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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE COMMISSION ACT OF 1934
For the period ended November 30, 1998
Commission File Number: 001-05970
SILVER BUTTE MINING COMPANY
(Exact name of registrant as specified in its charter)
IDAHO 82-0263301
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification Number)
520 Cedar Street, Sandpoint, ID 83864
(Address of Principal Executive Offices) (Zip Code)
(208) 263-5154
Registrant's telephone number, including area code
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes ( ) No (X)
The number of shares of Common Stock, $.05 par value, outstanding as of
November 30, 1998, was 7,828,748.
DOCUMENTS INCORPORATED BY REFERENCE: Form 8-K dated January 15, 1999
Transitional Small Business Disclosure Format (Check One): Yes ( ) No (X)
*****************************************************************************
Document page 1 of 8
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SILVER BUTTE MINING COMPANY
FORM 10-QSB QUARTERLY REPORT
November 30, 1998
INDEX
Page
Number
Part I FINANCIAL INFORMATION
Item 1. Condensed Financial Statements
Item 1. Condensed Financial Statements
Balance Sheets, November 30 and August 31, 1998 . . . . . 3
Income Statements for the three months ended
November 30, 1998, and 1997 . . . . . . . . . . . . . . . . 4
Cash Flow Statements for the three months ended
November 30, 1998, and 1997 . . . . . . . . . . . . . . . . 5
Notes to Condensed Financial Statements . . . . . . . . . . . . . . 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations . . . . . . . 7-8
Signature Page . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Document page 2 of 8
<PAGE>
SILVER BUTTE MINING COMPANY
CONDENSED BALANCE SHEETS
November 30 and August 31, 1998
<TABLE>
November 30, August 31,
1998 1998
____________ ____________
<C> <S> <S>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 803 $ 480
Certificate of deposit for State lease 5,000 5,000
Marketable securities 69,235 70,336
Accounts receivable 1,333 1,091
Prepaid expenses 184 512
____________ ____________
TOTAL CURRENT ASSETS 76,555 77,419
PROPERTY, PLANT & EQUIPMENT
Properties 3,000 3,000
Equipment and machinery 19,704 19,704
Accumulated depreciation (19,704) (19,704)
____________ ____________
3,000 3,000
____________ ____________
TOTAL ASSETS $ 79,555 $ 80,419
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 5,146 $ 2,660
____________ ____________
TOTAL CURRENT LIABILITIES 5,146 2,660
____________ ____________
SHAREHOLDERS' EQUITY
Common stock, $.05 par value
authorized 10,000,000 shares,
issued and outstanding,
7,828,748 shares 391,437 391,437
Additional paid-in capital 392,953 392,953
Accumulated deficit (709,981) (706,631)
____________ ____________
TOTAL SHAREHOLDERS' EQUITY 74,409 77,759
____________ ____________
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 79,555 $ 80,419
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Document page 3 of 8
<PAGE>
SILVER BUTTE MINING COMPANY
CONDENSED INCOME STATEMENTS
For the Three Months Ended November 30, 1998 and 1997
<TABLE>
Three Months Ended
__________________________
November 30, November 30,
1998 1997
____________ ____________
<S> <C> <C>
REVENUE
Dividend income $ 899 $ -
Interest income 72 850
Rock sales 504 780
Misc. other income 33 31
____________ ____________
Total Revenues 1,508 1,661
____________ ____________
EXPENSES
Wages and other compensation 2,598 2,835
Professional services 465 2,084
Taxes and insurance 839 -
Rent 267 190
Office expense - 122
Miscellaneous 689 98
____________ ____________
Total Expenses 4,858 5,329
____________ ____________
LOSS BEFORE INCOME TAXES (3,350) (3,668)
INCOME TAXES - -
____________ ____________
NET LOSS $ (3,350) $ (3,668)
============ ============
Loss per Share of Common Stock
Outstanding $ (0.0004) $ (0.0005)
============ ============
Weighted Average Number of Common Shares
Outstanding 7,828,748 7,828,748
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Document page 4 of 8
<PAGE>
SILVER BUTTE MINING COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
For the three Months Ended November 30, 1998 and 1997
<TABLE>
Three Months Ended
______________________________
November 30, November 30
1998 1997
____________ ____________
<C> <S> <S>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $ (3,350) $ (3,668)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Increase in payables 2,486 1,441
Decrease in prepaid expenses 328 -
Increase in receivables (242) (779)
____________ ____________
Net cash used in
operating activities (778) (3,006)
____________ ____________
CASH FLOWS FROM INVESTING ACTIVITIES
Decrease (increase) in marketable
securities 1,101 (75,031)
____________ ____________
Net cash provided by (used in)
investing activities 1,101 (75,031)
____________ ____________
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS 323 (78,037)
Cash and Cash Equivalents at Beginning
of Period 480 84,297
____________ ____________
Cash and Cash Equivalents at End of Period $ 803 $ 6,260
============ ============
Interest expense paid $ - $ -
============ ============
Income taxes paid $ - $ -
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Document page 5 of 8
<PAGE>
SILVER BUTTE MINING COMPANY
FORM 10-QSB QUARTERLY REPORT
November 30, 1998
*****************************************************************************
NOTES TO FINANCIAL STATEMENTS
Note 1. Presentation of Interim Information
The accompanying unaudited condensed financial statements have been
prepared by Silver Butte Mining Company's management. In management's
opinion, these condensed financial statements include all normal adjustments
considered necessary to present fairly the financial position as of November
30, 1998, and the results of operations for the three months ended November
30, 1998 and 1997, and cash flows for the three months ended November 30,
1998 and 1997. Interim results are not necessarily indicative of results
for a full year.
The condensed financial statements and notes are presented as permitted
by Form 10-QSB, and do not contain certain information that is included in
the Company's annual financial statements.
Note 2. Company Business
The Company was incorporated under the laws of the State of Idaho on
January 19, 1965, and was in the exploratory mining stage from its inception
until it decided to abandon its status as a development stage enterprise by
ceasing all exploration activities in 1994. The company's exploration
efforts developed no commercial ore deposits, and all capitalized
mining costs were written off. The Company continues to search for business
opportunities in the mining industry, and will also investigate opportunities
in other industries. The Company's meager financial resources severely limit
its ability to carry out the type of exploration activity that it performed
in past years, and the Company's management considers it unlikely that the
Company will obtain additional funding with which to undertake such
exploration.
Note 3. Commitments and Contingencies
The Company sold a seven acre parcel of land in the fiscal year ended
August 31, 1996 that contained mine waste rock and mill tailings. The
Company's management estimates there is a remote possibility that this
property may require some cleanup, and an even more remote possibility that
the Company may be required to participate in the cost of such a cleanup,
which the Company estimates would be less than $10,000.
Document page 6 of 8
<PAGE>
SILVER BUTTE MINING COMPANY
FORM 10-QSB QUARTERLY REPORT
November 30, 1998
*****************************************************************************
Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION
The Company was a mining company engaged in exploration activities
from its inception in 1965 through 1994. In 1994, the Company abandoned
all exploration activities, and is now seeking other business opportunities
in mining or other industries. The Company continues to hold and maintain
the properties on which it performed its exploration efforts. The Company's
fiscal year ends on August 31.
Overview
The Company's management determined in 1994 that the Company did not
have the financial resources to continue to explore for a commercial ore
deposit after many years of unsuccessful efforts. The Company has performed
some reclamation work on its mining properties since 1994, and is soliciting
buyers for its remaining real estate and mining equipment. The Company is
seeking out other business opportunities. Management is unaware of any such
opportunities at this time and will disclose such opportunities when and if
they should arise.
Results of Operations
Revenues. The Company's interest income decreased by $778, and the
Company's dividend income increased by $899 for the quarter ended November
30, 1998, compared to the same period ended November 30, 1997. This was the
result of management's decision to invest a significant portion of the
Company's funds in money market equity securities.
Expenses. Professional services were lower in the three months ended
November 1998, when compared to the same period for 1997, because management
required fewer services from outside consultants. Taxes and insurance were
higher in the first fiscal quarter of 1998, than the first quarter of 1997,
because of the additional costs of workers compensation insurance and payroll
taxes. Miscellaneous expenses, which include supplies used in connection
with the reclamation of the State lease, were higher in the first quarter of
1998, than the first quarter of 1997, because of the Company's efforts to
complete the reclamation work by the end of calendar year 1998.
Financial Position. There was an increase in accounts payable of $2,486
during the fiscal quarter ended November 30, 1998 when compared to the balance
at the end of the previous quarter. This was primarily the result of accrued
expenses in connection with the reclamation work that were paid following the
end of the quarter. There were no other remarkable changes in financial
position during the first quarter.
The Company will continue to sell marketable securities during the
balance of the fiscal year to provide cash for operating expenses.
Document page 7 of 8
<PAGE>
SILVER BUTTE MINING COMPANY
FORM 10-QSB QUARTERLY REPORT
November 30, 1998
****************************************************************************
Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION (Continued)
Cash Flows. Cash and cash equivalents increased very little ($323)
during the three months ended November 30, 1998. The net loss from
operations was funded in part by an increase in payables and a decrease in
prepaid expenses. Other cash was provided by a decrease in marketable
securities of $1,101. The Company has no plans for capital expenditures
that will require significant amounts of cash.
Cash and cash equivalents decreased by $75,031 during the three months
ended November 30, 1997, as a result of investing in money market equity
securities during the period.
****************************************************************************
SIGNATURES
****************************************************************************
In accordance with section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
SILVER BUTTE MINING COMPANY
(Registrant)
/s/ R. Richard Rice
_________________________ Date: January 15, 1998
R. Richard Rice
Title: President
(Principle Executive Officer and
Principle Accounting Officer)
Document page 8 of 8
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements at November 30, 1998 (Unaudited) and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> AUG-31-1999
<PERIOD-END> NOV-30-1998
<CASH> 803
<SECURITIES> 69,235
<RECEIVABLES> 1,333
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 76,555
<PP&E> 22,704
<DEPRECIATION> 19,704
<TOTAL-ASSETS> 79,555
<CURRENT-LIABILITIES> 5,146
<BONDS> 0
0
0
<COMMON> 391,437
<OTHER-SE> (317,028)
<TOTAL-LIABILITY-AND-EQUITY> 74,409
<SALES> 0
<TOTAL-REVENUES> 1,508
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 4,858
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,350)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,350)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,350)
<EPS-PRIMARY> (0.000)
<EPS-DILUTED> (0.000)
</TABLE>
