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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10QSB
[X] | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
| FOR THE QUARTERLY PERIOD ENDEDSEPTEMBER 30, 2001 |
OR | |
[ ] | Transition Report Pursuant to Section 13 or 15(d) of the Securities Act of 1934 |
| For the transition period from to |
COMMISSION FILE NUMBER 000-33199
KEYSTONE MINES LIMITED
(Exact name of registrant as specified in its charter)
NEVADA | 88-0467848 |
(State of other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
1040 West Georgia
Suite 1160
Vancouver, British Columbia
Canada V6E 4H1
(Address of principal executive offices)
(604) 605-0885
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has 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 [ x ] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of September 30, 2001: 6,011,198
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KEYSTONE MINES LIMITED | |||||||||
(AN EXPLORATION STAGE ENTERPRISE) | |||||||||
BALANCE SHEETS | |||||||||
September 30, | June 30, | ||||||||
2001 | 2001 | ||||||||
(Unaudited) |
| ||||||||
ASSETS | |||||||||
CURRENT ASSETS | |||||||||
Cash | $ | 42,793 | $ | 48,890 | |||||
Total Current Assets | 42,793 | 48,890 | |||||||
OTHER ASSETS | |||||||||
Mining claims | 27 | 27 | |||||||
Total Other Assets | 27 | 27 | |||||||
TOTAL ASSETS | $ | 42,820 | $ | 48,917 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
CURRENT LIABILITIES | |||||||||
Accounts payable | $ | 3,340 | $ | 335 | |||||
Related party payables | 3,116 | 2,437 | |||||||
Total Current Liabilities | 6,456 | 2,772 | |||||||
COMMITMENTS AND CONTINGENCIES | - | - | |||||||
STOCKHOLDERS' EQUITY | |||||||||
Common stock, 100,000,000 shares authorized, $0.00001 | |||||||||
par value; 6,011,198 shares issued and outstanding | 60 | 60 | |||||||
Additional paid-in-capital | 601,060 | 601,060 | |||||||
Stock subscriptions receivable | - | - | |||||||
Deficit accumulated during exploration stage | (564,756) | (554,975) | |||||||
Total Stockholders' Equity | 36,364 | 46,145 | |||||||
TOTAL LIABILITIES AND | |||||||||
STOCKHOLDERS' EQUITY | $ | 42,820 | $ | 48,917 | |||||
See Notes to Interim Financial Statements
KEYSTONE MINES LIMITED | ||||||||||||
(AN EXPLORATION STAGE ENTERPRISE) | ||||||||||||
STATEMENTS OF OPERATIONS | ||||||||||||
From | ||||||||||||
Three Months | Three Months | June 26, 2000 | ||||||||||
Ended | Ended | (Inception) to | ||||||||||
September 30, | September 30, | September 30, | ||||||||||
2001 | 2000 | 2001 | ||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
REVENUES | $ | - | $ | - | $ | - | ||||||
EXPENSES | ||||||||||||
Consulting services provided by directors | - | - | 498,523 | |||||||||
Mining exploration expense | - | 1,337 | 4,597 | |||||||||
Legal and accounting | 4,605 | 12,752 | 36,042 | |||||||||
General and administrative | 2,840 | 41 | 8,893 | |||||||||
Rent | 1,306 | - | 3,144 | |||||||||
Investors relations | 1,005 | - | 6,563 | |||||||||
Board of directors' expenses | - | - | 3,939 | |||||||||
Transfer fees | 25 | - | 3,075 | |||||||||
TOTAL EXPENSES | 9,781 | 14,130 | 564,776 | |||||||||
LOSS FROM OPERATIONS | (9,781) | (14,130) | (564,776) | |||||||||
OTHER INCOME | ||||||||||||
Miscellaneous income | - | 20 | 20 | |||||||||
TOTAL OTHER INCOME | - | 20 | 20 | |||||||||
LOSS BEFORE INCOME TAXES | (9,781) | (14,110) | (564,756) | |||||||||
INCOME TAXES | - | - | - | |||||||||
NET LOSS | $ | (9,781) | $ | (14,110) | $ | (564,756) | ||||||
NET LOSS PER COMMON SHARE, | ||||||||||||
BASIC AND DILUTED | $ | nil | $ | nil | $ | (0.11) | ||||||
WEIGHTED AVERAGE NUMBER OF | ||||||||||||
COMMON STOCK SHARES OUTSTANDING, | ||||||||||||
BASIC AND DILUTED | 6,011,198 | 5,000,000 | 5,469,493 | |||||||||
See Notes to Interim Financial Statements
KEYSTONE MINES LIMITED | ||||||||||||||||||||
(AN EXPLORATION STAGE ENTERPRISE) | ||||||||||||||||||||
STATEMENT OF STOCKHOLDERS' EQUITY | ||||||||||||||||||||
Deficit | ||||||||||||||||||||
Accumulated | Total | |||||||||||||||||||
Common Stock | Additional | During the | Stock | Stockholders' | ||||||||||||||||
Number | Paid-in | Exploration | Subscriptions | Equity | ||||||||||||||||
| of Shares | Amount | Capital | Stage | Receivable | |||||||||||||||
Issuance of common stock for | ||||||||||||||||||||
services and in payment of | 5,000,000 | $ | 50 | $ | 499,950 | $ | - | $ | (795) | $ | 499,205 | |||||||||
advances at approximately | ||||||||||||||||||||
$0.10 per share | ||||||||||||||||||||
Loss for period ending, June 30, 2000 | - | - | - | (498,923) | - | (498,923) | ||||||||||||||
Balance, June 30, 2000, restated | 5,000,000 | 50 | 499,950 | (498,923) | (795) | 282 | ||||||||||||||
Payment of subscriptions receivable | - | - | - | - | 795 | 795 | ||||||||||||||
Sale of common stock for cash at | ||||||||||||||||||||
$0.10 per share | 1,011,198 | 10 | 101,110 | - | - | 101,120 | ||||||||||||||
Loss for the year ended | ||||||||||||||||||||
ended June 30, 2001 | - | - | - | (56,052) | - | (56,052) | ||||||||||||||
Balance, June 30, 2001 | 6,011,198 | 60 | 601,060 | (554,975) | - | 46,145 | ||||||||||||||
Loss for the three months ended | ||||||||||||||||||||
September 30, 2001 | - | - | - | (9,781) | - | (9,781) | ||||||||||||||
Balance, September 30, 2001 (unaudited) | 6,011,198 | $ | 60 | $ | 601,060 | $ | (564,756) | $ | - | $ | 36,364 | |||||||||
See Notes to Interim Financial Statements
KEYSTONE MINES LIMITED | |||||||||||
(AN EXPLORATION STAGE ENTERPRISE) | |||||||||||
STATEMENTS OF CASH FLOWS | |||||||||||
From | |||||||||||
Three Months | Three Months | June 26, 2000 | |||||||||
Ended | Ended | (Inception) to | |||||||||
September 30, | September 30, | September 30, | |||||||||
2001 | 2000 | 2001 | |||||||||
(Unaudited) | (Unaudited) | (Unaudited) | |||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
Net loss | $ | (9,781) | $ | (14,110) | $ | (564,756) | |||||
Adjustments to reconcile net loss to cash | |||||||||||
Provided (used) in operating activities: | |||||||||||
Increase in related party payables | 679 | 12,752 | 3,116 | ||||||||
Decrease (increase) in prepaid expenses | - | 682 | |||||||||
Increase in mining claims | - | (27) | (27) | ||||||||
Increase in accounts payable | 3,005 | - | 3,340 | ||||||||
Payment of expenses from issuance of stock | - | - | 499,840 | ||||||||
Net cash provided (used) in operating activities | (6,097) | (703) | (58,487) | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | - | - | - | ||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
Stock subscriptions (sold) paid | - | 795 | - | ||||||||
Proceeds from advances | - | - | 160 | ||||||||
Issuance of common stock | - | - | 101,120 | ||||||||
Net cash provided (used) by financing activities | - | 795 | 101,280 | ||||||||
Change in cash | (6,097) | 92 | (42,793) | ||||||||
Cash, beginning of period | 48,890 | - | - | ||||||||
Cash, end of period | $ | 42,793 | $ | 92 | $ | 42,793 | |||||
Supplemental cash flows disclosures: | |||||||||||
Interest paid | $ | - | $ | - | $ | - | |||||
Income taxes paid | $ | - | $ | - | $ | - | |||||
Non-cash transactions: | |||||||||||
Stock issued in payment of consulting and other expenses | $ | - | $ | - | $ | 499,840 | |||||
Stock issued in payment of advances | $ | - | $ | - | $ | 133 | |||||
Stock issued in payment of mining claims | $ | - | $ | - | $ | 27 | |||||
See Notes to Interim Financial Statements
KEYSTONE MINES LIMITED
(An Exploration Stage Company)
September 30, 2001
NOTES TO INTERIM FINANCIAL STATEMENTS
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1. BASIS OF PRESENTATION
The foregoing unaudited interim financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Regulation S-B as promulgated by the Securities and Exchange Commission. Accordingly, these financial statements do not include all of the disclosures required by generally accepted accounting principles for complete financial statements. These unaudited interim financial statements should be read in conjunction with the audited financial statements for the period ended June 30, 2001. In the opinion of management, the unaudited interim financial statements furnished herein include all adjustments, all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim period presented.
The preparation of financial statements in accordance with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and the reported amounts of revenues and expenses during the reporting period. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of the Company's financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions that could have a material effect on the reported amounts of the Company's financial position and results of operations.
Operating results for the three-month period ended September 30, 2001 are not necessarily indicative of the results that may be expected for the year ending June 30, 2002.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Financial Condition, Liquidity and Capital Resources
Since inception on June 26, 2000, our Company has been engaged in exploration and acquisition of mineral properties. Our Company's principal capital resources have been acquired through issuance of common stock and from shareholder loans.
At September 30, 2001, we had positive working capital of $36,337 compared to deficit working capital of $(13,060) at September 30, 2000. This change is primarily the result of our Company's stock issuance proceeds of $101,120, more than offsetting increasing accounts payable and payment of related party loans.
At September 30, 2001, our Company's total assets of $42,820 consists of mainly cash. This compares favourably with our Company's assets at September 30, 2000 of $119, which consisted of $92 in cash.
At September 30, 2001, our Company's total liabilities decreased to $6,456 from $13,152 at September 30, 2000, primarily reflecting a build-up of accounts payable of $3,340 and a net payment of related party payables in the amount of $10,036.
Our Company has not had revenues from inception. Although there is insufficient capital to fully explore and develop its mineral properties, our Company expects to survive and exploit its resources primarily with funding from sales of its securities and, as necessary, from shareholder loans.
Our Company has no long-term debt and does not regard long-term borrowing as a good, prospective source of financing.
Results of Operations
Our Company posted losses of $9,781 for the three months ending September 30, 2001. The principal components of the loss were professional expenses and general and administrative expenses.
Operating expenses for the three months ending September 30, 2001 were $9,781, down $4,349 from the three months ending September 30, 2000, due mainly to a decline in professional fees, more than offsetting increases in general and administrative expenses and rent.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on this 5th day of November, 2001.
KEYSTONE MINES LIMITED
(Registrant)
/s/ Mike Muzylowski
Mike Muzylowski, President, Treasurer,
Chief Financial Officer and a Member
of the Board Of Directors
