U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended December 31, 2003
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE EXCHANGE ACT
For the transition period from _____ to _____.
Commission File No. 0-9458
Eagle Exploration Company
(Exact name of registrant as specified in its character)
Colorado 84-0804143
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(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
1801 Broadway, Suite 810, Denver, Colorado 80202
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(Address and zip code of principal executive offices)
Registrant's telephone number, including area code: (303) 296-3677
Indicate by check mark whether the registrant (1) filed all reports
required to be filed by Section 13 or 15(d) of the 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 ___.
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Indicate the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date:
Class Number of Shares
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Common stock 3,072 836
Transitional Small Business Disclosure format: (Check one) Yes ___ No X .
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EAGLE EXPLORATION COMPANY AND SUBSIDIARIES
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
PART I FINANCIAL INFORMATION
- ------ ---------------------
Item 1 Condensed Consolidated Balance Sheets -
- ------ March 31, 2003, and December 31, 2003 (Unaudited)
Unaudited Condensed Consolidated Statements of Operations -
Three and Nine Months Ended December 31, 2003 and 2002
Unaudited Condensed Consolidated Statements of Cash Flows -
Nine Months Ended December 31, 2003 and 2002
Notes to Unaudited Condensed Consolidated Financial Statements
Item 2 Management's Discussion and Analysis of
- ------ Financial Condition and Results of Operations
Item 3 Controls and Procedures
- ------
PART II OTHER INFORMATION
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Item 6 Exhibits and Reports on Form 8-K
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SIGNATURES
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EAGLE EXPLORATION COMPANY AND SUBSIDIARIES
PART I......FINANCIAL INFORMATION
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Item 1
- ------
Condensed Consolidated Balance Sheets
December 31, March 31,
2003 2003
------------ ------------
(Unaudited)
Assets
Current assets
Cash $ 305,624 $ 720,331
Marketable securities 352,825 317,468
Certificates of deposit 300,000 0
Accounts receivable 6,002 13,157
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Total current assets 964,451 1,050,956
Office furniture, equipment and other, net of
accumulated depreciation of $237,645 and $233,505 at
December 31, 2003 and March 31, 2003, respectively 55,342 43,875
Real estate held for sale 298,525 301,275
Investment in option to purchase real estate 212,739 202,739
Other assets 24,837 24,837
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Total assets $1,555,894 $1,623,682
========== ==========
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $ 10,727 $ 9,088
Deposits, deferred revenue and other 6,149 6,149
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Total current liabilities 16,876 15,237
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Stockholders' equity
Common stock, no par value; authorized 10,000,000
shares; 3,072,836 shares issued and outstanding 6,632,998 6,632,998
Accumulated deficit (5,133,257) (5,028,473)
Unrealized holding gain on investments available for
sale 39,277 3,920
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1,539,018 1,608,445
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Total liabilities and stockholders' equity $1,555,894 $1,623,682
========== ==========
See notes to unaudited condensed consolidated financial statements.
Unaudited Condensed Consolidated Statements of Operations
For the Three For the Nine
Months Ended Months Ended
December 31, December 31,
----------------------- ---------------------
2003 2002 2003 2002
-------- -------- ------- --------
Revenue
Oil and gas $30,587 $10,890 $45,314 $34,086
------- ------- ------- -------
Total revenue 30,587 10,890 45,314 34,086
------- ------- ------- -------
Expenses
Depreciation 3,921 2,325 8,906 6,975
General and administrative 62,484 49,448 169,720 146,572
------- ------- ------- -------
Total expense 66,405 51,773 178,626 153,547
------- ------- ------- -------
Loss from operations (35,818) (40,883) (133,312) (119,461)
------- ------- -------- --------
Other income
Interest and dividend
income 11,617 12,077 23,746 29,246
Miscellaneous income 251 - 4,782 10,575
------- ------- ------- -------
Total other income 11,868 12,077 28,528 39,821
------- ------- ------- -------
Net loss before other
comprehensive income (loss) (23,950) (28,806) (104,784) (79,640)
Other comprehensive income
(loss)
Unrealized gain (loss) on
investments
available-for-sale 24,573 (7,339) 35,357 (77,591)
------- ------- -------- --------
Comprehensive income (loss) 623 (36,145) (69,427) (157,231)
======= ======= ======= =======
Basic and diluted weighted
average common shares
outstanding 3,072,836 3,072,836 3,072,836 3,072,836
========= ========= ========= =========
Basic and diluted loss per
common share $ .00 $ (.01) $ (.02) $ (.05)
========= ========= ========= =========
Unaudited Condensed Consolidated Statements of Cash Flows
For the Nine Months Ended
December 31,
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2003 2002
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Cash flows from operating activities
Net loss $ (104,784) $ (79,640)
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Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation 8,906 6,975
Gain on trade-in of vehicle (4,531) -
Change in assets and liabilities:
Decrease (increase) in accounts receivable 7,155 (5,048)
Increase (decrease) in accounts payable 1,639 (3,564)
------------ -------------
13,169 (1,637)
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Net cash flows used in operating activities (91,615) (81,277)
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Cash flows from investing activities
(Purchase) Redemption of certificates of deposit, net (300,000) 103,043
Purchases of office furniture and equipment (22,342) (26,748)
Purchase of investment in option to purchase real
estate (10,000) (70,000)
Proceeds from the sale of assets 6,500 -
Proceeds from real estate held for sale 2,750 -
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Net cash flows used in investing activities (323,092) 6,295
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Net decrease in cash and cash equivalents (414,707) (74,982)
Cash and cash equivalents, beginning of year 720,331 661,251
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Cash and cash equivalents, end of quarter $ 305,624 $ 586,269
============ =============
Supplemental disclosure of cash flow information:
The change in unrealized gain (loss) on investments available-for-sale for
the nine months ended December 31, 2003 and December 31, 2002 was $35,357
and $(77,591), respectively.
Notes to Unaudited Condensed Consolidated Financial Statements
Opinion of Management
1. The financial information furnished reflects all adjustments, which are, in
the opinion of management, necessary for a fair presentation of the financial
position at December 31, 2003 and March 31, 2003 and of the condensed
consolidated statements of operations and condensed consolidated statements of
cash flows for the three and nine months ended December 31, 2003 and 2002. The
results of operations and statements of cash flows for the periods presented are
not necessarily indicative of those to be expected for the entire year.
2. The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles.
For further information refer to the audited consolidated financial statements
and notes thereto for the year ended March 31, 2003, included in the Company's
10-KSB filed with the Securities and Exchange Commission on June 29, 2003.
Stockholders' Equity
In July 2002, the Company issued options to purchase 275,000 shares of the
Company's common stock to the two officers of the Company and one employee. The
options were issued at market value on the date of grant with a term of five
years.
Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations
Financial Condition, Liquidity and Capital Resources
Cash decreased during the nine months ended December 31, 2003, by $414,707. This
decrease is primarily due to the purchase of $300,000 in certificates of deposit
and operating costs.
Stockholders' equity decreased from $1,608,445 at March 31, 2003 to $1,539,018
at December 31, 2003 or $69,427. The Company incurred an unrealized gain on the
investments available-for-sale of $35,357 and a net operating loss of $104,784
for the period ended December 31, 2003.
Results of Operations
For the Nine Months Ended December 31, 2003, Compared to the Nine Months Ended
December 31, 2002.
For the nine months ended December 31, 2003, the Company's total oil and gas
revenue was $45,314 as compared to $34,086 for the nine months ended December
32, 2002. Other income including interest and dividend income was $28,528 for
the period ended December 31, 2003, and $39,821 for the period ended December
31, 2002.
Total expense for the nine months ended December 31, 2003, was $178,626 as
compared to $153,547 for the nine months ended December 31, 2002. Unrealized
gain on investments available-for-sale for the period ended December 31, 2003,
was $35,357, and for the period ended December 31, 2002, the Company had an
unrealized loss on investments available-for-sale of $77,591. This resulted in a
comprehensive loss of $69,427 and $157,231 for the period ended December 31,
2003, and 2002, respectively.
Item 3: Controls and Procedures
As of the end of the period covered by this report, the Company conducted an
evaluation, under the supervision and with the participation of the principal
executive officer and principal financial officer, of the Company's disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934 (the "Exchange Act"). Based on this evaluation,
the principal executive officer and principal financial officer concluded that
the Company's disclosure controls and procedures are effective to ensure that
information required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in Securities and Exchange Commissions rules
and forms. There was no change in the Company's internal control over financial
reporting during the Company's most recently completed fiscal quarter that has
materially affected or is reasonably likely to materially affect the Company's
internal control over financial reporting.
PART II
Item 6. Exhibits and reports on Form 8-K
Exhibit 31.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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.
EAGLE EXPLORATION COMPANY
(Registrant)
By: /s/ Raymond N. Joeckel
Raymond N. Joeckel
President/Chief Financial Officer
By: /s/ Paul M. Joeckel
Secretary/Vice President Operations
Date: February 17, 2004
