UNITED STATES
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 Quarter ended March 31, 1999
or
( ) Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act oft 1934
For the transition period from _____________ to ______________
Commission File Number: 0-8536
THE NEW PARAHO CORPORATION
(Exact name of registrant as specified in its charter)
Colorado 84-1034362
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
5387 Manhattan Circle, #104, Boulder, CO 80303-4219
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (303) 543-8900
__________________________________________________________________
(Former name, former address and former fiscal year, if changed
since last report.)
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 twelve 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.
(x) Yes ( ) No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
50,772,982 shares of $.01 par value common stock as of March 31,
1999.
Transitional Small Business Disclosure Format (check one):
Yes ( ) No(x)
1 of 9 pages
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements.
THE NEW PARAHO CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS March 31, June 30,
1999 1998
(Unaudited)
____________ ___________
Current Assets:
Cash $ 79,634 $ 29,594
Accounts Receivable 424 130,628
Prepaid Expenses and other 1,057 9,080
Total Current Assets 81,115 169,302
Supplies 12,044 12,044
Plant, Furniture and Equipment,
at cost (net of accumulated
depreciation) 3,384 14,432
Mineral Properties 40,525 40,525
Patent, at cost (net of
accumulated amortization) 29,656 31,284
Other Assets 27,000 27,000
Total Assets $ 193,724 $ 294,587
-Continued on the following page-
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THE NEW PARAHO CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
-Continued from previous page-
LIABILITIES AND SHAREHOLDERS' EQUITY March 31, June 30,
1999 1998
(Unaudited) __________
Current Liabilities:
Accounts Payable $ 6,513 $ 30,787
Accrued Liabilities 5,321 2,129
Reclamation Liability 100,000 100,000
Total Current Liabilities 111,834 132,916
Long Term Liabilities:
Note Payable (Note 3) 865,596 865,596
Shareholder's Equity:
Common Stock - $.01 par value,
authorized - 75,000,000 shares;
issued - 50,980,400; outstanding -
50,772,982 507,730 507,730
Par value of common stock issued in
excess of the fair market value of
assets acquired (352,648) (352,648)
Accumulated deficit (938,788) (859,007)
Total Shareholders' Equity (783,706) (703,925)
$193,724 $294,587
The accompanying notes are an integral part
of these consolidated financial statements.
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THE NEW PARAHO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Nine Months Nine Months Three Months Three Months
Ended Ended Ended Ended
March 31, March 31, March 31, March 31,
1999 1998 1999 1998
REVENUES:
Interest Income $ 1,790 $ 1,813 $ 675 $ 499
Other 3,175 3,375 925 1,125
TOTAL REVENUES 4,965 5,188 1,600 1,624
COSTS AND EXPENSES:
Asphalt Research 0 2,142 0 1,265
General & Admin. 82,125 139,692 21,223 37,627
TOTAL COSTS & EXPENSES 82,125 141,834 21,223 38,892
LOSS BEFORE TAX BENEFIT (77,160) (136,646) (19,623) (37,268)
TAX BENEFIT (ADJUSTMENT) (2,620) 70,975 0 0
NET INCOME (LOSS) $(79,780) $(65,671) $(19,623) $(37,268)
INCOME (LOSS) PER SHARE $(0.00) $(0.00) $(0.00) $(0.00)
Weighted average
shares outstanding 50,772,982 50,772,982 50,772,982 50,772,982
The accompanying notes are an integral part
of these consolidated financial statements.
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THE NEW PARAHO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Nine Months
Ended Ended
March 31, March 31,
1999 1998
Cash flows from operating activities:
Net Loss ($79,781) $ (65,671)
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation and amortization 13,144 27,636
Change in operating assets and liabilities:
Change in receivables 130,204 (446)
Change in inventory - -
Change in prepaid expenses and other assets 8,023 10,982
Change in accounts payable (24,274) 5,945
Change in accrued liabilities 3,192 3,396
Net cash used in operating activities 50,508 (17,858)
Cash flows from investing activities:
Patent costs (468) (12,158)
Net cash used by investing activities (468) (12,158)
Cash flows from financing activities:
Net cash provided (used) by financing
activities - -
Net increase (decrease) in cash 50,040 (30,016)
Cash at beginning of year 29,594 43,259
Cash at end of quarter $ 79,634 $ 13,243
The accompanying notes are an integral part
of these consolidated financial statements.
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THE NEW PARAHO CORPORATION AND SUBSIDIARIES NOTES
NOTE 1 - MANAGEMENT REPRESENTATION
In the opinion of management, the accompanying unaudited
financial statements contain all adjustments (consisting of normal
recurring adjustments) necessary to present fairly the financial
position as of March 31, 1999 and the results of operations and
cash flows for the periods presented. The results of operations
for the nine month period ended March 31, 1999 are not necessarily
indicative of the results to be expected for the full year. The
June 30, 1998 balance sheet presented in this report is derived
from the June 30, 1998 audited financial statements but does not
include all disclosures required by generally accepted accounting
principles.
Certain information and footnote disclosures normally required
by generally accepted accounting principles have been condensed or
omitted. It is suggested that these condensed financial statements
be read in conjunction with the financial statements and notes
thereto included in the Company's June 30, 1998 audited report in
Form 10-K, filed with the Securities and Exchange Commission.
NOTE 2 - DEBT
On May 1, 1994, the Company's line of credit from the Tell
Ertl Family Trust was increased to $5,500,000 and on June 1, 1998,
the note was amended to reflect a maturity date of July 1, 1999.
Effective July 1, 1995, the Company was relieved and discharged of
all obligations to pay accrued interest on the line. In addition,
the line shall no longer accrue interest as of July 1, 1995. The
terms of the note provide that the Trust reserves the right to
approve activities and budgets of the Company during the term of
the promissory note. The balance of the note at March 31, 1999 was
$865,596.
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Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operation.
LIQUIDITY AND CAPITAL RESOURCES
The Company realized a decrease in working capital of $67,105
during the nine months ended March 31, 1999. Funds were primarily
provided by income from the rental of its Rifle facility. On
August 29, 1989 the Company signed an unsecured promissory note
with the Tell Ertl Family Trust. The principal amount of this note
was increased to a total of $5,500,000 on May 1, 1994. As of March
31, 1999, the Company owed $865,596 to the Trust. The funds were
used to cover the cost of operating expenses and asphalt research
and development. On December 18, 1996, the Company executed an
assignment of its interest in the note receivable from The Oil
Shale Company to the Trust in partial repayment of this note. The
Company does not expect to be able to pay the balance remaining on
this note when it becomes due.
The Company's three principal objectives include
commercialization of an oil shale derived asphalt binder, licensing
the Paraho technology, and research and development. However, at
the present time, in light of its inability to obtain commercial
financing, the Company is maintaining a minimal level of activity.
At this level, costs and expenses of $82,125 were incurred in the
nine months ended March 31, 1999. The decrease in these costs over
the amount incurred in the same period of the previous year, is the
result of the termination of a contract with a consultant engaged
to seek financing for the Company.
Possible future sources of cash include revenues from the
sales of SOMAT. Additional future sources of cash may include
revenues from the performance of engineering services, or from the
use of the Company's pilot plant retort facility. Management
presently does not expect that significant revenues from these
sources will be obtained.
RESULTS OF OPERATIONS
Quarter ended March 31, 1999
Revenues of $1,600 for the quarter ended March 31, 1999,
consisting primarily of rental of its Rifle facility, were
basically unchanged from the amount recognized in the same quarter
of the previous year. Expenses of $21,223 for the quarter ended
March 31, 1999 were less than the same quarter in the previous
year, which had included a retainer to a consultant engaged to seek
financing for the Company.
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PART II: OTHER INFORMATION
Item 1. Legal Proceedings.
The Company has been named in a complaint by an airport
authority which utilized the Company's product in paving an airport
runway. The airport authority has also filed suit against the
general contractor and the project engineer alleging that the
runway was negligently designed and built. Total damages asserted
against all three defendants are alleged to be $750,000.
Management believes that the Company has meritorious defenses, and
that any potential liability would be covered by insurance. While
the ultimate liability in this matter is difficult to assess,
management believes that the matter will be resolved without a
material adverse effect on the Company's financial position.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security
Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
None.
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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.
THE NEW PARAHO CORPORATION
(Registrant)
5/7/99 /s/ Joseph L. Fox
Date Joseph L. Fox, President
5/7/99 /s/ Anne Morgan Smith
Date Anne Morgan Smith, Controller
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