U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the quarterly period ended September 30, 2003
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 For the transition period from _____________to_______________
Commission file number: 0-49936
St. Joseph Energy, Inc.
----------------------------------------------
(Name of small business issuer in its charter)
Colorado CH 47-0844532
- ------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
906 East 7th Street Hastings, Nebraska 68901
- ----------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (402) 461-4957
Former name, former address and former fiscal year if changed since last report
Indicate by checkmark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 registrant's classes of
common stock, as of the latest practical date:
Outstanding at October 31, 2003
---------------------------------
2,998,920
$.001 par value common stock
ST. JOSEPH ENERGY, INC.
FORM 10-QSB
TABLE OF CONTENTS
PART I--FINANCIAL INFORMATION
ITEM 1. Financial Statements............................................... 1
ITEM 2. Management Discussion and Analysis of Financial Condition
and Results of Operations.......................................... 2
ITEM 3. Controls and Procedures............................................ 3
PART II--OTHER INFORMATION
ITEM 1. Legal Proceedings.................................................. 4
ITEM 2. Changes in Securities and Use of Proceeds.......................... 4
ITEM 3. Defaults Upon Senior Securities.................................... 4
ITEM 4. Submission of Matters to a Vote of Security Holders................ 4
ITEM 5. Other Information.................................................. 4
ITEM 6. Exhibits and Reports on Form 8-K................................... 5
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PART I--FINANCIAL INFORMATION
ITEM 1. Financial Statements
ST. JOSEPH ENERGY, INC.
(A Development Stage Company)
CONDENSED FINANCIAL STATEMENTS
UNAUDITED
INDEX
Page
____
Unaudited Condensed Balance Sheets........................................ F-1
Unaudited Statements of Operations for the Three-month
and Nine-months ended September 30, 2003 and 2002..................... F-2
Unaudited Statements of Cash Flows for the Nine-months
ended September 30, 2003 and 2002.................................... F-3
Notes to Unaudited Condensed Financial Statements......................... F-4
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ST. JOSEPH ENERGY, INC.
(A Development Stage Company)
Condensed Balance Sheet
(Unaudited)
September 30, 2003
Assets
Current assets:
Cash............................................................. $ 80
Inventory, at cost............................................... 1,304
--------
Total current assets 1,384
--------
Property and equipment, net...................................... 2,595
--------
$ 3,979
========
Liabilities and Shareholders' Deficit
Current liabilities:
Accounts payable and accrued liabilities......................... $ 27,600
--------
Total current liabilities................................... 27,600
--------
Shareholders' deficit:
Preferred stock................................................ -
Common stock................................................... 2,749
Additional paid-in capital..................................... 197,571
Deficit accumulated during development stage................... (223,941)
--------
Total shareholders' deficit.................................. (23,621)
--------
$ 3,979
========
See accompanying notes to condensed financial statements
F-1
ST. JOSEPH ENERGY, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
March 19,
1999
(Inception)
Three Months Ended Nine Months Ended Through
September 30, September 30, September 30,
__________________ __________________
2003 2002 2003 2002 2003
__________ __________ __________ __________ __________
Operating expenses:
Professional fees.................$ 450 $ 4,750 $ 2,577 $ 6,250 $ 51,028
Investment loss .................. - - - - 119,500
Contributed rent (Note 2)......... 600 600 1,800 1,800 10,800
Compensation...................... - - - - 1,358
Office and shop supplies.......... 180 - 1,876 - 4,716
Depreciation...................... 782 902 1,996 2,704 11,768
Other............................. 39 14 57 32 9,271
---------- --------- ---------- --------- ---------
Total operating expenses..... 2,051 6,266 8,306 10,786 208,441
---------- --------- ---------- --------- ---------
Loss from operations......... (2,051) (6,266) (8,306) (10,786) (208,441)
Interest expense.................... - - - - (15,500)
---------- --------- ---------- ---------- ---------
Loss before income taxes..... (2,051) (6,266) (8,306) (10,786) (223,941)
Income tax provision (Note 3)....... - - - - -
---------- --------- ---------- ---------- ---------
Net loss.....................$ (2,051) $ (6,266) $ (8,306) $ (10,786) $ (223,941)
========== ========= ========== ========== ===========
Basic and diluted loss per share....$ (0.00) $ 0.00 $ (0.00) $ 0.00
========== ========= ========== ==========
Weighted average common shares
outstanding....................... 2,748,920 2,742,920 2,748,920 2,719,898
========= ========= ========= =========
See accompanying notes to condensed financial statements
F-2
ST. JOSEPH ENERGY, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
March 19,
1999
(Inception)
Nine Months Ended Through
September 30, September 30,
_____________
2003 2002 2003
____ ____ ____
Net cash used in
operating activities................. $ (6,646) $ (5,532) $ (40,077)
-------- --------- ---------
Cash flows from investing activities:
Acquisition of property and equipment........... - - (14,363)
Payments for mineral lease interests............ - - (135,000)
-------- --------- ---------
Net cash used in
investing activities................. - - (149,363)
-------- --------- -------
Cash flows from financing activities:
Capital contributed by an officer (Note 2)...... 1,000 - 1,000
Proceeds from the sale of common stock.......... - 11,800 189,230
Payments for offering costs..................... - - (710)
-------- --------- ---------
Net cash provided by
financing activities................. 1,000 11,800 189,520
-------- --------- ---------
Net change in cash................... (5,646) 6,268 80
Cash, beginning of period......................... 5,726 1,762 -
-------- --------- ---------
Cash, end of period............................... $ 80 $ 8,030 $ 80
======== ========= =========
Supplemental disclosure of cash flow
information:
Income taxes...................................... $ - $ - $ -
======== ========= =========
Interest.......................................... $ - $ - $ -
======== ========= =========
Non-cash investing and financing activities:
Mineral lease interests acquires for debt......... $ - $ - $ 200,000
======== ========= =========
See accompanying notes to condensed financial statements
F-3
ST. JOSEPH ENERGY, INC.
(A Development Stage Company)
Notes to Unaudited Condensed Financial Statements
(1) Basis of Presentation
The condensed financial statements presented herein have been prepared by the
Company in accordance with the instructions for Form 10-QSB and the accounting
policies in its Form 10-SB for the year ended December 31, 2002 and should be
read in conjunction with the notes thereto.
In the opinion of management, the accompanying condensed financial statements
contain all adjustments (consisting only of normal recurring adjustments) which
are necessary to provide a fair presentation of operating results for the
interim periods presented. The results of operations presented for the three
and nine months ended September 30, 2003 are not necessarily indicative of the
results to be expected for the year.
Financial data presented herein are unaudited.
(2) Related Party Transactions
An officer contributed office space to the Company for all periods presented.
The office space was valued at $200 per month based on the market rate in the
local area and is included in the accompanying financial statements as
contributed rent with a corresponding credit to contributed capital.
During the three months ended September 30, 2003, an officer contributed $1,000
to the Company for working capital.
(3) Income Taxes
The Company records its income taxes in accordance with Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". The Company
incurred net operating losses during all periods presented resulting in a
deferred tax asset, which has been fully allowed for; therefore, the net benefit
and expense resulted in $-0- income taxes.
(4) Subsequent Event
During October 2003, the Company sold 250,000 shares of its common stock for
$1,250 ($.005 per share). Following the sale, the Company had 2,998,920 common
shares issued and outstanding
F-4
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis of the financial condition and results of
operations should be read in conjunction with the Financial Statements and Notes
thereto appearing elsewhere in this Form 10-QSB. As described elsewhere in this
Form 10-QSB, St. Joseph is a development stage company. As of the date of this
registration Statement, St. Joseph is in the business of producing and selling
pottery in/of all forms and does not have a current source of revenue at this
time.
RESULTS OF OPERATION.
In 2000, we invested $335,000 in two oil and gas properties through an agreement
with LDC Operating, Inc., an unrelated third party, who owned the working
interests in the properties. We borrowed $200,000 from an individual and used
a portion of the proceeds from a stock offering to make the investment. In
August 2001, we assigned all of its rights in the properties to the lender in
satisfaction of the $200,000 debt and wrote-off the investment as a total loss.
We do not expect any significant changes in the number of our employees within
the next 12 months.
Revenues
We are considered as being a development stage company. As of the three month
and nine month periods ended September 30, 2003, we did not generate any
revenues as compared to generating no revenues for the three month and nine
month periods ended September 30, 2002.
Operating Loss
As of the three month period ended September 30, 2003, we incurred a net loss
before income taxes of $2,051 as compared to a net loss before income taxes of
$6,266 for the three month period ended September 30, 2002. This represents a
decrease in net operating losses of approximately 67%. The substantial decrease
in the net loss was a result of the decrease in our payment of professional fees
of approximately 90%.
For the nine month period ending September 30, 2003, and the nine month period
ending September 30, 2002, we incurred a net loss before income taxes of $8,306
and $10,786, respectively, representing an approximate 23% decrease in net
losses before income taxes. This decrease was primarily the result of our
decrease in professional fee expenses of approximately 59%.
We have incurred cumulative losses from March 19, 1999 (date of inception) to
September 30, 2003. At September 30, 2003, we had a cumulative deficit of
$223,941. We will continue to incur losses during the foreseeable future and
have yet to achieve any revenues with which to offset our operating expenses.
We will need additional working capital to develop our operations in our attempt
to achieve profitability. As of the date of this report, we have no agreements
or understandings with any third parties regarding additional capital, and we
cannot guarantee that we will be successful in obtaining capital upon terms
acceptable to us, if at all. We cannot
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guarantee that we will be successful in obtaining any capital upon terms
acceptable to us. Our failure to secure necessary financing could have a
material adverse effect on our financial condition and results of operations.
Additionally, for the period ended September 30, 2003, we had a total
shareholders' deficit of $23,621.
Income Taxes
We record our income taxes in accordance with Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes". We incurred net operating
losses during the nine months ended September 30, 2003 resulting in a deferred
tax asset, which has been fully allowed for; therefore, the net benefit and
expense resulted in $-0- income taxes.
Liquidity and Financial Resources
We had a negative working capital of $26,216 at the period ended September 30,
2003. For the period ended September 30, 2003, cash used in operating
activities was $6,646, as compared to $5,532 for the nine month period ended
September 30, 2002. For the nine month period ended September 30, 2003, there
was no cash used in or provided by investing activities as compared to no cash
used in or provided by investing activities for the nine month period ended
September 30, 2002. For the nine month period ended September 30, 2003,
financing activities provided $1,000 as compared to providing $11,800 in the
nine month period ended September 30, 2002. As a result, net cash decreased
by $5,646 for the nine month period ended September 30, 2003, as compared to
an increase of $6,268 for the period ended September 30, 2002.
During the nine month period ended September 30, 2003, we did not offer for sale
any equity in St. Joseph.
For the next 12 months, we propose to satisfy our cash requirements by the
generation of revenues through earned commissions on the sale of products/art.
Additionally we propose to raise capital through the issuance of up to 3,000,000
shares of our $0.001 par value common stock by virtue of a private placement
and/or acquisition. We my also explore the potential of a public offering.
ITEM 3. Controls and Procedures
(a) Evaluation of Disclosure Controls & Procedures.
Based on their evaluation as of the end of the period covered by this Form
10-QSB, the Company's president, as its principal executive officer, and
secretary/treasurer, its principal financial officer, have carried out an
evaluation of the effectiveness 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). Based upon this evaluation, the principal executive
officer and principal financial officer have concluded the Company's disclosure
controls and procedures are effective in timely informing them of material
information relating to the Company required to be disclosed in its reports
under the Securities Exchange Act of 1934.
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(b) Changes in Internal Control over Financial Reporting.
There was no change in the Company's internal control over financial reporting
during the Company's fiscal quarter covered by this Form 10-QSB that has
materially affected, or is reasonably likely to materially affect, the
Company's internal control over financial reporting.
PART II -- OTHER INFORMATION
ITEM 1. Legal Proceedings.
We have no legal proceedings in effect.
ITEM 2. Changes in Securities and Use of Proceeds.
There have been no changes in securities during this reporting period.
ITEM 3. Defaults Upon Senior Securities.
We incurred no defaults upon senior securities during this reporting period.
ITEM 4. Submission of Matters to a Vote of Security Holders.
None
ITEM 5. Other Information.
On October 27, 2003, our Board of Directors authorized the issuance of 250,000
shares of our common stock for a total consideration of $1,250 representing
$.005 per share to one (1) accredited investor.
On October 27, 2003, the Company received and accepted the resignations of
Messers. Thomas J. Waltz, Greg E. Anderson and Randel C. Gahm from the Board
of Directors. Additionally, the Board of Directors appointed Mr. John H.
Simmons as a Director of the Company. Mr. Simmons has been in the insureance,
real estate and professional Employer Organization business for over 30 years.
Mr. Simmons has held positions of District Agent and State Manager for New
England Life, Senior Consultant to Administaf, Inc., Chief Operationg Officer
of Serrios International, Inc. and Director of Lacerte Technologies, Inc.
On November 6, 2003, the Company filed in the State of Colorado, Articles of
Amendment to its Articles of Incorporation, to change its name from St. Joseph
Energy, Inc. to St. Joseph, Inc. As of the date of this report, the amendment
is under review by the State of Colorado. The change was adopted by the Board
of Directors, in which shareholder action was not required. A copy of the
submitted Articles of Amendment are filed herein as Exhibit "A".
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ITEM 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit A. Articles of Amendment to Articles of Incorporation
Exhibit 31.1 Certifications pursuant Section 302 of the Sarbanes-Oxley
Act of 2002. David O. Johnson
Exhibit 31.2 Certifications pursuant Section 302 of the Sarbanes-Oxley
Act of 2..2. Kenneth L. Johnson
Exhibit 32.1 Certifications pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002. David O. Johnson
Exhibit 32.2 Certifications pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002. Kenneth L. Johnson
(b) Form 8-K
There have been no reports filed on Form 8-K for the period.
SIGNATURES
In accordance with 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 hereunto duly authorized.
St. Joseph Energy, Inc.
_______________________
(Registrant)
/s/David O. Johnson
____________________
David O. Johnson
President
Date: November 17, 2003
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