UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934. For the quarterly period ended June 30, 2002 |
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| or | ||
 |
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the transition period from to |
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| Commission file number 000-30586 |
| Yukon, Canada (State or other jurisdiction of incorporation or organization) |
Not applicable (I.R.S. Employer Identification No.) |
Suite 654 — 999 Canada Place
Vancouver, British Columbia, Canada
V6C 3E1
(Address of principal executive office)
(604) 688-8323
(registrant’s telephone number, including area code)
Former Name, Former Address and Former Fiscal Year, if Change 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 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
The number of shares of the registrant’s capital stock outstanding as of June 30, 2002 was 144,630,818 Common Shares, no par value.
Page 1 of 16
TABLE OF CONTENTS
| Page | ||||||||
PART I |
Financial Information | |||||||
Item 1 |
Financial Statements | |||||||
| Consolidated Condensed Balance Sheets at June 30, 2002 | ||||||||
| (unaudited) and December 31, 2001 | 3 | |||||||
| Unaudited Consolidated Condensed Statements of Loss and | ||||||||
| Deficit for the Three Month and Six Month Periods Ended June 30, | ||||||||
| 2002 and 2001 | 4 | |||||||
| Unaudited Consolidated Condensed Statements of Cash Flow | ||||||||
| for the Three Month and Six Month Periods Ended June 30, | ||||||||
| 2002 and 2001 | 5 | |||||||
| Notes to the Unaudited Consolidated Condensed Financial | ||||||||
| Statements | 6 | |||||||
Item 2 |
Management's Discussion and Analysis of Financial Condition | |||||||
| and Results of Operations | 8 | |||||||
PART II |
Other Information | |||||||
Item 1 |
Legal Proceedings | 13 | ||||||
Item 2 |
Changes in Securities and Use of Proceeds | 13 | ||||||
Item 3 |
Defaults Upon Senior Securities | 13 | ||||||
Item 4 |
Submission of Matters To a Vote of Securityholders | 13 | ||||||
Item 5 |
Other Information | 13 | ||||||
Item 6 |
Exhibits and Reports on Form 8-K | 13 | ||||||
Page 2 of 16
Part I — Financial Information
Item 1 Financial Statements
IVANHOE ENERGY INC.
Consolidated Condensed Balance Sheets
(stated in thousands of U.S. Dollars)
| June 30, 2002 | December 31, 2001 | |||||||
| (unaudited) | (audited) | |||||||
Assets
|
||||||||
Current Assets
|
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Cash |
$ | 5,632 | $ | 9,697 | ||||
Accounts receivable |
3,245 | 1,938 | ||||||
Other |
228 | 375 | ||||||
| 9,105 | 12,010 | |||||||
Long Term Assets |
462 | 397 | ||||||
Oil and gas properties, equipment and GTL investments |
99,523 | 91,596 | ||||||
| $ | 109,090 | $ | 104,003 | |||||
Liabilities and Stockholders' Equity |
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Current Liabilities
|
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Accounts payable and accrued liabilities |
$ | 3,171 | $ | 5,974 | ||||
Convertible debenture |
1,000 | 1,000 | ||||||
| 4,171 | 6,974 | |||||||
Provision for site restoration |
180 | 132 | ||||||
Shareholders’ Equity |
||||||||
Share capital, issued 144,631,000 common shares; |
||||||||
December 31, 2001 139,267,000 |
130,862 | 120,392 | ||||||
Deficit |
(26,123 | ) | (23,495 | ) | ||||
| 104,739 | 96,897 | |||||||
| $ | 109,090 | $ | 104,003 | |||||
(see accompanying notes)
Page 3 of 16
IVANHOE ENERGY INC.
Unaudited Consolidated Condensed Statements of Loss and Deficit
(stated in thousands of U.S. Dollars except per share data)
| Three Months | Six Months | |||||||||||||||
| Ended June 30, | Ended June 30, | |||||||||||||||
| 2002 | 2001 | 2002 | 2001 | |||||||||||||
Revenue |
||||||||||||||||
Oil and gas revenue |
$ | 1,981 | $ | 2,278 | $ | 3,644 | $ | 4,433 | ||||||||
Interest income |
43 | 138 | 72 | 486 | ||||||||||||
| 2,024 | 2,416 | 3,716 | 4,919 | |||||||||||||
Expenses |
||||||||||||||||
Operating costs |
1,012 | 1,073 | 1,868 | 2,015 | ||||||||||||
General and administrative (including Project Identification) |
1,401 | 2,870 | 2,988 | 4,841 | ||||||||||||
Depletion and depreciation |
718 | 436 | 1,488 | 919 | ||||||||||||
Provision for impairment |
— | 5,000 | — | 5,000 | ||||||||||||
| 3,131 | 9,379 | 6,344 | 12,775 | |||||||||||||
Net loss |
1,107 | 6,963 | 2,628 | 7,856 | ||||||||||||
Deficit, beginning of period |
25,016 | 3,266 | 23,495 | 2,373 | ||||||||||||
Deficit, end of period |
$ | 26,123 | $ | 10,229 | $ | 26,123 | $ | 10,229 | ||||||||
Net Loss per share |
$ | 0.01 | $ | 0.05 | $ | 0.02 | $ | 0.06 | ||||||||
Weighted Average Number of Shares (in thousands) |
140,493 | 127,319 | 139,979 | 127,159 | ||||||||||||
(see accompanying notes)
Page 4 of 16
IVANHOE ENERGY INC.
Unaudited Consolidated Condensed Statements of Cash Flow
(stated in thousands of U.S. Dollars)
| Three Months | Six Months | |||||||||||||||
| Ended June 30, | Ended June 30, | |||||||||||||||
| 2002 | 2001 | 2002 | 2001 | |||||||||||||
Operating Activities |
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Net loss |
$ | (1,107 | ) | $ | (6,963 | ) | $ | (2,628 | ) | $ | (7,856 | ) | ||||
Items not requiring use of cash |
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Depletion and depreciation |
718 | 436 | 1,488 | 919 | ||||||||||||
Provision for impairment |
— | 5,000 | — | 5,000 | ||||||||||||
| (389 | ) | (1,527 | ) | (1,140 | ) | (1,937 | ) | |||||||||
Changes in non-cash working capital items |
(2,252 | ) | 3,455 | (2,376 | ) | 3,192 | ||||||||||
| (2,641 | ) | 1,928 | (3,516 | ) | 1,255 | |||||||||||
Investing Activities |
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Capital spending
|
(5,144 | ) | (13,627 | ) | (11,832 | ) | (25,735 | ) | ||||||||
Proceeds from sale of Daqing project |
— | — | 1,200 | — | ||||||||||||
| (5,144 | ) | (13,627 | ) | (10,632 | ) | (25,735 | ) | |||||||||
Financing Activities
|
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Shares issued on private placement |
9,964 | — | 9,964 | — | ||||||||||||
Shares issued on exercise of options |
50 | 41 | 119 | 228 | ||||||||||||
| 10,014 | 41 | 10,083 | 228 | |||||||||||||
Increase (Decrease) in cash for the period |
2,229 | (11,658 | ) | (4,065 | ) | (24,252 | ) | |||||||||
Cash, beginning of period |
3,403 | 17,100 | 9,697 | 29,694 | ||||||||||||
Cash, end of period |
$ | 5,632 | $ | 5,442 | $ | 5,632 | $ | 5,442 | ||||||||
Supplementary Information
Regarding Non-Cash Transactions
|
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Investing activities, net assets acquired: |
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Oil and gas properties |
$ | — | $ | 2,978 | $ | — | $ | 2,978 | ||||||||
Accounts receivable |
— | 200 | — | 200 | ||||||||||||
| $ | — | $ | 3,178 | $ | — | $ | 3,178 | |||||||||
Financing activities, non-cash: |
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Shares issued as consideration |
$ | — | $ | 3,178 | $ | — | $ | 3,178 | ||||||||
Included in the above are the following: |
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Interest paid |
$ | 18 | $ | 8 | $ | 35 | $ | 16 | ||||||||
Decrease (increase) in non-cash working capital items
|
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Accounts receivable |
$ | (378 | ) | $ | (9 | ) | $ | |||||||||