UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One) | |
|
|
| |
| |
|
|
| |
Commission File No. ☒ Quarterly Report Pursuant to Section 13 Or 15(d) Of The Securities Exchange Act of 1934
For the quarterly period ended March 31, 2022
☐Transition Report Under Section 13 Or 15(d) Of The Securities Exchange Act of 1934
For the transition period ________ to ________
COMMISSION FILE NUMBER001-08675
UNITED STATES ANTIMONY CORPORATION |
(Exact name of |
Montana |
| 81-0305822 | |
(State or other jurisdiction of incorporation or organization) |
|
| |
P.O. Box 643 Thompson Falls, MT | 59873 | ||
(Address of principal executive office) | (Postal Code) | ||
P.O. Box 643, Thompson Falls, Montana(406) 827-3523
(Address of principal executive offices)
Registrant’sIssuer's telephone number: (406 )827-3523
Securities registered pursuant to Section 12(g) of the Act:number)
Title of Each Class | Trading | Name of Each Exchange on Which Registered | ||||
Common Stock, $0.01 par value | UAMY | NYSE American | ||||
CheckIndicate by check mark whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the pastpreceding 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 ☐
Indicate by check markcheckmark whether the registrant has submitted electronically and posted on its corporate Web site,Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files)filed). Yes ☒ No ☐
Indicate by check markcheckmark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “Accelerated filer a smaller reporting company or an emerging growth company. See the definitions of “largeand large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:Act (Check one):
Large Accelerated Filer | ☐ | Accelerated Filer | ☐ | ||
|
|
| ☒ | ||
Emerging Growth Company | ☐ |
IndicatedIf an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):. Yes ☐ No ☒
APPLICABLE ONLY TO CORPORATE ISSUERS:
At AugustAs of May 16, 2021, the registrant had outstanding 106,005,2342022, there were 106,240,361 shares of registrant’s common stock, $0.01 par value, $0.01 common stock.issued and outstanding.
UNITED STATES ANTIMONY CORPORATION
QUARTERLY REPORT ON FORM 10-Q
FOR THE PERIOD
ENDED JUNE 30, 2021
TABLE OF CONTENTSContents
|
| ||||
|
|
| |||
| 3 | ||||
|
|
|
| ||
|
| 15 | |||
|
|
|
| ||
|
| 21 | |||
|
|
|
| ||
|
| 22 | |||
|
|
|
| ||
|
| ||||
|
|
| |||
|
| 23 | |||
|
|
|
| ||
|
|
| 23 | ||
|
|
|
| ||
|
|
| 23 | ||
|
|
|
| ||
|
| 23 | |||
|
|
|
| ||
|
| 23 | |||
|
|
|
| ||
|
| 23 | |||
|
|
|
| ||
|
| ||||
| 24 | ||||
[The balance of this page has been intentionally left blank.]
| Page 2 of 25 |
| Table of Contents |
PART I-FINANCIALI - FINANCIAL INFORMATION
ItemITEM 1. Financial StatementsFINANCIAL STATEMENTS
UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) ASSETS June 30, 2021 December 31, 2020 Current assets: Cash and cash equivalents Certificates of deposit Accounts receivable Inventories Total current assets Properties, plants and equipment, net Restricted cash for reclamation bonds IVA receivable and other assets Total assets LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Checks issued and payable Accounts payable Accrued liabilities Payables to related party Notes payable to bank Export tax assessment payable Hillgrove advances payable (Note 12) Long-term debt, current portion Total current liabilities Long-term debt, net of current portion Hillgrove advances payable (Note 12) CARES Act note payable Stock payable to directors for services Asset retirement obligations and accrued reclamation costs Total liabilities Commitments and contingencies (Note 6 and 11) Stockholders' equity: Preferred stock $0.01 par value, 10,000,000 shares authorized: Series A: -0- shares issued and outstanding Series B: 750,000 shares issued and outstanding (liquidation preference $945,000and $937,500 respectively) Series C: 177,904 shares issued and outstanding (liquidation preference $97,847 both years) Series D: 1,751,005 shares issued and outstanding (liquidation preference $5,084,770 and $5,043,622 respectively) Common stock, $0.01 par value, 150,000,000 shares authorized; 106,005,234 and 75,949,757 shares issued and outstanding, respectively Additional paid-in capital Accumulated deficit Total stockholders' equity Total liabilities and stockholders' equity March 31, 2022 December 31, 2021 ASSETS CURRENT ASSETS Cash and cash equivalents Certificates of deposit Accounts receivable Inventories (NOTE 5) Total current assets Properties, plants and equipment, net Restricted cash for reclamation bonds IVA receivable and other assets Total assets LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable Accrued liabilities Long-term debt, current portion Total current liabilities Long-term debt, net of current portion Stock payable to directors for services Asset retirement obligations and accrued reclamation costs (NOTE 7) Total liabilities COMMITMENTS AND CONTINGENCIES (NOTE 9) STOCKHOLDERS’ EQUITY Preferred stock, $0.01 par value; 10,000,000 shares authorized: Series A: 0 shares issued and outstanding Series B: 750,000 shares issued and outstanding (liquidation preference $954,375 and $952,500, respectively) Series C: 177,904 shares issued and outstanding (liquidation preference $97,847 both periods) Series D: 1,692,672 shares issued and outstanding (liquidation preference $4,979,632) Common stock, $.001 par value; 300,000,000 shares authorized; 106,240,361 shares issued and outstanding Additional paid-in capital Accumulated deficit Total stockholders’ equity �� Total liabilities and stockholders’ equity The accompanying notes are an integral part of United States Antimony Corporation and Subsidiaries Consolidated Statements of Operations - Unaudited For the three months ended For the six months ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 REVENUES COST OF REVENUES GROSS PROFIT (LOSS) OPERATING EXPENSES: General and administrative Salaries and benefits Other operating expenses Professional fees TOTAL OPERATING EXPENSES INCOME (LOSS) FROM OPERATIONS OTHER INCOME (EXPENSE): Interest income Interest expense Gain on forgiveness of CARES Act debt (Note 14) Grant income Gain on settlement of Hillgrove advance (Note 12) TOTAL OTHER INCOME (EXPENSE) NET INCOME (LOSS) Preferred dividends Net income (loss) available to common stockholders Basic and diluted Nil Nil Weighted average shares outstanding: Basic Diluted Total Preferred Stock Common Stock Additional Paid Accumulated Total Stockholders' Three months ended June 30, 2021 Shares Amount Shares Amount In Capital Deficit Equity Balances, April 1, 2021 Common stock issued upon exercise of warrants Net income Balances, June 30, 2021 Total Preferred Stock Common Stock Additional Paid Accumulated Total Stockholders' Three months ended June 30, 2020 Shares Amount Shares Amount In Capital Deficit Equity Balances, April 1, 2020 Issuance of common stock to Directors Net loss Balances, June 30, 2020 Total Preferred Stock Common Stock Additional Paid Accumulated Total Stockholders' Six months ended June 30, 2021 Shares Amount Shares Amount In Capital Deficit Equity Balances, January 1, 2021 Issuance of common stock for cash Common stock issuance costs Common stock issued upon exercise of warrants Net income Balances, June 30, 2021 Total Preferred Stock Common Stock Additional Paid Accumulated Total Stockholders' Six months ended June 30, 2020 Shares Amount Shares Amount In Capital Deficit Equity Balances, January 1, 2020 Issuance of common stock upon exercise of warrants Issuance of common stock to Directors Net loss Balances, June 30, 2020 For the three months ended March 31, 2022 March 31, 2021 REVENUE COST OF REVENUE GROSS PROFIT OPERATING EXPENSES: General and administrative Salaries and benefits Other operating expenses Professional fees TOTAL OPERATING EXPENSES INCOME (LOSS) FROM OPERATIONS OTHER INCOME (EXPENSE) Interest expense Interest income TOTAL OTHER INCOME (EXPENSE) NET INCOME (LOSS) Preferred dividends Net income (loss) available to common stockholders Net income (loss) per share of common stock: Basic and diluted $ Nil Weighted average shares outstanding: Basic Diluted The accompanying notes are an integral part of United States Antimony Corporation and Subsidiaries Consolidated Statements of Cash Flows - Unaudited For the six months ended June 30, 2021 June 30, 2020 Cash Flows From Operating Activities: Net income (loss) Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities: Depreciation and amortization Accretion of asset retirement obligation Common stock payable for directors fees Gain on settlement of Hillgrove advance Gain on forgiveness of Cares Act debt Write-down of inventory to net realizable value Other non-cash items Change in: Accounts receivable Inventories IVA receivable and other assets Accounts payable Accrued liabilities Export tax assessment payable Payables to related parties Net cash (used) by operating activities Cash Flows From Investing Activities: Proceeds from redemption of certificates of deposit Purchase of properties, plants and equipment Net cash provided (used) by investing activities Cash Flows From Financing Activities: Change in checks issued and payable Payments on advances from related party Proceeds from note payable-SBA Proceeds from issuance of common stock, net of issuance costs Proceeds from exercise of warrants Payments on Hillgrove advances payable Borrowing on notes payable to bank Principal paid on notes payable to bank Principal payments of long-term debt Net cash provided by financing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH Cash and cash equivalents and restricted cash at beginning of period Cash and cash equivalents and restricted cash at end of period NONCASH INVESTING AND FINANCING ACTIVITIES: Common stock payable issued to directors Payable to related party satisfied with exercise of stock UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) For the three months ended March 31, 2022 and 2021 Total Preferred Stock Common Stock Total Stockholders’ Shares Amount Shares Amount Paid in Capital Deficit Equity BALANCE, December 31, 2020 Common shares issued for cash Common stock issuance costs Common stock issued for exercise of warrants Net loss BALANCE, March 31, 2021 BALANCE, December 31, 2021 Net income BALANCE, March 31, 2022 The accompanying notes are an integral part of For the three months ended March 31, 2022 March 31, 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) Adjustments to reconcile net loss to net cash used by operating activities Depreciation and amortization Accretion of asset retirement obligation Common stock payable for directors fees Write-down of inventory to net realizable value Other non-cash items Changes in operating assets and liabilities: Accounts receivable Inventories IVA receivable and other assets Accounts payable Accrued liabilities Export tax assessment payable Payable to related parties Net cash provided (used) by operating activities CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of properties, plants and equipment Net cash used by investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Change in checks issued and payable Payments on advances from related party Proceeds from issuance of common stock, net of issuance costs Proceeds from exercise of warrants Principal paid on notes payable to bank Principal payments of long-term debt Net cash provided (used) by financing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD CASH AND CASH EQUIVALENTS AT END OF PERIOD The accompanying notes are an integral part of these condensed consolidated unaudited financial statements. UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) March 31, 2022 NOTE 1 - NATURE OF OPERATIONS AGAU Mines, Inc., predecessor of United States Antimony Corporation (“USAC” or “the Company”), was incorporated in June 1968 as a Delaware corporation to mine gold and United States Antimony Corporation and SubsidiariesConsolidated Balance Sheets (Unaudited)June 30, 2021 and December 31, 2020$ 22,364,607 $ 665,102 44,028 254,212 601,315 238,634 566,711 650,213 23,576,661 1,808,161 10,898,313 11,225,594 57,275 57,275 223,874 208,472 $ 34,756,123 $ 13,299,502 $ 0 $ 86,685 1,357,304 1,876,874 542,699 635,626 16,994 227,432 0 100,000 0 1,120,730 0 378,074 25,300 52,122 1,942,297 4,477,543 33,200 34,304 0 756,147 0 443,400 166,250 110,000 293,451 291,719 2,435,198 6,113,113 0 0 7,500 7,500 1,779 1,779 17,509 17,509 1,060,051 759,496 63,883,227 39,050,899 (32,649,141 ) (32,650,794 ) 32,320,925 7,186,389 $ 34,756,123 $ 13,299,502 $ 21,334,353 $ 21,363,048 259,210 259,210 1,475,853 891,314 1,026,980 1,055,420 24,096,396 23,568,992 11,102,124 11,133,733 57,281 57,281 283,744 242,721 $ 35,539,545 $ 35,002,727 $ 1,107,574 $ 1,385,752 624,817 621,873 12,287 13,230 1,744,678 2,020,855 198,806 201,920 140,625 112,500 300,381 298,649 2,384,490 2,633,924 0 0 7,500 7,500 1,779 1,779 16,926 16,926 1,062,402 1,062,402 63,991,459 63,991,459 (31,925,011 ) (32,711,263 ) 33,155,055 32,368,803 $ 35,539,545 $ 35,002,727 thethese condensed consolidated unaudited financial statements. Page 3 Table of Contents$ 2,275,562 $ 1,585,191 $ 3,528,849 $ 3,328,182 2,079,164 1,601,252 3,120,294 3,243,066 196,398 (16,061 ) 408,555 85,116 290,111 117,959 460,161 319,922 77,278 111,178 153,937 206,147 0 25 184,037 24,250 61,199 32,652 184,336 117,610 428,588 261,814 982,471 667,929 (232,190 ) (277,875 ) (573,916 ) (582,813 ) 13,389 31 21,882 835 (880 ) (6,439 ) (3,135 ) (11,187 ) 443,400 0 443,400 0 0 10,000 0 10,000 113,422 0 113,422 0 569,331 3,592 575,569 (352 ) 337,141 (274,283 ) 1,653 (583,165 ) (12,162 ) (12,162 ) (24,325 ) (24,325 ) $ 324,979 $ (286,445 ) $ (22,672 ) $ (607,490 ) Net loss per share of common stock $ (0.01 ) $ (0.01 ) 106,315,419 70,177,677 99,513,378 69,937,144 108,696,704 70,177,677 99,513,378 69,937,144 The accompanying notes are an integral part of the consolidated financial statements.4 25Table of Contents United States Antimony Corporation and SubsidiariesUNITED STATES ANTIMONY CORPORATION AND SUBSIDIARIESConsolidated Statement of Changes in Stockholders' EquityCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)For the periods ended June 30, 2021 and June 30, 2020(Unaudited)2,678,909 $ 26,788 105,963,567 $ 1,059,634 $ 63,856,560 $ (32,986,282 ) $ 31,956,700 - - 41,667 417 26,667 0 27,084 - 0 - 0 0 337,141 337,141 2,678,909 $ 26,788 106,005,234 $ 1,060,051 $ 63,883,227 $ (32,649,141 ) $ 32,320,925 2,678,909 $ 26,788 69,911,436 $ 699,114 $ 37,167,730 $ (29,672,872 ) $ 8,220,760 - 0 295,463 2,954 127,529 0 130,483 - 0 - 0 0 (274,283 ) (274,283 ) 2,678,909 $ 26,788 70,206,899 $ 702,068 $ 37,295,259 $ (29,947,155 ) $ 8,076,960 2,678,909 $ 26,788 75,949,757 $ 759,496 $ 39,050,899 $ (32,650,794 ) $ 7,186,389 - 0 26,290,000 262,900 24,734,100 0 24,997,000 - 0 - 0 (1,654,820 ) 0 (1,654,820 ) - 0 3,765,477 37,655 1,753,048 0 1,790,703 - 0 - 0 0 1,653 1,653 2,678,909 $ 26,788 106,005,234 $ 1,060,051 $ 63,883,227 $ (32,649,141 ) $ 32,320,925 2,678,909 $ 26,788 69,661,436 $ 696,614 $ 37,107,730 $ (29,363,990 ) $ 8,467,142 - 0 250,000 2,500 60,000 0 62,500 - - 295,463 2,954 127,529 0 130,483 - 0 - 0 0 (583,165 ) (583,165 ) 2,678,909 $ 26,788 70,206,899 $ 702,068 $ 37,295,259 $ (29,947,155 ) $ 8,076,960 $ 3,580,306 $ 1,253,287 2,440,918 1,041,130 1,139,388 212,157 160,681 170,050 73,135 76,659 3,915 184,037 122,077 123,137 359,808 553,883 779,580 (341,726 ) (2,982 ) (2,255 ) 9,654 8,493 6,672 6,238 786,252 (335,488 ) (11,819 ) (12,162 ) $ 774,432 $ (347,650 ) 0.01 106,240,361 92,711,336 106,389,761 92,711,336 thethese condensed consolidated unaudited financial statements. 5Page 4 of 25Table of Contents $ 1,653 $ (583,165 ) 442,408 449,648 1,732 4,386 56,250 61,733 (113,422 ) 0 (443,400 ) 0 66,054 0 0 (48 ) (362,681 ) 50,817 17,448 39,890 (15,402 ) (43,952 ) (519,570 ) (256,368 ) (92,927 ) (23,668 ) (1,120,730 ) 0 (154,022 ) 21,405 (2,236,609 ) (279,322 ) 210,184 0 (115,127 ) (200,166 ) 95,057 (200,166 ) (86,685 ) 142,530 (56,416 ) (46,160 ) 0 443,400 23,342,180 0 1,790,703 0 (1,020,799 ) 0 0 (31,135 ) (100,000 ) (21,238 ) (27,926 ) 0 23,841,057 487,397 21,699,505 7,909 722,377 172,767 $ 22,421,882 $ 180,676 $ 0 $ 130,483 $ 0 $ 62,500 Additional Accumulated 2,678,909 $ 26,788 75,949,757 $ 759,496 $ 39,050,899 $ (32,650,794 ) $ 7,186,389 - 0 26,290,000 262,900 24,734,100 0 24,997,000 - 0 - 0 (1,654,820 ) 0 (1,654,820 ) - 0 3,723,810 37,238 1,726,381 0 1,763,619 - 0 - 0 0 (335,488 ) (335,488 ) 2,678,909 $ 26,788 105,963,567 $ 1,059,634 $ 63,856,560 $ (32,986,282 ) $ 31,956,700 2,620,576 $ 26,205 106,240,361 $ 1,062,402 $ 63,991,459 $ (32,711,263 ) $ 32,368,803 - 0 - 0 0 786,252 786,252 2,620,576 $ 26,205 106,240,361 $ 1,062,402 $ 63,991,459 $ (31,925,011 ) $ 33,155,055 thethese condensed consolidated unaudited financial statements. 6Page 5 of 25Table of Contents PART I - FINANCIAL INFORMATION, CONTINUED:United States Antimony Corporation and SubsidiariesNotes to Consolidated Financial Statements (Unaudited)1.UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARIESBasis of PresentationCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)The unaudited consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America for interim financial information, as well as the instructions to Form 10‑Q. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of the Company’s management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation of the interim financial statements have been included. Operating results for the three and six month periods ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2021.For further information refer to the financial statements and footnotes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.Going Concern ConsiderationAt June 30, 2021, the Company’s consolidated financial statements show working capital of approximately $21.6 million and an accumulated deficit of approximately $32.6 million. The Company has incurred losses for the past two fiscal years which are principally a result of the Company’s antimony operations due to both depressed antimony prices and production costs incurred in Mexico. To improve conditions, the Company continues searching for areas to reduce these production costs.In the first six months of 2021, the Company raised net proceeds of approximately $23.3 million from sale of shares of its common stock and approximately $1.8 million from the exercise of stock purchase warrants. These funds have been and will continue to be used for general corporate purposes, working capital, hiring of additional labor, leverage for reducing legacy contracts, additional managerial staff at USAC and BRZ headquarters, a revised website including measures aimed at increased visibility for advertising, more labor at its Mexican smelter, repair and improved infrastructure at the Mexican smelter, potential securement of additional antimony mine reserves in Mexico, and improvement of furnaces in Montana. With the funds raised, management believes the Company has sufficient funds to sustain its operations and meet its financial obligations during the 12 months following the date of issuance of these consolidated financial statements.2.Developments in Accounting PronouncementsAccounting Standards Updates AdoptedIn December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The update contains a number of provisions intended to simplify the accounting for income taxes. The update was adopted as of January 1, 2021, and its adoption did not have a material impact on the Company’s$ 786,252 $ (335,488 ) 220,150 222,464 1,732 1,732 28,125 28,125 0 57,530 0 (661 ) (584,539 ) (298,933 ) 28,440 (125,067 ) (41,023 ) (50,546 ) (278,178 ) (582,360 ) 2,944 (80,998 ) 0 (1,120,730 ) 0 (164,922 ) 163,903 (2,449,854 ) (188,541 ) (23,298 ) (188,541 ) (23,298 ) 0 (86,685 ) 0 (56,216 ) 0 23,342,180 0 1,763,619 0 (100,000 ) (4,057 ) (12,518 ) (4,057 ) 24,850,380 (28,695 ) 22,377,228 21,420,329 722,377 $ 21,391,634 $ 23,099,605 7Page 6 of 25Table of Contents Subsidiaries
During 2000, the Company formed a 75% owned subsidiary, Bear River Zeolite Company (“BRZ”), to mine and market zeolite and zeolite products from a mineral deposit in southeastern Idaho. In 2001, an operating plant was constructed at the zeolite site and zeolite production and sales commenced. During 2002, the Company acquired the remaining 25% of BRZ and continued to produce and sell zeolite products.
During 2005, the Company formed a 100% owned subsidiary, Antimonio de Mexico S.A. de C.V. (“AM”), to explore and develop potential antimony properties in Mexico.
During 2006, the Company acquired 100% ownership in United States Antimony, Mexico S.A. de C.V. (“USAMSA”), which became a wholly-owned subsidiary of the Company.
In 2018, the Company acquired 100% ownership in Stibnite Holding Company US Inc. (previously Lanxess Holding Company US Inc.), Antimony Mining and Milling US LLC (previously Lanxess Laurel US LLC), a Delaware limited liability company and Lanxess Laurel de Mexico, S.A. de C.V (“Lanxess Laurel Mexico”), a Mexico corporation, both of which became a wholly-owned subsidiary of the Company.
In its operations in Montana, the Company produces antimony oxide, antimony metal, and precious metals. Antimony oxide is a fine, white powder that is used primarily in conjunction with a halogen to form a synergistic flame-retardant system for plastics, rubber, fiberglass, textile goods, paints, coatings and paper. Antimony oxide is also used as a color fastener in paint, as a catalyst for production of polyester resins for fibers and film, as a catalyst for production of polyethylene pthalate in plastic bottles, as a phosphorescent agent in fluorescent light bulbs, and as an opacifier for porcelains. The Company also sells antimony metal for use in bearings, storage batteries and ordnance.
In its operations in Idaho, the Company produces zeolite, a group of industrial minerals used in a variety of purposes including soil amendment and fertilizer. Zeolite is also used for water filtration, sewage treatment, nuclear waste and other environmental cleanup, odor control, gas separation and other miscellaneous applications.
Notes to Consolidated Financial Statements (Unaudited)NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
|
|
In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of March 31, 2022, and its results of operations for
|
|
|
|
|
| Three months ended June 30, |
|
| Six Months Ended June 30, |
| ||||||||||
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||
Numerator: |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net income (loss) available to shareholders |
| $ | 324,979 |
|
| $ | (286,445 | ) |
| $ | (22,672 | ) |
| $ | (607,490 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares outstanding |
|
| 106,315,419 |
|
|
| 70,177,677 |
|
|
| 99,513,378 |
|
|
| 69,937,144 |
|
Incremental shares |
|
| 2,381,285 |
|
|
| - |
|
|
| - |
|
|
| - |
|
Diluted weighted average shares outstanding |
|
| 108,696,704 |
|
|
| 70,177,677 |
|
|
| 99,513,378 |
|
|
| 69,937,144 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic EPS |
| $ | Nil |
|
| $ | (0.01 | ) |
| $ | Nil |
|
| $ | (0.01 | ) |
Diluted EPS |
| $ | Nil |
|
| $ | (0.01 | ) |
| $ | Nil |
|
| $ | (0.01 | ) |
For the three months ended June 30,March 31, 2022, and 2021, common stock equivalent shares consistedand cash flows for the three months ended March 31, 2022 and 2021. The condensed consolidated balance sheet at December 31, 2021, was derived from audited annual financial statements but does not contain all of stock warrants and werethe footnote disclosures from the annual financial statements.
These unaudited interim financial statements have been prepared by management in accordance with generally accepted accounting principles used in the United States of America (“U.S. GAAP”). These unaudited interim financial statements should be read in conjunction with the annual audited financial statements included in the calculationCompany’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission on March 31, 2022.
This summary of diluted earnings per share. Forsignificant accounting policies of the six months ended June 30, 2021Company is presented to assist in understanding the Company’s financial statements. The financial statements and threenotes are representations of the Company’s management, which is responsible for their integrity and six month periods ended June 30, 2020, we had no common stock equivalent shares that were dilutive.objectivity. These accounting policies conform to U.S. GAAP and have been consistently applied in the preparation of the financial statements.
| Table of Contents |
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited)
|
March 31, 2022 |
Reclassifications
Certain reclassifications have been made to conform prior periods’ amounts to the current presentation. These reclassifications have no effect on the results of operations, stockholders’ equity and cash flows as previously reported.
COVID -19
The Company’s operations and business have experienced disruption due to the unprecedented conditions surrounding the COVID-19 pandemic spreading throughout the United States and elsewhere, causing disruptions to the Company’s business operations and management. These disruptions are most evident in the Company’s ability to retain and house employees and properly manage them while maintaining proper social distancing and with delays in obtaining materials and supplies.
The effects of the continued outbreak of COVID-19 and related government responses could also include extended disruptions to supply chains and capital markets, reduced availability of contractors and a prolonged reduction in economic activity. These effects could have a variety of adverse impacts on the Company, including its ability to conduct operations.
The Company has taken steps to mitigate the potential risks to suppliers and employees posed by the spread of COVID-19, including work from home policies where appropriate. The Company will continue to monitor developments affecting both its workforce and contractors, and will take additional precautions as necessary. The ultimate impact of COVID-19 depends on factors beyond management’s knowledge or control, including its duration and third-party actions to contain its spread and mitigate its public health effects. Therefore, the Company cannot estimate the potential future impact to its financial position, results of operations and cash flows, but the impacts could be material.
New Accounting Pronouncements
Accounting standards that have been issued or proposed by the Financial Accounting Standards Board (“FASB”) that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.
NOTE 3– EARNINGS PER SHARE
Basic Earnings Per Share (“EPS”) is computed as net income (loss) available to common stockholders divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options and warrants.
For the three months ended March 31, 2022, the calculation of diluted income per common share included 149,400 warrants to purchase one share of common stock. At March 31, 2022 and 2021, the potentially dilutive common stock equivalents not included in the calculation of diluted earnings per share as their effect would have been anti-dilutive are as follows:
|
| March 31, 2022 |
|
| March 31, 2021 |
| ||
Warrants |
|
| 9,400,207 |
|
|
| 2,471,089 |
|
Convertible preferred stock |
|
| 1,692,672 |
|
|
| 1,751,005 |
|
TOTAL POSSIBLE DILUTIVE SHARES |
|
| 11,092,879 |
|
|
| 4,222,094 |
|
NOTE 4 – REVENUE RECOGNITION
Products consist of the following:
|
| Antimony: includes antimony oxide, sodium antimonate, antimony trisulfide and antimony metal |
|
| Zeolite: includes coarse and fine zeolite crushed in various sizes |
|
| Precious |
|
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||
|
| June 30, |
|
| June 30, |
| ||||||||||
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||
Antimony |
| $ | 1,428,939 |
|
| $ | 910,484 |
|
| $ | 2,086,046 |
|
| $ | 2,031,909 |
|
Zeolite |
|
| 716,428 |
|
|
| 612,715 |
|
|
| 1,236,375 |
|
|
| 1,172,075 |
|
Precious metals |
|
| 130,195 |
|
|
| 61,992 |
|
|
| 206,428 |
|
|
| 124,198 |
|
|
| $ | 2,275,562 |
|
| $ | 1,585,191 |
|
| $ | 3,528,849 |
|
| $ | 3,328,182 |
|
|
|
| Three Months Ended |
|
| Six Months Ended |
| ||||||||||
|
| June 30, |
|
| June 30, |
| ||||||||||
|
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||
United States |
| $ | 1,983,443 |
|
| $ | 1,436,047 |
|
| $ | 3,148,956 |
|
| $ | 3,002,284 |
|
Canada |
|
| 292,119 |
|
|
| 149,144 |
|
|
| 379,893 |
|
|
| 325,898 |
|
|
| $ | 2,275,562 |
|
| $ | 1,585,191 |
|
| $ | 3,528,849 |
|
| $ | 3,328,182 |
|
|
|
| For the Three Months Ended |
|
| For the Six Months Ended |
| ||||||||||
Sales to |
| June 30, |
|
| June 30, |
|
| June 30, |
|
| June 30, |
| ||||
Largest Customers |
| 2021 |
|
| 2020 |
|
| 2021 |
|
| 2020 |
| ||||
Company A |
|
| 191,421 |
|
|
| 176,081 |
|
|
| 489,571 |
|
|
| 290,372 |
|
Company B |
|
| 702,597 |
|
|
| 0 |
|
|
| 702,597 |
|
|
| 213,322 |
|
Company C |
|
| 190,557 |
|
|
| 0 |
|
|
| 518,226 |
|
|
| 523,660 |
|
Company D |
|
| 194,247 |
|
|
| 0 |
|
|
| 194,247 |
|
|
| 0 |
|
|
| $ | 1,278,822 |
|
| $ | 176,081 |
|
| $ | 1,904,641 |
|
| $ | 1,027,354 |
|
% of Total Revenues |
|
| 56.20 | % |
|
| 11.11 | % |
|
| 53.97 | % |
|
| 30.87 | % |
|
| Table of Contents |
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited)
|
|
|
|
|
|
| |||||
Largest Accounts Receivable |
| June 30, 2021 |
|
| December 31, 2020 |
| ||
| Company B |
| $ | 172,841 |
|
| $ | 0 |
|
| Company E |
|
| 27,716 |
|
|
| 0 |
|
| Company F |
|
| 33,609 |
|
|
| 68,055 |
|
|
| $ | 234,166 |
|
| $ | 68,055 |
|
| % of Total Receivables |
|
| 38.94 | % |
|
| 28.52 | % |
Sales of products for the three-months ended March 31, 2022 and 2021 were as follows:
|
|
|
|
|
| For the three months ended |
| |||||
|
| March 31, 2022 |
|
| March 31, 2021 |
| ||
Antimony |
| $ | 2,828,930 |
|
| $ | 657,107 |
|
Zeolite |
|
| 674,042 |
|
|
| 519,947 |
|
Precious metals |
|
| 77,334 |
|
|
| 76,233 |
|
TOTAL REVENUE BY PRODUCT |
| $ | 3,580,306 |
|
| $ | 1,253,287 |
|
|
| June 30, 2021 |
|
| December 31, 2020 |
| ||
Antimony Metal |
| $ | 0 |
|
| $ | 268,100 |
|
Antimony Oxide |
|
| 216,020 |
|
|
| 67,377 |
|
Antimony Ore |
|
| 185,123 |
|
|
| 95,880 |
|
Total antimony |
|
| 401,143 |
|
|
| 431,357 |
|
Zeolite |
|
| 165,568 |
|
|
| 218,856 |
|
|
| $ | 566,711 |
|
| $ | 650,213 |
|
The Company’s trade accounts receivable balance related to contracts with customers was $1,475,853 at March 31, 2022 and $891,314 at December 31, 2021. The Company’s products do not involve any warranty agreements and product returns are not typical.
NOTE 5– INVENTORIES Inventories at March 31, 2022 and December 31, 2021 consisted primarily of finished antimony products, antimony metal, antimony ore, and finished zeolite products that are stated at the lower of first-in, first-out cost or estimated net realizable value. Finished antimony products, antimony metal and finished zeolite products costs include raw materials, direct labor and processing facility overhead costs and freight. Inventories at March 31, 2022 and December 31, 2021 are as follows:
Antimony oxide and metal inventory consisted of finished product held at the Company’s plants in Montana and Mexico. Antimony concentrates and ore were held primarily at sites in Mexico. The Company’s zeolite inventory consists of saleable zeolite material. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Table of Contents |
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited)
|
|
|
|
|
|
|
| 2021 |
|
| 2020 |
| ||
Promissory note payable to First Security Bank of Missoula, |
|
|
|
|
|
| ||
bearing interest at 3.150%, payable on demand, collateralized |
|
|
|
|
|
| ||
by a lien on Certificate of Deposit |
| $ | 0 |
|
| $ | 99,999 |
|
|
|
|
|
|
|
|
|
|
Promissory note payable to First Security Bank of Missoula, |
|
|
|
|
|
|
|
|
bearing interest at 3.150%, payable on demand, collateralized |
|
|
|
|
|
|
|
|
by a lien on Certificate of Deposit |
|
| 0 |
|
|
| 1 |
|
|
|
|
|
|
|
|
|
|
Total notes payable to the bank |
| $ | 0 |
|
| $ | 100,000 |
|
NOTE 6 – PROPERTIES, PLANTS AND EQUIPMENT
The major components of the Company’s properties, plants and equipment by segment at March 31, 2022 and December 31, 2021 are shown below:
At March 31, 2022 and December 31, 2021, the Company had $956,965 and $665,175, respectively, of assets that were not yet placed in service and have not yet been depreciated. NOTE 7 – ASSET RETIREMENT OBLIGATION AND ACCRUED RECLAMATION COSTS Changes in the asset retirement obligation for the three months ended March 31, 2022 and 2021 are as follows:
The Company’s total asset retirement obligation and accrued reclamation costs of $300,318 and $298,649, at March 31, 2022 and December 31, 2021, respectively, include reclamation obligations for the Idaho and Montana operations of $107,500. |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Table of Contents |
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited), Continued:
|
|
|
| June 30, |
|
| December 31, |
| |||
|
| 2021 |
|
| 2020 |
| ||
|
|
|
|
|
|
| ||
Note payable to Zeo Inc., non interest bearing, |
|
|
|
|
|
| ||
payable in 11 quarterly installments of $8,300 with a final payment of $8,700; |
|
|
|
|
|
| ||
maturing December 2022; uncollateralized. |
| $ | 58,500 |
|
| $ | 66,800 |
|
Note payable to Cat Financial Services, bearing interest at 6%; |
|
|
|
|
|
|
|
|
payable in monthly installments of $778; maturing |
|
|
|
|
|
|
|
|
December 2022; collateralized by equipment. |
|
| 0 |
|
|
| 17,480 |
|
|
|
|
|
|
|
|
|
|
Note payable to Phyllis Rice, bearing interest |
|
|
|
|
|
|
|
|
at 1%; payable in monthly installments of $2,000; originally maturing |
|
|
|
|
|
|
|
|
March 2015; collateralized by equipment. |
|
| 0 |
|
|
| 2,146 |
|
|
|
| 58,500 |
|
|
| 86,426 |
|
Less current portion |
|
| (25,300 | ) |
|
| (52,122 | ) |
Long-term portion |
| $ | 33,200 |
|
| $ | 34,304 |
|
NOTE 8 – DEBT
Long term debt at March 31, 2022 and December 31, 2021 is as follows: |
12 Months Ending June 30, |
| Principal Payment |
| |
2022 |
|
| 25,300 |
|
2023 |
|
| 33,200 |
|
|
| $ | 58,500 |
|
|
| March 31, 2022 |
|
| December 31, 2021 |
| ||
Promissory note payable to First Security Bank of Missoula, bearing interest at 2.25%, payable in 59 monthly installments of $1,409 with a final payment of $152,726 maturing November 9, 2026; collateralized by a lien on Certificate of Deposit |
| $ | 211,093 |
|
| $ | 215,150 |
|
Less current portion |
|
| (12,287 | ) |
|
| (13,230 | ) |
Long term portion |
| $ | 198,806 |
|
| $ | 201,920 |
|
At March 31, 2022, principal payments on debt are due as follows: Twelve months ending March 31, Principal payment 2023 2024 2025 2026 2027 NOTE 9 – COMMITMENTS AND CONTINGENCIES From time to time, the Company is assessed fines and penalties by the Mine Safety and Health Administration (“MSHA”). Using appropriate regulatory channels, management may contest these proposed assessments. At March 31, 2022 and December 31, 2021, the Company had accrued liabilities of $1,270 and $Nil, respectively, relating to such assessments, which is included in accrued liabilities on the condensed consolidated balance sheets. The Company pays various royalties on the sale of zeolite products. On a combined basis, royalties vary from 8%-13%. During the three months ended March 31, 2022 and 2021, the Company incurred royalty expense of $62,030 and $62,130, respectively. Royalty expense is included in cost of goods sold on the Statement of Operations. At March 31, 2022 and December 31, 2021, the Company had accrued royalties payable of $381,054 and $346,242, respectively, which is included in accrued liabilities on the condensed consolidated balance sheets. The Company is currently in negotiations with certain royalty holders to modify the terms of the agreements. NOTE 10 – STOCKHOLDERS’ EQUITY During the three months ended March 31, 2021, the Company sold shares of its common stock in two separate transactions: on February 3, 2021, 15,300,000 shares were sold at $0.70 for gross proceeds of $10,710,000; and on February 18, 2021, 10,990,000 shares were sold at $1.30 for gross proceeds of $14,287,000. A total of $1,654,820 of issuance costs were incurred on these sales. During the three months ended March 31, 2021, the Company issued 3,723,810 shares of common stock and received $1,763,619 in cash from the exercise of warrants. During the three months ended March 31, 2022 and March 31, 2021, the Company expensed $28,125 and $28,125, respectively, in directors’ fees payable that will be paid in common stock. The Company issued no shares of common stock during the three months ended March 31, 2022. |
| |||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||
| Table of Contents |
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited), Continued:
|
|
|
|
| Number of Warrants |
|
| Exercise Prices |
| ||
Balance December 31, 2019 |
|
| 702,041 |
|
| $0.25 - $0.65 |
| |
Issued |
|
| 5,742,858 |
|
| $ | 0.46 |
|
Exercised |
|
| (250,000 | ) |
| $ | 0.25 |
|
Balance December 31, 2020 |
|
| 6,194,899 |
|
| $0.46 - $0.65 |
| |
Issued |
|
| 10,060,500 |
|
| $0.46 - $0.85 |
| |
Exercised |
|
| (3,765,477 | ) |
| $0.46 - $0.65 |
| |
Balance June 30, 2021 |
|
| 12,489,922 |
|
| $0.46- $0.85 |
| |
Common stock warrants
In February 2021, concurrent with sale of common stock, the Company issued warrants to purchase 7,650,000 shares of common stock at an exercise price of $0.85 per share. The warrants are initially exercisable six months following issuance and expire five and one-half years from the issuance date. In connection with the February 2021 sales of common stock, the Company also issued 1,606,500 warrants with an exercise price of $0.85 and 804,000 warrants with an exercise price of $0.46 as commission to the placement agent. |
|
Shares |
|
| Exercise Price |
|
| Expiration Date | |||
| 143,707 |
|
| $ | 0.65 |
|
| 2022 | |
| 2,285,715 |
|
| $ | 0.46 |
|
| 2026 | |
| 9,256,500 |
|
| $ | 0.85 |
|
| 2026 | |
| 804,000 |
|
| $ | 0.46 |
|
| 2026 | |
| 12,489,922 |
|
|
|
|
|
|
| |
The Company issued no warrants to purchase common stock during the three months ended March 31, 2022.
The following is a summary of the Company’s warrants to purchase shares of common stock activity:
|
| Number of warrants |
|
| Exercise prices |
| ||
Balance outstanding at December 31, 2020 |
|
| 6,194,899 |
|
| $ | 0.65 |
|
Issued |
|
| 10,060,500 |
|
| $0.46 - $0.85 |
| |
Exercised |
|
| (3,765,477 | ) |
| $0.46 - $0.65 |
| |
Balance outstanding at December 31, 2021 and March 31, 2022 |
|
| 12,489,922 |
|
| $ | 0.75 |
|
The composition of the Company’s warrants outstanding at March 31, 2022 is as follows:
Number of warrants |
|
| Exercise Price |
|
| Expiration Date |
| Remaining life (years) |
| |||
| 143,707 |
|
| $ | 0.65 |
|
| 8/12/2022 |
|
| 0.37 |
|
| 2,285,715 |
|
|
| 0.46 |
|
| 7/31/2025 |
|
| 3.34 |
|
| 804,000 |
|
|
| 0.46 |
|
| 1/27/2026 |
|
| 3.83 |
|
| 7,650,000 |
|
|
| 0.85 |
|
| 3/8/2026 |
|
| 4.35 |
|
| 1,606,500 |
|
|
| 0.85 |
|
| 2/1/2026 |
|
| 3.84 |
|
| 12,489,922 |
|
|
|
|
|
|
|
|
|
|
|
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited), Continued:NOTE 11 – BUSINESS SEGEMENTS
|
|
|
United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited), Continued:
|
|
|
|
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The Company is currently organized and managed by four segments, which represent our operating units: United States antimony operations, Mexican antimony operations, precious metals recovery and United States zeolite operations.
The Puerto Blanco mill and the Madero smelter at the Company’s Mexico operation bring antimony up to an intermediate or finished stage, which may be sold directly or shipped to the United States operation for finishing at the Thompson Falls, Montana plant. The Puerto Blanco mill in Mexico is the site of our crushing and flotation plant, and a cyanide leach plant which will recover precious metals after the ore goes through the crushing and flotation cycles. A precious metals recovery plant is operated in conjunction with the antimony processing plant at Thompson Falls, Montana, where a 99% precious metals mix will be produced. The zeolite operation produces zeolite near Preston, Idaho. Almost all of the sales of products from the United States antimony and zeolite operations are to customers in the United States, although the Company does have a sales operation in Canada.
Segment operations for the three months ended March 31, 2022 Antimony - USA Antimony -Mexico Total antimony Precious Metals Zeolite Total Total revenues Depreciation and amortization Income (loss) from operations Other income (expense) NET INCOME (LOSS)
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This quarterly report and the exhibits attached hereto contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements concern the Company’s anticipated results and developments in the Company’s operations in future periods, planned exploration and development of its properties, plans related to its business and other matters that may occur in the future. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Any statement that expresses or involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always using words or phrases such as “expects” or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “estimates”, or “intends”, or states that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ from those expressed or implied by the forward-looking statements, including, without limitation:
This list is not exhaustive of the factors that may affect the Company’s forward-looking statements. Some of the important risks and uncertainties that could affect forward-looking statements are described further under the sections titled “Risk Factors”, “Description of Business” and “Management’s Discussion and Analysis and Plan of Operation” of this Quarterly Report. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, believed, estimated or expected. The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. United States Antimony Corporation disclaims any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, except as required by law. The Company advises readers to carefully review the reports and documents filed from time to time with the Securities and Exchange Commission (the “SEC”), particularly the Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. United States Antimony Corporation
As used in this Quarterly Report, the terms “we,” “us,” “our,” “United State Antimony Corporation,”, “US Antinomy “and the “Company”, mean United States Antimony Corporation, unless otherwise indicated. All dollar amounts in this Quarterly Report are expressed in U.S. dollars, unless otherwise indicated. Management’s Discussion and Reports to Security Holders
The Registrant does not issue annual or quarterly reports to DESCRIPTION OF BUSINESS History United States Antimony Corporation, or USAC, was incorporated in Montana in January 1970 to mine and produce antimony products. In December 1983, we suspended antimony mining operations but continued to produce antimony products from domestic and foreign sources. In April 1998, we formed United States Antimony SA de CV or USAMSA, to mine and smelt antimony in Mexico. Bear River Zeolite Company, or BRZ, was incorporated in 2000, and it is mining and producing zeolite in southeastern Idaho. On August 19, 2005, USAC formed Antimonio de Mexico, S. A. de C. V. to explore and develop antimony and silver deposits in Mexico. Our principal business is the production and sale of antimony, silver, gold, and zeolite products. On May 16, 2012, we started trading on the NYSE MKT (now NYSE AMERICAN) under the symbol UAMY. Antimony Division Our antimony smelter and precious metals plant is located in the Burns Mining District of Sanders County, Montana, approximately 15 miles west of Thompson Falls, MT. We hold 2 patented mill sites where the plant is located. We have no “proven reserves” or “probable reserves” of antimony, as these terms are defined by the Securities and Exchange Commission. Environmental restrictions preclude mining at this site. Mining was suspended in December 1983, because antimony could be purchased more economically from foreign sources. For 2021, and since 1983, we relied on foreign sources for raw materials, and there are risks of interruption in procurement from these sources and/or volatile changes in world market prices for these materials that are not controllable by us. We have sources of antimony in Mexico but we are still depending on foreign companies for raw material in the future. We expect to receive raw materials from our owned and leased properties for 2022 and later years. We continue working with suppliers in North America, Central America, and South America. We currently own 100% of the common stock, equipment, and the leases on real property of United States Antimony, Mexico S.A. de C.V. or “USAMSA”, In our existing operations in Montana, we produce antimony oxide, antimony metal, and precious metals. Antimony oxide is a fine, white powder that is used primarily in conjunction with a halogen to form a synergistic flame-retardant system for plastics, rubber, fiberglass, textile goods, paints, coatings and paper. Antimony oxide is also used as a color fastener in paint, as a catalyst for production of polyester resins for fibers and film, as a catalyst for production of polyethylene pthalate in plastic bottles, as a phosphorescent agent in fluorescent light bulbs, and as an opacifier for porcelains. We also sell antimony metal for use in bearings, storage batteries and ordnance.
We estimate (but have not independently confirmed) that our present share of the domestic market and international market for antimony oxide products is approximately 4% and less than 1%, respectively. We are the only significant U.S. producer of antimony products, while China supplies 92% of the world antimony demand. We believe we are competitive both domestically and world-wide due to the following:
Zeolite Division We own 100% of Bear River Zeolite Company, (BRZ, an Idaho corporation) that was incorporated on June 1, 2000. BRZ has a lease with Webster Farm, L.L.C. that entitles BRZ to surface mine and process zeolite on property located near Preston, Idaho, in exchange for a royalty payment. In 2010 the royalty was adjusted to $10 per ton sold. The current minimum annual royalty is $60,000. In addition, BRZ has more zeolite on U.S. Bureau of Land Management land. The Company pays various royalties on the sale of zeolite products. William Raymond and Nancy Couse are paid a royalty that varies from $1 to $5 per ton. On a combined basis, royalties vary from 8%-13% of sales. Shortly after inception BRZ constructed a processing plant on the property which improved its productive capacity. Ground-breaking for an additional warehouse to store additional inventory and a shop to service equipment started in 2021 and the warehouse and shop are expected to be completed by mid-2022. A vertical-shaft-impactor crusher was replaced by a hammer mill for crushing line number 1 in 2021 for increased production rate. A replacement jaw crusher was installed and put into service in 2021. The new jaw crusher was further improved with a variable-speed apron feeder in late 2021 and subsequent and substantial improvements have been made to the jaw crusher in 2022. In 2021, the Company purchased a house in Preston Idaho for the express purpose of housing workers for its zeolite operation. We have no reserves nor resources of zeolite, as these terms are defined by the Securities and Exchange Commission. “Zeolite” refers to a group of industrial minerals that consist of hydrated aluminosilicates that hold cations such as calcium, sodium, ammonium, various heavy metals, and potassium in their crystal lattice. Water is loosely held in cavities in the lattice. BRZ zeolite is regarded as one of the best zeolites in the world due to its high CEC of approximately 180-220 meq/100 gr., its hardness and high clinoptilolite content, its absence of clay minerals, and its low sodium content. BRZ’s zeolite deposits’ characteristics which make the mineral useful for a variety of purposes including:
SELECTED FINANCIAL DATA. Statement of Operations Information:
Balance Sheet Information:
Total revenue from antimony increased $2,171,823 to $2,828,930 for the three months ended March 31, 2022 compared to $657,107 for the comparable prior period ending March 31, 2021. The increase is attributed to an increase in average sales price of $2.92 coupled with an increase of 251, 3851 pound in volume of antimony sold during the three months ended March 31, 2022 compared to the three months ended March 31, 2021. Gross profit improved from $87,467 (17.3% of revenue) for the three months ended March 31, 2021 to $1,055,777 (60.6% of revenue) for the three months ended March 31, 2022. The company experienced increased labor costs for the current three-month period relative to the same timeframe in the prior year. A portion of that increase is due to resuming more normalized production levels in 2022 compared to 2021, while a portion is attributable to higher costs of attracting workers. The Company previously increased it starting wage to attract workers during 2021 and the effects thereof impact current cost of goods sold. While it is difficult to
The Montana operating team continues to improve and Zeolite Financial and operational performance of zeolite for the three months ended March 31, 2022 and 2021 was as follows:
Sales volume of zeolite for the three months ended March 31, 2022 increased 283 tons over the three months ended March 31, 2021. Average sales price per ton increased $33.20 for the same comparable period. Total revenue from zeolite sales increased $154,095 for the three months ended March 31, 2022 to Gross profit for the three months ended March 31, 2022 decreased $42,264 to $33.797 compared to $76,061 for the three months ended March 31, 2021. The Company incurred equipment maintenance expense in the amount of $38,965 during the three months ended March 31, 202 compared to $788 for the three months ended March 31, 2021 when the Company deferred certain expenses in anticipation of closing its capital raise. Precious Metals Financial and operational performance of precious metals for the three months ended March 31, 2022 and 2021 was as follows:
EARNINGS BEFORE INTEREST TAX DEPRECIATION AND AMORTIZATION The Company utilizes Earnings Before Interest Taxes Depreciation and Amortization (“EBITDA”), a non-GAAP financial measurement which approximates free cash flow. Our company-wide Earnings Before Interest Taxes Depreciation Amortization (“EBITDA”) was a $1,009,384 for the three months ended March 31, 2022, compared to a negative EBITDA of $110,769 for the three months ended March 31, 2021.
As of March 31, 2022, the Company had cash on hand of $21,334,353.
For the
The
At
Management of
There
PART II - OTHER INFORMATION
United States Antimony Corporation is not a party to any material legal proceedings, and, to Management’s knowledge, no such proceedings are threatened or contemplated. No director, officer or affiliate of United States Antimony Corporation and no owner of record or beneficial owner of more than 5% of the Company’s securities or any associate of any such director, officer or security holder is a party adverse to United States Antimony Corporation or has a material interest adverse to United States Antimony Corporation in reference to pending litigation. ITEM 1A. RISK FACTORS. There have been no material changes from the risk factors as previously disclosed in the Company’s Form 10-K for the year ended December 31, 2021 which was filed with the SEC on March 31, 2022. ITEM 2. RECENT SALES OF UNREGISTERED SECURITIES. For the three months ended March 31, 2022, the Company sold no common stock. During the three months ended March 31, 2022, neither the Company nor any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) purchased any shares of our Common Stock, the only class of the Company’s equity securities registered pursuant to section 12 of the Exchange Act at the date of this filing. ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None
Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. The information concerning mine safety violations or other regulatory matters required by Section 1503 (a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this Annual Report.
ITEM 6. EXHIBITS.
In accordance with Rule 402 of Regulation S-T, the XBRL information included in Exhibit 101 to this Form 10-Q shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
SIGNATURES
Pursuant to the requirements of
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||