10-Q 1 ed10q1a.txt CALIFORNIA-ENGELS MINING COMPANY 10Q, 3/31/2001 SECURITIES AND EXCHANGE COMMISSION Washington D. C. 20549 Form 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended March 31, 2001 Commission File No. 1-3871 CALIFORNIA-ENGELS MINING COMPANY (Exact name of registrant as specified in its charter) State of California (State or other jurisdiction of incorporation or organization) 94-0357560 (I.R.S. Employer Identification Number) Address: 117 Crescent Street, P. O. Box 778, Greenville, California 95947-0778 (Address of principal executive office) (Zip Code) (530) 284-6191 (Registrant's telephone number including area code) 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 X No CLASS Capital Stock, par value: $0.25 per share. OUTSTANDING AT MARCH 31, 2001: 760,815.94 shares. Filing Contains 9 pages. CALIFORNIA-ENGELS MINING COMPANY BALANCE SHEETS (Unaudited) PART I FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS ASSETS

LIABILITIES AND STOCKHOLDERS' EQUITY

CALIFORNIA-ENGELS MINING COMPANY BALANCE SHEETS (Unaudited) STOCKHOLDER'S EQUITY

CALIFORNIA-ENGELS MINING COMPANY STATEMENTS OF OPERATIONS (Unaudited)

CALIFORNIA-ENGELS MINING COMPANY STATEMENTS OF CASH FLOWS (Unaudited)

CALIFORNIA-ENGELS MINING COMPANY STATEMENTS OF CASH FLOWS (Unaudited)

FIXED ASSET SUMMARY

CALIFORNIA-ENGELS MINING COMPANY NOTES TO FINANCIAL STATEMENTS NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying financial statements are unaudited but, in the opinion of the management, include all adjustments, consisting solely of normal items, necessary for a fair presentation. Interim results are not necessarily indicative of results for a full year. These financial statements should be read in conjunction with the financial statements and notes which are included in the Company's Annual Report on Form 10-K for the year ended December 31, 2000. The accounting policies set forth in those annual financial statements are the same as the accounting policies utilized in the preparation of these financial statements, except as modified for appropriate interim financial statement presentation. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS Liquidity and Capital Resources During the 30 years its mining properties were leased, the Company endeavored to increase working capital, total assets and shareholder's equity in the event that its lessee, Placer Dome U.S. Inc., terminated its Mining Lease and Option to Purchase agreement and return the mining properties to the Company. This event occurred effective April 20, 1993. Thus, funds were available to begin preparation of a Non-Industrial Timber Management Plan which was approved by the California Department of Forestry and became effective July 2, 1999. The objective of the Company is to earn income from the sale of its timber so funds are available for the maintenance of its mining properties and the implementation of its timber management plan. The Company filed a Notice of Timber Operations pursuant to its Non-Industrial Timber Management Plan on September 7 and December 15, 2000 for a mechanical thinning/biomass project on its Engels and Smith parcels. Thinning began on the Lower Engels portion on December 11, 2000 and was completed there and on the Smith parcel by January 18, 2001. Following the winter, the project continues on the much larger Upper Engels portion after preparation of the road to Upper Camp for log and chip truck hauling. The Henry Timber Harvest Plan was approved December 18, 2000. Harvesting and hauling began on January 10 and was completed January 19, 2001. Results of Operations The Company had net gain, for the three months ending March 31, of $7,432 in 2001, compared to net loss of $3,569 in the 2000 period. The change in net income for the first three months of 2001 compared with the corresponding period in 2000 was due to revenue from timber thinning and harvest projects. The Company's principal sources of income are office management and bookkeeping fees, sale of timber, interest, dividends, capital gains on the sale of real estate and sale of rock and sand. There is no assurance that any of the sources of income will continue at current rates into the future. CALIFORNIA-ENGELS MINING COMPANY NOTES TO FINANCIAL STATEMENTS Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995 The matters discussed in this report on Form 10-Q, when not historical matters, are forward-looking statements that involve a number of risks and uncertainties that could cause actual results to differ materially from projected results. Such risks, trends and uncertainties include the highly cyclical nature of the forest products industry, general economic conditions, competition, price conditions or trends for the Company's products, elimination of import tariffs, the possibility that timber supply could increase if governmental, environmental or endangered species policies change, and the limitations on the Company's ability to harvest its timber due to adverse natural conditions or increased governmental restrictions. These and other risks are described from time to time in the Company's filings with the Securities and Exchange Commission. Many of these factors are beyond the Company's ability to control or predict. The Company disclaims any intent or obligation to update its forward-looking statements, whether as a result of receiving new information, the occurrence of future events, or otherwise. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Commodity Prices The Company's earnings and cash flow may be significantly impacted by changes in the market price of timber. Timber prices fluctuate and may be affected by numerous factors, such as seasonal demand, production levels, economic policies of central banks, interest rates and producer hedging. PART II - OTHER INFORMATION Item 1. Legal Proceedings. None 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 SIGNATURE 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. CALIFORNIA-ENGELS MINING COMPANY Registrant May 8, 2001 By: /s/ Norman A. Lamb Norman A. Lamb, President and Chief Executive Officer May 8, 2001 By: /s/ James E. Brousseau James E. Brousseau, Secretary- Treasurer and Chief Financial Officer

CALIFORNIA ENGELS MINING CO 10-Q