UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 30, 2015

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________________________________to______________________________________

Commission file number 1-7602

Excalibur Industries

(Exact name of registrant as specified in its charter)

Utah		87-0292122
State or other jurisdiction of incorporation or organization		(I.R.S. Employer Identification No.)

Post Office Box 650, Hibbing, Minnesota		55746
(Address or principal executive offices)		(Zip Code)

218-262-6127

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate 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).

YES ¨ NO x

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated files, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨ Accelerated filer ¨

Non-accelerated filer ¨(Do not check if a smaller reporting company) Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). YES ¨ NO x

Number of shares of issuer’s common stock outstanding at November 30, 2015: 6,012,361

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

CONSOLIDATED BALANCE SHEET

(Unaudited)

	For the Period Ended:
CURRENT ASSETS	Nov. 30, 2015			Aug. 31, 2015
Cash and Cash Equivalents	$	481,868		$	359,571
Marketable Securities		16,803			16,986
Total Prepaid Insurance		26,796			6,699
Total Current Assets	$	525,467		$	383,256

Fixed Assets
Interest in Mining Properties		100,000			100,000

Deposits		60			60

TOTAL ASSETS	$	625,527		$	483,316

LIABILITIES & SHAREHOLDERS’ EQUITY
Accounts Payable	$	160,788		$	189,038

TOTAL LIABILITIES	$	160,788		$	189,038

STOCKHOLDERS’ EQUITY
Common Stock $.01 Par Value, Authorized 10,000,000 Shares 6,012,361 Shares issued including shares in Treasury		60,124			60,124
Paid-In Capital in excess of Par		83,810			83,810
Retained Earnings		304,490			134,029
Accumulated Other Comprehensive Income		16,420			16,420
Treasury Stock		(105	)		(105	)

TOTAL SHAREHOLDERS’EQUITY	$	464,739		$	294,278

TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY	$	625,527		$	483,316

See accompanying Notes.

CONSOLIDATED SATEMENTS OF INCOME, EXPENSE

AND RETAINED EARNINGS

FOR THE FISCAL QUARTERS ENDED

(Unaudited)

INCOME	Nov. 30, 2015			Nov. 30, 2014
Royalty Income	$	358,888		$	0

TOTAL INCOME	$	358,888		$	0

OPERATING EXPENSES
General and Administrative	$	69,881		$	65,159
Professional Services		118,493			1,336
Property, Payroll and Other Taxes		0			0
TOTAL OPERATING EXPENSES	$	188,374		$	66,495

OTHER INCOME/(EXPENSE)
Interest Expense	$	0		$	0
Interest and Dividend Income		45			1,121
Gain/(Loss) on Sale of Marketable Securities		(98	)		(13,795	)

TOTAL OTHER INCOME	$	(53	)	$	(12,674	)

NET INCOME/(LOSS)		170,461			(79,169	)

Retained Earnings Beginning of Period		134,029			(375,877	)

Retained Earnings End of Period		304,490			(455,046	)

Average Shares Outstanding During Period		6,012,361			6,012,361

NET GAIN/(LOSS) PER SHARE	$	0.02835		$	(0.07569	)

NOTES TO CONSOLIDATED FINANCIAL STAT

EMENTS

Note 1 - Summary of Significant Accounting Policies Consolidation

The consolidated financial statements presented herein include the accounts of Excalibur Industries (“Excalibur”) and its wholly owned subsidiary, Mountain West Mines, Inc. (“Mountain West”), a Nevada corporation, qualified to do business in the state of Wyoming. All significant intercompany transactions have been eliminated from these statements.

Note 2 - Mining Properties and Interests

Excalibur and its subsidiary, Mountain West Mines, Inc., hold various mineral rights interests that are carried at a reporting value of $100,000 for financial statement purposes.

Note 3 - Operating Funds

For the past several years, administrative costs have been defrayed under a plan developed by management to insure that Excalibur would continue to meet its obligations until the anticipated royalty income stream was realized. As part of that plan, Excalibur entered in to a Management Services Agreement with Meriden Engineering LLC (“Meriden”) in 2012 to perform certain management and consulting services with respect to mine performance and progress and royalty payment determinations, among others. Meriden has agreed to defer payments under this agreement until such a time that Excalibur has adequate funds. As of November 30, 2015, Meriden was owed $25,567.69. With the onset of the royalty income stream in the first quarter of 2015, Excalibur now expects to liquidate the accumulated debt owed to Meriden by February 2016, and Meriden’s management fee will be 5% of the gross royalty revenue received by the Company. Extraordinary events or issues beyond the scope of the budget will be negotiated between Meriden and the Company as additional compensation. In addition, as an incentive, 5% of actual gross increase in the Company’s consolidated revenues during each calendar year from all sources other than royalties shall be paid to Meriden. In the event the Company is sold, all deferred compensation will be paid in full, and in addition, a one-time termination fee in the amount of $250,000 will be paid to Meriden.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks, uncertainties and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to, statements regarding estimation of uranium production and pricing, which are based on information from the uranium producers who are planning to produce uranium from lands in which the Company holds a royalty interest. Actual results and future developments could differ materially from the results or developments expressed in or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, volatility of uranium prices, market supply and demand, competition, environmental hazards, health and safety conditions, regulation or government action, litigation and uncertainties about estimates of reserves. For a discussion of the factors, including without limitation, those that could materially and adversely affect Excalibur’s actual results and performance, see “Risk Factors” set forth on Page 4 of Excalibur’s Annual Report on Form 10-K for the fiscal year ended May 31, 2015. Excalibur undertakes no obligation, other than that imposed by law, to make any revisions to the forward-looking statements contained in this filing or to update them to reflect circumstances occurring after the date of this filing.

This discussion should be read in conjunction with the condensed financial statements and notes presented in this Quarterly Report on Form 10-Q and the financial statements and notes in the last filed Annual Report on Form 10-K filed for the period ended May 31, 2015 for a full understanding of the Company’s financial position.

Background

Excalibur Industries (“Excalibur”) is a Utah corporation formed by the consolidation of Tower Enterprises (formerly Moab Uranium Company) and The Thrifty Helper on June 1, 1971. In January 1972, Excalibur purchased all of the issued and outstanding shares of capital stock of Mountain West Mines, Inc. (“Mountain West”), a Nevada corporation, which is now a wholly owned subsidiary of Excalibur. Excalibur and Mountain West are hereinafter collectively referred to as Excalibur or Company.

Excalibur is a natural resource business enterprise focused on uranium, an industry that has seen a long period of volatility in production and pricing following the 1979 incident at the Three Mile Island power station and 2011 earthquake and tsunami that struck Japan, crippling the Fukushima-Daiichi atomic power plant, and leading to the shutdown of nearly all reactors in the country. However, most industry analysts continue to forecast a positive future for the industry, including an increase in pricing of yellowcake, in the long term.

Current Activity

Excalibur’s uranium position in the Powder River Basin is maintained by royalty agreements held by Excalibur with two uranium producers, Energy Fuels, Inc., which acquired Uranerz Energy Corporation in June 2015 (“Energy Fuels”) and Cameco Corporation (“Cameco”).

With the acquisition of Uranerz Energy Corporation, Energy Fuels now operates the uranium processing facility at the Nichols Ranch property, in which Excalibur holds a royalty interest (6% or 8% depending on the spot price of uranium). The Nichols Ranch facility was commissioned in April 2014, and uranium production began in June 2014. Energy Fuels/Uranerz produced a total of 76,376 pounds of uranium concentrate (“yellowcake”) from the Nichols Ranch in the third calendar quarter of 2015, resulting in a royalty payment of $167,171.79. Production from the Nichols Ranch is expected to be about 377,000 pounds in 2015. The timing and amount of production by Energy Fuels/Uranez are subject to change and beyond the control of Excalibur.

Cameco continues uranium production from its facility at the North Butte property, in which Excalibur holds a 4% royalty interest. The royalty to be paid to Excalibur is based on Cameco’s quarterly average realized uranium price as reported in Cameco’s filings with the Securities and Exchange Commission. Cameco produced 109,903.6 pounds of uranium concentrate from the North Butte in the third calendar quarter of 2015, resulting in a royalty payment of $191,715.85. Cameco is expected to produce about 329,000 pounds of uranium concentrate from the North Butte in 2015. Again, the timing and amount of production reported by Cameco are subject to change and are beyond the control of Excalibur.

Excalibur owes $100,000.00 to Cliffs Natural Resources under a 2009 Settlement Agreement and Release. This obligation will be repaid in two annual installments of $50,000.00 beginning in December 2015.

Executive Compensation. Jay R. Mackie, Excalibur’s President and CEO, is compensated at the rate of $11,000.00 per month, and Michael P. Johnson, Excalibur’s Secretary and Treasurer, is compensated at the rate of $1,250.00 per month. All 2015 executive compensation is deferred until December 15, 2015. As of November 30, 2015, $132,000.00 was owed to Mr. Mackie and $15,000 .00 was owed to Mr. Johnson for 2015 compensation.

Severance Pay. Severance payments of $300,000.00 to Excalibur’s former president, Joseph P. Hubert, and $100,000.00 to Excalibur’s former secretary/treasurer, Marguerite Emanuel, were approved by the Board of Directors in 2013. These severance payments are deferred until the Company’s financial position allows payment. As of November, 2015, $250,000.00 was owed to Mr. Hubert and $85,000.00 was owed to Ms. Emanuel. This obligation is expected to be satisfied by February 2016.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 4. Controls and Procedures.

During the most recently completed fiscal quarter ended November 30, 2015, there were no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to affect, the Company’s internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

The Company currently is not a party to any material legal proceedings and, to management’s knowledge, no such proceedings are threatened or contemplated.

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

The following exhibits are attached to this Quarterly Report on Form 10-Q:

Exhibit Number		Description
31.1-2		Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act
32.1-2		Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Excalibur Industries

Date: January 6, 2016	By:	/s/ Jay R. Mackie
		Jay R. Mackie
		President, Chief Executive Officer (Principal Executive Officer)


Date: January 6, 2016	By:	/s/ Michael P. Johnson
		Michael P. Johnson
		Secretary and Treasurer (Principal Financial Officer)

EXCALIBUR INDUSTRIES 10-Q