U.S. SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549

 

 

 

FORM 10-QSB

 

 

 

[X]          Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended March 31, 20023

 

[  ]           Transition  Report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition Period from __________ to _________

 

Commission file number: 0-9435

 

 

FieldPoint Petroleum Corporation

(Exact name of small business issuer as specified in its charter)

 

Colorado                                                                                84-0811034

 

(State or other jurisdiction of                                             (I.R.S. Employer

incorporation or organization)                                           Identification No.)

 

 

1703 Edelweiss Drive

Cedar Park, Texas                                                 78613

 

(Address of principal executive offices)                          (Zip Code)

 

 

(512) 250-8692

 

(Issuer's telephone number)

 

Check whether the issuer (1) 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                       

 

 

As of April 30, 2002, the number of shares outstanding of the Registrant's $.01 par value Common Stock was 7,5830,175.

 

Transitional Small Business Disclosure Format (Check one):

Yes         No   X    

 

PART I

Item 1. Condensed Consolidated Financial Statements

FieldPoint Petroleum Corporation

 CONDENSED CONSOLIDATED BALANCE SHEETS

ASSETS

 

   March 31,

    December 31,

 

               20023                             

               20012        

CURRENT ASSETS:

          (unaudited)

 

    Cash

$                   341,705

$               351402,277460

    Trading Securities

            -

       2,880

    Derivatives

            -

     23,053

    Accounts receivable:

 

 

     Due from Stockholder

         ,

       7,500

            Oil and gas sales

                     249,857

                 28345,198907

            Joint interest billings, less allowance for doubtful

                 accounts of $99,192 and $4399,75192, respectively3 each period

 

                        65,410

 

                   3869,974275

    Prepaid expenses and other current assets

                      2,535        

                   102,535           

                                Total current assets

                     659,507

                 809720,417177

 

 

 

PROPERTY AND EQUIPMENT:

 

 

    Oil and gas properties (successful efforts method):

 

 

            Leasehold costs

                  4,714,388

            4,809677,276423

            Lease and well equipment

                    964,,190

               1,058942,777238

            Asset retirement obligation

                    364,144

                        -

    Furniture and equipment

                       35,082

                   35,082

    Transportation equipment

                     136,274

                 102,274

    Less accumulated depletion and depreciation

               (1,744,527) 

           (1,334728,353105)   

                                Net property and equipment

                  4,469,551

            4,671028,056912

 

 

 

 LONG-TERM JOINT INTEREST BILLING RECEIVABLE

                       65,184,

                   65,400184

OTHER ASSETS                                                

                      4,297     

                   134,297   

                            Total assets

$             5,198,539  

$          54,680818,170570   

 
LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

 

 

    Current portion of long-term debt

$                         728,643

$              551831,914723

    Accounts payable and accrued expenses

                        367,752

                 160473,138935

    Oil and gas revenues payable

                          79,649  

                   4963,716508   

                                Total current liabilities

                   1,   176,044

             1,376169,768166

 

 

 

LONG-TERM DEBT, net of current portion

                  ,        5,923

            1,239,874       7,897

DEFERRED INCOME TAXES

                      102,000

                   59 147,000

ASSET RETIREMENT OBLIGATIONCOMMMITMENT

                      478,103

                       -

STOCKHOLDERS’ EQUITY:

 

 

    Common stock, $.01 par value, 75,000,000 shares authorized;

 

       7,580,175 shares issued and outstanding,

 

      respectively

                       75,801

                   75,801

    Additional paid-in capital

                  2,583,887

            2,583,887

    Treasury stock, 1160,000 shares of common stock

                        (18,1600)

                    ( (18,6100)

Retained earnings

                     795,381  

                 877412,940419   

                                Total stockholders’ equity

                  3,436,469  

            3,531382,528507   

                                Total liabilities and stockholders’ equity

$              5,198,539  

$          54,680818,170570   

 

See accompanying notes to these consolidated financial statements

 

 

FieldPoint Petroleum Corporation

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

 

 

                For The Three Months Ended

 

                            March 31,                 

 

               2003                             

               2002        

REVENUE:

          (unaudited)

        (unaudited)

  Oil and gas sales

$                   598,058

$               499,396

  Well operational and pumping fees

                       29,968  

                   34,789   

                                Total revenue

                     628,026

                 534,185

 

 

 

COSTS AND EXPENSES:

 

 

  Production expense

                     300,535

                 275,086

  Depletion and depreciation

                     102,000

                 155,362

  General and administrative

                     96,065     

               146,476   

                                Total costs and expenses

                  498,600

                 576,924

 

 

 

OTHER INCOME (EXPENSE):

 

 

  Interest income (expense), net

                      (9,768)

                  (24,237)

  Miscellaneous

                         -

                    -

  Realized derivative loss

                         - (,)        

                (23,053)      

                                Total other income (expense)

                      (9,768)         

                (47,290) 

 

 

 

INCOME (LOSS) BEFORE INCOME TAXES AND CUMULATIVE EFFECT

                  119,658

                   ( 90,029)

 

 

 

INCOME TAX (PROVISION) CURRENT

                      (6,000)

                        -

INCOME TAX (PROVISION) BENEFIT DEFERRED

                  (43,000)             

                 35,000  

 

 

 

INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE

 

                      70,658

 

                  (55,029)

 

 

 

CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE

 

                      16,606

 

                        -

 

 

 

NET INCOME (LOSS)

                     54,052          

                ( 55,029)   

 

 

 

NET INCOME (LOSS) PER SHARE BEFORE ACCOUNTING CHANGE

 

 

                BASIC  

    $               (0.01)       

    $              (0.01)        

                DILUTED

    $               (0.01)       

    $              (0.01)           

 

 

 

CUMULATIVE EFFECT OF ACCOUNTING CHANGE

 

 

                BASIC

    $                *          

    $                 -       

                DILUTED

    $                *         

    $                 -          

 

 

 

WEIGHTED AVERAGE SHARES OUTSTANDING

 

 

                BASIC

              7,530,175  

            7,580,175   

                DILUTED

              7,530,175     

            7,580,175   

 

 

 

 

 

 

 

 

 

 

 

See accompanying notes to these consolidated financial statements

 

 

FieldPoint Petroleum Corporation

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

                             March 31,            

 

               2003                             

               2002        

 

          (unaudited)

        (unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

  Net income (loss)

$                   54,052

$                (55,029)

  Adjustments to reconcile to net cash

 

 

      provided by operating activities:

 

 

  Depletion and depreciation

                    102,000

                  155,362

  Deferred Income Taxes

                      43,000

                 (35,000)

  Cumulative effect of accounting change

                      16,606

                     -

  Accretion expense

                        6,194

                       -

  Changes in assets and liabilities:

 

 

            Accounts receivable

                          (175)

                  (17,072)

            Prepaid expenses and other assets

                          -

                   63,893

            Accounts payable and accrued expenses

                   (414,183)

                (117,727)

            Oil and gas revenues payable

                    324,141

                  5,584   

          Change in fair value of derivatives

                        -

                   23,053   

          Other

                        5,583   

                       -         

                Net cash provided by operating activities

                    137,218   

                   23,064   

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

  Purchase of oil and gas properties

                  (58,919)

               (24,921)   

  Purchase of other property and equipment

                  (34,000)   

                     -        

                Net cash used by investing used by investing activitiesactivities

                  (92,919)   

               (24,921)   

  Net cash used by investing activities

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

                   

                    

  Repayments of long-term debt

                (105 (129,054)516)

                 (201129,148516)

  Proceeds from exercise of options and warrants

                      -              

                244      -,437                  

                Net cash provided (used) by financing activities

                (105(129,054)516)             

              (129,516)                               43,289    

 

 

 

NET INCREASE (DECREASE) IN CASH

                  (60131,755373)

              (131,373)      73,431

 

 

 

CASH, beginning of the period

                  402351,460277           

               351,277                          649,539   

 

 

 

CASH, end of the period

  $              341219,705904,       

  $           219,904         722,970  

 

 

 

SUPPLEMENTAL INFORMATION:

 

 

   Cash paid during the period for interest

  $            25,064,      

  $              31,155      

 

 

 

 

 

 

 

See accompanying notes to these consolidated financial statements.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

 

1.        Nature of Business, Organization And Basis of Preparation And Presentation

FieldPoint Petroleum Corporation (the “Company”) is incorporated under the laws of the state of Colorado.  The Company is engaged in the acquisition, operation and development of oil and gas properties, which are located in Oklahoma, Texas, and Wyoming.

 

The Company began operations as Bass Petroleum, Inc. (Bass) in October 1989.  On December 31, 1997, the shareholders of Bass exchanged all their shares for approximately 97% (including the 6% of EPC previously purchased by Bass) of Energy Production Company (EPC), a public company, and Bass became a wholly owned subsidiary of EPC.  The management of Bass became the management of the combined company.  Concurrent with the transaction, the Company changed its name to FieldPoint Petroleum Corporation and declared a 75 to 1 reverse stock split.  Although EPC is the acquiring entity for legal purposes, Bass is considered the acquirer for accounting purposes, and the financial statements of the combined company reflect the historical accounts of Bass and include the operations of EPC beginning May 22, 1997.  However, because EPC is the acquiring entity for legal purposes, all stockholders’ equity information in the accompanying financial statements and footnotes has been restated to conform to EPC’s capital structure.

 

The condensed consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted.  However, in the opinion of management, all adjustments (which consist only of normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented have been made.  These condensed consolidated financial statements should be read in conjunction with financial statements and the notes thereto included in the Company’s Form 10-KSB filing for the year ended December 31, 20002.

 

 

2.        Stockholders EquityRecently Issued Accounting Pronouncements

On August 15, 2001, the FASB issued Statement No. 143, Accounting for Asset Retirement Obligations (“Statement 143”). Initiated in 1994 as a project to account for the cost of nuclear decommissioning, the FASB expand the scope to include similar closure or removal-type costs in other industries that are incurred at any time during the life of an asset. That standard requires entities to record the fair value of a liability for an asset retirement obligation in the period in whichDuring the period ended March 31, 2001 the president and a director of the Company exercised options at $0.10 per share to acquire 50,000 shares and 25,000 shares of common stock respectively.  In addition, warrants to purchase 199,500 shares of the Company’s common stock were exercised, netting proceeds after commissions of $236,937. 

 

 

 

1.Acquisition Of Oil and Gas Properties

1.In October 2001December 2000, the Company acquired interest in certain producing properties in Oklahoma for consideration of $733,464.1,010,015.  The acquisition was financed with an extension toof the Company’scompany’s existing borrowing facility. with a bank.  The following unaudited pro forma information is presented as if the interests in the property had been acquired on January 1, 2001:2000.

 

 

 

 

 

 

Three Months Ended

 

 

March 31,

 

 

2001

Revenues

 

$ 

Net income

 

$ 

Net income per share

 

$ 

                                                                                          ______________

                                                                                             March 31,

                                                                                                 2000

Revenues                                                                            $        582,989

Net income                                                                         $        192,404

Net income per share                                                          $               .03    

 

 

 

PART I

Item 2

 

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

 

The following discussion should be read in conjunction with the Company’s Financial Statements, and respective notes thereto, included elsewhere herein.  The information below should not be construed to imply that the results discussed herein will necessarily continue into the future or that any conclusion reached herein will necessarily be indicative of actual operating results in the future.  Such discussion represents only the best present assessment of the management of FieldPoint Petroleum Corporation.

 

General

 

FieldPoint Petroleum Corporation derives its revenues from its operating activities including sales of oil and gas and operating oil and gas properties.  The Company’s capital for investment in producing oil and gas properties has been provided by cash flow from operating activities and from bank financing. The Company categorises its operating expenses into the categories of production expenses and other expenses.  

 

Comparison of three months ended March 31, 20013 to the three months ended March 31, 20002

 

Results of Operations

 

Revenues increased 517% or $20693,8141 to $56287,934026 for the three month period ended March 31, 20013 from the comparable 20002 period. This was due to the overall increase in oil and gas productionprices.  Production volumes indecreased 456% on a BOE basis.  Average oil sales prices increasedremained stable at 74% at $2306.2463  for the period ended March 31, 20013 compared to $2617.7256 for the period ended March 31, 2002.  Average gas sales prices increased 878% to $43.342 for the three-month period ended March 31, 20013 compared to $21.3801 for the period ended March 31, 20002.

 

Production expenses increased 60% or $6519,463255 to $172294,870341 for the three month period ended March 31, 20013 from the comparable 20012 period, this was primarily due to the increase oil and gas workovers in the form of remedial repairs.  Depletion and depreciation indecreased 19952% or $7753,,894362 due to $102,000, thise was primarily due to the disposition of purchase of certain producing additional oil and gas properties, and related equipment in Oklahoma. General and administrative overhead cost indecreased 6952% or $550,84171 to $1396,954,065 for the three-month period ended March 31, 20013 from the three-month period ended March 31, 20002. This was attributable to an indecrease in salaries and administrative expense in the 20013 period.

 

Liquidity and Capital Resources

 

Cash flow provided by operating activities was $423137,974218 for the three-month period ended March 31, 20013, as compared to $16423,40964 in cash flow provided by operating activities in the 20002 period. The inincrease in cash from operating activities was primarily due to higher payable balancesnet income.

 

Cash flow used by investing activities was $393,92,832919 in the period ended March 31, 20013, compared to $424,857921 for March 31, 20002 period.  This was due to the purchase of additional oil and gas properties and equipment.  Cash flow usedprovided by financing activities was $43105,289054 for the period ended March 31, 20013, compared to cash flow used of $90129,88516 for the same period in 20002.  This indecrease was primarily due to the increasedrepayments of long term debt proceeds from the sale of common stock for the for three month period ended March 31, 20012.

 

 

 

 

 

 

  

 

PART II

 

OTHER INFORMATION

 

Item 1.  Legal Proceedings

 

None.

 

Item 2.  Changes in Securities

 

ISSUANCE OF RESTRICTED SECURTITIES. During the three months ended March 31, 2001, the Company issued 199,500 shares of Common Stock upon the exercise of warrants associated with the W.B.McKEE Securities Unit offering.

 

As to the issuance of the securities identified above, the Company relied upon Section 4(2) of the Securities Act in claiming exemption from the registered requirement of the Securities Act.None. 

     

 

Item 3.  Default 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.

 

 

 

 

 

 

SIGNATURES

 

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

Date:   5/128/20013                                   By:   /s/ Ray Reaves                                                           

Ray Reaves, Treasurer, Chief Financial Officer