United States Antimony (UAMY) - 2020 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1: Financial Statements (unaudited) The unaudited Q1 2020 financial statements report a $308,882 net loss, negative working capital, and an accumulated deficit, raising substantial doubt about the company's going concern Consolidated Balance Sheets As of March 31, 2020, total assets slightly decreased to $13.43 million, with stockholders' equity declining to $8.22 million and negative working capital of approximately $2.8 million Consolidated Balance Sheet Summary (Unaudited) | Balance Sheet Items | March 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | Total Current Assets | $1,149,865 | $1,279,755 | | Total Assets | $13,431,992 | $13,693,975 | | Total Current Liabilities | $3,939,675 | $3,975,681 | | Total Liabilities | $5,211,232 | $5,226,833 | | Total Stockholders' Equity | $8,220,760 | $8,467,142 | - The company reported negative working capital of approximately $2.8 million as of March 31, 2020[19] Consolidated Statements of Operations For Q1 2020, revenues decreased to $1.74 million, but the company achieved a gross profit of $101,177 and reduced its net loss to $308,882 year-over-year Consolidated Statement of Operations Summary (Unaudited) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Revenues | $1,742,991 | $2,456,365 | | Gross Profit (Loss) | $101,177 | $(69,053) | | Income (Loss) from Operations | $(302,946) | $(683,767) | | Net Loss | $(308,882) | $(707,460) | | Net Loss per Share | Nil | $(0.01) | Consolidated Statements of Cash Flows Net cash used in operating activities improved to $36,265 in Q1 2020, while investing activities used $96,271, resulting in an overall $92,438 decrease in cash and cash equivalents Cash Flow Summary (Unaudited) | Cash Flow Activity | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Net cash used by operating activities | $(36,265) | $(85,590) | | Net cash provided (used) by investing activities | $(96,271) | $87,432 | | Net cash provided (used) by financing activities | $40,098 | $(14,988) | | Net decrease in cash and cash equivalents | $(92,438) | $(13,146) | Notes to Consolidated Financial Statements Significant notes to the financial statements indicate substantial doubt about the company's going concern due to recurring losses and negative working capital, alongside details on revenue streams, a Mexican tax assessment, and a subsequent PPP loan - The company's financial statements show negative working capital of approximately $2.8 million and an accumulated deficit of $29.7 million, indicating substantial doubt about its ability to continue as a going concern[19] Sales by Product (Q1 2020 vs Q1 2019) | Product | Q1 2020 Sales | Q1 2019 Sales | | :--- | :--- | :--- | | Antimony | $1,121,425 | $1,705,823 | | Zeolite | $559,360 | $726,015 | | Precious metals | $62,206 | $24,527 | - The Mexican tax authority (SAT) assessed the company approximately $696,000 USD for the 2013 tax year, which the company has appealed believing the findings have no merit[46][47] - An advance payable balance of $1,134,221 to Hillgrove Mines includes $378,074 classified as current, anticipating a potential stop notice in 2020 that would trigger repayment[51] - Subsequent to quarter end, on April 22, 2020, the company received a $443,400 loan under the Paycheck Protection Program (PPP)[58] Item 2: Management's Discussion and Analysis of Results of Operations and Financial Condition Management attributes the Q1 2020 net loss of $308,882 to supply issues and lower antimony prices, while focusing on cost reduction and anticipating improved cash flow from new precious metals operations, despite ongoing COVID-19 and going concern risks - Operational changes implemented to mitigate COVID-19 spread could adversely impact results, with the full financial impact remaining uncertain[59] Company-Wide Performance (Q1 2020 vs Q1 2019) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Gross Revenue | $1,742,991 | $2,456,365 | | Net Loss | $(308,882) | $(707,460) | | EBITDA | $(82,601) | $(484,187) | - The company's ability to continue as a going concern is in doubt due to negative working capital ($2.8 million), an accumulated deficit ($29.7 million), and a history of losses[76] - Management anticipates improved cash flow in the second half of 2020 from precious metals sales extracted from the new Mexican leach circuit[78] Antimony Segment Performance The antimony segment experienced a significant downturn in Q1 2020, with sales volume decreasing by 33% and average prices falling 20%, resulting in a net loss of $482,629 despite improved cost control Antimony Sales and Pricing (Q1 2020 vs Q1 2019) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Total Lbs of Antimony Metal Sold | 295,453 Lbs | 443,148 Lbs | | Average Sales Price/Lb Metal | $3.06/Lb | $3.85/Lb | | Total Revenue | $1,121,425 | $1,705,823 | | Net Loss - Antimony | $(482,629) | $(874,426) | Precious Metals Segment Performance The precious metals segment showed strong growth in Q1 2020, with revenue increasing to $62,206 and net income rising to $38,608, as the company prepares for pilot production from its Los Juarez project in Q3 2020 Precious Metals Sales (Q1 2020 vs Q1 2019) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Gold Ounces Sold | 15 Ounces | 6 Ounces | | Silver Ounces Sold | 5,048 Ounces | 1,724 Ounces | | Gross Revenue | $62,206 | $24,527 | | Net Income | $38,608 | $7,516 | - The cyanide leach plant at Puerto Blanco is scheduled to begin pilot production of gold, silver, and antimony from the Los Juarez project in Q3 2020[69] Bear River Zeolite (BRZ) Segment Performance The Bear River Zeolite (BRZ) segment experienced a 27% decrease in sales volume in Q1 2020, but net income remained relatively stable at $135,139 due to an increased average sales price per ton Zeolite Performance (Q1 2020 vs Q1 2019) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Tons Sold | 2,809 Tons | 3,841 Tons | | Average Sales Price/Ton | $199.13/Ton | $189.02/Ton | | Gross Zeolite Revenue | $559,360 | $726,015 | | Net Income - Zeolite | $135,139 | $159,450 | Item 3: Quantitative and Qualitative Disclosure about Market Risk No quantitative or qualitative disclosures regarding market risk were provided for the reporting period - No disclosure about market risk was reported[80] Item 4: Controls and Procedures Management concluded that disclosure controls and procedures were ineffective as of March 31, 2020, due to material weaknesses in internal control design, monitoring, and segregation of duties, with remediation plans underway - As of March 31, 2020, the company's disclosure controls and procedures were determined to be ineffective due to material weaknesses[80] - Identified material weaknesses include inadequate design of internal control over financial statement preparation, insufficient monitoring of controls over significant accounts, and an absence of proper segregation of duties with ineffective management oversight[82] PART II – OTHER INFORMATION Item 1: Legal Proceedings No legal proceedings were reported during the period - There are no legal proceedings to report[83] Item 2: Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities were reported - There were no unregistered sales of equity securities[83] Item 3: Defaults upon Senior Securities The company reported no defaults upon senior securities as it has no outstanding senior securities - The registrant has no outstanding senior securities[83] Item 4: Mine Safety Disclosures Mine safety disclosures, including violations and regulatory matters, are provided in Exhibit 95 of the Annual Report - Mine safety disclosures are included in Exhibit 95 to the Annual Report[84] Item 6: Exhibits and Reports on Form 8-K No Reports on Form 8-K were filed during the quarter - No Reports on Form 8-K were filed during the period[85]