Business Context and Reporting Period
Company: Calcasieu Real Estate & Oil Co., Inc. (Note: Input metadata referenced "CKX Lands, Inc." but the filing text identifies the registrant as Calcasieu Real Estate & Oil Co., Inc.)
Filing Type: Form 10-Q
Period Ended: March 31, 2001
Operations: The company derives revenue primarily from oil and gas properties, agricultural properties, and timber properties. As of March 31, 2001, 1,951,446 shares of Common Stock were issued and outstanding.
Key Financial Metrics
| Metric | Q1 2001 | Q1 2000 |
|---|---|---|
| Total Revenues | $473,032 | $585,995 |
| Net Income | $266,821 | $323,473 |
| Earnings Per Share | $0.14 | $0.16 |
| Operating Cash Flow | $315,205 | $641,301 |
| Cash and Equivalents (Ending) | $947,757 | $915,267 |
| Total Assets | $6,170,894 | $5,370,856 |
| Total Current Liabilities | $200,119 | $215,297 |
| Long-Term Debt | Not reported | Not reported |
Note: The filing does not explicitly state a gross margin or net margin percentage; calculations are derived from the provided totals.
Material Changes vs. Prior Period
- Revenue Decline: Total revenues decreased 19.3% ($112,963) compared to Q1 2000. This was driven by a decrease in oil and gas production from the North English Bayou Field and a near-total absence of timber income ($142 vs. $49,810). Higher oil and gas prices partially offset the production decline.
- Expense Reduction: Total expenses decreased 10.1% to $104,728, primarily due to lower forestry expenses and reduced oil and gas production costs.
- Administrative Costs: General and administrative expenses increased 13.4% to $76,549, attributed to higher insurance, legal fees, and franchise taxes.
- Profitability: Net income decreased 17.5% to $266,821.
- Investment Portfolio: Securities available for sale increased significantly from $76,267 in 2000 to $873,901 in 2001.
Outlook, Risks, and Management Commentary
Management Outlook: Management believes current revenues are sufficient to meet existing and anticipated future needs. Long-term trends depend on the ability to find new production to replace mineral depletion and to increase income from timber and agriculture.
Risks and Contingencies:
- Timber Volatility: The lack of timber income in Q1 2001 was caused by weather conditions and adequate inventories at area timber mills, highlighting exposure to environmental and market supply factors.
- Resource Depletion: Future growth is contingent on replacing depleting mineral reserves.
Unusual Items: The filing notes a significant increase in securities available for sale, though the specific acquisition details are not elaborated in the text provided.
Investor Verification Checklist
- Verify the specific reasons for the decline in oil and gas production at the North English Bayou Field.
- Confirm the status of timber inventories at area mills and weather forecasts for the upcoming quarter to assess potential timber revenue recovery.
- Review the composition and valuation of the "Securities Available for Sale" which grew from $76k to $874k.
- Assess the sustainability of the dividend policy given the 17.5% drop in net income (Dividends declared: $97,981).
- Investigate the specific drivers of the 13.4% increase in general and administrative expenses.