Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended September 30, 1999, for Calcasieu Real Estate & Oil Co., Inc. (also referenced as CKX Lands, Inc. in metadata). The company operates in the oil and gas, agriculture, and timber sectors. As of the reporting date, 1,998,752 shares of common stock were issued and outstanding.
Key Financial Metrics (Nine Months Ended Sept 30, 1999)
- Total Revenue: $1,845,006
- Net Income: $1,084,830
- Net Income Per Share: $0.55
- Operating Cash Flow: $1,241,918
- Cash and Cash Equivalents: $505,549 (up from $145,659 in 1998)
- Total Assets: $5,346,128
- Total Liabilities: $765,383 (Current: $454,039; Long-term Debt: $311,344)
- Shareholders' Equity: $4,580,745
Material Changes vs. Prior Period
Financial performance improved significantly compared to the nine months ended September 30, 1998:
- Oil and Gas Income: Increased 204.3% to $1,433,059, driven by new production from the North English Bayou Field (specifically the Prairie Canal No. 3 well) and higher commodity prices.
- Timber Income: Surged 540.8% due to thinning of older growth.
- Agriculture Income: Rose 37.5% to $139,360.
- Net Income: Jumped 290.4% to $1,084,830, while total expenses increased only 25.6%.
- Liquidity: Cash balances increased by approximately $360,000, supported by strong operating cash flows.
Outlook, Risks, and Management Commentary
Management believes current revenues are sufficient to meet existing and anticipated future operational needs. Long-term trends depend on replacing depleting mineral production and increasing income from timber and agriculture.
Risks and Contingencies: The company is defending a legal action to terminate its mineral interest on a small piece of property. Management does not expect this to have a material effect on income. The primary expense increases were attributed to legal fees and general administrative costs for Walker Louisiana Properties.
Investor Verification Checklist
- Verify the sustainability of the 204.3% increase in oil and gas income following the commissioning of the Prairie Canal No. 3 well.
- Confirm the status and potential financial impact of the ongoing legal action regarding mineral interest termination.
- Review the composition of the $311,344 long-term debt and upcoming maturity schedules.
- Assess the volatility of timber income, which saw a 540.8% increase due to one-time thinning activities.