What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-08-09 compared with 2024-05-15 · 158 added, 56 removed, 239 unchanged (47% of the section changed)

35 unchanged sentences

The positions and associated outcomes of Mexican and other taxing authorities;

The possible dilution of the Company’s common stock from additional financing activities;

Cybersecurity and business disruptions;

Potential conflicts of interest with the Company’s management;

Not realizing the value of its USAMSA assets in Mexico upon sale or disposal;

Not realizing the value of its USAMSA assets in Mexico or personal residence in Idaho upon sale or disposal;

The Company’s common stock.

24 unchanged sentences

The Company formed Bear River Zeolite Company (“BRZ”) in 2000 for the purpose of mining and producing zeolite in Idaho.

Our principal business is the production and sale of antimony, precious metals, primarily gold and silver, and zeolite products.

Our principal business is the production and sale of antimony, precious metals, and zeolite products.

In May 2012, our shares of common stock started trading on the NYSE MKT (now NYSE AMERICAN) under the symbol UAMY.

On March 11, 2024, the Company shut down the operations of USAMSA and announced its plans to sell its USAMSA subsidiary, operations, or assets.

On March 11, 2024, the Company shut down the operations of USAMSA and announced its plans to sell its USAMSA subsidiary.

See Note 1 and Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report for further information.

The accounting requirements for reporting USAMSA as a discontinued operation were met in the first quarter of 2024.

Accordingly, the consolidated financial statements and notes to the consolidated financial statements reflect the results of USAMSA as a discontinued operation and are excluded from continuing operations and segment results for all periods presented.

Accordingly, the condensed consolidated financial statements, Notes to Condensed Consolidated Financial Statements , and Management’s Discussion & Analysis and Plan of Operation reflect the results of USAMSA as a discontinued operation and are excluded from continuing operations and segment results for all periods presented.

In May 2024, the Company made the decision to sell the personal residence it owns in Idaho that was previously used for management located near its BRZ operation (“BRZ Home”).

The Company also signed an agreement with a realtor in May 2024 to assist with the sale of its BRZ Home.

An active search for a buyer began after signing the agreement with the realtor and the Company expects the home to be sold sometime over the next year.

See Note 1 and Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report for further information.

Although we extract minerals from the Bear River Zeolite property in Idaho that we later process and sell, we have not yet prepared a technical report summary for the Bear River Zeolite property making a determination on the property’s mineral resources or mineral reserves.

However, the Company is in the process of beginning this initiative.

However, the Company has completed test hole drilling and is in the process of preparing a technical reserve report for the Bear River Zeolite property.

We strive to achieve excellence in mine safety and health performance and work with government agencies to ensure compliance with environmental regulations and health and safety standards.

The Company is organized and managed by the following four segments, which represent our operating units:

United States antimony segment, Mexico antimony segment, zeolite segment, and precious metals segment.

See Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report for the Mexico discontinued operations that are excluded from business segments.

See Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report for the Mexico discontinued operations that are excluded from continuing operations and segment results for all periods presented.

United States Antimony Segment

7 unchanged sentences

We closed our antimony mine and mill in Montana in December 1983 because antimony ore could be purchased more economically from foreign sources.

Our mine and mill are approximately 1 mile from our current antimony smelter plant in Montana.

Our mine and mill are less than one mile from our current antimony smelter plant in Montana.

We hold one patented claim at the mine.

The environmental permitting process currently precludes mining at our mine in Montana.

As a result of the mine and mill closure, we have relied on sources outside the U.S.

for antimony ore since 1983, and there are risks of interruption in procurement from these sources and volatile changes in world market prices for these materials that are not controllable by us.

We anticipate continuing to receive antimony ore primarily from a supplier in Canada but will continue to explore Mexico and Central America for suppliers of antimony ore, assuming economics are profitable.

We anticipate continuing to receive antimony ore primarily from a supplier in Canada but will also continue to research other domestic and non-domestic sources for antimony ore that are economically profitable.

The acquisition of antimony ore is technically complex and a function of the country’s laws and regulations.

8 unchanged sentences

We have a reputation for quality products delivered on a timely basis.

We have the only operating, permitted antimony smelter in the U.S.

We have the only operating, permitted antimony smelter located in the U.S.

Mexico Antimony Segment

2 unchanged sentences

(1) the Madero smelter in Coahuila, and (2) the Puerto Blanco flotation mill, oxide circuit, and cyanide leach circuit in Guanajuato.

The Company intends to sell its USAMSA subsidiary, operations, or assets over the next year and has initiated an active search for buyers or leasing opportunities of its operations and/or existing assets.

The Company intends to sell its USAMSA subsidiary over the next year and has initiated an active search for buyers of its operations and/or assets.

We will maintain our existing Los Juarez mining claims and concessions in Cadereyta de Montes Queretaro, Mexico, which are included in our ADM subsidiary.

1 unchanged sentence

Zeolite Segment

Our zeolite segment consists of a mine and mill in Preston, Idaho, Bear River Zeolite, Inc.

Our zeolite segment consists of a mine and processing plant in Preston, Idaho, Bear River Zeolite, Inc.

(“BRZ”), which produces zeolite.

16 unchanged sentences

Water Filtration .

Zeolite is used for particulate, heavy metal and ammonium removal in swimming pools, municipal water systems, fisheries, fish farms, and aquariums.

Zeolite is used for particulate, heavy metal and ammonium removal in swimming pools, municipal water systems, industrial water discharge streams, fisheries, fish farms, and aquariums.

Sewage Treatment .

16 unchanged sentences

When precious metals are contained in antimony source, the metallurgical techniques employed for the recovery of antimony are altered to also recover the precious metals.

The principal source of antimony concentrates bearing precious metals came from our Canadian supplier, who also purchases precious metals from the Company.

The principal source of antimony concentrates bearing precious metals came from our Canadian supplier, who also purchases these precious metals back from the Company.

The sales of this product are intermittent throughout the year.

SELECTED FINANCIAL DATA.

2 unchanged sentences

For the three months ended

For the six months ended

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Costs of revenues

Total operating expenses

Income (loss) from continuing operations

Loss from operations

Total other income

Income tax expense

Net income from continuing operations

Balance Sheet Information of Continuing Operations:

Consolidated Balance Sheet Information, Excluding Discontinued Operations:

Income (loss) from continuing operations

Balance Sheet Information:

Consolidated Balance Sheet Information:

June 30, 2024

December 31, 2023

Working capital

4 unchanged sentences

Operational and Financial Performance of Continuing Operations by Segment:

Financial and operational performance of antimony for the three months ended March 31, 2024 and 2023 was as follows:

Financial and operational performance of antimony for the three months ended June 30, 2024 and 2023 was as follows:

For the three months ended

Antimony - Combined USA and Mexico

March 31, 2024

March 31, 2023

Antimony - Continuing Operations

June 30, 2024

June 30, 2023

Pounds of antimony sold

2 unchanged sentences

Average gross profit per pound

Antimony revenue increased $615,746, or 38%, during the three months ended March 31, 2024, compared to the three months ended March 31, 2023, primarily due to the increased pounds of antimony sold mainly from increased demand for antimony oxide and metal.

A portion of the increased demand for antimony metal is related to the processing of customer-owned antimony ore.

The sales price per pound related to the processing of customer-owned antimony ore is lower than the sales price per pound for our other antimony products.

Therefore, the increased revenue from the processing of customer-owned antimony ore for the three months ended March 31, 2024, compared to the three months ended March 31, 2023, was the primary reason for the decrease in our overall average sales price per pound.

Gross profit increased $866,433 for the three months ended March 31, 2024, compared to the three months ended March 31, 2023, primarily due to the increased pounds of antimony sold from increased demand for antimony oxide and metal.

The improved results related to average gross profit per pound in both periods presented relates to discontinuing our Mexico antimony operations, the results of which are not included in the continuing operations information presented but rather included in discontinued operations in Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report.

Financial and operational performance of zeolite for the three months ended March 31, 2024 and 2023 was as follows:

Financial and operational performance of antimony for the six months ended June 30, 2024 and 2023 was as follows:

For the six months ended

Antimony - Continuing Operations

June 30, 2024

June 30, 2023

Pounds of antimony sold

Average sales price per pound

Average cost per pound

Average gross profit per pound

Antimony revenue increased $1,078,819, or 36%, for the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to higher volume from increased demand for antimony oxide and metal.

A portion of this increased demand for antimony metal was related to the processing of customer-owned antimony ore.

The sales price per pound related to the processing of customer-owned antimony ore was lower than the sales price per pound for our other antimony products, which was the primary reason for the decrease in our average sales price per pound during the six months ended June 30, 2024, as compared to the prior year.

Gross profit increased $1,585,030 for the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to improved cost efficiencies with higher volume and the prior year sale of purchased finished antimony trioxide at a lower gross margin.

Also, the improved results related to average gross profit per pound in the six-month periods presented related to discontinuing our Mexico antimony operations, the results of which are not included in the continuing operations information presented but rather in discontinued operations, which is presented in Note 11 of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report.

Financial and operational performance of zeolite for the three months ended June 30, 2024 and 2023 was as follows:

For the three months ended

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

Tons of zeolite sold

Average sales price per ton

Average cost per ton

Average gross profit per ton

Financial and operational performance of zeolite for the six months ended June 30, 2024 and 2023 was as follows:

For the six months ended

June 30, 2024

June 30, 2023

Gross profit (loss)

3 unchanged sentences

Average gross profit (loss) per ton

Zeolite revenue increased $120,912, or 25%, during the three months ended March 31, 2024, compared to the three months ended March 31, 2023, primarily due to:

The increased tons of zeolite sold mainly from increased demand and our ability to meet customer orders in a more timely fashion, and

The increased average sales price per ton mainly from a price increase that was effective towards the end of 2023.

Gross profit decreased by $322,260 in the three months end March 31, 2024, compared to the three months ended March 31, 2023, primarily due to increased maintenance costs and inefficient facility and labor-related costs in repairing older equipment and production downtime issues in the first quarter of 2024 versus 2023.

Zeolite revenue increased $328,207 or 26%, for the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to:

The increased average sales price per ton, which was mainly related to a price increase that was effective towards the end of 2023, and

The increased tons of zeolite sold, which was mainly related to increased demand and our ability to meet customer orders in a more timely fashion.

Gross profit decreased by $397,070 for the six months end June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to increased maintenance expense and inefficient facility and labor-related expenses in repairing older equipment, especially during production downtime, in the first six months of 2024 versus 2023.

Precious Metals

Financial and operational performance of precious metals for the three months ended March 31, 2024 and 2023 was as follows:

Financial and operational performance of precious metals for the three months ended June 30, 2024 and 2023 was as follows:

For the three months ended

Precious metals

June 30, 2024

June 30, 2023

Gross profit (loss)

1 unchanged sentence

Ounces sold - silver

Financial and operational performance of precious metals for the six months ended June 30, 2024 and 2023 was as follows:

For the six months ended

Precious metals

June 30, 2024

June 30, 2023

Gross profit (loss)

Ounces sold - gold

Ounces sold - silver

Earnings before Interest, Tax, Depreciation and Amortization (“EBITDA”)

4 unchanged sentences

EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.

Our EBITDA was $192,899 for the three months ended March 31, 2024, compared to EBITDA of $366,312 for the three months ended March 31, 2023.

EBIDTA of continuing operations by segment for the three months ended March 31, 2024 and 2023 was as follows:

Our EBITDA from continuing operations was $253,122 for the six months ended June 30, 2024, as compared to $431,257 for the six months ended June 30, 2023.

EBIDTA from continuing operations by segment for the three months ended June 30, 2024 and 2023 was as follows:

For the three months ended

Antimony – Combined USA and Mexico

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

Cost of sales

4 unchanged sentences

Income tax expense

Net income (loss) - antimony

Income (loss) - antimony

Interest expense

3 unchanged sentences

For the three months ended

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

Cost of sales

4 unchanged sentences

Income tax expense

Net income (loss) - zeolite

Income (loss) - zeolite

Interest expense

4 unchanged sentences

Precious Metals

June 30, 2024

June 30, 2023

Cost of sales

3 unchanged sentences

Total other income (expense)

Net income (loss) - precious metals

Income (loss) - precious metals

Interest expense

2 unchanged sentences

For the three months ended

June 30, 2024

June 30, 2023

Cost of sales

4 unchanged sentences

Income tax expense

Net income (loss) - consolidated

Income (loss) - consolidated

Interest expense

2 unchanged sentences

EBITDA - consolidated

EBIDTA from continuing operations by segment for the six months ended June 30, 2024 and 2023 was as follows:

For the six months ended

Antimony – Combined USA and Mexico

June 30, 2024

June 30, 2023

Cost of sales

Gross profit (loss)

Total operating expenses

Income (loss) from operations

Total other income (expense)

Income tax expense

Income (loss) - antimony

Interest expense

Income tax expense

Depreciation and amortization

EBITDA - antimony

For the six months ended

June 30, 2024

June 30, 2023

Cost of sales

Gross profit (loss)

Total operating expenses

Income (loss) from operations

Total other income (expense)

Income tax expense

Income (loss) - zeolite

Interest expense

Income tax expense

Depreciation and amortization

EBITDA - zeolite

For the six months ended

Precious Metals

June 30, 2024

June 30, 2023

Cost of sales

Gross profit (loss)

Total operating expenses

Income (loss) from operations

Total other income (expense)

Income (loss) - precious metals

Interest expense

Depreciation and amortization

EBITDA - precious metals

For the six months ended

June 30, 2024

June 30, 2023

Cost of sales

Gross profit (loss)

Total operating expenses

Income (loss) from operations

Total other income (expense)

Income tax expense

Income (loss) - consolidated

Interest expense

Income tax expense

Depreciation and amortization

EBITDA - consolidated

Capital Resources and Liquidity:

Working Capital of Continuing Operations

June 30, 2024

December 31, 2023

Current assets

1 unchanged sentence

Working capital

For the three months ended

For the six months ended

CASH FLOWS OF CONTINUING OPERATIONS

Net cash provided by operating activities

June 30, 2024

June 30, 2023

Net cash provided (used) by operating activities

$ (1,168,428 )

3 unchanged sentences

$ (3,198,062 )

Cash flow provided by operating activities improved by $1,419,199 for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to good working capital management with better collections on receivables, better inventory management, and maintaining a lower amount due on royalties.

Cash flow used by investing activities improved by $499,171 for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to less fixed asset purchases.

Cash flow used by financing activities improved by $789,479 for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to the payment of a dividend of $787,730 on January 25, 2023 to the holders of 1,692,672 shares of Series D Preferred stock.

Our mission is to service our employees, customers, and vendors well and grow our business profitably both organically and through strategic acquisitions to increase shareholder value.

Cash flow provided by operating activities improved by $1,604,091 for the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to good working capital management, which includes better inventory management, increased payments of compensation in stock, and maintaining a lower amount due on royalties.

Cash flow used by investing activities improved by $1,095,495 for the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to less fixed asset purchases.

Cash flow used by financing activities improved by $795,029 for the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to the payment of a dividend of $787,730 on January 25, 2023 to the holders of 1,692,672 shares of Series D Preferred stock.

Our mission is to service our employees, customers, and vendors well and grow our business profitably both organically and through strategic acquisitions and partnerships to increase shareholder value.

The Company is focused on generating positive cash flow to fund its mission.

1 unchanged sentence

An example of the results of our review relates to USAMSA.

Our USAMSA entity has generated cumulative losses since inception.

Therefore, we shut down the operations of our USAMSA entity on March 11, 2024 and intend to sell this entity, operations, or assets over the next year.

Our USAMSA subsidiary has generated cumulative losses since inception.

Therefore, we shut down the operations of USAMSA on March 11, 2024 and intend to sell this subsidiary over the next year.

We have initiated an active search for buyers of USAMSA’s operations and/or existing assets.

4 unchanged sentences

The nature of these investments and transactions, however, makes it difficult to predict the amount and timing of such cash requirements.

As of March 31, 2024, the Company had cash and cash equivalents of $11,941,298.

As of June 30, 2024, the Company had cash and cash equivalents of $12,391,431.

We intend to fund our cash requirements with our cash and cash equivalents, cash generated from our operations, and capital raised from various investment vehicles and believe cash from these sources are sufficient to cover our requirements for the next 12 months.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis