Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2023

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission file number 1-9030

ALTEX INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Delaware		84-0989164
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

700 Colorado Blvd #273 Denver CO 80206

(Address of principal executive offices) (Zip Code)

(303) 265-9312

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 [ ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes [ X ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a small reporting company, or an emerging growth company.

Large accelerated filer [ ]		Accelerated filer [ ]

Non-accelerated filer [ ]		Smaller reporting company ☒

		Emerging growth company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No [ X ]

Number of shares outstanding of issuer's Common Stock as of February 2, 2024: 11,348,021

Item 1. Financial Statements

ALTEX INDUSTRIES, INC.
Condensed Consolidated Balance Sheets
(Unaudited)
	December 31	September 30
	2023	2023
Assets
Current assets
Cash and cash equivalents	`$2,219,000`	`$2,232,000`
Accounts receivable	`2,000`	`4,000`
Other	`15,000`	`22,000`
Total current assets	`2,236,000`	`2,258,000`

Property and equipment, at cost
Proved oil and gas properties (successful efforts method)	`326,000`	`326,000`
Less accumulated depreciation, depletion, and amortization	`(298,000)`	`(297,000)`
Net property and equipment	`28,000`	`29,000`

Right-of-Use Asset	`40,000`	`47,000`

Total assets	`2,304,000`	`$2,334,000`

Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	`1,000`	`$4,000`
Operating lease liability	`27,000`	`27,000`
Accrued expenses, related party	`1,140,000`	`1,140,000`
Other accrued expenses	`7,000`	`11,000`
Total current liabilities	`1,175,000`	`1,182,000`

Long-term operating lease liability	`13,000`	`20,000`

Total Liabilities	`1,188,000`	`1,202,000`

Commitments and Contingencies	`-`	`-`

Stockholders’ equity
Preferred stock, $0.01 par value. Authorized 5,000,000 shares, none issued	`-`	`-`
Common stock, $0.01 par value. Authorized 50,000,000 shares; issued and outstanding, 11,348,021	`114,000`	`114,000`
Additional paid-in capital	`13,715,000`	`13,715,000`
Accumulated deficit	`(12,713,000)`	`(12,697,000)`
Total stockholders' equity	`1,116,000`	`1,132,000`

Total liabilities and stockholders' equity	`$2,304,000`	`$2,334,000`

See notes to unaudited condensed consolidated financial statements

ALTEX INDUSTRIES, INC.
Condensed Consolidated Statements of Operations
(Unaudited)

	Three Months Ended
	December 31
	2023	2022
Revenue
Oil and gas sales	`$6,000`	`$13,000`
Total revenue	`6,000`	`13,000`

Operating expense
Production taxes	`1,000`	`1,000`
General and administrative	`50,000`	`113,000`
Depreciation, depletion, and amortization	`1,000`	`2,000`
Total operating expense	`52,000`	`116,000`

Other income
Interest income	`30,000`	`19,000`
Other income	`-`	`8,000`
Total other income	`30,000`	`27,000`

Net loss	`$(16,000)`	`$(76,000)`

Basic and diluted loss per share	`$(0.00)`	`$(0.01)`

Basic and diluted weighted average shares outstanding	`11,348,021`	`11,517,426`

See notes to unaudited condensed consolidated financial statements

ALTEX INDUSTRIES, INC.
Condensed Consolidated Statements of Stockholders' Equity
(Unaudited)

For the three months ended December 31, 2023	Common Stock		Additional paid-in	Accumulated	Total stockholders'
	Shares	Amount	Capital	deficit	equity
Balance at September 30, 2023	`11,348,021`	`$114,000`	`$13,715,000`	`$(12,697,000)`	`$1,132,000`
Net loss				`(16,000)`	`(16,000)`
Balance at December 31, 2023	`11,348,021`	`$114,000`	`$13,715,000`	`$(12,713,000)`	`$1,116,000`

See notes to unaudited condensed consolidated financial statements

ALTEX INDUSTRIES, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
	Three months ended
	December 31
	2023	2022
Cash flows used in operating activities
Net loss	`$(16,000)`	`$(76,000)`
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation, depletion, and amortization	`1,000`	`2,000`
Changes in assets and liabilities
Decrease (increase) in accounts receivable	`2,000`	`(4,000)`
Decrease in other current assets	`7,000`	`8,000`
Increase (decrease) in accounts payable	`(3,000)`	`3,000`
Increase (decrease) in other accrued expenses	`(4,000)`	`59,000`
Operating lease	`-`	`(1,000)`
Net cash used in operating activities	`(13,000)`	`(9,000)`

Cash flows from investing activities	`-`	`-`

Cash flows from financing activities
Acquisition of treasury stock	`-`	`(45,000)`
Net cash used in financing activities	`-`	`(45,000)`

Net decrease in cash and cash equivalents	`(13,000)`	`(54,000)`
Cash and cash equivalents at beginning of period	`2,232,000`	`2,358,000`
Cash and cash equivalents at end of period	`$2,219,000`	`$2,304,000`

Noncash Investing and Financing Activities
Retirement of treasury stock	`-`	`45,000`

See notes to unaudited condensed consolidated financial statements

ALTEX INDUSTRIES, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1 - Basis of Presentation. The accompanying unaudited, consolidated, condensed financial statements have been prepared in accordance with U.S. GAAP for interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. In the opinion of management, the accompanying unaudited, consolidated, condensed financial statements contain all adjustments necessary to present fairly the financial position of the Company as of December 31, 2023, and the cash flows and results of operations for the three months then ended. Such adjustments consisted only of normal recurring items. The results of operations for the three months ended December 31 are not necessarily indicative of the results for the full year. As of December 31, 2023, there were no potentially dilutive shares for the Company. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The accounting policies followed by the Company are set forth in Note 1 to the Company's consolidated financial statements contained in the Company's 2023 Annual Report on Form 10-K, and it is suggested that these condensed, consolidated financial statements be read in conjunction therewith.

“SAFE HARBOR” STATEMENT UNDER THE

UNITED STATES PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Statements that are not historical facts contained in this Form 10-Q are forward-looking statements that involve risks and uncertainties that could cause actual results to differ from projected results. Factors that could cause actual results to differ materially include, among others: general economic conditions; movements in interest rates; the market price of oil and natural gas; the risks associated with exploration and production of oil and gas; the Company's ability, or the ability of its operating subsidiary, Altex Oil Corporation ("AOC"), to find, acquire, market, develop, and produce new properties; operating hazards attendant to the oil and natural gas business; uncertainties in the estimation of proved reserves and in the projection of future rates of production and timing of development expenditures; the strength and financial resources of the Company's competitors; the Company's ability and AOC's ability to find and retain skilled personnel; climatic conditions; availability and cost of material and equipment; delays in anticipated start-up dates; environmental risks; the results of financing efforts; and other uncertainties detailed elsewhere herein and in the Company’s filings with the Securities and Exchange Commission.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation.

Financial Condition

The Company used $13,000 cash in operating activities in the three months ended December 31, 2023, and used $9,000 cash in operating activities in the three months ended December 31, 2022. On October 26, 2022, the Company acquired 493,975 shares of its common stock for $44,556.55, and on November 9, 2022, the Company retired the 493,975 shares. At December 31, 2023 and 2022, $1,140,000 of accrued expenses is accrued but unpaid salary and bonus, and related accrued payroll tax liability, due to the Company’s president that the Company’s president has elected to defer. The Company’s president may cause the Company to pay the unpaid salary and bonus and payroll tax liability at any time.

The Company is likely to experience negative cash flow from operations unless the Company invests in interests in producing oil and gas wells or in another venture that produces sufficient cash flow from operations. With the exception of capital expenditures related to production acquisitions or drilling or recompletion activities or an investment in another venture that produces cash flow from operations, none of which are currently planned, the cash flows that could result from such acquisitions, activities, or investments, and the possibility of a material change in

the current level of interest rates or of oil and gas prices, the Company knows of no trends or demands, commitments, events or uncertainties that will result in or that are reasonably likely to result in the Company's liquidity increasing or decreasing in any material way. Except for cash generated by the operation of the Company's producing oil and gas properties, asset sales, and interest income, the Company has no internal or external sources of liquidity other than its working capital. At February 2, 2024, the Company had no material commitments for capital expenditures.

Results of Operations

General and administrative expense decreased from $113,000 in the three months ended December 31, 2022, to $50,000 in the three months ended December 31, 2023, principally because, during the quarter ended December 31, 2022, the Company recognized bonus expense and related payroll tax liability of $68,000 pursuant to the president’s employment agreement. Interest income increased from $19,000 in the three months ended December 31, 2022, to $30,000 in the three months ended December 31, 2023, because of higher realized interest rates.

At the current levels of net oil and gas production, cash balances, interest rates, and oil and gas prices, the Company’s revenue is unlikely to exceed its expenses. Unless the Company invests a substantial portion of its cash balances in interests in producing oil and gas wells or in one or more other ventures that produce revenue and net income, the Company is likely to experience net losses. With the exception of unanticipated asset retirement obligations, unanticipated environmental expense, and possible changes in interest rates and oil and gas prices, the Company is not aware of any other trends, events, or uncertainties that have had or that are reasonably expected to have a material impact on net sales or revenues or income from continuing operations.

Climate Change

The company does not believe that climate change or regulations adopted to mitigate the consequences of climate change will have a material impact on the Company’s financial condition or results of operations.

Item 4. Controls and Procedures.

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Principal Executive Officer and Principal Financial Officer as appropriate, to allow timely decisions regarding required disclosure. Management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures which, by their nature, can provide only reasonable assurance regarding management’s control objectives.

As of the end of the period covered by the report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon the foregoing, the Company’s Principal Executive Officer and Principal Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its consolidated subsidiary) required to be included in the Company’s Exchange Act reports. There have been no significant changes in the Company’s internal controls or in other factors that could significantly affect internal controls subsequent to the date the Company carried out its evaluation.

PART II - OTHER INFORMATION

Item 6. Exhibits

31.	Rule 13a-14(a)/15d-14(a) Certifications
32.*	Section 1350 Certifications
101.xml	XBRL Instance Document
101.xsd	XBRL Taxonomy Extension Schema Document
101.cal	XBRL Taxonomy Extension Calculation Linkbase Document
101.def	XBRL Taxonomy Extension Definition Linkbase Document
101.lab	XBRL Taxonomy Extension Label Linkbase Document
101.pre	XBRL Taxonomy Extension Presentation Linkbase Document
___________________________
* Furnished. Not Filed. Not incorporated by reference. Not subject to liability.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ALTEX INDUSTRIES, INC.

Date: February 2, 2024

By: /s/ STEVEN H. CARDIN

Steven H. Cardin

Chief Executive Officer and

Principal Financial Officer

EXHIBIT 31

Rule 13a-14(a)/15d-14(a) Certifications

I, Steven H. Cardin, certify that:

1. I have reviewed this Form 10-Q of Altex Industries, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ STEVEN H. CARDIN

February 2, 2024

Steven H. Cardin

Date

Principal Executive Officer and

Principal Financial Officer

EXHIBIT 32

Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Altex Industries, Inc. (the "Company") on Form 10-Q for the period ending December 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Steven H. Cardin, Chief Executive Officer and Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: February 2, 2024

By: /s/ STEVEN H. CARDIN

Steven H. Cardin

Chief Executive Officer and

Principal Financial Officer

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Dec. 31, 2023	Feb. 02, 2024
Details
Registrant CIK	0000775057
Fiscal Year End	--09-30
Registrant Name	ALTEX INDUSTRIES INC
SEC Form	10-Q
Period End date	Dec. 31, 2023
Tax Identification Number (TIN)	84-0989164
Number of common stock shares outstanding		11,348,021
Filer Category	Non-accelerated Filer
Current with reporting	Yes
Interactive Data Current	Yes
Shell Company	false
Small Business	true
Emerging Growth Company	false
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	1-9030
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	700 Colorado Blvd #273
Entity Address, City or Town	Denver
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80206
City Area Code	303
Local Phone Number	265-9312
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1

Condensed Consolidated Balance Sheets - USD ($)	Dec. 31, 2023	Sep. 30, 2023
Current assets
Cash and cash equivalents	$ 2,219,000	$ 2,232,000
Accounts receivable	2,000	4,000
Other	15,000	22,000
Total current assets	2,236,000	2,258,000
Property and equipment, at cost
Proved oil and gas properties (successful efforts method)	326,000	326,000
Less accumulated depreciation, depletion, and amortization	(298,000)	(297,000)
Net property and equipment	28,000	29,000
Right-of-Use Asset	40,000	47,000
Total assets	2,304,000	2,334,000
Current liabilities:
Accounts payable	1,000	4,000
Operating lease liability	27,000	27,000
Accrued expenses, related party	1,140,000	1,140,000
Other accrued expenses	7,000	11,000
Total current liabilities	1,175,000	1,182,000
Long-term operating lease liability	13,000	20,000
Total Liabilities	1,188,000	1,202,000
Commitments and Contingencies	0	0
Stockholders' equity:
Preferred stock	0	0
Common stock	114,000	114,000
Additional paid-in capital	13,715,000	13,715,000
Accumulated deficit	(12,713,000)	(12,697,000)
Total stockholders' equity	1,116,000	1,132,000
Total liabilities and stockholders' equity	$ 2,304,000	$ 2,334,000

Condensed Consolidated Balance Sheets - Parenthetical - $ / shares	Dec. 31, 2023	Sep. 30, 2023
Condensed Consolidated Balance Sheets
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Preferred Stock, Shares Authorized	5,000,000	5,000,000
Preferred Stock, Shares Issued	0	0
Common Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Common Stock, Shares Authorized	50,000,000	50,000,000
Common Stock, Shares, Issued	11,348,021	11,348,021
Common Stock, Shares, Outstanding	11,348,021	11,348,021

Condensed Consolidated Statements of Operations - USD ($)	3 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Revenue
Oil and gas sales	$ 6,000	$ 13,000
Total revenue	6,000	13,000
Operating expense
Production taxes	1,000	1,000
General and administrative	50,000	113,000
Depreciation, depletion, and amortization	1,000	2,000
Total operating expense	52,000	116,000
Other Nonoperating Income (Expense)
Interest income	30,000	19,000
Other income	0	8,000
Total other income	30,000	27,000
Net loss	$ (16,000)	$ (76,000)
Basic and diluted loss per share	$ (0.00)	$ (0.01)
Basic and diluted weighted average shares outstanding	11,348,021	11,517,426

Condensed Consolidated Statements of Stockholders' Equity - 3 months ended Dec. 31, 2023 - USD ($)	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock, Common
Equity, Attributable to Parent, Beginning Balance at Sep. 30, 2023	$ 1,132,000	$ 114,000	$ 13,715,000	$ (12,697,000)	$ 1,132,000
Shares, Outstanding, Beginning Balance at Sep. 30, 2023		11,348,021
Net loss	(16,000)			(16,000)	(16,000)
Equity, Attributable to Parent, Ending Balance at Dec. 31, 2023	$ 1,116,000	$ 114,000	$ 13,715,000	$ (12,713,000)	$ 1,116,000
Shares, Outstanding, Ending Balance at Dec. 31, 2023		11,348,021

Condensed Consolidated Statements of Cash Flows - USD ($)	3 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Cash flows used in operating activities
Net loss	$ (16,000)	$ (76,000)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation, depletion, and amortization	1,000	2,000
Changes in assets and liabilities
Decrease (increase) in accounts receivable	2,000	(4,000)
Decrease in other current assets	7,000	8,000
Increase (decrease) in accounts payable	(3,000)	3,000
Increase (decrease) in other accrued expenses	(4,000)	59,000
Operating lease	0	(1,000)
Net cash used in operating activities	(13,000)	(9,000)
Cash flows from investing activities	0	0
Cash flows from financing activities
Acquisition of treasury stock	0	(45,000)
Net cash used in financing activities	0	(45,000)
Net decrease in cash and cash equivalents	(13,000)	(54,000)
Cash and cash equivalents at beginning of period	2,232,000	2,358,000
Cash and cash equivalents at end of period	2,219,000	2,304,000
Noncash Investing and Financing Activities
Retirement of treasury stock	$ 0	$ 45,000

Note 1 Basis of Presentation	3 Months Ended
Note 1 Basis of Presentation	Dec. 31, 2023
Notes
Note 1 Basis of Presentation	Note 1 - Basis of Presentation. The accompanying unaudited, consolidated, condensed financial statements have been prepared in accordance with U.S. GAAP for interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. In the opinion of management, the accompanying unaudited, consolidated, condensed financial statements contain all adjustments necessary to present fairly the financial position of the Company as of December 31, 2023, and the cash flows and results of operations for the three months then ended. Such adjustments consisted only of normal recurring items. The results of operations for the three months ended December 31 are not necessarily indicative of the results for the full year. As of December 31, 2023, there were no potentially dilutive shares for the Company. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The accounting policies followed by the Company are set forth in Note 1 to the Company's consolidated financial statements contained in the Company's 2023 Annual Report on Form 10-K, and it is suggested that these condensed, consolidated financial statements be read in conjunction therewith.