Applied Minerals Inc (AMNL)

[Jagman]

10Q out, doesn't look so good, IMO.

RESULTS OF OPERATIONS

Revenues for the six month period ending June 30, 2005, were $158,478, and $387,7254 for the same period in 2004, or approximately a 59%% decrease. For the three month period ending June 30, 2005, revenues were $15,105, compared to $229,096 for the same period in 2004, or approximately a 93% decrease. The company was not able to maintain contracting work during the comparable periods of 2005, compared to 2004. Thus reflecting an decrease in revenues. For the six month period ended June 30, 2005, the company had timber no revenues compared to $10,758 for the same period in 2004.

Gross profit (loss) for the six months ended June 30, 2005, was ($329,781), compared to $75,723, for the same period in 2004. This was attributed to the greater revenue in 2004 compared to 2005, and direct expenses at the Dragon Mine that were not charged to Exploration and development costs. For the three month period ended June 30, 2005, our gross profit was ($159,050)compared to $42,168 for the same period in 2004. Again greater revenues in 2004 brought gross profits while smaller revenues in the same period in 2005 were not adequate enough to offset costs.

As of the six month period ended June 30, 2005, our total operating expenses were $1,551,815 compared to $498,610 for the same period in 2004. For the three month period ended June 30, 2005, the total operating expenses were $997,880, compared to $174,856 for the same period in 2004, a increase of 211% and 470% respectively. The increase in this category resulted mainly from increases in professional fees during 2005, associated with work at the Dragon mine and fees associated with debt settlements.

Exploration and Development Expenses for the six month period ending June 30, 2005 were $296,503 compared to $55,628 for the same period in 2004. For the three month period ending June 30, 2005 exploration and development expenses were $133,924 compared to $53,540 for the same period in 2004. During 2005 the company began underground development of the Dragon Mine, which was more costly than the work completed in the comparable periods in 2004.

Our net profit (loss) for the six month period ended June 30, 2005, was ($1,887,131) compared to ($444,895) for the same period in 2004, a increase if 324%. For the three month period ended June 30, 2005, the figure was ($1,129,448) compared ($145,152), a increase of 678%. Decreased revenues and increased General and Administrative costs in 2005 helped contribute to this difference.


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