<PAGE>   1
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                  -------------

                                   FORM 10-QSB


                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000

                                       OR

                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: 0-12185

                                  -------------

                            DAUGHERTY RESOURCES, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

         PROVINCE OF BRITISH COLUMBIA                        NOT APPLICABLE
(State or other jurisdiction of incorporation or            (I.R.S. EMPLOYER
                 organization)                             IDENTIFICATION NO.)

       120 PROSPEROUS PLACE, SUITE 201
              LEXINGTON, KENTUCKY                               40509-1844
   (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                     (ZIP CODE)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (859) 263-3948

                                  -------------

         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    .
                                               ---     ---
         THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE REGISTRANT'S CLASSES OF
COMMON STOCK, AS OF JUNE 30, 2000, WAS 2,913,030.

         Transitional Small Business Disclosure Format (check one): Yes    No X.
                                                                       ---   ---

================================================================================




<PAGE>   2



                                     PART I
                              FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

         The information required by this Item 1 appears on pages i through iv
of this Report, and is incorporated herein by reference.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

         The following is a discussion of the Company's financial condition and
results of operations. This discussion should be read in conjunction with the
Financial Statements of the Company described in Item 1 of this Report.
Statements contained in this "Management's Discussion and Analysis of Financial
Condition and Results of Operations," which are not historical facts may be
forward looking statements. Reliance upon such information involves risks and
uncertainties, including those created by general market conditions, competition
and the possibility that events may occur which could limit the ability of the
Company to maintain or improve its operating results or execute its primary
growth strategy. Although management believes that the assumptions underlying
the forward-looking statements are reasonable, any of the assumptions could be
inaccurate, and there can be no assurances that the forward-looking statements
included herein will prove to be accurate. The inclusion of such information
should not be regarded as a representation by management or any other person
that the objectives and plans of the Company will be achieved. Moreover, such
forward-looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those projected. Readers
are cautioned not to place undue reliance on these forward-looking statements
that speak only as of the date hereof.

         Daugherty Resources, Inc., formerly Alaska Apollo Resources Inc., (the
"Company" or the "Registrant") is a diversified natural resources company with
assets in oil and gas, and gold prospects. Originally formed in 1979 to develop
gold properties, the Company in the fourth quarter of 1993, acquired its wholly
owned subsidiary, Daugherty Petroleum, Inc.

         Since acquiring Daugherty Petroleum, Inc., the Company has increased
its reserves through the acquisition of oil and gas properties in the
Appalachian and Illinois Basins, and the drilling of wells in the Appalachian
Basin through joint venture and turnkey drilling programs, where Daugherty
Petroleum, Inc. is the primary decision maker. The Company continues to
aggressively seek acquisitions and drilling programs.

LIQUIDITY

         The Company continues its tradition of realizing revenues from its oil
and gas operations. For the six months ending June 30, 2000, the Company drilled
seventeen wells (4.30 net wells) (fourteen natural gas wells, three wells
capable of producing both oil and natural gas) completed eight natural gas wells
and extended its gathering system by 17,760 feet. By comparison, for the same
period of 1999, the Company drilled four natural gas wells (1.95 net wells).
Drilling operations for the first six months of 2000 were primarily related to a
joint venture on the Company's farmout acreage acquired from Equitable Resources
Energy Corporation, now Equitable Production Company.

         The Company funds its operations through a combination of cash flow
from operations, capital raised through drilling partnerships and the sale of
stock. Operational cash flow is generated by sales of natural gas and oil from
interests the Company owns in wells, well operations of partnership wells, and
well drilling and completions for Company sponsored partnerships.

         The Company continues to review additional opportunities for
acquisitions of oil and gas properties. Previous acquisitions have been
completed using Company stock to pay for the acquisitions. Generally, interests
in wells purchased include a majority interest in the wells and the right to
operate wells.

         The Company acquired wells in two acquisitions in the last quarter of
1999. One transaction was with Environmental Energy, Inc., and its affiliated
limited partnerships, which closed on October 21, 1999 and allowed the



                                        2
<PAGE>   3

Company to acquire interests in 41 oil and gas wells located in Kentucky,
Louisiana and Tennessee. On October 13, 1999 the Company agreed to purchase from
Ken-Tex Oil & Gas, Inc. 50% interest in 24 natural gas wells located in Knox
County, Kentucky together with gathering systems, easements and operating rights
for $425,000 payable in 191,519 shares of restricted common stock valued at
$2.2191 per share. Because of the ownership structure of the well interests the
transaction was originally designed to be a three part closing. As of June 30,
2000 four closing have been conducted and a total of 165,588 shares of stock had
been issued in connection with the acquisition. Additional interests may be
acquired in subsequent closings for which the company is prepared to issue up to
an additional 25,931 shares of stock.

         On June 22, 2000, the Company announced that it had discovered a new
oil and gas field on a 5,000-acre tract located in Bell County, Kentucky. The
Company acquired the drilling rights to the tract in April of 1998 from
Equitable Production Company, formerly Equitable Resources Energy Company.

         During the second quarter, the Company completed the acquisition of an
oil and gas lease from J. M. Huber Corporation covering 12,300 acres located in
Claiborne County, Tennessee. The lease is adjacent to the 5,000-acre tract
located in Bell County, Kentucky.

         The Company has primarily concentrated in drilling wells on prospects
it generates in the Appalachian Basin. Historically, a major portion of the
Company's revenues have been from its activities as "turnkey driller" and
operator of various drilling programs in the Appalachian Basin. During the first
six months of 2000, approximately 91% of the Company's revenues were derived
from joint venture drilling.

         Through the end of the second quarter, the Company has drilled 17
wells, which represent approximately 57% of its announced goal of 30 wells for
fiscal year 2000. While the Company's working interest in the wells that it
drills varies from well to well, for the three (3) wells drilled quarter ending
June 30, 2000, it increased its average working interest to 33.33%. The Company
expects that it will drill an additional 13 wells during the last two quarters
of 2000 and maintain working interests ranging from 15% to 50% of each well it
drills.

         As of June 30, 2000, Sentra Corporation, the Company's natural gas
utility subsidiary, completed its first full six months of operations with sales
of $36,309. Sentra has installed approximately 75,100 feet of transmission line
and 18,500 feet of distribution line. As of August 11, 2000, Sentra had 81
customers, 15 of which are commercial accounts. In addition, Sentra has
installed 67 risers that are awaiting the setting of meters and the commencement
of service, and has an additional 94 applications from customers requesting
service. Sentra expects high demand for natural gas service in its service areas
because of ease of usage, economy and reliability. Further, demand is expected
to increase because of continued growth and acceptance of natural gas by the
chicken industry that is a major commercial segment in the economy of Sentra's
service areas and as of August 11, 2000, Sentra is running a service line to one
chicken broiler house complex and in negotiations with several other owners of
similar operations to provide natural gas service. By the end of the third
quarter, Sentra expects to be providing natural gas service to at least four
such complexes with a total of 20 broiler houses an increase of 150% over the
eight (8) houses it serviced at the end of the second quarter. Each broiler
house consumes the rough equivalent of 7 average residences

         Working capital for the period ending June 30, 2000 was a negative
$2,885,714 compared to the same period in 1999, when working capital was a
negative $2,342,765.

         During the period ending June 30, 2000 and compared to that same period
in 1999, the changes in the composition of the Company's current assets were:
cash balances increased $36,692 from $296,775 to $333,467; accounts receivable
balances increased $124,970 from $64,798 to $189,768; Other current assets such
as prepaids and notes receivable decreased $525,561 from $530,000 to $4,439. The
majority of the decrease was due to the divestiture of Red River Hardwoods, Inc.
during 1999. Overall, current assets decreased by $363,899 to $527,674.

         Current liabilities for the period ended June 30, 2000 were $3,413,388
compared to $3,234,338 for the period ended June 30, 1999.



                                        3
<PAGE>   4

         While the Company believes its cash flow resulting in operating
revenues will contribute significantly to its short term financial commitments
and operating costs, it has continued to refine its long term strategy in 2000
to meet the Company's financial obligations. This strategy includes:

         o INCREASING JOINT VENTURE DRILLING. Higher oil and gas prices have
           sparked an increased interest in partnership drilling. The Company
           drilled three (3) wells during the second quarter pursuant to the
           terms of a partnership agreement dated April 30, 2000. On August 3,
           2000, the Company signed a partnership agreement and turnkey drilling
           and operating agreement to drill up to 11 wells by March 31, 2001.
           The Company is also in negotiations with other parties interested in
           drilling wells during the remaining of fiscal year 2000. Because of
           the level of interest in drilling the Company believes that it will
           meet its goal of drilling 30 wells during 2000.

         o ACQUISITION OF REVENUE PRODUCING PROPERTIES. The Company continues to
           review existing oil and gas properties for sale in its areas of
           interest. In addition to reviewing new properties, the Company
           intends to finalize the Ken-Tex acquisition in 2000.

         o INSTALLATION OF ADDITIONAL NATURAL GAS GATHERING SYSTEM. The
           Company's plan to expand its natural gas gathering system in 2000 by
           more than 50,000 feet is progressing. On May 5, 2000, 14,000 feet of
           four-inch pipeline was completed and gas flow commenced from the
           three wells located in the Company's Hatfield Gap Field. The Company
           owns wells in its Kay Jay Field that are shut in or experiencing
           production constraints due to pipeline restrictions and a 40,000-foot
           gathering line extension to the Kay Jay Field is planned.
           The Company has secured a portion of the right of way along the
           proposed route for the gathering line extension and is in
           negotiations for the remainder of the right of way. It is anticipated
           that construction on the line will be completed prior to the end of
           2000. This extension will allow the Company to increase its flow of
           gas from wells it owns and operates, plus transport gas from wells it
           drills in the future.

         o GOLD AND SILVER PROPERTIES. It is the Company's objective to realize
           the value of its gold and silver properties by 1) obtaining a joint
           venture partner to provide funds for additional exploration on its
           prospects or 2) divesting of its gold and silver properties. To help
           achieve its goal in March 2000, the Company commissioned an
           engineering review and an appraisal by qualified independent third
           parties of its gold and silver properties, which were completed early
           in the second quarter.

RESULTS OF OPERATIONS

         For the six-month period ending June 30, 2000, the Company's gross
revenues increased $3,397,644 to $3,937,25595 from $539,611 for the same period
in 1999. The majority of the increase was attributable to increased turnkey
drilling operations. The Company experienced net income from continuous
operations of $528,491 in this period compared to a net income of $177,509 in
the same period of 1999.

         The Company's gross revenues were derived from drilling contract
revenues of $3,575,797 (91%), from natural gas and oil operations and production
revenues of $325,149 (8%) and natural gas distribution of $36,309 (1%).

         The increase in gross revenues of $3,397,644 was primarily attributable
to the increased in drilling activity during the period. Contract revenues from
drilling activities increased by $3,248,963 from $326,834 in the first six
months of 1999 to $3,575,797 in the first three months of 2000.

         During the first six months of 2000, total direct costs increased by
$2,216,428 to $2,619,834 compared to $403,406 in the first six months of 1999.
These direct costs included drilling and related costs for 17 natural gas wells.





                                        4
<PAGE>   5




                                     PART II
                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

         None.

ITEM 5. OTHER INFORMATION.

         Not Applicable.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

         (a) List of Documents Filed with this Report.
                                                                          PAGE
                                                                          ----
         (1) Balance Sheet for the Period Ended June 30, 2000............   i
             Income Statement for the Period Ended June 30, 2000......... ii-iii
             Segmented Information.......................................   iv
             Computation of Per Share Earnings...........................   v

         All schedules have been omitted since the information required to be
submitted has been included in the financial statements or notes or has been
omitted as not applicable or not required.

         (2) Exhibits--

         The exhibits indicated by an asterisk (*) are incorporated by
reference.

  EXHIBIT
  NUMBER    DESCRIPTION OF EXHIBIT

   3(a)*    Memorandum and Articles for Catalina Energy & Resources Ltd., a
            British  Columbia  corporation,  dated January 31, 1979,  filed as
            an exhibit to Form 10 Registration Statement filed May 25, 1984.
            (File No. 0-12185).

   3(b)*    Certificate for Catalina Energy & Resources Ltd., a British Columbia
            corporation, dated November 27, 1981, changing the name of Catalina
            Energy & Resources Ltd. to Alaska Apollo Gold Mines Ltd., and
            further changing the authorized capital of the Company from
            5,000,000 shares of common stock, without par value per share, to
            20,000,000 shares of common stock, without par value per share,
            filed as an exhibit to Form 10 Registration Statement filed May 25,
            1984. (File No. 0-12185).

   3(c)*    Certificate of Change of Name for Alaska Apollo Gold Mines Ltd., a
            British Columbia corporation, dated October 14, 1992, changing the
            name of Alaska Apollo Gold Mines Ltd. to Alaska Apollo Resources
            Inc., and further changing the authorized capital of the Company
            from 20,000,000 shares of common stock, without par value per share,
            to 6,000,000 shares of common stock, without par value per share.

   3(d)*    Altered Memorandum of Alaska Apollo Resources Inc., a British
            Columbia corporation, dated September 9, 1994, changing the
            authorized capital of the Company from 6,000,000 shares of common
            stock, without par value per share, to 20,000,000 shares of common
            stock, without par value per share.

   3(e)*    Certificate of Change of Name for Alaska Apollo Resources Inc., a
            British Columbia corporation, dated June 24, 1998, changing the name
            of Alaska Apollo Resources Inc. to



                                        5
<PAGE>   6

            Daugherty Resources, Inc. and further changing the authorized
            capital of the Registrant from 20,000,000 shares of common stock,
            without par value per share, to 50,000,000 shares of common stock,
            without par value, and authorizing the creation of 6,000,000 shares
            of preferred stock, without par value per share. (File No.0-12185).

   3(f)*    Altered Memorandum of Daugherty Resources, Inc., a British Columbia
            corporation, dated June 24, 1998, changing the authorized common
            stock of the Registrant from 50,000,000 shares of common stock,
            without par value per share, to 10,000,000 shares of common stock,
            without par value. (File No.0-12185).

   3(g)*    Altered Memorandum of Daugherty Resources, Inc., a British Columbia
            corporation, dated June 25, 1998, changing the authorized preferred
            stock of the Registrant from 6,000,000 shares of preferred stock,
            without par value per share, to 1,200,000 shares of preferred stock,
            without par value. Filed as an exhibit to Form 8-K, by the Company
            for reporting an event on June 29, 1998. (File No.0-12185).

   3 (h)*   Special Resolution of Daugherty Resources, Inc., a British Columbia
            corporation, dated June 30, 1999, changing the authorized capital of
            the Registration from 10,000,000 shares of common stock, without par
            value per share, to 100,000,000 shares of common stock, without par
            value per share, and from 1,200,000 shares of preferred stock,
            without par value per share, to 5,000,000 shares of preferred stock,
            without par value per share. Altered Memorandum of Daugherty
            Resources, Inc., dated June 30, 1999, changing the authorized
            capital of the Company to 105,000,000 shares divided into 5,000,000
            shares of preferred stock, without par value and 100,000,000 common
            shares without par value. Special Resolution of Daugherty Resources,
            Inc., a British Columbia corporation, dated June 30, 1999, altering
            Article 23.1(b) of the Company Articles by substituting a new
            Article 23.1(b) that sets forth the conditions and terms upon which
            the preferred shares can be converted to common stock. Filed as an
            exhibit to Form 8-K, for the Company for reporting an event on
            October 25, 1999. (File No.0-12185).


   4*       See Exhibit No. 3(a), (b), (c), (d), (e), (f), (g) and (h).

   10(a)*   Alaska Apollo Resources Inc. 1997 Stock Option Plan, filed as
            Exhibit 10(a) to Form 10-K for the Company for the fiscal year
            ended December 31, 1996. (File No. 0-12185).

   10(b)*   Incentive Stock Option Agreement by and between Alaska Apollo
            Resources Inc. and William S. Daugherty dated March 7, 1997, filed
            as Exhibit 10(b) to Form 10-K for the Company for the fiscal year
            ended December 31, 1996. (File No. 0-12185).

   10(c)*   Agreement of Purchase and Sale by and between Environmental Energy
            Partners I, Ltd., Environmental Energy Partners II, Ltd,
            Environmental Operating Partners, Ltd., Environmental Holding, LLC,
            Environmental Processing Partners, Ltd., Environmental Energy, Inc.,
            and Environmental Operating, Inc., as Sellers and Daugherty
            Petroleum, Inc., as Buyer, and Daugherty Resources, Inc. as
            Accommodating Party, dated as of January 26, 1999, filed as an
            Exhibit to Form 8-K by the Company for reporting an event on May 25,
            1999 (File No. 0-12185).

   10(d)*   Agreement for the Purchase and Sale by and between H&S Lumber, Inc.,
            Buyer, and Daugherty Petroleum, Inc., Seller, for the sale of Red
            River Hardwoods, Inc., an 80% subsidiary of Daugherty Petroleum,
            Inc., which was effective June 30, 1999, and closed December 1,
            1999, filed as Exhibit 10.1 to Form 8-K by the Company for reporting
            an event on December 9, 1999 (File No. 0-12185).

   11       Computation of Per Share Earnings.



                                        6
<PAGE>   7

   24       Powers of Attorney.

   27       Financial Data Schedule.

   (b)*     Reports on Form 8-K.
            None

   (c)      Financial Statement Schedules.

            No schedules are required, as all information required has been
            presented in the unaudited financial statements.




                                        7
<PAGE>   8




                                   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 of the
undersigned hereunto duly authorized.

                                         DAUGHERTY RESOURCES, INC.


                                         By: /s/ William S. Daugherty
                                            -------------------------------
                                            William S. Daugherty, President


Dated:  August 14, 2000

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.


<TABLE>
<CAPTION>


        SIGNATURE                           TITLE                             DATE
        ---------                           -----                             ----
<S>                               <C>                                      <C>
/s/ William S. Daugherty          Chairman of the Board, President,
--------------------------           Director of the Registrant            August 14, 2000
    William S. Daugherty



/s/ James K. Klyman *                Director of the Registrant            August 14, 2000
--------------------------
    James K. Klyman



/s/ Charles L. Cotterell *           Director of the Registrant            August 14, 2000
--------------------------
    Charles L. Cotterell




*By /s/ William S. Daugherty
    ------------------------
        William S. Daugherty
        Attorney-in-Fact

</TABLE>




                                        8
<PAGE>   9

DAUGHERTY RESOURCES. INC.
SUMMARY CONSOLIDATED BALANCE SHEETS
(United States Dollars)
Unaudited


                                                      6/30/99      6/30/00
                                                   ------------ ------------
                                   ASSETS

CURRENT ASSETS
  Cash                                             $    296,775 $    333,467
  Accounts receivable                                    64,798      189,768
  Inventory                                                  --           --
  Other current assets                                  530,000        4,439
                                                   ------------ ------------

           TOTAL CURRENT ASSETS                         891,573      527,674

OIL & GAS PROPERTIES (NET)                            4,614,704    6,877,934

MINING PROPERTY (NET)                                11,232,229    4,450,000

PROPERTY  & EQUIPMENT (NET)                             103,327      258,663

OTHER ASSETS
  Related party loans                                   256,427      317,661
  Bonds & deposits                                       41,000       41,000
  Other assets                                           99,297      110,586
  Goodwill, net of amortization of $1,207,954           760,567      581,610
                                                   ------------ ------------
                                                      1,157,291    1,050,857
                                                   ------------ ------------

           TOTAL ASSETS                            $ 17,999,124 $ 13,165,128
                                                   ============ ============


                    LIABILITIES & STOCKHOLDER'S EQUITY

CURRENT LIABILITIES
  Short-term loans & notes                         $  1,029,177 $  1,140,588
  Current portion of LT debt                            141,000      158,908
  Accounts payable                                      441,073      349,251
  Accrued liabilities                                   794,167    1,149,550
  Drilling prepayments                                  828,921      615,091
                                                   ------------ ------------

           TOTAL CURRENT LIABILITIES                  3,234,338    3,413,388

LONG-TERM LIABILITIES                                 1,591,902    1,863,298

PAYABLE TO RELATED PARTIES                              181,219       43,745
                                                   ------------ ------------
                                                      5,007,459    5,320,431

MINORITY INTEREST                                            --           --

STOCKHOLDER'S EQUITY
  Common stock                                       21,319,145   22,318,618
  Preferred stock                                                    650,000
  Common stock subscribed                                    --       73,497
  Additional paid in capital                                 --           --
  Retained earnings (deficit)                        (8,504,989) (15,725,909)
  Current income (loss)                                 177,509      528,491
                                                   ------------ ------------
                                                     12,991,665    7,844,697
                                                   ------------ ------------

           TOTAL LIABILITIES &
             STOCKHOLDER'S EQUITY                  $ 17,999,124 $ 13,165,128
                                                   ============ ============


Unaudited-Internally prepared by Company management



                                        i
<PAGE>   10



DAUGHERTY RESOURCES, INC.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(United States Dollars)
Unaudited
<TABLE>
<CAPTION>

                                                                For the six month period ended
                                                              6/30/99                     6/30/00
                                                      ---------------------       ----------------------

<S>                                                   <C>            <C>          <C>             <C>
GROSS REVENUE                                         $   539,611    100.00%      $  3,937,255    100.00%

DIRECT EXPENSES                                           403,406     74.76%         2,619,834     66.54%
                                                      -----------    ------       ------------    ------

           GROSS PROFIT                                   136,205     25.24%         1,317,421     33.46%

GENERAL & ADMINISTRATIVE EXPENSES
  Salaries & wages                                        184,088     34.11%           229,655      5.83%
  Accounting & audit                                       44,969      8.33%            45,209      1.15%
  Advertising & promotion                                      --      0.00%                --      0.00%
  Amortization                                             89,478     16.58%           116,999      2.97%
  Bad debts                                                    --      0.00%                --      0.00%
  Depreciation                                             20,400      3.78%            29,544      0.75%
  General consulting                                       30,530      5.66%           207,560      5.27%
  Insurance                                                14,588      2.70%            13,499      0.34%
  Legal                                                    79,498     14.73%            51,524      1.31%
  Office & general                                         59,109     10.95%             5,893      0.15%
  Payroll & property tax                                    9,839      1.82%            29,585      0.75%
  Rent                                                     28,444      5.27%            22,440      0.57%
  Repairs & maintenance                                     2,622      0.49%             6,100      0.15%
  Shareholder & investor information                        8,340      1.55%            18,636      0.47%
  Travel & entertainment                                   21,492      3.98%            46,721      1.19%
                                                      -----------    ------       ------------    ------

           TOTAL G & A EXPENSES                           593,397    109.97%           823,365     20.91%

OTHER INCOME (EXPENSE)
  Interest & dividend income                               27,277      5.05%            30,863      0.78%
  Miscellaneous                                                --      0.00%           126,895      3.22%
  Gain (loss) on sale of equipment                             --      0.00%             8,354      0.21%
  Interest expense                                        (86,944)   -16.11%          (131,677)    -3.34%
                                                      -----------    ------       ------------    ------

INCOME BEFORE INCOME TAX & OTHER                         (516,859)   -95.78%           528,491     13.42%

  Income tax expense (benefit)                                 --      0.00%                --      0.00%

DISCONTINUED OPERATIONS
  Income (loss) from discontinued operations             (238,904)   -44.27%                --      0.00%
   Gain (loss) on disposal                                933,272    172.95%                --      0.00%
                                                      -----------    ------       ------------    ------

           NET INCOME (LOSS)                          $   177,509     32.90%      $    528,491     13.42%
                                                      ===========    ======       ============    ======


DEFICIT, beginning of period                           (8,504,989)                $(15,725,909)
DEFICIT, end of period                                 (8,327,480)                $(15,197,418)


Shares outstanding                                      2,272,182                    2,545,540

EARNINGS PER SHARE                                    $      0.08                 $       0.21

</TABLE>

Unaudited-Internally prepared by Company management


                                       ii



<PAGE>   11




DAUGHERTY RESOURCES, INC.
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(United States Dollars)
Unaudited
<TABLE>
<CAPTION>

                                                                            For the six month period ended
                                                                             6/30/99                6/30/00
                                                                           -----------            -----------
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                                        <C>                    <C>
  Net income (loss)                                                          $ 177,509           $   528,491
  Adjustments to reconcile net income (loss) to net cash
  provided by operating activities:
    Depreciation, depletion, & amortization                                    205,878               306,543
    Gain on sale of subsidiary                                                (963,731)                   --

    Changes in current assets & liabilities
      (Increase) decrease in:
        Accounts receivable                                                     74,689                28,100
        Inventory                                                                   --                    --
        Other current assets                                                  (487,795)               (4,439)
      Increase (decrease) in:
        Short-term loans & notes                                               887,348               (15,849)
        Accounts payable                                                      (128,749)             (340,905)
        Accrued liabilities                                                     33,892               498,395
        Drilling prepayments                                                   (96,589)           (1,921,373)
                                                                             ---------           -----------
            Net cash provided by (used in) operating activities               (297,548)             (921,037)


CASH FLOWS FROM INVESTING ACTIVITIES
  Change in oil & gas properties                                               (59,602)           (1,152,109)
  Change in mining properties                                                       --                    --
  Change in property & equipment                                                (1,322)             (178,146)
  Change in other assets                                                       120,793                 5,842
                                                                             ---------           -----------
            Net cash provided by (used in) investing activities                 59,869            (1,324,413)


CASH FLOWS FROM FINANCING ACTIVITIES
  Issuance of common stock                                                     109,324               311,387
  Change in long-term liabilities                                             (516,473)               82,121
  Change in payable to related party                                           445,847               (91,698)
                                                                             ---------           -----------
            Net cash provided by (used in) financing activities                 38,698               301,810
                                                                             ---------           -----------

NET INCREASE (DECREASE) IN CASH                                               (198,981)           (1,943,640)
                                                                                                 -----------

CASH AT BEGINNING OF PERIOD                                                    495,756             2,277,107
                                                                             ---------           -----------
CASH AT END OF PERIOD                                                        $ 296,775           $   333,467
                                                                             =========           ===========
</TABLE>


Unaudited-Internally prepared by Company management



                                      iii
<PAGE>   12

DAUGHERTY RESOURCES, INC.
SEGMENTED INFORMATION
For the six month period ended June 30,2000
(United States Dollars)
Unaudited

<TABLE>
<CAPTION>
                                                             WOOD
                                     OIL & GAS    MINING   PRODUCTS*  CORPORATE    TOTAL
                                     ---------    ------   ---------  ---------    -----
<S>                                 <C>           <C>      <C>        <C>      <C>
GROSS EXTERNAL REVENUE              $3,937,255         --     --           --  $ 3,937,255

INTERSEGMENT REVENUES                       --         --     --           --           --

INTEREST REVENUE                        21,711         --     --        9,152       30,863

INTEREST EXPENSE                        89,392         --     --       42,285      131,677

DEPRECIATION                            29,544         --     --           --       29,544

DEPLETION                              160,000         --     --           --      160,000

AMORTIZATION OF GOODWILL                    --         --     --       89,478       89,478


SEGMENT PROFIT (LOSS)               $  986,154         --     --     (457,663) $   528,491
                                    ==========  =========    ===    =========  ===========


SEGMENT ASSETS                      $6,877,934  4,450,000     --    1,837,194  $13,165,128
                                    ==========  =========    ===    =========  ===========
EXPENDITURES FOR SEGMENT
      ASSETS                        $1,152,109         --     --      178,146  $ 1,330,255
                                    ==========  =========    ===    =========  ===========
</TABLE>


*Discontinued operation.

Unaudited-Internally prepared by Company management


                                       iv