-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H2l2YJILGMEUXIr70HRtd3VDJA7ht4i+fuC61NUx8jfD4q3Ajwryj/QqlDGECGY/ 6P9/OAGa8KLnEofb/G1JmA== 0000950116-97-002067.txt : 19971117 0000950116-97-002067.hdr.sgml : 19971117 ACCESSION NUMBER: 0000950116-97-002067 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19971114 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMPLETE MANAGEMENT INC CENTRAL INDEX KEY: 0001002063 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 113149119 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: SEC FILE NUMBER: 001-14356 FILM NUMBER: 97718050 BUSINESS ADDRESS: STREET 1: 254 W 31ST ST CITY: NEW YORK STATE: NY ZIP: 10004 BUSINESS PHONE: 2128681188 MAIL ADDRESS: STREET 1: 254 WEST 31ST STREET CITY: NEW YORK STATE: NY ZIP: 10001-2813 10-Q/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q/A (Mark One) (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1997 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: 0-27260 COMPLETE MANAGEMENT, INC. (Exact name of registrant as specified in its charter)
New York 11-3149119 - ---------------------------------------------- -------------------------------------------------- (State or other Jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 254 West 31st Street, New York, NY 10001-2813 - ---------------------------------------------- -------------------------------------------------- (Address of principal executive offices) (Zip Code)
(212) 273-0600 --------------- (Registrant's telephone number, including area code) Not applicable -------------- (Former name, former address and former fiscal year, if changed since last report) 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 --- --- As of August 13, 1997 the registrant had a total of 10,441,667 shares of Common Stock outstanding. There was no Preferred Stock outstanding. COMPLETE MANAGEMENT, INC. Index to Form 10-Q/A June 30, 1997 PART I. FINANCIAL INFORMATION Page ---- Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations............................................... 3 SIGNATURES................................................................. 5 2 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion of the results of the operations and financial condition of CMI should be read in conjunction with CMI's Unaudited Condensed Consolidated Financial Statements and Notes thereto included elsewhere in this Quarterly Report. Results of Operations Comparison of the Six Months Ended June 30, 1997 and 1996 Revenues in 1997 was $33,143,000 as compared to $11,263,000 in 1996, an increase of $21,880,000. The primary reasons for the increase was the acquisitions of the medical billing companies which added $3,187,000, the physician practice management companies which added $10,831,000 and $3,909,000 from the additional practices under management. In addition, management services rendered by the Company to GMMS increased by $1,405,000 as a result of an increase in the number of patient procedures performed by GMMS. Also, an increase in the volume of diagnostic imaging scans in 1997 provided both to GMMS as well as to several New York metropolitan area hospital clients resulted in an incremental $1,699,000 during 1997. Cost of revenues increased to $15,116,000 from $3,725,000 in 1996, an increase of $11,391,000. Cost of revenues include personnel who directly support the medical practices in rendering patient care and who directly support its billing and collection process. The support services include patient scheduling and assisting patients in producing background and medical coverage information necessary for physicians to properly diagnose, test and bill for services rendered by the medical practices. The Company charges fees to its clients for the services rendered by these individuals under the terms of its Practice Management Services Agreements with the medical practices. The fees are predicated upon the costs associated with rendering this service. The increase was primarily due to an additional $6,844,000 of costs from the acquisitions of the medical billing companies, and the physician practice management companies and $917,000, primarily attributable to the additional practices under management. An additional $3,630,000 increase was from the Company's continued strategy to hire management and support personnel in order to properly service the expanding medical practices. General and administrative expenses increased to $10,430,000 in 1997 from $2,731,000 in 1996, an increase of $7,699,000. General and administrative costs represent overhead and administrative expenses, excluding costs directly related to operations and generation of revenues such as space costs, office supplies costs of the Company, including corporate management and professional fees. A major component of this increase was $3,120,000 from the acquisitions of the medical billing companies in July 1996 and the physician practice management companies. Corporate expenses also increased due to the hiring of highly qualified management personnel in order to prepare for the Company's continuing growth through acquisitions and the amortization of goodwill related to the acquisitions completed in 1996 and 1997. These costs increased $4,099,000 over 1996 levels. The Company's philosophy has been to significantly upgrade and increase its infrastructure to ensure its ability to adequately service additional clients and anticipated acquisitions while continuing to provide a comprehensive range of management services to the client practices. Interest expense increased to $3,193,000 in 1997 from $587,000 in 1996 due mainly to interest on the (a) $2,000,000 principal amount of Convertible Subordinated Notes issued on March 20, 1996, (b) First Series Debentures issued on June 5, 1996, in the principal amount of $40,250,000 (c) $3,000,000 principal amount of Convertible Subordinated Notes issued on July 5, 1996 (d) Second Series Debentures issued on December 5, 1996, in the principal amount of $28,750.000 and (e) $10,000,000 of borrowings under a line of credit. 3 Comparison of the Three Months Ended June 30, 1997 and 1996 Revenues in the current quarter were $17,760,000 as compared to $6,063,000 in 1996, an increase of $11,697,000. The primary reasons for the increase were the acquisitions of two medical billing companies which added $1,733,000, the physician practice management companies, which added $5,690,000, the preferred provider organization added $553,000 and $2,905,000 from the additional practices under management. In addition, an increase in management services rendered by the Company to GMMS as well as an increase in the use of diagnostic imaging equipment and other services provided resulted in an incremental $816,000 during the period. Cost of revenues increased to $9,384,000 from $2,000,000 in 1996, an increase of $7,384,000. Cost of revenues include personnel who directly support the medical practices in rendering patient care and who directly support its billing and collection process. The support services include patient scheduling and assisting patients in producing background and medical coverage information necessary for physicians to properly diagnose, test and bill for services rendered by the medical practices. The increase was primarily due to an additional $1,132,000 of costs from the acquisitions of two medical billing companies, $3,709,000 from the acquisition of physician practice management companies and $612,000, primarily attributable to the additional practices under management. An additional $1,931,000 increase was from the Company's continued strategy to hire management and support personnel in order to properly service the expanding medical practices. General and administrative expenses increased to $4,615,000 in 1997 from $1,408,000 in 1996, an increase of $3,207,000. General and administrative costs represent overhead and administrative expenses, excluding costs directly related to operations and generation of revenues such as space costs, office supplies costs of the Company, including corporate management and professional fees. A major component of this increase was $337,000 from the acquisitions of two medical billing companies, $267,000 from the acquisition of the physician practice management companies and $132,000 from acquisition of a preferred provider organization. Corporate expenses also increased due to the hiring of highly qualified management personnel in order to prepare for the Company's continuing growth through acquisitions and the amortization of goodwill related to the acquisitions completed in 1996 and 1997. These costs increased $2,471,000 over 1996 levels. The Company's philosophy has been to significantly upgrade and increase its infrastructure to ensure its ability to adequately service additional clients and anticipated acquisitions while continuing to provide a comprehensive range of management services to the client practices. Interest expense increased to $1,659,000 in 1997 from $447,000 in 1996 due mainly to interest on the (a) First Series Debentures issued on June 5, 1996, in the principal amount of $40,250,000 (b) $3,000,000 principal amount of Convertible Subordinated Notes issued on July 5, 1996 (c) Second Series Debentures issued on December 5, 1996, in the principal amount of $28,750.000 and (d) $10,000,000 of borrowings under a line of credit. 4 COMPLETE MANAGEMENT, INC. 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. COMPLETE MANAGEMENT, INC. -------------------------------------------------- (Registrant) Date: November 14, 1997 /s/ STEVEN RABINOVICI ------------------ -------------------------------------------------- Steven Rabinovici Chief Executive Officer and Chairman Date: November 14, 1997 /s/ ARTHUR GOLDBERG ------------------ -------------------------------------------------- Arthur Goldberg Senior Executive Vice President, Chief Financial Officer and Director Date: November 14, 1997 /s/ ALAN GOLDSTEIN ------------------ -------------------------------------------------- Alan Goldstein Chief Accounting Officer and Vice President - Finance 5 -----END PRIVACY-ENHANCED MESSAGE-----