-----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, IbvNSRtV/FnoWQbMwGzNhZmY6ZBl6GpreNZx9loH7MqEyN243sFktX0Rr2Lb7EUH DNlP+Mnf1ajFSO6YNVgwuw== 0000950152-96-002443.txt : 19960517 0000950152-96-002443.hdr.sgml : 19960517 ACCESSION NUMBER: 0000950152-96-002443 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960515 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: OMNICARE INC CENTRAL INDEX KEY: 0000353230 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-DRUG STORES AND PROPRIETARY STORES [5912] IRS NUMBER: 311001351 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08269 FILM NUMBER: 96564775 BUSINESS ADDRESS: STREET 1: 255 EAST FIFTH ST STREET 2: 2800 CHEMED CENTER CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5137626666 MAIL ADDRESS: STREET 1: 2800 CHEMED CENTER STREET 2: 255 EAST FIFTH ST CITY: CINCINNATI STATE: OH ZIP: 45202-4728 10-Q 1 OMNICARE 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Quarterly Report Under Section 13 or 15(d) of The Securities Exchange Act of 1934 For Quarter Ended March 31, 1996 Commission File Number 1-8269 OMNICARE, INC. -------------- Incorporated under the laws of I.R.S. Employer Identification State of Delaware No. 31-1001351 2800 Chemed Center, 255 E. Fifth Street, Cincinnati, Ohio 45202-4728 - --------------------------------------------------------------------- (Address of Principal Executive Offices and Zip Code) Registrant's telephone number, including area code (513) 762-6666 - ------------------------------------------------------------------- Indicate by check mark whether the registrant: 1) has filed all reports required to be filed by Section 13 or 15(6) 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 requirement for the past 90 days. Yes x No --- --- COMMON STOCK OUTSTANDING - ------------------------
Number of Shares Date ---------- -------------- Common Stock, $1 par value 32,325,381 March 31, 1996
2 OMNICARE, INC. AND ------------------ SUBSIDIARY COMPANIES -------------------- Index Page ---- Part I. Financial Information: Item 1. Financial Statements Consolidated Balance Sheet - March 31, 1996 and December 31, 1995 3 Consolidated Statement of Income - Three months ended - March 31, 1996 and 1995 4 Consolidated Statement of Cash Flow - Three months ended - March 31, 1996 and 1995 5 Notes to Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition 7 Part II. Other Information: Item 6. Exhibits and Reports on Form 8-K 10 -2- 3 Item 1. Financial Statements -------------------- OMNICARE, INC. AND SUBSIDIARY COMPANIES Consolidated Balance Sheet UNAUDITED
(in thousands except share data) March 31, December 31, ASSETS 1996 1995 --------- --------- Current assets: Cash and cash equivalents $ 311,668 $ 40,137 Accounts receivable, less allowances 83,670 80,247 Inventories 34,121 28,841 Deferred income tax benefits 6,505 6,600 Other current assets 5,861 5,247 --------- --------- Total current assets 441,825 161,072 Properties and equipment, at cost less accumulated depreciation 36,733 32,458 Goodwill, less accumulated amortization 162,125 157,843 Other assets 9,659 9,463 --------- --------- Total assets $ 650,342 $ 360,836 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 20,729 $ 22,020 Amounts payable pursuant to acquisition agreements 4,031 13,642 Current portion of long-term debt 1,028 1,051 Income taxes payable 3,681 -- Accrued employee compensation 4,118 5,338 Liabilities relating to discontinued operations 1,367 1,547 Other current liabilities 10,182 11,090 --------- --------- Total current liabilities 45,136 54,688 Long-term debt 82,298 82,692 Deferred income taxes 2,807 2,621 Amounts payable pursuant to acquisition agreements 3,309 1,418 Other noncurrent liabilities 4,935 4,656 --------- --------- Total liabilities 138,485 146,075 --------- --------- Stockholders' equity: Preferred stock-authorized 1,000,000 shares without par value; none issued Common stock-authorized 44,000,000 shares $1 par; 32,378,642 shares issued (1995-26,344,508 shares) 32,379 26,345 Paid-in capital 392,211 99,686 Retained earnings 100,935 93,598 --------- --------- 525,525 219,629 Treasury stock, at cost-53,261 shares (1995-24,268 shares) (2,006) (462) Deferred compensation (9,552) (2,126) Unallocated stock of ESOP (2,110) (2,260) --------- --------- Total stockholders' equity 511,857 214,761 --------- --------- Total liabilities and stockholders' equity $ 650,342 $ 360,836 ========= =========
The Notes to Consolidated Financial Statements are an integral part of this statement. -3- 4 OMNICARE, INC. AND SUBSIDIARY COMPANIES Consolidated Statement of Income UNAUDITED (In thousands except per share data)
Three Months Ended March 31, --------------------------- 1996 1995(a) --------- ------- Sales $ 117,185 $90,527 Cost of sales 83,553 65,879 --------- ------- Gross profit 33,632 24,648 Selling, general and administrative expenses 19,433 15,413 --------- ------- Operating income 14,199 9,235 Investment income 560 1,096 Interest expense (1,320) (1,631) --------- ------- Income before income taxes 13,439 8,700 Income taxes 5,310 3,449 --------- ------- Net income $ 8,129 $ 5,251 ========= ======= Earnings per share: Primary $ .29 $ .20 ========= ======= Fully diluted $ .27 $ .19 ========= ======= Dividends paid per share $ .03 $ .023 ========= ======= Weighted average number of common shares outstanding: Primary 27,924 25,968 ========= ======= Fully diluted 33,549 32,271 ========= ======= (a) Restated for the June 30, 1995 acquisition of Specialized Pharmacy Services, Inc. in a pooling of interests transaction.
The Notes to Consolidated Financial Statements are an integral part of this statement. -4- 5 OMNICARE, INC. AND SUBSIDIARY COMPANIES Consolidated Statement of Cash Flow UNAUDITED
(in thousands) Three Months Ended March 31, ---------------------------- 1996 1995 --------- -------- Cash flow from operating activities: Net income $ 8,129 $ 5,251 Adjustments to reconcile net income to net cash flow from operating activities: Depreciation and amortization 3,183 2,464 Provision for doubtful accounts 1,279 560 Deferred tax provision 261 26 Changes in assets and liabilities, net of effects from acquisition/disposal of businesses: Accounts receivable (3,714) (3,055) Inventories (4,373) (2,804) Current and noncurrent assets (672) (377) Income taxes payable 3,681 1,438 Payables and accrued liabilities (2,546) 2,303 Current and noncurrent liabilities 462 (1,693) --------- -------- Net cash flow from operating activities 5,690 4,113 --------- -------- Cash flow from investing activities: Acquisition of businesses (12,805) (8,028) Capital expenditures (5,813) (3,019) Marketable securities -- (735) Proceeds from sale of properties and equipment 33 65 Cash flow from discontinued operations (180) (176) --------- -------- Net cash flow from investing activities (18,765) (11,893) --------- -------- Cash flow from financing activities: Net borrowings on line-of-credit -- (50) Proceeds from long-term borrowings -- 50 Principal payments on long-term obligations (136) (244) Net proceeds from stock offering 286,529 -- Exercise of stock options and warrants, net (995) (280) Dividends paid (792) (633) --------- -------- Net cash flow from financing activities 284,606 (1,157) --------- -------- Net increase (decrease) in cash and cash equivalents 271,531 (8,937) Cash and cash equivalents at beginning of period 40,137 34,553 --------- -------- Cash and cash equivalents at end of period $ 311,668 $ 25,616 ========= ======== Supplemental disclosures of cash flow information - ------------------------------------------------- Income taxes paid $ -- $ 1,213 Interest paid 2,426 2,511
The Notes to Consolidated Financial Statements are an integral part of this statement. -5- 6 OMNICARE, INC. AND SUBSIDIARY COMPANIES Notes to Consolidated Financial 3tatements 1. The interim financial data are unaudited; however, in the opinion of the management of Omnicare, Inc., the interim data include all adjustments (which include only normal adjustments) considered necessary for a fair presentation of the consolidated financial position, results of operations and cash flow of Omnicare, Inc. and its consolidated subsidiaries ("Company") . 2. Since January 1, 1996, the Company has completed four acquisitions including Medical Arts Health Care, Inc. in Conyers, Georgia, Managed Health Care in Springfield, Missouri, and Pharmacy Care Systems Division of Big B, Inc. in Bessemer, Alabama, all in January, and Benwood Pharmacy Services, Inc., Buffalo, New York, in February. All of these transactions have been accounted for as purchase transactions and, accordingly, the purchase price paid for each has been allocated to the fair value of the assets acquired and liabilities assumed. The results of operations of the acquired companies have been included in consolidated results of the Company from the effective dates of the acquisitions. 3. On February 7, 1996, the Board of Directors declared a 20% increase in the Company's quarterly cash dividend to 3 cents per share from the 2.5 cents per share paid in each quarter of 1995. 4. In March 1996, the Company completed a public offering of 5,750,000 shares of common stock resulting in gross proceeds of $298,281,000 (before underwriting discounts and expenses). -6- 7 Item 2. Management's Discussion and Analysis of Results of Operations and ----------------------------------------------------------------- Financial Condition. -------------------- Results of Operations Net income for the three months ended March 31, 1996 increased 55% to $8,129,000 from the $5,251,000 earned in the first quarter of 1995. Earnings per share, on a primary basis, rose 45% to $.29 from the $.20 earned for the same period of 1995. On a fully diluted basis, earnings per share increased 42% to $.27 versus the $.19 earned for the first quarter of 1995. The average number of shares outstanding rose 7%, on a primary basis, and 4%, on a fully diluted basis, over the comparable prior-year period. Sales for the first three months of 1996 of $117,185,000 were 29% higher than the $90,527,000 recorded in the comparable prior-year period. The increases in the Company's sales and earnings were the product of its continued focus on acquisitions of long-term care pharmacy providers and sustained internal growth. During the first three months of 1996, the Company acquired four institutional pharmacy providers, adding more than 8,300 new nursing facility residents to those already served by the Company. The Company purchased Medical Arts Health, Inc., which serves 2,200 nursing home residents in the Atlanta, Georgia area. The Company also completed the acquisition of Pharmacy Care Systems, the nursing home pharmacy division of retail drug chain Big B, Inc., which serves approximately 1,700 long-term care facility residents in Birmingham, Alabama and Atlanta, Georgia. In addition, the Company acquired Benwood Pharmacy Services, Inc., which serves 1,450 long-term care residents in the Buffalo, New York area and Managed Health Care, which serves 3,000 residents in long-term care facilities in southern Missouri . These four acquisitions, combined with internal growth, brought the total number of nursing facility residents served to 229,600 at March 31, 1996, up 37% over the number served one year ago. -7- 8 Along with the addition of new clients, internal growth also benefited from higher acuity levels among nursing facility residents, as well as the continued expansion of the Company's infusion therapy services. Interest expense, net of investment income, increased by 42% to $760,000 in 1996 due to a significant decrease in the invested cash balance during the quarter, owing primarily to the use of funds for the acquisition of businesses during the twelve month period ended March 31, 1996. The effective tax rate of 39.5% for the first quarter of 1996 was comparable to the rate of 39.6% for the prior year quarter. Liquidity and Capital Resources Cash and cash equivalents at March 31, 1996 increased by $271,531,000 to $311,668,000 from the $40,137,000 balance at December 31, 1995. In March 1996, the Company completed a public offering of 5,750,000 shares of common stock resulting in gross proceeds of $298,281,000 (before underwriting discounts and expenses) . The company's capital requirements are primarily related to its acquisition program. In the first quarter of 1996, the Company made four acquisitions for an aggregate capital investment of approximately $12 million. Such acquisitions were financed from cash and cash equivalents and the issuance of 17,954 shares of common stock for the Medical Arts acquisition. There are no material commitments outstanding at March 31, 1996 other than acquisition-related payments which may be made contingent on the performance of businesses acquired. The Company has a $135 million revolving credit facility with a consortium of six banks. No amounts were outstanding at March 31, 1996 under the credit facility. The Company's current ratio at March 31, 1996 and December 31, 1995 was 9.8 to 1 and 2.9 to 1, respectively . On February 7, 1996, the Company's Board of Directors increased -8- 9 the quarterly cash dividend by 20% to 3 cents per share for an indicated annual rate of 12 cents per share in 1996. Dividends of $792,000 were paid in March 1996 versus the $632,000 paid in March 1995. The Company believes its sources of capital are adequate for its needs . -9- 10 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Exhibits Exhibit Page Number Exhibit Number ------ ------- ------ 11 Computation of Earnings per Share 11 (b) REPORTS ON FORM 8-K - On February 26, 1996, a Form 8-K was filed to report the audited financial statements and management's discussion and analysis of operations and financial condition as of and for the three years in the period ended December 31, 1995. 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. Omnicare, Inc. -------------------------- (Registrant) Date May 14, 1996 By /s/ Joel F. Gemunder ---------------------- -------------------------- Joel F. Gemunder President (Principal Executive Officer) Date May 14, 1996 By /s/ David W. Froesel, Jr. ---------------------- -------------------------- David W. Froesel, Jr. Senior Vice President and Chief Financial Officer (Principal Financial Officer) -10- EX-11 2 EXHIBIT 11 1 Exhibit 11 Omnicare, Inc. and Subsidiary Companies Computation of Earnings Per Common Share (in thousands, except per share data)
Three Months Ended March 31, -------------------- 1996 1995 -------- -------- Primary Earnings Net income $ 8,129 $ 5,251 Other (6) (1) -------- -------- Net income as adjusted $ 8,123 $ 5,250 ======== ======== Shares Weighted average number of common shares outstanding 26,863 25,968 Additional shares assuming conversion of stock options and stock warrants 1,061 634 -------- -------- Average common shares outstanding and equivalents as adjusted 27,924 26,602 -------- -------- Primary earnings per common share $ 0.29 $ 0.20 ======== ======== Fully Diluted Earnings Net income $ 8,129 $ 5,251 Aftertax interest expense related to 5 3/4% convertible subordinated debentures 798 803 Other (6) (1) -------- -------- Net income as adjusted $ 8,921 $ 6,053 ======== ======== Shares Weighted average number of common shares outstanding 26,863 25,968 Additional shares assuming conversion of: Stock options and stock warrants 1,131 727 Convertible subordinated debentures 5,555 5,576 -------- -------- Average common shares outstanding and equivalents as adjusted 33,549 32,271 -------- -------- Fully diluted earnings per common share $ 0.27 $ 0.19 ======== ========
-11- EX-27.1 3 EXHIBIT 27.1
5 0000353230 OMNICARE, INC. 3-MOS DEC-31-1996 MAR-31-1996 311,668 0 89,416 5,746 34,121 441,825 57,752 21,019 650,342 45,136 82,298 32,379 0 0 479,478 511,857 117,185 117,185 83,553 83,553 19,433 1,279 1,320 13,439 5,310 8,129 0 0 0 8,129 .29 .27
EX-27.2 4 EXHIBIT 27.2
5 0000353230 OMNICARE, INC. 3-MOS DEC-31-1995 JAN-01-1995 MAR-31-1995 25,616 45,980 69,231 3,891 25,264 172,450 39,458 13,852 337,025 50,072 85,175 15,609 0 0 178,326 337,025 90,527 90,527 65,879 65,879 15,413 560 1,631 8,700 3,449 5,251 0 0 0 5,251 .20 .19
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