-----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, H6OQXXPybti8ApYe8PpnQpVjYRffYVmG5klxxRdyTmxyC7S3lyaR6jcaf9PRsP6H t9AL6n6/6Rzm/WS2+qfRQg== 0000943763-99-000002.txt : 19990115 0000943763-99-000002.hdr.sgml : 19990115 ACCESSION NUMBER: 0000943763-99-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981130 FILED AS OF DATE: 19990114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNIHOLDING CORP CENTRAL INDEX KEY: 0000354199 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MEDICAL LABORATORIES [8071] IRS NUMBER: 581443790 STATE OF INCORPORATION: DE FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-09833 FILM NUMBER: 99506270 BUSINESS ADDRESS: STREET 1: 96 SPRING STREET STREET 2: 8TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10012 BUSINESS PHONE: 2122199496 MAIL ADDRESS: STREET 1: 96 SPRING ST STREET 2: 8TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10012 FORMER COMPANY: FORMER CONFORMED NAME: UNITED FASHIONS INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: CP OVERSEAS INC DATE OF NAME CHANGE: 19901009 FORMER COMPANY: FORMER CONFORMED NAME: IRT REALTY SERVICES INC DATE OF NAME CHANGE: 19880501 10-Q 1 UNIHOLDING 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended November 30, 1998 [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period to Commission File No. 0-9833 UNIHOLDING CORPORATION (Exact name of registrant as specified in its charter) Delaware 58-1443790 (State or other jurisdiction (I.R.S. Employer of incorporation) Identification Number) 96 Spring Street, 8th Floor, New York, New York 10012 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 219-9496 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 January 13, 1999, there were 6,079,151 shares of Common Stock, par value $0.01 per share, of the Registrant outstanding. 1 UNIHOLDING CORPORATION AND SUBSIDIARIES Form 10-Q for the Quarterly Period Ended November, 30, 1998 INDEX Page Part I - FINANCIAL INFORMATION: Item 1. Financial Statements 3 Consolidated Balance Sheets - November 30, 1998 (unaudited) and May 31, 1998 4 Unaudited Consolidated Statements of Operations - Three month and six month periods ended November 30, 1998, and November 30, 1997 6 Unaudited Consolidated Statements of Cash Flows - Six month periods ended November 30, 1998, and November 30, 1997 7 Notes to Unaudited Consolidated Financial Statements 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 13 Part II - OTHER INFORMATION: Item 1. Legal Proceedings 16 Item 6. Exhibits 17 Signatures 18 2 PART I - FINANCIAL INFORMATION Item 1. Financial Statements 3 UNIHOLDING CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands)
ASSETS November May 31, 30, 1998 1998 --------------- ------------ (Unaudited) CURRENT ASSETS: Cash and cash equivalents $6,155 $9,186 Accounts receivable, net of allowance for doubtful accounts 20,853 19,464 Due from related companies 2,782 1,587 Inventories 1,853 1,849 Prepaid expenses 1,740 3,090 Other current assets 437 411 ---------- ---------- Total current assets 33,820 35,587 ---------- ---------- NON-CURRENT ASSETS: Long-term notes receivable 818 818 Deferred tax assets 289 157 Intangible assets, net 46,507 44,344 Property, plant and equipment, net 20,546 8,828 Investment in equity affiliates 550 481 Long-term investments 23,289 22,781 Other assets, net 232 132 ---------- ---------- Total non-current assets 91,942 77,384 ---------- ---------- $125,762 $112,971 ========== ==========
See notes to financial statements 4 UNIHOLDING CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY November May 31, 30, 1998 1998 ------------- ------------ (Unaudited) CURRENT LIABILITIES: Bank overdrafts $2,886 $4,010 Lease payable 701 809 Payable to related parties 109 100 Trade payables 7,028 6,911 Accrued liabilities 7,253 6,018 Long-term debt 6,866 5,727 Taxes payable 6,682 6,459 Deferred taxes - 769 ----------- ----------- Total current liabilities 31,525 30,803 ----------- ----------- NON-CURRENT LIABILITIES Lease payable 557 725 Long-term debt 42,511 29,544 Taxes payable 77 74 Deferred taxes 33 179 ----------- ----------- Total non-current liabilities 43,178 30,522 ----------- ----------- Total liabilities 74,703 61,325 ----------- ----------- MINORITY INTERESTS 9,323 9,440 ----------- ----------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common stock, $0.01 par value; Voting; authorized 18,000,000 shares; issued 7,627,736 at November 30 and May 31, 1998 $ 76 76 Non-Voting; authorized 2,000,000 shares; issued and outstanding 298,384 at November 30 and May 31, 1998 3 3 Additional paid-in capital 49,832 49,832 Cumulative translation adjustment (969) (2,074) Retained earnings 8,498 7,623 ----------- ----------- 57,440 55,460 Less - cost of 2,006,969 and 1,602,569 shares of Common Stock held in treasury at November 30 and May 31, 1998, respectively (15,704) (13,254) ----------- ----------- Total stockholders' equity 41,736 42,206 ----------- ----------- $125,762 $112,971 ======== ===========
See notes to financial statements 5 UNIHOLDING CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share data)
Three Months ended Six Months ended November 30, November 30, 1998 1997 1998 1997 ----------- ----------- ----------- ----------- REVENUE $26,942 $18,074 $47,484 $37,848 Operating expenses: Salaries and related charges 10,458 6,545 19,990 15,190 Supplies 4,693 2,935 8,356 6,553 Other operating expenses 6,533 5,408 11,945 10,745 Depreciation and amortization of tangible assets 719 540 1,313 1,691 Amortization of intangible assets 806 609 1,552 1,091 ----------- ----------- ----------- ----------- OPERATING INCOME 3,733 2,037 4,328 2,578 Interest, net (626) 1 (1,047) (271) Other, net 24 2,601 193 2,908 ----------- ----------- ----------- ----------- Income before taxes and minority interests 3,131 4,639 3,474 5,215 Tax provision (907) (606) (1,124) (874) ----------- ----------- ----------- ----------- Income from continuing operations before minority interests 2,224 4,033 2,350 4,341 Minority interests in income of continuing operations (1,263) (730) (1,475) (882) ----------- ----------- ----------- ----------- Income from continuing operations 961 3,303 875 3,459 Loss from discontinued operations, net of taxes and minority interests - (1,379) - (2,499) ----------- ----------- ----------- ----------- NET INCOME $961 $1,924 $875 $960 ========== =========== =========== =========== Weighted average common shares outstanding 5,926,184 7,581,870 6,064,519 7,754,936 Earnings per share of common stock Net income from continuing operations $0.16 $0.44 $0.14 $0.45 Loss from discontinued operations - ($0.18) - ($0.32) Net income $0.16 $0.25 $0.14 $0.12
6 See notes to financial statements UNIHOLDING CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands)
Six Months ended November 30, 1998 1997 ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income from continuing operations $875 $3,459 Adjustments to reconcile net income to net cash provided by operations: Minority interests in income 1,475 1,083 Deferred taxes (940) (175) Depreciation and amortization of tangible assets 1,313 1,168 Amortization of intangible assets 1,552 1,062 Other non-cash (income) expenses 762 (2,847) Net changes in assets and liabilities, net of acquisitions: Accounts receivable (514) (953) Inventories 78 (63) Prepaid expenses 1,468 (57) Other current assets 17 (88) Trade payables (167) (171) Accrued liabilities 1,031 365 Taxes payable 141 (806) ----------- ----------- Net cash provided by (used in) operating activities 7,091 1,977 ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES: Repayment of long-term debt (3,115) (821) Cash proceeds from long-term debt 6,977 - Proceeds (reimbursement) from (of) bank overdrafts (1,277) 861 Dividend paid to minority shareholders (1,819) (1,317) Repayment of lease debt (435) (113) Payment for purchase of treasury stock (2,450) (3,977) ----------- ----------- Net cash provided by (used in) financing activities (2,119) (5,367) ----------- -----------
(continued) 7 UNIHOLDING CORPORATION AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) (continued)
Six Months ended November 30, 1998 1997 ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Payment for purchases of property and equipment ($4,119) ($847) Loans and advances (to) from affiliates and related companies, net (1,919) 1,555 Payment for purchase of interest in subsidiaries (72) (242) Payment for purchase of intangible assets (2,243) (712) Proceeds from sale of assets - 743 --------- --------- Net cash (used in) provided by investing activities (8,353) 497 --------- --------- Effect of exchange rate changes on cash 350 (94) Net increase (decrease) in cash and cash equivalents from continuing operations (3,031) (2,987) Net cash flows provided by discontinued operations - 276 Cash and cash equivalents, beginning of year 9,186 4,925 --------- --------- Cash and cash equivalents, end of period $6,155 $2,214 ======== =========
See notes to financial statements 8 UNIHOLDING CORPORATION AND SUBSIDIARIES NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Monetary amounts in thousands, except per share data) 1. Basis of Presentation The consolidated financial statements include the accounts of UniHolding and its majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The investment in the Company's equity affiliates is accounted for on the equity method. Prior periodsO financial statements have been restated to reflect the effect of discontinued operations. 2. Management Opinion In the opinion of management, the accompanying unaudited interim financial statements reflect all adjustments that are necessary to present fairly the financial position, results of operations and cash flows for the interim periods reported. All such adjustments made were of a normal recurring nature. The results of operations and financial position for interim periods are not necessarily indicative of those to be expected for a full year, due, in part, to the seasonal fluctuations which are normal for the Company's business. The preparation of consolidated financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from these estimates. The accompanying interim financial statements and related notes should be read in conjunction with the consolidated financial statements of the Company and related notes as contained in the Annual Report on Form 10-K for the year ended May 31, 1998. 3. Earnings Per Share Effective December 1997, the Company adopted Statement of Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS 128"), which changes the method used to compute earnings per share. This Statement specifies the computation, presentation and disclosure requirements for earnings per share ("EPS") for entities with publicly held common stock. SFAS 128 replaces the presentation of primary EPS with a presentation of basic EPS, and for entities with a complex capital structure requires the additiona presentation of diluted EPS on the face of the income statement. Basic EPS is computed by dividing net income available to common stockholders by the weighted average number of shares outstanding during the period. The computation of diluted EPS is similar to the computation of basic EPS, except that the denominator is increased to include the number of additional common shares that would have been outstanding if any dilutive potential common shares had been issued. The adoption of this standard did not impact the Company's reported EPS, as no dilutive securities were outstanding during the periods presented, because all outstanding options were and are out of the money. Accordingly, for all periods presented, income or loss per common share was computed by dividing net income or net loss by the weighted average number of voting and non-voting shares outstanding during the year. 4. Cumulative Translation Adjustment The Company's principal operations are located primarily in Switzerland, Italy, Spain, Turkey and Russia. A significant part of net assets, revenues and expenses are denominated in the currency of those countries, while the Company presents its consolidated financial statements in US dollars. Assets and liabilities are translated at the exchange rates in effect at the balance sheet date. Revenues and expenses are translated at the weighted average exchange rates for the period. Net gains and losses arisin upon translation of local currency financial statements to US dollars are accumulated in a separate component of Stockholders' Equity, the Cumulative Translation Adjustment account. 5. Comprehensive Income In June 1997, the FASB issued Statement No. 130, Reporting Comprehensive Income ("SFAS 130"). This Statement establishes standards for reporting and display of comprehensive income and its components in the financial statements. This Statement is effective for financial statements for periods beginning after December 15, 1997, however interim period disclosure is limited to reporting a total for comprehensive income. The CompanyOs comprehensive income represents net income plus the change in the cumulativ translation adjustment equity account for the periods presented. The Company has determined total comprehensive income or (loss), net of tax, to be $1,627 and $486 for the three months ended November 30, 1998 and 1997, respectively, and $1,979 and ($2,470) for the six months ended November 30, 1998 and 1997, respectively. 6. Supplemental Disclosure of Cash Flow Information Six months ended November 30, 1998 1997 Cash paid during the year for: Interest $ 1,015 $ 582 Income taxes 1,059 1,418 During the period ended November 30, 1998, capital lease obligations of $96 were incurred when the Company entered into leases for new capital equipment. During the period ended November 30, 1998, in connection with the acquisition of Bewlay House, the Company incurred liabilities as described in Note 7. 7. Acquisition of Bewlay House In connection with the sale of UGUK, ULSA agreed to purchase from the latter the London building which houses most of UGUK's operations ("Bewlay House"). On July 8, 1998, the Company completed this transaction and acquired a 999-year leasehold in Bewlay House for a purchase price of $12,322. This consideration was paid by (i) the assumption of UGUK's existing debt of $10,812 with a bank and a finance institution; (ii) compensation of an intercompany account of $733; and (iii) $777 in cash. The company simultaneously entered into rental agreements with the tenants of the building. The bank facility was reduced by $2,388 to $6,966 at closing, has a three-yea maturity and is subject to quarterly repayments of $162. The financial institution's facility of $1,458 is subject to monthly repayments increasing from $19 presently to $32 in January 2003 when it matures. The Company is actively looking to sell the building. Upon such a sale, if and when it occurs, the Company intends to prepay the debts to the bank and finance institution. 8. Long-term Investments Focused Healthcare (Jersey) Limited As partial consideration for the Company's disposal of UGUK, the Company received non-voting, non-convertible, redeemable preferred shares of Focused Healthcare (Jersey) Limited ("FHL"), with a face value of $11,797. During the year ended May 31, 1998, the Company amortized $1,180 related to its investment in FHL, which reflects management's appraisal of the uncertainty as to the timing and the possibility of recovery of the investment. As of November 30, 1998, such preferred stock of FHL is recorded at $11,106 in the accompanying consolidated financial statements. The Company is of the opinion that no further write-downs are necessary at this time. Global Unilabs Clinical Trials Limited As of February 27, 1998, the Company spun off its then wholly-owned subsidiary Global Unilabs Clinical Trials Limited (OGUCTO) to its shareholders. During the three and six months periods ended November 30, 1997, GUCT had consolidated revenues of $2,837 and $5,652, respectively. The Company continues to hold non-voting, non-convertible, redeemable preferred stock of GUCT, with a face value of $20,000. As of November 30, 1998, such preferred stock of GUCT is recorded at $12,183 in the accompanying consolidated financial statements. The Company is of the opinion that no further write-downs are necessary at this time. 9. Segment Information During the year ended May 31, 1998, the Company performed testing in relation to clinical trials for the pharmaceutical industry and therefore distinguished its core clinical laboratory business (the "Diagnostic Laboratory Division") from its clinical trials testing business (the "Clinical Trials Division"). As of February 27, 1998, the Company's Clinical Trials Division was spun off to the Company's shareholders. Following are the key financial data of the Company for purposes of geographical information. Six Months Ended November 30, 1998 1997 Revenues from unaffiliated customers Switzerland $39,998 $26,761 United Kingdom - - Spain 3,923 3,274 Other 3,563 7,813 Operating Profit or Loss: Switzerland 5,772 3,922 United Kingdom (181) - Spain (352) (242) Other (912) (1,102) Identifiable Assets: Switzerland 74,594 55,338 United Kingdom 23,497 9,544 Spain 6,537 5,417 Other 21,423 5,992 Item 2. Management's Discussions and Analysis of Financial Condition and Results of Operations Results of Operations Three and six month periods ended November 30, 1998 compared with the three and six month periods ended November 30, 1997 Consolidated revenue was $26.9 million and $47.5 million for the three and six months ended November 30, 1998, representing respectively an increase of $8.8 million and $9.7 million (including the effect of the change in the US dollar exchange rate of $0.3 million) from the comparable prior year periods, as restated for the spin-off of the clinical trials operations. Revenue generated by the Swiss operations for the three and six months was up by 49% and 56% in local currency as a result of (i) a 1% increase in sales of the existing laboratories and (ii) the contribution made by the new operations acquired during fiscal 1998. The UK operations, disposed of in January 1998, generated sales of $5.2 million in the prior year six months period. The Spanish operations increased revenues to $3.9 million, as compared to $3.3 million in the comparable prior year six months period representing a 19% increase in local currency. Operating income for the three months ended November 30, 1998 was $3.7 million, versus $2.0 million in the comparable prior year three months period, and for the six months ended November 30, 1998 was $4.3 million, versus $2.6 million in the comparable prior year six months period, as restated for the spin-off of clinical trials operations. Such increase of $1.7 million was essentially due to the Swiss operations, which increased operating income by $1.8 million. Interest expense, net, increased $0.7 million during the six months ended November 30, 1998, as compared to the prior year, primarily due to higher average borrowing levels resulting from the Swiss acquisitions completed during fiscal 1998 and to the increase in UK debt as a result of the acquisition of the UK building. Provision for income taxes in the six months ended November 30, 1998, was $1.1 million, as compared to $0.9 million in the prior year comparable period. Minority interests in income in the six months ended November 30, 1998, were $1.5 million as compared to $0.9 million in the prior year comparable period, an increase resulting essentially from the increased profitability of the Swiss operations. Liquidity and Capital Resources Net cash provided by operating activities for the six months ended November 30, 1998 amounted to $7.1 million, a change of $5.1 million from the prior year primarily due to the increased profitability of Swiss operations and a change in working capital of $4.8 million. Net cash used in financing activities for the six months ended November 30, 1998 was $2.1 million, a decrease of $3.3 million from the prior period, primarily due to a net debt increase of $2.2 million, offset by a reduction in purchases of treasury stock of $1.5 million. Net cash used in investing activities for the six months ended November 30, 1998 was $8.4 million, comparing to net cash provided of $0.5 million in the prior year comparable period. The change is primarily due to increased cash capital expenditures incurred in connection with the acquisition of Bewlay House, and to the purchase of intangible assets. In connection with the sale of UGUK, ULSA agreed to purchase from UGUK the London building which houses most of UGUK's operations ("Bewlay House"). On July 8, 1998, the Company completed this transaction and acquired a 999-year leasehold in Bewlay House for a purchase price of $12.3 million. This consideration was paid by (i) the assumption of UGUK's existing debt of $10.8 million with a bank and a finance institution; (ii) compensation of an intercompany account of $0.7 million; and (iii) $0.8 million in cash. The company simultaneously entered into rental agreements with the tenants of the building. The bank facility reduced to $6.9 million after the closing, has a three-year maturity and is subject to quarterly repayments of $0.1 million. The financial institution's facility of $1.5 million is subject to monthly repayments up to January 2003 when it matures. The Company is actively seeking to sell the building. Upon such a sale, if and when it occurs, the Company intends to prepay the debts to the bank and finance institution. Accordingly, as of January 12, 1999, the Company's bank facilities provide for a total of approximately $59 million, including secured senior revolving facilities consisting of term loans, working capital loans and/or guarantees. As of January 12, 1999, the Company had approximately $10 million of availability under the aggregate credit facilities. The Company believes that the liquidity provided by the cash flow from operations, the existing cash balances and the borrowing arrangements described above will be sufficient to meet the Company's capital requirements including anticipated operating expenses arising from the Company's recent expansion into the Spanish and Italian markets, as well as debt repayments. In addition, the Company has outstanding obligations and commitments under capital leases which mature over the next five to ten years. IMPACT OF YEAR 2000 As previously reported in the Company's Form 10-K for the year ended May 31, 1998, most of the Company's laboratories are faced with "Year 2000" remediation issues. Many computer programs were written with a two digit date field and if these programs are not made Year 2000 compliant, they will be unable to correctly process date information on or after the Year 2000. While these issues impact all of the Company's data processing systems to some extent, they are most significant in connection with patient- related computer programs. Moreover, remediation efforts go beyond the Company's internal computer systems and require coordination with clients, suppliers and other third parties to assure that their systems and related interfaces are compliant. Given the different computer systems operated by the Company's business units, the type and extent of the Year 2000 issues and the cost of remediation vary significantly among the Company's laboratories. Failure to achieve timely remediation of computer systems that process client information and transactions, and of all other systems with embedded technologies that are critical to the Company's operations, would have a material adverse effect on the Company's business, operations and financial results. In response to the Year 2000 concerns, the Company created a Year 2000 Task Force to coordinate and monitor the laboratories' progress in their Year 2000 remediation efforts. The Task Force reports directly to the Company's executive management, provides regular progress reports to executive management, and regularly meets with executive management to discuss its reports. The Company's initial plans called for all critical systems to be renovated and compliance testing underway by the end of calendar 1998. As of January 11, 1999, the Company estimated that approximately 40 to 50% of its critical systems had been renovated and compliance testing underway, and that the balance will be renovated by June 30, 1999. As the Company uses many computerized laboratory machinery manufactured, provided and maintained by third-party vendors, it has requested each of those vendors to provide the Company with appropriate certification that the machinery is Year 2000 compliant. The Company currently estimates that approximately 40% of such certification has been received, and it continuously presses those vendors that have not responded. Acceptance testing is scheduled to take place through mid-1999 with time frames differing by laboratory unit. Completion of any third party interface testing is dependent upon those third parties completing their own internal remediation. The Company could be adversely affected to the extent third parties with which it interfaces (including some of the Company's customers) have not properly addressed their Year 2000 issues. The Company currently develops contingency plans to handle critical areas in the event remediation is not fully successful or is beyond the Company's control. In fiscal 1998, the Company spent approximately $0.5 million on its Year 2000 remediation efforts. The Company currently anticipates expenditures for Year 2000 remediation efforts and testing in the range of $0.5 million to $1.0 million in fiscal 1999, out of which approximately $0.3 million were spent in the six months ended November 30, 1998, and of approximately $0.2 million in fiscal 2000. Substantially all of the expenditures already made are related to internal payroll and external consultants, while future expenditures include approximately $0.5 for computer equipment that was not compliant and should be replaced. The costs of the project and the date on which the Company believes it will complete the Year 2000 modifications are based on management's best estimates, which were derived utilizing numerous assumptions of future events, including the continued availability of certain resources and other factors. However, there can be no guarantee that these estimates will be achieved and actual results could differ materially from those anticipated. CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Management's Discussion and Analysis contains various "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which represent the Company's expectations or beliefs concerning the Company's operations, economic performance and financial condition, including, in particular, forward-looking statements regarding the Company's expectation of future performance following implementation of its ne business strategy. Such statements are subject to various risks and uncertainties. Accordingly, the Company hereby identifies the following important factors that could cause the Company's actual financial results to differ materially from those projected, forecast, estimated, or budgeted by the Company in such forward-looking statements. (a) Inability to carry out marketing and sales plans. (b) Inability to recover the carrying value of the preferred stock in GUCT. (c) Inability to recover the carrying value of the preferred stock in FHL. As well as other factors listed in the Company's 1998 Annual Report on Form 10-K, which are incorporated herein by reference. PART II - OTHER INFORMATION Item 1. Legal Proceedings Arbitration As described and discussed more thoroughly in the Company's Annual Report on Form 10-K for the year ended May 31, 1998, the Company is entitled to 80% of the net recovery (less legal fees and costs) of any settlement or successful resolution of the pending arbitration instituted by Americanino Capital Corp. ("ACC") pursuant to an agreement by which the Company sold its remaining interest in ACC. The Company's management will continue to monitor and report the progress of the proceedings. See also the discussion on Foreclosure Proceedings and Attachment Claim in the 1998 Annual Report on Form 10-K. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits. 27 Financial Data Schedule (b) Reports on Form 8-K. None 12 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 hereunto duly authorized. UniHolding Corporation By: /s/ Bruno Adam Bruno Adam, CFO Date: January 13, 1999 EX-27 2 FDS UNIHOLDING CORPORATION
5 This schedule contains summary financial information extracted from this Consolidated Statement of Financial Condition at November 30, 1998 (Unaudited) and the Consolidated Statement of Income for the Six Months Ended November 30, 1998 (Unaudited) and is qualified in its entirety by reference to such financial statements. 1,000 6-mos May-31-1998 Sep-1-1998 Nov-30-1998 6,155 0 20,853 0 1,853 33,820 20,546 1,313 125,762 31,525 0 0 0 76 41,660 125,762 47,484 47,484 40,291 43,156 193 0 (1,047) 3,474 (1,124) 2,350 0 0 0 875 .14 .14
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