-----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, LFuTNOVAv/S/Il7CPx6RqW5eArxF+arjD3YmLmz4/Yy3214eDns129bpX5YCRCbj 4xenzTfBgR0FcZTYbkOeTA== 0000910680-97-000219.txt : 19970811 0000910680-97-000219.hdr.sgml : 19970811 ACCESSION NUMBER: 0000910680-97-000219 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970808 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN MEDICAL ALERT CORP CENTRAL INDEX KEY: 0000700721 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS BUSINESS SERVICES [7380] IRS NUMBER: 112571221 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 001-08635 FILM NUMBER: 97654070 BUSINESS ADDRESS: STREET 1: 3265 LAWSON BLVD CITY: OCEANSIDE STATE: NY ZIP: 11572 BUSINESS PHONE: 5165365850 MAIL ADDRESS: STREET 1: 3265 LAWSON BLVD CITY: OCEANSIDE STATE: NY ZIP: 11572 10QSB 1 FOR QUARTER ENDED JUNE 30, 1997 FORM 10-QSB 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 June 30, 1997 Commission File Number 1-8635 AMERICAN MEDICAL ALERT CORP. (Exact Name of Small Business Issuer as Specified in its Charter) New York 11-2571221 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 3265 Lawson Boulevard, Oceanside, New York 11572 (Address of principal executive offices) (Zip Code) (516) 536-5850 (Issuer's telephone number, including area code) Check whether the issuer (1) 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 [_] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 5,896,720 shares of $.01 par value common stock as of August 1, 1997. AMERICAN MEDICAL ALERT CORP. INDEX PART I FINANCIAL INFORMATION PAGE Item 1. Financial Statements. Condensed Balance Sheets for June 30, 1997 and December 31, 1996 1 Condensed Statements of Income for the Six Months Ended June 30, 1997 and 1996 2 Condensed Statements of Income for the Three Months Ended June 30, 1997 and 1996 3 Condensed Statements of Cash Flows for the Six Months Ended June 30, 1997 and 1996 4 Notes to Condensed Financial Statements 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 6 PART II OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security-Holders. 7 Item 6. Exhibits and Reports on Form 8-K. 9 Item 1. Financial Statements. AMERICAN MEDICAL ALERT CORP. CONDENSED BALANCE SHEETS
ASSETS June 30, 1997 Dec.,31,1996* (UNAUDITED ----------- ----------- CURRENT ASSETS: Cash $ 231,320 $ 301,013 Accounts and notes receivable (net of allowance for doubtful accounts of $30,000 in each of '97 & '96) 1,532,267 1,327,799 Inventory 1,170,278 1,171,021 Prepaid expenses and other current assets 308,754 137,247 Deferred income tax benefit 54,000 54,000 ----------- ----------- Total Current Assets 3,296,619 2,991,080 ----------- ----------- Inventory of medical devices held for lease at cost 547,000 637,000 ----------- ----------- Note receivable -0- 15,956 ----------- ----------- FIXED ASSETS: (Net of accumulated depreciation and amortization) 3,226,877 3,115,110 OTHER ASSETS 25,692 24,868 ----------- ----------- TOTAL ASSETS $ 7,096,188 $ 6,784,014 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Note Payable Bank $ 450,000 $ -0- Accounts payable 186,505 192,707 Accrued expenses 171,182 311,954 Taxes payable -0- 16,464 Current portion of long-term debt 9,332 9,182 ----------- ----------- Total Current Liabilities 817,019 530,307 DEFERRED INCOME TAX LIABILITY 258,000 258,000 NOTE PAYABLE BANK -0- 450,000 LONG-TERM DEBT-LESS CURRENT MATURITIES 7,244 11,849 ----------- ----------- Total Liabilities 1,082,263 1,250,156 ----------- ----------- COMMITMENTS AND CONTINGENT LIABILITIES SHAREHOLDERS' EQUITY Preferred stock - $.01 par value; -0- -0- authorized - 1,000,000 shares - none issued and outstanding Common stock - $.01 par value; 58,878 58,432 authorized - 10,000,000 shares; issued and outstanding - 5,887,752 shares in 1997 and 5,843,276 shares in 1996 Additional paid-in capital 4,483,484 4,391,990 Retained Earnings 1,577,595 1,189,468 ----------- ----------- 6,119,957 5,639,890 Less 43,910 shares in 1997 & 1,995 in 1996 of (106,032) (106,032) treasury stock, at cost ----------- ----------- Total Shareholders Equity 6,013,925 5,533,858 ----------- ----------- TOTAL LIABILITIES & SHAREHOLDERS EQUITY $ 7,096,188 $ 6,784,014 =========== ===========
See accompanying notes to condensed financial statements. * Derived from audited financial statements 1 AMERICAN MEDICAL ALERT CORP. CONDENSED STATEMENTS OF INCOME (Unaudited) Six Months Ended June 30, 1997 1996 ----------- ----------- Revenues: Services $ 3,284,793 $ 3,014,028 Product Sales 291,893 508,988 ----------- ----------- 3,576,686 3,523,016 ----------- ----------- Cost and Expenses (Income): Costs related to services (Note 4) 1,233,608 1,012,304 Costs of products sold (Note 4) 270,419 347,046 Selling, general and administrative expenses 1,355,578 1,251,171 Interest expense 23,934 25,236 Other income (680) (1,000) ----------- ----------- 2,882,859 2,634,757 ----------- ----------- Income before provision for income taxes 693,827 888,259 Provision for income taxes 305,700 391,000 ----------- ----------- NET INCOME $ 388,127 $ 497,259 ----------- ----------- Net income per share $ .07 $ .09 =========== =========== Weighted average number of common shares outstanding (Note 3) 5,918,128 5,765,456 =========== =========== See accompanying notes to condensed financial statements 2 AMERICAN MEDICAL ALERT CORP. CONDENSED STATEMENTS OF INCOME (Unaudited) Three Months Ended June 30, --------------------------- 1997 1996 ----------- ----------- Revenues: Services $ 1,669,028 $ 1,534,772 Product Sales 177,318 337,098 ----------- ----------- 1,846,346 1,871,870 Cost and Expenses (Income): Cost related to services (Note 4) 642,316 537,591 Costs of products sold (Note 4) 163,020 236,595 Selling, general and administrative expenses 650,759 605,375 Interest expense 11,104 10,125 Other Income (334) (1,000) ----------- ----------- 1,466,865 1,388,686 ----------- ----------- Income before provisions for income taxes 379,481 483,184 Provision for income taxes 166,700 213,000 ----------- ----------- NET INCOME $ 212,781 $ 270,184 =========== =========== Net income per share $ .04 $ .05 =========== =========== Weighted average number of common shares outstanding (Note 3) 5,936,156 $ 5,788,124 =========== =========== See accompanying notes to condensed financial statements 3 AMERICAN MEDICAL ALERT CORP. CONDENSED STATEMENT OF CASH FLOWS (Unaudited) Six Months Ended June 30, ------------------------- 1997 1996 --------- --------- Cash Flows From Operating Activities: Net Income $ 388,127 $ 497,259 Adjustments to reconcile net income to net cash provided by operating activities Provision for deferred income taxes 24,000 Depreciation and amortization 357,580 308,102 Change in Assets and Liabilities: (Increase) Decrease in receivables (204,468) (106,294) (Increase) Decrease in inventory 90,743 (188,767) (Increase) in prepaid expenses and other assets (156,375) (42,543) Increase (Decrease) in accounts payable, accrued expenses and taxes payable (163,438) 71,444 --------- --------- Net Cash Provided by Operating Activities 312,169 563,201 --------- --------- Cash Flows from Investing Activities: Expenditures for fixed assets (469,347) (500,349) --------- --------- Net Cash Used In Investing Activities (469,347) (500,349) --------- --------- Cash Flows from Financing Activities: Repayment of bank borrowing - 0 - (150,000) Net (Repayment of) loans payable (4,455) 10,654 Net Proceeds upon exercise of stock options 91,940 7,536 --------- --------- Net Cash Provided (Used) in Financing Activities 87,485 (131,810) --------- --------- Net (Decrease) increase in Cash (69,693) (68,958) Cash, Beginning of Period 301,013 319,989 --------- --------- Cash, End of Period $ 231,320 $ 251,031 ========= ========= SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: CASH PAID DURING THE PERIOD FOR INTEREST $ 23,934 $ 25,236 ========= ========= CASH PAID DURING THE PERIOD FOR INCOME TAXES $ 390,177 $ 207,129 ========= ========= See accompanying notes to condensed financial statements 4 AMERICAN MEDICAL ALERT CORP. Notes to Condensed Financial Statements (Unaudited) 1. General: These financial statements should be read in conjunction with the notes to the financial statements contained in the latest annual report on Form 10-KSB for the year ended December 31, 1996. 2. Results of Operations: In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments (consisting only of normal recurring accruals) necessary to present fairly the financial position as of June 30, 1997, the condensed statements of income for the three and six month periods ended June 30, 1997 and 1996, and the statements of cash flows for the six months ended June 30, 1997 and 1996. These financial statements should be read in conjunction with the financial statements and notes thereto for the year ended December 31, 1996 included in the Company's Annual Report on Form 10-KSB. The accounting policies used in preparing these financial statements are consistent with those applied in the December 31, 1996 financial statements. 3. Income Per Share: In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings per Share" which changes the methodology of calculating earnings per share. SFAS No. 128 requires the disclosure of diluted earnings per share regardless of its difference from basic earnings per share. The company plans to adopt SFAS No. 128 in December 1997. Early adoption is not permitted. Had the company adopted SFAS No. 128 as of June 30, 1997, the related per share disclosure for both basic and diluted earnings per share would have been: Three Months Ended June 30 Six Months Ended June 30 -------------------------- ------------------------ Basic Diluted Basic Diluted ----- ------- ----- ------- 1997 .04 .04 .07 .07 ======= ======= ======= ======= 1996 .05 .05 .10 .09 ======= ======= ======= ======= 5 AMERICAN MEDICAL ALERT CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (for the Six Months Ended June 30, 1997) The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of the Company's results of operations and financial condition. The discussion should be read in conjunction with the consolidated financial statements contained in the latest Annual Report on Form 10-KSB dated December 31, 1996. Liquidity and Capital Resources - ------------------------------- On March 27, 1997, the Company renegotiated its $ 1,500,000 credit note (based upon 75% of eligible accounts receivable and 25% of inventory, as defined) and extended it until April 30, 1998. As of July 28, 1997, $ 350,000 was outstanding under this note. The Company's working capital on June 30, 1997 was $ 2,451,315. During 1997 the Company anticipates that it will make capital investments of approximately $ 1,000,000 of which approximately $ 470,000 has been expended through June 30, 1997 for the purchase and production of additional systems which the Company intends to rent. The Company believes that its present cash and working capital position, its borrowing availability and future anticipated income will be sufficient to meet its cash and working capital needs for the foreseeable future. Results of Operations - --------------------- Revenue from services increased $ 270,765 for the six months ended June 30, 1997 as compared to the same period in 1996, an increase of 9%. This increase resulted from the expansion of the Company's customer base for monthly monitoring and leasing services. Costs related to services for the six months ended June 30, 1997 and 1996 were 38% and 34% respectively. Revenue from services increased $ 134,256 for the three months ended June 30, 1997 as compared to the same period in 1996, an increase of 9%. This increase resulted from the expansion of the Company's customer base for monthly monitoring and leasing services. Costs related to services for the three months ended June 30, 1997 and 1996 were 38% and 35% respectively. Revenue from product sales decreased $ 217,095 for the six months ended June 30, 1997 as compared to the same period in 1996, a decrease of 43%. This decrease was primarily due to the rescheduling of sales to retirement communities and assisted living facilities. The gross profit on product sales for the six months ended June 30, 1997 and 1996 was 7% and 32% respectively. Revenue from product sales decreased $ 159,780 for the three months ended June 30, 1997 as compared to the same period in 1996, a decrease of 47%. This decrease was primarily due to the rescheduling in sales to retirement communities and assisted living facilities. The gross profit on product sales for the three months ended June 30, 1997 and 1996 was 8% and 30% respectively. This decline was attributable to increased fixed production costs and sales concessions made to a major new customer. 6 As a result of these concessions, a contract to purchase significant quantities of new product was achieved. Interest expense for the six months ended June 30, 1997 and 1996 was $ 23,934 and $ 25,236 respectively. Selling, general and administrative expenses as compared as a percentage of total revenues for the six months ended June 30, 1997 and 1996 were 38% and 36% respectively. Interest expense for the three months ended June 30, 1997 and 1996 was $ 11,104 and $10,125 respectively. Selling, general and administrative expenses as compared as a percentage of total revenues for the three months ended June 30, 1997 and 1996 were 35% and 32% respectively. PART II. - OTHER INFORMATION Item 4. Submission of matters to a Vote of Security Holders. On June 11, 1997, the Company held its 1997 Annual Meeting of Shareholders (the "1997 Meeting"). At the 1997 Meeting, the Company's shareholders elected five directors to serve until the 1998 Annual Meeting of Shareholders and until their respective successors shall be elected and qualified. The vote for such directors was as follows: FOR WITHHELD --- -------- Howard M. Siegel 4,981,207 57,087 Myron Segal 4,981,107 57,187 Leonard Herz 4,981,207 57,087 Peter Breitstone 4,981,207 57,087 Eli S. Feldman 4,981,207 57,087 The proposal to amend the Corporation's Certificate of Incorporation to increase the total number of shares of capital stock which the Corporation has authority to issue from 10,000,000 to 11,000,000 and to create a class of stock designated as preferred stock with a par value of $ .01 per share which would consist of 1,000,000 shares, received the affirmative vote of a majority of the shares issued, outstanding and entitled to vote thereon. The proposal authorizing that 750,000 shares of the Corporation's Common Stock be reserved for the issuance upon the exercise of options being granted under the American Medical Alert 1997 Stock Option Plan was approved. The Company's shareholders voted with respect to the ratification and approval of Margolin, Winer & Evens, LLP as the Company's independent auditors for the year ending December 31, 1997. Approximately 98% of the votes cast with respect to the ratification and approval voted in favor of the proposal and accordingly, the proposal was approved. 7 Item 6. Exhibit and Reports on Form 8-K. (a) Exhibits: 27. Financial Data Schedule (b) Reports on Form 8-K: No reports on Form 8-K were filed. 8 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. AMERICAN MEDICAL ALERT CORP. By: /s/ Howard M. Siegel Dated: August 7, 1997 ----------------------------------- Howard M. Siegel President & Chief Operating Officer By: /s/ Corey M. Aronin ----------------------------------- Corey M. Aronin Chief Financial Officer 9 EX-27 2 FDS -- FOR QUARTER ENDED JUNE 30, 1997
5 AMERICAN MEDICAL ALERT CORP. 0000700721 6-MOS DEC-31-1997 JAN-01-1997 JUN-30-1997 231,320 0 1,562,267 30,000 1,717,278 3,296,619 3,226,877 0 7,096,188 817,019 466,576 0 0 58,878 5,955,047 7,096,188 291,893 3,576,686 270,419 2,882,859 0 0 23,934 693,827 305,700 0 0 0 0 388,127 .07 0
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