-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, RFlLOQ2i6xRNlXG/5yCLY3HZqHo7MsGb+DLb9kvLO5iOZ5jqxudQPE5w6rvnSkoj jtccSrISpjyg+HCddHAHgA== 0000950148-95-000426.txt : 19950728 0000950148-95-000426.hdr.sgml : 19950728 ACCESSION NUMBER: 0000950148-95-000426 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950727 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DIAGNOSTIC PRODUCTS CORP CENTRAL INDEX KEY: 0000702259 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 952802182 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09957 FILM NUMBER: 95556429 BUSINESS ADDRESS: STREET 1: 5700 W 96TH ST CITY: LOS ANGELES STATE: CA ZIP: 90045 BUSINESS PHONE: 2137760180 10-Q 1 FORM 10-Q 1 ================================================================================ 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 June 30, 1995 [ ] 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 1-9957 Diagnostic Products Corporation (Exact name of registrant as specified in its charter) CALIFORNIA 95-2802182 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.)
5700 WEST 96TH STREET LOS ANGELES, CALIFORNIA 90045 (Address of principal executive offices) Registrant's telephone number: (213) 776-0180 NO CHANGE (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 ] The number of shares of Common Stock, no par value, outstanding as of June 30, 1995, was 13,103,065. ================================================================================ 2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS. DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, ----------------------- --------------------- 1995 1994 1995 1994 ------- ------- ------- ------- SALES $38,534 $30,132 $77,735 $57,905 ------- ------- ------- ------- COSTS AND EXPENSES: Cost of sales 16,971 13,266 34,233 25,083 Selling 6,803 5,635 13,406 11,221 Research and development 4,077 3,163 7,947 6,453 General and administrative 3,172 3,285 7,314 6,290 Equity in income of affiliates (295) (465) (615) (924) Investment income (359) (52) (670) (206) ------- ------- ------- ------- Total costs and expenses 30,369 24,832 61,615 47,917 ------- ------- ------- ------- INCOME BEFORE INCOME TAXES 8,165 5,300 16,120 9,988 PROVISION FOR INCOME TAXES 2,060 1,400 4,210 2,620 ------- ------- ------- ------- NET INCOME $ 6,105 $ 3,900 $11,910 $ 7,368 ======= ======= ======= ======= NET INCOME PER SHARE OF COMMON STOCK: Primary $ .44 $ .29 $ .86 $ .55 Fully Diluted .42 .28 .83 .53 AVERAGE COMMON SHARES OUTSTANDING: Primary 13,986 13,403 13,834 13,466 Fully Diluted 14,387 13,844 14,340 13,867
1 3 DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in Thousands)
June 30, December 31, 1995 1994 ----------- ------------ ASSETS (Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 16,310 $ 14,833 Accounts receivable - net of allowance for doubtful accounts of $90 and $76 38,630 32,076 Inventories 32,649 28,324 Prepaid expenses and other current assets 826 983 Deferred income tax benefit 2,123 2,123 -------- -------- Total current assets 90,538 78,339 PROPERTY, PLANT AND EQUIPMENT: Land and buildings 27,150 26,224 Machinery and equipment 34,051 31,040 Leasehold improvements 6,179 6,175 Construction in progress 1,825 162 -------- -------- Total 69,205 63,601 Less accumulated depreciation and amortization 29,247 26,337 -------- -------- Property, plant and equipment - net 39,958 37,264 SALES-TYPE AND OPERATING LEASES 11,331 8,005 DEFERRED INCOME TAXES 2,537 2,537 INVESTMENTS IN AFFILIATED COMPANIES 12,748 12,775 EXCESS OF COST OVER NET ASSETS ACQUIRED - Net of amortization of $4,897 and $4,453 13,371 13,815 -------- -------- TOTAL ASSETS $170,483 $152,735 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 13,347 $ 11,667 Accrued liabilities 3,669 5,124 Income taxes payable 3,795 844 -------- -------- Total current liabilities 20,811 17,635 SHAREHOLDERS' EQUITY: Common Stock - no par value, authorized 30,000,000 shares; outstanding 13,103,065 shares and 12,952,880 shares. 29,909 27,334 Retained earnings 122,086 113,041 Foreign currency translation adjustments (2,323) (5,275) -------- -------- Total shareholders' equity 149,672 135,100 -------- -------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $170,483 $152,735 ======== ========
2 4 DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(Dollars in Thousands) Six Months Ended June 30, ----------------------- 1995 1994 ------- ------- CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $11,910 $ 7,368 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 2,683 2,584 Equity in undistributed income of unconsolidated affiliates 27 (145) Accounts receivable (5,405) (4,109) Inventories (3,938) 1,449 Prepaid expenses and other current assets 157 (10) Accounts payable 500 (176) Accrued liabilities (1,455) (730) Income taxes payable 2,930 (662) ------- ------- Net Cash Flows from Operating Activities 7,409 5,569 CASH FLOWS FROM (USED FOR) INVESTING ACTIVITIES: Additions to property, plant and equipment (3,892) (2,239) Sales-type and operating leases (2,650) (2,412) ------- ------- Net Cash from (used for) Investing Activities (6,542) (4,651) CASH FLOWS FROM (USED FOR) FINANCING ACTIVITIES: Borrowing under credit agreement 3,000 Proceeds from exercise of stock options 2,575 114 Cash dividends paid (2,865) (2,607) Repurchase of common stock (2,429) ------- ------- Net Cash from (used for) Financing Activities (290) (1,922) EFFECT OF EXCHANGE RATE CHANGES ON CASH 900 179 ------- ------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 1,477 (825) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 14,833 12,884 ------- ------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $16,310 $12,059 ======= =======
3 5 DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) NOTE 1 -- BASIS OF PRESENTATION The information for the six months ended June 30, 1995 and 1994 has not been audited by independent accountants, but includes all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for such periods. Certain information and footnote disclosure normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to the requirements of the Securities and Exchange Commission, although the Company believes that the disclosures included in these financial statements are adequate to make the information not misleading. The consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's 1994 annual report on Form 10-K as filed with the Securities and Exchange Commission. The results of operations for the six-month period ending June 30, 1995 are not necessarily indicative of the results to be expected for the year ended December 31, 1995. Net income per share - primary is based upon the weighted average number of common shares outstanding, including stock options when dilutive. Net income per share - fully diluted is based upon the weighted average number of common shares outstanding and the assumed exercise of all dilutive stock options, including the effect of contingent options. NOTE 2 -- INVENTORIES Inventories by major categories are summarized as follows:
June 30, December 31, 1995 1994 ----------- ------------ Raw materials $10,651,000 $ 9,259,000 Work in process 13,444,000 11,233,000 Finished goods 8,554,000 7,832,000 ----------- ----------- Total $32,649,000 $28,324,000 =========== ===========
4 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Sales of $38.5 million were achieved in the second quarter 1995, a 28% increase over the second quarter 1994. Sales for the six months were a record $77.8 million, a 34% increase over 1994. The sales increases are principally a result of the continuing increased worldwide acceptance of the fully automated, random access IMMULITE system. The system is expected to account for the greatest amount of growth of all the Company's product lines for the foreseeable future. In periods when the U.S. dollar is weakening, the effect of translation of the financial statements of the consolidated foreign affiliates is that of higher sales, costs and net income. The weaker U.S. dollar in the second quarter 1995 when compared to the second quarter 1994 resulted in increased sales of approximately 7% and increased net income of approximately 3%. For the six month period the weaker 1995 U.S. dollar resulted in increased sales of approximately 7% and increased net income of approximately 4%. Cost of sales as a percentage of sales in the 1995 second quarter and six months was 44% compared to 44% and 43% in the corresponding 1994 periods. The 44% in 1995 was an improvement from the 46% reported in the fourth quarter 1994 principally resulting from increased utilization at the Wales manufacturing facility and at the New Jersey IMMULITE instrument manufacturing facility. Selling expenditures increased approximately 20% in the 1995 second quarter and six months compared to 1994 representing 17% of sales in 1995 and 19% of sales in 1994. These increased costs are a result of the continued expansion of the marketing and sales effort, especially for the IMMULITE system. Research and development expenditures increased 29% in the 1995 second quarter and 23% in the 1995 six months over the corresponding periods of the prior year. These expenditures have increased to support the IMMULITE system. General and administrative costs were approximately 8% and 9% of sales in the 1995 periods compared to 11% of sales in the 1994 periods. Included in general and administrative expenses is the amortization of the excess of cost over net assets acquired. Equity in income of affiliates, which decreased 37% in the 1995 second quarter and decreased 33% in the 1995 six months when compared to the 1994 periods, represents the Company's share of earnings of nonconsolidated affiliates, principally the 45%-owned Italian affiliate. Profitability in Italy continued to be adversely effected by reduced sales caused by the current serious economic problems and reductions in health care cost reimbursements. The Company's effective tax rate includes Federal, state and foreign taxes. The 1995 rate of 26% approximates the 1994 rate of 26%. The Company has adequate working capital and sources of capital to carry on its current business and to meet its existing capital requirements. Cash flow from operating activities was $7.4 million in 1995 compared to $5.6 million in 1994. During 1994 and the first quarter of 1995, the Company paid a quarterly cash dividend of $.10 per share. Commencing with the second quarter of 1995, the quarterly dividend was increased to $.12 per share. In March 1994, the Company repurchased 129,200 shares of its Common Stock in the open market at a cost of $2,429,000. 5 7 PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The Company's Annual Meeting of Shareholders was held on May 3, 1995. The only matter voted on was the election of directors. Each nominee received the following votes:
Nominee For Withheld - --------------------------------------------------- Sigi Ziering 10,927,744 27,137 Sidney A. Aroesty 10,929,744 25,137 Marilyn Ziering 10,929,594 25,287 Joseph Kleiman 10,929,744 25,137 Maxwell H. Salter 10,929,744 25,137 James D. Watson 10,930,094 24,787 Michael Ziering 10,928,144 26,737
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits 27 Financial Data Schedule (b) Reports on Form 8-K. None 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. DIAGNOSTIC PRODUCTS CORPORATION (Registrant) JULY 27, 1995 SIGI ZIERING - --------------------------------------------- --------------------------------------------- Date Sigi Ziering, Ph.D., Chairman of the Board Chief Executive Officer JULY 27, 1995 JULIAN R. BOCKSERMAN - --------------------------------------------- --------------------------------------------- Date Julian R. Bockserman, Vice President Chief Financial Officer
6 EX-27 2 EXHIBIT 27/FDS
5 1,000 U.S. DOLLARS 6-MOS DEC-31-1995 JUN-30-1995 1 16,310 0 38,630 90 32,649 90,538 69,205 29,247 170,483 20,811 0 29,909 0 0 122,086 170,483 77,735 77,735 34,233 34,233 27,382 0 0 16,120 4,210 11,910 0 0 0 11,910 .86 .83
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