-----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, LR5WYnYH/CNf+PUELcHnDLCnvQ+My5Owane+xCurMqK+72ZPW50SgLfoA7oMOuxP duKjbUTMlqBKOPg8Mylr1g== 0000950148-96-000644.txt : 19960425 0000950148-96-000644.hdr.sgml : 19960425 ACCESSION NUMBER: 0000950148-96-000644 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960424 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: 96550247 BUSINESS ADDRESS: STREET 1: 5700 W 96TH ST CITY: LOS ANGELES STATE: CA ZIP: 90045 BUSINESS PHONE: 2137760180 10-Q 1 FORM 10-Q FOR THE QUARTERLY PERIOD ENDED 3/31/96 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 March 31, 1996 / / 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 March 31, 1996, was 13,539,336. ================================================================================ 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 March 31, ---------------------------- 1996 1995 -------- -------- SALES $ 43,246 $ 39,201 -------- -------- COSTS AND EXPENSES: Cost of sales 18,088 17,262 Selling 8,057 6,603 Research and development 4,384 3,870 General and administrative 4,649 4,142 Equity in income of affiliates (446) (320) Investment income (407) (311) -------- -------- Total costs and expenses 34,325 31,246 -------- -------- INCOME BEFORE INCOME TAXES 8,921 7,955 PROVISION FOR INCOME TAXES 2,420 2,150 -------- -------- NET INCOME $ 6,501 $ 5,805 ======== ======== NET INCOME PER SHARE $ .47 $ .42 WEIGHTED AVERAGE SHARES AND EQUIVALENTS OUTSTANDING 13,942 13,683
1 3 DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands) March 31, December 31, 1996 1995 ========== ----------- ASSETS (Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 12,411 $ 16,519 Accounts receivable - net of allowance for doubtful accounts of $88 and $77 43,724 40,802 Inventories 37,947 35,521 Prepaid expenses and other current assets 161 358 Deferred income taxes 3,451 3,451 --------- --------- Total current assets 97,694 96,651 PROPERTY, PLANT AND EQUIPMENT: Land and buildings 27,553 27,553 Machinery and equipment 40,421 38,607 Leasehold improvements 6,662 6,635 Construction in progress 496 836 --------- --------- Total 75,132 73,631 Less accumulated depreciation and amortization 32,911 31,707 --------- --------- Property, plant and equipment - net 42,221 41,924 SALES-TYPE AND OPERATING LEASES 18,210 18,128 DEFERRED INCOME TAXES 3,200 3,200 INVESTMENTS IN AFFILIATED COMPANIES 14,205 13,279 EXCESS OF COST OVER NET ASSETS ACQUIRED - Net of amortization of $5,619 and $5,373 15,979 16,280 --------- --------- TOTAL ASSETS $ 191,509 $ 189,462 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 13,716 $ 16,969 Accrued liabilities 6,075 5,708 Income taxes payable 3,926 3,435 --------- --------- Total current liabilities 23,717 26,112 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Common Stock - no par value, authorized 30,000,000 shares; outstanding 13,539,336 shares and 13,524,051 shares. 35,444 35,179 Retained earnings 136,013 131,136 Foreign currency translation adjustments (3,665) (2,965) --------- --------- Total shareholders' equity 167,792 163,350 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 191,509 $ 189,462 ========= =========
2 4 DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(Dollars in Thousands) Three Months Ended March 31, ------------------------- 1996 1995 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 6,501 $ 5,805 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 1,698 1,684 Equity in undistributed income of unconsolidated affiliates (445) 12 Accounts receivable (3,251) (5,307) Inventories (2,556) (1,875) Prepaid expenses and other current assets 197 294 Accounts payable (2,908) 324 Accrued liabilities 367 898 Income taxes payable 499 1,579 -------- -------- Net Cash Flows from Operating Activities 102 3,414 CASH FLOWS FROM (USED FOR) INVESTING ACTIVITIES: Additions to property, plant and equipment (1,964) (1,936) Sales-type and operating leases (276) (1,292) Investment in affiliated company (481) -------- -------- Net Cash from (used for) Investing Activities (2,721) (3,228) CASH FLOWS FROM (USED FOR) FINANCING ACTIVITIES: Proceeds from exercise of stock options 265 1,552 Cash dividends paid (1,624) (1,297) -------- -------- Net Cash from (used for) Financing Activities (1,359) 255 EFFECT OF EXCHANGE RATE CHANGES ON CASH (130) 1,215 -------- -------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (4,108) 1,656 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 16,519 14,833 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 12,411 $ 16,489 ======== ========
3 5 DIAGNOSTIC PRODUCTS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) NOTE 1 -- BASIS OF PRESENTATION The information for the three months ended March 31, 1996 and 1995 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 1995 annual report on Form 10-K as filed with the Securities and Exchange Commission. The results of operations for the three-month period ending March 31, 1996 are not necessarily indicative of the results to be expected for the year ended December 31, 1996. Net income per share has been computed using the weighted-average number of common shares and common share equivalents outstanding during each period. Common share equivalents represent the dilutive effect of outstanding stock options. NOTE 2 -- INVENTORIES Inventories by major categories are summarized as follows:
March 31, December 31, 1996 1995 ----------- ----------- Raw materials $12,094,000 $11,414,000 Work in process 15,807,000 14,567,000 Finished goods 10,046,000 9,540,000 ----------- ----------- Total $37,947,000 $35,521,000 =========== ===========
4 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Record sales of $43.2 million were achieved in the first quarter of 1996, a 10% increase over the first quarter 1995. 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 strengthening, the effect of translation of the financial statements of the consolidated foreign affiliates is that of lower sales, costs and net income. The stronger U.S. dollar in the first quarter 1996 when compared to the first quarter 1995 resulted in lowered reported sales of approximately 1% and had a negligible effect on net income. Cost of sales as a percentage of sales was 42% as compared to 44% in the corresponding 1995 quarter. The 1996 results continue the improvement trend set in the 1995 fourth quarter principally resulting from increased utilization at the Wales manufacturing facility and at the New Jersey IMMULITE instrument manufacturing facility. Selling expenditures increased 22% in the 1996 quarter compared to the 1995 quarter representing 19% of sales in 1996 and 17% of sales in 1995. These increased costs are a result of the continual expansion of the marketing and sales effort, especially for the IMMULITE system. Research and development expenditures increased 13% in 1996 over 1995. These expenditures have increased to support the IMMULITE system. General and administrative costs were about 11% of sales in both 1996 and 1995. Included in general and administrative expenses is the amortization of the excess of cost over net assets acquired. Equity in income of affiliates, which increased 39% in the 1996 first quarter compared to the 1995 quarter, represents the Company's share of earnings of nonconsolidated affiliates, principally the 45%-owned Italian affiliate. Profitability in Italy which in prior quarters had declined was modestly higher in the 1996 quarter when compared to 1995. The other affiliates reported increases in their first quarter net income. The Company's effective tax rate includes Federal, state and foreign taxes. The 1996 rate of 27% approximates the 1995 rate of 27%. 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 $102,000 in the first quarter 1996 compared to $3.4 million in the 1995 quarter. Cash flow in the 1996 quarter was primarily used for increases in accounts receivables and inventories and reduction of accounts payable. During 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. 5 7 PART II. OTHER INFORMATION 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) APRIL 24, 1996 SIGI ZIERING - ---------------------------------------------- ------------------------------------------ Date Sigi Ziering, Ph.D., Chairman of the Board Chief Executive Officer APRIL 24, 1996 JULIAN R. BOCKSERMAN - ---------------------------------------------- ------------------------------------------ Date Julian R. Bockserman, Vice President Chief Financial Officer
6 EX-27 2 ARTICLE 5 - FINANCIAL DATA SCHEDULE
5 1000 3-MOS DEC-31-1996 JAN-01-1996 MAR-31-1996 12,411 0 43,724 88 37,947 97,694 75,132 32,911 191,509 23,717 0 0 0 35,444 136,013 191,509 43,246 43,246 18,088 18,088 16,237 0 0 8,921 2,420 6,501 0 0 0 6,501 .47 0
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