-----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, KnqW+mfk5VXXk+Bubqm5A9th1Pb+jDKOA2GLX3Hqb5RqygOH1FZv8zNU9KW1bGIj TiKAHzdwvuQNJwONIJoGyg== 0000073290-97-000007.txt : 19970415 0000073290-97-000007.hdr.sgml : 19970415 ACCESSION NUMBER: 0000073290-97-000007 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970228 FILED AS OF DATE: 19970414 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: BIOMERICA INC CENTRAL INDEX KEY: 0000073290 STANDARD INDUSTRIAL CLASSIFICATION: DENTAL EQUIPMENT & SUPPLIES [3843] IRS NUMBER: 952645573 STATE OF INCORPORATION: DE FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-08765 FILM NUMBER: 97579607 BUSINESS ADDRESS: STREET 1: 1533 MONROVIA AVENUE CITY: NEWPORT BEACH STATE: CA ZIP: 92663 BUSINESS PHONE: 714-645-2111 MAIL ADDRESS: STREET 1: 1533 MONROVIA AVENUE CITY: NEWPORT BEACH STATE: CA ZIP: 92663 FORMER COMPANY: FORMER CONFORMED NAME: NMS PHARMACEUTICALS INC DATE OF NAME CHANGE: 19871130 FORMER COMPANY: FORMER CONFORMED NAME: NUCLEAR MEDICAL SYSTEMS INC DATE OF NAME CHANGE: 19830216 FORMER COMPANY: FORMER CONFORMED NAME: NUCLEAR INSTRUMENTS INC DATE OF NAME CHANGE: 19720508 10QSB 1 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 February 28, 1997 Commission File No. 0-8765 ----------------- ------ BIOMERICA, INC. - ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 95-2645573 - ------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1533 Monrovia Avenue, Newport Beach, California 92663 - ------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number including area code: (714) 645-2111 - ------------------------------------------------------------------------------- (Not applicable) - ------------------------------------------------------------------------------- (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 --------- --------- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 3,882,902 shares of common Stock as of April 14, 1997. BIOMERICA, INC. INDEX PART I Financial Statements: Statements of Operations - Nine Months and Three Months Ended February 28, 1997 and February 29, 1996 ......................2 Balance Sheet - February 28, 1997 .............................3 & 4 Statements of Cash Flows Nine Months Ended February 28, 1997 and February 29, 1996 ..........5 Statements of Changes in Shareholders' Equity - Nine Months Ended February 28, 1997 ................................6 Notes to Financial Statements ......................................7 Management's Discussion and Analysis of Financial Condition and Selected Financial Data ....................................8 & 9 PART II Other Information .................................................10 Signatures ........................................................10 PART I - FINANCIAL INFORMATION SUMMARIZED FINANCIAL INFORMATION BIOMERICA, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
Nine Months Ended Three Months Ended February February 1997 1996 1997 1996 ------------ -------------- ------------- ------------- Net Sales............................... $ 6,856,378 $ 6,668,909 $ 2,303,353 $ 2,066,334 Cost of sales ......................... 4,015,712 3,783,121 1,419,736 1,302,359 ------------ -------------- ------------- ------------- Gross profit .......................... 2,840,666 2,885,788 883,617 763,975 ------------ -------------- ------------- ------------- Operating Expenses: Selling, general and administrative ... 2,266,394 2,347,990 715,307 690,480 Research and development .............. 196,952 209,666 71,957 60,784 ------------ -------------- ------------- ------------- 2,463,346 2,557,656 787,264 751,264 ------------ -------------- ------------- ------------- Other Expense (income): Interest expense ...................... 45,227 75,701 13,348 18,554 Other (income), net ................... (46,774) (31,739) (21,195) (4,051) ------------ -------------- ------------- ------------- Income (loss) before minority interest in net profits of consoli- dated subsidiaries and income taxes... 378,867 284,170 104,200 (1,792) Minority interest in net (profits) losses of consolidated subsidiaries ... (19,250) (56,148) 6,685 71,922 ------------ -------------- ------------- ------------- Income before taxes ................... 359,617 228,022 110,885 70,130 Income taxes .......................... 28,875 2,400 11,028 0 ------------ -------------- ------------- -------------- NET INCOME ........................... $ 330,742 $ 225,622 $ 99,857 $ 70,130 ------------ -------------- ------------- -------------- ------------ -------------- ------------- -------------- Net income per share.................... $ .09 $ .07 $ .03 $ .02 ------------ -------------- ------------- -------------- ------------ -------------- ------------- -------------- Weighted average shares outstanding .................... 3,608,299 3,445,861 3,771,624 3,455,569 The accompanying notes are an integral part of these statements.
BIOMERICA, INC. CONSOLIDATED BALANCE SHEET
February 28, 1997 -------------- Assets Current Assets Cash and cash equivalents .......................................... $ 1,886,482 Available for-sale securities ...................................... 343,112 Accounts receivable, less allowance for doubtful accounts .......... 1,891,535 Inventory .......................................................... 2,263,693 Notes receivable ................................................... 7,985 Prepaid expenses and other ......................................... 63,809 -------------- Total Current Assets............................................. 6,456,616 Inventory, non-current................................................. 37,000 Land held for investment............................................... 46,000 Property and Equipment, less accumulated depreciation and amortization. 427,170 Intangible assets, net of accumulated amortization..................... 509,197 Other Assets........................................................... 9,796 -------------- $ 7,485,779 -------------- -------------- The accompanying notes are an integral part of these statements.
BIOMERICA, INC. CONSOLIDATED BALANCE SHEET
February 28, 1997 --------------- Liabilities and Shareholders' Equity Current Liabilities Current portion of note payable to bank ............................ $ 260,000 Accounts payable and accrued liabilities ........................... 831,327 Long-term debt and capital lease obligations (current portion) ..... 21,490 Accrued compensation ............................................... 554,664 Line of credit ..................................................... 248,000 --------------- Total Current Liabilities ....................................... 1,915,481 Minority interest..................................................... 2,133,173 Shareholders' Equity Common stock ....................................................... 310,632 Additional paid-in-capital ......................................... 12,405,250 Unrealized holding gain on available for sale securities ........... 110,905 Accumulated deficit ................................................ (9,389,662) --------------- Total Shareholders' Equity............................................ 3,437,125 --------------- Total Liabilities and Equity.......................................... $ 7,485,779 --------------- --------------- The accompanying notes are an integral part of these statements.
BIOMERICA, INC. CONSOLIDATED STATEMENT OF CASH FLOWS NINE MONTHS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996
1997 1996 ------------- ------------- Cash flows from operating activities: Net income....................................................... 330,742 225,622 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization ................................. 187,800 234,280 Realized loss (gain) on sale of marketable securities ......... 6,758 (357) Minority interest in net profits of consolidated subsidiaries . 19,250 56,148 Changes in current assets and liabilities: Provision for losses on accounts receivable .................. 0 30,000 Accounts Receivable ......................................... (103,483) (84,985) Inventories ................................................. (228,142) (365,281) Prepaid expenses and other current assets ................... 41,015 35,945 Accounts payable and other accrued liabilities .............. 128,926 161,797 Accrued compensation ........................................ 28,150 36,536 ------------- ------------- Net cash provided by operating activities........................ 411,017 499,675 ------------- ------------- Cash flows from investing activities: Purchases of property and equipment ........................... (95,078) (119,857) Sales of marketable securities, net ........................... 25,946 0 Other assets .................................................. 10,272 36,878 Purchases of intangible assets ................................ (450) (3,140) Note receivable ............................................... 20,000 8,681 ------------- ------------ Net cash used in investing activities............................ (39,310) (77,438) ------------- ------------ Cash flows from financing activities: Issuance of stock ............................................. 55,000 0 Proceeds from sale of stock ................................... 978,022 20,250 Net payments under line of credit agreement ................... (2,000) (226,000) Principal payments on note payable to bank .................... (180,000) (285,000) Payments of long-term debt and capital lease obligations ...... (16,005) (20,366) Exercise of stock options ..................................... 56,930 19,400 ------------- ------------ Net cash provided by (used in) financing activities.............. 891,947 (491,716) ------------- ------------ Net increase (decrease) in cash and cash equivalents............. 1,263,654 (69,479) ------------- ------------ Cash at beginning of year........................................ 622,828 694,564 ------------- ------------ Cash at end of Nine Months....................................... $ 1,886,482 $ 625,085 ------------- ------------ ------------- ------------ The accompanying notes are an integral part of these statements.
BIOMERICA, INC. STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE NINE MONTHS ENDED FEBRUARY 28, 1997
Unrealized Gain on Common Stock Additional Available- Retained ------------------------------- Number of Paid-In For-Sale Earnings Shares Amount Capital Securities (Deficit) Total ------------- ------------- ------------ ------------- -------------- ------------- Balance at May 31, 1996 3,465,819 $ 277,266 $11,348,664 $ 90,687 $(9,720,404) $ 1,996,213 Change in unrealized gain on available for sale securities 20,218 20,218 Issuance of stock 27,500 2,200 52,800 55,000 Exercise of employee stock options 56,250 4,500 52,430 56,930 Private placement 333,333 26,666 951,356 978,022 Net income 330,742 330,742 ------------- ------------- ----------- -------------- ------------- ------------ Balance at February 28, 1997 3,882,902 $ 310,632 $12,405,250 $ 110,905 $(9,389,662) $ 3,437,125 ------------- ------------- ----------- -------------- ------------- ------------ ------------- ------------- ----------- -------------- ------------- ------------ Note: The authorized capital stock consists of 10,000,000 shares of common stock, par value $.08 per share. The accompanying notes are an integral part of these statements.
NOTES TO FINANCIAL STATEMENTS February 28, 1997 (1) Reference is made to Note 1 of the Notes to Financial Statements contained in the Company's Annual Report on Form 10-KSB for the fiscal year ended May 31, 1996, for a summary of significant accounting policies utilized by the Company. (2) The information set forth in these statements is unaudited and may be subject to normal year-end adjustments. The information reflects all adjustments which, in the opinion of management, are necessary to present a fair statement of results of operations of Biomerica, Inc., for the periods indicated. It does not include all information and footnotes necessary for a fair presentation of financial position, results of operations, and cash flow in conformity with generally accepted accounting principles. (3) Results of operations for the interim periods covered by this Report may not necessarily be indicative of results of operations for the full fiscal year. (4) Reference is made to Notes 2 & 3 of the Notes to Financial Statements contained in the Company's Annual Report on Form 10-KSB for the fiscal year ended May 31, 1996, for a description of the investments in affiliates and consolidated subsidiaries. (5) Reference is made to Note 5, 6, 11 and 12 of the Notes to Financial Statements contained in the Company's Annual Report on Form 10-KSB for the fiscal year ended May 31, 1996, for information on commitments and litigation. (6) Aggregate market value of available-for-sale securities exceeded aggregate cost by approximately $110,905 at February 28, 1997. (7) On December 20, 1996, Biomerica, Inc. sold 333,333 shares of its common stock for one million dollars to two affiliated investment funds that are accredited investors. The sale is exempt from registration under Section 4(2) of the Securities Act of 1933 (the `Act'') and/or Rule 506 of Regulation D promulgated under the Act. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND SELECTED FINANCIAL DATA RESULTS OF OPERATIONS Consolidated net sales for Biomerica were $6,856,378 for the nine months ended February 28, 1997 as compared to $6,668,909 for the same period in the previous year. This represents an increase of $187,469 (3%). For the quarter then ended, sales were $2,303,353 as compared to $2,066,334 in the previous year. This represents an increase of $237,019 (11%). Lancer Orthodontics (Lancer) had decreased sales in the first six months of the year, however in the third quarter Lancer realized an increase over the previous year. The increased Lancer sales were due to an increase in the manufacturing output. For the nine months Biomerica also had increased sales over the previous year. Cost of sales increased for the nine months $232,591 (6%) and from $1,302,359 to $1,419,736 ($117,377 or 9%) for the quarter. Lancer had higher cost of sales due to manufacturing problems for which corrective actions have been taken. For the nine months Biomerica had higher cost of goods due to higher sales. Selling, general and administrative expenses decreased for the nine months by $81,596 (3%) and increased for the three months by $24,827 (4%). Lancer had decreased expenses of $52,831 for the nine months due to a decrease in wage costs and catalog costs, partially offset by an increase in postage and advertising. Biomerica had reduced costs due to lower wages. Research and development for the nine months decreased by $12,714 (6%) and for the three months increased by $11,173 (18%). Although Lancer has decreased research and development expenses for the three and nine month periods, Biomerica has been increasing expenditures in order to accelerate the release of new products. Interest expense decreased for the nine months by $30,474 (40%) and by $5,206 (28%) for the quarter due to reduced debt and interest rates at Lancer. Minority interest in net losses of consolidated subsidiaries represents minority interests in the gain or loss of Lancer's and AIT's other shareholders. Please refer to Notes 2 and 3 in the Notes to the Consolidated Financial Statements in the report on Form 10KSB for the year ended May 31, 1996, for a more in-depth discussion on affiliates and subsidiaries. LIQUIDITY AND CAPITAL RESOURCES As of February 28, 1997, the Company had cash and available-for-sale securities in the amount of $2,229,594. Biomerica is currently able to meet its costs of operations, development and expansion through both collection of trade accounts receivable and its working capital position. Lancer is currently able to meet its costs of operations through collection of trade accounts receivable, its working capital position and its line of credit. Lancer has a note payable to the bank which is due May 1, 1998 and requires 13 monthly principal payments of $18,889 plus interest and one final principal payment of $14,444 plus interest. Lancer also has a $500,000 line of credit with the bank. The unused portion at February 28, 1997 was $192,000. On December 20, 1996, Biomerica, Inc. sold 333,333 shares of its common stock for one million dollars to two affiliated investment funds that are accredited investors. The sale is exempt from registration under Section 4(2) of the Securities Act of 1933 (the `Act'') and/or Rule 506 of Regulation D promulgated under the Act. PART II. OTHER INFORMATION Item 1. LEGAL PROCEEDINGS. Inapplicable. Item 2. CHANGES IN SECURITIES. On December 20, 1996, Biomerica, Inc. sold 333,333 shares of its common stock for one million dollars to two affiliated investment funds that are accredited investors. The sale is exempt from registration under Section 4(2) of the Securities Act of 1933 (the `Act'') and/or Rule 506 of Regulation D promulgated under the Act. Item 3. DEFAULTS UPON SENIOR SECURITIES. Inapplicable. Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. Inapplicable. Item 5. OTHER INFORMATION. Inapplicable. Item 6. EXHIBITS AND REPORTS ON FORM 8-K. None. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has fully caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: April 14, 1997 BIOMERICA, INC. By: /S/ Joseph H. Irani ---------------------- Joseph H. Irani, President Chief Executive Officer EX-27 2
5 9-MOS MAY-31-1997 JUN-01-1996 FEB-28-1997 1,886,482 343,112 2,027,453 135,918 2,263,693 6,456,616 3,019,230 2,592,060 7,485,779 1,915,481 0 0 0 310,632 3,126,493 7,485,779 6,856,378 6,856,378 4,015,712 4,015,712 0 0 45,227 359,617 28,875 330,742 0 0 0 330,742 .09 .09
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