-----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, O9nojrACLoJ3D5SThFt5D6oESQoyIbShJvwBD11ahb/SiKB1QEZtASrGgqau7xK+ mSN9JyTDa7t6uxJphwm3iQ== 0000080984-95-000006.txt : 19951119 0000080984-95-000006.hdr.sgml : 19951119 ACCESSION NUMBER: 0000080984-95-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ASPEN IMAGING INTERNATIONAL INC CENTRAL INDEX KEY: 0000741517 STANDARD INDUSTRIAL CLASSIFICATION: PENS, PENCILS & OTHER ARTISTS' MATERIALS [3950] IRS NUMBER: 840724829 STATE OF INCORPORATION: CO FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-12573 FILM NUMBER: 95592440 BUSINESS ADDRESS: STREET 1: 1500 CHERRY STREET, SUITE B CITY: LOUISVILLE STATE: CO ZIP: 80027 BUSINESS PHONE: 3036665750 MAIL ADDRESS: STREET 1: 555 ASPEN RIDGE DRIVE CITY: LAFAYETTE STATE: CO ZIP: 80026 FORMER COMPANY: FORMER CONFORMED NAME: ASPEN RIBBONS INC DATE OF NAME CHANGE: 19901022 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM l0-Q (Mark One) / X / QUARTERLY REPORT PURSUANT TO SECTION l3 OR l5(d) OF THE SECURITIES EXCHANGE ACT OF l934 For the period ended September 30, 1995 OR / / 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 0-12573 ASPEN IMAGING INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) Delaware 84-0724829 (State of Incorporation) (I.R.S. Employer Identification No.) 3830 Kelley Avenue, Cleveland, Ohio 44114 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (216) 881-5300 NA (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the registrant (l) has filed all reports required to be filed by Section l3 or l5(d) of the Securities Exchange Act of l934 during the preceding l2 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 Number of Common Shares Outstanding as of November 10, 1995: 3,988,756 1 ASPEN IMAGING INTERNATIONAL, INC. Page Number PART I - FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Consolidated Balance Sheets as of September 30, 1995 and June 30, 1995. . . . . . . . 3 Consolidated Statements of Operations for the Three Months Ended September 30, 1995 and 1994 . . . . . . . . . . . . 5 Consolidated Statements of Cash Flows for the Three Months Ended September 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . 6 Notes to Consolidated Financial Statements . . . . . 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. . . . . . . . . . . . . . . . . . . . 8 PART II - OTHER INFORMATION . . . . . . . . . . . . . . . . . . 10 Item l. Legal Proceedings. Item 2. Changes in Securities. Item 3. Defaults Upon Senior Securities. Item 4. Submission of Matters to a Vote of Security Holders. Item 5. Other Information. Item 6. Exhibits and Reports on Form 8-K. SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . 11 2 PART I - FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited)--Note A. ASPEN IMAGING INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Balance Sheets
September 30, June 30, 1995 1995 ASSETS CURRENT ASSETS Cash and cash equivalents $ 3,488,834 $ 2,870,575 Short-term investments 548,657 526,213 Marketable securities 484,000 987,900 Receivables (less allowances of $50,881 and $25,000 for doubtful accounts) 806,528 747,644 Inventories -- Note B 772,201 725,703 Prepaid expenses and other current assets 28,164 44,385 ------------ ------------- TOTAL CURRENT ASSETS 6,128,384 5,902,420 PROPERTY AND EQUIPMENT Leasehold improvements 140,457 140,457 Machinery and equipment 1,091,902 1,091,902 Molds 2,994,750 2,994,750 Office equipment and vehicles 322,261 322,261 ------------ ------------- 4,549,370 4,549,370 Less accumulated depreciation and amortization 3,355,435 3,218,863 ------------ ------------- 1,193,935 1,330,507 NOTES RECEIVABLE 16,550 18,800 OTHER ASSETS, NET -- Note A 124,850 137,764 ------------ ------------ TOTAL ASSETS $ 7,463,719 $ 7,389,491 ============ ============ See notes to consolidated financial statements.
3 ASPEN IMAGING INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS--CONTINUED
September 30, June 30, 1995 1995 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable and accrued expenses $ 868,400 $ 671,163 Accrued salaries and payroll expenses 343,584 428,379 ------------ ------------ TOTAL CURRENT LIABILITIES 1,211,984 1,099,542 STOCKHOLDERS' EQUITY Preferred Stock, $.001 Par Value; authorized, 1,000,000 shares; no shares issued -- -- Common Stock, $.001 par value; 4,192,356 shares issued and 3,988,756 shares outstanding at September 30, 1995 and 4,192,356 shares issued and 4,075,356 shares outstanding at June 30, 1995 4,192 4,192 Capital in excess of par value 4,807,151 4,807,151 Unrealized gains on investments available for sale 74,397 78,809 Retained earnings 1,530,182 1,494,140 ------------ ------------ 6,415,922 6,384,292 Treasury stock at cost, 203,600 shares at September 30, 1995 and 117,000 shares at June 30, 1995 (164,187) (94,343) ------------ ------------ TOTAL STOCKHOLDERS' EQUITY 6,251,735 6,289,949 ------------ ------------ TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 7,463,719 $ 7,389,491 ============ ============ See notes to consolidated financial statements.
4 ASPEN IMAGING INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Statements of Operations
Three Months Ended September 30 l995 l994 REVENUE Net sales $ 1,488,383 $ 2,192,323 Other 108,587 72,984 ------------ ------------ 1,596,970 2,265,307 COST AND EXPENSES Cost of products sold 1,157,374 1,624,677 Selling, general and administrative 403,554 545,644 Interest -- 16,483 ------------ ------------ 1,560,928 2,186,804 INCOME BEFORE INCOME TAXES 36,042 78,503 PROVISION FOR INCOME TAXES -- -- ------------ ------------ NET INCOME $ 36,042 $ 78,503 ============ ============ NET INCOME PER COMMON SHARE $ 0.01 $ 0.02 ============ ============ WEIGHTED AVERAGE SHARES 4,037,626 4,192,356 ============ ============ See notes to consolidated financial statements.
5 ASPEN IMAGING INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows
Three Months Ended September 30 l995 l994 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 36,042 $ 78,503 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 149,486 139,967 Provision for doubtful accounts 40,000 3,250 (Gain) from sale of investments (35,881) -- (Gain) on disposal of assets (300) (44,676) Changes in operating assets and liabilities: Receivables (98,884) 30,148 Inventories (46,498) 220,898 Prepaid expenses and other current assets (6,223) (82,935) Accounts payable and accrued expenses 197,237 (35,770) Accrued salaries and payroll expenses (84,795) (52,931) NET CASH PROVIDED BY OPERATING ACTIVITIES 150,184 256,454 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property and equipment 300 108,234 Additions to property and equipment -- (75,388) Change in notes receivable 2,250 31,867 Change in other assets -- 4,685 Proceeds from sale of investments 535,369 -- NET CASH PROVIDED BY INVESTING ACTIVITIES 537,919 69,398 CASH FLOWS FROM FINANCING ACTIVITIES Payment of long-term debt -- (35,126) Purchase of treasury stock (69,844) -- NET CASH (USED IN) FINANCING ACTIVITIES (69,844) (35,126) NET INCREASE IN CASH AND CASH EQUIVALENTS 618,259 290,726 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 2,870,575 1,784,846 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,488,834 $ 2,075,572 SUPPLEMENTAL INFORMATION: Interest Paid $ -- $ 16,483 Taxes Paid $ -- $ -- See notes to consolidated financial statements.
6 ASPEN IMAGING INTERNATIONAL, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 1995 NOTE A -- Basis Of Presentation - ------------------------------- The accompanying consolidated condensed financial statements include the accounts of Aspen Imaging International, Inc. (the "Company") and its wholly-owned subsidiaries, Aspen Ribbons International, Inc., a Domestic International Sales Corporation, and Aspen Toner Corporation, a manufacturer of laser toner. The financial statements have been prepared without audit and reflect, in the opinion of management, all adjustments necessary for fair statement of the results of the Company's operations for the periods presented. These include only normal recurring adjustments. It is recommended that these financial statements be read in conjunction with the Company's annual report for the year ended June 30, 1995. The Company adopted the provisions of Statement of Financial Accounting Standards (SFAS) No. 115, "Accounting for Certain Investments in Debt and Equity Securities," for investments. Management determines the appropriate classification of marketable securities at the time of purchase and reevaluates such designation as of each balance sheet date. Marketable securities held as available for sale are carried at fair value with any unrealized gains or losses reported as a separate component of shareholders' equity. Realized gains and losses on marketable securities held as available for sale are included in other income. Interest and dividends on securities classified as available for sale are included in other income. Other assets include $112,205 of formulas for the production of toner, net of $212,795 accumulated amortization. The Company recognizes sales when product is shipped. Certain prior amounts have been reclassified to conform with the current year presentation. NOTE B -- Inventories - --------------------- Inventories consisted of: September 30 June 30 1995 1995 Raw materials and component parts $ 338,971 $ 324,703 Finished goods, including goods purchased for resale 433,230 401,000 ---------- ---------- $ 772,201 $ 725,703 ========== ========== 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. RESULTS OF OPERATIONS Comparison of the Three Months Ended September 30, 1995 and 1994 - ---------------------------------------------------------------- As reported in the Company's Form 10-K for the year ended June 30, 1995, the Company continues to reduce its product offerings and focus on its traditional ribbon business for impact printers, particularly ribbons for which the Company has molds, and on its toner products line for laser printers. The reduction in sales in the three months ended September 30, 1995 from the same period in 1994, is primarily the result of the elimination of unprofitable products from the Company's product line and a continuing deterioration in the sales of the Company's core products. Although inventory increased from June 30, 1995 to September 30, 1995, inventory levels are lower at September 30, 1995 compared to September 30, 1994 by approximately $805,000. This is a result of the Company's efforts to reduce inventory levels to those more appropriate to its current rate of sales. The current rate of sales, however, continues not to be sufficient to fully absorb the Company's normal overhead costs. Approximately $28,000 of overhead variances were expensed for the quarter ended September 30, 1995, causing a decrease in the Company's gross profit. The Company reduced its selling, general and administrative costs by $140,000 for the three months ended September 30, 1995 to be more in line with the Company's current rate of sales. There was no interest expense in the first quarter due to the elimination of debt. 8 Liquidity and Capital Resources - ------------------------------- The investment in the Company by Buckeye Business Products, Inc., a Division of Bobbie Brooks, Incorporated ("Buckeye"), in 1993, allowed the Company to utilize its assets in a more productive manner in an effort to return the Company to profitability. The Company used Buckeye's investment to eliminate the Company's working capital debt and the relationship with Buckeye allowed the Company to sell its building, eliminate all long-term debt, and substantially reduce staffing levels. This has resulted in a reduction in the Company's losses and cash requirements, notwithstanding the continuing sales deterioration that began several years ago. On February 15, 1995, the Company announced that it would purchase, from time to time in the open market, up to 750,000 shares of its stock. Through November 10, 1995, the Company has repurchased 203,600 of its shares at an aggregate purchase price of $164,187. The Company's current ratio was 5.1 to 1 at September 30, 1995 compared to 5.4 to 1 at June 30, 1995. The Company has $3,488,834 in cash and cash equivalents and $1,032,657 in marketable securities and other short-term investments and no long-term debt at September 30, 1995. Accordingly, the Company believes that its capital resources are more than sufficient to support its current and planned levels of operations and its announced stock repurchase. 9 PART II - OTHER INFORMATION Item l. LEGAL PROCEEDINGS. None Item 2. CHANGES IN SECURITIES. None Item 3. DEFAULTS UPON SENIOR SECURITIES. None Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None Item 5. OTHER INFORMATION. On October 24, 1995, the Company received a proposal from Pubco Corporation ("Pubco") pursuant to which the Company would sell all of its assets to a wholly-owned Pubco subsidiary and Company's stockholders would receive one share of newly issued Pubco Common Stock for each seven shares of the Company's Common Stock owned by them. Pubco owns approximately 90% of Bobbie Brooks, Incorporated, which owns approximately 43% of the Company. The proposal must be approved by the Company's Board of Directors, which has not yet considered the matter, and by the Company's stockholders at a meeting called for such purpose. The Company's Board of Directors expects to retain a financial advisor to opine as to the fairness of the proposed transaction. Item 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits Financial Data Schedule (b) Reports on Form 8-K None 10 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. ASPEN IMAGING INTERNATIONAL, INC. /s/ Robert H. Kanner ----------------------------------- Robert H. Kanner Chairman of the Board and Chief Financial Officer Dated: November 14, 1995 11 EXHIBIT INDEX Financial Data Schedule 12 EX-27 2
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONSOLIDATED BALANCE SHEET AT 9/30/95 AND CONSOLIDATED STATEMENT OF OPERATIONS FOR THE 3 MONTHS ENDED 9/30/95 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS JUN-30-1996 SEP-30-1995 3,488,834 1,032,657 857,409 50,881 772,201 6,128,384 4,549,370 3,355,435 7,463,719 1,211,984 0 4,192 0 0 6,247,543 7,463,719 1,488,383 1,596,970 1,157,374 1,157,374 0 0 0 36,042 0 36,042 0 0 0 36,042 .01 .01
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