-----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, OoIOFFS4KsXqPiPXBXmc4W9DZyz0ZPR+FQkO9SQRKiRjDn8z9gGNcAdFvhv9PZgP B6TwkC5SGoB6m8ZHP61hXA== 0000950130-95-002393.txt : 19951119 0000950130-95-002393.hdr.sgml : 19951119 ACCESSION NUMBER: 0000950130-95-002393 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951113 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: MOORE MEDICAL CORP CENTRAL INDEX KEY: 0000074691 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-DRUGS PROPRIETARIES & DRUGGISTS' SUNDRIES [5122] IRS NUMBER: 221897821 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08903 FILM NUMBER: 95589814 BUSINESS ADDRESS: STREET 1: PO BOX 1500 STREET 2: PO BOX 1500 CITY: NEW BRITAIN STATE: CT ZIP: 06050 BUSINESS PHONE: 2038263600 MAIL ADDRESS: STREET 1: 389 JOHN DOWNEY DRIVE STREET 2: 389 JOHN DOWNEY DRIVE CITY: NEW BRITAIN STATE: CT ZIP: 06050 FORMER COMPANY: FORMER CONFORMED NAME: OPTEL CORP DATE OF NAME CHANGE: 19850611 10-Q 1 QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 1995 FORM 10 - Q For the Fiscal THIRD QUARTER Ended September 30, 1995 Quarterly Report Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934 MOORE MEDICAL CORP. (Exact name of registrant as specified in its charter) DELAWARE 1-8903 (State of incorporation) (Commission File Number) P.O. BOX 1500, NEW BRITAIN, CT 06050 22-1897821 (Address of principal executive offices) (I.R.S. Employer Identification Number) 203-826-3600 (Registrant's telephone number) SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: COMMON STOCK ($.01 PAR VALUE) AMERICAN STOCK EXCHANGE (Title of Each Class) (Name of each exchange on which registered) 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 twelve months, and (2) has been subject to such filing requirements for the past 90 days. Yes X No _____ ------- 2,880,956 Number of shares of Common Stock outstanding as of November 8, 1995. Total number of pages in the numbered original is 10 This is page 1 of 10 pages. --------------------------- MOORE MEDICAL CORP. INDEX Page No. -------- PART I. FINANCIAL INFORMATION Item I. Financial Statements Balance Sheets at the end of the third quarter of 1995 and at the end of the year 1994................ 3 Statements of Operations for the third quarters of 1995 and 1994.................................... 4 Statements of Operations for the first three quarters of 1995 and 1994.................................... 5 Statements of Cash Flows for the first three quarters of 1995 and 1994.................................... 6 Notes to Financial Statements.......................... 7 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition.................. 8-10 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K.............. 10 Signatures............................................. 10 2
MOORE MEDICAL CORP. Balance Sheets at end of the - ---------------------------- Amounts in thousands THIRD QUARTER 1995 YEAR 1994 (Unaudited) ASSETS CURRENT ASSETS Cash $ 53 $ 59 Accounts receivable, less allowance for doubtful accounts of $109 and $225....... 26,685 21,313 Inventories................................. 45,297 43,160 Prepaid expenses and other current assets... 5,264 4,709 Deferred taxes.............................. 609 909 ------- ------- Total Current Assets................... 77,908 70,150 ------- ------- NONCURRENT ASSETS Equipment and leasehold improvements, net... 5,306 4,497 Other assets................................ 815 990 ------- ------- Total Noncurrent Assets................ 6,121 5,487 ------- ------- $84,029 $75,637 ======= ======= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable............................ $25,028 $24,532 Accrued expenses............................ 3,246 3,589 ------- ------- Total Current Liabilities.............. 28,274 28,121 ------- ------- DEFERRED TAXES............................... 410 409 REVOLVING CREDIT FINANCING................... 30,266 23,798 SHAREHOLDERS' EQUITY Preferred stock - no shares outstanding..... -- -- Common stock - $.01 par value; 5,000 shares authorized; 3,246 shares issued...................... 32 32 Capital in excess of par value.............. 21,675 21,772 Retained earnings........................... 6,547 4,955 ------- ------- 28,254 26,759 Less treasury shares, at cost, 367 and 388 shares................................... (3,175) (3,450) ------- ------- Total Shareholders' Equity............. 25,079 23,309 ------- ------- $84,029 $75,637 ======= =======
The accompanying notes are an integral part of the financial statements. 3 MOORE MEDICAL CORP. STATEMENTS OF OPERATIONS
Statements of Operations for the Amounts in thousands, except per share data THIRD QUARTER ------------- 1995 1994 (Unaudited) Net sales................................... $72,296 $65,306 Cost of products sold....................... 61,498 54,923 ------- ------- Gross profit................................ 10,798 10,383 Selling, general & administrative expenses.. 9,030 8,274 ------- ------- Operating income............................ 1,768 2,109 Interest expense, net....................... 758 509 ------- ------- Income before income taxes.................. 1,010 1,600 Income tax provision........................ 335 560 ------- ------- Net income.................................. $ 675 $ 1,040 ======= ======= Net income per share........................ $.23 $.36 ======= =======
The accompanying notes are an integral part of the financial statements. 4 MOORE MEDICAL CORP. Statements of Operations for the
Amounts in thousands, except per share data FIRST THREE QUARTERS -------------------- 1995 1994 (Unaudited) Net sales................................... $222,345 $205,374 Cost of products sold....................... 190,944 175,966 -------- -------- Gross profit................................ 31,401 29,408 Selling, general & administrative expenses.. 26,926 23,738 -------- -------- Operating income............................ 4,475 5,670 Interest expense, net....................... 1,996 1,392 -------- -------- Income before income taxes.................. 2,479 4,278 Income tax provision........................ 887 1,500 -------- -------- Net income.................................. $ 1,592 $ 2,778 ======== ======== Net income per share........................ $.55 $.96 ======== ========
The accompanying notes are an integral part of the financial statements. 5
MOORE MEDICAL CORP. Statements of Cash Flows for the Amounts in thousands FIRST THREE QUARTERS -------------------- 1995 1994 (Unaudited) CASH FLOWS FROM OPERATIONS Net income............................. $ 1,592 $ 2,778 Adjustments to reconcile net income to net cash flows provided by operating activities Depreciation and amortization......... 1,222 1,148 Deferred taxes........................ 301 482 Other................................. 240 67 Changes in operating assets and liabilities Accounts receivable.................. (5,372) (4,126) Inventory............................ (2,137) (4,866) Other current assets................. (555) (1,564) Accounts payable..................... 496 7,564 Other current liabilities............ (228) (1,173) ------- ------- Net cash flows (used in) provided by operating activities................. (4,441) 310 ------- ------- CASH FLOWS FROM INVESTING ACTIVITIES Equipment & leasehold improvements (2,096) (1,059) acquired.............................. Other, net............................. -- (73) ------- ------- Net cash flows used in investing (2,096) (1,132) activities........................... ------- ------- CASH FLOWS FROM FINANCING ACTIVITIES Revolving credit financing increase, net................................... 6,468 826 Other, net............................. 63 -- ------- ------- Net cash flows provided by financing activities................ 6,531 826 ------- ------- (Decrease) increase cash................ (6) 4 Cash at beginning of period............. 59 53 ------- ------- CASH AT END OF PERIOD................... $ 53 $ 57 ======= =======
The accompanying notes are an integral part of the financial statements. 6 MOORE MEDICAL CORP. NOTES TO FINANCIAL STATEMENTS NOTE 1 - BASIS OF PRESENTATION OF FINANCIAL STATEMENTS The accompanying financial statements should be read in conjunction with the Notes to Financial Statements and Management's Discussion and Analysis of Results of Operations and Financial Condition included in the Company's 1994 Annual Report filed on Form 10-K and in this Form 10-Q Report. In the opinion of management, all adjustments necessary for a fair presentation of the results for the interim periods have been made. The results of operations for the third quarter are not necessarily indicative of the results to be expected for the full year. The fiscal quarters ended September 30, 1995 and October 1, 1994. NOTE 2 - NET INCOME PER SHARE Net income per share of common stock is based on the weighted average number of common shares outstanding (adjusted for dilutive common stock options), which was 2,907,000 shares and 2,918,000 shares in the third quarters of 1995 and 1994, respectively, and 2,899,000 shares and 2,908,000 shares in the first three quarters of 1995 and 1994, respectively. 7 MOORE MEDICAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION OVERVIEW - -------- The following table sets forth items included in the Statements of Operations as a percentage of sales for the third quarters and first three quarters of 1995 and 1994, respectively. The table also shows, for each line item, the percentage change in the 1995 periods from the comparable 1994 periods.
THIRD QUARTER FIRST THREE QUARTERS ------------------------------------------------- % of Sales % % of Sales % ------------------------------------------------- 1995 1994 Change 1995 1994 Change ------------------------------------------------- Net sales.......................... 100.0% 100.0% 11% 100.0% 100.0% 8% Cost of products sold.............. 85.1 84.1 12 85.9 85.7 9 ----- ----- ---- ----- ----- ---- Gross profit....................... 14.9 15.9 4 14.1 14.3 7 Selling, general & admin expense. 12.5 12.7 9 12.1 11.5 13 ----- ----- ---- ----- ----- ---- Operating income................... 2.4 3.2 (16) 2.0 2.8 (21) Interest expense, net.............. 1.0 0.8 49 0.9 0.7 43 ----- ----- ---- ----- ----- ---- Income before income taxes......... 1.4 2.4 (37) 1.1 2.1 (42) Income tax provision............... 0.5 0.8 0.4 0.7 ----- ----- ----- ----- Net income......................... 0.9% 1.6% (35)% 0.7% 1.4% (43)% ===== ===== ===== =====
RESULTS OF OPERATIONS - --------------------- THIRD QUARTER 1995 COMPARED WITH 1994 - ----------------------- Net sales of $72.3 million for the third quarter of 1995 increased 11% over the same quarter of 1994. Sales increased for medical/surgical supplies and brand- name pharmaceuticals. Generic pharmaceutical sales in the third quarter were level with the 1994 third quarter. For the 1995 quarter, the gross margin rate dropped to 14.9% from 15.9% in the same quarter a year earlier. Gross profit dollars increased 4% to $10.8 million. Gross profit benefited from higher sales of medical/surgical supplies, which have higher gross margin rates than pharmaceuticals. More than offsetting this benefit were decreases in gross margin rates on both brand-name and generic pharmaceuticals. Competitive pressures on pharmaceutical prices in the Company's wholesale markets were particularly strong in the third quarter. 8 Selling, general and administrative expenses during the third quarter increased 9% from the third quarter of 1994. Most of the increase was attributable to added costs for marketing and distribution expenses in support of the growing sales volume of medical/surgical supplies to health-care professional customers. The 9% rate of increase for selling, general and administrative expenses was higher than the 4% increase in gross profit because the gross profit increase was diminished by lower gross margins on pharmaceuticals. Interest expense in the third quarter of 1995 increased 49% from the same quarter a year ago. Higher debt levels accounted for approximately two-thirds of the increase. Higher interest rates accounted for the remainder of the increase. Net income decreased for the third quarter of 1995. An increase in gross profit was more than offset by increases in selling, general and administrative expenses and interest expense. FIRST THREE QUARTERS 1995 COMPARED WITH 1994 - ----------------------- Net sales of $222.3 million for the first three quarters of 1995 increased 8% over the comparable 1994 period. Sales increased for medical/surgical supplies and generic pharmaceuticals. Sales of brand-name pharmaceuticals for the first nine months were almost level with the comparable 1994 period. For the first nine months of 1995, the gross margin rate decreased to 14.1% from 14.3% in the same period a year earlier. Gross profit dollars increased 7% to $31.4 million. Gross profit benefited from higher sales of medical/surgical supplies, which have higher gross margin rates than pharmaceuticals. The gross margin rate for pharmaceutical sales decreased due to continued competitive pressures in the Company's wholesale markets. Selling, general and administrative expenses for the first nine months of 1995 increased over 13% compared with the same period a year ago. Most of the increase was for added costs for marketing and distribution expenses in support of the growing sales volume of medical/surgical supplies to health-care professional customers. The 13% rate of increase for selling, general and administrative expenses was higher than the 7% increase in gross profit primarily due to extra expenses in the first half of 1995 for opening a new distribution center, higher catalog advertising expense and increased expenditures to enhance information systems. Interest expense in the first nine months of 1995 increased 43% over the same period a year ago. Higher interest rates accounted for approximately two-thirds of the increase. Higher debt levels accounted for the remainder of the increase. 9 Net income decreased for the first nine months of 1995. An increase in gross profit was more than offset by increases in selling, general and administrative expenses and interest expense. FINANCIAL CONDITION - ------------------- During the first nine months of 1995, the Company generated $3.4 million of cash from earnings (net income before non-cash charges for depreciation, amortization, and deferred taxes) and increased borrowings by $6.5 million. Cash was used to fund equipment purchases of $2.1 million and net increases in operating assets of $7.8 million. A new distribution center accounted for most of the equipment purchases and substantially all of the $2.1 million increase in inventory. Accounts receivable increased $5.4 million due primarily to higher sales at the end of the third quarter of 1995 than at the end of 1994. Management believes that funding needs for the Company's operations will continue to be met through income from operations, working capital management and financing under the existing line of credit. PART II. OTHER INFORMATION ----------------- ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K -------------------------------- (a) Exhibits -------- None. (b) Reports on Form 8-K ------------------- No report on Form 8-K was filed during the quarter. SIGNATURES ---------- Pursuant to the requirements of Section 13 or 15(d) 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. MOORE MEDICAL CORP. (REGISTRANT) By: /s/ John A. Murray By: /s/ Victor H. Emerson, Jr. ------------------ ------------------------------- John A. Murray Victor H. Emerson, Jr. Vice President - Finance and Controller and Chief Accounting Chief Financial Officer Officer November 13, 1995 November 13, 1995 10 EX-27 2 ARTICLE 5 FINANCIAL DATA SCHEDULE
5 1,000 3-MOS 3-MOS DEC-30-1995 DEC-30-1995 JUL-02-1995 APR-02-1995 SEP-30-1995 JUL-01-1995 53 53 0 0 26,794 25,529 109 228 45,297 47,513 5,873 6,716 13,863 13,650 8,557 8,151 84,029 85,944 28,274 30,073 0 0 32 32 0 0 0 0 25,047 24,368 84,029 85,944 72,296 72,271 72,296 72,271 61,498 62,034 61,498 62,034 9,030 8,843 0 0 758 702 1,010 692 335 260 675 432 0 0 0 0 0 0 675 432 0.23 0.15 0.23 0.15
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