-----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, PSbU+IO+wiehMMFh4JVAygItL9kalESoO9KkiV3YvAZ8zT0sk9jA9UXh73jlAYds WopFDnjcReNJz5xOS4pWEw== 0000889812-95-000607.txt : 19951130 0000889812-95-000607.hdr.sgml : 19951130 ACCESSION NUMBER: 0000889812-95-000607 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951030 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN CLAIMS EVALUATION INC CENTRAL INDEX KEY: 0000774517 STANDARD INDUSTRIAL CLASSIFICATION: 6411 IRS NUMBER: 112601199 STATE OF INCORPORATION: NY FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-14807 FILM NUMBER: 95585233 BUSINESS ADDRESS: STREET 1: 375 N BROADWAY STREET 2: ONE JERICHO PLAZA CITY: JERICHO STATE: NY ZIP: 11753 BUSINESS PHONE: 5169388000 MAIL ADDRESS: STREET 1: ONE JERICHO PLAZA CITY: JERICHO STATE: NY ZIP: 11753 10-Q 1 QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the quarterly 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: 0-14809 AMERICAN CLAIMS EVALUATION, INC. ------------------------------------------------------ (Exact name of Registrant as specified in its charter) New York 11-2601199 - - ------------------------------- ------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) One Jericho Plaza, Jericho, New York 11753 - - ---------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (516) 938-8000 ---------------------------------------------------- (Registrant's telephone number, including area code) (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 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 ____ APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock, par value $.01 per share 4,250,000 shares outstanding at October 25, 1995 AMERICAN CLAIMS EVALUATION, INC. INDEX Page No. -------- PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements Consolidated Balance Sheets as of September 30, 1995 and March 31, 1995 3 Consolidated Statements of Earnings for the Six Months and Three Months, respectively, ended September 30, 1995 and 1994 4 Consolidated Statements of Cash Flows for the Six Months ended September 30, 1995 and 1994 5 Notes to Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7-8 PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 9 SIGNATURES 10 2 PART I. FINANCIAL INFORMATION Item 1 - Consolidated Financial Statements AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARIES Consolidated Balance Sheets Sep. 30, 1995 Mar. 31, 1995 ------------- ------------- (Unaudited) Assets ------ Current Assets: Cash and cash equivalents $6,102,417 5,500,159 Accounts receivable (net of allowance for doubtful accounts of $15,000) 826,272 834,932 Prepaid expenses 63,728 101,793 ---------- ---------- Total current assets 6,992,417 6,436,884 Marketable securities 1,154,563 1,157,625 Property and equipment, net 326,088 372,259 Excess cost over fair value of net assets acquired, net 582,299 598,511 Deposits 905 1,905 ---------- ---------- $9,056,272 8,567,184 ========== ========== Liabilities and Stockholders' Equity ------------------------------------ Current liabilities: Accounts payable 508,905 481,444 Accrued expenses 105,727 119,905 Income taxes payable 275,050 103,142 Deferred income taxes 131,585 181,973 ---------- ---------- Total current liabilities 1,021,267 886,464 ---------- ---------- Stockholders' equity: Common stock, $.01 par value; authorized 10,000,000 shares; 4,250,000 shares issued and outstanding 42,500 42,500 Additional paid-in capital 3,267,699 3,267,699 Unrealized gain on marketable securities, net of tax 209,864 131,243 Retained earnings 4,514,942 4,239,278 ---------- ---------- Total stockholders' equity 8,035,005 7,680,720 ---------- ---------- $9,056,272 8,567,184 ========== ========== Note: The balance sheet at March 31, 1995 has been derived from the audited financial statements at that date. 3 AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARIES Consolidated Statements of Earnings (Unaudited) Three months ended Six months ended ------------------ ---------------- Sep. 30, 1995 Sep. 30, 1994 Sep. 30, 1995 Sep. 30, 1994 ------------- ------------- ------------- ------------- Revenues $1,382,875 1,325,770 2,776,944 2,772,443 Cost of services 656,607 525,652 1,284,196 1,136,905 ---------- --------- --------- --------- Gross margin 726,268 800,118 1,492,748 1,635,538 Selling, general and administrative expenses 621,131 915,653 1,298,711 1,768,940 ---------- --------- --------- --------- Operating earnings 105,137 (115,535) 194,037 (133,402) (loss) Other income: Interest income 84,823 64,604 166,053 117,047 Gain on sale of marketable securities 28,228 - 66,721 - Miscellaneous income 19,427 9,804 38,853 24,676 ---------- --------- --------- --------- Earnings (loss) before provision for (benefit from) income taxes 237,615 (41,127) 465,664 8,321 Provision for (benefit from) income taxes 100,000 (8,000) 190,000 4,000 ---------- --------- --------- --------- Net earnings (loss) $ 137,615 (33,127) 275,664 4,321 ========== ========= ========= ========= Net earnings (loss) per share of common stock $ .03 (.01) .06 .00 ========== ========= ========= ========= Weighted average common and common equivalent shares 4,251,267 4,250,000 4,250,634 4,258,334 ========== ========= ========= ========= 4 AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) Six months ended ---------------- Sep. 30, 1995 Sep. 30, 1994 ------------- ------------- Cash flows from operating activities: Net earnings $ 275,664 4,321 ---------- ---------- Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 72,750 78,775 Gain on sales of marketable securities (66,721) - Deferred income taxes (91,000) (92,000) Changes in assets and liabilities: Decrease in accounts receivable 8,660 22,678 Decrease in prepaid expenses 38,065 4,889 Decrease in prepaid taxes - 87,440 (Increase) decrease in deposits 1,000 (2,654) Increase in accounts payable 27,461 148,524 (Decrease) in accrued expenses (14,178) (66,251) Increase in income taxes payable 171,908 - ---------- ---------- Total adjustments 147,945 181,401 ---------- ---------- Net cash provided by operating activities 423,609 185,722 ---------- ---------- Cash flows from investing activities: Decrease in short-term investments - (3,018,840) Purchase of marketable securities (26,893) (388,980) Proceeds from sales of marketable securities 215,909 - Capital expenditures (10,367) (39,598) ---------- ---------- Net cash provided by (used in) investing activities 178,649 (3,447,418) ---------- ---------- Net increase (decrease) in cash and cash equivalents 602,258 (3,261,696) Cash and cash equivalents at beginning of period 5,500,159 3,978,409 ---------- ---------- Cash and cash equivalents at end of period $6,102,417 716,713 ========== ========== Supplemental Disclosure of Cash Flow Information: Income taxes paid $ 109,092 8,560 ========== ========== 5 AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) General The accompanying unaudited financial statements and footnotes have been condensed and therefore do not contain all disclosures required by generally accepted accounting principles. Reference should be made to the Company's Annual Report to Shareholders for the year ended March 31, 1995. In the opinion of management, all adjustments (consisting of normal recurring accruals) have been made to present fairly the financial position, results of operations and cash flows as at and for the periods shown. Financial Statement Reclassification Certain reclassifications have been made to prior periods' financial statements to conform to the current period's presentation. Marketable Securities Marketable securities are classified as available for sale securities and as a result are recorded at fair value. Fair value is determined based on quoted market prices. Unrealized gains, net of taxes, are reported as a separate component of stockholders' equity. For purposes of determining realized gains and losses, the cost of marketable securities is based on the first-in, first-out method. 6 Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations - Six Months ended September 30, 1995 and 1994 Consolidated revenues for the six months ended September 30, 1995 totaled $2,776,944, which were relatively consistent with the $2,772,443 reported for the comparable period ended September 30, 1994. For the three months ended September 30, 1995, consolidated revenues were $1,382,875 compared to $1,325,770 for the corresponding period in the previous year, reflecting an increase of 4.3%. During this period, hospital bill audit ("HBA") services increased by 6.5% and vocational rehabilitation services declined by 2.3% from the prior year's results. The cost of evaluations for HBA services as a percentage of HBA revenues increased to 46.1% for the six months ended September 30, 1995 from the previous year's comparable percentage of 38.4%. This increase is primarily attributable to a change in the mix of HBA services currently being rendered. Provider discount network services, which were not offered during the six month period ended September 30, 1994, generally provide lower gross margins due to the cost of the related access fees. The cost of services for vocational rehabilitation services decreased to 46.9% of related revenues for the six months ended September 30, 1995 as compared to 49.2% of related revenues in the same period last year. Selling, general and administrative expenses for the six months ended September 30, 1995 decreased to 46.8% of consolidated revenues from 63.8% of consolidated revenues for the comparable period last year. This decrease was achieved through various cost saving measures introduced during the prior fiscal year, the benefits of which are now being fully realized. Overall, selling, general and administrative expenses decreased by $470,229 (26.6%) from the comparable six month period last year even though revenues were relatively unchanged. During the six months ended September 30, 1995, the Company earned $166,053 of interest income representing an increase of $49,006 over the six months ended September 30, 1994. This increase resulted from higher interest rates in addition to an increase in the Company's cash and cash equivalents available for investment. The Company also realized gains of $66,721 on the sales of marketable securities during the current six month period. Liquidity and Capital Resources During the six month period ended September 30, 1995, cash provided by operating activities was $423,609, compared with $185,722 during 7 the comparable period last year. Net earnings of $275,664 and an increase in income taxes payable of $171,908 were the major factors in cash provided by operations during the current quarter. Cash provided by investing activities for the six months ended September 30, 1995 was $178,649. During this period, $215,909 of cash provided from the proceeds of sales of marketable securities was offset by $26,893 used for the purchase of additional marketable securities and $10,367 used for capital expenditures. At September 30, 1995, the Company had working capital of $5,971,150 as compared to working capital of $5,550,420 at March 31, 1995. The Company believes that it has sufficient cash resources and working capital to meet its present cash requirements. The Company is engaged in a far-reaching review of possibilities for maximizing shareholder value, centering upon strategic acquisitions and/or dispositions of assets. In connection therewith, the Company will consider acquisitions within its current line of business as well as other fields. 8 PART II. OTHER INFORMATION Item 4 - Submission of Matters to a Vote of Security Holders The Annual Meeting of Shareholders of American Claims Evaluation, Inc. was held on September 21, 1995. One proposal, subject to shareholder approval, was approved at the Annual meeting by a vote of shareholders. Under this proposal, management nominees for election to the Board of Directors, Messrs. Gelman, Elkin and Gutmann, were re-elected as directors of the Company to serve until the Annual Meeting of Shareholders to be held in 1996 and until their respective successors are duly elected and qualified. Item 6 - Exhibits and Reports on Form 8-K (a) None. (b) No reports on Form 8-K were filed during the quarter ended September 30, 1995. 9 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereto duly authorized. AMERICAN CLAIMS EVALUATION, INC. /s/ Gary Gelman Date: October 27, 1995 By: ------------------------------ Gary Gelman Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer) /s/ Gary J. Knauer Date: October 27, 1995 By: ----------------------------- Gary J. Knauer Chief Financial Officer and Treasurer (Principal Financial Officer) 10 EX-27 2 FINANCIAL DATA SCHEDULE
5 The schedule contains summary financial information extracted from the consolidated financial statements and is qualified in its entirety by reference to such financial statements. 1 6-MOS MAR-31-1995 SEP-30-1995 6,102,417 1,154,563 841,272 15,000 0 6,992,417 856,646 530,558 9,056,272 1,021,267 0 42,500 0 0 3,267,699 9,056,272 2,776,944 2,776,944 1,284,196 1,284,196 1,298,711 0 0 465,664 190,000 275,664 0 0 0 275,664 0.06 0.06
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