-----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, Ie2+ce6KOt41EF3GmDMFdM4AXW2g2ourRsMWelybhrbdrpN/WxZBRbgCC+TvfkrM xtAHzsrbjkxBIPuTkXUlMA== 0000807732-96-000003.txt : 19960410 0000807732-96-000003.hdr.sgml : 19960410 ACCESSION NUMBER: 0000807732-96-000003 CONFORMED SUBMISSION TYPE: 10QSB/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950929 FILED AS OF DATE: 19960209 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADVANCED MEDICAL PRODUCTS INC CENTRAL INDEX KEY: 0000807732 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 161284228 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10QSB/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-16341 FILM NUMBER: 96514154 BUSINESS ADDRESS: STREET 1: 111 RESEARCH DR CITY: COLUMBIA STATE: SC ZIP: 29223 BUSINESS PHONE: 8039350906 MAIL ADDRESS: STREET 1: 111 RESEARCH DR CITY: COLUMBIA STATE: SC ZIP: 29223 10QSB/A 1 ADVANCED MEDICAL PRODUCTS, INC. 111Research Drive Columbia, SC 29203 Securities and Exchange Commission Washington, D.C. 20549 Gentlemen: Pursuant to the requirements of the Securities Exchange Act of 1934, we are transmitting herewith the attached Form 10-QSB/A. Sincerely, Advanced Medical Products, Inc. Pat Mack Controller U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (mark one) X Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 29, 1995 Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act For the transition period from to Commission file number 0-16341 Advanced Medical Products Inc. (Exact Name of Small Business Issuer as Specified in Its Charter) Delaware 16-1284228 (State or Other Jurisdiction (I.R.S. Employer of Incorporation or Organization) Identification No.) 111 Research Drive, Columbia, South Carolina 29203 (Address of Principal Executive Offices) (Zip Code) (803) 935-0906 Issuer's Telephone Number, Including Area Code (Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report) Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 APPLICABLE ONLY TO CORPORATE ISSUERS State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 2,688,575 shares as of November 1, 1995. (1) PART 1 - FINANCIAL INFORMATION Item 1 - Financial Statements ADVANCED MEDICAL PRODUCTS INC. BALANCE SHEET
Sept. 29, 1995 June 30, 1995 (unaudited) (audited) ASSETS Current Assets: Cash $ 3,473 $ 32,111 Accounts receivable (net of allowance for doubtful accounts of $42,020 and $66,525 respectively) 689,738 643,153 Refundable income taxes 48,089 48,089 Inventory 1,073,456 1,208,359 Other current assets 284,760 208,589 Total current assets 2,099,516 2,140,301 Furniture and equipment, net 304,787 301,684 Product software costs, net 91,787 89,494 Other Assets 6,926 6,926 Total Assets $2,503,016 $2,538,405 ========== ==========
LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities: Current portion of long-term debt $ 49,604 $ 64,402 Accounts payable 998,384 1,053,946 Accrued wages and commissions 58,088 93,287 Other current liabilities 254,487 237,773 Total current liabilities 1,360,563 1,449,408 Dividend payable 100,000 100,000 Class A preferred stock, no par value; authorized 4,000 shares; issued and outstanding 2,000 shares; subject to mandatory redemption in the amount of $2,000,000 by October 2002 1,906,764 1,903,524 Total long-term liabilities 2,006,764 2,003,524 Total liabilities 3,367,327 3,452,932 Stockholders' deficit: Common stock, $.01 par value; authorized 5,000,000 shares, issued 2,704,195 shares, outstanding 2,688,575 at September 29, 1995 and June 30, 1995. 27,042 27,042 Additional paid in capital 2,194,415 2,194,415 Accumulated deficit (2,990,419) (3,040,635) (2) ADVANCED MEDICAL PRODUCTS INC. BALANCE SHEET CONTINUED Sept. 29, 1995 June 30 1995 (unaudited) (audited) Less notes receivable for common stock $( 67,598) $( 67,598) Less treasury stock, at cost, 15,615 shares at September 29, 1995 and June 30, 1995. ( 27,751) ( 27,751) Total stockholders' deficit ( 864,311) ( 914,527) Total liabilities and stockholders' deficit $2,503,016 $2,538,405 ========== ========== The accompanying notes are an integral part of these financial statements.
(3) ADVANCED MEDICAL PRODUCTS INC. STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
Three Months Ended Sept. 29, 1995 Sept. 30 , 1994 (unaudited) (unaudited) Net sales $1,312,879 $1,371,266 Cost of sales 623,855 680,002 Gross profit 689,024 691,264 Selling, general and administrative 567,266 740,276 Research and development 66,429 111,598 Interest expenses 1,872 23,268 Income (loss) before income taxes 53,457 (183,878) Provision for income taxes 0 0 Net income (loss) 53,457 (183,878) Retained deficit - beginning of period ( 914,527) (1,038,946) Accretion of redeemable preferred stock ( 3,241) ( 3,218) Accumulated deficit - end of period $( 864,311) $(1,226,042) ========== ========== Net income (loss) applicable to common shares $ 25,216 $( 212,096) =========== ========== Earings per common share data: Net income (loss) $ .01 (.08) =========== ========== Weighted average number of common shares outstanding 2,688,575 2,646,076 The accompanying notes are an integral part of these financial statements.
(4) ADVANCED MEDICAL PRODUCTS INC. STATEMENT OF CASH FLOWS Three Months Ended Sept. 29, 1995 Sept. 30, 1994 (unaudited) (unaudited) Cash Flows from Operating Activities: Net Income $ 53,457 $ (183,878) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 24,969 25,343 Provision for doubtful accounts ( 24,505) 81,665 Change in assets and liabilities: Accounts receivable ( 26,062) ( 19,801) Inventory 134,903 100,319 Other assets ( 72,190) (32,665) Accounts payable ( 55,562) 118,867 Other current liabilities ( 18,485) ( 54,402) Total adjustments ( 36,932) 219,326 Net cash provided by operating activities 16,525 35,448 Cash flows used by investing activities: Capital expenditures ( 22,867) ( 6,012) Capitalization of software costs ( 7,500) ( 7,800) Net cash used by investing activities ( 30,367) ( 13,812) Cash flow used by financing activities: Payments on long-term debt ( 14,796) ( 14,166) Purchases of common stock 0 0 Issuance of notes receivable for common stock 0 0 Net cash used by financing activities ( 14,796) 14,166 Net (decrease) increase in cash and cash equivalents ( 28,638) 7,470 Cash and cash equivalents at beginning of period 32,111 1,196,951 Cash and cash equivalents at end of period $ 3,473 $1,204,421 ========== ========== Supplemental disclosures of cash flow information: Cash paid during the period for: Interest $ 1,872 $ 23,268 Income taxes 0 0 The accompanying notes are an integral part of these financial statements.
(5) ADVANCED MEDICAL PRODUCTS INC. NOTES TO FINANCIAL STATEMENTS 1. Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Article 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended September 29, 1995 are not necessarily indicative of the results that may be expected for fiscal year 1996. The unaudited condensed financial statements should be read in conjunction with the financial statements and footnotes thereto included in the Company's annual report on Form 10-KSB for the year ended June 30, 1995. 2. Inventory Inventory consisted of: Sept. 29, 1995 June 30, 1995 (unaudited) (audited) Raw Material and work in process $ 554,877 $ 579,902 Finished Goods 518,579 628,456 $1,073,456 $1,208,358 ========== ========== 3. Earnings Per Share Earnings per common share were computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Earnings per share did not include the impact of the outstanding options since it was not significant. (6) ITEM 2: MANAGEMENTS DISCUSSION AND ANALYSIS RESULTS OF OPERATIONS Net sales of $1,312,879 for the three months ended September 29, 1995 represent a 5% decrease from sales of $1,371,266 in the comparable quarter in 1994. This decrease is primarily due to decreases in the Company's OEM/International distribution network. Current efforts to expand the network are in process and it is expected that these efforts will result in increased future sales. The Company's gross profit margin increased from 50% of net sales in the comparable quarter of fiscal 1995 to 58% of net sales for the three months ended September 29, 1995. This increase is a result of efforts to reduce cost of sales. Selling, general and administrative expenses of $567,266 for the three months ended September 29, 1995 were 43% of net sales for the period as compared to expenses of $740,276 or 54% of net sales for the same period last year. The decrease is a result of efforts to reduce operating expenses. Research and development costs during the first quarter of fiscal 1996 decreased 41% from last year as the phase in of the Spectra ECG and development of the Ultra PCI were completed. Net income (loss) for the quarter ended September 29, 1995 increased to $53,457 from $(183,878) for the same period last year. The net income for the first quarter of fiscal 1996 is primarily a result of the increase in gross margin and decrease in operating expenses. During the first three months of fiscal 1996, accounts receivable increased from $643,153 to $689,738. LIQUIDITY AND CAPITAL RESOURCES Operating activities provided $16,525 of cash during the quarter ended September 29, 1995 compared with $35,433 provided during the first quarter of fiscal 1995. In the first quarter of fiscal 1996, $30,367 was used for capital expenditures, compared to $13,812 for the same period last year. The Company is a party to a loan agreement, pursuant to which a Syracuse, New York bank has extended credit and loaned funds to the Company. The bank loaned the Company $250,000 with interest at 11%, $49,604 of which was outstanding as of September 29, 1995. The loan is subject to the provisions of a five year term (7) LIQUIDITY AND CAPITAL RESOURCES - Continued loan agreement. The Company has been discussing a new banking relationship with lenders in South Carolina; however, no new agreements have yet been entered into. The company has entered into a factoring agreement with Cambridge Capital Management, Inc. of Boca Raton, Florida ("Cambridge"), pursuant to which Cambridge has agreed to factor 70% of the company's eligible accounts receivable. Cambridge will receive a discount as to each receivable [ranging from 3.75% to 15% (subject to a $25 minimum)] depending upon the number of days that elapse between the date the receivable is factored and the date Cambridge collects the receivable. The company's obligations under the factoring agreement have been personally guaranteed by Clarence P. Groff, President of the company. The Company believes that internally generated funds and existing borrowing resources should provide sufficient working capital to meet present commitments. However, in order to improve its current cash flow position, the Company has undertaken steps, both internally and externally. Internal initiatives include steps to improve gross margins, reduce inventory levels, reduce accounts receivable, expand the distribution network and reduce fixed costs. External steps include seeking new banking relationships, investigating alternate sources of financing and discussing relationships in the investment banking community, as well as, the above mentioned factoring arrangement. The Company does not currently have specific plans for major capital expenditures in fiscal 1996. Should needs arise, the Company may consider additional capital sources to obtain funding. There is no assurance any additional financing, if required, will be available on terms acceptable to the Company. (8) PART II - OTHER INFORMATION Item 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits - EX-27 (b) Reports on Form 8-K - No Reports on Form 8-K have been filed during the quarter for which this report is filed, except that a report on Form 8-K dated July 24, 1995 was filed to disclose a change in the Company's fiscal year end. SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ADVANCED MEDICAL PRODUCTS, INC. (REGISTRANT) BY:S/JAMES H. BROWN JAMES H. BROWN VICE PRESIDENT DATED: FEBRUARY 9, 1996 SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ADVANCED MEDICAL PRODUCTS, INC. (REGISTRANT) BY: JAMES H. BROWN VICE PRESIDENT DATED: FEBRUARY 9, 1996 EX-27 2
5 3-MOS JUN-30-1995 SEP-29-1995 3,473 0 731,758 42,020 1,073,456 2,099,516 1,064,872 760,085 2,503,016 1,360,563 0 27,042 1,906,764 0 (891,353) 2,503,016 1,312,879 1,312,879 623,855 623,855 635,567 65,487 1,872 53,457 0 53,457 0 0 0 53,457 .01 .01
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