-----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, MwLj2wD80VcRT8Ugc3XiOezNUvoYq+hzAQjUGh2el0C5HYCQvU9u8h4eTwBonpeQ NMyFfA/z3ssbFcrgsRDJdw== 0000830736-97-000023.txt : 19971106 0000830736-97-000023.hdr.sgml : 19971106 ACCESSION NUMBER: 0000830736-97-000023 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971105 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: BIOPOOL INTERNATIONAL INC CENTRAL INDEX KEY: 0000830736 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 581729436 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-17714 FILM NUMBER: 97708002 BUSINESS ADDRESS: STREET 1: 6025 NICOLLE ST SUITE A CITY: VENTURA STATE: CA ZIP: 93003 BUSINESS PHONE: 8056540643 MAIL ADDRESS: STREET 1: 6025 NICOLLE STREET CITY: VENTURA STATE: CA ZIP: 93003 FORMER COMPANY: FORMER CONFORMED NAME: CYTRX BIOPOOL LTD DATE OF NAME CHANGE: 19890716 10QSB 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------------------- FORM 10-QSB /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended September 30, 1997 ------------------------------ Commission file number 0-17714 ------------------------------- BIOPOOL INTERNATIONAL, INC. (Exact name of Registrant as specified in its charter) Delaware 58-1729436 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 6025 Nicolle Street, Ventura, (805) 654-0643 California 93003 (Registrant's telephone (Address of principal executive offices) number including area code) ------------------------------------- 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 proceeding 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. Outstanding at September 30, 1997, Common Stock, $.01 par value per share, 8,637,664 shares. PART I. FINANCIAL INFORMATION Item 1. FINANCIAL STATEMENTS BIOPOOL INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31, 1997 1996 (Unaudited) - ----------------------------------------------------------------------- (in thousands except share data) ASSETS Current assets Cash $ 1,226 $ 2,019 Accounts receivable, net 2,987 1,560 Inventories 4,198 2,027 Prepaid expenses and other current assets 248 289 - ----------------------------------------------------------------------- Total current assets 8,659 5,895 Property and equipment 6,719 3,661 Less accumulated depreciation (2,330) (2,018) - ----------------------------------------------------------------------- Property and equipment, net 4,389 1,643 Deposit on acquisition -- 4,500 Other assets 1,143 1,085 - ----------------------------------------------------------------------- TOTAL ASSETS $ 14,191 $ 13,123 - -----------------------------------------------------------------------
See accompanying notes to consolidated financial statements. BIOPOOL INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31, 1997 1996 (Unaudited) - ----------------------------------------------------------------------- (in thousands except share data) LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable and other payables $ 1,611 $ 988 Debt 964 972 - ----------------------------------------------------------------------- Total current liabilities 2,575 1,960 Long-term debt, net 2,173 2,811 Stockholders' equity: Common stock, $.01 par value, 50,000,000 shares authorized; 8,637,664 and 8,570,380 shares issued and outstanding in 1997 and 1996, respectively 86 86 Other stockholders' equity 9,357 8,266 - ----------------------------------------------------------------------- Total stockholders' equity 9,443 8,352 - ----------------------------------------------------------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 14,191 $ 13,123 - -----------------------------------------------------------------------
See accompanying notes to consolidated financial statements. BIOPOOL INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three Months Ending Nine Months Ending September 30, September 30, 1997 1996 1997 1996 - ----------------------------------------------------------------------- (in thousands except share data) Sales $ 4,315 $ 2,006 $12,661 $ 5,873 Costs and expenses Cost of sales 2,458 973 7,478 2,884 Selling, general, adminis- trative and other 1,197 720 3,506 1,949 Interest expense 75 16 238 52 - ----------------------------------------------------------------------- Income before taxes 585 297 1,439 988 Income tax (expense) benefit 92 (30) 286 (25) - ----------------------------------------------------------------------- Net income $ 493 $ 327 $ 1,153 $ 1,013 - ----------------------------------------------------------------------- Earnings per share: Primary $ 0.06 $ 0.04 $ 0.13 $ 0.13 Fully diluted $ 0.06 $ 0.04 $ 0.13 $ 0.13
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Nine Months Ending September 30, 1997 1996 - ----------------------------------------------------------------------- (in thousands) Operating activities $ 516 $ 712 Investing activities Acquisition of BCA (4,729) -- Other 4,128 (122) Financing activities (542) 20 Effect of exchange rates (166) 40 - ----------------------------------------------------------------------- Net increase (decrease) in cash $ (793) $ 650 - -----------------------------------------------------------------------
See accompanying notes to consolidated financial statements. BIOPOOL INTERNATIONAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Presentation The accompanying unaudited consolidated 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 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 nine-month period ended September 30, 1997, are not necessarily indicative of the results that may be expected for the year ended December 31, 1997. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-KSB for the year ended December 31, 1996. The balance sheet at December 31, 1996, has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. 2. Inventories
September 30, December 31, 1997 1996 (in thousands) ---------------------------- Raw materials $ 1,191 $ 448 Work in process 1,615 700 Finished products 1,392 879 ---------------------------- $ 4,198 $ 2,027
3. Acquisition On January 1, 1997, the Company acquired certain assets of the Blood Group Serology Division of Organon Teknika Corporation located in West Chester, Pennsylvania, for $4,500,000 in cash. Another $229,000 of costs associated with the acquisition were capitalized in the first nine months of 1997. The Company funded the acquisition, in part, from the privately placed sales of 500,000 shares of its Common Stock to a group of accredited investors and, in part, from the proceeds of a $3.5 million credit facility. The acquisition was accounted for as a purchase. The following unaudited data was prepared for analytical purposes only. Proforma consolidated operating results give effect as if the acquisition occurred January 1, 1996.
Nine Months Ended September 30, 1997 1996 ------------------------------- (in thousands except share data) Net sales $12,661 $11,844 Net income 1,153 1,201 Earnings per share $ 0.13 $ 0.14
4. Earnings per Share In February 1997, the Financial Accounting Standards Board issued Statement No. 128, Earnings per Share, which is required to be adopted on December 31, 1997. At that time, the Company will be required to change the method currently used to compute earnings per share and to restate all prior periods. Under the new requirements for calculating primary earnings per share, the dilutive effect of stock options will be excluded. The impact of Statement 128 on the calculation of fully diluted earnings per share for these periods is not expected to be material. BIOPOOL INTERNATIONAL, INC. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION & RESULTS OF OPERATIONS Acquisition of Blood Group Serology On January 1, 1997, the Company purchased certain assets of the Blood Group Serology Division (referred to as "BCA") of Organon Teknika Corporation for $4,500,000 in cash. This acquisition will have a significant impact on the Company's future operating results and financial condition. This acquisition has approximately doubled the number of employees of the Company and substantially increased the Company's sales. Results of Operations Sales increased by $2.3 million, or 115%, to $4.3 million for the three-month period and increased by $6.8 million, or 116%, to $12.7 million for the nine-month period ended September 30, 1997, compared with the corresponding periods of 1996. While the majority of the increases were due to the acquisition of BCA, sales from the core hemostasis business grew approximately 8% for the nine-month period as a result of the addition of a direct sales force and new distribution agreements. Costs of sales increased $1.5 million and $4.6 million for the 1997 periods compared with the respective 1996 periods. As a percentage of sales, year-to-date cost of sales increased to 59% in 1997 compared with 49% in 1996. The percentage increase in cost of sales was due almost entirely to the excess manufacturing capacity that currently exists at the Company's newly-acquired BCA facility in West Chester, Pennsylvania. Management intends to capitalize on this opportunity by attempting to grow market share of existing products and adding new, profitable product lines. Selling, general, administrative and other expenses increased by 68% and 78% for the third quarter and first nine months of 1997, respectively, compared with the same periods in 1996. The majority of these increases were due to the BCA acquisition. The Company also added management positions during 1996 in anticipation of ongoing internal growth and acquisition activities. Furthermore, significant transitional costs associated with the BCA acquisition and costs related to the installation of new computer hardware and software were incurred in the first half of the year. These transitional costs ended during the third quarter as anticipated. Interest expense for the nine months of 1997 increased $186,000 over the prior year period as a result of bank financing for the BCA acquisition. Income tax expense for the first nine months of 1997 includes a benefit related to utilization of domestic NOL carryforwards. It is anticipated that all NOL benefits will be utilized in 1997, which will have the effect of decreasing net income beginning the first quarter of 1998. Income tax expense for the 1996 periods was significantly lower than in 1997 due to the recognition of additional deferred tax benefits. Earnings per share were flat for the nine months of 1997 as compared to 1996, in spite of higher net income as a result of: (1) the issuance of 500,000 shares of Common Stock related to the purchase of BCA, and (2) relatively higher market prices for the Company's Common Stock, which had the effect of increasing the number of equivalent shares outstanding. Financial Condition The Company's liquidity and capital resources remained strong into the third quarter of 1997. Working capital as of September 30, 1997, was $6.1 million, with a current ratio of 3.4 to 1. Approximately $600,000 of the Company's cash was used to establish working capital for the BCA operations which were purchased without accounts receivables and payables. The total debt to equity ratio at September 30, 1997, was 33%, and $646,000 in principal was paid during the first nine months of 1997. The Company's management believes that the current availability of cash, lines of credit, working capital, and cash flow from operations are adequate to meet the Company's needs for at least the next twelve months. The Company continues to seek potential acquisitions and potential sources of capital to finance such acquisitions, although it has no commitments for either at this time. BIOPOOL INTERNATIONAL, INC. PART II. OTHER INFORMATION Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits (11) Statements regarding computation of earnings per share. (b) Reports on Form 8-K - None. 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. Date: November 5, 1997 BIOPOOL INTERNATIONAL, INC. ------------------- ----------------------------- (Registrant) /s/ Michael D. Bick, Ph.D. ----------------------------- Michael D. Bick, Ph.D. Chief Executive Officer and Chairman of the Board /s/ Robert K. Foote ----------------------------- Robert K. Foote Chief Financial Officer and Corporate Secretary EX-11 2 EXHIBIT 11 BIOPOOL INTERNATIONAL, INC. Statement Regarding Computation of Per Share Earnings Nine Months Ended September 30,
1997 1996 ------------------------- Primary Average shares outstanding 8,609 7,971 Net effect of dilutive stock options and warrants based on the treasury stock method using average market price 519 301 Total shares 9,128 8,272 Net income $1,153 $1,013 Per share amount $ 0.13 $ 0.12 Fully diluted Average shares outstanding 8,609 7,971 Net effect of dilutive stock options and warrants based on the treasury stock method using the higher of average or year-end market price 515 349 Total shares 9,124 8,320 Net income $1,153 $1,013 Per share amount $ 0.13 $ 0.12
EX-27 3
5 9-MOS DEC-31-1997 SEP-30-1997 1,226,000 0 2,987,000 0 4,198,000 8,659,000 6,719,000 2,330,000 14,191,000 2,575,000 0 0 0 86,000 9,357,000 14,191,000 12,661,000 12,661,000 7,478,000 10,984,000 0 0 238,000 1,439,000 286,000 1,153,000 0 0 0 1,153,000 0.13 0.13
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