-----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, Kve0jt16pL8ERSMFL7jaaVHtmffj6XNXEbQxzqGYDwTCwUVsqezJMRupxFulMd+1 78ZVNNjK6sUUEBRl84k4BA== 0000830736-99-000024.txt : 19991117 0000830736-99-000024.hdr.sgml : 19991117 ACCESSION NUMBER: 0000830736-99-000024 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991115 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: 001-14257 FILM NUMBER: 99752885 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 3RD QUARTER 99 10QSB ================================================================================ 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, 1999 ---------------------------- 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, CALIFORNIA 93003 (805) 654-0643 (Address of principal executive offices) (Registrant's telephone 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, 1999, Common Stock, $.01 par value per share, 8,286,986 shares. ================================================================================ PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS BIOPOOL INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
SEPTEMBER 30, DECEMBER 31, 1999 1998 - -------------------------------------------------------------------------------- (in thousands except share data) ASSETS CURRENT ASSETS Cash ................................... $ 2,809 $ 941 Accounts receivable, net ............... 1,386 1,332 Inventories ............................ 2,103 1,961 Prepaid expenses and other current assets ....................... 249 320 - ------------------------------------------------------------------------------- TOTAL CURRENT ASSETS ........................ 6,547 4,554 PROPERTY AND EQUIPMENT ...................... 3,591 3,437 Less accumulated depreciation .......... (2,558) (2,235) - ------------------------------------------------------------------------------- PROPERTY AND EQUIPMENT, NET ................. 1,033 1,202 NET ASSETS OF DISCONTINUED OPERATIONS ....... 2,258 3,274 OTHER ASSETS ................................ 1,170 1,440 - ------------------------------------------------------------------------------- TOTAL ASSETS ................................ $ 11,008 $ 10,470 =============================================================================== LIABILITIES AND STOCKHOLDERS' EQUITY TOTAL CURRENT LIABILITIES ................... $ 1,192 $ 1,005 DEFERRED TAX LIABILITY ...................... 122 108 STOCKHOLDERS' EQUITY: Common stock, $.01 par value, 50,000,000 shares authorized; 8,286,986 and 8,540,886 shares issued and outstanding in 1999 and 1998, respectively ............... 83 85 Other stockholders' equity ............. 9,611 9,272 - ------------------------------------------------------------------------------- TOTAL STOCKHOLDERS' EQUITY .................. 9,694 9,357 - ------------------------------------------------------------------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .. $ 11,008 $ 10,470 ===============================================================================
See accompanying notes to consolidated financial statements. 2 BIOPOOL INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
THREE MONTHS ENDING NINE MONTHS ENDING SEPTEMBER 30, SEPTEMBER 30, 1999 1998 1999 1998 - -------------------------------------------------------------------------------- (in thousands except per share data) SALES ................................ $ 1,984 $ 1,736 $ 6,476 $ 5,906 COSTS AND OTHER (INCOME) EXPENSES Cost of sales ................... 962 827 3,254 2,832 Selling, general, administrative 807 769 2,282 2,099 Research and development ........ 48 55 241 235 Other, net....................... 49 24 113 180 - -------------------------------------------------------------------------------- INCOME FROM CONTINUING OPERATIONS BEFORE TAXES .................... 118 61 586 560 INCOME TAX EXPENSE ................... 41 9 231 136 - -------------------------------------------------------------------------------- INCOME FROM CONTINUING OPERATIONS .... 77 52 355 424 INCOME (LOSS) FROM DISCONTINUED OPERATIONS - NET OF INCOME TAX EFFECT ...................... -- (9) 23 (54) GAIN ON DISPOSAL-NET OF INCOME TAX ... -- -- 199 -- - -------------------------------------------------------------------------------- NET INCOME ........................... $ 77 $ 43 $ 577 $ 370 ================================================================================ WEIGHTED AVERAGE SHARES OUTSTANDING Basic ........................... 8,287 8,639 8,404 8,667 Effect of dilutive shares ....... 21 11 23 178 --------------------------------------- Diluted ......................... 8,308 8,650 8,427 8,845 BASIC AND DILUTED EARNINGS PER SHARE Continuing operations ........... $ 0.01 $ -- $ 0.04 $ 0.05 Discontinued operations ......... -- -- 0.03 (0.01) --------------------------------------- Net income ...................... $ 0.01 $ -- $ 0.07 $ 0.04 =======================================
See accompanying notes to consolidated financial statements. 3 BIOPOOL INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
NINE MONTHS ENDING SEPTEMBER 30, 1999 1998 - -------------------------------------------------------------------------------- (in thousands) OPERATING ACTIVITIES ....................... $ 1,271 $ 599 INVESTING ACTIVITIES ....................... 837 (206) FINANCING ACTIVITIES ....................... (212) (736) EFFECT OF EXCHANGE RATES ................... (28) (23) - -------------------------------------------------------------------------------- NET INCREASE (DECREASE) IN CASH ............ $ 1,868 $ (366) ================================================================================
See accompanying notes to consolidated financial statements. 4 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, 1999, are not necessarily indicative of the results that may be expected for the year ended December 31, 1999. 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, 1998. The balance sheet at December 31, 1998, 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. Financial information presented to the notes to the consolidated financial statements excludes discontinued operations except where noted.
2. INVENTORIES SEPTEMBER 30, DECEMBER 31, 1999 1998 ----------------------------------- (in thousands) Raw materials $ 654 $ 580 Work in process 679 679 Finished products 769 702 ----------------------------------- $ 2,103 $ 1,961 ===================================
3. EARNINGS PER SHARE During the year ended December 31, 1998, the Company adopted SFAS No. 128, "Earnings Per Share," which required a change in the method used to compute earnings per share. Under this new standard, primary and fully diluted earnings per share were replaced with "Basic" and "Diluted" earnings per share. Basic earnings per share is based upon the weighted-average number of common shares outstanding. Diluted earnings per share is based upon the weighted average number of common shares and dilutive potential common shares outstanding. Potential common shares are outstanding options under the Company's stock option plans and outstanding warrants, which are included under the treasury stock method. 4. COMPREHENSIVE INCOME SFAS No. 130 requires unrealized gains and losses on the Company's foreign currency translation adjustments to be included in other comprehensive income. Total comprehensive income was $549,000 and $347,000 for the nine months and $134,000 and $42,000 for the three months ended September 30, 1999 and 1998, respectively. 5 5. SEGMENT INFORMATION The Company currently operates in one industry, in vitro diagnostic medical products. However, the Company has two reportable segments; Biopool International and its wholly-owned operating subsidiary, Biopool Sweden. The reportable segments are each managed separately as "stand-alone" business units and have very little duplication of technical or manufacturing processes. Biopool International manufactures hemostasis and drugs-of-abuse products, and Biopool Sweden primarily manufactures test kits for assessing the blood's fibrinolytic (clot dissolving) system.
INTER- BIOPOOL COMPANY INTERNA- BIOPOOL ELIMINA- CONSOLI- TIONAL SWEDEN TIONS DATED - -------------------------------------------------------------------------------- (in thousands) NINE MONTHS ENDED SEPTEMBER 30, 1999 Sales ....................... $ 5,107 $ 2,263 $ (894) $ 6,476 Less intercompany ........... (333) (561) 894 -- ------- ------- ------- ------- Sales to unafilliated customers ................. 4,774 1,702 -- 6,476 Pre-tax income from continuing operations ..... 367 219 -- 586 - -------------------------------------------------------------------------------- NINE MONTHS ENDED SEPTEMBER 30, 1998 Sales ....................... 4,531 2,081 (706) 5,906 Less intercompany ........... (321) (385) 706 -- ------ ------ ------ ------ Sales to unaffiliated customers ................. 4,210 1,696 -- 5,906 Pre-tax income from continuing operations ..... 223 337 -- 560 - --------------------------------------------------------------------------------
6. DISCONTINUED OPERATIONS On April 30, 1999, the Company consummated the sale of certain business assets of the Blood Group Serology Division (BCA) for $4.45 million in cash, subject to future adjustments. BCA ceased operations to the Company's benefit effective May 1, 1999, but continued to convert certain inventory items on behalf of the buyer.
THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, 1998 SEPTEMBER 30, 1998 - -------------------------------------------------------------------------------- (in thousands) SALES AS PREVIOUSLY REPORTED .......... $ 3,516 $11,235 Less BCA sales ................... 1,780 5,329 - -------------------------------------------------------------------------------- AS REPORTED SEPTEMBER 30, 1999 ........ $ 1,736 $ 5,906 ================================================================================
7. RECLASSIFICATION Certain data in the prior year consolidated financial statements have been reclassified to conform to the 1999 presentation. 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION SALE OF BLOOD GROUP SEROLOGY DIVISION On April 30, 1999, we consummated the sale of certain business assets of BCA for $4.45 million in cash. BCA ceased operations to our benefit effective May 1, 1999, but continued to convert certain inventory items on behalf of the buyer through June 30, 1999. The Consolidated Statements of Operations have been restated to reflect ongoing hemostasis operations. The sale of BCA will reduce the Company's future sales by approximately 50%; however, the impact on future net income will be negligible. RESULTS OF OPERATIONS Sales from continuing operations were $2.0 million for the three-month period and $6.5 million for the nine-month period ended September 30, 1999, compared with $1.7 million and $5.9 million for the corresponding periods of 1998. The 1999 sales represent increases of 14 and 10 percent, respectively, over the 1998 periods. These increases are the result of renewed emphasis to market our core hemostasis products. Cost of goods sold was $962,000 for the three months and $3,254,000 for the nine months ended September 30, 1999, compared with $827,000 and $2,832,000 for the same periods in 1998. The year-to-date cost of sales as a percentage of revenues was 50% in 1999 versus 48% in 1998. This percentage increase is a result of increasing our allocation of overhead to cost of sales in 1999. Selling, general and administrative ("SG&A") expenses were $807,000 and $2,282,000 for the three months and nine months ended September 30, 1999, compared with $769,000 and $2,099,000 for the same periods of 1998. These increases were due entirely to increased sales and marketing efforts to improve sales of our hemostasis products. The 1999 Other expenses primarily relate to costs incurred to move our Swedish operations (Biopool Sweden) into larger facilities and the abandonment of existing leasehold improvements at their current facilities. In 1998, restructure costs were incurred in conjunction with the closure of our Canadian operations. FINANCIAL CONDITION Our already strong liquidity and capital resources were further enhanced by the sale of BCA. As of September 30, 1999, working capital was $5.4 million, with a current ratio of 5.5 to 1.0. On April 30, 1999, we received $4.45 million cash for the sale of certain BCA assets. The proceeds were used, in part, to pay off the term note ($1,762,000) and pay certain closing costs (approximately $775,000), with the balance invested in a short-term certificate of deposit. Net assets of discontinued operations, equal to $2.3 million, represent the BCA property, plant, and equipment, which were placed for sale in June 1999. The saleability and ultimate net proceeds from the sale of such assets are unknown at this time. YEAR 2000 READINESS We have formulated and are implementing a Year 2000 Readiness Plan. Phase I of this Plan, assessment and identification of potential issues, is complete. Based upon our current assessment, we believe that we should not experience any material Year 2000 problems with either our own or any third party systems. Phase II of the Plan consists of remediation efforts, which will be completed by November 30, 1999. To date, we have spent an immaterial amount on our compliance program and do not expect to spend in excess of $20,000 to complete Phase II. 7 We are unable, at this time, to fully assess our reasonably likely "worst case" scenario. However, failures to correct Year 2000 systems, our own, certain key distributors or certain key vendors, could result in failures or interruptions of critical business systems which could possibly have a material impact to our liquidity and financial condition. We do not anticipate material problems with our power supply or telecommunications systems. FORWARD LOOKING STATEMENTS Except for the historical information contained herein, this report contains forward-looking statements (identified by the words "estimate," "anticipate," "expect," "believe," and similar expressions) which are based upon management's current expectations and speak only as of the date made. These forward-looking statements are subject to risks, uncertainties and factors that could cause actual results to differ materially from the results anticipated in the forward-looking statements and include, but are not limited to, competitors' pricing strategies and technological innovations, changes in health care and government regulations, litigation claims, foreign currency fluctuation, product acceptance, Year 2000 issues, as well as other factors discussed in the Company's last Report on Form 10-KSB. 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 - None (b) Reports on Form 8-K - None 8 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 15, 1999 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 9 EX-27 2 FDS 09/30/99
5 1,000 9-MOS DEC-31-1999 SEP-30-1999 2,809 0 1,386 0 2,103 6,547 3,591 2,558 11,008 1,192 0 0 0 83 9,611 11,008 6,476 6,476 3,254 5,777 113 0 0 586 231 355 222 0 0 577 0.07 0.07
EX-27 3 RESTATED FDS 09/30/98
5 1,000 9-MOS DEC-31-1998 SEP-30-1998 1,010 0 1,470 (31) 1,855 4,636 3,625 (2,319) 10,405 936 0 0 0 86 9,275 10,405 5,906 5,906 2,832 5,166 180 0 0 560 136 424 (54) 0 0 370 0.04 0.04
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