-----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, TeZMGnumFbCjMLDgxGkK9WYLyIrpbz1CKCHueEYQqPikf3DVpzJj8Jem50ZoN0XO kqjOf8LQVX4sDKEtxwZNyQ== 0000864906-99-000005.txt : 19991117 0000864906-99-000005.hdr.sgml : 19991117 ACCESSION NUMBER: 0000864906-99-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LUNAR CORP CENTRAL INDEX KEY: 0000864906 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 391200501 STATE OF INCORPORATION: WI FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-18643 FILM NUMBER: 99756821 BUSINESS ADDRESS: STREET 1: 313 W BELTLINE HIGHWAY CITY: MADISON STATE: WI ZIP: 53713 BUSINESS PHONE: 6082742663 MAIL ADDRESS: STREET 1: 313 WEST BELTLINE HIGHWAY CITY: MADISON STATE: WI ZIP: 53713 10-Q 1 QUARTERLY REPORT FOR QUARTER ENDING 9/30/99 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1999 ------------------ OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 0-18643 LUNAR CORPORATION (Exact name of registrant as specified in its charter) Wisconsin 3845 39-1200501 (State of (Primary Standard Industry (IRS Employer Incorporation) Classification Code Number) Identification No.) 726 Heartland Trail Madison, Wisconsin 53717 608-828-2663 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) 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 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 ----- ----- As of October 31, 1999, 8,573,580 shares of the registrant's Common Stock, $0.01 par value, were outstanding. LUNAR CORPORATION AND SUBSIDIARIES FORM 10-Q For the quarterly period ended September 30, 1999 TABLE OF CONTENTS ----------------- PART I - FINANCIAL INFORMATION Page ---- Item 1. Financial statements Consolidated Balance Sheets September 30, 1999, and June 30, 1999...................3 Consolidated Statements of Income Three Months Ended September 30, 1999 and 1998................................................5 Consolidated Statements of Cash Flows Three Months Ended September 30, 1999 and 1998................................................6 Notes to Consolidated Financial Statements..............7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.....................9 Item 3. Quantitative and Qualitative Disclosures About Market Risk............................................12 PART II - OTHER INFORMATION......................................13 Item 1. Legal Proceedings......................................13 Item 2. Changes in Securities..................................13 Item 3. Defaults Upon Senior Securities........................13 Item 4. Submission of Matters to a Vote of Security Holders....13 Item 5. Other Information......................................13 Item 6. Exhibits and Reports on Form 8-K.......................14 SIGNATURES.......................................................15 EXHIBIT INDEX....................................................16 PART 1. FINANCIAL INFORMATION ITEM 1. Financial Statements LUNAR CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets - ---------------------------------------------------------------------- Assets - ---------------------------------------------------------------------- September 30, June 30, 1999 1999 (Unaudited) (Audited) - ---------------------------------------------------------------------- Current Assets: Cash and cash equivalents $ 13,231,666 $ 13,666,163 Marketable securities 5,986,118 4,311,834 Receivables: Trade, less allowance for doubtful accounts of $3,403,000 at September 30, 1999 and $3,524,000 at June 30, 1999 25,991,401 25,316,044 Short-term financed accounts receivable 4,995,403 4,848,186 Other 388,872 407,056 - ---------------------------------------------------------------------- 31,375,676 30,571,286 Inventories 12,367,178 13,655,779 Deferred Income Taxes 2,441,000 1,992,000 Other Current Assets 451,558 431,931 - ---------------------------------------------------------------------- Total Current Assets 65,853,196 64,628,993 Property, Plant and Equipment--At Cost: Land 2,088,118 2,088,118 Buildings and improvements 2,287,356 2,287,356 Furniture and fixtures 1,114,394 1,055,780 Machinery and other equipment 9,960,459 9,368,111 Construction in progress 8,926,099 6,787,950 - ---------------------------------------------------------------------- 24,376,426 21,587,315 Less Accumulated Depreciation and Amortization 6,986,094 6,354,858 - ---------------------------------------------------------------------- 17,390,332 15,232,457 Long-term Financed Accounts Receivable 4,090,911 4,488,753 Long-term Marketable Securities 8,962,636 11,233,298 Patents and Other Intangibles, Net of Accumulated Amortization of $639,000 at September 30, 1999 and $764,000 at June 30, 1999 459,918 463,270 Other 115,355 117,390 - ---------------------------------------------------------------------- $ 96,872,348 $ 96,164,161 ====================================================================== See accompanying notes to consolidated financial statements LUNAR CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets - ---------------------------------------------------------------------- Liabilities and Shareholders' Equity - ---------------------------------------------------------------------- September 30, June 30, 1999 1999 (Unaudited) (Audited) - ---------------------------------------------------------------------- Current Liabilities: Accounts payable $ 6,888,818 $ 9,133,277 Customer advances and deferred income 1,971,462 1,573,523 Income taxes payable 3,728,007 2,682,104 Accrued liabilities: Commissions payable 1,679,955 2,009,340 Compensation payable 1,093,228 658,821 Property, payroll, and other taxes 368,098 250,150 Accrued warranty and installation expenses 2,925,736 3,118,000 Other 321,486 393,537 - ---------------------------------------------------------------------- Total Current Liabilities 18,976,790 19,818,752 Shareholders' Equity: Common stock--authorized 25,000,000 shares of $.01 par value; issued and outstanding 8,598,580 shares at September 30, 1999 and June 30, 1999 85,986 85,986 Capital in excess of par value 23,454,316 23,454,316 Retained Earnings 54,471,568 52,922,982 Accumulated Other Comprehensive Income (116,312) (117,875) - ---------------------------------------------------------------------- 77,895,558 76,345,409 - ---------------------------------------------------------------------- $ 96,872,348 $ 96,164,161 ====================================================================== See accompanying notes to consolidated financial statements LUNAR CORPORATION AND SUBSIDIARIES Consolidated Statements of Income (Unaudited) - ---------------------------------------------------------------------- Three months ended September 30, September 30, 1999 1998 - ---------------------------------------------------------------------- Revenues $ 22,913,013 $ 22,824,543 - ---------------------------------------------------------------------- Operating Expenses Cost of sales 13,416,345 12,221,926 Research and development 1,649,553 2,046,620 Selling and marketing 5,306,361 5,693,407 General and administrative 1,013,298 1,093,790 - ---------------------------------------------------------------------- 21,385,557 21,055,743 - ---------------------------------------------------------------------- Income from Operations 1,527,456 1,768,800 - ---------------------------------------------------------------------- Other Income (Expense): Interest income 495,470 346,666 Settlement of lawsuit 0 (579,555) Other 189,660 88,634 - ---------------------------------------------------------------------- 685,130 (144,255) - ---------------------------------------------------------------------- Income Before Income Taxes 2,212,586 1,624,545 Income Tax Expense 664,000 470,000 - ---------------------------------------------------------------------- Net Income $ 1,548,586 $ 1,154,545 ====================================================================== Basic Earnings per Share $0.18 $0.13 ====================================================================== Diluted Earnings per Share $0.18 $0.13 ====================================================================== Weighted Average Number of Common Shares 8,598,580 8,658,945 ====================================================================== Weighted Average Number of Common and Dilutive Potential Common Shares 8,768,507 8,873,912 ====================================================================== See accompanying notes to consolidated financial statements LUNAR CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) - ---------------------------------------------------------------------- Three months ended September 30, September 30, 1999 1998 - ---------------------------------------------------------------------- Cash Flows from Operating Activities: Net income $1,548,586 $1,154,545 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 723,318 845,444 Deferred income taxes (449,000) (150,000) Changes in assets and liabilities: Receivables (404,513) (6,016,843) Inventories 1,288,601 (1,026,015) Other current assets (19,627) (310,692) Accounts payable (2,202,600) 2,063,815 Customer advances and deferred income 397,939 44,845 Accrued liabilities (41,345) 964,849 Income taxes payable 1,045,903 (281,733) - ---------------------------------------------------------------------- Net Cash Provided by (Used in) Operating Activities 1,887,262 (2,711,785) - ---------------------------------------------------------------------- Cash Flows from Investing Activities: Sales and maturities of marketable securities 500,000 6,206,095 Additions to property, plant and equipment (2,789,111) (1,485,990) Additions to patents and other intangibles (32,648) (19,647) - ---------------------------------------------------------------------- Net Cash Provided by (Used in) Investing Activities (2,321,759) 4,700,458 - ---------------------------------------------------------------------- Cash Flows from Financing Activities: Proceeds from exercise of stock options 0 20,830 Income tax benefit from stock option exercises 0 3,866 Repurchase of common stock 0 (1,436,600) - ---------------------------------------------------------------------- Net Cash Provided by (Used in) Financing Activities 0 (1,411,904) - ---------------------------------------------------------------------- Net Increase (Decrease) in Cash and Cash Equivalents (434,497) 576,769 Cash and Cash Equivalents at Beginning of Period 13,666,163 4,608,427 - ---------------------------------------------------------------------- Cash and Cash Equivalents at End of Period $13,231,666 $5,185,196 ====================================================================== Supplemental Disclosure of Cash Flow Information: Income taxes paid 37,000 917,000 ====================================================================== See accompanying notes to consolidated financial statements LUNAR CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (1) BASIS OF PRESENTATION The consolidated financial statements of Lunar Corporation presented herein, without audit except for balance sheet information at June 30, 1999, have been prepared pursuant to the rules of the Securities and Exchange Commission for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles. These statements should be read in conjunction with the consolidated financial statements and notes thereto included in Lunar's Annual Report on Form 10-K for the year ended June 30, 1999. The consolidated balance sheet as of September 30, 1999, the consolidated statements of income for the three months ended September 30, 1999 and 1998, and the consolidated statements of cash flows for the three months ended September 30, 1999 and 1998 are unaudited but, in the opinion of management, include all adjustments (consisting of normal, recurring adjustments) necessary for a fair presentation of results for these interim periods. Lunar has reclassified the presentation of certain prior year information to conform with the current presentation format. The results of operations for the three months ended September 30, 1999, are not necessarily indicative of the results to be expected for the entire fiscal year ending June 30, 2000. (2) INVENTORIES Inventories are stated at the lower of cost or market; cost is determined principally by the first-in, first-out method. Inventories are broken down as follows: - ---------------------------------------------------------------------- September 30, June 30, 1999 1999 (Unaudited) (Audited) - ---------------------------------------------------------------------- Finished goods and work in process $ 6,418,395 $ 7,125,027 Materials and purchased parts 5,948,783 6,530,752 ----------- ----------- $12,367,178 $13,655,779 =========== =========== (3) SHAREHOLDERS' EQUITY On April 22, 1997, Lunar approved a stock repurchase program pursuant to which it may repurchase up to 1,000,000 shares of its common stock from time to time based upon market conditions and other factors. Lunar has repurchased 339,400 shares under this program as of October 31, 1999. (4) EARNINGS PER SHARE The difference between the weighted average number of common shares and the weighted average number of common and dilutive potential common shares is due to the effect of dilutive stock options. (5) COMPREHENSIVE INCOME (LOSS) Effective July 1, 1998, Lunar adopted Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive Income" which establishes standards to report and display comprehensive income and its components in a full set of general purpose financial statements. Lunar's comprehensive income was as follows: Three Months Ended September 30, 1999 1998 ----------- ------------ Net Income $1,548,586 $1,154,545 Other Comprehensive Income: Unrealized adjustment in marketable securities (40,296) 31,710 Foreign currency translation Adjustments 41,859 40,423 ----------- ------------ Comprehensive income $1,550,149 $1,226,678 =========== ============ (6) SETTLEMENT OF LAWSUIT Lunar settled a lawsuit with Osteometer Meditech A/S and Rapiscan Security Systems Inc. during the quarter ended September 30, 1998. Lunar incurred expenses of $579,555 in the quarter ended September 30, 1998 comprised of legal expenses, a settlement payment, and a patent write-off related to this settlement. Item 2. Management's Discussion and Analysis of Financial Condition and --------------------------------------------------------------- Results of Operations --------------------- Results of Operations - --------------------- Equipment sales and other revenue increased slightly to $22,913,000 in the three months ended September 30, 1999 from $22,825,000 in the three months ended September 30, 1998. Sales by product line are summarized as follows: Revenues by Product (in thousands) Three Months Ended --------------------------- September 30, September 30, 1999 1998 ------------- ------------- X-ray densitometry $12,013 $15,385 Ultrasound densitometry 3,104 1,415 Orthopedic Imaging 5,205 4,080 Service Revenue 2,046 1,691 Other 545 254 --------- -------- $22,913 $22,825 ========= ======== X-ray densitometry sales in the three months ended September 30, 1999 were lower compared to the prior year as a result of a decrease in the number of units sold. Average selling prices were also lower due to competitive pricing pressures. The increase in ultrasound densitometry revenue is primarily due to the introduction of the Achilles Express in May 1999. The increase in Orthopedic Imaging sales for the current fiscal year is primarily due to increased unit sales of the E-Scan dedicated MRI system. The increase in service revenue is attributable to a growing installed base of densitometers in the United States. Cost of sales as a percentage of equipment sales averaged approximately 59% in the three months ended September 30, 1999, compared to 54% in the three months ended September 30, 1998. These lower margins primarily result from a decrease in densitometry average selling prices and a higher mix of orthopedic imaging equipment sales which have lower gross profit margins. Research and development expenditures decreased to $1,650,000 in the three months ended September 30, 1999 from $2,047,000 in the three months ended September 30, 1998. These expenses were lower in the quarter ended September 30, 1999 due to the completion of development work associated with the Prodigy and Achilles Express bone densitometers. Lunar expects this trend to continue and plans to spend less on research and development in this fiscal year. Selling and marketing expenses were $5,306,000 in the three months ended September 30, 1999, compared to $5,693,000 in the three months ended September 30, 1998, representing a decrease to 23% from 25% as a percentage of equipment sales. This decrease is primarily attributable to lower marketing expenses. General and administration expenses decreased to $1,013,000 in the three months ended September 30, 1999 from $1,094,000 in the three months ended September 30, 1998. In May 1999 Lunar sold the assets of Bona Fide, Ltd. This sale resulted in lower general and administrative expenses. Interest income was $495,000 in the three months ended September 30, 1999, compared to $347,000 in the three months ended September 30, 1998. The increase is due to improved collection experience on interest associated with financed receivables. The effective tax rate averaged 30% in the three months ended September 30, 1999, compared to 29% in the three months ended September 30, 1998. The rate for the three months ended September 30, 1999 and September 30, 1998 is below the 34% federal statutory rate as a result of tax-exempt interest income and the tax benefit of the foreign sales corporation offset by the provision for state income taxes. Liquidity and Capital Resources - ------------------------------- Cash and cash equivalents decreased $434,000 to $13,232,000 in the three months ended September 30, 1999. Lunar has a $14,949,000 laddered portfolio of high-grade, readily marketable municipal bonds with various maturities not exceeding 48 months. Lunar's trade accounts receivable increased $407,000 to $35,467,000 at September 30, 1999 from $35,060,000 at June 30, 1999. This increase is primarily attributable to higher sales for the quarter ended September 30, 1999 as compared to the quarter ended June 30, 1999 offset by a reduction in financed Brazilian accounts receivable. Lunar has financed the sale of its equipment to Brazilian customers for more than eight years and has approximately $7,816,000 in outstanding receivables from Brazilian customers as of September 30, 1999. During fiscal years 1998 and 1997 Lunar sold approximately $15,000,000 of Brazilian accounts receivable to two finance companies of which approximately $3,651,000 is outstanding as of September 30, 1999. The two finance companies have recourse against Lunar for a maximum of $1,395,000 for these receivables. All of the Brazilian accounts receivable are denominated in U.S. dollars. In January 1999 the Brazilian government allowed its currency, the real, to freely trade against the U.S. dollar. As of November 1999, this policy change resulted in a 59% devaluation of the real as compared to the U.S. dollar. Lunar has incurred some payment delays from Brazilian customers and lower sales in Brazil as a result of this devaluation. Lunar has renegotiated longer payment terms for a majority of these Brazilian customers. As a result, collection activities have recently improved and total financed Brazilian accounts receivable have declined to $7,816,000 from $8,091,000 at June 30, 1999. Inventories decreased 9% to $12,367,000 at September 30, 1999 from $13,656,000 at June 30, 1999. This decrease is a result of management's focus on reducing inventory levels. Management expects inventory levels to decline further during fiscal year 2000. Lunar purchased a 25-acre parcel of land in January 1998 for $1,949,000 and began construction of an assembly, warehouse, and office building in October 1998. Lunar projects total construction costs will be approximately $9,600,000, of which $8,926,099 had been paid as of September 30, 1999. Lunar moved its assembly operations and warehouse to the new building in July 1999 and moved its office personnel in October 1999. Lunar does not have any other pending material commitments for capital expenditures. Lunar has received a commitment from the State of Wisconsin Investment Board to provide a 20 year term loan for up to $10,000,000. The loan will be used to replenish Lunar's cash balances used to construct the new office building. The interest rate will be fixed at the time the loan proceeds are paid. Management believes the current level of cash and short-term investments is adequate to finance Lunar's operations for the foreseeable future. New Accounting Pronouncements - ----------------------------- SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities" is effective for financial statements for periods beginning after June 15, 2000. SFAS No. 133 establishes accounting and reporting standards for derivative instruments and hedging activities. Lunar does not expect this statement to have a material effect on its financial statements. Year 2000 Compliance - -------------------- Many currently installed computer systems and software products are coded to accept only two-digit entries in the date code field. To distinguish 21st century from 20th century dates, these date code fields must be able to accept four-digit entries. Lunar has reviewed its existing financial and other business information systems and believes that its computer systems will be able to manage and manipulate all material data involving the transition from 1999 to 2000 without functional or data abnormality and without inaccurate results related to such data. Lunar replaced its manufacturing and financial accounting software package during fiscal 1998 at a cost of approximately $230,000. This new software package is year 2000 compliant. Lunar does not expect to incur significant additional costs to complete its year 2000 compliance program. It is possible that third parties, such as suppliers and distributors, may have noncompliant computer systems or programs, which may not interface properly with Lunar's computer systems or may otherwise result in a disruption of Lunar's operations. Lunar has received assurances from third parties with which it has a material relationship that their computers, systems, and programs are year 2000 compliant. Lunar currently anticipates that the expenses and capital expenditures associated with its year 2000 compliance program will not have a material effect on its financial position, results of operations or cash flows. Because Lunar's software programs are year 2000 compliant, and Lunar does not believe any material problems will arise if a third party is not year 2000 compliant, Lunar has not developed any contingency plan. Item 3. Quantitative and Qualitative Disclosure About Market Risk --------------------------------------------------------- Lunar's exposure to market risk for changes in interest rates relate primarily to the Lunar's investment portfolio. Lunar does not use derivative financial instruments in its investment portfolio. Lunar places its investments with high credit quality issuers and, by policy, limits the amount of credit exposure to any one issuer. As stated in its policy, Lunar is adverse to principal loss and ensures the safety and preservation of its invested funds by limiting default risk, market risk, and reinvestment risk. Lunar mitigates default risk by investing in only high credit quality securities. The portfolio includes only marketable securities with active secondary or resale markets to ensure portfolio liquidity. All investments mature, by policy, in 48 months or less. Lunar uses forward currency contracts in its management of foreign currency exposures. The contracts are in German Deutsche Marks, French Francs and Belgium Francs and generally have maturities which do not exceed three months. Realized gains and losses on such contracts are included in other income at the time the hedged transaction occurs. There were no deferred gains or losses at September 30, 1999. These contracts are entered into with major financial institutions thereby minimizing the risk of credit loss. The table below provides information about the Lunar's market sensitive financial instruments and constitutes a "forward-looking statement." All items described below are non-trading and are stated in U.S. dollars. During fiscal year ended June 30, --------------------------------- Maturity Dates 2000 2001 2002 - --------------------------------------------------------------------------- ASSETS Cash Equivalents Variable taxable rate $7,132,716 Average taxable interest rate 4.40% Variable tax-exempt rate $6,098,950 Average tax-exempt rate 3.23% Marketable securities Fixed tax-exempt rate $3,741,900 $7,663,600 $3,245,000 Average tax-exempt rate 4.28% 4.23% 4.19% Forward contract German DM denominated $ 954,511 Contracted exchange rate 1.8334:1 (DM to US$) French Franc denominated $2,535,143 Contracted exchange rate 6.1535:1 (FF to US$) Belgium Franc denominated $ 422,610 Contracted exchange rate 37.86:1 (BF to US$) PART II - OTHER INFORMATION LUNAR CORPORATION AND SUBSIDIARIES Item 1. Legal Proceedings On May 21, 1998 Lunar filed suit against International Medical Research Ottawa ("IMRO") for infringement of Lunar's Canadian patent number 1,323,090 (the `090 patent). IMRO manufactures and sells ultrasound bone densitometers in Canada and has manufactured ultrasound densitometers for Norland Medical Systems, Inc. for distribution and sales throughout the world. This suit is pending in the Federal Court of Canada-Trial Division. On September 10, 1999, the parties reached an agreement in principle to resolve this litigation. Under the terms of the agreement, IMRO will terminate its operations in Canada within three months and pay Lunar a royalty for each system manufactured or sold during that period. On November 24, 1998 Lunar was issued U.S. patent number 5, 841,832 (the `832 patent). On January 20, 1999 Lunar brought suit against EG&G Astrophysics Research Corporation and its parent company EG&G, Inc. (collectively referred to as ("EG&G") in the United States District Court for the Western District of Wisconsin for infringement of the `832 patent by EG&G's dual-energy baggage scanners. The parties have reached an agreement to resolve this litigation. Under the terms of the agreement, EG&G will pay future royalties to Lunar for all sales of products that utilize the technology claimed in the `832 patent. Other Matters: Lunar is a defendant from time to time in actions arising out of its ordinary business operations. There are no other legal proceedings known to Lunar at this time, which it believes, would likely have a material adverse impact on the results of operations, financial condition or cash flows of Lunar. To Lunar's knowledge, there are no material legal proceedings to which any director, officer, affiliate or more than 5% shareholder of Lunar (or any associate of the foregoing persons) is a party adverse to Lunar or any of its subsidiaries or has a material interest adverse to Lunar. Item 2. Changes in Securities None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information Safe Harbor for Forward-Looking Statements: In addition to the historical information presented in this quarterly report, Lunar has made and will make certain forward-looking statements in this report, other reports filed by Lunar with the Securities and Exchange Commission, reports to stockholders and in certain other contexts relating to future net sales, costs of sales, other expenses, profitability, financial resources, or products and production schedules. Statements relating to the foregoing or that predict or indicate future events and trends and which do not relate solely to historical matters identify forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are based on management's beliefs as well as assumptions made by and information currently available to management. Accordingly, Lunar's actual results may differ materially from those expressed or implied in such forward-looking statements due to known and unknown risks and uncertainties that exist in Lunar's operations and business environment, including, among other factors, technical risks associated with the development of new products, regulatory policies in the United States and other countries, reimbursement policies of public and private health care payors, introduction and acceptance of new drug therapies, competition from existing products and from new products or technologies, the failure by Lunar to produce anticipated cost savings or improve productivity, the timing and magnitude of capital expenditures and acquisitions, currency exchange risks, economic and market conditions in the United States, Europe and the rest of the world, changes in customer spending levels, the cost and availability of raw materials, and other risks associated with Lunar's operations. Although Lunar believes that its forward-looking statements are based on reasonable assumptions, there can be no assurance that actual results, performance or achievements will not differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. Lunar disclaims any obligation to update any such factors or to publicly announce any revisions to any of the forward-looking statements contained herein to reflect future events or developments. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits furnished: (27.1) Financial Data Schedule, September 30, 1999 (27.2) Financial Data Schedule, September 30, 1998 (b) Reports on Form 8-K No reports on Form 8-K were filed by Lunar during the quarter ended September 30, 1999. 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. LUNAR CORPORATION (Registrant) Date: November 11, 1999 /s/ Richard B. Mazess - ----------------------- ------------------------- Richard B. Mazess President (Principal Executive Officer) Date: November 11, 1999 /s/ Robert A. Beckman - ----------------------- ------------------------ Robert A. Beckman Vice President of Finance and Treasurer (Principal Financial and Accounting Officer) LUNAR CORPORATION AND SUBSIDIARIES Exhibit Index For the Quarterly Period Ended September 30, 1999 No. Description - --- ----------- 27.1 Financial Data Schedule, September 30, 1999 27.2 Financial Data Schedule, September 30, 1998 EX-27.1 2 ART. 5 FDS FOR 1ST QUARTER 10-Q
5 This schedule contains summary financial information extracted from Form 10-Q for the three months ended September 30, 1999, and is qualified in its entirety by reference to such financial statements. 1,000 3-MOS JUN-30-2000 SEP-30-1999 13,232 14,949 38,870 3,403 12,367 65,853 24,376 6,986 96,872 18,977 0 86 0 0 77,809 96,872 22,913 22,913 13,416 21,386 (190) 0 0 2,213 664 1,549 0 0 0 1,549 .18 .18
EX-27.2 3 ART. 5 FDS FOR 1ST QUARTER 10-Q
5 This schedule contains summary financial information extracted from Form 10-Q for the three months ended September 30, 1998, and is qualified in its entirety by reference to such financial statements. 1,000 3-MOS JUN-30-1999 SEP-30-1998 5,185 24,609 40,671 3,221 14,189 62,609 13,627 5,546 92,681 17,255 0 86 0 0 75,340 92,681 22,825 22,825 12,222 21,056 491 0 0 1,625 470 1,155 0 0 0 1,155 .13 .13
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