-----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, EmsKniFak4tabOLFGXqZ6HIjrS93eqfn+oxPL1enKdCEcFapPFR8zdhRl95LJr1t VPBvsfraYG+ij30meazRRw== 0000950147-03-000532.txt : 20030429 0000950147-03-000532.hdr.sgml : 20030429 20030429101336 ACCESSION NUMBER: 0000950147-03-000532 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030429 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ORTHOLOGIC CORP CENTRAL INDEX KEY: 0000887151 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 860585310 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21214 FILM NUMBER: 03668023 BUSINESS ADDRESS: STREET 1: 1275 WEST WASHINGTON STREET CITY: TEMPE STATE: AZ ZIP: 85281 BUSINESS PHONE: 6024375520 MAIL ADDRESS: STREET 1: 1275 WEST WASHINGTON STREET CITY: TEMPE STATE: AZ ZIP: 85281 8-K 1 e-9910.txt CURRENT REPORT DATED 04/29/2003 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 29, 2003 ORTHOLOGIC CORP. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation) 000-21214 86-0585310 (Commission File Number) (IRS Employer Identification Number) 1275 West Washington Street, Tempe, Arizona 85281 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (602) 286-5520 Not Applicable (Former name or former address, if changed since last report) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) EXHIBITS EXHIBIT NO. DESCRIPTION - ----------- ----------- 99.1 Press release, dated April 29, 2003, issued by Orthologic Corp. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On April 29, 2003, Orthologic Corp. issued a press release announcing its financial results for the fiscal quarter ended March 31, 2003. A copy of the press release is attached as Exhibit 99.1 to this report. 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 hereunto duly authorized. Dated: April 29, 2003 ORTHOLOGIC CORP. /s/ Thomas Trotter ---------------------------------------- Thomas Trotter Chief Executive Officer INDEX TO EXHIBITS EXHIBIT NO. DESCRIPTION - ----------- ----------- 99.1 Press release, dated April 29, 2003, issued by Orthologic Corp. EX-99.1 3 ex99-1.txt PRESS RELEASE DATED 04/29/2003 EXHIBIT 99.1 NEWS | RE: ORTHOLOGIC CORP. BULLETIN | 1275 W. WASHINGTON ST. FROM: [LOGO] BGIR | TEMPE, AZ 85281 | (602) 286-5520 | www.orthologic.com | TRADED: NASDAQ: OLGC - -------------------------------------------------------------------------------- THE BERLIN GROUP, INC. INVESTOR RELATIONS COUNSEL FOR FURTHER INFORMATION: AT THE COMPANY: AT THE BERLIN GROUP: THOMAS R. TROTTER LAWRENCE DELANEY JR. PRESIDENT/CEO (714) 734-5000 (602) 286-5500 ORTHOLOGIC REPORTS FIRST QUARTER 2003 RESULTS COMPANY ACHIEVES RECORD SALES OF BONE GROWTH STIMULATION PRODUCTS PATIENT ENROLLMENT PROCEEDING FOR HUMAN CLINICAL TRIALS OF CHRYSALIN FOR FRACTURE REPAIR AND SPINAL FUSION TEMPE, ARIZ., TUESDAY, APRIL 29, 2003--ORTHOLOGIC CORP. (NASDAQ: OLGC) today reported net income of $142,000, or $0.00 per diluted share, on revenues of $10.4 million for the first quarter ended March 31, 2003 compared with net income of $1.4 million, or $0.04 per diluted share, on revenues of $9.6 million for the first quarter of 2002. Revenues for the first quarter of 2003 were comprised entirely of sales of OrthoLogic's bone growth stimulation products. Revenues for the first quarter of 2002 were comprised of $8.7 million in bone growth stimulation product sales and $904,000 in Hyalgan royalties. Hyalgan-related royalties ended December 31, 2002. Net income for the first quarter of 2002 included an adjustment to the Continuous Passive Motion (CPM) divestiture and related charges of $600,000 related to higher than anticipated collection of CPM accounts receivables. "We are very pleased with our financial and operational performance for the first quarter of 2003," said Thomas R. Trotter, OrthoLogic's president and chief executive officer. "Our bone growth stimulation business continues to grow significantly faster than the market and is off to an excellent start this year. In addition, our Chrysalin orthobiologic program, which includes two ongoing human clinical trials, is progressing. FIRST QUARTER HIGHLIGHTS "For the first quarter of 2003, total bone growth stimulation revenues increased 19% over the first quarter of 2002," said Trotter. "We believe that this growth rate is higher than the overall market growth rate, indicating to us that we are continuing to gain market share. "Sales of the OL1000 were particularly strong during the first quarter of 2003, driven by record prescriptions and an exceptional performance by our direct sales force. As previously announced, we expanded our direct sales force at the 2 beginning of 2003, and we are already seeing a positive impact on our business as a result of this decision. In addition, prescriptions received for SpinaLogic showed double-digit growth compared to the first quarter of 2002. We expect to see continuing improvement in our bone growth stimulation sales over the balance of 2003." Trotter added, "We continue to progress with our Chrysalin orthobiologic program as well. In the Chrysalin Phase III human clinical trial for fracture repair, we have identified most of the 25-30 clinical sites that will participate in the study, and approximately one-third of them are already enrolling patients. We expect to have all clinical sites enrolling patients by the fall of this year. "In addition, we have identified approximately one-half of the sites that will participate in the Phase I/II spinal fusion human clinical trial, and several of them are already enrolling patients. During the quarter we expanded the criteria for our Phase I/II human clinical trial for spinal fusion to include two-level fusions. We expect this will have a positive effect on the rate of patient enrollment in that study. "We also continued to make progress this quarter on the pre-clinical Chrysalin program for cartilage defect repair. We remain hopeful regarding the initiation of a human clinical trial for that indication before the end of 2003," said Trotter. In early April, OrthoLogic settled a legal dispute with OrthoRehab Inc., the purchaser of the assets of the CPM business. Under the terms of the settlement agreement, OrthoRehab agreed to pay OrthoLogic $1.2 million to settle all outstanding claims, including the contingent payment due to OrthoLogic related to OrthoRehab's purchase of the assets of the CPM business. OrthoLogic has received an initial cash payment of $257,000. The balance of $1.2 million, or $943,000 plus interest, is scheduled to be paid to OrthoLogic over the next 36 months, beginning in May 2003. The initial cash payment, as well as all subsequent payments, will be included in the CPM divestiture and related charges line item in the Statement of Operations when received, beginning in the second quarter of 2003. OUTLOOK FOR 2003 Summarizing the outlook for OrthoLogic for the remainder of 2003, Trotter stated, "We are optimistic about achieving the ambitious goals we established for OrthoLogic this year, which will bring us closer to achieving our vision of becoming a worldwide leader in fracture repair, spinal fusion and orthopedic soft tissue repair. Based on the accomplishments for the first quarter of 2003, we believe we are off to a very good start." ABOUT ORTHOLOGIC CORP. OrthoLogic is a specialty orthopedic medical company poised to enter the orthobiologics market - one of the most promising areas in the biotech sector. The company's current products include the OL1000, approved by the FDA in 1994, which utilizes patented Combined Magnetic Field technology to deliver a highly specific, low-energy signal for the non-invasive treatment of an established nonunion acquired secondary to trauma, excluding vertebrae and all flat bones; and SpinaLogic(R), a state-of-the-art device used as an adjunct to primary lumbar spinal fusion surgery for one or two levels, approved by the FDA in late 1999. The company also manufactures and markets an external wrist fixation product, the OrthoFrame/Mayo Wrist Fixator, used in conjunction with certain surgical fracture repair procedures. 3 For more information, please visit the company's Web site: www.orthologic.com. CONFERENCE CALL INFORMATION A conference call to discuss first quarter results and provide financial guidance will take place today at 12 p.m. EDT (9 a.m. Arizona time and PDT). A live Webcast and Internet replay of the call will be provided, and can be accessed from the Investor Relations section of OrthoLogic's Web site at www.orthologic.com. Additionally, all StreetEvents subscribers can access the Webcast from www.streetevents.com. STATEMENTS IN THIS PRESS RELEASE OR OTHERWISE ATTRIBUTABLE TO ORTHOLOGIC REGARDING OUR BUSINESS THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING STATEMENTS MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. WORDS SUCH AS "CONTINUE," "OPTIMISTIC," "BELIEVE," "EXPECT," "REMAIN HOPEFUL," "POISED TO ENTER," AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY SUCH FORWARD-LOOKING STATEMENTS. SOME EXAMPLES OF FORWARD LOOKING STATEMENTS IN THIS PRESS RELEASE INCLUDE OUR ABILITY TO CONTINUE TO SIGNIFICANTLY INCREASE OUR SALES, PARTICULARLY TO NEW CUSTOMERS; OUR ABILITY TO ACCURATELY ESTIMATE THE SIZE AND GROWTH OF THE MARKETS WE COMPETE IN; THE EXPECTED SCHEDULE AND PROGRESS OF THE CHRYSALIN HUMAN CLINICAL TRIALS; OUR ABILITY TO OBTAIN THE NECESSARY REGULATORY APPROVAL FOR CHRYSALIN TRIALS AND USES; THE SPEED WITH WHICH WE CAN BRING CHRYSALIN TO THE MARKET; THE SIZE OF THE MARKET FOR CHRYSALIN; AND THE MARKET ACCEPTANCE OF CHRYSALIN-BASED PRODUCTS. THESE FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF PERFORMANCE AND ARE INHERENTLY SUBJECT TO RISKS AND UNCERTAINTIES, SOME OF WHICH CANNOT BE PREDICTED OR ANTICIPATED. MANY FACTORS COULD CAUSE ACTUAL RESULTS TO DIFFER FROM THOSE EXPRESSED IN THE FORWARD-LOOKING STATEMENTS, INCLUDING LOWER-THAN-EXPECTED ACCEPTANCE OF OUR PRODUCTS BY NEW PHYSICIANS AND NEW PATIENTS; OUR RELIANCE ON THE EFFICACY OF OUR OUTSIDE MARKETING AND DISTRIBUTION PARTNERS TO CONTINUE TO PROMOTE NEW SALES OF OUR PRODUCTS; DELAYS IN COMMENCING OR COMPLETING THE CLINICAL TRIALS DUE TO LACK OF AVAILABLE PATIENTS OR FUNDING; UNEXPECTED AND UNFAVORABLE RESULTS FROM THE CLINICAL TRIALS; INABILITY TO OBTAIN ULTIMATE APPROVAL FOR MARKETING OF CHRYSALIN REGARDLESS OF THE RESULTS OF THE CLINICAL TRIALS DUE TO CHANGES IN THE REGULATORY SCHEMES; AND ADVANCES IN OUR COMPETITORS' PRODUCTS. FOR ADDITIONAL RISKS ASSOCIATED WITH THE COMPANY, PLEASE SEE THE "RISK FACTORS" IN THE COMPANY'S ANNUAL REPORT ON FORM 10-K AND ITS REGULAR PERIODIC REPORTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. [FINANCIAL TABLES FOLLOW] 4 ORTHOLOGIC CORP. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA) Three months ended March 31, 2003 2002 -------- -------- (Unaudited) (Unaudited) Net revenues $ 10,372 $ 9,609 Cost of revenues 1,479 1,313 -------- -------- Gross Profit 8,893 8,296 Operating Expenses Selling, general and administrative 7,410 6,704 Research and development 1,460 920 Adjustment to CPM Divestiture and related charges -- (600) -------- -------- Total operating expenses 8,870 7,024 -------- -------- Operating income 23 1,272 Total other income 132 187 -------- -------- Income before income taxes 155 1,459 Provision for income taxes 13 13 Net income $ 142 $ 1,446 ======== ======== BASIC EARNINGS PER SHARE Net income per common share $ 0.00 $ 0.04 ======== ======== Weighted average number of common shares outstanding 32,809 32,515 ======== ======== DILUTED EARNINGS PER SHARE Net income per common and equivalent shares $ 0.00 $ 0.04 ======== ======== Weighted average number of diluted shares outstanding 33,028 33,300 ======== ======== 5 ORTHOLOGIC CORP CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) March 31 December 31, 2003 2002 --------- --------- ASSETS (Unaudited) Cash and cash equivalents $ 10,706 $ 11,286 Short-term investments 17,412 18,660 Accounts receivable 9,223 9,641 Inventory 2,716 2,568 Prepaids and other current assets 677 598 Deferred income tax 1,667 1,667 --------- --------- Total current assets 42,401 44,420 Furniture and equipment 8,219 8,572 Accumulated depreciation (6,793) (7,074) --------- --------- Furniture and equipment, net 1,426 1,498 Long-term investments 8,239 5,659 Deferred income taxes - non-current 964 964 Chrysalin investment 750 750 Deposits and other assets 115 129 --------- --------- Total assets $ 53,895 $ 53,420 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Accounts payable $ 692 $ 477 Accrued liabilities 4,150 4,148 Accrued liabilities on CPM divestiture and related charges 87 210 --------- --------- Total current liabilities 4,929 4,835 Deferred rent 334 352 --------- --------- Total liabilities 5,263 5,187 --------- --------- STOCKHOLDERS' EQUITY Common stock 16 16 Additional paid-in capital 139,280 136,945 Common stock to be used for legal settlement -- 2,078 Accumulated deficit (90,527) (90,669) Treasury Stock (137) (137) --------- --------- Total stockholders' equity 48,632 48,233 --------- --------- Total Liabilities and Stockholders' Equity $ 53,895 $ 53,420 ========= ========= # # # -----END PRIVACY-ENHANCED MESSAGE-----