-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, OXrT269XF7dxwMM6PBbbJ729X22AaDaHSv4WfW+OPVJ0wq6NN6ZyM1IRBGi5HDtN sWPOH5unGDcASZfzLAuu5g== 0000950109-94-000837.txt : 19940516 0000950109-94-000837.hdr.sgml : 19940516 ACCESSION NUMBER: 0000950109-94-000837 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SHARED MEDICAL SYSTEMS CORP CENTRAL INDEX KEY: 0000089415 STANDARD INDUSTRIAL CLASSIFICATION: 7374 IRS NUMBER: 231704148 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-07416 FILM NUMBER: 94528129 BUSINESS ADDRESS: STREET 1: 51 VALLEY STREAM PKWY CITY: MALVERN STATE: PA ZIP: 19355 BUSINESS PHONE: 2152196300 MAIL ADDRESS: STREET 1: 51 VALLEY STREAM PKWY CITY: MALVERN STATE: PA ZIP: 19355 10-Q 1 SMS FORM 10-Q DATED 3/31/94 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 March 31, 1994 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to___________ Commission file number 0-7416 SHARED MEDICAL SYSTEMS CORPORATION (Exact name of registrant as specified in its charter) Delaware 23-1704148 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 51 Valley Stream Parkway Malvern, Pennsylvania 19355 (Address of principal executive (Zip Code) offices) (610) 219-6300 (Registrant's telephone number, including area code) Not Applicable (Former name, former address, and former fiscal year, if changed since last report) 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 ------- ------- On April 30, 1994, there were 22,856,113 shares of Common Stock outstanding. PART I - FINANCIAL INFORMATION Item 1. Financial Statements. SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED BALANCE SHEET ----------------------------------
March 31 December 31 1994 1993 ------------- ------------ (unaudited) ASSETS Current Assets: Cash and short-term investments........... $ 25,719,000 $ 35,826,000 Accounts receivable, net of reserve of $4,376,000 in 1994 and $4,279,000 in 1993...................................... 114,984,000 113,138,000 Prepaid expenses, inventories, etc........ 13,811,000 16,572,000 ------------ ------------ Total Current Assets.................... 154,514,000 165,536,000 ------------ ------------ Property and Equipment, at cost: Land and land improvements................ 10,703,000 10,703,000 Buildings................................. 57,534,000 57,368,000 Equipment................................. 180,465,000 183,257,000 ------------ ------------ 248,702,000 251,328,000 Less: Accumulated depreciation and amortization..................... 146,917,000 146,463,000 ------------ ------------ 101,785,000 104,865,000 ------------ ------------ Computer Software, net of accumulated amortization of $30,225,000 in 1994 and $28,552,000 in 1993....................... 34,957,000 33,547,000 ------------ ------------ Other Assets................................ 38,788,000 37,494,000 ------------ ------------ $330,044,000 $341,442,000 ============ ============
The accompanying note is an integral part of this statement. 2 SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED BALANCE SHEET (Continued) --------------------------------------
March 31 December 31 1994 1993 ------------- ------------- (unaudited) LIABILITIES AND STOCKHOLDERS' INVESTMENT Current Liabilities: Notes payable........................................................................ $ 7,092,000 $ 5,830,000 Current portion of long-term obligations under capital leases............................................................... 2,404,000 2,433,000 Dividends payable.................................................................... 4,796,000 4,778,000 Accounts payable..................................................................... 14,668,000 16,509,000 Accrued expenses..................................................................... 20,848,000 32,434,000 Current deferred revenues............................................................ 22,627,000 23,477,000 Accrued and current deferred income taxes............................................ 6,371,000 7,379,000 ------------ ------------ Total Current Liabilities.......................................................... 78,806,000 92,840,000 ------------ ------------ Deferred Revenues...................................................................... 20,304,000 21,619,000 ------------ ------------ Long-Term Obligations Under Capital Leases............................................. 5,771,000 6,395,000 ------------ ------------ Deferred Income Taxes.................................................................. 22,325,000 22,382,000 ------------ ------------ Stockholders' Investment: Preferred stock, par value $.10; authorized 1,000,000 shares; none issued............................................................................. -- -- Common stock, par value $.01; authorized 60,000,000 shares; 1994 1993 ---------- ---------- Shares issued............................................ 26,855,050 26,770,731 Less- Treasury shares: Donated.............................................. 1,114,400 1,114,400 Purchased............................................ 2,901,020 2,903,523 Shares outstanding............................................. 22,839,630 22,752,808 269,000 268,000 Paid-in capital...................................................................... 29,995,000 28,829,000 Retained earnings.................................................................... 232,577,000 228,831,000 Purchased common stock in treasury, at cost............................................................................ (54,907,000) (54,948,000) Cumulative translation adjustment.................................................... (5,096,000) (4,774,000) ------------ ------------ Total Stockholders' Investment..................................................... 202,838,000 198,206,000 ------------ ------------ $330,044,000 $341,442,000 ============ ============
3 SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED STATEMENT OF INCOME ----------------------------------
Three Months Ended March 31 --------------------------- 1994 1993 ------------ ------------ (unaudited) Revenues: Service and system fees......................... $115,414,000 $108,114,000 Hardware sales.................................. 9,756,000 9,106,000 ------------ ------------ 125,170,000 117,220,000 Cost of Hardware Sales............................ 8,249,000 7,333,000 ------------ ------------ Revenues Less Cost of Hardware Sales.............. 116,921,000 109,887,000 ------------ ------------ Expenses: Operating and development....................... 53,164,000 51,006,000 Marketing and installation...................... 38,287,000 35,791,000 General and administrative...................... 11,177,000 10,667,000 Interest........................................ 286,000 264,000 ------------ ------------ 102,914,000 97,728,000 ------------ ------------ Income Before Income Taxes........................ 14,007,000 12,159,000 Provision for Income Taxes........................ 5,463,000 4,620,000 ------------ ------------ Net Income........................................ $ 8,544,000 $ 7,539,000 ============ ============ Net Income Per Common Share....................... $.37 $.33 ============ ============ Number of shares used to compute per share amounts......................................... 23,225,000 23,031,000 ============ ============ Dividends Declared Per Common Share............... $.21 $.21 ============ ============
The accompanying note is an integral part of this statement. 4 SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED STATEMENT OF CASH FLOWS ------------------------------------
Three Months Ended March 31 ---------------------------- 1994 1993 ------------- ------------- (unaudited) Cash Flows from Operating Activities: Net Income.................................. $ 8,544,000 $ 7,539,000 Adjustments to reconcile net income to net cash provided by operating activities - Depreciation and amortization............... 7,458,000 7,335,000 Asset (increase) decrease - Accounts receivable........................ (1,846,000) (566,000) Prepaid expenses, inventories, etc......... 2,761,000 (3,628,000) Other assets............................... (1,413,000) (1,537,000) Liability increase (decrease) - Accounts payable and accrued expenses...... (13,427,000) (3,053,000) Deferred revenues.......................... (2,165,000) 1,080,000 Accrued and deferred income taxes.......... (1,065,000) 2,544,000 Other....................................... (323,000) (651,000) ------------ ------------ Net cash (used) provided by operating activities............................... (1,476,000) 9,063,000 ------------ ------------ Cash Flows from Investing Activities: Property and equipment additions............ (2,747,000) (9,482,000) Investment in computer software............. (3,137,000) (2,873,000) Dispositions of equipment................... 214,000 139,000 Partnership investment and related loan..... - (8,200,000) ------------ ------------ Net cash used for investing activities..... (5,670,000) (20,416,000) ------------ ------------ Cash Flows from Financing Activities: Dividends paid.............................. (4,778,000) (4,739,000) Change in treasury stock.................... 41,000 58,000 Payments on long-term obligations under capital leases............................. (653,000) (412,000) Increase (decrease) in notes payable........ 1,262,000 (6,000) Exercise of stock options................... 1,167,000 243,000 ------------ ------------ Net cash used for financing activities..... (2,961,000) (4,856,000) ------------ ------------ Net Decrease in Cash and Short-Term Investments.................................. (10,107,000) (16,209,000) Cash and Short Term Investments, Beginning of Period.................................... 35,826,000 30,854,000 ------------ ------------ Cash and Short-Term Investments, End of Period.................................... $ 25,719,000 $ 14,645,000 ============ ============
The accompanying note is an integral part of this statement. 5 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- Note to Consolidated Financial Statements March 31, 1994 (unaudited) - Note 1 - The information furnished in this Form 10-Q reflects all normal and ------ recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the financial statements as of March 31, 1994. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Material Changes in Financial Condition - --------------------------------------- The Company's financial condition has remained strong throughout the three months ended March 31, 1994. Management is not aware of any potential material impairments to the Company's current financial position nor is it aware of any material changes. The most significant requirements for funds now anticipated are for purchases of equipment and payment of cash dividends. The Company plans to fund these expenditures primarily through internally generated funds. At March 31, 1994, the Company had lines of credit with banks totaling $50,684,000, primarily at their prime interest rates. At March 31, 1994, $43,592,000 of these lines of credit remained unused. Material Changes in Results of Operations - ----------------------------------------- Three Months Ended March 31, 1994 Compared to the Three Months Ended March 31, 1993. Revenues -------- Service and system fees revenues increased by $7,300,000 (6.8%) in the first quarter of 1994 compared to the first quarter of 1993. Contributing to this increase were higher levels of system processing fees and professional services support fees. Hardware sales revenues increased to $9,756,000 for the first quarter of 1994 from $9,106,000 in the first quarter of 1993 due primarily to changes in the timing and product mix of systems installed. Cost of Hardware Sales ---------------------- Cost of hardware sales increased by $916,000 in the quarter ended March 31, 1994 compared to the same period in 1993. This increase was primarily due to the increase in hardware sales revenues. Additionally, cost of hardware sales fluctuated due to changes in the timing and product mix of systems installed. 6 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- Expenses -------- Operating and development expenses increased by $2,158,000 (4.2%) in the quarter ended March 31, 1994 compared to the same period in 1993. This increase was primarily due to increased personnel and related costs to support the higher levels of professional services provided by the Company. These increases were partially offset by efficiencies gained through decreased costs for computer hardware at the Company's Information Systems Center. Marketing and installation expenses increased by $2,496,000 (7.0%) in the quarter ended March 31, 1994 compared to the same period in 1993 primarily due to increased costs for personnel and outside consulting fees related to the higher levels of professional services provided by the Company. General and administrative expenses increased by $510,000 (4.8%) in the quarter ended March 31, 1994 compared to the same period in 1993 primarily due to increased personnel and related costs to support the business. Provision for Income Taxes -------------------------- The provision for income taxes increased in the quarter ended March 31, 1994, by $843,000 (18.2%) when compared to the same period in 1993. This increase was primarily due to an increase of $1,848,000 (15.2%) in income before income taxes. Additionally, the Company's effective tax rate was 39% in the first quarter of 1994 compared to 38% in the first quarter of 1993. The change in the effective tax rate was primarily due to an increase in the statutory corporate income tax rate for federal income taxes enacted in the third quarter of 1993. Net Income ---------- Net income was $8,544,000 in the quarter ended March 31, 1994 compared to $7,539,000 in the quarter ended March 31, 1993 for the reasons discussed above. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K. (a) None (b) No reports on Form 8-K were filed during the three-month period ended March 31, 1994. 7 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- 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. SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- Registrant May 13, 1994 /s/ Terrence W. Kyle - ------------ ---------------------------------- Date Terrence W. Kyle Vice President of Finance Principal Financial Officer and Duly Authorized Officer 8 -----END PRIVACY-ENHANCED MESSAGE-----