-----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, OoRSYl4ULUhydbCaZMd7bIF6QmPQhY/9hCmWJN8ueRnyEXHyNzbVIlllvQUb5eyw taecQyshwZy67IJdR+f1Ng== 0000950109-95-001830.txt : 19950517 0000950109-95-001830.hdr.sgml : 19950516 ACCESSION NUMBER: 0000950109-95-001830 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950512 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SHARED MEDICAL SYSTEMS CORP CENTRAL INDEX KEY: 0000089415 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [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: 95537638 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 FORM 10-Q 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, 1995 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 offices) (Zip Code) (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, 1995, there were 23,091,674 shares of Common Stock outstanding. PART I - FINANCIAL INFORMATION Item 1. Financial Statements. SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED BALANCE SHEET ----------------------------------
March 31 December 31 1995 1994 ------------- ------------ (unaudited) ASSETS Current Assets: Cash and short-term investments................. $ 14,978,000 $ 21,249,000 Accounts receivable, net of reserve of $5,606,000 in 1995 and $5,317,000 in 1994..... 140,620,000 138,554,000 Prepaid expenses and other current assets....... 20,146,000 17,675,000 ------------ ------------ Total Current Assets.......................... 175,744,000 177,478,000 ------------ ------------ Property and Equipment, at cost: Land and land improvements...................... 10,712,000 10,711,000 Buildings....................................... 59,499,000 59,402,000 Equipment....................................... 172,854,000 169,487,000 ------------ ------------ 243,065,000 239,600,000 Less: Accumulated depreciation and amortization........................... 140,183,000 134,513,000 ------------ ------------ 102,882,000 105,087,000 ------------ ------------ Computer Software, net of accumulated amortization of $38,234,000 in 1995 and $36,158,000 in 1994............................. 39,595,000 38,801,000 ------------ ------------ Other Assets...................................... 57,721,000 58,699,000 ------------ ------------ $375,942,000 $380,065,000 ============ ============
The accompanying note is an integral part of this statement. 2 SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED BALANCE SHEET (Continued) --------------------------------------
March 31 December 31 1995 1994 ------------ ------------ (unaudited) LIABILITIES AND STOCKHOLDERS' INVESTMENT Current Liabilities: Notes payable................................................................... $ 18,552,000 $ 12,383,000 Current portion of long-term obligations under capital leases................... 3,120,000 3,100,000 Dividends payable............................................................... 4,847,000 4,818,000 Accounts payable................................................................ 22,731,000 23,633,000 Accrued expenses................................................................ 20,953,000 38,189,000 Current deferred revenues....................................................... 27,091,000 28,133,000 Accrued and current deferred income taxes....................................... 9,927,000 6,591,000 ------------ ------------ Total Current Liabilities..................................................... 107,221,000 116,847,000 ------------ ------------ Deferred Revenues................................................................. 15,916,000 17,352,000 ------------ ------------ Long-Term Obligations Under Capital Leases........................................ 4,164,000 4,974,000 ------------ ------------ Deferred Income Taxes............................................................. 21,948,000 21,696,000 ------------ ------------ Stockholders' Investment: Preferred stock, par value $.10; authorized 1,000,000 shares; none issued....... - - Common stock, par value $.01; authorized 60,000,000 shares;..................... 1995 1994 ---------- ---------- Shares issued..................................... 27,103,165 26,964,821 Less- Treasury shares: Donated....................................... 1,114,400 1,114,400 Purchased..................................... 2,907,022 2,907,875 Shares outstanding................................ 23,081,743 22,942,546 271,000 270,000 Paid-in capital................................................................. 34,249,000 32,365,000 Retained earnings............................................................... 249,442,000 244,698,000 Purchased common stock in treasury, at cost..................................... (55,097,000) (55,116,000) Cumulative translation adjustment............................................... (2,172,000) (3,021,000) ------------ ------------ Total Stockholders' Investment................................................ 226,693,000 219,196,000 ------------ ------------ $375,942,000 $380,065,000 ============ ============
3 SHARED MEDICAL SYSTEMS CORPORATION CONSOLIDATED STATEMENT OF INCOME ----------------------------------
Three Months Ended March 31 ------------------------------ 1995 1994 ------------ ------------ (unaudited) Revenues: Service and system fees............................ $134,138,000 $115,414,000 Hardware sales..................................... 11,201,000 9,756,000 ------------ ------------ 145,339,000 125,170,000 ------------ ------------ Cost and Expenses: Operating and development.......................... 63,291,000 53,164,000 Marketing and installation......................... 44,050,000 38,287,000 General and administrative......................... 12,586,000 11,177,000 Cost of hardware sales............................. 9,240,000 8,249,000 Interest........................................... 450,000 286,000 ------------ ------------ 129,617,000 111,163,000 ------------ ------------ Income Before Income Taxes........................... 15,722,000 14,007,000 Provision for Income Taxes........................... 6,131,000 5,463,000 ------------ ------------ Net Income........................................... $ 9,591,000 $ 8,544,000 ============ ============ Net Income Per Common Share.......................... $.41 $.37 ============ ============ Number of shares used to compute per share amounts............................................ 23,565,000 23,225,000 ============ ============ 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 ------------------------------ 1995 1994 ------------ ------------ (unaudited) Cash Flows from Operating Activities: Net Income...................................... $ 9,591,000 $ 8,544,000 Adjustments to reconcile net income to net cash used for operating activities - Depreciation and amortization............... 8,632,000 7,458,000 Asset (increase) decrease - Accounts receivable....................... (2,066,000) (1,846,000) Prepaid expenses and other current assets.................................. (2,471,000) 2,761,000 Other assets.............................. 650,000 (1,413,000) Liability increase (decrease) - Accounts payable and accrued expenses..... (18,138,000) (13,427,000) Accrued and current deferred income taxes................................... 3,336,000 (1,008,000) Deferred revenues......................... (2,478,000) (2,165,000) Deferred income taxes..................... 252,000 (57,000) Other....................................... 928,000 (323,000) ------------ ------------ Net cash used for operating activities......... (1,764,000) (1,476,000) ------------ ------------ Cash Flows from Investing Activities: Property and equipment additions................ (4,075,000) (2,747,000) Investment in computer software................. (2,917,000) (3,137,000) Dispositions of equipment....................... 20,000 214,000 ------------ ------------ Net cash used for investing activities......... (6,972,000) (5,670,000) ------------ ------------ Cash Flows from Financing Activities: Dividends paid.................................. (4,818,000) (4,778,000) Change in treasury stock........................ 19,000 41,000 Payments on long-term obligations............... (790,000) (653,000) Increase in notes payable....................... 6,169,000 1,262,000 Exercise of stock options....................... 1,885,000 1,167,000 ------------ ------------ Net cash provided by (used for) financing activities................................... 2,465,000 (2,961,000) ------------ ------------ Net Decrease in Cash and Short-Term Investments...................................... (6,271,000) (10,107,000) Cash and Short-Term Investments, Beginning of Period........................................ 21,249,000 35,826,000 ------------ ------------ Cash and Short-Term Investments, End of Period........................................ $ 14,978,000 $ 25,719,000 ============ ============
The accompanying note is an integral part of this statement. 5 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- Note to Consolidated Financial Statements March 31, 1995 (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, 1995. 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, 1995. 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 any anticipated expenditures primarily through internally generated funds supplemented by bank borrowings as necessary. At March 31, 1995, the Company had lines of credit with banks totaling $52,242,000, primarily at their prime interest rates. At March 31, 1995, $33,690,000 of these lines of credit remained unused. Material Changes in Results of Operations - ----------------------------------------- Three Months Ended March 31, 1995 Compared to the Three Months Ended March 31, 1994. Revenues -------- Service and system fees revenues increased by $18,724,000 (16.2%) in the first quarter of 1995 compared to the first quarter of 1994. Contributing to this increase were higher levels of professional services, system processing fees, and revenues associated with the Company's MedSeries4 division which was acquired from a subsidiary of GTE Corporation on September 30, 1994. No revenues for the MedSeries4 division are included in the Company's results from operations for the first quarter of 1994. The higher level of professional services was generally attributable to systems installation and support. The increase in system processing fees was primarily due to the higher level of customer applications processed at the Company's Information Services Center. 6 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- Hardware sales revenues increased to $11,201,000 for the first quarter of 1995 from $9,756,000 in the first quarter of 1994 primarily due to differences in the timing and product mix of systems installed. Cost and Expenses ----------------- Operating and development expenses increased to 47.2% of service and system fees revenues in the first quarter of 1995 from 46.1% in the first quarter of 1994. This change was primarily due to increased computer hardware and associated costs related to higher levels of system processing services provided to the Company's customers. Marketing and installation expenses decreased to 32.8% of service and system fees revenues in the first quarter of 1995 from 33.2% in the first quarter of 1994. This decrease was primarily due to improved efficiency in providing installations and support services to the Company's customers. General and administrative expenses, as a percentage of service and systems fees revenues, decreased to 9.4% in the first quarter of 1995 from 9.7% in the first quarter of 1994, primarily due to the Company's ongoing efforts to control administrative costs. Cost of hardware sales decreased to 82.5% of hardware sales revenues in the first quarter of 1995 from 84.6% in the first quarter of 1994. This change was primarily due to the different product mixes of systems installed in each quarter. Interest expense was $450,000 in the quarter ended March 31, 1995 compared to $286,000 in the same period in 1994. This change was primarily due to a higher level of outstanding borrowings associated with the Company's short- term loan obligations. Provision for Income Taxes -------------------------- The provision for income taxes increased in the quarter ended March 31, 1995, by $668,000 (12.2%) when compared to the same period in 1994. This change was due to an increase of $1,715,000 (12.2%) in income before income taxes. The Company's effective tax rate was 39.0% in the first quarter of 1995 and 1994. Net Income ---------- Net income was $9,591,000 in the quarter ended March 31, 1995 compared to $8,544,000 in the quarter ended March 31, 1994 for the reasons discussed above. 7 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K. (a) The following exhibit is included in this report: No. Description --- -------------------------------------------- (27) Financial Data Schedule (b) No reports on Form 8-K were filed during the three-month period ended March 31, 1995. 8 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 12, 1995 /S/ Terrence W. Kyle - ------------ ---------------------------------- Date Terrence W. Kyle Vice President of Finance Principal Financial Officer and Duly Authorized Officer 9 SHARED MEDICAL SYSTEMS CORPORATION ---------------------------------- Exhibit Index No. Description - --- ----------------------------------------------------------------------- (27) Financial Data schedule 10 EX-27 2 FINANCIAL DATA SCHEDULE
5 1,000 3-MOS DEC-31-1995 JAN-01-1995 MAR-31-1995 14,978 0 146,226 5,606 0 175,744 243,065 140,183 375,942 107,221 4,164 271 0 0 226,422 375,942 11,201 145,339 9,240 116,581 12,586 0 450 15,722 6,131 9,591 0 0 0 9,591 .41 .41
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