SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________________________________
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the
Securities Act of 1934
FOR QUARTER ENDED SEPTEMBER 30, 1995
Commission File Number 0-12248
DAXOR CORPORATION
(Exact Name as Specified in its Charter)
New York 13-2682108
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
350 Fifth Ave
Suite 7120
New York, New York 10118
(Address of Principal Executive Offices & Zip Code)
Registrant's Telephone Number: (212) 244-0555
(Including Area Code)
Indicate by check mark whether the registrant (1) has filed all reports required
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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
CLASS OUTSTANDING AT SEPTEMBER 30, 1995
COMMON STOCK 4,770,909
PAR VALUE: $.O1 per share
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS PAGE
Consolidated Balance Sheets as at
September 30, 1995 and December 31,1994 2
Consolidated Statements of Operations for the
Three and Nine Months ended September 30, 1995
and 1994 3
Consolidated Statements of Cash Flows for the
Nine Months ended September 30, 1995 and 1994 4
Notes to Financial Statements 5
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<HEADER>
DAXOR CORPORATION
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
<S> <C> <C>
September 30, December 31,
1995 1994
ASSETS
___________________________________________________________________________
Current Assets:
Cash $ 69,692 $ 59,962
Marketable Securities at Fair Value
June 30,1995 and December 31,
1994.(Notes 1 and 2) 37,167,278 33,598,931
Accounts Receivable 121,694 215,831
Other Current Assets 237,238 472,307
Tax Refunds Receivable 206,233 206,233
---------- ----------
TOTAL CURRENT ASSETS: 37,802,135 34,553,264
========== ==========
___________________________________________________________________________
Equipment and Improvements
Storage Tanks 125,815 125,815
Leasehold Improvements, Furniture
and Equipment 613,244 592,240
Laboratory Equipment 281,418 279,964
--------- -------
1,020,477 998,019
Less Accumulated Depreciation and
Amortization (610,180) (579,805)
--------- -------
Net Equipment and Improvements 410,297 418,214
Other Assets 38,356 41,160
TOTAL ASSETS: $38,250,788 $ 35,012,638
=========== ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable and Accrued Liabilities $ 26,727 $ 15,682
Loans Payable (Notes 1 and 2) 2,950,759 3,864,605
Other Liabilities (Note 1) 97,052 110,406
Deffered Taxes (Note 3) 3,534,357 1,822,765
--------- ---------
TOTAL LIABILITIES: 6,608,895 5,813,458
Shareholders' Equity:
Common Stock, par value $.01 per Share:
Authorized 10,000,000 Shares: Issued and
Outstanding 4,770,909 shares September 30,
1995 and 5,067,630 at December 31, 1994 53,097 53,097
Additional Paid in Capital 8,579,803 8,579,803
Net Unrealized Holding gains on available-
for-sale securities(Note 1) 6,730,985 3,470,428
Retained Earnings 19,141,552 18,051,094
Treasury Stock (2,863,544) (955,242)
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 31,641,893 29,199,180
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 38,250,788 $ 35,012,638
============ ============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
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<TABLE>
DAXOR CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<HEADER>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPT 30 SEPT 30
<S> <C> <C> <C> <C>
1995 1994 1995 1994
REVENUES
Operating Revenues $ 254,928 $ 452,771 $1,188,521 $1,406,679
Dividend Income 528,262 530,493 1,663,637 1,593,952
Gains (Losses) on Sale
of Securities 195,311 51,303 483,083 180,862
Gains (Losses) On Sale of
Options and Commodities 12,783 1,150 19,873 199,097
------- --------- --------- ---------
TOTAL REVENUES 991,284 1,035,717 3,325,114 3,380,590
------- --------- --------- ---------
COSTS AND EXPENSES
Operations of Laboratories 217,345 281,522 775,876 848,387
Selling, General, and
Administrative 583,780 309,670 1,413,776 955,746
Interest Expense, Net of
Interest Income (61,742) (45,214) (62,619) (57,154)
------- -------- ---------- ----------
TOTAL COSTS AND EXPENSES 739,383 545,978 2,127,033 1,746,979
------- -------- ---------- ----------
Net Income (Loss) Before
Income Taxes 251,901 489,739 1,198,081 1,633,611
Provision for Income Taxes 29,549 52,267 107,624 137,201
------- ------- --------- ---------
NET INCOME (LOSS) $ 222,352 $ 437,472 $1,090,457 $ 1,496,410
======= ======= ========= =========
Weighted Average Number
of Shares Outstanding 4,782,142 5,123,863 4,913,716 5,139,730
========= ========= ========= =========
Net Income (Loss) Per Common
Equivalent Share $0.05 $0.08 $0.22 $0.29
===== ===== ===== =====
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SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
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<TABLE>
<HEADER>
DAXOR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED
<S> <C> <C>
SEPT 30, SEPT 30,
1995 1994
___________________________________________
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income or (Loss)........................... $1,090,457 $ 1,496,410
---------- ----------
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation equipment and improvements........ 30,375 38,795
Amortization - goodwill........................ 2,804 4,206
(Gain) Loss on sale of investments............. (502,956) (52,453)
Change in assets and liabilities:
(increase) decrease in accounts receivable... 94,137 (40,645)
(increase) decrease in other current assets.. 235,069 4,568
(increase) decrease in tax refunds receivable -0- 25,000
(increase) decrease in other assets.......... -0- (5,152)
increase (decrease) in accounts payable,
accrued and other liabilities net of "short
sales"....................................... 11,645 (100,855)
--------- ---------
Total adjustments............................ (128,926) (126,536)
--------- ---------
Net cash provided by or (used in) operating
activities................................... 961,531 1,369,874
-------- ---------
___________________________________________
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for purchase of equipment and
improvements................................. (22,458) 24,045
Net cash provided or (used) in purchase and
sale of investments.......................... 1,806,503 305,395
Net proceeds (repayments) of loans from brokers
used to purchase investments................. 586,154 1,068,095
Proceeds from "short sales" not closed......... 86,302 144,143
--------- ---------
Net cash provided by or (used in) investing
activities................................... 2,456,501 (594,512)
--------- ----------
___________________________________________
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of Bank Loan....................... (1,500,000) (700,000)
Payment for purchase of treasury stock....... (1,908,302) (234,935)
----------- ---------
Net cash provided by or (used in) financing
activities............................... (3,408,302) (934,935)
----------- ---------
Net increase (decrease) in cash and cash
equivalents.................................. 9,730 (159,573)
Cash and cash equivalents at beginning of year 59,962 262,299
----------- ---------
Cash and cash equivalents at end of period... $ 69,692 $ 102,726
============ ==========
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SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
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<HEADER>
DAXOR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
SIX MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
In the opinion of the Company, the accompanying unaudited consolidated financial
statements contain all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position as of September 30,
1995 and December 31, 1994, the results of operations for the three and nine
months ended September 30, 1995 and 1994 and cash flows for the nine months
ended September 30, 1995 and 1994. The consolidated financial statements
include the accounts of the Company and its subsidary. All significant
intercompany transactions and balances have been eliminated in consolidation.
1. MARKETABLE SECURITIES
Upon adoption of FASB No. 115, management has determined that the company's
portfolio is best characterized as "Available-For-Sale". This has resulted in
the balance sheet carrying value of the company's marketable securities
investments, as of September 30,1995, and December 31, 1994, being increased
approximately 38.15% and 18.70% respectively over its historical cost. A
corresponding increase in shareholders' equity has been effectuated. In
accordance with the provisions of FASB No.115, the adjustment in shareholders'
equity to reflect the company's unrealized gains has been made net of the tax
effect had these gains been realized. The prior period has not been restated.
The following table summarizes the company's investments as of September 30,
1995.
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<S> <C> <C> <C> <C>
TYPE OF COST FAIR VALUE UNREALIZED UNREALIZED
SECURITY HOLDING GAINS HOLDING LOSSES
Equity $25,151,920 $35,473,632 $12,164,988 $1,843,276
Debt 1,750,016 1,693,646 36,229 92,599
----------- ----------- ----------- ----------
Total $26,901,936 $37,167,278 $12,201,217 $1,935,875
=========== =========== =========== ==========
December 31, 1994
TYPE OF COST FAIR VALUE UNREALIZED UNREALIZED
SECURITY HOLDING GAINS HOLDING LOSSES
Equity $26,555,721 $31,892,894 $7,991,063 $2,653,890
Debt 1,750,016 1,706,037 22,544 66,523
----------- ----------- ---------- ----------
Total $28,305,737 $33,598,931 $8,013,607 $2,720,413
=========== =========== ========== ==========
</TABLE>
At September 30, 1995, the securities held by the Company had a market value of
$37,167,278 and a cost basis of $26,901,936 resulting in a net unrealized gain
of $10,265,342 or 38.15% of cost.
At December 31, 1994, the securities held by the Company had a market value of
$33,598,931 and a cost basis of $28,305,737 resulting in a net unrealized gain
of $5,293,194 or 18.70% of cost. At September 30, 1995 and December 31, 1994,
marketable securities, primarily consisting of preferred and common stocks of
utility companies, are valued at fair value.
2. LOANS PAYABLE
As at September 30, 1995 and December 31, 1994, the Company had loans
outstanding aggregating $1,100,000 and $2,600,000 respectively, borrowed on a
short-term basis from a bank, which are secured by certain marketable securities
owned by the Company. These loans bear interest at approximately 8.5%.
Short term margin debt due to brokers, secured by the Company's marketable
securities, totalled $ 1,850,759 at September 30, 1995 and $ 1,264,605 at
December 31, 1994.
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<PAGE>
PART II. OTHER INFORMATION
ITEM 2 Legal Proceedings
As previously reported, Daxor Corporation, (through its separately licensed
divisions), has been involved in several proceedings with the New York State
Department of Health relating to its licenses to operate clinical laboratories,
its blood bank and semen bank. The following is a summary of recent activity in
in these matters:
Daxor has instituted several actions against the New York State Department of
Health challenging the determination of the Health Department to revoke licenses
issued to Daxor and to deny license applications for Daxor's New York health
care facilities. Daxor has also challenged the constitutionality of the
Department's semen bank regulations. Currently Daxor's challenges have been
denied and Daxor's licenses have been denied. However, an expedited appeal with
the New York Appellate Division was filed by Daxor on November 6, 1995.
In an administrative hearing instituted by the New York Department of Health
Daxor's provisional license for semen banking was revoked without imposition of
fines on August 21, 1995. Daxor is in the process of filing an appeal.
As a result of the denial of its licenses and numerous publications concerning
the Company, Daxor instituted several actions which include an anti-trust action
under the Racketeering Influenced Corrupt Organization Act (RICO) against the
New York Blood Center and various employees of the New York State Department of
Health seeking $ 100,000,000 in damages. Daxor also filed a defamation suit
(alleging false claims that Daxor did not test its semen donors) against Amy
Clyde and K-III Corp., publisher of New York Magazine seeking $25,000,000 in
damages from each defendent, as well as a defamation suit in the New York
Court of Claims against the State of New York for dissemination of false
information to the media by employees of the State Health Department.
Lastly a class action has been instituted by Daxor's sperm and blood bank
depositors against the New York Department of Health to enjoin the Department
from removing or destroying the depositor's sperm and blood specimens.
Item 6(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K during the quarter ended
September 30,
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<PAGE>
ITEM 2.
Management's discussion and analysis of financial conditions and results of
operations.
RESULTS OF OPERATIONS
Nine months ended Sept. 30, 1995 as compared with nine months ended Sept 30,
1994.
For the nine months ended September 30, 1994, total revenues were $3,325,114
down slightly from $3,380,590, in 1994. Operating revenues were $1,188,521
in 1995, down from $1,593,952 in 1994. Dividend income was $1,663,637 with an
interest expense of ($62,618) as compared to dividend income of $1,593,952 with
an interest expense of ($57,154) in 1994. In 1995, the Company had a net
income of $1,090,457 before income taxes versus a net income of $1,496,410
before taxes in 1994.
Three months ended September 30, 1995 as compared with three months ended
September 30, 1994.
For the three months ended September 30, 1995 total revenues declined to
$991,284 from $1,035,717 in the 1994 quarter. In 1995, dividend income was
$528,262 with an interest expense of ($61,742) compared to dividend income of
$530,493 with an interest expense of ($45,214) in 1994. The Company had a net
income of $251,901 before income taxes in 1995 versus a net income of $489,739
before taxes in the 1994 quarter. Operations were negatively impacted by the
partial closure of the Company's New York State
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1995 the Company had total assets of $38,250,788 and total
liabilities of $6,608,895 with shareholders' equity of $31,641,893. The Company
has $ 6,730,985 of net after tax unrealized capital gains on available-for-sale
securities in its portfolio. This amount is included in the calculation of Total
Shareholders' Equity.
The Company has adequate resources for the initial development and marketing
of its instrument (the Blood Volume Analyzer BVA-100). The Company plans to
market its BVA-100 on a loaner basis to hospitals with a guaranteed number of
kit purchases. The Company would require additional capital to sustain this
marketing plan to all potential hospital users. If the Company were to expand
its blood banking operation on a full scale, nation-wide basis, it would require
additional capital. The Company has adequate capital to sustain its New York
State blood banking facility.
The Company is currently evaluating a preliminary proposal to purchase another
private blood banking corporation The Company is also considering expanding its
ownership stake in US Cryobanks of Florida. Daxor Corporation provided its
technology and methodology to US Cryobanks in the formation of the company.
The Company's blood and semen banks are still receiving income from storage
clients. Operational income has decreased because the Company is unable to
obtain new clients. The Company has taken vigorous legal action to re-open its
facilities. The Company's income and assets are adequate to sustain the Company
during this period are adequate. The Company is capable of producing and
distributing its Blood Volume Analyzer at facilities outside of New York State
if Albumin I-131 becomes available for use with the BVA-100.
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<PAGE>
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.
DAXOR CORPORATION
(Registrant)
DATE: November 15, 1995 /S/ JOSEPH FELDSCHUH, M.D.
JOSEPH FELDSCHUH, M.D.
President
DATE: November 15, 1995 /S/ HERMOGENA FAJARDO
HERMOGENA FAJARDO
Vice President
DATE: November 15, 1995 /S/ OCTAVIA ATANASIU
OCTAVIA ATANASIU
Treasurer
DATE: November 15, 1995 /S/ PAMELA M. KROCHAK
PAMELA M. KROCHAK
Corporate Secretary
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 69,962
<SECURITIES> 37,187,278
<RECEIVABLES> 121,694
<ALLOWANCES> 0
<INVENTORY> 158,000
<CURRENT-ASSETS> 37,802,135
<PP&E> 1,020,477
<DEPRECIATION> 610,180
<TOTAL-ASSETS> 38,250,788
<CURRENT-LIABILITIES> 6,608,895
<BONDS> 0
<COMMON> 53,097
0
0
<OTHER-SE> 31,641,893
<TOTAL-LIABILITY-AND-EQUITY> 38,250,788
<SALES> 1,188,521
<TOTAL-REVENUES> 3,325,114
<CGS> 775,876
<TOTAL-COSTS> 2,127,033
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 62,619
<INCOME-PRETAX> 1,198,081
<INCOME-TAX> 107,624
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 222,352
<EPS-PRIMARY> 0.05
<EPS-DILUTED> 0.05
</TABLE>
