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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarter ended: March 31, 1999 Commission File Number: 1-8147
MEDIQ Incorporated
(Exact name of registrant as specified in its charter)
Delaware 51-0219413
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One MEDIQ Plaza, Pennsauken, New Jersey 08110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (609) 662-3200
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 requirements
for the past 90 days. YES X NO ____
As of May 4, 1999, there were outstanding 1,074,823 shares of Common Stock,
par value $.01.
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<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
Quarter Ended March 31, 1999
INDEX
<TABLE>
<CAPTION>
Page
Number
------
c<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Operations- 4
Three Months Ended December 31, 1999 and 1998
(Unaudited)
Condensed Consolidated Balance Sheets- 5
December 31, 1999 (Unaudited) and
September 30, 1998
Condensed Consolidated Statements of Cash Flows- 6
Six Months Ended March 31, 1999 and 1998
(Unaudited)
Notes to Condensed Consolidated Financial 7 - 8
Statements (Unaudited)
Item 2. Management's Discussion and Analysis of 9 - 12
Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk 12
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
</TABLE>
2
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
Quarter Ended March 31, 1999
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
3
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
1999 1998 1999 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenues:
Rental $ 45,954 $ 36,599 $ 87,141 $ 69,993
Sales 7,486 7,285 16,077 13,979
Other 2,633 2,525 5,305 5,007
--------- --------- --------- ---------
56,073 46,409 108,523 88,979
Costs and Expenses:
Cost of sales 5,948 5,779 12,392 11,270
Operating 13,835 14,003 30,295 28,449
Selling 6,091 3,938 13,065 7,557
General and administrative 5,926 4,534 12,374 9,348
Merger charges -- 306 -- 363
Depreciation and amortization 10,380 8,294 20,298 16,586
--------- --------- --------- ---------
42,180 36,854 88,424 73,573
--------- --------- --------- ---------
Operating Income 13,893 9,555 20,099 15,406
Other (Charges) and Credits:
Interest expense (13,555) (3,578) (26,812) (7,235)
Other-net 286 251 392 479
--------- --------- --------- ---------
Income (Loss) before Income Taxes 624 6,228 (6,321) 8,650
Income Tax Expense (Benefit) 220 2,799 (2,158) 3,888
--------- --------- --------- ---------
Net Income (Loss) 404 3,429 (4,163) 4,762
Dividends on Preferred Stock (4,486) -- (9,098) --
--------- --------- --------- ---------
Net (Loss) Income available for Common Shareholders $ (4,082) $ 3,429 $ (13,261) $ 4,762
========= ========= ========= =========
Basic Per Share Amount:
Net (loss) income available for common shareholders $ (3.80) $ .13 $ (12.34) $ .19
========= ========= ========= =========
Diluted Per Share Amount:
Net (loss) income available for common shareholders $ (3.80) $ .13 $ (12.34) $ .18
========= ========= ========= =========
Weighted Average Number of Common Shares Outstanding:
Basic 1,075 25,635 1,075 25,624
========= ========= ========= =========
Diluted 1,075 26,455 1,075 26,358
========= ========= ========= =========
</TABLE>
4
See Notes to Condensed Consolidated Financial Statements
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
March 31, September 30,
1999 1998
---------- ------------
(Unaudited) (See note below)
Assets
------
<S> <C> <C>
Current Assets:
Cash $ 2,761 $ 2,411
Accounts receivable (net of allowance of $8,153 and
$11,432 respectively) 66,847 52,659
Inventories 22,258 21,820
Other current assets 11,100 9,923
--------- ---------
Total Current Assets 102,966 86,813
Property, Plant and Equipment (net of accumulated depreciation
and amortization of $172,009 and $155,749, respectively 105,187 103,917
Goodwill (net of accumulated amortization of
$19,923 and $16,658, respectively) 115,923 91,121
Deferred Financing Costs (net of accumulated amortization
of $2,040 and $862, respectively) 19,154 20,013
Other Assets 7,848 7,354
--------- ---------
Total Assets $ 351,078 $ 309,218
========= =========
Liabilities and Stockholders' Deficiency
----------------------------------------
Current Liabilities:
Accounts payable $ 12,399 $ 14,152
Accrued expenses 20,473 20,569
Other current liabilities 212 281
Current portion of long term debt 2,176 2,037
--------- ---------
Total Current Liabilities 35,260 37,039
Senior Debt 327,765 277,490
Subordinated Debt 190,514 190,514
Deferred Taxes 11,861 14,019
Other Liabilities 4,145 2,472
Mandatorily Redeemable Preferred Stock 120,147 113,037
Stockhholders' Deficiency (338,614) (325,353)
--------- ---------
Total Liabilities and Stockholders' Deficiency $ 351,078 $ 309,218
========= =========
</TABLE>
Note: The balance sheet at September 30, 1998 has been condensed from the
audited financial statements at that date.
See Notes to Condensed Consolidated Financial Statements
5
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Six Months Ended March 31,
1999 1998
-------- --------
<S> <C> <C>
Cash Flows From Operating Activities
- ------------------------------------
Net (loss) income $ (4,163) $ 4,762
Adjustments to reconcile net (loss) income to net cash
provided by operating activities 6,589 9,969
-------- --------
Net cash provided by operating activities 2,426 14,731
Cash Flows From Investing Activities
- ------------------------------------
Purchases of equipment (14,746) (15,275)
Acquisitions (32,641) --
Collection of notes receivable -- 2,250
Other 468 384
-------- --------
Net cash used in investing activities (46,919) (12,641)
Cash Flows From Financing Activities
- ------------------------------------
Borrowings 46,300 11,000
Debt repayments (1,138) (12,934)
Other (319) 130
-------- --------
Net cash provided by (used in) financing activities 44,843 (1,804)
-------- --------
Increase in cash 350 286
Cash:
Beginning balance 2,411 3,639
-------- --------
Ending balance $ 2,761 $ 3,925
======== ========
</TABLE>
See Notes to Condensed Consolidated Financial Statements
6
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note A - Condensed Consolidated Financial Statements
The condensed consolidated balance sheet as of March 31, 1999 and the condensed
consolidated statements of operations and cash flows for the three and six
months ended March 31, 1999 and 1998 have been prepared by the Company, without
audit. In the opinion of management, all adjustments (consisting only of normal,
recurring adjustments) necessary to present fairly the financial position,
results of operations and cash flows at March 31, 1999 and for all periods
presented have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These condensed consolidated financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's September 30, 1998 Annual Report on Form 10-K.
The results of operations for the period ended March 31, 1999 are not
necessarily indicative of the operating results for the full year.
Certain reclassifications have been made to conform prior year balances to the
current year presentation.
Note B - Inventory
March 31, September 30,
1999 1998
--------- ---------
(in thousands)
Raw materials $ 1,716 $ 2,791
Finished goods 20,542 19,029
--------- ---------
$ 22,258 $ 21,820
========= =========
Note C - (Loss) Earnings Per Share
Options and warrants to purchase shares of the Company's Common Stock were
excluded from the computation of diluted earnings per share ("EPS") for the
three and six months ended March 31, 1999 because they were antidilutive. The
number of options and warrants outstanding at March 31, 1999 were 51,557 and
91,209, respectively. The weighted average number of common shares outstanding
for diluted EPS for the three and six months ended March 31, 1998 includes
820,000 and 734,000, respectively, incremental shares for the assumed exercise
of stock options outstanding during the respective periods. The disparity in per
share amounts for the respective periods presented in the Condensed Consolidated
Statements of Operations is attributable to the Company's recapitalization that
occurred on May 29, 1998.
Note D - Long Term Debt
On January 31, 1999, the Company borrowed $27.8 million under its acquisition
loan facility to fund two acquisitions. (see Note E) The weighted average
variable interest rate incurred on this borrowing during the three months ended
March 31, 1999 was 7.61%, and the rate at March 31, 1999 was 7.31%.
Note E - Acquisitions
The Company acquired two businesses in the second quarter of fiscal 1999. The
assets and businesses acquired principally relate to equipment rentals. The
acquisitions were accounted for by the purchase method and, accordingly, the
purchase prices were allocated to the assets acquired based on their estimated
fair values on the dates of purchase. The aggregate excess of purchase prices
over estimated fair values of net assets acquired was recorded as goodwill
7
<PAGE>
amortizable on a straight line basis over 20 years. Operations of the acquired
assets and businesses have been included in the Company's results of operations
from the respective acquisition dates. Proforma results of operations of the
Company giving effect to the acquisitions are not presented because the
acquisitions in the aggregate were not material.
8
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion addresses the financial condition of the Company as of
March 31, 1999 and results of operations for the three and six month periods
ended March 31, 1999 and 1998. This discussion should be read in conjunction
with the financial statements included elsewhere herein and the Management's
Discussion and Analysis and Financial Statement sections of the Company's Annual
Report on Form 10-K for the year ended September 30, 1998, to which the reader
is directed for additional information.
The following information contains forward looking statements, within the
meaning of the Private Securities Litigation Reform Act of 1995, that are
subject to risks and uncertainties. Although the Company believes that its
expectations are based on reasonable assumptions within the bounds of its
knowledge of its business and operations, there can be no assurance that actual
results will not differ materially from its expectations. Readers are cautioned
not to place undue reliance on these forward looking statements, which speak
only as of the date of this report.
Seasonality
In the past, the Company's rentals have been somewhat seasonal, with demand
historically peaking during periods of increased hospital census, which
generally occur in the winter months during the Company's second fiscal quarter.
Results of Operations
Fiscal 1999 Compared to Fiscal 1998
Total revenues increased in the second quarter of fiscal 1999 by $9.7 million,
or 20.8%, to $56.1 million. This growth was primarily attributable to an
increase in rental revenues of $9.4 million, or 25.6%. Total revenues increased
in the six months ended March 31, 1999 by $19.5 million, or 22.0%, to $108.5
million. This growth was primarily attributable to an increase in rental
revenues of $17.1 million, or 24.5%. These rental revenue increases were
principally due to the Company's acquisitions since May 1998 of five equipment
rental businesses that specialized in the rental of support surfaces.
The Company completed two acquisitions in the second quarter of fiscal 1999 that
are expected to contribute combined annual revenues of approximately $9.0
million, based on the most recent annual revenues available for each
acquisition.
Total costs and expenses, exclusive of depreciation and amortization, increased
in the second quarter of fiscal 1999 by $3.2 million to $31.8 million, and
increased in the six months ended March 31, 1999 by $11.1 million to $68.1
million. Included in both current year periods is a reduction of expense from a
recovery of $3.0 million from a settlement of disputed items related to an
acquisition that had been reserved for by the Company last fiscal year. Included
in the second quarter of fiscal 1998 and six months ended March 31, 1998 are non
recurring merger related charges of $.3 million and $.4 million, respectively.
Exclusive of the settlement recovery and non recurring merger charges, the
increase in total costs and expenses in the second quarter of fiscal 1999 was
$6.5 million, or 23.2%, and the increase in the six months ended March 31, 1999
was $14.5 million, or 25.6%. These increases were broad based and associated
with the increased operational requirements of the Company as a result of both
actual growth in business and further growth that is anticipated. Selling
expenses in the second quarter of fiscal 1999 increased $2.2 million, or 54.7%,
to $6.1 million, and in the six months ended March 31, 1999 increased $5.5
million, or 72.9%, to $13.1 million. The increase in each period was due to
increased sales support on a national basis related to the Company's expanding
equipment rental operations related to support surfaces rentals. In total,
operating expenses, exclusive of the settlement recovery, and general and
administrative expenses increased in the second quarter of fiscal 1999 by $4.2
million, or 22.8%, to $22.8 million, and increased in the six months ended March
31, 1999 by $7.9 million, or 20.8%, to $45.7 million. These increases were
primarily due to: (i) employee related costs associated with a larger work force
employed to meet the increased operational requirements and further growth needs
of the Company; (ii) increased equipment service requirements associated with a
larger and expanded product fleet and (iii) management fees resulting from the
Company's merger.
9
<PAGE>
Depreciation and amortization increased in the second quarter of fiscal 1999 by
$2.1 million, or 25.2%, to $10.4 million, and increased in the six months ended
March 31, 1999 by $3.7 million, or 22.4%, to $20.3 million. These increases
resulted from additional depreciable equipment purchased and obtained in
acquisitions and increased goodwill associated with the Company's acquisitions
since May 1998.
Operating margin, exclusive of the settlement recovery in the current year and
non recurring merger charges in the prior year, decreased in the second quarter
of fiscal 1999 to 19.4% from 21.2% in the corresponding prior year quarter, and
decreased in the six months ended March 31, 1999 to 15.8% from 17.7% in the
corresponding six months ended of the prior year. These decreases were primarily
due to the increased infrastructure costs in support of actual business growth
and the further anticipated growth, and increased depreciation and amortization,
partially offset by the increase in the higher margin rental activities of the
Company. Earnings before interest, taxes, depreciation, amortization and other
charges and credits ("EBITDA"), exclusive of the settlement recovery and non
recurring merger charges, were $21.3 million for the second quarter of fiscal
1999 compared to $18.2 million for the corresponding prior year quarter, and
$37.4 million for the six months ended March 31, 1999 compared to $32.4 million
for the corresponding prior year period. Although EBITDA is a widely accepted
financial indicator of a company's ability to service indebtedness, it should
not be considered as an alternative to income from operations or to cash flows
from operating activities, and should not be construed as an indication of a
company's performance or as a measure of liquidity.
Interest expense increased by $10.0 million in the second quarter of fiscal 1999
to $13.6 million and increased by $19.6 million in the six months ended March
31, 1999 to $26.8 million from their respective prior year periods, principally
due to the substantially higher level of debt incurred in connection with the
Company's recapitalization and acquisitions. The cash portion of this interest
expense was $10.3 million and $20.2 million for the three and six months ended
March 31, 1999, respectively. The remaining interest expense represented non
cash accretion of the Company's 13% Senior Discount Debentures and amortization
of deferred debt issuance costs.
The effective income tax rate for the second quarter of fiscal 1999 was 35.3%
and 34.1% for the six months ended March 31, 1999, compared to 44.9% in each of
the corresponding prior year periods. The rates in the current year periods were
lower primarily due to losses for state income tax purposes, whereas there was
taxable income for state tax purposes in the prior year periods.
Accreted but unpaid dividends on preferred stock for the three and six months
ended March 31, 1999 were $4.5 million and $9.1 million, respectively, compared
to none in the corresponding prior year periods. These amounts reflected
accretion of dividends on the three cumulative preferred stock series issued in
connection with the Company's recapitalization in May 1998.
For the six months ended March 31, 1999, there was a loss available to common
shareholders of $13.3 million. Due to the amount of cash and non cash interest
and non cash preferred stock dividend requirements, combined with non cash
depreciation and amortization, it is likely that the Company will continue to
report a net loss available to common shareholders.
The disparity in the weighted average number of common shares used in the
earnings per share computations for each period resulted from the Company's
merger and recapitalization in May 1998.
Liquidity and Capital Resources
Net cash provided by operating activities in the six months ended March 31, 1999
was $2.4 million compared to $14.7 million in the six months ended March 31,
1998. This variance was principally due to interest payments in the current year
exceeding those in the prior year because of substantially greater amounts of
indebtedness outstanding. Also contributing to the reduced level of net cash
from operations during the current year when compared to the prior year was an
increase in working capital requirements principally related to an increase in
accounts receivable.
10
<PAGE>
The Company used its acquisition loan facility to fund $27.8 million of
acquisitions and its revolving credit facility to fund $4.8 million of
acquisitions, certain purchases of equipment and general corporate purposes. At
March 31, 1999, borrowings outstanding under the acquisition and revolving
credit facilities were $27.8 million and $18.5 million, respectively. At March
31, 1999, availability under the revolving credit facility was $17.7 million and
$22.2 million under the acquisition loan facility. The weighted average interest
rate on the term loan facility at March 31, 1999 was 7.88% compared to 8.50% at
September 30, 1998. The term loan rate became fixed at 7.88% on December 10,
1998 and will remain fixed at this rate until June 10, 1999, at which time the
rate will be subject to adjustment. The weighted average variable interest rate
on the revolving credit facility incurred in the second quarter of fiscal 1999
was 8.00%, and the rate at March 31, 1999 was 7.57% compared to 8.15% at
December 31, 1998 and 9.00% at September 30, 1998. The weighted average variable
interest rate on the acquisition loan facility incurred in the second quarter of
fiscal 1999 was 7.61%, and the rate at March 31, 1999 was 7.31%. No amount was
outstanding under the acquisition loan facility until January 31, 1999.
Decreases in the current year's weighted average variable interest rates are due
to the Company's ability to take partial advantage of incrementally lower LIBOR
rates as opposed to more stable higher prime rates.
The Company expects to grow both internally and through acquisitions and,
therefore, continues to investigate potential acquisition opportunities. It is
likely that the Company will incur additional indebtedness to consummate any
future significant acquisitions, thereby adding to the existing debt service
requirements. The Company expects that ensuing cash flows generated from any
acquisitions consummated will be sufficient to cover additional debt service,
that total Company leverage will decrease and that the acquisitions will provide
additional shareholder value. However, no assurance can be given that any
acquisitions consummated will be successful or provide the value anticipated.
Year 2000
The Company continues to evaluate the risks associated with its operations as a
result of Year 2000 compliance issues. The Company has evaluated these risks on
three levels: internal and existing computer programs and applications; rental
equipment and customers and suppliers. In evaluating these risks, the Company
considered the material implications of each of these items on its operations on
and subsequent to January 1, 2000. The Company's internal business information
systems have been analyzed for Year 2000 compliance and the Company believes
that these systems are Year 2000 compliant. The Company commenced testing of the
compliance readiness of the internal business information systems in January
1999, and will continue testing on an ongoing basis. The Company utilizes
certain third party network equipment and software products, which may or may
not be Year 2000 compliant. While delays in the implementation of the Year 2000
solutions for such systems which may not be Year 2000 compliant could adversely
effect the Company's operations, at this time, the Company believes that
resolution of this Year 2000 issue will not have a material adverse effect on
the Company's operations or results of operations.
A significant portion of the Company's revenues and operating income is directly
related to the Company's ability to rent its equipment. Should a material
portion of such equipment not be Year 2000 compliant and, therefore, not
suitable for its designed purpose, there could be a material adverse effect on
the Company's results of operations. The Company believes that support surfaces
rental equipment that has been manufactured by the Company is fully Year 2000
compliant. The Company has initiated formal communications with the equipment
manufacturers for products the Company maintains in its inventory to determine
the extent to which the Company's purchased rental equipment may be vulnerable
to Year 2000 issues. To date, approximately 94% of the equipment manufacturers
have responded to the Company's requests. As of March 31, 1999, based on the
responses received by manufacturers of the related equipment, approximately 86%
of the Company's rental fleet is fully Year 2000 compliant, as represented by
the manufacturers. The Company has no means to validate these representations
and must rely on the statements made by the manufacturers. For manufacturers
that have not yet responded, the Company has a formal follow up plan that is
currently being executed. The Company expects to complete the evaluation process
of its rental fleet by July 31, 1999. To date, based on responses from the
equipment manufacturers, the Company believes it would need to spend
approximately $4.0 million to bring its entire rental fleet into Year 2000
compliance, should the Company decide to do so. The Company anticipates that all
known modifications to make its entire rental fleet Year 2000 compliant could be
completed by October 31, 1999. The Company may decide not to modify its entire
11
<PAGE>
rental fleet, based on yet to be determined anticipated utilization of compliant
equipment. Such determination would impact the amount expended on modifications
and the timing of completion thereof. Currently, the Company is not able to
estimate the costs associated with Year 2000 issues for rental equipment whose
manufacturers have not yet replied. Percentages and anticipated timetables
mentioned above have been adjusted from those contained in previous disclosures
as a result of additional equipment obtained with recent acquisitions by the
Company and to conform to the pace of compliance efforts of certain suppliers to
the Company. The status of compliance is subject to further adjustment in
accordance with future changing circumstances that cannot now be reliably known
or anticipated.
Although the Company has significant relationships with certain of its customers
and suppliers, the Company has determined that no one individual customer or
supplier could create a material adverse effect for the Company as a result of
not being Year 2000 compliant. However, should a number of individual customers
and/or suppliers be noncompliant, there could be a material adverse effect on
the Company's operations and results of operations. The Company cannot predict
the extent or dollar amount, if any, of such effect.
Should a material portion of the Company's rental fleet not be Year 2000
compliant and, therefore, not suitable for its designed purpose, an interruption
in or a failure of certain normal business activities or operations could occur.
There can be no assurance that the systems of other companies on which the
Company relies will be Year 2000 compliant and, therefore, not have a material
adverse effect on the Company. The Company cannot predict the extent or dollar
amount, if any, of such effect.
The cost of compliance and the date on which the compliance will be completed
are based on estimates, which were derived utilizing numerous assumptions of
future events including the continued availability of certain resources and
other factors. However, there can be no assurance that these estimates will be
achieved. Actual results could differ materially from the projections. Specific
factors that might cause a material change include, but are not limited to, the
availability and cost of personnel trained in this area, the ability to obtain
all necessary components or upgrade parts and similar uncertainties.
The Company has investigated developing contingency plans for dealing with worst
case scenarios regarding its rental fleet and overall operations. With respect
to its equipment rentals, the Company believes that it is not necessary or
practical to implement contingency measures; however, the Company will make
available all of its Year 2000 compliant equipment to customers that desire to
have sufficient back up units on hand for their own contingency plans.
Concerning its internal systems, the Company performs ongoing testing of these
and believes them to be Year 2000 compliant, so the Company believes that a
contingency plan for their operation is not necessary. With respect to other
operational aspects, the Company believes that developing a contingency plan for
a worst case scenario is not feasible, and based on representations made by
external service providers to the Company (for example, electricity and
telecommunications), circumstances creating such an event are considered by the
Company to be remote. Nevertheless, the absence of a contingency plan could have
a material adverse effect on the Company's operations.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There were no changes during the three and six months ended March 31, 1999 in
the way the Company manages its interest rate risk. At March 31, 1999, the
Company's aggregate weighted average variable interest rate was 7.79% compared
to 8.50% at September 30, 1998. The decrease in this rate is due to the
Company's ability to take advantage of incrementally lower LIBOR rates
concerning its term loan, revolving credit and acquisition loan facilities.
12
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
Quarter Ended March 31, 1999
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial Data Schedule appears on page 15
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended March 31, 1999.
13
<PAGE>
MEDIQ INCORPORATED AND SUBSIDIARIES
Quarter Ended March 31, 1999
SIGNATURE
---------
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.
MEDIQ Incorporated
-------------------------------
(Registrant)
May 17, 1999 /s/ Jay M. Kaplan
- ------------ -------------------------------
(Date) Jay M. Kaplan
Senior Vice President-Finance,
Treasurer and Chief Financial
Officer
14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> MAR-31-1999
<CASH> 2,761
<SECURITIES> 0
<RECEIVABLES> 66,847
<ALLOWANCES> 8,153
<INVENTORY> 22,258
<CURRENT-ASSETS> 102,966
<PP&E> 105,187
<DEPRECIATION> 172,009
<TOTAL-ASSETS> 351,078
<CURRENT-LIABILITIES> 35,260
<BONDS> 518,279
120,147
0
<COMMON> 0
<OTHER-SE> (338,614)
<TOTAL-LIABILITY-AND-EQUITY> 351,078
<SALES> 16,077
<TOTAL-REVENUES> 108,523
<CGS> 12,392
<TOTAL-COSTS> 88,424
<OTHER-EXPENSES> (392)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 26,812
<INCOME-PRETAX> (6,321)
<INCOME-TAX> (2,158)
<INCOME-CONTINUING> (4,163)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,163)
<EPS-PRIMARY> (12.34)
<EPS-DILUTED> (12.34)
</TABLE>
