UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number: 0-14210
COMPUMED, INC.
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(Exact name of registrant as specified in its charter)
Delaware 95-2860434
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State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1230 Rosecrans Avenue, Suite 1000, Manhattan Beach, CA 90266
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(Address of principal executive officers) (Zip Code)
(310) 643-5106
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(Registrant's telephone number, including area code)
Not applicable
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(Former name, former address and former fiscal year, if change 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
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The registrant had 6,886,556 shares of common stock ($.01 par value)
issued and outstanding and to be issued as of August 9, 1995.
Total sequentially number pages in this document: 10
INDEX
COMPUMED, INC. AND SUBSIDIARY
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Consolidated condensed balance sheets - June 30, 1995 and
September 30, 1994.
Consolidated condensed statement of operations - three and nine
months ended June 30, 1995 and 1994.
Consolidated condensed statements of changes of cash flows - nine
months ended June 30, 1995 and 1994.
Notes to interim unaudited consolidated condensed financial
statements.
Item 2.
Management's Discussion and Analysis of Financial Condition and
Results of Operations.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
SIGNATURES
CONSOLIDATED CONDENSED BALANCE SHEETS
COMPUMED, INC. AND SUBSIDIARIES
June 30, September 30,
1995 1994
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(Unaudited)
ASSETS
CURRENT ASSETS
Cash $ 256,000 $ 16,000
Interest receivable 7,000
Accounts receivable, less allowance of
$210,000 June (1995) and
$178,000 September (1994) 454,000 424,000
Other receivables 25,000 55,000
Inventories 228,000 247,000
Prepaid expenses and other current assets 34,000 12,000
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TOTAL CURRENT ASSETS 997,000 761,000
PROPERTY AND EQUIPMENT
Land 1,380,000 1,380,000
Buildings 3,820,000 3,820,000
Machinery and equipment 3,274,000 2,964,000
Furniture, fixtures and leasehold
improvements 198,000 198,000
Equipment under capital leases 537,000 537,000
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9,209,000 8,899,000
Less allowance for depreciation and
amortization 3,676,000 3,351,000
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5,533,000 5,548,000
OTHER ASSETS
Reacquired franchises, net of accumulated
amortization of $105,000 (June 1995)
and $70,000 (September 1994) 221,000 256,000
Other assets 387,000 301,000
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$7,138,000 $6,866,000
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See notes to consolidated financial statements
CONSOLIDATED CONDENSED BALANCE SHEETS
COMPUMED, INC. AND SUBSIDIARIES
June 30, September 30,
1995 1994
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LIABILITIES AND STOCKHOLDERS' EQUITY (Unaudited)
CURRENT LIABILITIES
Notes payable $ 7,000 $ 21,000
Accounts payable 493,000 269,000
Deferred revenue 167,000 240,000
Other accrued liabilities 368,000 388,000
Current portion of long term debt 188,000 232,000
Current portion of capital
lease obligations 21,000 22,000
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TOTAL CURRENT LIABILITIES 1,244,000 1,172,000
TRUST DEED NOTES PAYABLE, less
current portion 3,414,000 3,466,000
CAPITAL LEASE OBLIGATIONS, less
current portion 47,000 62,000
OTHER LIABILITIES 324,000 253,000
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, $.10 par value-
authorized 1,000,000 shares
Class A $3.50 cumulative
convertible voting preferred
stock, issued and outstanding --
8,400 shares (June 1995) and
(September 1994) 1,000 1,000
Class B $3.50 convertible voting
preferred stock, issued and
outstanding 52,333 (June 1995)
and (September 1994) 5,000 5,000
Common stock, $.01 par value--
authorized 60,000,000 shares,
issued and outstanding--
6,763,993 shares (June 1995) and
4,642,493 shares (September 1994) 68,000 46,000
Additional paid in capital 19,245,000 17,988,000
Retained deficit (17,210,000) (16,127,000)
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STOCKHOLDERS' EQUITY 2,109,000 1,913,000
$ 7,138,000 $ 6,866,000
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See notes to consolidated financial statements
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
COMPUMED, INC. AND SUBSIDIARY
Three Months Ended Nine Months Ended
June 30, June 30,
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1995 1994 1995 1994
---- ---- ---- ----
REVENUES FROM OPERATIONS
ECG service $435,000 $ 370,000 $1,245,000 $ 1,070,000
Osteo services, net 86,000 155,000 355,000 414,000
Product sales 311,000 80,000 431,000 207,000
Rental property 117,000 355,000
Other income (5,000) 1,000 (2,000) 3,000
944,000 606,000 2,384,000 1,694,000
COSTS AND EXPENSES
Cost of services 365,000 414,000 1,029,000 1,103,000
Cost of sales 217,000 46,000 282,000 122,000
Cost of property operations 71,000 218,000
Selling expenses 116,000 98,000 321,000 355,000
General and administrative
expenses 332,000 405,000 1,170,000 1,250,000
Research and development 54,000 150,000 159,000 514,000
Acquisition of detoxahol
rights 100,000 1,669,000
Interest expense 85,000 2,000 285,000 141,000
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1,240,000 1,215,000 3,464,000 5,154,000
NET LOSS $(296,000) $(609,000) $(1,080,000) $(3,460,000)
_________ __________ ____________ ____________
_________ __________ ____________ ____________
NET LOSS PER SHARE: $ (.05) $ (.12) $ (.19) $ (.82)
__________ __________ ____________ ____________
__________ __________ ____________ ____________
Weighted average number
of common shares
outstanding 6,430,200 5,146,600 5,613,000 4,206,600
_________ _________ _________ _________
_________ _________ _________ _________
See notes to interim consolidated condensed financial statements
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
COMPUMED, INC. AND SUBSIDIARIES
Nine Months Ended
June 30, June 30,
1995 1994
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OPERATING ACTIVITIES:
Net Loss $ (1,080,000) $(3,460,000)
Adjustment to reconcile loss to net
cash used in operating activities:
Depreciation and amortization 373,000 187,000
Cost of detoxahol rights 1,669,000
Issuance of common stock for
services 14,000
Changes in operating assets and
liabilities:
Interest receivable 7,000 19,000
Notes receivable 345,000
Accounts receivable (30,000) (15,000)
Other receivables 30,000 110,000
Inventories and prepaid expenses (3,000) 39,000
Accounts payable and other liabilities 202,000 129,000
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NET CASH USED IN OPERATING ACTIVITIES (501,000) (963,000)
INVESTING ACTIVITIES:
Purchases of property, plant,
and equipment (170,000) (25,000)
Increase in other assets (9,000) (47,000)
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NET CASH USED IN INVESTING ACTIVITIES (179,000) (72,000)
FINANCING ACTIVITIES:
Net proceeds from sale of stock 981,000 1,432,000
Dividends on Class A preferred stock (3,000) (3,000)
Proceeds from short term borrowings 175,000
Payments on short-term borrowings (175,000) (401,000)
Principal payments on capital
lease obligations (36,000) (12,000)
Principal payments on trust
deeds payable (96,000)
Principal payments on notes payable (14,000) (10,000)
Exercise of stock options and warrants 88,000 119,000
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NET CASH PROVIDED BY FINANCING
ACTIVITIES 920,000 1,125,000
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INCREASE IN CASH 240,000 90,000
Cash at beginning of period 16,000 20,000
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CASH AT END OF PERIOD $ 256,000 $ 110,000
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Cash paid for interest: $285,000 $ 141,000
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In March 1995 the Company acquired the rights to market ambulatory cardiac
monitoring products with the issuance of 400,000 shares of common stock.
See notes to consolidated condensed financial statements
NOTES TO INTERIM UNAUDITED CONSOLIDATED CONDENSED
FINANCIAL STATEMENTS
COMPUMED, INC. AND SUBSIDIARIES
NOTE A--BASIS OF PREPARATION
The balance sheet at September 30, 1994 has been abstracted from the
Company's year-end audited financial statements.
The accompanying interim unaudited consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and pursuant to the rules and regulations
of the Securities and Exchange Commission. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the period ended June 30 , 1995 are not necessarily indicative
of the results that may be expected for the year ending September 30,
1995. For further information, refer to the consolidated financial
statements for the year ended September 30, 1994 and the notes thereto
included in the Annual Report on Form 10-KSB.
NOTE B--PER SHARE DATA
Net loss income per share is calculated using the net loss less preferred
stock dividends, divided by the weighted average common shares
outstanding. Shares from the assumed conversion of outstanding
warrants, options and effect of the conversion of the Class A and Class
B Preferred Stock are omitted from the computations because the effect
would be antidilutive.
Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Results of Operations
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Revenues from operations for third quarter and nine months ended
June 30, 1995, increased by 56% and 41% respectively, as compared to
the same periods last year, of which $117,000 was rental property income
resulting from the acquisition of Irsco Development Company, Inc. in the
last quarter of fiscal 1994. Product sales increased $256,000 for the
nine months ended June 30, 1995, due to the sale and installation of
OsteoSystem units in three international sites. ECG revenues have
increased 16% in this fiscal year and management continues to believe
there is a future opportunity in this market.
Net loss from operations for the third quarter and nine months ended June
30, 1995, decreased 42% and 41% respectively as compared to the same
periods last year. This comparison does not include $1,669,000 of expenses
that resulted from the acquisition and immediate write-off of the rights to
Detoxahol. The sales of the three OsteoSystems and the decrease in
expenses of $352,000 in Detoxahol this year as compared to last year, made
up most of the loss reduction for the fiscal year.
Financial Condition and Liquidity
---------------------------------
The Company's ratio of current assets to current liabilities was 0.8 to 1.0
as compared to 0.6 to 1.0 at September 30, 1994. While the increase in
current ratio remained nearly the same, the cash balance increased by
$240,000 from the same quarter last year as a result of the $1,000,000
received upon the sale of 1,663,607 shares of common stock in a Regulation
"S" agreement. Accrued liabilities increased $162,000 for attorney fees
for the law suit relating to Detoxahol. Equipment purchases of $102,000
were made in conjunction with the start-up of TeleCor in March.
On August 11, 1995 the Company raised $5.1 million for 1.2 million shares
of common stock in a private placement with certain institutional
investors and their affiliates.
Management believes that the cash received from collections of accounts
receivable generated operations and from the stock placements will be
sufficient to fund existing operating requirements. The Company currently
does not have a borrowing line. The Company's primary capital resource
commitments at June 30, 1995 consist of remaining lease commitments,
primarily for computer and office equipment and the commitments with
regards to liabilities assumed pursuant to the rental property (Irsco)
acquired. The Company currently does not have, and does not anticipate
significant commitments for capital expenditures.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
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.
COMPUMED, INC.
BY /s/ Rod N. Raynovich
Rod N. Raynovich, President and
Chief Executive Officer
August 9, 1995
/s/ DeVere B. Pollom
BY DeVere B. Pollom, Chief Financial
Officer
August 9, 1995
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.
COMPUMED, INC.
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(Registrant)
/s/ Rod N. Raynovich
______________________________
Rod N. Raynovich
President
/s/ DeVere B. Pollom
______________________________
DeVere B. Pollom
Chief Financial Officer
Date: August 9, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
COMPUMED, INC. FORM 10-QSB FOR THE QUARTER ENDED JUNE 30, 1995 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
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<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUL-01-1995
<CASH> 256,000
<SECURITIES> 0
<RECEIVABLES> 479,000
<ALLOWANCES> 0
<INVENTORY> 228,000
<CURRENT-ASSETS> 997,000
<PP&E> 9,209,000
<DEPRECIATION> 3,676,000
<TOTAL-ASSETS> 5,533,000
<CURRENT-LIABILITIES> 1,244,000
<BONDS> 0
<COMMON> 68,000
6,000
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<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 7,138,000
<SALES> 2,386,000
<TOTAL-REVENUES> 2,384,000
<CGS> 1,629,000
<TOTAL-COSTS> 1,629,000
<OTHER-EXPENSES> 1,835,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 285,000
<INCOME-PRETAX> (1,080,000)
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,080,000
<EPS-PRIMARY> (.19)
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