<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
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 0-11365
LASER PHOTONICS, INC.
-------------------------------------------------------
(exact name of registrant as specified in its charter)
Delaware 59-2058100
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
12351 Research Parkway, Orlando, Florida 32826
- ---------------------------------------- -------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (407) 281-4103
N/A
(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 No X
----- -----
As of September 30, 1996, 5,806,583 shares of Common Stock, par value $.01 per
share, were outstanding.
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INDEX
Page
Number
------
PART I FINANCIAL INFORMATION
Item 1 Financial Statements:
Condensed Balance Sheets 3-4
as of September 30, 1996 (Unaudited) and December 31, 1995
Statements of Operations for the 5
Nine Months ended September 30, 1996 (Unaudited)
Statements of Cash Flow for the 6
Nine Months ended September 30, 1996 (Unaudited)
Notes to Condensed Financial Statements 7-8
Item 2. Management's Discussion and Analysis 9-10
of Financial Condition and Results of Operations
PART II OTHER INFORMATION
. Exhibits and Reports of Form 8-K 11
SIGNATURES
2
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PART I FINANCIAL INFORMATION
Item I Financial Statements
LASER PHOTONICS, INC.
CONDENSED
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
----------- -----------
ASSETS (UNAUDITED)
<S> <C> <C>
CURRENT ASSETS
Cash and cash Equivalent $60,834 $61,087
Accounts Receivable - net $641,882 $256,370
Inventory $952,527 $855,866
Prepaid expenses $48,063 $24,201
----------- -----------
TOTAL CURRENT ASSETS $1,703,306 $1,197,524
PROPERTY, PLANT & EQUIPMENT $801,661 $775,627
Less accumulated depreciation
($381,187) ($162,892)
----------- -----------
NET FIXED $420,474 $612,735
OTHER ASSETS
Other $44,382 $36,008
Goodwill $3,243,076 $3,949,841
----------- -----------
TOTAL ASSETS $5,411,238 $5,796,108
=========== ===========
</TABLE>
3
<PAGE>
LASER PHOTONICS, INC.
CONDENSED
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
----------- -----------
LIABILITIES & SHAREHOLDERS EQUITY (UNAUDITED)
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $691,557 $507,331
Accrued warranty $83,972 $93,759
Accrued compensation and payroll withholdings $167,962 $395,876
Accrued expenses $1,564,099 $626,351
Current portion of long-term debt $139,622 $609,932
and capital lease obligation
----------- -----------
TOTAL CURRENT LIABILITIES $2,647,212 $2,233,249
INTERCOMPANY LIABILITY $2,459,485 $1,935,611
LONG TERM DEBT $877,651 $941,395
SHAREHOLDERS EQUITY (DEFICIT)
Common stock $.01 par value, 10,000,000 shares
authorized: 5,806,583 shares issued
and outstanding at September 30, 1996
5,000,000 shares outstanding in 1995 $58,066 $50,000
Additional paid - in- capital $3,980,744 $2,760,028
Deficit ($4,611,920) ($2,124,175)
----------- -----------
NET EQUITY ($573,110) $685,853
----------- -----------
TOTAL LIABILITIES & SHAREHOLDERS EQUITY $5,411,238 $5,796,108
=========== ===========
</TABLE>
4
<PAGE>
LASER PHOTONICS, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine month Three months
ended ended
Sept. 30,1996 Sept. 30,1996
----------- -----------
<S> <C> <C>
Sales $2,161,608 $779,294
Cost of Sales $1,666,027 $651,169
----------- -----------
GROSS PROFIT $495,581 $128,125
Selling, general & administrative $1,618,649 $544,722
Research & development $273,904 $125,555
----------- -----------
INCOME FROM OPERATIONS ($1,396,972) ($419,167)
Interest expense - net $305,802 $241,881
Amortization $706,763 $233,215
Other $78,560 ($58,319)
----------- -----------
NET INCOME (LOSS) BEFORE EXTRAORDINARY ITEM ($2,488,097) ($952,582)
EXTRAORDINARY ITEM $0 $0.00
----------- -----------
NET INCOME (LOSS) ($2,488,097) ($952,582)
=========== ===========
Primary earnings per common share:
Income (loss) before extraordinary item ($0.46) ($0.17)
Extraordinary item $0.00 $0.00
----------- -----------
Net Income (Loss) ($0.46) ($0.17)
=========== ===========
Average Number of Shares 5,408,775 5,633,500
Fully dilutive earnings per common share:
Income (loss) before extraordinary item ($0.46) ($0.17)
Extraordinary item $0.00 $0.00
----------- -----------
Net Income (Loss) ($0.46) ($0.17)
=========== ===========
Average Number of Shares 5,408,775 5,633,500
</TABLE>
5
<PAGE>
LASER PHOTONICS, INC.
STATEMENTS OF CASH FLOW
(UNAUDITED)
<TABLE>
<CAPTION>
Nine months ended
Sept. 30, 1996
-----------
<S> <C>
OPERATING ACTIVITIES
Net income (loss) ($2,488,097)
Depreciation $218,295
Amortization $706,763
-----------
Cash Flow-Operations ($1,563,039)
Changes in current assets ($506,035)
Changes in current liabilities $413,963
Changes in long-term liabilities ($63,744)
-----------
Net from operating activities ($1,718,855)
Capital Expenditures ($26,034)
Intercompany-net $523,874
Equity $1,229,136
Other Assets ($8,374)
-----------
Increase (Decrease) in cash ($253)
===========
Cash at beginning $61,087
Cash at end of quarter $60,834
-----------
Cash Increase (Decrease) ($253)
===========
</TABLE>
6
<PAGE>
NOTES TO CONDENSED FINANCIAL STATEMENTS
LASER PHOTONICS, INC.
September 30, 1996
1. CONDENSED FINANCIAL STATEMENTS
The condensed balance sheets as of September 30, 1996 and December 31, 1995,
and the related statements of operations and cash flow for the nine months
ended September 30, 1996 have been prepared by the Company, without audit. In
the opinion of management, the condensed financial statements contain all
adjustments, consisting of normal recurring accruals, necessary to present
fairly the financial position of Laser Photonics, Inc. at September 30, 1996
and the results of operations and cash flow for the nine months ended
September 30, 1996.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these condensed financial
statements be read in conjunction with the financial statements and notes
thereto included in the Company's report on Form 10-K/A-1 for the year ended
December 31, 1995. Subsequent events occurring after that date have been
considered and disclosed where necessary in the revised Form 10-K and/or the
revised 10-Q filing as appropriate.
2. INVENTORIES
Inventories consist of the following:
September 30, December 31,
1996 1995
-------- --------
Raw Materials $410,245 $477,456
Work in Process $371,875 $310,623
Finished Goods $170,407 $ 67,785
-------- --------
$952,527 $855,864
======== ========
7
<PAGE>
3. PER SHARE AMOUNTS
Earnings per common share for 1996 are based on the weighted average number of
shares of Common Stock outstanding of 5,408,775.
Earnings per common share for 1995 are based on the weighted average number of
shares of Common Stock outstanding 5,510,465. During 1995 (5/23) shares were
reduced from 6,312,112 to 5,000,000.
4. INCOME TAXES
During the first quarter of 1996, the Company adopted FASB No. 109, "Accounting
for Income Taxes," where deferred income taxes are provided for temporary
differences between amounts reported for financial statement and income tax
purposes. The impact of adopting this statement will not be significant to the
Company. The Company has elected to reserve the benefits of net operating loss
carry-forwards. These benefits will be recognized when the Company returns to
profitable operations.
8
<PAGE>
Item 2 Management's Discussion and Analysis of Financial Condition
and results of Operations
Results of Operations
During the nine months and three months ended September 30,1996, there were
consolidated losses of $2,488,097 and $1,075,567. Laser Photonics subsidiary,
Acculase, was responsible for $1,492,692 and $598,435 respectively. Since
Acculase was not acquired until May 23,1995, there is no comparable data for
this period. Therefore, the following comments pertain to Laser Photonics
exclusive of Acculase.
For the nine months and three months ended September 30, 1996, Laser Photonics
had net losses of $995,405 and $477,132 respectively. (Includes goodwill
amortization of $317,001 and $103,294 which are new charges due to fresh start
accounting).This compares to the 1995 nine month net income total of $4,446,789
and a three month loss of $334,059. The prior year included an extraordinary
gain in May due to debt forgiveness of $5,754,962.
For the nine months and three months ended September 30,1996, there were
operational losses of $425,448 and $205,043 respectively. This compares to the
1995 periods of $1,086,879 and $306,644 respectively. During 1996 there were
operational income improvements of $661,431 and $101,601 respectively.
Sales for the nine month and three month periods increased by approximately
$93,527 and $274,723 respectively. The improvement in the third quarter was
accomplished by factoring our receivables to obtain cash in order to finalize
sales in process. Sales backlog as of September 30, 1996 totaled $2,165,673.
Gross margins, as a percent of sales increased to 23% and 16% for the nine
month and three month periods in 1996. During 1995 for the same nine month and
three month periods, the margins were only 19% and 10% respectively.
Improvement was due to product selection, efficiencies, as well as attaining a
93% direct cost relationship to sales as compared to 78% for 1995. More
accurate direct costing results in the above benefits as well as allocating
appropriate amounts to all items in process.
Sales and general and administrative expenses decreased by approximately
$544,216 and approximately $40,261 for the nine month and three months ended
September 30, 1996 as compared to the comparable periods in 1995. This decrease
is due to labor reductions and expense controls.
Research and development expenses decreased by approximately $7,898 for the
nine month period and increased by approximately $15,102 for the three month
period ending September 30, 1996 as compared to the comparable periods in 1995.
9
<PAGE>
Liquidity and Capital Resources
For the period ending September 30, 1996 the Company had cash and cash
equivalents of approximately $60,834 representing an decrease of $253 from
December 31, 1995. This decrease is the result of the continued paydown of
debt, and cash used in excess of cash provided by operating activities and
Acculase being funded by Helionetics.
The Company failed to make timely payment of certain federal and state payroll
and withholding taxes during the period ended September 30, 1996. The Company
has entered into an agreement with the Internal Revenue Service for the period
through September 30, 1996 which requires certain scheduled payments to be made
of the arrears of the federal amounts and timely payment of current federal
amounts.
The Company continues to suffer from deficiencies in available capital
resources. This is expected to be resolved due to:
1) Factoring agreement of $400,000, (completed)
2) Warrants exercised of $703,500 (completed)
3) Warrants exercised, additional stock sales and/or loan repayments
totaling $1,500,000.
4) Subsequent sales increased due to cash in 1, 2, and 3 (above)
The Company will continue to have difficulty funding these current debt amounts
from its current cash flow. The Company's ability to finance its activities is
dependent on the Company increasing its production levels and/or obtaining
capital or a borrowing facility from external sources as listed above.
Funding for Acculase is the responsibility of the parent company, Helionetics,
Inc., through May, 1997.
10
<PAGE>
PART II. OTHER INFORMATION
Item 1 Legal Proceedings: See December 31, 1995 10-K
Item 2 Changes in Securities None
Item 3 Defaults Upon Senior Securities None
Item 4 Submission of Matters to Vote of
Security Holders None
Item 5 Other Information None
Item 6 Exhibits and Reports on Form 8-K
a) Exhibits None
b) Reports on Form 8-K None
11
<PAGE>
Signatures to Form 10-Q/B
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
LASER PHOTONICS, INC.
(Registrant)
Date: November 18, 1996 By: /s/ Steve Qualls
_____________________________________
Steve Qualls
Chief Executive Officer
Date: November 18, 1996 By: /s/ Robert Gibson
____________________________________
Robert Gibson
Controller
12
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 60,834
<SECURITIES> 0
<RECEIVABLES> 641,882
<ALLOWANCES> 0
<INVENTORY> 952,527
<CURRENT-ASSETS> 1,703,306
<PP&E> 801,661
<DEPRECIATION> 381,187
<TOTAL-ASSETS> 5,411,238
<CURRENT-LIABILITIES> 2,647,212
<BONDS> 0
0
0
<COMMON> 58,066
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 5,411,238
<SALES> 2,161,608
<TOTAL-REVENUES> 0
<CGS> 1,666,027
<TOTAL-COSTS> 1,666,027
<OTHER-EXPENSES> 1,892,553
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 305,802
<INCOME-PRETAX> (2,488,097)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,488,097)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
