<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM 10Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the quarterly period ended June 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 0-12488
---------
Isomedix Inc.
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 22-1986189
------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation of organization)
11 Apollo Drive, Whippany, New Jersey 07981
---------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(201) 887-4700
----------------------------------------------------
(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
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of June 30, 1996, 6,852,704 shares of common stock,
$.01 par value.
<PAGE> 2
ISOMEDIX INC. AND SUBSIDIARIES
TABLE OF CONTENTS
JUNE 30, 1996
Page
Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CONSOLIDATED BALANCE SHEETS 3-4
June 30, 1996 and
December 31, 1995
CONSOLIDATED STATEMENTS OF INCOME
For the Three Months Ended
June 30, 1996 and 1995 5
For the Six Months Ended
June 30, 1996 and 1995 6
CONSOLIDATED STATEMENT OF CHANGES
IN STOCKHOLDERS' EQUITY
For the Six Months Ended
June 30, 1996 7-8
CONSOLIDATED STATEMENTS OF CASH FLOWS 9
For the Six Months Ended
June 30, 1996 and 1995
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 10-12
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 13-19
PART II. OTHER INFORMATION 20-23
- 2 -
<PAGE> 3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ISOMEDIX INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1996 AND DECEMBER 31, 1995
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
------------ ------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents $ 4,203,308 $ 4,860,088
Held-to-Maturity Securities 17,304,883 17,003,329
Accounts Receivable, Less
Allowance for Doubtful Accounts
of $475,000 at June 30, 1996
and $350,000 at December 31, 1995 8,583,491 8,048,560
Prepaid Expenses and Other Current Assets 991,011 830,629
------------ ------------
Total Current Assets 31,082,693 30,742,606
------------ ------------
PROPERTY, PLANT AND EQUIPMENT
At Cost 68,378,868 66,751,900
Less, Accumulated Depreciation 19,203,009 17,855,870
------------ ------------
49,175,859 48,896,030
------------ ------------
RADIOISOTOPE
At Cost 68,470,904 66,096,338
Less, Accumulated Depreciation 38,757,083 36,624,237
------------ ------------
29,713,821 29,472,101
------------ ------------
EXCESS OF COSTS OVER NET ASSETS ACQUIRED 712,106 725,906
OTHER ASSETS 2,984,337 2,186,868
------------ ------------
Total Assets $113,668,816 $112,023,511
============ ============
</TABLE>
See accompanying notes to the consolidated financial statements.
- 3 -
<PAGE> 4
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
------------- -------------
LIABILITIES (Unaudited)
<S> <C> <C>
CURRENT LIABILITIES
Current Portion of Long-Term Debt $ 500,000 $ 500,000
Accounts Payable 816,041 766,914
Accrued Expenses 1,145,783 864,539
Contract Deposits 81,391 119,781
Income Taxes Payable 471,900 545,888
------------- -------------
Total Current Liabilities 3,015,115 2,797,122
LONG-TERM DEBT 8,500,000 8,600,000
DEFERRED INCOME TAXES 8,647,256 8,453,497
------------- -------------
Total Liabilities 20,162,371 19,850,619
------------- -------------
STOCKHOLDERS' EQUITY
PREFERRED STOCK
$1.00 par value
Authorized - 1,000,000 shares
Issued and Outstanding - none
COMMON STOCK
$.01 par value
Authorized - 15,000,000 shares
Issued:
June 30, 1996 - 7,169,868 shares
December 31, 1995 - 7,169,868 shares
Outstanding:
June 30, 1996 - 6,852,704 shares
December 31, 1995 - 6,984,528 shares 71,699 71,699
ADDITIONAL PAID-IN CAPITAL 37,683,481 37,719,155
RETAINED EARNINGS 60,426,865 57,167,649
------------- -------------
98,182,045 94,958,503
LESS, COMMON STOCK HELD IN THE TREASURY,
AT COST
June 30, 1996 - 317,164 shares
December 31, 1995 - 185,340 shares (4,675,600) (2,785,611)
------------- -------------
Total Stockholders' Equity 93,506,445 92,172,892
------------- -------------
Total Liabilities and
Stockholders' Equity $ 113,668,816 $ 112,023,511
============= =============
</TABLE>
See accompanying notes to the consolidated financial statements.
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<PAGE> 5
ISOMEDIX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
June 30, June 30,
1996 % 1995 %
------------ ----- ------------ -----
<S> <C> <C> <C> <C>
SALES $ 12,688,114 100.0 $ 11,479,351 100.0
COST OF SALES 6,231,186 49.1 5,461,840 47.6
------------ ----- ------------ -----
GROSS PROFIT 6,456,928 50.9 6,017,511 52.4
SELLING, GENERAL &
ADMINISTRATIVE EXPENSES 3,605,003 28.4 2,870,241 25.0
------------ ----- ------------ -----
OPERATING INCOME 2,851,925 22.5 3,147,270 27.4
OTHER INCOME (EXPENSE)
Investment Income 222,727 1.7 303,320 2.6
Interest Expense (116,808) (.9) (137,655) (1.2)
------------ ----- ------------ -----
INCOME BEFORE PROVISION
FOR INCOME TAXES 2,957,844 23.3 3,312,935 28.8
PROVISION FOR INCOME
TAXES 1,183,129 9.3 1,325,174 11.5
------------ ----- ------------ -----
NET INCOME $ 1,774,715 14.0 $ 1,987,761 17.3
============ ===== ============ =====
EARNINGS PER SHARE $ .25 $ .28
============ ============
</TABLE>
See accompanying notes to the consolidated financial statements.
- 5 -
<PAGE> 6
ISOMEDIX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
June 30, June 30,
1996 % 1995 %
------------ ----- ------------ -----
<S> <C> <C> <C> <C>
SALES $ 24,257,648 100.0 $ 22,934,377 100.0
COST OF SALES 12,326,996 50.8 10,997,518 48.0
------------ ----- ------------ -----
GROSS PROFIT 11,930,652 49.2 11,936,859 52.0
SELLING, GENERAL &
ADMINISTRATIVE EXPENSES 6,677,323 27.5 5,715,209 24.9
------------ ----- ------------ -----
OPERATING INCOME 5,253,329 21.7 6,221,650 27.1
OTHER INCOME (EXPENSE)
Investment Income 414,637 1.7 471,196 2.1
Interest Expense (235,954) (1.0) (272,907) (1.2)
------------ ----- ------------ -----
INCOME BEFORE PROVISION
FOR INCOME TAXES 5,432,012 22.4 6,419,939 28.0
PROVISION FOR INCOME
TAXES 2,172,796 9.0 2,567,976 11.2
------------ ----- ------------ -----
NET INCOME $ 3,259,216 13.4 $ 3,851,963 16.8
============ ===== ============ =====
EARNINGS PER SHARE $ .45 $ .53
============ ============
</TABLE>
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<PAGE> 7
ISOMEDIX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
TOTAL
STOCKHOLDERS'
EQUITY
-------------
<S> <C>
BALANCE - December 31, 1995 $ 92,172,892
Exercise of Stock Options 155,920
Acquisition of Treasury Stock (2,145,003)
Sales of Common Stock Under Employee
Stock Purchase Plan 63,420
Net Income 3,259,216
------------
BALANCE - June 30, 1996 $ 93,506,445
============
</TABLE>
See accompanying notes to the consolidated financial statements.
- 7 -
<PAGE> 8
<TABLE>
<CAPTION>
COMMON STOCK TREASURY STOCK
--------------------- ADDITIONAL ------------------------
NUMBER PAID-IN RETAINED NUMBER
OF SHARES AMOUNT CAPITAL EARNINGS OF SHARES AMOUNT
<S> <C> <C> <C> <C> <C> <C>
BALANCE - December 31, 1995 7,169,868 $71,699 $37,719,155 $57,167,649 (185,340) ($2,785,611)
Exercise of Stock Options (35,674) 12,700 191,594
Acquisition of Treasury Stock (150,000) (2,145,003)
Sales of Common Stock Under Employee
Stock Purchase Plan 5,476 63,420
Net Income 3,259,216
--------- ------- ----------- ----------- -------- -----------
BALANCE - June 30, 1996 7,169,868 $71,699 $37,683,481 $60,426,865 (317,164) ($4,675,600)
========= ======= =========== =========== ======== ===========
</TABLE>
See accompanying notes to the consolidated financial statements.
- 8 -
<PAGE> 9
ISOMEDIX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
June 30, June 30,
1996 1995
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net Income $ 3,259,216 $ 3,851,963
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 3,479,985 3,434,790
Amortization 112,927 342,700
Increase in allowance for doubtful accounts 125,000
Changes in assets and liabilities:
(Increase) decrease in accounts receivable (659,931) 406,927
(Increase) decrease in prepaid expenses and
other assets (137,314) 602,195
Increase (decrease)in accounts payable and
accrued expenses 330,371 (941,569)
(Decrease) increase in contract deposits (38,390) 36,114
(Decrease) increase in income taxes payable (73,988) 30,833
Increase in deferred income taxes 193,759 169,975
------------ ------------
Net cash provided by operating activities 6,591,635 7,933,928
------------ ------------
Cash flows from investing activities:
Purchases of held to maturity securities (31,748,331) (9,410,034)
Proceeds from maturity of held to
maturity securities 31,446,777 5,685,932
Increase in equipment deposits (900,000)
Additions to property, plant and
equipment (1,626,968) (3,215,894)
Additions to radioisotope (2,374,566) (863,134)
Other (19,664) (32,745)
------------ ------------
Net cash used in investing activities (5,222,752) (7,835,875)
------------ ------------
Cash flows from financing activities:
Payment of long-term debt (100,000) (425,000)
Purchases of treasury stock (2,145,003) (1,275,944)
Other (93,099)
Proceeds of stock options exercised and
employee stock purchases 219,340 287,728
------------ ------------
Net cash used in financing activities (2,025,663) (1,506,315)
------------ ------------
Net decrease in cash and cash equivalents (656,780) (1,408,262)
Cash and cash equivalents at beginning of period 4,860,088 5,961,473
------------ ------------
Cash and cash equivalents at end of period $ 4,203,308 $ 4,553,211
------------ ------------
Supplemental cash flow information:
Cash paid for interest (net of amounts
capitalized) $ 179,914 $ 272,907
------------ ------------
Cash paid for income taxes $ 499,702 $ 1,856,339
------------ ------------
Supplemental non-cash investing activities
Additions to radioisotope in satisfaction
of lease receivable $ 180,440
------------
</TABLE>
See accompanying notes to the consolidated financial statements.
- 9 -
<PAGE> 10
ISOMEDIX INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The interim consolidated financial statements reflect all adjustments,
consisting only of normal recurring accruals, which are, in the opinion of the
Company's management, necessary for a fair statement of results for the periods
presented. Operating revenues and net income for any interim period are not
necessarily indicative of results for a full year.
2. Earnings per share have been computed based upon the weighted average number
of shares of common stock outstanding during each period. For the three months
ended June 30, 1996 and 1995, the numbers of shares used in computing earnings
per share were 7,172,600 and 7,189,192, respectively. For the six months ended
June 30, 1996 and 1995, the numbers of shares used in computing earnings per
share were 7,182,112 and 7,227,558, respectively.
3. As of June 30, 1996, debt securities had a carrying value of $17,304,883 and
a market value of $17,362,859. The market value is calculated using information
provided by outside quotation services. The Company's investments consist of
debt instruments from federal, and various state and municipal issuers with
maturity dates not exceeding one year.
Gross unrealized losses were $2,574 at June 30, 1996, compared to $237,326 at
June 30, 1995.
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<PAGE> 11
4. The Company has reclassified certain prior period amounts to conform with the
1996 presentation.
5. In April, 1996, the Company made a decision to establish two fully
operational validation service offices in New Jersey and Southern California. As
part of this process, the headquarters of Skyland will be relocated from
Bozeman, Montana to the vicinity of the Company's corporate office. Each
regional operation will be in proximity to pharmaceutical industry concentration
and will have the full complement of personnel and test equipment to conduct
full scale validation projects. The benefits derived from this decision are
greater access to Skyland's resources, reduction of travel costs of personnel
and greater flexibility in the scheduling and performance of validation
projects. Throughout the remainder of 1996, the Company will incur approximately
an additional $250,000 of expenses, on a pre-tax basis, relating to the above.
The foregoing paragraph contains forward looking information concerning the
Company's expected future expenditures for fiscal 1996 in connection with the
establishment of two new validation service offices and relocation of the
headquarters of the Company's Skyland subsidiary. The forward looking statements
are necessarily estimates and reflect the Company's best judgment based upon
current information. Factors which could cause actual expenditures to differ
from those estimated by the Company include an unanticipated delay in
implementing the establishment of the offices and the headquarters relocation.
- 11 -
<PAGE> 12
6. In 1996 the Company adopted Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation." ("SFAS 123"). SFAS 123
establishes a fair value method for accounting for stock-based compensation
plans either through recognition or disclosure. SFAS 123 is effective for
financial statements for fiscal years beginning after December 15, 1995. The
Company plans to comply with the proforma disclosure method provisions of SFAS
123 and will disclose in its financial statements for the full year 1996 the
proforma net income and earnings per share amounts assuming the fair value
method was effective on January 1, 1995. SFAS 123 is effective for the fiscal
year ending December 31, 1996. The adoption of SFAS 123 will not impact the
Company's consolidated results of operations, financial position or cash flows.
- 12 -
<PAGE> 13
ITEM 2:
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 1996 AND 1995
Consolidated sales increased approximately 10.5% to $12,688,114 in 1996 from
$11,479,351 in 1995. This increase resulted from a 7.9% increase in sales of
sterilization services to $11,562,127 in 1996 from $10,713,606 in 1995, due to
the higher volumes of product processed for new and existing customers. This
increase was partially offset by increased competitive factors including pricing
pressures which are expected to continue during 1996. These pricing pressures
are resulting in lower margin business for the Company, offset in part by higher
volumes. Sales of validation services by the Company's Skyland subsidiary
increased 47.0% to $1,125,987 in 1996 from $765,745 in 1995, due to additional
contracts with new and existing customers.
Gross profit decreased to 50.9% of sales in 1996 from 52.4% in 1995. This
decrease is attributable to increased competitive factors including pricing
pressures, as described above. This decrease was partially offset by the growth
in consolidated sales.
Selling, general and administrative expenses, as a percentage of sales, were
28.4% in 1996 compared to 25.0% in 1995. This increase was primarily due to a
one-time charge of $350,000 ($210,000 after tax) in connection with the
relocation of the
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<PAGE> 14
headquarters of the Company's Skyland subsidiary to the vicinity of the
Company's corporate office and the establishment of a West Coast regional center
of operations. Selling, general and administrative expense was also impacted by
increased payroll and payroll related costs resulting from the additions to the
corporate management staff.
Consolidated operating income increased 1.7% to $3,201,825 in 1996 from
$3,147,270 in 1995, and as a percentage of sales, to 25.2% in 1996 compared to
27.4% in 1995, before a one-time charge in 1996 of $350,000 on a pretax basis in
connection with the relocation of the headquarters of the Company's Skyland
subsidiary to the vicinity of the Company's corporate office and the
establishment of a West Coast regional center of operations. After taking into
account the one-time charge, operating income decreased 9.4% to $2,851,925 in
1996 from $3,147,270 in 1995, and as a percentage of sales to 22.5% in 1996
compared to 27.4% in 1995. Operating income from sterilization services (before
corporate overhead) decreased to 34.8% of that segment's sales in 1996 from
36.8% in 1995. These decreases resulted from the factors described above.
Operating income from validation services (before corporate overhead) decreased
to a loss of $199,412 in 1996 from income of $7,905 in 1995, primarily as a
result of the one-time charge of $350,000 ($210,000 after tax) in connection
with the relocation of the headquarters of Skyland and the establishment of a
West Coast regional center of operations, as partially offset by the increase in
sales.
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<PAGE> 15
Investment income decreased to $222,727 in 1996 from $303,320 in 1995, primarily
as a result of a decrease in invested capital, compared to a year ago, due to
the purchase of Company common stock, radioisotope and property, plant and
equipment, as partially offset by higher effective yields received on invested
securities.
Interest expense decreased to $116,808 in 1996 from $137,655 in 1995 as a result
of the payments of current maturities on long-term debt.
Net income decreased to $1,774,715 in 1996 from $1,987,761 in 1995. This
decrease in net income was attributable to the reasons described above. As a
percentage of sales, net income was 14.0% in 1996 compared to 17.3% in 1995.
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<PAGE> 16
RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND 1995
Consolidated sales increased approximately 5.8% to $24,257,648 in 1996 from
$22,934,377 in 1995. This increase resulted from a 5.8% increase in sales of
sterilization services to $22,354,859 in 1996 from $21,128,699 in 1995, due to
higher volumes of products processed for new and existing customers and the
recognition of progress billing toward an irradiator sold to the United States
Department of Agriculture for insect sterilization. This increase was partially
offset by increased competitive factors including pricing pressures which are
expected to continue during 1996. These pricing pressures are resulting in lower
margin business for the Company, offset in part by higher volumes. Sales of
validation services by the Company's Skyland subsidiary increased 5.4% to
$1,902,789 in 1996 from $1,805,678 in 1995, due to additional contracts for new
and existing customers.
Gross profit decreased to 49.2% of sales in 1996 from 52.0% in 1995. This
decrease is attributable to increased competitive factors including pricing
pressures, as described above. This decrease was partially offset by the growth
in consolidated sales.
Selling, general and administrative expenses, as a percentage of sales, were
27.5% in 1996 compared to 24.9% in 1995. This
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<PAGE> 17
increase was primarily due to a one-time charge of $350,000 ($210,000 after tax)
in connection with the relocation of the headquarters of the Company's Skyland
subsidiary to the vicinity of the Company's Corporate office and the
establishment of a West Coast regional center of operations. Selling, general
and administrative expense was also impacted by increased payroll and payroll
related costs resulting from the additions to the corporate management staff.
Consolidated operating income decreased 15.6% to $5,253,329 in 1996 from
$6,221,650 in 1995, and as a percentage of sales, to 21.7% in 1996 compared to
27.1% in 1995. Operating income from sterilization services (before corporate
overhead) decreased to 32.9% of that segment's sales in 1996 from 35.5% in 1995.
These decreases resulted from the factors described above. Operating income from
validation services (before corporate overhead) decreased to a loss of $225,253
in 1996 from income of $144,300 in 1995, primarily as a result of the one-time
charge, in 1996, of $350,000 ($210,000 after tax) in connection with the
relocation of the headquarters of Skyland and the establishment of a West Coast
regional center of operations.
Investment income decreased to $414,637 in 1996 from $471,196 in 1995, primarily
as a result of a decrease in invested capital, compared to a year ago, due to
the purchase of Company common stock, and radioisotope and property, plant and
equipment, as partially offset by higher effective yields received on invested
securities.
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<PAGE> 18
Interest expense decreased to $235,954 in 1996 from $272,907 in 1995 as a result
of the payments of current maturities on long-term debt.
Net income decreased to $3,259,216 in 1996 from $3,851,963 in 1995. This
decrease in net income was attributable to the reasons described above. As a
percentage of sales, net income was 13.4% in 1996 compared to 16.8% in 1995.
LIQUIDITY AND CAPITAL RESOURCES
The increase in the Company's liquidity was principally attributable to the cash
provided by operating activities, derived from net income for the period as
adjusted for non-cash expense items such as depreciation and amortization. This
increase was partially offset by cash used to fund capital expenditures for the
purchase of equipment and radioisotope for the Company's existing sterilization
facilities, the construction of a new sterilization facility in Libertyville,
Illinois, and the purchase of Company common stock.
The Company has utilized industrial development revenue bonds and sales of
common stock to finance a substantial portion of the costs of constructing and
equipping (including the purchase of radioisotope) some of its sterilization
facilities. The obligations of the Company under the terms of the industrial
development revenue bonds are collateralized by the property, plant, equipment
and radioisotope purchased with the proceeds of
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<PAGE> 19
such bonds and the agreements relating to such bonds contain various restrictive
covenants. More recently, funds generated from operations have served as a
source of funds used to finance the construction and equipping of facilities.
The Company believes that funds from operating activities will be sufficient to
purchase radioisotope and to equip, on a year to year basis, the Company's
existing sterilization facilities. The Company may utilize existing credit
facilities, which the Company expects to be able to renew annually, to fund the
working capital needs of the Company, as required. Expansion plans are expected
to be funded from the Company's investments, which will mature in amounts
necessary to cover the foreseeable expansion program of the Company. The
Company's capital expenditures for 1996 are anticipated to be approximately $13
million, including the continuing construction and equipping of the Company's
new sterilization facility in Libertyville, Illinois, which is expected to
become operational in the latter part of 1996.
INFLATION
Inflation is not expected to have a significant impact on the Company's income,
particularly as the United States economy is presently experiencing a period of
low inflation. Based upon its experience since inception, the Company does not
expect that future increases in the cost of radioisotope, ethylene oxide gas or
other materials will be significant to its operations.
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<PAGE> 20
PART II. OTHER INFORMATION
Item 1 Legal Proceedings
None to Report.
Item 2 Changes in Securities
None to report.
Item 3 Defaults Upon Senior Securities
None to report.
Item 4 Submissions of Matters to a Vote of Security Holders
a) Registrant held its Annual Meeting of Stockholders on May
17, 1996.
Holders of at least 5,864,757 shares of the Common Stock of
the Company were present in person or represented by proxy,
being approximately 83.82% of the 6,996,213 shares of Common
Stock of the Company outstanding at the close of business on
March 25, 1996, the Record Date of the Meeting.
The following matters were acted on by the stockholders at the
Meeting:
1) The following persons were elected to the Board of
Directors, as follows:
<TABLE>
<CAPTION>
Votes Votes Votes
For Against Abstaining
<S> <C> <C> <C>
Thomas J. DeAngelo 5,829,307 35,450
Thomas M. Haythe 5,828,407 36,350
</TABLE>
The following persons continue as directors after the
Meeting: H. Stuart Campbell, Elmer A. Sticco, David M. Lank,
John Masefield and Peter Mayer.
2) A proposal for the adoption of the Isomedix Inc. 1996 Long
Term Incentive Plan was approved, as follows: 3,078,004
shares voted in favor 838,993 shares voted against and
19,865 shares abstained.
3) A proposal for the ratification of the selection of Coopers
& Lybrand L.L.P. to serve as the auditors for the fiscal
year ending December 31, 1996 was approved, as follows:
5,819,167 shares voted in favor, 33,000 shares voted against
and 12,590 shares abstained.
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<PAGE> 21
PART II. OTHER INFORMATION
Item 5 Other Information
None to report.
Item 6 Exhibits and Reports on Form 10-Q
(a) Exhibits:
XI(a) Statement Re: Computation of Earnings Per Share For
the Three Months Ended June 30, 1996 and 1995.
(Unaudited)
XI(b) Statement Re: Computation of Earnings Per Share for
the Six Months Ended June 30, 1996 and 1995.
(Unaudited)
27 Financial Data Schedule
(b) Reports on Form 8-K:
During the three months ended June 30, 1996, the registrant
filed no reports on Form 8-K.
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<PAGE> 22
EXHIBIT XI (a)
ISOMEDIX INC. AND SUBSIDIARIES
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE FOR THE
THREE MONTHS ENDED JUNE 30, 1996 AND 1995.
(Unaudited)
Net income and common shares used in the calculation of earnings per share for
the three months ended June 30, 1996 and 1995, were computed as follows:
<TABLE>
<CAPTION>
June 30, June 30,
1996 1995
---------- ----------
<S> <C> <C>
Net Income $1,774,715 $1,987,761
========== ==========
Weighted average number
of common shares
outstanding during the
period: 6,969,955 6,980,305
Add: Shares issuable upon
assumed exercise or con-
version of stock options
and warrants 202,645 208,887
---------- ----------
Common Shares 7,172,600 7,189,192
========== ==========
Earnings per common share $ .25 $ .28
========== ==========
</TABLE>
- 22 -
<PAGE> 23
EXHIBIT XI (b)
ISOMEDIX INC. AND SUBSIDIARIES
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE FOR THE
SIX MONTHS ENDED JUNE 30, 1996 AND 1995.
(Unaudited)
Net income and common shares used in the calculation of earnings per share for
the six months ended June 30, 1996 and 1995, were computed as follows:
<TABLE>
<CAPTION>
June 30, June 30,
1996 1995
---------- ----------
<S> <C> <C>
Net Income $3,259,216 $3,851,963
========== ==========
Weighted average number
of common shares
outstanding during the
period: 6,981,350 7,005,528
Add: Shares issuable upon
assumed exercise or con-
version of stock options
and warrants 200,762 222,030
---------- ----------
Common Shares 7,182,112 7,227,558
========== ==========
Earnings per common share $ .45 $ .53
========== ==========
</TABLE>
- 23 -
<PAGE> 24
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.
ISOMEDIX INC.
(Registrant)
Date: August 9, 1996 /s/ Peter Mayer
---------------------------
Peter Mayer
President and
Chief Executive Officer
Date: August 9, 1996 /s/ Thomas J. DeAngelo
---------------------------
Thomas J. DeAngelo
Vice President
Finance and Administration
and Chief Financial Officer
- 24 -
<PAGE> 25
EXHIBIT INDEX
-------------
Exhibit 27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<EXCHANGE-RATE> 1
<CASH> 4,203,308
<SECURITIES> 17,304,883
<RECEIVABLES> 9,058,491
<ALLOWANCES> 475,000
<INVENTORY> 0
<CURRENT-ASSETS> 31,082,693
<PP&E> 136,849,772
<DEPRECIATION> 57,960,092
<TOTAL-ASSETS> 113,668,816
<CURRENT-LIABILITIES> 3,015,115
<BONDS> 8,500,000
0
0
<COMMON> 71,699
<OTHER-SE> 93,434,746
<TOTAL-LIABILITY-AND-EQUITY> 113,668,816
<SALES> 24,257,648
<TOTAL-REVENUES> 24,257,648
<CGS> 12,326,996
<TOTAL-COSTS> 12,326,996
<OTHER-EXPENSES> 6,677,323
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 235,954
<INCOME-PRETAX> 5,432,012
<INCOME-TAX> 2,172,796
<INCOME-CONTINUING> 3,259,216
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,259,216
<EPS-PRIMARY> 0.45
<EPS-DILUTED> 0.45
</TABLE>
