UNITED STATES
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 March 31, 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: 0-11914
-------
Advanced NMR Systems, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 22-2457487
------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
46 Jonspin Road, Wilmington, Massachusetts 01887
-----------------------------------------------------
(Address or principal executive offices) (Zip Code)
(508) 657-8876
----------------------------------------------------
(Registrant's telephone number, including area code)
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
-------
As of April 30, 1996, there were 30,259,308 shares of Common Stock, $.01
par value, outstanding.
<PAGE>
ADVANCED NMR SYSTEMS, INC. AND SUBSIDIARIES
-------------------------------------------
INDEX
-----
PART I. FINANCIAL INFORMATION Page No.
--------------------- --------
Item 1. Financial Statements
Consolidated Balance Sheets:
March 31, 1996 and September 30, 1995 1
Consolidated Statements of Operations:
Quarters and Six Months Ended March 31, 1996
and March 31, 1995 2
Consolidated Statement of Stockholders' Equity 3
Consolidated Statements of Cash Flows:
Six Months Ended March 31, 1996
and March 31, 1995 4
Notes to Consolidated Financial Statements 5 - 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8 - 9
PART II. OTHER INFORMATION
-----------------
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 11
<PAGE>
FORM 10-Q
Part I. FINANCIAL INFORMATION
ITEM 1. - Financial Statements
ADVANCED NMR SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
March 31, September 30,
ASSETS 1996 1995
------ ---- ----
Current assets:
Cash and cash equivalents $3,342,997 $7,542,508
Accounts receivable, net of
reserve for bad debts of
$2,358,000 at March 31, 1996
and $2,103,000 at September
30, 1995 10,296,910 9,741,892
Inventories 5,291,909 3,312,591
Other current assets 1,769,836 1,972,871
----------- -----------
Total current assets 20,701,652 22,569,862
----------- -----------
Equipment, building,
furniture and leasehold
improvements, net 9,291,123 8,207,687
Patent costs, net 204,350 205,754
Goodwill, net 26,452,580 26,858,226
Other 654,566 590,180
----------- -----------
TOTAL $57,304,271 $58,431,709
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable $3,527,394 $1,001,130
Accrued expenses 2,054,036 3,024,216
Due to shareholders 46,102 1,696,102
Customer deposits 924,071 --
Accrued compensation 864,290 1,331,188
Other current liabilities 117,792 159,971
Current portion of long-term
debt and capital
lease obligations 4,803,899 4,274,110
----------- -----------
Total current liabilities 12,337,584 11,486,717
----------- -----------
Long-term debt and capital
lease obligations,
less current portion 17,074,151 16,279,352
Deferred revenues, net of current -- 33,567
Minority interest in net
assets of consolidated
entities 2,063,593 2,614,107
Stockholders' equity:
Preferred stock, $.01 par value;
authorized, 1,000,000 shares;
issued, none -- --
Common stock, $.01 par value;
authorized, 50,000,000 shares;
issued 30,259,308 at March 31,
1996 and 30,151,821 shares
at September 30, 1995 302,593 301,518
Additional paid-in capital 58,376,281 58,246,689
Accumulated deficit (32,847,681) (30,527,991)
------------ ------------
25,831,193 28,020,216
Less: treasury stock, at cost -
225,000 common shares 2,250 2,250
---------- ----------
Total stockholders' equity 25,828,943 28,017,966
---------- ----------
TOTAL $57,304,271 $58,431,709
========== ==========
The accompanying notes to financial statements are an integral part hereof.
<PAGE>
FORM 10-Q
ADVANCED NMR SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
March 31, March 31,
-------- --------
1996 1995 1996 1995
---- ---- ---- ----
Revenues:
System sales $2,219,406 $1,920,589 $ 2,268,604 $1,983,979
Net patient
service revenue 6,266,083 -- 12,279,493 --
Management fees
and other 243,663 -- 385,631 --
---------- ---------- ----------- ----------
Total revenues 8,729,152 1,920,589 14,933,728 1,983,979
---------- ---------- ----------- ----------
Operating expenses:
Cost of goods sold 1,366,895 1,039,785 1,382,687 1,231,729
Cost of service
operations 3,974,914 -- 7,754,628 --
Research and
development 693,042 761,494 1,343,356 1,528,712
Selling, general
and administrative 2,680,925 818,918 5,120,355 2,326,294
Provision for bad
debt and collection
costs 499,375 -- 973,364 --
-------- --------- ---------- ----------
Total operating
expenses 9,215,151 2,620,197 16,574,390 5,086,735
--------- ---------- ----------- ----------
Loss from operations (485,999) (699,608) (1,640,662) (3,102,756)
Other income 126,263 392,250 126,263 392,250
Interest income 50,392 122,154 142,539 110,138
Interest expense (498,723) ( 3,941) (989,503) ( 8,153)
--------- ---------- ----------- ---------
Loss before minority
interests and
provision for
income taxes (808,067) (189,145) (2,361,363) (2,608,521)
Minority interests
in net loss of
consolidated
entities 76,042 190,820 59,656 404,986
--------- ---------- ---------- ----------
Net income (loss)
before provision
for income taxes (732,025) 1,675 (2,301,707) (2,203,535)
Provision for
income taxes (17,983) -- (17,983) --
--------- ---------- ---------- ----------
Net income (loss) $(750,008) $1,675 $(2,319,690) $(2,203,535)
======== ========== =========== ===========
Net income (loss)
per share $(.02) $.00 $(.08) $(.09)
=== === === ===
Weighted average
number of shares
outstanding 30,207,173 23,716,636 30,186,913 23,716,650
========== ========== ========== ==========
The accompanying notes to financial statements are an integral part hereof.
<PAGE>
FORM 10-Q
ADVANCED NMR SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)
Common Stock
------------------ Paid-in Accumulated
shares Amount Capital Deficit
------ ------ ------- -------
Balance - September 30,
1995 30,151,821 $301,518 $58,246,689 $(30,527,991)
Exercise of stock
options 107,487 1,075 129,592 --
Net loss for period -- -- -- (2,319,690)
---------- -------- ----------- ------------
Balance - March 31,
1996 30,259,308 $302,593 $58,376,281 $(32,847,681)
========== ======== =========== ============
Treasury Stock
--------------------
Shares Amount Total
------ ------ -----
Balance - September 30,
1995 225,000 $(2,250) $28,017,966
Exercise of stock options -- -- 130,667
Net loss for period -- -- (2,319,690)
------- ------- -----------
Balance - March 31, 1996 225,000 $(2,250) $25,828,943
======= ======= ===========
The accompanying notes to financial statements are an integral part hereof.
<PAGE>
FORM 10-Q
ADVANCED NMR SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
March 31,
----------
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(2,319,690) $(2,203,535)
Adjustments to reconcile net
loss to net cash used in
operating activities:
Minority interest in net
loss of consolidated entities (59,656) (404,986)
Depreciation and amortization 1,673,937 268,306
Common stock and warrant issued
for services -- 35,000
Changes in assets and liabilities:
Accounts receivable, net (678,678) (605,530)
Inventories (1,979,318) (1,449,929)
Other current assets 216,771 (135,674)
Accounts payable and accrued
expenses 2,004,653 1,663,213
--------- ---------
Net cash used in operating activities (1,141,981) (2,833,135)
----------- -----------
Cash flows from investing activities:
Purchase of imaging and
rehabilitation business (1,650,000) --
Patent costs (30,802) (84,535)
Purchase of equipment, furniture
and leaseholds improvements (357,993) (88,270)
Other assets (45,116) 14,875
----------- ---------
Net cash used in investing activities (2,083,911) (157,930)
----------- ---------
Cash flows from financing activities:
Exercise of stock options 130,667 83
Proceeds from issuance of long-
term debt 680,000 --
Cancellation of stock and options -- (392,250)
Proceeds from repayment of note
receivable -- 110,000
Repayment of long-term debt and
capital lease obligations (1,226,286) (54,727)
Distributions to minority interests (558,000) --
Sale of warrant rights -- 200
Sale of subsidiary stock -- 2,557,509
----------- ---------
Net cash provided (used) in
financing activities (973,619) 2,220,815
----------- ---------
NET DECREASE IN CASH AND CASH
EQUIVALENTS (4,199,511) (770,250)
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 7,542,508 6,907,841
----------- ---------
CASH AND CASH EQUIVALENTS,
END OF PERIOD $3,342,997 $6,137,591
=========== =========
Supplemental Disclosures of Cash
Flow Information:
Interest paid during the period $1,044,406 $8,153
=========== =====
Supplemental Schedule of Non-cash
Investing and Financing Activities:
Additions to capital leases $1,870,874 $ --
=========== =========
The accompanying notes to financial statements are an integral part hereof.
<PAGE>
FORM 10-Q
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
------------------------------------------------------
Note 1 - Basis of Presentation
------------------------------
The results of operations for the interim periods shown in this
report are not necessarily indicative of results to be expected for
the fiscal year. In the opinion of management, the information
contained herein reflects all adjustments necessary to make the
results of operations for the interim periods a fair statement of
such operations. All such adjustments are of a normal recurring
nature.
The accompanying financial statements do not contain all of the
disclosures required by generally accepted accounting principles and
should be read in conjunction with the financial statements and
related notes included in the Company's annual report on Form 10-K
for the nine month period ended September 30, 1995.
Note 2 - The Company
--------------------
Advanced NMR Systems, Inc. ("ANMR" or the "Company") operates
its business under two segments consisting of Imaging Systems and
Imaging and Rehabilitation Services.
Imaging Systems
---------------
ANMR was founded in 1983 to develop echo planar imaging ("EPI"),
an ultrafast MRI technology. From its inception through November
1992, the Company engaged exclusively in research and development
activities. In 1992, ANMR received U.S. Food and Drug Administration
("FDA") clearance for its InstaScan system and commenced commercial
marketing activities to clinical institutions. InstaScan technology
is currently incorporated in several systems, including the 3T/4T
very high field MRI systems where the Company is the exclusive
systems integrator for General Electric Medical Systems, and a
neurological product.
In 1992, the Company formed Advanced Mammography Systems, Inc.
("AMS") as a subsidiary for the purpose of financing the development
of the MR Breast Imaging system. In early 1993, AMS completed its
initial public offering. ANMR has an approximately 61% ownership
interest in AMS, a publicly-traded company, which has developed a
dedicated MR Breast Imaging system and has received FDA clearance for
commercial use. AMS is traded on the NASDAQ stock market under the
ticker symbol MAMO.
Imaging and Rehabilitation Services
-----------------------------------
The Imaging and Rehabilitation Services segment consists of
Medical Diagnostics, Inc. ("MDI"), which the Company acquired on
August 31, 1995 as the initial phase of the Company's strategy to
penetrate and expand its business into MRI and rehabilitation
services. MDI is an operator and manager of a network of mobile and
fixed MRI units in Massachusetts, New York, Virginia, West Virginia
and Tennessee. MDI also provides Single Photon Emission Computer
Tomography ("SPECT") nuclear medicine imaging services, Computerized
Axial Tomography ("CT") medical imaging services and physical therapy
services. MDI operates much of its business through various
partnerships and joint ventures in which MDI or a wholly-owned
subsidiary of MDI serves as a general partner.
Note 3 - The GEMS Agreement
---------------------------
In July 1994, the Company concluded an agreement with General
Electric Medical Systems ("GEMS") for the sale of 3T and 4T research
MR systems to GEMS which currently runs through June 1999. These
systems, which have not yet been submitted to the FDA for clearance
for commercial use, are being sold to research institutions
throughout the world. To date, very high field systems have been
installed at University of Florida at Gainesville, the University of
California at Los Angeles and Niigata University in Niigata Japan.
Another system is expected to be shipped to a university in Japan
during the third quarter of fiscal 1996. In addition, a 3T system
installed at the University of Pittsburgh and a 4T system at the
National Institutes of Health were upgraded with the Company's
InstaScan product.
The Company had marketed InstaScan through joint marketing
agreements with GEMS. The 1993 Agreement had provided for GEMS to
purchase 100 InstaScan units over a two year period which ended on
December 31, 1994. If GEMS did not achieve the minimum purchases
under the contract, it was to have paid certain amounts as a penalty.
In July 1994, the 1993 Agreement was modified to commit revenues
realized from the sale of 3T and 4T systems through December 31, 1995
towards GEMS' obligation under the 1993 Agreement. As of January 31,
1996, GEMS has purchased seventeen InstaScan systems and three 3T/4T
systems and an additional unit is expected to be delivered to a site
in Japan during the third quarter of fiscal 1996. As of April 30,
1996, GEMS had not satisfied its minimum obligations under the
InstaScan contract. The minimum purchase obligation is subject to
usual conditions of sale, including changes in health care regulation
covering MRI products. In January 1996, the Company reached an
agreement with GEMS to extend the contract between the companies
whereby the Company is the exclusive system integrator for 3T and 4T
MR imaging systems through June 1999 and extended the period for the
payment of the minimum purchase obligation.
Note 4 - AMS (Subsidiary) Escrow Shares
---------------------------------------
In July 1992, the Company licensed (the "ANMR License
Agreement") to AMS to use the Company's technology in the development
of a dedicated MR Breast Imaging system. As consideration for the
ANMR License Agreement, AMS paid to the Company $1,680,000 and issued
4,000,000 shares of its common stock, of which 2,750,000 shares are
subject to an escrow agreement for release based upon AMS achieving
certain levels of pretax income or share price in the future as
follows: (a) 916,667 escrow shares are released if AMS's minimum
pretax income is at least $3.0 million during fiscal year 1995 and
(b) the remaining 1,833,333 escrow shares are released or, if none of
the escrow shares have been released under (a), then all 2,750,000 of
the escrow shares are released, if (i) AMS's minimum pretax income is
at least $5.0 million during fiscal year 1995; or (ii) AMS's minimum
pretax income is at least $8.0 million during fiscal year 1996; or
(iii) beginning 19 months from January 25, 1993 and ending 36 months
from the same date, the bid price for AMS's Common Stock averages in
excess of $20.00 per share for 30 consecutive days. The Company
expects the escrow shares will be forfeited and contributed to the
capital of AMS on May 1, 1997. If the shares are released from
escrow, AMS will incur an expense based on the fair market value of
AMS Common Stock at the time they are released. For consolidation
purposes, the Company treats the escrow shares as if they were
outstanding.
Note 5 - MDI Merger and Related Pro Forma Financial Information
---------------------------------------------------------------
Effective August 31, 1995, Medical Diagnostics, Inc. ("MDI")
merged (the "Merger") with a wholly-owned subsidiary of the Company.
In connection with the Merger, MDI entered into a loan and security
agreement with a bank to finance the cash portion of the merger. The
acquisition has been accounted for under the purchase method of
accounting and the purchase price of $29,806,000, exclusive of
related costs, consisted of cash of approximately $11,196,000 and
stock valued at approximately $18,610,000. In addition,
approximately 2,332,000 warrants to purchase ANMR stock at $3.75 per
share were issued to MDI shareholders and the Company granted
1,218,000 options and 426,000 warrants upon assumption of oustanding
MDI stock options. The purchase price and costs associated with the
acquisition exceeded the fair value of the net assets acquired by
approximately $26,978,000 which has been assigned to goodwill and is
being amortized on a straight-line basis over thirty years.
The following unaudited pro forma financial information combines
the results of the Company and the acquired entity as if the
acquisition had occurred on October 1, 1994, after giving effect to
amortization of goodwill and deferred financing fees, increased
interest expense on the borrowings, reversal of direct acquisition
costs, reversal of tax benefit recorded and decreases in interest
income. The pro forma financial information does not purport to be
indicative of what would have occurred had the acquisition been made
as of October 1, 1994 or results that may occur in the future.
Six months ended
March 31,1995
-------------
Net revenues $13,565,000
Net loss $(3,319,000)
Loss per share $(.11)
Note 6 - Private Placement Subsidiary Convertible Debentures,
-------------------------------------------------------------
Termination of Plan of Merger and Nasdaq Trading Status
-------------------------------------------------------
As of May 15, 1996, AMS closed a private placement (the
"Placement") of $3 million principal 4% Convertible Debentures. Net
proceeds from the Placement was approximately $2,750,000, after
payment of fees and related expenses. Simultaneously with the
closing of the Placement, the Company and AMS terminated a previously
announced Agreement and Plan of Merger dated as of February 4, 1996
providing for the merger of AMS Merger Corporation, a wholly owned
subsidiary of the Company, with and into AMS.
Effective May 17, 1996, the Company's Common Stock is traded on
the Nasdaq Small Cap System, having been moved from the Nasdaq
National System as the Company no longer fulfilled the Nasdaq
National System maintenance requirements.
<PAGE>
FORM 10-Q
Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
The following discussion should be read in conjunction with the
attached notes thereto, and with the audited financial statements and
notes thereto for the nine month period ended September 30, 1995.
Results of operations for the three and six months ended March 31,
1996 include MDI's operations.
Results of Operations
---------------------
Imaging Systems sales totaled $2,219,000 and $2,269,000 for the
three and six months ended March 31, 1996 versus $1,921,000 and
$1,984,000 for the three and six month periods ended March 31, 1995.
The Company expects system sales to fluctuate from quarter to quarter
as products continue to be commercialized. As a percentage of
revenues, cost of goods sold was approximately 62% and 61% for the
three and six month periods ended March 31, 1996 versus 54% and 62%
for the three and six month periods ended March 31, 1995. Costs of
goods sold for the three months ended December 31, 1994 included
unabsorbed overhead variances. As of April 30, 1996, there was a
backlog for one 3T system including two InstaScan Whole Body and one
InstaScan Neuro coils with a value of $2.5 million. This shipment is
expected to be made in the third quarter of fiscal 1996.
Net patient service revenue of $6,266,000 and $12,279,000 for
the three and six months ended March 31, 1996 represents the
contribution from the Imaging and Rehabilitation Services business
acquired on August 31, 1995. The cost of service operations of
$3,975,000 and $7,755,000 for the three and six month periods ended
March 31, 1996 and the provision for bad debt and collection costs of
$499,000 and $973,000 for the three and six month periods ended March
31, 1996 similarly relate to these service revenues. The Company
expects that MDI will contribute significant revenue and operating
income in fiscal 1996 and beyond, which earnings will be
significantly enhanced by the tax net operating loss carryforwards
available to the Company.
Research and development expenses related to Imaging Systems
decreased to $693,000 (including $276,000 by AMS) for the three
months ended March 31, 1996 from $761,000 (including $243,000 by AMS)
for the three months ended March 31, 1995. Similarly, research and
development expenses decreased to $1,343,000 (including $498,000 by
AMS) for the six months ended March 31, 1996 from $1,529,000
(including $518,000 by AMS) for the six months ended March 31, 1995.
These spending levels reflect the Company's investment in product
upgrades and new products based on its proprietary EPI technology as
well as software enhancement and the development of a localization
and biopsy device for the dedicated MR Breast Imaging system of its
subsidiary AMS.
Selling, general, and administrative expenses increased from
$819,000 and $2,326,000 (including $279,000 and $743,000 by AMS) for
the three and six months ended March 31, 1995 to $2,681,000 and
$5,120,000 (including $432,000 and $1,020,000 by AMS) for the three
and six months ended March 31, 1996. These increases were primarily
due to the addition of $1,089,000 and $2,091,000 from MDI operations
for the three and six month periods ended March 31, 1996.
Interest expense increased from $4,000 and $8,000 for the three
and six month periods ended March 31, 1995 to $499,000 and $990,000
for the three and six months ended March 31, 1996 primarily due to
the financing of the MDI acquisition, effective August 31, 1995, and
MDI's operations for the first six months of fiscal 1996.
Effective with the merger with MDI, minority interests in net
income of consolidated entities consists of earnings allocated to
MDI's joint venture partners offset by losses related to AMS minority
shareholders. For the three and six months ended March 31, 1996,
losses allocated to AMS shareholders exceeded the allocation of
earnings to MDI's partners by $76,000 and $60,000, respectively. In
the comparable three and six month periods ended March 31, 1995, the
total minority interests represents only the allocation of AMS losses
to minority shareholders.
Liquidity and Capital Resources
-------------------------------
At March 31, 1996 the Company had working capital of $8,364,000,
including available cash and cash equivalents of $3,343,000
(including $1,429,000 at MDI and $315,000 at AMS). The decrease from
the September 30, 1995 cash and cash equivalents balance of
$7,543,000 is the result of payment of approximately $1,650,000
required to complete the MDI acquisition, which included common stock
not yet converted by former MDI shareholders as well as funding
working capital requirements.
As part of the MDI acquisition, the Company entered into a
$15,000,000 bank credit facility, consisting of a $6,000,000
revolving credit loan which matures in August 1998, and a $9,000,000
term loan which expires in August 2001. As of April 30, 1996,
$4,355,000 of the revolving loan has been utilized, including
$800,000 for letters of credit securing certain MRI units operated by
MDI, and the balance of the term loan is $8,500,000.
The Company expects that 1) existing cash balances 2) revenues
projected to be generated by Imaging Systems sales and 3) steady
earnings by MDI, which will be enhanced by net operating loss
carryforwards thereby decreasing the Company's income tax provision,
will be sufficient to meet the Company's operating and related debt
service requirements in fiscal 1996. In addition, the Company is
seeking to obtain funds through debt or additional equity placements.
However, there is no assurance that such placements would be
successful or on terms not dilutive to present stockholders.
The decrease in cash used in operating activities for the six
months ended March 31, 1996 as compared with the six months ended
March 31, 1995 reflects the amortization of goodwill related to the
merger with MDI, effective August 31, 1995, as well as other
imaging and rehabilitation service related depreciation. Cash used
in investing activities for the six months ended March 31, 1996
reflects payments to former MDI shareholders totaling $1,650,000
which were payable at September 30, 1995. The significant cash
flows from financing activities for the six months ended March 31,
1995 include proceeds totaling $2,558,000 from the exercise of AMS
warrants and partial repayment totaling $110,000 of a note
receivable. During the six months ended March 31, 1996, cash used
by financing activities includes repayment of long-term debt, net
of proceeds from borrowings, of $546,000, distributions to minority
interests totaling $558,000 and proceeds from the exercise of stock
options of $131,000.
<PAGE>
FORM 10-Q
PART II OTHER INFORMATION<PAGE>
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule.
(b) Form 8-K
On February 9, 1996, the Company filed a Form 8-K announcing
under Item 5 that the Company and its wholly-owned subsidiary, AMS
Merger Corporation, entered into an Agreement and Plan of Merger
dated as of February 4, 1996 with AMS.
On February 21, 1996, the Company filed a Form 8-K announcing
under Item 5 that it learned on February 15, 1996 that a class
action complaint was filed on February 15, 1996 in the Court of
Chancery of the State of Delaware, New Castle County, against the
Company, AMS and certain directors of the Company and AMS seeking
to (i) enjoin the previously announced merger, or (ii) if the
merger is consummated, to award rescissory damages to the proposed
class of plaintiffs.
On March 15, 1996, the Company filed a Form 8-K announcing
under Item 5 that a class action complaint was filed on February
28, 1996 in the Court of Chancery of the State of Delaware, New
Castle County, against the Company, AMS and certain directors of
the Company and AMS seeking substantially similar relief to that
sought in the February 9, 1996 complaint.
On May 16, 1996, the Company filed a Form 8-K announcing under
Item 5 the termination of the previously announced merger with
Advanced Mammography Systems, Inc. and that the Company's Common
Stock will be traded on the Nasdaq Small Cap System.
<PAGE>
FORM 10-Q
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.
Advanced NMR Systems, Inc.
(Registrant)
Date May 17, 1996 /s/ Jack Nelson
------------ --------------------------
Jack Nelson
Chief Executive Officer
Date May 17, 1996 /s/ Charles M. Moche
------------ --------------------------
Charles M. Moche
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit Description
------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
UNAUDITED CONSOLIDATED BALANCE SHEETS, STATEMENTS OF OPERATIONS,
STATEMENT OF STOCKHOLDERS' EQUITY AND STATEMENTS OF CASH FLOWS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> MAR-31-1996
<CASH> 3,342,997
<SECURITIES> 0
<RECEIVABLES> 12,654,910
<ALLOWANCES> 2,358,000
<INVENTORY> 5,291,909
<CURRENT-ASSETS> 20,701,652
<PP&E> 9,291,123
<DEPRECIATION> 0
<TOTAL-ASSETS> 57,304,271
<CURRENT-LIABILITIES> 12,337,584
<BONDS> 0
0
0
<COMMON> 302,593
<OTHER-SE> 25,526,350
<TOTAL-LIABILITY-AND-EQUITY> 57,304,271
<SALES> 8,729,152
<TOTAL-REVENUES> 8,905,807
<CGS> 1,366,895
<TOTAL-COSTS> 1,366,895
<OTHER-EXPENSES> 7,348,881
<LOSS-PROVISION> 499,375
<INTEREST-EXPENSE> 498,723
<INCOME-PRETAX> (732,025)
<INCOME-TAX> 17,983
<INCOME-CONTINUING> (750,008)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (750,008)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> (.02)
</TABLE>
