FAMILY HEALTH SYSTEMS INC
10-Q, 2000-06-02
INVESTORS, NEC
Previous: FAMILY HEALTH SYSTEMS INC, 10-Q, EX-27.1, 2000-06-02
Next: FAMILY HEALTH SYSTEMS INC, 10-Q, EX-27.1, 2000-06-02



<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, D.C 20459

                                    FORM 10Q

                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF

                       THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended:  May 31, 1999

Commission File Number:  0-11419

Family Health Systems, Inc.
--------------------------------------------------------------
(Exact Name of Registrant as specified in its Charter)

<TABLE>
<S>                                                 <C>
Delaware                                            22-2435595
----------------------------------------------      ------------------------------------
(State or other jurisdiction of incorporation or    (I.R.S. Employer Identification No.)
        organization)

Post Office Box 21238, St. Simons Island, Georgia   31522-0738
-------------------------------------------------   ------------------------------------
Address of Principal executive offices of           Zip Code
       Incorporation or organization
</TABLE>

912-634-2584
--------------------------------------------------
Registrants 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 and 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 last 90 days.

         YES [ ]                                    NO [X]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as to the latest practical date.

               CLASS                                No. of shares Outstanding on
                                                    May 31, 1999

         Common Stock                                 2,006,757
         Par Value $.00167
         Per share

<PAGE>   2

                                     PART I

                              FINANCIAL INFORMATION


<PAGE>   3



Item 1. Financial Statements

                           FAMILY HEALTH SYSTEMS, INC.

                                  BALANCE SHEET
                                  May 31, 1999
                                   (Unaudited)

<TABLE>
<S>                                                                          <C>
ASSETS

      Cash                                                                   $     9,636
      Accounts receivable                                                            125
      Marketable securities                                                      115,840
                                                                             -----------
               Total current assets                                              125,601
                                                                             -----------

      Other receivables                                                           85,875
                                                                             -----------

      Investment in closely-held company                                          16,875
                                                                             -----------

               Total Assets                                                  $   228,351
                                                                             ===========


LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)


      Cash overdraft - Investment margin account                             $    37,928
                                                                             -----------



      Common Stock                                                                 3,351
      Paid in capital                                                          2,673,705
      Retained earnings (deficit)                                             (2,486,633)
                                                                             -----------
                                                                                 190,423
                                                                             -----------

               Total Liabilities and stockholder's equity (deficit)          $   228,351
                                                                             ===========

</TABLE>



See Notes to Interim Financial Statements.

<PAGE>   4


                           FAMILY HEALTH SYSTEMS, INC.

                               STATEMENT OF INCOME
                         Nine Months Ended May 31, 1999
                                   (Unaudited)


<TABLE>
<S>                                                        <C>
Revenues                                                   $       Nil
                                                           -----------

Expenses
   Auto expense                                                    718
   Miscellaneous                                                 3,096
   Office Supplies                                                 337
   Postage                                                         308
   Professional Fees                                             1,000
   Publications                                                  4,928
   Stock Transfer fee                                           (1,250)
   Telephone                                                       156
   Travel                                                        2,675
                                                           -----------

                                                                11,968
                                                           -----------

Other Income (expense)
   Capital gains on available-for-sale securities               17,221
                                                           -----------

   Net Income                                                    5,253
                                                           -----------

Retained earnings (deficit), beginning                      (2,491,886)
                                                           -----------

Retained earnings (deficit), ending                        $(2,486,633)
                                                           ============
</TABLE>



See Notes to Interim Financial Statements.

<PAGE>   5

                           FAMILY HEALTH SYSTEMS, INC.

                            STATEMENTS OF CASH FLOWS
                  For Three and Nine Months Ended May 31, 1999
                                   (Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                                 For the three months    For the nine months
                                                                    ended 5/31/99           ended 5/31/99
                                                                 --------------------    -------------------
<S>                                                              <C>                     <C>
CASH FLOWS FROM OPERATING ACTIVITIES
     PROVIDED BY (USED IN) OPERATING ACTIVITIES
     Net income (loss)                                                $  (1,235)              $   5,253
     Adjustments to reconcile net income (loss) to
        (Gain) loss on sale of investments                                   --                 (17,222)
     Change in working capital components
        (Increase) decrease in trade receivables                           (125)                   (125)
        (Increase) decrease in other receivables                        (36,552)                (56,075)
        (Increase) decrease in note receivable                               --                   9,155
                                                                      ---------               ---------

        Net cash (used in) operating activities                       $ (37,912)              $ (59,014)
                                                                      =========               =========

CASH FLOWS FROM INVESTING ACTIVITIES
     Proceeds from sale of investments                                  229,934                 695,101
     Purchase of investments                                           (229,934)               (744,233)
     Transfer to operating cash                                          45,750                 100,750
     Transfer from operating cash                                            --                 (36,552)
                                                                      ---------               ---------

     Net cash provided by investing activities                           45,750                  15,066
                                                                      ---------               ---------

     Net increase in cash and cash equivalents                            7,838                 (43,948)

Cash and cash equivalents
     Beginning                                                          (36,130)                 15,656

     Ending                                                           $ (28,292)              $ (28,292)
                                                                      =========               =========

Cash and cash equivalents:
     Operating cash                                                   $   9,636               $   9,636
     Cash (overdraft) - Investment margin account                       (37,928)                (37,928)
                                                                      =========               =========

                                                                      $ (28,292)              $ (28,292)
                                                                      =========               =========
</TABLE>

See Notes to Interim Financial Statements

<PAGE>   6


                           FAMILY HEALTH SYSTEMS, INC.

                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                         Nine Months Ended May 31, 1999

1.       BASIS OF PRESENTATION

                  The accompanying unaudited condensed financial statements have
                  been prepared in accordance with generally accepted accounting
                  principles for interim financial information and wit the
                  instructions to Form 10-Q and Rule 10-01 of Regulations S-X.
                  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 considered necessary for a fair
                  presentation of the operating results for the second quarter
                  of the fiscal year 1997 have been included. Operating results
                  for the quarter ended May 31, 1999 are not necessarily
                  indicative of the results that may be expected for the fiscal
                  year ending August 31, 1999.

2.       CONDENSED PRESENTATION

                  The Condensed balance sheet and income statement was derived
                  form the balance sheet and statement of income for that date.

Item 2. Management's Discussion and Analysis of Financial Condition and results
        of operation

         (A)      General Development of Business.

                  Family Health Systems, Inc. (FHS or REGISTRANT), a Delaware
                  corporation, was incorporated on January 20, 1983. The
                  Registrant was formed to provide comprehensive business
                  services to physicians, dentists and professional corporations
                  operating full service dental centers and emergency/industrial
                  medical centers. FHS found this activity to be unprofitable
                  and it exited the business service activity in fiscal year
                  1987 and became engaged in the formation, registration,
                  distribution and sale of developmental stage companies. FHS
                  has no activities other than investment portfolio management
                  at this time.

         (B)      Description of business:

                  The Registrant is currently inactive in the formation of
                  subsidiaries, by registration of those stocks through filing
                  with the SEC, and is seeking a merger or business combination
                  for itself.

<PAGE>   7


         (C)      Market Risk and Investment Risk:

                  The assets of the Company consist primarily of common stock of
                  publicly traded companies. As such, the value of the assets of
                  the Company may be more or less than historical cost. Any
                  significant declines in market value of investments will
                  results in a write-down to market value in accordance with
                  accounting for investments at lower of cost or market.

Item 3.  Legal Proceedings

                           NONE

Item 4.  Submission of Matters to a Vote of Security Holders:

                           NONE

Item 5.  Other information:

                           NONE

Item 6.  Exhibits and Reports on Form 8-K:

         Exhibit 27.1 Financial Data Schedule (for SEC use only)

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereto duly authorized.


                                           FAMILY HEALTH SYSTEMS, INC.

June 21, 1999                                 /s/ William  S. Bryant
                                           ----------------------------
                                           William S. Bryant, President
                                           Chief Financial Officer




© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission