<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED SEPTEMBER 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 ____.
COMMISSION FILE #0-4829-03
NORTH AMERICAN BIOLOGICALS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
Delaware 59-1212264
- -------------------------------------------- ------------------------------------------
(State or other jurisdiction of incorporation (I.R.S. Employer Identification No.)
or organization)
5800 Park of Commerce Boulevard N.W., Boca Raton, FL 33487
- ------------------------------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code): (407)989-5800
-------------------------
</TABLE>
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, and (2) has been subject to such filing
requirements for the past 90 days.
YES (X) NO ( )
The number of shares outstanding of registrant's common stock at November 8,
1995 was 19,550,804 shares.
<PAGE> 2
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
NORTH AMERICAN BIOLOGICALS, INC.
<TABLE>
<CAPTION>
Page
INDEX No.
----- ---
<S> <C>
PART I FINANCIAL INFORMATION:
ITEM 1. FINANCIAL STATEMENTS
Consolidated Balance Sheet, September 30, 1995
and December 31, 1994 3
Consolidated Statement of Operations
for the three month and nine month periods ended
September 30, 1995 and 1994 4
Consolidated Statement of Cash Flows
for the nine month periods ended
September 30, 1995 and 1994 5
Notes to Consolidated Financial Statements 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS 9
PART II OTHER INFORMATION:
ITEM 1. LEGAL PROCEEDINGS 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 14
Exhibit 11 - Calculation of Earnings per Share 15
Signatures 16
</TABLE>
2
<PAGE> 3
Part I Financial Information
Item 1 Financial Statements
NORTH AMERICAN BIOLOGICALS, INC.
CONSOLIDATED BALANCE SHEET
($ THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------- ------------
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash $ 2,447 $ 1,982
Trade accounts receivable, net 24,697 22,875
Inventories 22,083 20,713
Prepaid expenses and other assets 2,808 2,485
-------- -------
TOTAL CURRENT ASSETS 52,035 48,055
PROPERTY AND EQUIPMENT, NET 31,693 14,225
OTHER ASSETS:
Excess of acquisition cost over net assets acquired, net 19,184 16,696
Intangible assets, net 11,150 10,616
Other assets 5,011 4,225
-------- -------
TOTAL ASSETS $119,073 $93,817
======== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade accounts payable $ 4,721 $ 6,559
Accrued expenses 10,094 10,465
Notes payable 7,629 5,479
-------- -------
TOTAL CURRENT LIABILITIES 22,444 22,503
NOTES PAYABLE 34,893 19,549
-------- -------
TOTAL LIABILITIES 57,337 42,052
COMMITMENTS AND CONTINGENCIES -- --
STOCKHOLDERS' EQUITY:
Convertible preferred stock, par value $.10 per share:
5,000 shares authorized; no shares outstanding -- --
Common stock, par value $.10 per share: 50,000 shares
authorized; 19,550 and 19,308 shares issued, respectively 1,955 1,931
Capital in excess of par value 37,672 37,781
Retained earnings 22,109 12,179
-------- -------
61,736 51,891
Note receivable from stockholder -- (126)
-------- -------
TOTAL STOCKHOLDERS' EQUITY 61,736 51,765
-------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $119,073 $93,817
======== =======
</TABLE>
The accompanying Notes are an integral part of these Financial Statements.
3
<PAGE> 4
NORTH AMERICAN BIOLOGICALS, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
($ THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
(UNAUDITED) (UNAUDITED)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- ---------------------
1995 1994 1995 1994
------- ------- -------- --------
<S> <C> <C> <C> <C>
Sales $48,090 $43,501 $141,542 $120,781
Costs and expenses:
Cost of products sold 37,830 34,848 112,031 96,355
Selling, general and administrative expenses 3,281 3,350 9,222 9,482
Other operating expenses 981 794 3,305 2,657
------- ------- -------- --------
Operating income 5,998 4,509 16,984 12,287
Interest and other expense, net (745) (888) (1,278) (2,654)
------- ------- -------- --------
Income before provision for income taxes 5,253 3,621 15,706 9,633
Provision for income taxes (1,803) (1,511) (5,776) (3,813)
------- ------- -------- --------
Net income $ 3,450 $ 2,110 $ 9,930 $ 5,820
======= ======= ======== ========
Earnings per share $ 0.17 $ 0.12 $ 0.49 $ 0.35
======= ======= ======== ========
Weighted average number of shares and
common share equivalents (thousands) 20,516 17,229 20,403 16,856
======= ======= ======== ========
</TABLE>
The accompanying Notes are an integral part of these Financial Statements.
4
<PAGE> 5
NORTH AMERICAN BIOLOGICALS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
($ THOUSANDS)
<TABLE>
<CAPTION>
(UNAUDITED)
Nine Months Ended
SEPTEMBER 30,
----------------------
1995 1994
------ ------
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net income $ 9,930 $5,820
Adjustments to reconcile net income to net cash provided (used)
by operating activities:
Depreciation and amortization 3,555 3,327
Loss on disposal of property 170 --
Imputed interest and amortization of debt discount 27 852
Provision for doubtful accounts (71) 389
Compensation under employee stock plan 15 38
Change in assets and liabilities:
Decrease (increase) in accounts receivable (1,751) (3,598)
Decrease (increase) in inventories (838) (5,167)
Decrease (increase) in prepaid expenses (245) (552)
Decrease (increase) in other assets (1,284) (1,110)
Increase (decrease) in accounts payable and accrued liabilities (2,480) 738
------- ------
Total adjustments (2,902) (5,083)
------- ------
NET CASH PROVIDED BY OPERATING ACTIVITIES 7,028 737
CASH FLOW FROM INVESTING ACTIVITIES:
Capital expenditures (18,267) (2,814)
Cash of businesses acquired, net of transaction costs -- 614
Cash consideration for business acquisition (6,075) --
Collection of note receivable from stockholder 126 166
------- ------
NET CASH USED BY INVESTING ACTIVITIES (24,216) (2,034)
CASH FLOW FROM FINANCING ACTIVITIES:
Borrowings under term debt agreement -- 6,125
Repayments of term debt (1,959) (5,625)
Net borrowings under line of credit agreement 4,756 713
Borrowings of flexible term notes 12,936 --
Other debt 1,732 1,617
Contingent purchase price obligation payments -- (1,162)
Proceeds from the exercise of stock options 188 140
------- ------
NET CASH PROVIDED BY FINANCING ACTIVITIES 17,653 1,808
NET INCREASE IN CASH 465 511
CASH AT BEGINNING OF PERIOD 1,982 824
------- ------
CASH AT END OF PERIOD $ 2,447 $1,335
======= ======
</TABLE>
The accompanying Notes are an integral part of these Financial Statements.
5
<PAGE> 6
NORTH AMERICAN BIOLOGICALS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 -- GENERAL
The consolidated financial statements include the accounts of North American
Biologicals, Inc. (the Company) and its subsidiaries. All significant
intercompany accounts and transactions are eliminated in consolidation. These
statements should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's Annual Report to
Stockholders for the year ended December 31, 1994.
In the opinion of management, the unaudited consolidated financial statements
include all adjustments consisting only of normal recurring adjustments
necessary to present fairly the Company's consolidated financial position at
September 30, 1995 and the consolidated results of its operations for the three
and nine month periods ended September 30, 1995 and 1994 and its consolidated
cash flows for the nine months ended September 30, 1995 and 1994. The interim
results of operations are not necessarily indicative of the results which may
occur for the fiscal year.
NOTE 2 -- INVENTORIES
The components of inventories, stated at the lower of cost (FIFO) or market,
are as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
(In Thousands) 1995 1994
---- ----
<S> <C> <C>
Finished goods $15,909 $15,328
Work in process 1,449 1,343
Raw materials 4,725 4,042
------- -------
$22,083 $20,713
======= =======
</TABLE>
NOTE 3 -- PROPERTY AND EQUIPMENT
Property and equipment and related allowances for depreciation and amortization
are summarized below:
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
(In Thousands) 1995 1994
---- ----
<S> <C> <C>
Land and buildings $ 5,498 $ 2,998
Furniture and fixtures 2,817 2,287
Machinery and equipment 12,367 9,635
Leasehold improvements 7,010 5,420
Construction in progress 14,638 3,133
------- -------
Total property and equipment 42,330 23,473
Less accumulated depreciation
and amortization (10,637) (9,248)
------- -------
$31,693 $14,225
======= =======
</TABLE>
Interest capitalized in connection with construction of the Company's
biopharmaceutical facility was approximately $535,000 at September 30, 1995 and
$40,000 at December 31, 1994.
6
<PAGE> 7
NOTE 4 -- PROPOSED MERGER
On August 28, 1995, the Company entered into an Agreement and Plan of Merger
with Univax Biologics, Inc. ("Univax"), pursuant to which Univax will merge
with and into the Company in a tax-free, stock for stock transaction. The
merger will be accounted for as a pooling of interests in accordance with
Accounting Principles Board Opinion No. 16. Stockholder approval of both
companies is a requirement prerequisite to closing; in addition, consent of the
Company's lender as well as the receipt of customary opinions with respect to
tax consequences and compliance letters with respect to the accounting
treatment of the transaction are also prerequisites to closing. A Joint Proxy
Statement/Prospectus dated October 27, 1995 has been furnished to the holders
of record as of October 20, 1995 of both companies. A special meeting of
stockholders of each company will be held on November 29, 1995 to vote for the
approval of the merger.
The following unaudited proforma condensed combined financial statements give
effect to the proposed merger of the Company and Univax.
PROFORMA CONDENSED COMBINED BALANCE SHEET
The unaudited proforma condensed combined balance sheet combines the historical
balance sheets of the Company and Univax, as if the merger had become effective
on September 30, 1995.
<TABLE>
<CAPTION>
(In thousands) SEPTEMBER 30,
1995
-------------
<S> <C>
Current assets $ 67,679
Total assets 142,450
Current liabilities 31,615
Long-term debt 36,189
Total liabilities 67,804
Total equity 74,646
</TABLE>
PROFORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
The unaudited proforma condensed combined statement of operations for the three
and nine months ended September 30, 1995 and 1994 combine the historical
statements of operations of the two companies as if the merger had become
effective January 1, 1994.
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
(In thousands, except per share amounts) SEPTEMBER 30, SEPTEMBER 30,
------------------------------ ------------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales $50,203 $43,979 $146,734 $122,566
Operating loss (291) (1,440) (852) (3,829)
Net loss (2,664) (3,705) (7,067) (10,430)
Loss per common share (0.08) (0.13) (0.21) (0.40)
</TABLE>
7
<PAGE> 8
NOTE 5 -- OTHER MATTERS
From May to August 1995, the Company was named in five civil actions containing
similar claims. The Company denies all allegations against it, and intends to
vigorously defend the cases. Management believes that the ultimate resolution
of these matters will not have a material adverse effect on the Company's
financial position or results of operations. For further information regarding
this matter, see Part II - Other Information, Item I - Legal Proceedings.
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following is a discussion and analysis of the major factors contributing to
the Company's financial condition and results of operations for the three and
nine month periods ended September 30, 1995 and 1994. The discussion and
analysis should be read in conjunction with the consolidated financial
statements and notes thereto. All amounts are expressed in thousands of
dollars, except per share amounts.
RESULTS OF OPERATIONS
The following table sets forth the Company's results of operations for the
respective periods expressed as a percentage of sales:
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------- ---------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales 100.0% 100.0% 100.0% 100.0%
Cost of products sold 78.7 80.1 79.2 79.8
----- ----- ----- -----
Gross margin 21.3 19.9 20.8 20.2
Selling, general and administrative expenses 6.8 7.7 6.5 7.8
Other operating expenses 2.0 1.8 2.3 2.2
----- ----- ----- -----
Operating income 12.5 10.4 12.0 10.2
Interest expense and other, net (1.6) (2.0) (0.9) (2.2)
----- ----- ----- -----
Income before provision for income taxes 10.9 8.4 11.1 8.0
Provision for income taxes (3.7) (3.5) (4.1) (3.2)
----- ----- ----- -----
Net income 7.2% 4.9% 7.0% 4.8%
===== ===== ===== =====
</TABLE>
The following tables set forth certain information concerning sales by industry
segment:
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30,
----------------------------------------------------------------
1995 % 1994 %
---- ----- ---- -----
<S> <C> <C> <C> <C>
Plasma - Source $27,092 56.3% $25,395 58.4%
- Specialty 16,209 33.7 12,484 28.7
------- ----- ------- -----
43,301 90.0 37,879 87.1
Therapeutic products 2,810 5.9 2,240 5.1
Diagnostic products and services 1,979 4.1 3,382 7.8
------- ----- ------- -----
TOTAL $48,090 100.0% $43,501 100.0%
======= ===== ======= =====
</TABLE>
9
<PAGE> 10
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
----------------------------------------------------------------
1995 % 1994 %
---- - ---- -
<S> <C> <C> <C> <C>
Plasma -Source $ 81,264 57.4% $ 73,387 60.7%
-Specialty 44,698 31.6 32,442 26.9
-------- ----- -------- -----
125,962 89.0 105,829 87.6
Therapeutic products 9,400 6.6 6,382 5.3
Diagnostic products and services 6,180 4.4 8,570 7.1
-------- ----- -------- -----
TOTAL $141,542 100.0% $120,781 100.0%
======== ===== ======== =====
</TABLE>
THREE MONTHS ENDED SEPTEMBER 30, 1995 VS. 1994
The Company achieved record sales, operating income and net income for the
three month period ended September 30, 1995. Operating income rose 33% to
$6.0 million for the third quarter of 1995 compared to $4.5 million in the
comparable 1994 quarter. Net income for the third quarter of 1995 was $3.5
million, or $0.17 per share, compared to $2.1 million, or $0.12 per share, in
the third quarter of 1994.
SALES
Sales for the third quarter of 1995 rose 10.5% to $48.1 million compared to
$43.5 million for the third quarter of 1994. Increased volume of plasma
shipments as well as increased sales of immunotherapeutic products were the
primary factors for the increase in overall sales.
GROSS MARGIN
The gross margin improved to $10.3 million or 21.3% of sales in the third
quarter of 1995 compared to a gross margin of $8.7 million or 19.9% of sales in
the third quarter of 1994. An improved sales mix resulting from increased
sales of specialty plasma and immunotherapeutic products was primarily
responsible for the enhanced gross margin.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE
Selling, general and administrative expenses were $3.3 million or 6.8% of sales
for the third quarter of 1995 compared to $3.4 million or 7.7% of sales in the
third quarter of 1994. The reduction in these expenses reflects the Company's
ongoing cost containment measures.
10
<PAGE> 11
OTHER OPERATING EXPENSES
Other operating expenses were $1 million or 2.0% of sales for the 1995 period
compared to $0.8 million or 1.8% of sales for the third quarter of 1994.
Additional freight expenses associated with the increased volume of plasma
shipments during the quarter were primarily responsible for the increase in
expenses.
INTEREST EXPENSE AND OTHER
Interest expense decreased to $0.5 million or 1% of sales in the third quarter
of 1995 from $0.9 million or 2.0% of sales in the third quarter of 1994
primarily due to the early retirement of the Company's subordinated and other
debt in the fourth quarter of 1994. As reflected in Note 3, interest
associated with borrowings to finance construction of the Company's
biopharmaceutical facility is being capitalized as project cost until the
facility is available for commercial production. Interest and other expense
also includes a non-recurring charge of $0.2 million to reserve for loss on
disposition of a property during the third quarter of 1995.
OTHER FACTORS
The effective income tax rates were 34.3% and 41.7% for the 1995 and 1994
quarters, respectively. Recognition of additional foreign trade income in
connection with the filing of the Company's 1994 federal income tax return in
the third quarter reduced the effective tax rate for 1995. The effective tax
rate differed from the federal statutory rate principally due to state income
taxes and non-deductible foreign losses, offset by the effects of foreign trade
income.
NINE MONTHS ENDED SEPTEMBER 30, 1995 VS. 1994
RESULTS OF OPERATIONS
The Company achieved record sales, operating income and net income for the nine
month period ended September 30, 1995. Operating income rose 38% to $17.0
million for the nine months ended September 30, 1995 compared to $12.3 million
in the comparable 1994 period. Net income for the nine months of 1995 was $9.9
million, or $0.49 per share, versus $5.8 million, or $0.35 per share, in the
nine months of 1994.
SALES
Sales for the first nine months of 1995 rose 17.2% to $141.5 million compared
to $120.8 million in the comparable 1994 period. The increase was primarily
attributable to increased plasma shipments, primarily specialty plasma, and an
increase in immunotherapeutic sales.
GROSS MARGIN
The gross margin of $29.5 million or 20.8% of sales in the first nine months of
1995 compared favorably to a gross margin of $24.4 million or 20.2% of sales in
the comparable 1994 period. An improved sales mix resulting primarily from
increased sales of specialty plasma and immunotherapeutics accounted for the
improved gross margin.
11
<PAGE> 12
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE
Selling, general and administrative expenses were $9.2 million or 6.5% of
sales for the first nine months of 1995 compared to $9.5 million or 7.8% of
sales in the first nine months of 1994. The reduction in these expenses
reflects the full integration and economies associated with the Premier
BioResources, Inc. acquisition in January, 1994 and ongoing cost containment
measures.
OTHER OPERATING EXPENSES
Other operating expenses were $3.3 million or 2.3% of sales for the nine months
ended September 30, 1995 compared to $2.7 million or 2.2% of sales for the nine
months ended September 30, 1994. Royalty expenses associated with increased
sales of immunotherapeutics (H-BIG(R)) and additional freight expenses
associated with the increased volume of sales during the 1995 period were
primarily responsible for the increase.
INTEREST EXPENSE AND OTHER
Interest expense decreased to $1.1 million or 0.8% of sales in the first nine
months of 1995 from $2.7 million or 2.2% of sales for the first nine months of
1994, primarily due to the early retirement of the Company's subordinated and
other debt in the fourth quarter of 1994. As reflected in Note 3, interest
associated with borrowings to finance construction of the Company's
biopharmaceutical facility is being capitalized as project cost until
the facility is available for commercial production. Interest and other
expense also includes a non-recurring charge of $0.2 million to reserve for
loss on disposition of a property during the third quarter of 1995.
OTHER FACTORS
The effective income tax rates were 36.8% and 39.6% for the nine months ended
September 30, 1995 and 1994, respectively. Recognition of additional foreign
trade income in connection with the filing of the Company's 1994 federal income
tax return in the third quarter of 1995 reduced the effective tax rate for
1995. The effective tax rate differed from the federal statutory rate
principally due to state income taxes and non-deductible foreign losses, offset
by the effects of foreign trade.
LIQUIDITY AND CAPITAL RESOURCES
As of September 30, 1995, the Company's current assets exceeded current
liabilities by $29.6 million as compared to a net working capital position of
$25.6 million at December 31, 1994. Approximately $7.9 million in a term loan
and $12.1 million in revolving credit loans, under the existing $18 million
revolving credit facility, were outstanding under a credit agreement with the
Company's principal lender at September 30, 1995. On July 27, 1995, the
Company amended its existing credit agreement with its principal lender,
increasing the availability under the revolving line of credit to $18 million
through December 31, 1995. In addition, the Company had $18 million in
flexible term notes outstanding, the proceeds of which were used to finance the
construction of a new biopharmaceutical facility. As reflected in Note 4 to
the Company's consolidated financial statements, lender consent on the proposed
merger with Univax is required. The Company is negotiating an amended loan
agreement with the lender providing for amended loan covenants and increased
credit availability. There can be no assurance that the Company will be
successful in these negotiations.
Projected capital expenditures for the remainder of 1995 include the completion
of construction of the new biopharmaceutical manufacturing facility, which also
includes the Company's executive offices; plasma center
12
<PAGE> 13
renovations and relocations; and recurring improvements and continued
automation of the Company's laboratories and warehouse facilities. The Company
expects that these expenditures and the Company's working capital requirements
will be furnished by a combination of funds on hand, cash flow from operations
and bank borrowings.
13
<PAGE> 14
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is a party to litigation in the ordinary course of business. In
addition, it has been named in the actions described below, but does not
believe that any such litigation will have a material adverse effect on its
financial position or results of operations.
The Company was named in a civil action filed on May 23, 1995 in the Circuit
Court for the Eleventh Judicial Circuit of Dade County, Florida (Case No.
95-10489 CA 02) against Bayer Corporation, Armour Pharmaceutical Company,
Rhone-Poulenc Rorer Inc., Baxter Healthcare Corporation, Alpha Therapeutic
Corporation, NABI and The National Hemophilia Foundation. The plaintiffs
allege that they and their class members are persons infected with HIV as a
result of using HIV-contaminated products of various defendants or as a result
of family relations with those so infected. On June 23, 1995, the case was
removed to the United States District Court for the Southern District of
Florida, Miami Division. The plaintiffs subsequently moved to remand this case
to state court. The federal court's ruling on the removal/remand issue is
pending.
The Company was named in three other civil actions filed on or about July 27,
1995 in the Circuit Court for the Eleventh Judicial Circuit of Dade County,
Florida (Case No., 95-15169, 95-15170 and 95-15171) against Bayer Corporation,
Armour Pharmaceutical Company, Rhone-Poulenc Rorer Inc., Baxter Healthcare
Corporation, NABI and Alpha Therapeutic Corporation. The plaintiffs assert
that use of AHF concentrate made by the defendants other than NABI resulted in
plaintiffs becoming infected with the HIV virus. On September 1, 1995, the
three cases were removed to the United States District Court for the Southern
District of Florida, Miami Division. The plaintiffs subsequently moved to
remand these cases to state court. The federal court's rulings on the
removal/remand issues are pending.
The Company was named in a civil action filed on or about August 9, 1995 in the
Franklin County Common Pleas Court, Civil Division, Columbus, Ohio (Case No.
95-CAB-08-5443) against Bayer Corporation, Armour Pharmaceutical Company,
Rhone-Poulenc Rorer Inc., Baxter Healthcare Corporation, Alpha Therapeutic
Corporation, the American Red Cross, Arthur L. Sagone, Jr., M.D., Arthur L.
Sagone, M.D., Inc., NABI and the National Hemophilia Foundation, Inc. The
plaintiffs' claims arise from the AIDS-related death of an individual who was
treated for hemophilia with coagulation products allegedly contaminated with
HIV. On September 11, 1995, the case was removed to the United States District
Court for the Southern District of Ohio.
The Company denies all claims made against it, and intends to vigorously defend
the cases.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
11 Calculations of Earnings Per Share Page 15
27 Financial Data Schedule (for SEC use only)
b. Reports on Form 8-K:
On September 14, 1995, the Company filed a current report on Form 8-K,
reporting under Item 5 thereof, an Agreement and Plan of Merger entered into
between the Company and Univax.
14
<PAGE> 15
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.
NORTH AMERICAN BIOLOGICALS, INC.
DATE: November 14, 1995 BY: /s/ Alfred J. Fernandez
--------------------- ------------------------------
ALFRED J. FERNANDEZ
Vice President, Finance and
Chief Financial Officer
15
<PAGE> 1
EXHIBIT 11
NORTH AMERICAN BIOLOGICALS, INC.
CALCULATION OF EARNINGS PER SHARE
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
SEPTEMBER 30, SEPTEMBER 30,
---------------------- ----------------------
1995 1994 1995 1994
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net income $ 3,450 $ 2,110 $ 9,930 $ 5,820
Weighted average number of common
shares outstanding during the period 19,526 15,640 19,460 15,311
Add dilutive effect of common
stock equivalents:
Stock options and warrants
(as determined by the application
of the treasury stock method) 990 1,589 943 1,545
------- ------- ------- -------
Weighted average number of shares
and common share equivalents used
in primary earnings per share
computations 20,516 17,229 20,403 16,856
======= ======= ======= =======
Earnings per share $ 0.17 $ 0.12 $ 0.49 $ 0.35
======= ======= ======= =======
</TABLE>
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AT SEPTEMBER 30, 1995 (UNAUDITED) AND THE
CONSOLIDATED STATEMENT OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
1995 (UNAUDITED) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 24,697<F1>
<ALLOWANCES> 0
<INVENTORY> 22,083
<CURRENT-ASSETS> 52,035
<PP&E> 31,693<F1>
<DEPRECIATION> 0
<TOTAL-ASSETS> 119,073
<CURRENT-LIABILITIES> 22,444
<BONDS> 34,893
<COMMON> 1,955
0
0
<OTHER-SE> 59,781
<TOTAL-LIABILITY-AND-EQUITY> 119,073
<SALES> 141,542
<TOTAL-REVENUES> 141,542
<CGS> 112,031
<TOTAL-COSTS> 112,031
<OTHER-EXPENSES> 12,527<F2>
<LOSS-PROVISION> 0<F2>
<INTEREST-EXPENSE> 1,108
<INCOME-PRETAX> 15,706
<INCOME-TAX> 5,776
<INCOME-CONTINUING> 9,930
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9,930
<EPS-PRIMARY> .49
<EPS-DILUTED> 0
<FN>
<F1>Receivables and PP&E represent net amounts.
<F2>Loss provision included in other expenses.
</FN>
</TABLE>
