FORM 10-Q
Securities and Exchange Commission
Washington, D. C. 20549
(Mark One)
X Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended : February 28, 1995
OR
_ Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Commission File Number : 0-14820
IMMUCOR, INC.
(Exact name of registrant as specified in its charter)
Georgia 22-2408354
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3130 Gateway Drive P.O. Box 5625 Norcross, Georgia 30091-5625
(Address of principal executive offices) (Zip Code)
Registrant's telephone number : (404) 441-2051
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
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
As of April 10, 1995: Common Stock, $.10 Par Value - 7,703,080
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
IMMUCOR, INC.
Balance Sheets
February 28, May 31,
ASSETS 1995 1994
(Unaudited) (Audited)
Current assets:
Cash and cash equivalents $18,056,367 $18,303,252
Accounts receivable, net 7,956,272 6,981,070
Inventories 5,169,489 5,158,120
Income tax receivable 157,595 137,944
Deferred income taxes 216,503 207,599
Other 850,579 715,726
Total current assets 32,406,805 31,503,711
Long-term investment 1,000,000 1,000,000
Property, plant and equipment, at cost 5,090,430 4,344,708
less accumulated depreciation (2,271,358) (1,751,880)
2,819,072 2,592,828
Other assets 151,215 153,705
Excess of cost over net tangible
assets acquired 6,274,986 6,061,147
$42,652,078 $41,311,391
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Bank loans $538,295 $6,504,561
Accounts payable 2,889,368 2,548,653
Income taxes payable 462,871 345,638
Accrued salaries and wages 385,858 446,899
Other accrued liabilities 239,726 439,241
Total current liabilities 4,516,118 10,284,992
Long-term debt 5,460,378
Shareholders' equity:
Common stock, $.10 par value 981,077 980,421
Additional paid-in capital 26,998,503 26,988,275
Retained earnings 14,223,157 12,366,588
Cost of shares held in treasury (8,455,035) (8,455,035)
Cumulative translation adjustment (1,072,120) (853,850)
Total equity 32,675,582 31,026,399
$42,652,078 $41,311,391
See accompanying notes.
IMMUCOR, INC.
Statements of Income
(Unaudited)
Three Months Ended Nine Months Ended
Feb. 28, Feb. 28, Feb. 28, Feb. 28,
1995 1994 1995 1994
Net sales $7,234,450 $7,004,325 $21,476,209 $22,293,819
Cost of sales 2,585,080 2,852,896 8,384,007 9,038,520
Gross profit 4,649,370 4,151,429 13,092,202 13,255,299
Research & development:
Instrument 243,927 535,126 586,184 1,736,817
General 120,259 131,182 362,485 349,911
Selling, general and
administrative 3,149,640 3,019,667 9,150,764 9,064,862
Total operating expenses 3,513,826 3,685,975 10,099,433 11,151,590
Income from operations 1,135,544 465,454 2,992,769 2,103,709
Other income 141,553 82,181 451,739 205,957
Interest expense (102,625) (140,567) (362,457) (455,581)
Other expense (4,640) (3,717) (5,392) (25,406)
Total other 34,288 (62,103) 83,890 (275,030)
Income before income taxes 1,169,832 403,351 3,076,659 1,828,679
Provision for income taxes 449,852 217,376 1,220,090 642,688
Net income $719,980 $185,975 $1,856,569 $1,185,991
Net income per common
and common equivalent share $0.09 $0.02 $0.24 $0.15
See accompanying notes.
IMMUCOR, INC.
Statements of Cash Flows
(Unaudited)
Nine Months Ended
February 28, February 28,
1995 1994
CASH PROVIDED BY OPERATING ACTIVITIES
Net income $1,856,569 $1,185,991
Adjustments to reconcile net income to
net cash provided by operations:
Depreciation 560,244 325,034
Amortization 269,027 218,050
Changes in assets and liabilities:
Increase in accounts receivable (975,203) (270,925)
Increase in inventories (11,369) (9,101)
Increase in other current assets (200,915) (122,210)
Increase/(Decrease) in accounts payable 340,714 (658,569)
Decrease in accrued salaries and wages (61,041) (75,344)
Increase in taxes payable 117,233 214,853
Increase/(Decrease) in accrued liabilities (199,516) 399,478
Cash provided by operating activities 1,695,743 1,207,257
CASH USED IN INVESTING ACTIVITIES:
Purchase/deposits on property and equipment (786,487) (169,751)
Other 40,000 (19,843)
Cash used in investing activities (746,487) (189,594)
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in bank loans 779,473
Repayment of bank loans (1,178,154)
Exercise of stock options 10,884 397,829
Repurchase of stock (333,516)
Cash provided(used) in financing activities (1,167,270) 843,786
Effect of exchange rate changes on cash (1,590) (211,080)
INCREASE IN CASH AND CASH EQUIVALENTS (246,884) 1,650,369
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 18,303,252 16,544,406
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $18,056,368 $18,194,775
See accompanying notes.
IMMUCOR, INC.
Notes to Financial Statements
(Unaudited)
1. In the opinion of management, the information furnished
reflects all adjustments (consisting only of normal recurring
adjustments) necessary for a fair presentation of the results for
the interim periods. Revenues from product sales are recognized
at the time of shipment.
2. Inventories are stated at the lower of first-in, first-out
cost or market:
As of As of
February 28, 1995 May 31, 1994
Raw materials and supplies $1,695,514 $1,263,129
Work in process 950,307 413,226
Finished goods 2,523,668 3,481,765
3. Net income per common share:
Net income per common share is computed using the weighted
average number of common shares and dilutive common share
equivalents outstanding during the respective periods. Common
share and common share equivalents were 7,746,718 and 7,756,591
in the 1995 three and nine month comparable periods, and
7,847,804 and 7,831,016 in the 1994 three and nine month periods.
There is no significant difference between primary and fully
diluted per share amounts.
4. Domestic and foreign operations:
Information concerning the Company's domestic and foreign
operations is summarized below:
Three Months Ended February 28, 1995:
Net Revenues United States Europe Eliminations Consolidated
Unaffiliated customers $3,797,245 $3,437,205 $7,234,450
Affiliates 894,934 40,606 $(935,540)
--------------------------------------------------
Total 4,692,179 3,477,811 (935,540) 7,234,450
Income from operations 1,049,232 90,441 (4,129) 1,135,544
Identifiable assets 28,722,869 16,809,269 (2,880,060) 42,652,078
Nine Months Ended February 28, 1995:
Net Revenues United States Europe Eliminations Consolidated
Unaffiliated customers $11,465,286 $10,010,923 $21,476,209
Affiliates 2,536,378 123,077 $(2,659,455)
---------------------------------------------------
Total 14,001,664 10,134,000 (2,659,455) 21,476,209
Income from operations 2,873,821 143,015 (24,067) 2,992,769
Identifiable assets 28,722,869 16,809,269 (2,880,060) 42,652,078
Sales to affiliates are valued at market prices.
5. Accounting for income taxes:
The provision for income tax expense for the three months
and nine months ended February 28, 1995 was $449,852, and
$1,220,090, respectively. The information required to determine
the current and deferred portion of these provisions was not
available.
IMMUCOR, INC.
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Financial Condition and Liquidity:
As of February 28, 1995, the Company's cash position totaled
$18,056,400. For the nine months ended February 28, 1995, the
Company generated cash from operating activities of $1,695,700.
As of May 31, 1994, the Company's deutsche mark denominated debt
totaled 9,750,000 marks. Since the beginning of the fiscal year,
and through March 30, 1995, total deutsche mark debt has been
reduced 1,750,000 marks. On March 30, 1995, the Company
refinanced its remaining 8,000,000 deutsche mark bank debt (or
$5,460,400) with a U.S. bank under a 6.9% interest rate swap
agreement due September 30, 1998. The Company intends to make
periodic principal payments, but is not required to do so.
The Company does not have any material capital commitments.
Management believes that the Company's current cash balance,
internally generated funds, and amounts available under the lines
of credit are sufficient to support operations for the
foreseeable future. Management also believes additional credit
lines would be available should the need arise.
Results of Operations:
Net sales
Net sales for the three months ended February 28, 1995, were
$7,234,500 compared to $7,004,300 in the prior year three month
period, and for the nine month period, net sales totaled
$21,476,200 versus $22,293,800 last year. Prior year three and
nine month sales included $222,400 and $1,210,100, respectively,
of the Company's blood bag business in Germany, which was
discontinued. Excluding blood bag sales last year, net sales
increased 7% in the third quarter due to higher sales of the
Company's Capture (Registered Trademark) product line and favorable
rates of foreign exchange, primarily in Germany, which caused
German deutsche mark sales to be translated into higher US dollar sales.
Gross profit
Gross profit, as a percentage of sales revenue, increased
during the three and nine month periods ended February 28, 1995
as compared to the same periods in fiscal 1994. The increase in
gross profit can be attributed to discontinuing the Company's
blood bag business in Germany last fiscal year, as blood bags
were sold at a lesser gross margin than the Company's other
products (see Net sales above). In addition, more favorable
foreign exchange rates in Europe in the current year three and
nine month periods reduced the cost of goods purchased in U.S.
dollars and sold in Europe in local currencies.
Operating expenses
Instrument research and development expenses for the three
and nine months ended February 28, 1995 totaled $243,900 and
$586,200 respectively, compared to $535,100 and $1,736,800 in the
comparable periods last year. The decline in instrument research
and development expenses reflects the near completion of the
development phase of the Company's blood bank instrument project,
known as the ABS 2000.
Other income
Other income increased $59,400 during the three months ended
February 28, 1995 as compared to the same period last year,
primarily due to higher interest rates in the current year period
over last year, which increased earnings on invested cash
reserves.
Provision for income taxes
The provision for income taxes increased $232,500 to
$449,900 for the three months ended February 28, 1995, and for
the nine months ended February 28, 1995, the provision for income
taxes increased $577,400 to $1,220,100. This increase can
principally be attributed to a reduced research and development
tax credit resulting from the decline in research and development
spending (see Operating expense, above). The prior year
provision included a retroactive research and development tax
credit of $95,000 resulting from the Omnibus Budget
Reconciliation Act of 1993 enacted on August 10, 1993.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) The Company has filed the following exhibits with
this report:
11.1 Statement re computation of per share earnings.
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.
IMMUCOR, INC.
(Registrant)
Date: April 10, 1995
Edward L. Gallup_____________Edward L. Gallup
President
Richard J. Still_______________ Richard J. Still
Senior Vice President - Finance
(Principal Accounting Officer)
IMMUCOR, INC.
EXHIBITS
Exhibit 11.1 Statement re computation of per share earnings.
Income per share calculations:
Three Months Ended Nine Months Ended
Feb. 28, Feb. 28, Feb. 28, Feb. 28,
1995 1994 1995 1994
Net income $719,980 $185,975 $1,856,569 $1,185,991
weighted average number of common
shares and common share
equivalents are as follows:
Weighted average common shares
outstanding 7,695,081 7,729,088 7,692,914 7,659,285
Shares issued from assumed
exercise of options and warrants 51,637 118,716 63,677 171,731
Weighted average number of shares
outstanding (as adjusted) 7,746,718 7,847,804 7,756,591 7,831,016
Net income per common
and common equivalent share $0.09 $0.02 $0.24 $0.15
===== ===== ===== =====
Note: shares issued from assumed exercise of options and warrants include the
number of incremental shares which result from applying the "treasury stock
method" for options and warrents in 1995 and 1994, APB 15, paragraph 36.
There is no significant difference between primary and fully diluted per share
amounts.
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