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 : August 31, 1996
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 : (770) 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 October 11, 1996: Common Stock, $.10 Par Value - 8,055,077
IMMUCOR, INC.
Balance Sheets
August 31 May 31
ASSETS 1996 1996
(Unaudited) (Audited)
Current assets:
Cash and cash equivalents $19,994,460 $20,533,422
Accounts receivable, net 9,092,596 8,953,473
Inventories 6,222,612 5,932,923
Income tax receivable 39,508 37,119
Deferred income taxes 316,130 312,627
Other 1,202,452 707,623
Total current assets 36,867,758 36,477,187
Long-term investment 1,000,000 1,000,000
Property, plant and equipment,
at cost 7,129,482 6,285,912
less accumulated depreciation (3,383,267) (3,029,388)
3,746,215 3,256,524
Other 637,555 646,994
Excess of cost over net tangible
assets acquired 5,944,902 5,826,153
$48,196,430 $47,206,858
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Bank loans $284,068 $283,335
Accounts payable 2,540,715 2,656,538
Income taxes payable 534,679 263,480
Accrued salaries and wages 548,387 594,853
Other accrued liabilities 126,740 154,607
Total current liabilities 4,034,589 3,952,813
Long-term debt 3,713,958 3,908,795
Deferred income taxes 75,033
Shareholders' equity:
Common stock, $.10 par value 805,508 805,438
Additional paid-in capital 21,490,154 21,485,849
Retained earnings 18,626,178 18,029,010
Cumulative translation adjustment (548,990) (975,047)
Total equity 40,372,850 39,345,250
$48,196,430 $47,206,858
See accompanying notes.
IMMUCOR, INC.
Statements of Income
(Unaudited)
Three Months Ended
August 31, August 31,
1996 1995
Net sales $7,956,885 $7,475,927
Cost of sales 3,137,861 2,762,231
Gross profit 4,819,024 4,713,696
Research and development
Instrument 18,736 133,738
General 134,132 123,768
Selling, general and
administrative 3,834,720 3,322,559
Total operating expenses 3,987,588 3,580,065
Income from operations 831,436 1,133,631
Other income 173,341 177,987
Interest expense (55,402) (93,999)
Other expense (2,000) (250)
Total other 115,939 83,738
Income before income taxes 947,375 1,217,369
Provision for income taxes 350,207 421,602
Net income $597,168 $795,767
Net income per common
and common equivalent share $0.07 $0.09
Weighted average number of common
and common equivalent shares
outstanding 8,626,358 8,472,470
See accompanying notes.
IMMUCOR, INC.
Statements of Cash Flows
(Unaudited)
Three Months Ended
August 31, August 31,
1996 1995
OPERATING ACTIVITIES:
Net income $597,168 $795,767
Adjustments to reconcile net income to
net cash provided by operations:
Depreciation 362,850 190,214
Amortization 119,456 27,726
Changes in assets and liabilities:
Accounts receivable (139,125) (225,618)
Inventories (289,689) (88,487)
Other assets (495,701) (154,881)
Accounts payable (115,824) 4,559
Accrued liabilities 196,866 99,131
Other liabilities 75,033
Net cash provided by operating activities 311,034 648,411
INVESTING ACTIVITIES:
Purchases of/deposits on property and
equipment (852,541) (108,946)
Other 4,420 4,044
Net cash used in investing activities (848,121) (104,902)
FINANCING ACTIVITIES:
Repayment of bank loans (335,098) (362,266)
Proceeds from line of credit 733 43,088
Exercise of stock options 4,375 16,919
Net cash used in financing activities (329,990) (302,259)
Effect of exchange rate changes on cash 328,115 (160,965)
NET (DECREASE)INCREASE IN
CASH AND CASH EQUIVALENTS (538,962) 80,285
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 20,533,422 18,741,681
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $19,994,460 $18,821,966
See accompanying notes.
IMMUCOR, INC.
Notes to Financial Statements
(Unaudited)
1. The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation 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 (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. Operating results for the three
month period ended August 31, 1996 are not necessarily indicative of the
results that may be expected for the year ended May 31, 1997. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report on form 10-K for the year
ended May 31, 1996. 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 August 31, 1996 As of May 31, 1996
Raw materials and supplies $2,008,290 $2,104,677
Work in process 418,971 741,723
Finished goods 3,795,351 3,086,523
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. There is no significant difference between primary and
fully diluted per share amounts.
IMMUCOR, INC.
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Financial Condition and Liquidity:
As of August 31, 1996, the Company's cash position totaled $19,994,460.
During the three months ended August 31, 1996, the Company repaid an
additional $335,098 (500,000 DM) of bank debt in Germany.
The Company is completing a facilities expansion at its US offices in
Norcross, Georgia. The expansion provides an additional 10,000 square feet
of manufacturing, laboratory and office space which should be finished by
December 1996. Planned expenditures include leasehold improvements and
furnishings totaling approximately $900,000.
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 August 31, 1996 totaled $7,956,900
versus $7,475,900 in the comparable prior year three month period. Most of
the increase is due to higher sales activity in the Company's European
operations.
Gross profit
As a percent of sales, gross profit for the three months ended August 31,
1996 totaled 60.6% versus 63.1% last year. The decline in gross profit margin
was principally caused by the Company's decision to focus on obtaining large
national accounts at lower margins in an effort to increase market share
longer term.
Operating expenses
As compared to last year, contract research and development costs declined
$115,000. During the current year period, two ABS2000 automated analyzers
previously expensed as research and development were sold to the Company's
Canadian distributor, and the sale ($70,000) was recorded as a reduction of
current year research and development costs.
Selling, general and administrative expenses for the three month period
ended August 31, 1996 increased $512,200 over the same period last year. As
reported in previous periods, the Company has increased expenditures
significantly in selling, marketing and advertising, including increased
marketing and trade show costs, higher advertising and production promotion
costs, and sales staff additions.
Interest expense
Interest expense declined $38,600 in the current year three month period
as compared to last year. This decline was due to the Company reducing its
outstanding principal loan balance as compared to last year.
Provision for income taxes
The effective tax rate increased in the current year's quarter versus
last year because of the need to provide for income taxes on increased profits
in Germany which are taxed at higher rates than income is taxed in the United
States.
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 Statement re: computation of per share earnings.
(b) The Company did not file any reports on Form 8-K during the three
months ended August 31, 1996.
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: October 11, 1996
/s/Edward L. Gallup_____________Edward L. Gallup, President
/s/Richard J. Still_______________ Richard J. Still, Senior Vice President -
Finance (Principal Accounting Officer)
IMMUCOR, INC.
EXHIBITS
Exhibit 11. Statement re computation of per share earnings.
Primary income per share calculations:
Three Months Ended
August 31, August 31,
1996 1995
Net income $597,168 $795,767
Weighted average number of common
shares and common share equivalents
are as follows:
Weighted average common shares
outstanding 8,055,035 7,707,847
Shares issued from assumed exercise
of options and warrants 571,323 764,623
Weighted average number of shares
outstanding (as adjusted) 8,626,358 8,472,470
Net income per common
and common equivalent share: $0.07 $0.09
Fully diluted income per share calculations:
Three Months Ended
August 31, August 31,
1996 1995
Net income $597,168 $795,767
Weighted average number of common
shares and common share equivalents
are as follows:
Weighted average common shares
outstanding 8,055,035 7,707,847
Shares issued from assumed exercise
of options and warrants 603,912 1,106,320
Weighted average number of shares
outstanding (as adjusted) 8,658,947 8,814,167
Net income per common
and common equivalent share: $0.07 $0.09
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 optionsand warrants.
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