THIS DOCUMENT IS THE RESUBMISSION OF FORM 10QSB FOR THE PERIOD ENDED MARCH 31,
1996 THAT WAS ORIGINALLY FILED ON ACCESSION NUMBERS: 0000740726-96-000009 AND
0000740726-96-000010 ON MAY 15, 1996.
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United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark one)
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
--- ACT OF 1934
For the quarterly period ended March 31, 1996
or
--- TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to _______________
Commission File Number 0-13316
LASER CORPORATION
------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Utah 87-0395567
-------------------------------- ---------------------------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
1832 South 3850 West
Salt Lake City, UT 84104
-------------------------------- ---------------------------------
(Address of principal (Zip Code)
executive office)
(801) 972-1311
------------------------------------------------------------------------
(Issuer's telephone number, including area code)
Not Applicable
------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (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
------- -------
State the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Common Stock, .05 Par Value -- 672,088 shares as of March 31, 1996.
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INDEX
LASER CORPORATION AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
- ------- ---------------------
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets - March 31, 1996 and December 31, 1995.
Consolidated Statements of Operations - Three months ended March 31,
1996 and 1995.
Consolidated Statements of Cash Flows - Three months ended March 31,
1996 and 1995.
Notes to Consolidated Financial Statements - March 31, 1996.
Item 2. Management's Discussion and Analysis.
PART II. OTHER INFORMATION
- -------- -----------------
Exhibit 27 - Financial Data Schedule
SIGNATURES
- ----------
Page 2 of 12
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PART I. FINANCIAL INFORMATION
- ------- ---------------------
Item 1.
LASER CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
ASSETS 1996 1995
Unaudited
----------- -----------
[C] [C]
CURRENT ASSETS
Cash and cash equivalents $ 647,941 $ 936,370
Receivables:
Trade accounts, less allowances of
$7,961 in 1996 and $1,500 in 1995 684,334 539,661
Other --- 4,241
----------- -----------
684,334 543,902
Inventories:
Raw materials 757,761 744,886
Work in process 458,036 423,291
Finished Goods 3,416 17,995
----------- -----------
1,219,213 1,186,172
Notes Receivable - current portion 170,228 171,873
Other current assets 28,714 10,025
----------- -----------
Total Current Assets 2,750,430 2,848,342
NOTES RECEIVABLE LESS CURRENT PORTION 654,674 693,320
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment 1,366,216 1,356,734
Leasehold improvements 583,330 581,180
----------- -----------
1,949,546 1,937,914
Less accumulated depreciation
and amortization (1,703,151) (1,676,807)
----------- -----------
246,395 261,107
OTHER ASSETS 4,299 4,299
----------- -----------
$ 3,655,798 $ 3,807,068
=========== ===========
See accompanying notes to consolidated financial statements
Page 3 of 12
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LASER CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
1996 1995
LIABILITIES AND STOCKHOLDERS' EQUITY (Unaudited)
---------- ----------
[C] [C]
CURRENT LIABILITIES
Trade accounts payable $ 334,583 $ 336,955
Accrued expenses 139,328 145,483
Accrued warranty expense 140,000 140,000
Current portion of capital lease
obligations 13,793 23,410
---------- ----------
Total Current Liabilities 627,704 645,848
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common Stock. $.05 par value;
Authorized Shares - 2,000,000
Issued Shares - 682,088
Outstanding Shares - 672,088 34,105 34,105
Additional paid-in capital 701,537 701,537
Retained earnings 2,392,452 2,525,578
Treasury stock, at cost (100,000) (100,000)
---------- ----------
Total Stockholders' Equity 3,028,094 3,161,220
---------- ----------
$3,655,798 $3,807,068
========== ==========
See accompanying notes to consolidated financial statements
Page 4 of 12
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LASER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
--------------------------
March 31, March 31,
1996 1995
---------- ----------
REVENUES:
Net sales $ 861,505 $1,009,114
Interest and other income 23,852 24,684
---------- ----------
885,357 1,033,798
COSTS AND EXPENSES:
Cost of products sold 698,773 760,908
Selling, general and administrative 139,716 159,776
Research and development 164,815 89,314
Royalties 14,370 14,445
Interest 809 2,859
---------- ----------
1,018,483 1,027,302
---------- ----------
INCOME (LOSS) FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES (133,126) 6,496
INCOME TAX BENEFIT (EXPENSE) - CURRENT --- ---
---------- ----------
INCOME (LOSS) FROM CONTINUING OPERATIONS (133,126) 6,496
INCOME FROM DISCONTINUED OPERATIONS --- ---
INCOME ON DISPOSAL OF DISCONTINUED OPERATIONS --- 53,911
---------- ----------
NET INCOME (LOSS) $ (133,126) $ 60,407
========== ==========
NET INCOME (LOSS) PER SHARE CONTINUING OPERATIONS $ ( .20) $ .01
========== ==========
NET INCOME PER SHARE DISCONTINUED OPERATIONS $ --- $ .08
========== ==========
NET INCOME PER SHARE $ ( .20) $ .09
========== ==========
Average number of shares of
Common Stock outstanding 672,000 689,000
========== ==========
See accompanying notes to consolidated financial statements
Page 5 of 12
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LASER CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
1996 1995
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (133,126) $ 60,407
Less income from disposal of
discontinued operations --- (53,911)
Adjustments to reconcile net income (loss)
to net cash provided from (used in)
operating activities:
Depreciation and amortization 26,344 27,643
(Increase) decrease in assets:
Trade accounts receivable (140,432) (86,562)
Inventories (33,041) (43,502)
Other current assets (18,689) (32,412)
Increase (decrease) in liabilities:
Trade accounts payable and
accrued expenses (8,527) (174,430)
Income taxes payable --- (7,000)
---------- ----------
Net Cash Used in Operating Activities (307,471) (309,767)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (11,632) ---
Payments received on long term notes 40,291 22,255
Proceeds from sale of Pro Med --- 1,000,000
---------- ----------
Net Cash Provided from Investing Activities 28,659 1,022,255
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on long-term debt and
capital lease obligations (9,617) (9,984)
---------- ----------
Net Cash Used in Financing Activities (9,617) (9,984)
---------- ----------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (288,429) 702,504
CASH AND CASH EQUIVALENTS, BEG. OF PERIOD 936,370 70,500
---------- ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 647,941 $ 773,004
========== ==========
See accompanying notes to consolidated financial statements
Page 6 of 12
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SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES
During 1995, the Company sold its 80% owned subsidiary. As part of the
sale price the Company received $1,000,000 in cash and notes receivable totaling
$966,778 and cancellation of notes payable to minority shareholders of Pro Med
of $795,496. A pre-tax gain on the sale of $53,911 was recognized by the
Company. For additional information regarding the sale of Pro Med, please see
Footnote B of the Notes to Consolidated Financial Statements.
See accompanying notes to consolidated financial statements
Page 7 of 12
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LASER CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
March 31, 1996
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and the instructions to Form 10-QSB and Rule 10-01 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
only of normal recurring accruals) considered necessary for a fair presentation
have been included. Operating results for the three months ended March 31, 1996
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1996. For further information, refer to the consolidated
financial statements and footnotes thereto for the year ended December 31, 1995
included in the Company's Annual Report on Form 10-KSB (file number 0-13316).
NOTE B - DISCONTINUED OPERATIONS
On January 1, 1995, the Company entered into two agreements where it
sold its 80 percent ownership in Pro Med. One agreement was with the minority
shareholders of Pro Med wherein the Company sold them 31,726 shares of Pro Med
stock (approximately 40 percent of the Company's ownership). The sales price
was for $1,095,496 and consisted of a cash payment of $300,000 and cancellation
of the note payable to the minority shareholders of Pro Med which had a balance
of $795,496 at December 31, 1994.
The Company sold its remaining 48,274 shares of Pro Med stock
(approximately 60 percent of the Company's ownership) and forgiveness of an
intercompany note for total proceeds of $1,666,778 to Pro Med. The proceeds
consisted of a $700,000 cash payment and notes receivable aggregating in a
balance of $966,778. Both notes receivable are secured by the common stock of
Pro Med and the personal guarantees of the minority shareholders of Pro Med.
The first note of $804,504 requires monthly payments of $16,121 including
interest at 7.5 percent per annum. The entire remaining unpaid balance is due
February 1, 1998. The second note of $162,274 does not bear interest and is
due January 1, 1998.
The sale of Pro Med resulted in a pre-tax gain on the sale of $53,911.
Page 8 of 12
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NOTE C - RECENT ACCOUNTING PRONOUNCEMENT
The financial Accounting Standards Board has issued Statements of
Financial Accounting Standard Statement No. 121, "Accounting for Long Lived
Assets" and No. 123 "Accounting and Disclosure of Stock-Based Compensation."
Statement No. 121 is effective for years beginning after December 15, 1995.
The effect of adoption of Statement No. 121 will not have a material effect on
the Company's financial statements. Statement No. 123 is effective for awards
granted after December 31, 1994, and has required financial presentation for
years beginning after December 15, 1995. The effect of adoption of Statement
123 will not have a material effect on the Company's financial statements.
NOTE D - RECLASSIFICATIONS
Certain 1995 financial statement amounts have been reclassified to
conform to 1996 presentations. These amounts were not material
reclassifications.
Page 9 of 12
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion should be read in conjunction with the
consolidated financial statements and notes thereto appearing elsewhere herein.
RESULTS OF OPERATIONS
- ---------------------
Three months ended March 31, 1996.
Net sales for the three months ended March 31, 1996 were $861,505 as
compared to net sales of $1,009,114 for the comparable period in 1995, a
decrease of $147,609 or 14.6%. This decrease in net sales resulted from a
decrease in laser product sales to one of the Company's principal customers
totaling $138,104, a decrease in service sales to another customer totaling
$122,577, and a decrease in product and service sales to all other customers
totaling $154,848. These decreases were partially offset by an increase in
product and service sales to a new OEM customer of the Company totaling
$267,920. The Company believes, but is not certain, that the decrease in net
sales resulted primarily from the normal quarter to quarter variations in
product and service orders received from its OEM customers. OEM customer orders
are based in part on the end-user demand for customer products which use or
incorporate the Company's products and services. The Company has been notified
by one of its principal customers that future product and service orders will
continue to be at levels below that experienced during 1995.
Cost of products sold as a percent of Company net sales increased from
75.4% in 1995 to 81.1% for the three months ended March 31, 1996. This increase
resulted primarily from increased labor costs and to a higher percentage of
factory overhead costs due to the decrease in net sales.
Selling, general, and administrative expenses for the 1996 period
decreased by $20,060 or 12.6% when compared to the same period in 1995. This
decrease resulted from a reduction in legal and insurance expenses.
Research and development expenditures for the period increased by
$75,501 or 84.5% in 1996 when compared to the same period in 1995. This
increase was the result of the Company's focus on adapting its products to the
specialized requirements of one OEM customer as well as to the development of
solid state laser technologies and products.
As a result of the significant increase in research and development
expenditures and to the other factors described above, the Company recognized
net loss for the three months ended March 31, 1996 of $133,126, or $.20 per
share, compared with net income from continuing operations of $6,496, or $.01
per share, for the first quarter of 1995.
Page 10 of 12
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LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
On March 31, 1996, the Company had working capital of $2,122,726
compared to $2,202,494 at December 31, 1995, a decrease of $79,768 or 3.6%.
Cash equivalents at March 31, 1996 were $647,941 compared to a December 31, 1995
balance of $936,370, a decrease of $288,429 or 30.8%. This decrease was the
result of the financial results experienced during the first quarter of 1996
and to increases in the total amount of accounts receivable, inventory and
other assets.
PART II. OTHER INFORMATION
- -------- -----------------
No material matter occurred during the quarter ended March 31, 1996
that requires disclosure in Part II of the Quarterly Report on Form 10-QSB.
Page 11 of 12
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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.
LASER CORPORATION
Date: May 14, 1996 /s/ B. Joyce Wickham
----------------------- ------------------------------------
B. Joyce Wickham
President, Chief Executive Officer
Treasurer and Director
Date: May 14, 1996 /s/ Reo K Larsen
----------------------- ------------------------------------
Reo K Larsen
General Accounting Manager
Page 12 of 12
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM LASER
CORPORATION AND SUBSIDIARIES MARCH 31, 1996 FINANCIAL STATEMENTS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000740726
<NAME> LASER CORP
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 647,941
<SECURITIES> 0
<RECEIVABLES> 1,517,197
<ALLOWANCES> 7,961
<INVENTORY> 1,219,213
<CURRENT-ASSETS> 2,750,430
<PP&E> 1,949,546
<DEPRECIATION> 1,703,151
<TOTAL-ASSETS> 3,655,798
<CURRENT-LIABILITIES> 627,704
<BONDS> 0
0
0
<COMMON> 34,105
<OTHER-SE> 2,993,989
<TOTAL-LIABILITY-AND-EQUITY> 3,655,798
<SALES> 861,505
<TOTAL-REVENUES> 885,357
<CGS> 698,773
<TOTAL-COSTS> 1,017,674
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 809
<INCOME-PRETAX> (133,126)
<INCOME-TAX> 0
<INCOME-CONTINUING> (133,126)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (133,126)
<EPS-PRIMARY> (.20)
<EPS-DILUTED> (.20)
</TABLE>
