UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
----------------------------
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
--- -----
Commission file number 0-14236
----------------
Healthplex, Inc.
- -----------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 11-2714365
- -------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
60 Charles Lindbergh Blvd., Uniondale, New York 11553
- ---------------------------------------------------------------------------
(Address of principal executive offices)
516-794-3000
- -------------------------------------------------------
Issuer's telephone number, including area code
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 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
equity, as of the latest practical date: 3,586,682 shares of common stock, par
value $.001 per share, outstanding at September 30, 1995.
Not Applicable
- ----------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
HEALTHPLEX, INC. & SUBSIDIARIES
-------------------------------
INDEX
-----
Part 1. Financial information Page
Consolidated balance sheets 2
September 30, 1995 unaudited and
December 31, 1994 audited.
Consolidated income statements 3
nine months ended September 30, 1995 and 1994
unaudited; and three months ended
September 30, 1995 and 1994 unaudited.
Consolidated statements of cash flows 4
nine months ended September 30, 1995 and 1994
unaudited.
Notes to consolidated financial statements 5
Management's discussion and analysis of 6
financial condition and results of operations.
HEALTHPLEX, INC. & SUBSIDIARIES
- -------------------------------
CONSOLIDATED BALANCE SHEETS
- ---------------------------
September 30, December 31,
1995 1994
ASSETS (Unaudited) (Audited)
- ------ ------------- -------------
Current assets:
- ---------------
Cash $ 543,689 $ 462,942
Short term investments and 1,424,716 1,415,499
marketable securities
Accounts receivable 432,324 349,128
Inventory 2,423 0
Notes receivable - current 26,916 26,916
portion
Other receivables 13,684 19,717
Prepaid expenses 5,861 5,861
------------ ------------
Total current assets 2,449,613 2,280,063
Fixed assets, net of depreciation 828,360 758,715
Notes receivable - long term 73,054 73,054
Security deposits 23,489 16,382
Excess of cost over book value 16,590 17,605
of acquired subsidiaries
Other assets 14,433 14,433
Loan to Dentcare Delivery Systems, Inc. 515,820 515,820
------------ ------------
$ 3,921,359 $ 3,676,072
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current liabilities:
- --------------------
Accounts payable $ 443,906 $ 387,847
Current portion of capitalized 140,391 107,697
lease obligations
Accrued expenses and taxes 106,672 173,231
Due to plans 244,250 120,110
Federal income tax payable 69,768 52,291
------------ ------------
Total current liabilities 1,004,987 841,176
Capitalized lease obligations, 195,202 161,546
net of current portion
Deferred federal income tax payable 39,557 42,403
------------ ------------
Total liabilities 1,239,746 1,045,125
- -----------------
Stockholders' equity:
Common stock $.001 par value, authorized
20,000,000 shares issued & outstanding
3,586,682 in 1995 and 1994 3,587 3,587
Paid-in capital 1,971,328 1,971,328
Retained earnings 706,698 656,032
------------ ------------
Total stockholders' equity 2,681,613 2,630,947
------------ ------------
$ 3,921,359 $ 3,676,072
------------ ------------
------------ ------------
See notes to financial statements which are
an integral part hereof.
2
HEALTHPLEX, INC. & SUBSIDIARIES
------------------ ------------
CONSOLIDATED STATEMENTS OF OPERATIONS
- -------------------------------------
(UNAUDITED)
- -----------
For the Six For the Three
Months Ended Months Ended
Sept. 30, Sept. 30, Sept 30, Sept 30,
1995 1994 1995 1994
Revenues
- --------
Service fee income $ 1,695,408 $ 1,667,540 $ 511,557 $ 636,413
Administrative service 1,584,400 1,546,394 597,797 510,528
income -----------
Total service fee income 3,279,808 3,213,934 1,109,354 1,146,941
Premium income 5,129,010 4,693,207 1,709,847 1,569,453
Sales-computer services 72,567 108,227 2,925 90,044
----------- ----------- ----------- -----------
Total Revenues 8,481,385 8,015,368 2,822,126 2,806,438
----------- ----------- ----------- -----------
Cost of Revenues
- ----------------
Direct expenses - 1,535,167 1,575,689 623,871 667,553
related to service fees
Dental expenses - 4,264,236 3,840,277 1,420,817 1,295,958
related to premium income
Cost of sales - 32,930 70,464 3,611 60,436
computer services ----------- ----------- ----------- -----------
5,832,333 5,486,430 2,048,299 2,023,947
----------- ----------- ----------- -----------
Gross Margin on Revenues 2,649,052 2,528,938 773,827 782,491
- ------------------------ ----------- ----------- ----------- -----------
Interest expense 28,784 23,946 10,493 7,917
Selling, general and 2,606,749 2,430,488 791,176 806,922
administartive expense ----------- ----------- ----------- -----------
2,635,533 2,454,434 801,669 814,839
----------- ----------- ----------- -----------
Income (loss) before other
income and income taxes 13,519 74,504 (27,842) (32,348)
Loss on sale of securities 0 (21,546) 0 (92)
Dividend income 13,260 29,731 6,237 9,211
Interest income 78,360 47,543 23,847 19,782
----------- ----------- ----------- -----------
Income (loss) before income 105,139 130,232 2,242 (3,447)
taxes
Provision for income taxes 54,473 63,981 (3,648) (11,069)
----------- ----------- ------------ -----------
Net income $ 50,666 66,251 5,890 7,622
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
Earnings per share
Primary $ 0.014 $ 0.018 $ 0.002 $ 0.002
----------- ----------- ------------ -----------
Fully diluted $ 0.014 0.018 0.002 0.002
----------- ----------- ------------ -----------
Weighted average number of shares
of common stock outstanding
Primary 3,586,682 3,586,682 3,586,682 3,586,682
----------- ----------- ------------ ----------
Fully diluted 3,627,500 3,627,500 3,627,500 3,627,500
----------- ----------- ------------ ----------
See notes to financial statements which are
an integral part hereof.
3
HEALTHPLEX, INC. & SUBSIDIARIES
- -------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
- -------------------------------------
(UNAUDITED)
- -----------
For the Nine Months Ended
--------------------------------
September 30, September 30,
1995 1994
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS
Cash flows from operating activities:
Net income $ 50,666 $ 66,251
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 156,395 182,300
Amortization 1,015 1,015
Deferred federal income tax payable (2,846)
(Increase) decrease in:
Accounts receivable (83,196) (35,946)
Inventory (2,423) 0
Other receivables 6,033 18,026
Due from plans 0 (6,168)
Prepaid expenses 0 (32,599)
Security deposits and other assets (7,107) 22,000
Increase (decrease) in:
Accounts payable 56,059 (48,121)
Accrued expenses and taxes (66,559) 81,943
Due to plans 124,140 (208,194)
Federal income tax payable 17,477 30,827
Deferred Federal income taxes payable (4,368)
----------- -----------
Net cash provided by (used in) 249,654 66,966
operating activities ----------- -----------
Cash flows from investing activities:
Capital expenditures (226,040) (92,767)
Short term investments and (9,217) 42,029
marketable securities ----------- -----------
Net cash used in investing activities (235,257) (50,738)
----------- -----------
Cash flows from financing activities:
Financing purchase of equipment 163,470 0
Repayment of long-term debt (97,120) (80,773)
Reduction of notes receivable 0 7,714
----------- -----------
Net cash provided by (used in) 66,350 (73,059)
financing activities
Net increase (decrease) in cash and 80,747 (56,831)
cash equivalents
Cash and cash equivalents at beginning 462,942 244,818
of period ----------- -----------
Cash and cash equivalents at end $ 543,689 $ 187,987
of period ----------- -----------
----------- -----------
Cash Paid During the Period For:
Interest $ 28,784 $ 23,946
----------- -----------
Income taxes $ 43,158 $ 7,514
----------- -----------
See notes to financial statements
which are an integral part hereof.
4
HEALTHPLEX, INC. & SUBSIDIARIES
-------------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE 1 - BASIS OF PRESENTATION
- ------------------------------
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-QSB and rule 310 of
regulation S-B. 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 fair presentation have
been included. Operating results for the six months ended September 30, 1995
are not necessarily indicative of the results that may be expected for the year
ended December 31, 1995.
For a summary of significant accounting policies, refer to Note 2 of Notes to
Financial Statements included in the Company's Annual Report on Form 10-KSB for
the year ended December 31, 1994.
5
HEALTHPLEX, INC. & SUBSIDIARIES
-------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,1995 AND 1994
---------------------------------------------------
Results of Operations
- ---------------------
Net income decreased 23.5% to $50,666 during the first nine months of 1995, as
compared with $66,251 during the comparable period of 1994. Gross margins
increased 4.8% or $120,114 to $2,649,052 during 1995 as compared to $2,528,938
in 1994. Contributing to the increase in total gross margin was an $106,396
increase in gross margin from service revenues. This increase resulted from the
Company's concentration on and expansion of its administrative service business.
The Company had an increase in gross margin from premium income of $11,844 due
to a seasonal decrease in dental utilization. In addition the Company's
computer services had an increase in gross margin of $1,874.
During the first nine months of 1995 the Company recognized interest and
dividend income of $91,620 as compared to $77,274 during 1994.
Liquidity and Capital Resources
- -------------------------------
During the first nine months of 1995 the Company had a increase in cash and cash
equivalents of $80,747. Operating activities accounted for a $249,654 increase
in cash. Offsetting this increase were net expenditures by the Company during
this period of $62,570 to purchase equipment and $97,120 to repay long-term
debt. In addition, the Company increased its short term investments by $9,217.
6
HEALTHPLEX, INC. & SUBSIDIARIES
-------------------------------
PART II - OTHER INFORMATION
---------------------------
Item 1. Legal Proceedings
- ------ ------------------
Neither the Registrant nor its subsidiary are a party, nor is any of
their property subject, to material pending legal proceedings or
material proceedings known to be contemplated by governmental
authorities.
Item 2. Changes in Securities
- ------ ---------------------
None
Item 3. Defaults Upon Senior Securities
- ------ -------------------------------
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
- ------ --------------------------------
None
HEALTHPLEX, INC. & SUBSIDIARIES
-------------------------------
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.
Healthplex, Inc.
-------------------------
(Registrant)
Date By
---------- -----------------
Martin Kane
President
Date By
---------- -----------------
John Forte
Chief Accounting Officer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-END> SEP-30-1995
<CASH> 543689
<SECURITIES> 1424716
<RECEIVABLES> 472924
<ALLOWANCES> 0
<INVENTORY> 2423
<CURRENT-ASSETS> 2449613
<PP&E> 2045762
<DEPRECIATION> 1217402
<TOTAL-ASSETS> 3921359
<CURRENT-LIABILITIES> 1004987
<BONDS> 0
<COMMON> 3587
0
0
<OTHER-SE> 2678026
<TOTAL-LIABILITY-AND-EQUITY> 3921359
<SALES> 8481385
<TOTAL-REVENUES> 8573005
<CGS> 5832333
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2606749
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 28784
<INCOME-PRETAX> 105139
<INCOME-TAX> 54473
<INCOME-CONTINUING> 50666
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 50666
<EPS-PRIMARY> .014
<EPS-DILUTED> .014
</TABLE>
