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 June 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 June 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
June 30, 1995 unaudited and
December 31, 1994 audited.
Consolidated income statements - 3
six months ended June 30, 1995 and 1994
unaudited; and three months ended
June 30, 1995 and 1994 unaudited.
Consolidated statements of cash flows - 4
six months ended June 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
-------------------------------
June 30, December 31,
1995 1994
ASSETS (Unaudited) (Audited)
------- ------------ ------------
Current assets:
Cash $ 742,371 $ 462,942
Short term investments and marketable securities 1,461,761 1,415,499
Accounts receivable 315,709 349,128
Inventory 2,423 0
Notes receivable - current portion 26,916 26,916
Other receivables 19,335 19,717
Prepaid expenses 5,861 5,861
------------ ------------
Total current assets 2,574,376 2,280,063
Fixed assets, net of depreciation 866,031 758,715
Notes receivable - long term 73,054 73,054
Security deposits 21,489 16,382
Excess of cost over book value of acquired subsidiaries 16,928 17,605
Other assets 14,433 14,433
Loan to Dentcare Delivery Systems, Inc. 515,820 515,820
------------ ------------
$ 4,082,131 $ 3,676,072
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
-------------------
Accounts payable $ 451,252 $ 387,847
Current portion of capitalized lease obligations 140,391 107,697
Accrued expenses and taxes 141,018 173,231
Due to plans 307,620 120,110
Federal income tax payable 95,453 52,291
------------ ------------
Total current liabilities 1,135,734 841,176
Capitalized lease obligations, net of current portion 230,300 161,546
Deferred federal income tax payable 40,374 42,403
------------ ------------
Total liabilities 1,406,408 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 700,808 656,032
------------ ------------
Total stockholders' equity 2,675,723 2,630,947
------------ ------------
$ 4,082,131 $ 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 Months Ended For the Three Months End
June 30, June 30, June 30, June 30,
1995 1994 1995 1994
------------ ------------ ------------ ------------
Revenues
--------
Service fee income $ 1,183,851 $ 1,031,127 $ 488,413 $ 505,000
Administrative service income 986,603 1,035,866 501,701 520,979
----------- ----------- ----------- -----------
Total service fee income 2,170,454 2,066,993 990,114 1,025,979
Premium income 3,419,163 3,123,754 1,758,237 1,568,299
Sales-computer services 69,642 18,183 66,374 16,513
----------- ----------- ----------- -----------
Total Revenues 5,659,259 5,208,930 2,814,725 2,610,791
----------- ----------- ----------- -----------
Cost of Revenues
Direct expenses -
related to service fees 911,296 908,136 382,753 435,437
Dental expenses -
related to premium income 2,843,419 2,544,319 1,453,681 1,281,495
Cost of sales -
computer services 29,319 10,028 26,941 6,492
----------- ----------- ----------- -----------
3,784,034 3,462,483 1,863,375 1,723,424
----------- ----------- ----------- -----------
Gross Margin on Revenues 1,875,225 1,746,447 951,350 887,367
------------------------ ----------- ----------- ------------ -----------
Interest expense 18,291 16,029 10,503 7,769
Selling, general and
administrative expense 1,815,573 1,623,566 955,663 854,311
----------- ----------- ----------- -----------
1,833,864 1,639,595 966,166 862,080
----------- ----------- ----------- -----------
Income (loss) before other income
and income taxes 41,361 106,852 (14,816) 25,287
Loss on sale of securities 0 (21,454) 0 (23,421)
Dividend income 7,023 20,520 3,606 7,402
Interest income 54,513 27,761 24,167 6,657
----------- ----------- ----------- -----------
Income (loss)before income taxes 102,897 133,679 12,957 15,925
Provision for income taxes 58,121 75,050 12,212 12,691
----------- ----------- ----------- -----------
Net income $ 44,776 $ 58,629 $ 745 $ 3,234
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Earnings per share
Primary 0.013 0.016 --- 0.001
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Fully diluted 0.012 0.016 --- 0.001
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
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 Six Months Ended
------------ -----------
June 30, June 30,
1995 1994
------------ ------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
Cash flows from operating activities:
Net income $ 44,776 $ 58,629
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 103,846 120,060
Amortization 677 677
Deferred federal income tax payable (2,029) 103
(Increase) decrease in:
Accounts receivable 33,419 (76,603)
Inventory (2,423) 0
Other receivables 382 18,026
Due from plans 0 (16,252)
Prepaid expenses 0 (37,866)
Security deposits and other assets (5,107) 22,000
Increase (decrease) in:
Accounts payable 63,405 (64,098)
Accrued expenses and taxes (32,213) 55,779
Due to plans 187,510 (208,194)
Federal income tax payable 43,162 40,291
------------ ------------
Net cash provided by (used in) operating activities 435,405 (87,448)
------------ ------------
Cash flows from investing activities:
Capital expenditures (211,162) (45,639)
Short term investments and marketable securities (46,262) 363,196
Purchase of marketable securities 0 (251,369)
------------ ------------
Net cash provided by (used in) investing activities (257,424) 66,188
------------ ------------
Net cash used in investing activities
Cash flows from financing activities:
Financing purchase of equipment 163,470 0
Repayment of long-term debt (62,022) (53,849)
Reduction of notes receivable 0 5,108
------------ ------------
Net cash provided by (used in) financing activities 101,448 (48,741)
Net increase (decrease) in cash and cash equivalents 279,429 (70,001)
Cash and cash equivalents at beginning of period 462,942 244,818
------------ ------------
Cash and cash equivalents at end of period $ 742,371 $ 174,817
------------ ------------
------------ ------------
Cash Paid During the Period For:
Interest $ 18,291 $ 16,029
------------ ------------
------------ ------------
Income taxes $ 4,080 $ 430
------------ ------------
------------ ------------
See notes to financial statements which are an integral
part hereof.
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 June 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 JUNE 30,1995 AND 1994
Results of Operations
---------------------
Net income decreased 23.6% to $44,776 during the first six months of 1995, as
compared with $58,629 during the comparable period of 1994. Gross margins
increased 7.4% or $128,778 to $1,875,225 during 1995 as compared to $1,746,447
in 1994. Contributing to the increase in total gross margin was an $100,301
increase in gross margin from service revenues. This increase resulted from the
Company's concentration on and expansion of its administrative service business.
In addition, the Company's computer services had an increase in gross margin of
$32,168 due to the sale of an imaging system. Offsetting these increases, was a
decrease in gross margin from premium income of $3,691, resulting from increased
claims utilization.
During the first six months of 1995 the Company recognized interest and dividend
income of $61,536 as compared to $48,281 during 1994.
Liquidity and Capital Resources
During the first six months of 1995 the Company had a increase in cash and cash
equivalents of $279,429. Operating activities accounted for a $435,405 increase
in cash. Offsetting this increase were net expenditures by the Company during
this period of $47,692 to purchase equipment and $62,022 to repay long-term
debt. In addition, the Company increased its short term investments by $46,262.
6
HEALTHPLEX, INC. & SUBSIDIARIES
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
------ -----------------
Neither the Registrant nor its subsidiaries 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
------ ---------------------------------------------------
At the annual meeting of Stockholders, held on June 29, 1995, the
approval of Libero & Kappel as independent auditor for the fiscal year
ended December 31, 1995 was ratified. 3,239,240 votes were cast for,
9,100 votes were cast against and 10,080 votes abstained with respect
to such proposal.
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 08/10/95 By /S/ Martin Kane
------------- ----------------
Martin Kane
President
Date 08/10/95 By /S/ John Forte
------------- ----------------
John Forte
Chief Accounting Officer
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