<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
AMENDMENT NO. 1
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 30, 1996
JONES MEDICAL INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-15098 43-1229854
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1945 Craig Road, St. Louis, MO 63146
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (314) 576-6100
---------------------------------------------------------------------
(Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro Forma Financial Information
Pro Forma Financial Information Introduction.
Unaudited Pro Forma Combined Balance Sheet as of June 30, 1996.
Unaudited Pro Forma Combined Statement of Operations for the Six Months
Ended June 30, 1996.
Unaudited Pro Forma Combined Statement of Operations for the Year Ended
December 31, 1995.
Unaudited Pro Forma Combined Statement of Operations for the Year Ended
December 31, 1994.
Unaudited Pro Forma Combined Statement of Operations for the Year Ended
December 31, 1993.
<PAGE> 2
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 hereunto duly authorized.
JONES MEDICAL INDUSTRIES, INC.
By: /s/ Dennis M. Jones
--------------------------
Name: Dennis M. Jones
Title: President
Date: October 1, 1996
2
<PAGE> 3
Pro Forma Financial Information Introduction
On August 30, 1996, Jones Medical Industries, Inc. ("JMI") acquired Daniels
Pharmaceuticals, Inc. ("Daniels"), a Florida corporation, by way of a merger
(the "Merger") among Daniels, Daniels' parent entity, Galen Drugs of Florida,
Inc. ("Galen"), a Florida corporation, and JMI's wholly owned subsidiary, JGD
Acquisition Corporation, a Florida corporation. Daniels, which was the
principal operating entity of Galen, manufactures prescription pharmaceutical
products. Daniels' principal product is Levoxyl(R), a synthetic thyroid hormone
for the treatment of hypothyroidism. Daniel's other products include
Soloxine(R), a branded formulation of Levothyrozine for veterinary treatment of
hypothyroidism.
In connection with the Merger, JMI issued 2,910,474 shares of its common stock
and paid cash consideration of approximately $4,022,000 in satisfaction of
dissenters' rights. The Merger was structured to qualify as a tax-free
reorganization for income tax purposes and is being accounted for as a pooling
of interests. In addition, JMI issued 49,750 shares of its common stock to
Daniels Enterprises, Inc. ("DEI"), a subchapter S-Corporation controlled by the
principal shareholders of Galen, to acquire the real estate associated with the
business.
The unaudited pro forma combined balance sheet reflects the cash paid in
connection with the Merger and the related acquisition of real estate
associated with Daniels' business as if the acquisition had occurred on June
30, 1996. Cash and non-cash expenses totaling an estimated $5,750,000 related
to the Merger have not been included in the unaudited pro forma combined
balance sheet as of June 30, 1996 or the unaudited pro forma combined
statement of operations for the six months ended June 30, 1996, since such
expenses, net of applicable tax benefits, will generally be charged against
third quarter consolidated income of JMI. The unaudited pro forma combined
statements of operations for the six months ended June 30, 1996, and each of
the three years ended December 31, 1995, give effect to the transaction as if
completed prior to the commencement of such periods.
The unaudited pro forma financial statements are not necessarily indicative of
the financial position or results which actually would have been attained if the
Merger had been consummated on the dates indicated above, nor are the pro forma
combined results of operations for the six months ended June 30, 1996,
necessarily indicative of the results to be expected for the 1996 fiscal year.
The following unaudited pro forma financial statements give retroactive effect
to the Merger but do not reflect the anticipated cost savings and restructuring
charges which will result from the combination of JMI and Galen. In the opinion
of the Registrant's management, all adjustments necessary to present fairly the
pro forma financial statements have been made based on the terms and structure
of the Merger. However, the preparation of pro forma financial information
requires many assumptions which may differ from actual operations.
<PAGE> 4
UNAUDITED PRO FORMA COMBINED BALANCE SHEET AS OF JUNE 30,1996
<TABLE>
<CAPTION>
JONES MEDICAL GALEN PRO FORMA PRO FORMA
INDUSTRIES DRUGS ADJUSTMENTS COMBINED
------------- ------------ ----------- ---------
<S> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS
CASH & CASH EQUIVALENTS $ 60,729,142 $ 1,183,290 (a)$(4,022,411) $ 57,890,021
ACCOUNTS RECEIVABLE (Net of allowances) 8,834,630 2,457,854 11,292,484
INVENTORY 11,501,116 2,711,112 14,212,228
DEFERRED INCOME TAXES 933,790 760,282 1,694,072
PREPAID EXPENSES & OTHER 881,267 114,414 995,681
------------ ----------- ----------- ------------
TOTAL CURRENT ASSETS 82,879,945 7,226,952 (4,022,411) 86,084,486
NON-CURRENT ASSETS
NET PLANT, PROPERTY & EQUIPMENT 16,204,452 2,850,847 (b) 892,443 19,947,742
INTANGIBLE ASSETS, NET 57,765,666 57,765,666
NOTE RECEIVABLE 114,359 114,359
OTHER ASSETS 2,569,649 2,569,649
------------ ----------- ----------- ------------
TOTAL NON-CURRENT ASSETS 76,539,767 2,965,206 892,443 80,397,416
TOTAL ASSETS $159,419,712 $10,192,158 $ (3,129,968) $166,481,902
============ =========== =========== ============
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
ACCOUNTS PAYABLE & ACCRUED EXPENSES $ 4,966,062 $ 2,441,291 $ 7,407,353
CURRENT PORTION -- LONG-TERM DEBT 12,660,000 12,660,000
INCOME TAXES PAYABLE 1,007,297 77,349 1,084,646
DIVIDENDS PAYABLE 499,987 499,987
------------ ----------- ------------
TOTAL CURRENT LIABILITIES 19,133,346 2,518,640 21,651,986
LONG TERM DEBT 3,000,000 3,000,000
DEFERRED INCOME TAXES 4,118,047 408,910 4,526,957
STOCKHOLDERS' EQUITY
COMMON STOCK 1,001,284 1,029 (c) 116,351 1,118,664
PREFERRED STOCK
CONTRIBUTED CAPITAL 95,066,240 (d) (3,246,319) 91,819,921
RETAINED EARNINGS 37,100,795 7,263,579 44,364,374
------------ ----------- ----------- ------------
TOTAL STOCKHOLDERS' EQUITY 133,168,319 7,264,608 (3,129,968) 137,302,959
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $159,419,712 $10,192,158 $(3,129,968) $166,481,902
============ =========== =========== ============
</TABLE>
(a) Adjustment to reflect cash paid for dissenters' shares purchased by JMI in
connection with the Merger. Does not reflect cash portion of expenses
of the acquisition and related matters.
(b) Adjustment to reflect net book value of real estate acquired from DEI in
exchange for shares of JMI.
(c) Adjustment to reflect the issuance of JMI common stock and the elimination
of Galen's common stock. The offset was to contributed capital.
(d) Reflects the net impact on contributed capital of pro forma adjustments (a),
(b), and (c). Does not reflect impact on contributed capital of certain
expenses related to the acquisition transaction.
<PAGE> 5
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1996
<TABLE>
<CAPTION>
YEAR TO DATE YEAR TO DATE YEAR TO DATE
JONES MEDICAL GALEN PRO FORMA PRO FORMA
INDUSTRIES DRUGS ADJUSTMENTS COMBINED
-------------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
NET SALES $37,988,928 $9,597,054 $47,585,982
COST OF SALES 16,486,570 2,936,181 19,422,751
----------- ---------- -----------
GROSS MARGIN 21,502,358 6,660,873 28,163,231
S, G, & A EXPENSES
SELLING 5,042,664 2,402,111 7,444,775
GENERAL & ADMIN. 2,530,190 1,796,886 4,327,076
RESEARCH & DEVELOPMENT 250,854 250,854
AMORTIZATION 1,225,095 1,225,095
----------- ---------- -----------
TOTAL S, G, & A 8,797,949 4,449,851 13,247,800
OPERATING INCOME 12,704,409 2,211,022 14,915,431
OTHER INCOME (EXPENSE)
INTEREST INCOME 845,491 55,171 900,662
INTEREST EXPENSE (363,648) (697) (364,345)
OTHER INCOME 7,931 7,931
OTHER EXPENSE (367) (25,636) (26,003)
----------- ---------- -----------
TOTAL OTHER 489,407 28,838 518,245
INCOME BEFORE TAXES 13,193,816 2,239,860 15,433,676
INCOME TAXES 5,013,650 833,125 5,846,775
----------- ---------- -----------
NET INCOME $ 8,180,166 $1,406,735 $ 9,586,901
=========== ========== ===========
AVERAGE SHARES OUTST. 24,134,957 (a)2,960,224 27,095,181
EARNINGS PER SHARE 0.34 0.35
</TABLE>
(a) Reflects the shares of JMI issued in connection with the Merger and
acquisition of real estate from DEI.
<PAGE> 6
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995(a)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
JONES MEDICAL GALEN PRO FORMA PRO FORMA
INDUSTRIES DRUGS ADJUSTMENTS COMBINED
------------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
NET SALES $56,397,095 $18,394,720 $74,791,815
COST OF SALES 27,165,896 5,588,494 32,754,390
----------- ----------- -----------
GROSS MARGIN 29,231,199 12,806,226 42,037,425
S, G, & A EXPENSES
SELLING 8,430,912 4,248,277 12,679,189
GENERAL & ADMIN. 4,044,562 3,148,315 7,192,877
RESEARCH & DEVELOPMENT 452,285 452,285
AMORTIZATION 1,429,804 1,429,804
----------- ----------- -----------
TOTAL S, G, & A 13,905,278 7,848,877 21,754,155
OPERATING INCOME 15,325,921 4,957,349 20,283,270
OTHER INCOME (EXPENSE)
INTEREST INCOME 172,709 131,380 304,089
INTEREST EXPENSE (452,097) (202,906) (655,003)
OTHER INCOME 4,254 16,379 20,633
OTHER EXPENSE (125,483) (27,756) (153,239)
----------- ----------- -----------
TOTAL OTHER (400,617) (82,903) (483,520)
INCOME BEFORE TAXES 14,925,304 4,874,446 19,799,750
INCOME TAXES 5,597,000 1,813,491 7,410,491
----------- ----------- -----------
NET INCOME $ 9,328,304 $ 3,060,955 $12,389,259
=========== =========== ===========
AVERAGE SHARES OUTST. 21,863,213 (b)2,960,244 24,823,437
EARNINGS PER SHARE 0.43 0.50
</TABLE>
(a) Statements of Operations for the year ended September 30, 1995 have been
included for Galen.
(b) Reflects the shares of JMI issued in connection with the Merger and
acquisition of real estate from DEI.
<PAGE> 7
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1994(a)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
JONES MEDICAL GALEN PRO FORMA PRO FORMA
INDUSTRIES DRUGS ADJUSTMENTS COMBINED
------------- ----------- ----------- ---------
<S> <C> <C> <C> <C>
NET SALES $47,548,803 $14,605,172 $62,153,975
COST OF SALES 24,685,826 4,817,097 29,502,923
----------- ----------- -----------
GROSS MARGIN 22,862,977 9,788,075 32,651,052
S, G, & A EXPENSES
SELLING 8,043,229 3,913,761 11,956,990
GENERAL & ADMIN. 3,990,735 2,467,107 6,457,842
RESEARCH & DEVELOPMENT 100,683 406,337 507,020
AMORTIZATION 1,362,936 1,362,936
----------- ----------- -----------
TOTAL S, G, & A 13,497,583 6,787,205 20,284,788
OPERATING INCOME 9,365,394 3,000,870 12,366,264
OTHER INCOME (EXPENSE)
INTEREST INCOME 101,255 43,218 144,473
INTEREST EXPENSE (516,274) (181,821) (698,095)
OTHER INCOME 88,132 88,132
OTHER EXPENSE (20,708) (20,708)
----------- ----------- -----------
TOTAL OTHER (326,887) (159,311) (486,198)
INCOME BEFORE TAXES 9,038,507 2,841,559 11,880,066
INCOME TAXES 3,299,000 1,061,168 4,360,168
----------- ----------- -----------
NET INCOME $ 5,739,507 $ 1,780,391 $ 7,519,898
=========== =========== ===========
AVERAGE SHARES OUTST. 21,523,152 (b)2,960,224 24,483,376
EARNINGS PER SHARE 0.27 0.31
</TABLE>
(a) Statements of Operations for the year ended September 30, 1994 have been
included for Galen.
(b) Reflects the shares of JMI issued in connection with the Merger and
acquisition of real estate from DEI.
<PAGE> 8
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1993(a)
<TABLE>
<CAPTION>
HISTORICAL HISTORICAL
JONES MEDICAL GALEN PRO FORMA PRO FORMA
INDUSTRIES DRUGS ADJUSTMENTS COMBINED
------------- ------------ ----------- ---------
<S> <C> <C> <C> <C>
NET SALES $43,215,498 $12,405,460 $55,620,958
COST OF SALES 21,909,428 4,591,451 26,500,879
----------- ----------- -----------
GROSS MARGIN 21,306,070 7,814,009 29,120,079
S, G, & A EXPENSES
SELLING 6,436,103 2,981,005 9,417,108
GENERAL & ADMIN. 3,372,050 2,218,177 5,590,227
RESEARCH & DEVELOPMENT 377,304 281,293 658,597
AMORTIZATION 1,128,703 1,128,703
----------- ----------- -----------
TOTAL S, G, & A 11,314,160 5,480,475 16,794,635
OPERATING INCOME 9,991,910 2,333,534 12,325,444
OTHER INCOME (EXPENSE)
INTEREST INCOME 189,249 11,986 201,235
INTEREST EXPENSE (354,187) (28,579) (382,766)
OTHER INCOME 120,841 120,841
OTHER EXPENSE (19,371) (19,371)
----------- ----------- -----------
TOTAL OTHER (44,097) (35,964) (80,061)
INCOME BEFORE TAXES 9,947,813 2,297,570 12,245,383
INCOME TAXES 3,744,000 916,826 4,660,826
----------- ----------- -----------
NET INCOME (c) $ 6,203,813 $ 1,380,744 $ 7,584,557
=========== =========== ===========
AVERAGE SHARE OUTST. 21,369,710 (b)2,960,224 24,329,934
EARNINGS PER SHARE (c) 0.29 0.31
</TABLE>
(a) Statements of Operations for the year ended September 30, 1993 have been
included for Galen.
(b) Reflects the shares of JMI issued in connection with the Merger and
acquisition of real estate from DEI.
(c) Before cumulative effect of accounting change.
