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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2000
OR
[ ] 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 0-15223
HEMACARE CORPORATION
(Exact name of registrant as specified in its charter)
State or other jurisdiction of I.R.S. Employer I.D.
incorporation or organization: California Number: 95-3280412
4954 Van Nuys Boulevard
Sherman Oaks, California 91403
(Address of principal executive offices) (Zip Code)
___________________
Registrant's telephone number, including area code: (818) 986-3883
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 ___
As of November 11, 2000, 7,510,899 shares of Common Stock of the Registrant
were issued and outstanding.
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<PAGE>
INDEX
HEMACARE CORPORATION
AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated balance sheets - September 30, 2000 (unaudited) and December
31, 1999
Consolidated income statements - Three and nine months ended September 30,
2000 and 1999 (unaudited)
Consolidated statements of cash flows - Nine months ended
September 30, 2000 and 1999 (unaudited)
Notes to consolidated financial statements - September 30, 2000
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits
SIGNATURES
<PAGE>
HEMACARE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September30, December 31,
2000 1999
------------ -----------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents............................ $ 1,774,000 $ 1,490,000
Marketable securities................................ 607,000 778,000
Accounts receivable, net of allowance for
doubtful accounts - $226,000 (2000) and $256,000
(1999)............................................. 3,803,000 3,090,000
Product inventories.................................. 100,000 91,000
Supplies............................................. 632,000 690,000
Prepaid expenses..................................... 172,000 202,000
------------ ------------
Total current assets..................... 7,088,000 6,341,000
Plant and equipment, net of accumulated
depreciation and amortization of
$2,063,000 (2000) and $1,920,000 (1999).............. 765,000 719,000
Goodwill, net of amortization of $102,000 (2000) and
$62,000 (1999)....................................... 428,000 468,000
Other assets........................................... 39,000 46,000
------------ ------------
$ 8,320,000 $ 7,574,000
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable..................................... $ 1,692,000 $ 1,305,000
Accrued payroll and payroll taxes.................... 871,000 530,000
Accrued professional fees............................ 44,000 73,000
Other accrued expenses............................... 28,000 376,000
Current obligations under capital leases............. 55,000 63,000
Current notes payable................................ - 138,000
Reserve for discontinued operations.................. 77,000 81,000
------------ ------------
Total current liabilities................ 2,767,000 2,566,000
Obligations under capital leases, net
of current portion................................... 151,000 188,000
Notes payable, net of current portion.................. - 353,000
Other long-term liabilities............................ 27,000 27,000
Commitments and contingencies..........................
Shareholders' equity:
Preferred stock no par value 5,000,000 shares
authorized, 450,0000 issued and outstanding........ 75,000 75,000
Common stock, no par value - 20,000,000
shares authorized, 7,618,949 issued, 7,533,174
outstanding in 2000 and 7,475,082 issued and
oustanding in 1999.................................. 13,659,000 13,676,000
Accumulated deficit.................................. (8,359,000) (9,311,000)
------------ ------------
Total shareholders' equity............... 5,375,000 4,440,000
------------ ------------
$ 8,320,000 $ 7,574,000
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
3
<PAGE> 4
HEMACARE CORPORATION AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended Sept. 30, Nine months ended Sept. 30,
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Blood management programs.... $ 2,404,000 $ 2,032,000 $ 6,999,000 $ 5,605,000
Regional operations
Blood products............. 1,341,000 1,006,000 3,660,000 3,195,000
Blood services............. 1,632,000 1,794,000 5,063,000 5,479,000
------------- ------------ ------------- -------------
Total revenue............. 5,377,000 4,832,000 15,722,000 14,279,000
Operating costs and expenses:
Blood management programs.... 2,039,000 1,725,000 5,821,000 4,932,000
Regional operations
Blood products............. 1,087,000 748,000 2,843,000 2,301,000
Blood services............. 1,115,000 1,307,000 3,438,000 4,159,000
------------- ------------ ------------- -------------
Total operating costs and
expenses................ 4,241,000 3,780,000 12,102,000 11,392,000
------------- ------------ ------------- -------------
Gross profit............... 1,136,000 1,052,000 3,620,000 2,887,000
General and administrative
expenses..................... 819,000 771,000 2,621,000 2,244,000
Gain on sale of Gateway - - - 100,000
Community Blood Program......
------------- ------------ ------------- -------------
Income from continuing
operations before income
taxes........................ 317,000 281,000 999,000 743,000
Provision for income taxes...... 16,000 14,000 47,000 28,000
------------- ------------ ------------- -------------
Net income................... $ 301,000 $ 267,000 $ 952,000 $ 715,000
============= ============ ============= =============
Income per shares:
Basic........................ $ 0.04 $ 0.04 $ 0.13 $ 0.10
============= ============ ============= =============
Diluted...................... $ 0.03 $ 0.03 $ 0.11 $ 0.09
============= ============ ============= =============
Weighted average shares
outstanding - basic........ 7,583,699 7,437,582 7,569,356 7,359,351
============ =========== ============ =============
Weighted average shares
outstanding - diluted...... 8,859,110 8,363,532 8,892,269 8,018,390
============ =========== ============ =============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
4
<PAGE> 5
HEMACARE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine months ended Sept. 30,
2000 1999
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net Income................................................ $ 952,000 $ 715,000
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization.......................... 183,000 266,000
Issuance of common stock and options for compensation.. 75,000 65,000
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable............ (713,000) 175,000
Decrease (increase) in inventories, supplies and
prepaid xxpenses..................................... 79,000 (39,000)
(Increase) in other assets, net....................... - (3,000)
Increase (decrease) in accounts payable, accrued
expenses and other liabilities....................... 347,000 (614,000)
----------- -----------
Net cash provided by (used in) operating activities... 923,000 565,000
Cash flows from investing activities:
Decrease in other assets.................................. 7,000 14,000
Decrease (increase) in marketable securities.............. 171,000 (198,000)
Purchase of plant and equipment, net...................... (189,000) (51,000)
----------- -----------
Net cash used in investing activities..................... (11,000) (235,000)
Cash flows from financing activities:
Proceeds from issuance of common stock.................... 34,000 -
Repurchase of common stock................................ (126,000) -
Principal payments on line of credit, net and capital
leases.................................................. (536,000) (257,000)
----------- -----------
Net cash used in financing activities..................... (628,000) (257,000)
----------- -----------
Increase in cash and cash equivalents....................... 284,000 73,000
Cash and cash equivalents at beginning of period............ 1,490,000 1,372,000
----------- -----------
Cash and cash equivalents at end of period.................. $1,774,000 $1,445,000
=========== ===========
Supplemental disclosure:
Interest paid............................................. $ 21,000 $ 68,000
=========== ===========
Income taxes paid......................................... $ 110,000 $ 39,000
=========== ===========
Items not impacting cash flows:
Income in capital lease obligations....................... $ - $ 126,000
=========== ===========
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements.
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<PAGE> 6
HEMACARE CORPORATION
Notes to Consolidated Financial Statements
Note 1 - Basis of Presentation and General Information
The accompanying unaudited consolidated financial statements of HemaCare
Corporation (the "Company" or "HemaCare") have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. 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 and nine months ended September 30, 2000, are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2000. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Company's Annual
Report on For 10-K for the year ended December 31, 1999.
Note 2 - Lines of Credit
In May 2000, the Company entered into two new line of credit agreements, one
relating to working capital and the other for equipment purchases. Under the
terms of the working capital agreement, the Company may borrow the lesser of
75% of eligible accounts receivable or $2.0 million at an interest rate of
prime plus 0.25% (9.75% as of September 30, 2000). The Company must maintain
certain financial ratios and covenants. Additionally, the Company has a
secondary line of credit of $350,000 for equipment purchases. Borrowings on
the equipment purchase line of credit may be converted annually to a fully
amortized note payable. This equipment purchase line of credit bears
interest at the rate of the bank's internal cost of funds plus 3.0% (9.5% as
of September 30, 2000).
Both of these lines of credit mature on December 15, 2001. As of September 30,
2000, there were no borrowings on either of these lines of credit and the
Company was in compliance with all loan covenants.
Note 3 - Commitments and Contingencies
Since 1976, California law has prohibited the infusion of blood products into
patients if the donors of those products were paid unless, in the opinion of
the recipient's physician, blood from a non-paid donor was not immediately
available. Apheresis platelet products obtained from paid donors, including
the Company's Sherman Oaks Center's paid donors, are exempted from this law by
a series of state statutes, which, would have expired on December 31, 2001.
In February 2000, AB 2714, sponsored by the Company, was introduced in the
California Legislature. The intent of this bill was to make permanent the
provision of California law allowing payment of apheresis platelet donors.
AB 2714 was passed by the State Assembly and was submitted to the State Senate.
The State Senate required significant modifications to the bill before
passage. Rather than making the exemption permanent, the Senate extended the
current exemption for one additional year. The modified bill was enacted
into law on September 7, 2000. Unless a new exemption is obtained, the
existing exemption will expire under its sunset provision on December 31,
2002, which could have a material adverse effect on the Company's revenue and
net income.
State and Federal laws set forth antikickback and self-referral prohibitions
and otherwise regulate financial relationships between blood banks and
hospitals, physicians and other persons who refer business to them. While
the Company
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<PAGE> 7
believes its present operations comply with applicable regulations, there can
be no assurance that future legislation or rule making, or the interpretation
of existing laws and regulations will not prohibit or adversely impact the
delivery by HemaCare of its services and products.
Note 4 - Common Stock
On July 5, 2000, the Company announced its intention to repurchase up to 15% of
its outstanding shares, or up to 1.1 million shares. The Company repurchases
these shares from time to time in open market and private transactions depend-
ing on price and availability. As of September 30, 2000, the Company
repurchased 85,000 shares at an average cost per share of $1.48.
Note 5 Business Segments
The Company operates in three business segments, each of which represents a
separate business activity. The segments and a description of their business
activities follows:
- Blood Management Programs (BMP) - outsource programs that provide all or a
major portion of the blood related functions to a hospital.
- Blood Products - the collection, manufacture and distribution of apheresis
and whole blood derived products.
- Blood Services - therapeutic apheresis and stem cell collection procedures,
autologous interoperative transfusion and donor testing.
Management uses more than one measure to evaluate segment performance. How-
ever, the dominant measurements are consistent with the Company's consoli-
dated financial statements, which present revenue from external customers
and operating income for each segment.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
HemaCare's operations include blood management programs ("Blood Management
Programs" or "BMPs") and regional sales of blood products ("Blood Products")
and blood services ("Blood Services").
A Blood Management Program allows a hospital to outsource all or a portion of
its blood procurement and donor center management operations and other blood
related activities.
Blood Products include apheresis platelets and whole blood components such as
red blood cells and plasma products. Blood Services include therapeutic
apheresis procedures, stem cell collection, interoperative autologous
transfusion and donor testing.
In February 2000, the Company commenced a Blood Management Program with
Long Beach Memorial Medical Center ("LBMMC") and in May 2000 opened a
Blood Management Program with Presbyterian Intercommunity Hospital
("PIH"). The Company now operates eight blood management programs. In
addition to these new programs opened in year 2000, the Company operates
programs at the University of Southern California ("USC"), the University
of California at Irvine ("UCI"), Dartmouth-Hitchcock Medical Center
("DHMC"), Maine Medical Center ("MMC"), St. Vincent Hospital ("St. Vincent")
and University of North Carolina ("UNC").
7
<PAGE> 8
All comparisons within the following discussions are to the comparable
periods of the previous year.
Three-months ended September 30, 2000 compared to the three-months ended
September 30, 1999
Revenues and Gross Profit Overview
----------------------------------
Revenue for the three-months ended September 30, 2000 was $5,377,000
compared to $4,832,000 for the three-months ended September 30, 1999.
The increase of $545,000 (11%) was primarily due to the expansion of the
California based BMPs and more Blood Product sales partially offset by lower
Blood Service revenue. Gross profit as a percentage of revenue declined
from 22% in 1999 to 21% in 2000. The decrease in profit margins reflects
higher costs associated with Blood Products and continuing price competition,
partially offset by increased margins on Blood Services.
Blood Management Programs
-------------------------
Revenues for the three-months ended September 30, 2000 were $2,404,000
compared to $2,032,000 for the three-months ended September 30, 1999.
The increase of $372,000 (18%) was primarily attributed to the addition
of two new California based BMPs. The LBMMC BMP opened in February 2000
and the PIH BMP opened in May 2000. Revenues at the Company's existing
BMPs were consistent with the same period in the prior year.
The gross profit from BMPs for the three months ended September 30, 2000,
was $365,000 compared to $307,000 in the same period. The gross profit
margin for both periods was 15%. The gross profit increase of $58,000
represents improved margins at existing BMPs offset by certain start-up
losses at PIH. The PIH losses reflect an investment to develop a larger
donor base. All other BMPs remain profitable.
Blood Products
--------------
Revenue for the three-months ended September 30, 2000, was $1,341,000
compared to $1,006,000 for the three-months ended September 30, 1999.
The increase of $335,000 (33%) reflects additional platelet sales to
new customers offset by a lower price per unit. Price competition
(primarily from the American Red Cross) remains intense.
The gross profit percentage was 19% for the three months ended September
30, 2000, compared to 26% during the three months ended September
30, 1999. The decrease reflects lower pricing per unit due to the
above described price competition. The Company recently adopted new
standards governing platelet donations. These new standards result in
better product consistency but reduce the average number of saleable
products obtained per donation. Additionally, the Company experienced
a greater number of product expirations during the quarter ended
September 30, 2000, compared to the same period in the prior year.
Blood Services
--------------
Blood services revenue for the three-months ended September 30, 2000,
was $1,632,000 compared to $1,794,000 for the three-months ended
September 30, 1999. The decrease of $162,000 (9%) reflects a decrease
in demand for therapeutic apheresis services in New England. Competition
with other therapeutic apheresis providers in this region intensified
during the quarter. The Company often provides albumin, a plasma
replacement fluid, used in therapeutic procedures. The Company's cost
of albumin and the price the Company charges its customers decreased
in the three-months ended September 30, 2000, compared to the same
period in 1999. Revenues from other regions were consistent with
the prior year.
8
<PAGE> 9
The gross profit from Blood Services was 32% for the three-months
ended September 30, 2000, compared to 27% in the same period of 1999.
The improvement in gross profit margin percentage is a result of better
cost controls and efficiencies and the changes in the mix of sales from
various regions. The cost controls and efficiencies resulted from better
labor utilization thereby reducing overtime and associated payroll expenses.
General and administrative expenses
-----------------------------------
General and administrative expenses were $819,000 for the three-months
ended September 30, 2000 compared to $771,000 for the three months ended
September 30, 1999. The increase of $48,000 (6%) reflects additional
expenses in connection with the Company's sponorship of the California
legislative initiative (AB2714) (See Liquidity and Capital Resources) and
increased marketing efforts.
Comparison of the Nine-Months Ended September 30, 2000 to the Nine-Months
Ended September 30, 1999
Revenue and gross profit overview
---------------------------------
Revenues for the nine-months ended September 30, 2000, were $15,722,000
compared to $14,279,000 during the three-months ended September 30, 1999.
The increase of $1,443,000 (10%) was primarily due to expansion of the
California based BMPs and greater sales of blood products partially
offset by a decline in the demand for blood services. Gross profit
as a percentage of revenue was 23% for the nine-months ended September
30, 2000, compared to 20% in the same period in the prior year. The
increase reflects continued improvement in the BMPs and blood services
partially offset by higher cost of sales in blood products.
Blood Management Programs
-------------------------
Revenues for the nine-months ended September 30, 2000, were
$6,999,000 compared to $5,605,000 during the nine-months ended September
30, 1999. The increase of $1,394,000 (25%) was primarily due to the
expansion of the California based BMPs. The LBMMC BMP opened in February
2000 and the PIH BMP opened in May 2000. Additionally, revenues for the
nine-months ended September 30, 2000, includes nine months of revenue from
the UCI BMP. This BMP opened in June 1999. Revenue from the Company's
other BMPs was consistent with the same period in the prior year.
The gross profit margin from BMP was 17% for the nine-months ended
September 30, 2000 compared to 12% in the same period of 1999. The
increase reflects increased product collections and operating
efficiencies and changes in the mix of products and services provided
to BMP customers. All of the Company's BMPs were profitable except the
PIH BMP that incurred certain start-up expenses.
Blood Products
--------------
Blood products revenue for the nine-months ended September 30, 2000,
was $3,660,000 compared to $3,195,000 for the nine-months ended
September 30, 1999. The increase of $465,000 (15%) reflects
additional sales to new customers offset by a lower price per unit.
Price competition (primarily from the American Red Cross) remains intense.
The gross profit margin from blood products was 22% for the nine-months
ended September 30,2000 compared to 28% in the same period in the prior
year. The decrease reflects lower prices per unit due to the above
described price competition. During the nine-months ended September
30, 2000, the Company adopted new standards governing platelet donations.
These new standards result in better product consistency but reduce the
average number of saleable products obtained per donation. This
difference in donor yield negatively impacted the gross profit for the
nine-months ended September 30, 2000.
9
<PAGE> 10
Blood Services
--------------
Blood services revenue for the nine-months ended September 30, 2000,
was $5,063,000 compared to $5,479,000 for the nine-months ended September
30, 1999. The decrease of $416,000 (8%) was primarily due to a decrease
in demand for therapeutic apheresis procedures in New England partially
offset by an increase in demand for services in New York. Additionally,
the Company's cost of albumin and the price the Company charges its
customers, decreased in the nine-months ended September 30, 2000. Demand
for services in other regions was consistent between periods.
The gross margin from blood services was 32% for the nine-months ended
September 30, 2000, compared to 24% in the same period last year. The
improvement in gross profit margin percentage is a result of better cost
controls and efficiencies and the changes in the mix of sales from
various regions. The cost controls and efficiencies resulted from better
labor utilization thereby reducing overtime and associated payroll
expenses. Profit margins tend to be less in New England than in other
regions. Therefore, while the reduction in demand for blood services in
New England reduces the Company's overall gross profit dollars, it also
increases the Company's gross profit margin. Additionally, the Company
has emphasized better personnel utilization thereby reducing overtime,
especially in the New York region.
General and administrative expenses
-----------------------------------
General and administrative expenses were $2,621,000 for the nine-months
ended September 30, 2000, compared to $2,244,000 for the nine-months ended
September 30,1999. The increase of $377,000 (17%) reflects additional
expenses incurred in connection with the Company's sponsorship of the
California legislative initiative (AB2714) (See Liquidity and Capital
Resources) and expanded marketing efforts.
Liquidity and Capital Resources
-------------------------------
At September 30, 2000, the Company had cash and cash equivalents and
marketable securities of $2,381,000 and working capital of $4,321,000.
During the second quarter of 2000, the Company paid off its term note
payable with a remaining balance of $457,000 using its cash and
marketable securities. Since the interest rate on the term note payable
exceeded the average interest rate of the Company's marketable securities,
paying off the note should reduce future net interest expense.
The Company has two lines of credit with a commercial bank. The first
line of credit is a working capital line with an availability equal
to the lesser of 75% of eligible accounts receivable or $2.0 million.
Interest is payable monthly at a rate of prime plus 0.25% (9.75%
as of September 30, 2000). The second line of credit provides $350,000
for equipment purchases. On an annual basis, the Company may convert its
equipment purchases into a long-term, fully amortized note payable. The
note requires monthly payments including interest equal to the Bank's
internal cost of funds plus 3% (9.5% as of September 30, 2000). These
lines of credit are secured by substantially all of the Company's
unencumbered assets and require the Company to maintain certain financial
covenants. As of September 30, 2000, the Company was in compliance with
these covenants and there were no borrowings on these lines. These
lines of credit mature on December 15, 2001.
During the second quarter of 2000, the Company experienced an increase
in its accounts receivable balances as certain customers delayed payments.
As of December 31, 1999, accounts receivable were collected in an average
of 59 days. As of June 30, 2000,
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<PAGE> 11
accounts receivable were collected in an average of 71 days. In response
to the slowdown in collections the Company instituted certain procedures.
These procedures include requiring stricter adherence to the Company's
credit terms; lowering the credit limits to slow paying customers and more
frequent customer contact. As a result of these efforts days sales
outstanding was reduced during the third quarter 2000, to 65 days.
The Company will continue its adherence to these new procedures.
In July 2000, the Company announced its intention to repurchase up to 15%
of its outstanding common stock, or up to 1.1 million shares. Purchases
are made in the open market or in private transactions depending on price
and availability. The Company is funding the purchases from its cash
and cash equivalents and marketable securities along with profits
generated in the normal course of business. As of September 30, 2000,
the Company repurchased 85,000 shares at an average price of $1.48 per
share.
In February 2000, AB 2714, sponsored by the Company, was introduced in
the California Legislature. The intent of this bill was to make permanent
the provision of California law allowing payment of apheresis platelet
donors. AB 2714 was overwhelmingly passed by the State Assembly and was
submitted to the State Senate. The State Senate required significant
modifications to the bill before passage. Rather than making the exemption
permanent, the Senate extended the current exemption for one additional year.
The modified bill was enacted into law on September 7, 2000. Unless a
new exemption is obtained, the existing exemption will expire under its
sunset provision on December 31, 2002, which could have a material adverse
effect on the Company's revenue and net income.
Year 2000 Disclosure
---------------------
To date, the Company has not experienced any major systems failures or
other adverse consequences due to Year 2000 noncompliance. While the
possibility still exists for further computer failures, internally or
among its customers and suppliers, management does not expect that
these developments, should they occur, would have a material adverse
impact on the financial position, results of operation or cash flows
of the Company.
Factors Affecting Forward-Looking Information
---------------------------------------------
The Private Securities Litigation Reform Act of 1995 provides a
"safe harbor" from liability for forward-looking statements. Certain
information included in the Form 10-Q and other materials filed or
to be filed by the Company with the Securities and Exchange
Commission (as well as information included in oral statements or other
written statements made or to be made by or on behalf of the Company)
are forward-looking, such as statements relating to operational and
financing plans, competition, the effects of discontinued operations,
the effect of state and Federal regulation and demand for the Company's
products and services. Such forward-looking statements involve
important risks and uncertainties, many of which will be beyond
the control of the Company. These risks and uncertainties could
significantly affect anticipated results in the future, both
short-term and long-term, and accordingly, such results may differ
from those expressed in forward-looking statements made by or on behalf
of the Company. These risks and uncertainties include, but are not
limited to, the Company's ability to use paid apheresis platelet
donors in California beyond December 31, 2002, the ability of the
Company to expand its operations, to obtain additional financing, to
repay existing debt, to retain existing customers and obtain new
customers and to comply with the covenants under its bank line of
credit. Each of these risks and uncertainties as well as others
are discussed in greater detail in the preceding paragraphs of
this Management's Discussion and Analysis of Financial Condition and
Results of Operations and in the Company's Annual Report on Form
10-K for the year ended December 31, 1999.
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<PAGE> 12
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
See disclosure in Form 10-K for the year ended December 31,
1999.
Item 2. Changes in Securities and Use of Proceeds - 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
a. Exhibits
10 Employment agreement between the Registrant and
William D. Nicely dated June 1, 2000
11 Net Income per Common and Common Equivalent Share
27 Financial Data Schedule for the Quarter Ended September
30, 2000
b. The Company did not file any reports on Form 8-K during
the three months ended September 30, 2000.
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.
Date November 14, 2000 HEMACARE CORPORATION
-------------------- ------------------------------
(Registrant)
/s/ David E. Fractor
------------------------------
David E. Fractor, Chief
Financial Officer
(Duly authorized officer and
principal financial and
accounting officer)
12
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14
