===============================================================================
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 June 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 August 11, 2000, 7,618,949 shares of Common Stock of the Registrant were
issued and outstanding.
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<PAGE>
INDEX
HEMACARE CORPORATION
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated balance sheets-June 30, 2000 (unaudited) and December 31, 1999
Consolidated income statements-Three and six months ended June 30, 2000
and 1999 (unaudited)
Consolidated statements of cash flows-Six months ended June 30, 2000 and
1999 (unaudited)
Notes to consolidated financial statements-June 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 4. Submission of Matters to a Vote of Security Holders
Item 6. Exhibits
SIGNATURES
<PAGE> 3
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<PAGE> 3
HEMACARE CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
------------ -----------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents............................ $ 509,000 $ 1,490,000
Marketable securities................................ 982,000 778,000
Accounts receivable, net of allowance for
doubtful accounts - $226,000 (2000) and $256,000
(1999)............................................. 4,042,000 3,090,000
Product inventories.................................. 92,000 91,000
Supplies............................................. 673,000 690,000
Prepaid expenses..................................... 193,000 202,000
------------ ------------
Total current assets..................... 6,491,000 6,341,000
Plant and equipment, net of accumulated
depreciation and amortization of
$2,017,000 (2000) and $1,920,000 (1999).............. 782,000 719,000
Goodwill, net of amortization of $88,000 (2000) and
$62,000 (1999)....................................... 442,000 468,000
Other assets........................................... 42,000 46,000
------------ ------------
$ 7,757,000 $ 7,574,000
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable..................................... $ 1,489,000 $ 1,305,000
Accrued payroll and payroll taxes.................... 531,000 530,000
Accrued professional fees............................ 53,000 73,000
Other accrued expenses............................... 158,000 376,000
Current obligations under capital leases............. 58,000 63,000
Current notes payable................................ - 138,000
Reserve for discontinued operations.................. 78,000 81,000
------------ ------------
Total current liabilities................ 2,367,000 2,566,000
Obligations under capital leases, net
of current portion................................... 163,000 188,000
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 and
outstanding in 2000 and 7,475,082 in 1999........... 13,785,000 13,676,000
Accumulated deficit.................................. (8,660,000) (9,311,000)
------------ ------------
Total shareholders' equity............... 5,200,000 4,440,000
------------ ------------
$ 7,757,000 $ 7,574,000
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
3
<PAGE> 4
HEMACARE CORPORATION
CONSOLIDATED INCOME STATEMENTS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Blood management programs.... $ 2,342,000 $ 2,035,000 $ 4,595,000 $ 3,573,000
Regional operations
Blood products............. 1,280,000 1,122,000 2,319,000 2,189,000
Blood services............. 1,751,000 1,837,000 3,431,000 3,685,000
------------- ------------ ------------- -------------
Total revenue............. 5,373,000 4,994,000 10,345,000 9,447,000
Operating costs and expenses:
Blood management programs.... $ 1,962,000 $ 1,747,000 $ 3,782,000 $ 3,207,000
Regional operations
Blood products............. 968,000 816,000 1,756,000 1,553,000
Blood services............. 1,190,000 1,430,000 2,323,000 2,852,000
------------- ------------ ------------- -------------
Total operating costs and
expenses................ 4,120,000 3,993,000 7,861,000 7,612,000
------------- ------------ ------------- -------------
Gross profit............... 1,253,000 1,001,000 2,484,000 1,835,000
General and administrative
expenses..................... 911,000 791,000 1,802,000 1,477,000
Gain on sale of Gateway - - - 100,000
Community Blood Program......
------------- ------------ ------------- -------------
Income from continuing
operations before income
taxes........................ 342,000 210,000 682,000 458,000
Provision for income taxes...... 16,000 9,000 31,000 14,000
------------- ------------ ------------- -------------
Net income................... $ 326,000 $ 201,000 $ 651,000 $ 444,000
============= ============ ============= =============
Income per shares:
Basic........................ $ 0.04 $ 0.03 $ 0.09 $ 0.06
============= ============ ============= =============
Diluted...................... $ 0.04 $ 0.02 $ 0.07 $ 0.06
============= ============ ============= =============
Weighted average shares
outstanding - basic........ 7,625,054 7,392,238 7,561,490 7,336,679
============ =========== ============ =============
Weighted average shares
outstanding - diluted...... 8,904,825 8,382,023 8,905,359 7,924,092
============= ============ ============= =============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
4
<PAGE> 5
HEMACARE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended June 30,
2000 1999
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net Income................................................ $ 651,000 $ 444,000
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization......................... 123,000 146,000
Issuance of common stock and options for compensation. 75,000 65,000
Changes in operating assets and liabilities:
(Increase) in accounts receivable..................... (952,000) (72,000)
Decrease in inventories, supplies and prepaid
expenses............................................. 25,000 13,000
(Increase) in other assets, net....................... - (1,000)
(Decrease) in accounts payable, accrued expenses and
other liabilities.................................... (56,000) (633,000)
----------- -----------
Net cash provided by operating activities............. (134,000) (38,000)
Cash flows from investing activities:
Decrease in other assets.................................. 4,000 10,000
(Increase) in marketable securities....................... (204,000) (288,000)
(Purchase) of plant and equipment, net.................... (160,000) (19,000)
----------- -----------
Net cash used in investing activities..................... (360,000) (297,000)
Cash flows from financing activities:
Proceeds from issuance of common stock.................... 34,000 -
Principal payments on line of credit, net and capital
leases.................................................. (521,000) (171,000)
----------- -----------
Net cash used in financing activities..................... (487,000) (171,000)
----------- -----------
Decrease in cash and cash equivalents....................... (981,000) (506,000)
Cash and cash equivalents at beginning of period............ 1,490,000 1,372,000
----------- -----------
Cash and cash equivalents at end of period.................. $ 509,000 $ 866,000
=========== ===========
Supplemental disclosure:
Interest paid............................................. $ 20,000 $ 45,000
=========== ===========
Income taxes paid......................................... $ 36,000 $ 18,000
=========== ===========
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
5
<PAGE>
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 six months
ended June 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 Form 10-K for the
year ended December 31, 1999.
Note 2 - Lines of Credit
------------------------
During the quarter ended June 30, 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 June 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% (9.9% as of June 30, 2000).
Both of these lines of credit mature on December 15, 2001.
As of June 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 the latest of which passed in late 1994. Unless a
new exemption is obtained, the existing exemption will
expire under its sunset provision of December 31, 2001,
which could have a material adverse effect on the Company's
revenue and net income.
In February 2000, AB 2714 was introduced into the Calfornia
Legislature. The original intent of this bill was to make
permanent the current provisions of California law allowing
payments to apheresis platelet donors. The California Assembly
approved AB 2714. However, in order to obtain approval from the
California Senate Health Committee, certain modifications were
made to the bill. Instead of repeal of the law prohibiting
payments to apheresis platelet donors, the modified bill
will extend the current exemption through January 1, 2003.
The modified bill was approved by the California Senate Health
Committee and will be voted on by the entire California Senate.
Assuming passage by the California Senate, the bill will then
be presented to the Governor for final approval. While the
Company is confident that this amended bill will be enacted
into law, there are no assurances of its ultimate passage.
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 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 - 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. However, the dominant measurements are
consistent with the Company's consolidated 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 HemaCare 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 autologus transfusion and donor testing.
In October 1998, the Company, through its subsidiary Coral Blood Services,
Inc. ("CBS"), acquired existing blood products and services operations in the
eastern United States. These consist of Blood Management Programs and other
blood services provided to hospitals and medical centers.
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
programs, the Company operates programs at the University of Southern Calif-
ornia ("USC"), initiated in 1996, the University of California at Irvine
("UCI"), initiated in June 1999, and four East Coast programs. The East
Coast programs are Dartmouth-Hitchcock Medical Center ("DHMC"), Maine
Medical Center ("MMC"), St. Vincent Hospital ("St. Vincent") and University
of North Carolina ("UNC"). Prior to October 1998, Coral Therapeutics, Inc.
operated these programs.
All comparisons within the following discussions are to the comparable periods
of the previous year.
Revenues and Operating Profit
------------------------------
Three-months ended June 30, 2000 compared to the three-months ended June 30,
1999
Revenues and Gross Profit
-------------------------
Revenues for the three-months ended June 30, 2000, increased by 8% ($379,000)
over the same period in 1999. The revenue increase was primarily due to the
expansion of the California based BMPs and increased revenue at existing
BMPs, partially offset by lower Blood Service revenue. Gross profit as a
percentage of revenue was 23% in the three-months ended June 30, 2000,
compared to 20% in the three-months ended June 30, 1999. The increase
reflects continued improvement in the Company's operating efficiency.
Blood Management Programs
-------------------------
Revenues for the three-months ended June 30, 2000, were $2,342,000 as compared
to $2,035,000 for the three months ended June 30, 1999. The increase of
$307,000 (15%) was primarily due to the addition of two new California 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 BMP revenues was 16% for the three-months ended June 30,
2000, compared to 14% in the same period of 1999. The increase is attributed
to increased blood product collections without a significant increase in
operating expenses at the Company's existing BMPs. The UCI and LBMMC BMPs were
profitable during the second quarter while the PIH BMP experienced a loss as
it incurred certain start-up expenses. These expenses included additional
labor to develop procedures and recruit donors.
Blood Products
---------------
Revenues for the three-months ended June 30, 2000 were $1,280,000 compared to
$1,122,000 for the three-months ended June 30, 1999. The increase of $158,000
(14%) reflects additional platelet sales to new customers partially offset by
a lower price per unit.
The gross profit from blood products was 24% for the three-months ended June
30, 2000, compared to 27% in the same period of 1999. The decrease is due to
a continuation of the price competition in California (primarily from the
American Red Cross) resulting in lower prices. Additionally, the Company
experienced a greater number of product expirations during the three-months
ended June 30, 2000.
Blood Services
--------------
Blood services revenue for the three-months ended June 30, 2000 was $1,751,000
compared to $1,837,000 for the three-months ended June 30, 1999. The decrease
of $86,000 (5%) was primarily due to a decrease in demand for therapeutic
apheresis services in New England. 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 June 30, 2000 compared to the same period in 1999.
Revenues from other regions were consistent with the prior year.
The gross profit from blood services was 32% for the three-months ended June
30, 2000 compared to 22% in the same period of 1999. The increase in profit
margins reflects better operating efficiencies in all regions. These
efficiencies include better utilization of personnel, thereby reducing
overtime, and reduced overhead as a percentage of total blood service revenue.
General and administrative expenses
-----------------------------------
General and administrative expenses were $911,000 for the three-months ended
June 30, 2000 compared to $791,000 for the three-months ended June 30, 1999.
The increase of $120,000 (15%) reflects additional expenses incurred in
connection with the proposed California legislation (AB2714) (See Liquidity
and Capital Resources below), expanded marketing efforts and the accrual of
employee incentive compensation related to improved operating performance.
Comparison of the Six-Months Ended June 30, 2000 to the Six-Months Ended June
30, 1999
Revenues and gross profits
--------------------------
Revenues for the six-months ended June 30, 2000, increased by 10% ($898,000)
over the same period in 1999. The revenue increase was primarily due to the
expansion of the California based BMPs and increased revenue at existing BMPs.
This revenue growth was partially offset by lower Blood Service Revenue.
Gross profit as a percentage of revenue was 24% for the six-months ended June
30, 2000, compared to 19% in the same period of 1999. The increase in gross
profit percentage reflects continued improvement in the Company's operating
efficiency particularly in the Company's blood services segment.
Blood Management Programs
-------------------------
Revenues for the six-months ended June 30, 2000, were $4,595,000 as compared
to $3,573,000 for the six-months ended June 30, 1999. The increase of
$1,022,000 (29%) was primarily due to the expansion of California based BMPs.
The LBMMC BMP opened in February 2000 and the PIH BMP opened in May 2000.
Additionally, revenues for the six-months ended June 30, 2000, include six
months of revenue from the UCI BMP. This BMP opened in June 1999; therefore,
only one month of revenue was reflected in revenues for the six-months ended
June 30, 1999. Revenue from the Company's other BMPs was consistent with the
same period of the prior year.
The gross margin from BMP revenues was 18% for the six-months ended June 30,
2000 compared to 10% in the same period of 1999. The increase is primarily
due to increased blood product collections without a corresponding increase
in operating costs. All of the Company's BMPs were profitable except the PIH
BMP that incurred start-up expenses.
Blood Products
--------------
Blood products revenue for the six-months ended June 30, 2000 was $2,319,000
compared to $2,189,000 for the six-months ended June 30, 1999. The increase
of $130,000 (6%) reflects additional platelet sales to new customers offset by
a lower price per unit.
The gross profit margin from blood products was 24% for the six-months ended
June 30, 2000 compared to 29% in the same period of 1999. The decrease
reflects the continuation of competitive pressures (primarily from the
American Red Cross) resulting in decreased platelet prices.
Blood Services
---------------
Blood services revenue for the six-months ended June 30, 2000 was $3,431,000
compared to $3,685,000 for the six-months ended June 30, 1999. The decrease
of $254,000 (7%) was primarily due to a decrease in demand for therapeutic
apheresis services 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 six-months ended June
30, 2000 compared to the same period in 1999.
The gross margin from blood services was 32% for the six-months ended June 30,
2000 compared to 23% in the same period of 1999. The increase reflects
continued improvement in operating efficiencies. These efficiencies include
better utilization of personnel, thereby reducing overtime, and reduced
overhead as a percentage of total blood service revenue.
General and administrative expenses
------------------------------------
General and administrative expenses were $1,802,000 for the six-months ended
June 30, 2000 compared to $1,477,000 for the six-months ended June 30, 1999.
The increase of $325,000 (22%) reflects additional expenses incurred in
connection with the proposed California legislation (AB2714) (See Liquidity
and Capital Resources below), expanded marketing efforts and the accrual of
employee incentive compensation related to improved operating performance.
Liquidity and Capital Resources
--------------------------------
At June 30, 2000, the Company had cash and cash equivalents and marketable
securities of $1,491,000 and working capital of $4,124,000. 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
on the Company's marketable securities, paying off the note should reduce
future interest expense net of interest income.
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 (9.5% as of June 30, 2000) plus 0.25%. 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 funs (6.9% as of June 30, 2000) plus 3%.
These lines of credit are secured by substantially all of the Company's
unencumbered assts and require the Company to maintain certain financial
covenants. As of June 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, accounts receivable were collected in an average
of 71 days. The Company has instituted certain procedures to accelerate
collections. These procedures include requiring stricter adherence to the
Company's credit terms; lowering credit limits to slow paying customers and
more frequent customer contact. The Company believes that these procedures
should improve the collection of its accounts receivable.
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. Such purchases
will be made in the open market or in private transactions depending on price
and availability. Cash used for the purchases will come from the Company's
cash and cash equivalents and marketable securities along with profits
generated in the normal course of business.
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 the latest of which passed in late 1994. Unless a
new exemption is obtained, the existing exemption will expire under its sunset
provision of December 31, 2001, which could have a material adverse effect on
the Company's revenue and net income.
In February 2000, AB 2714 was introduced into the California Legislature. The
original intent of this bill was to make permanent the current provisions of
California law allowing payments to apheresis platelet donors. The California
Asseembly approved AB 2714. However, in order to obtain approval from the
California Senate Health Committee, certain modifications were made to the
bill. Instead of repeal of the law prohibiting payments to apheresis platelet
donors, the modified bill will extend the current exemption through January 1,
2003. The modified bill was approved by the California Senate Health Committee
and will be voted on by the entire California Senate. Assuming passage by the
California Senate, the bill will then be presented to the Governor for final
approval. While the Company is confident that this amended bill will be enacted
into law, there are no assurances of its ultimate passage.
The Company anticipates that cash flow from profitable operations, borrowing
available from its bank line of credit and its cash and investments on hand
will be sufficient to provide funding for its existing needs during the next
twelve months.
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, those relating to the passage of AB 2714 in
California to permit continuation of the Company's use of paid apheresis
platelet donors in California, 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.
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
See disclosure in Form 10-K for the year ended December
31, 1999.
Item 4. Submission of Matters to a Vote of Security Holders
a The Company's Annual Meeting of Shareholders the
"Meeting") was held on June 15, 2000.
b. The following table shows the tabulation of votes
for all matters put to vote at the Meeting.
<TABLE>
<CAPTION>
Matters Put to Vote Against/ Broker
For Withheld Abstain Non-Votes
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Election of Five Directors
Alan C. Darlington......... 6,142,960 32,597
Charles R. Schwab, Jr...... 6,142,960 32,597
Julian L. Steffenhagen..... 6,143,135 32,422
William D. Nicely.......... 6,142,960 32,597
Robert L. Johnson.......... 6,143,135 32,422
<PAGE>
2. Proposal to amend the
Company's 1996 Stock
Incentive Plan to
increase from 1,400,000
to 2,000,000 the number
of shares of Common
Stock authorized and
reserved for issuance
under the Plan........... 2,886,386 123,398 12,775 3,152,998
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
---------------------------------------------
a. Exhibits
11 Net Income per Common and Common Equivalent Share
27 Financial Data Schedule for the Quarter Ended June 30, 2000
b. The Company did not file any reports on Form 8-K
during the three months ended June 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 August 14, 2000 HEMACARE CORPORATION
------------------ -------------------------
(Registrant)
/s/ David E. Fractor
--------------------------
David E. Fractor, Chief
Financial Officer
(Duly authorized officer
and principal financial and
accounting officer)
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Method of Filing
-------------------------------------------------------------- ------------------------
<S> <C>
11 Net Income per Common and Common Equivalent Share............ Filed herewith electronically
27 Financial Data Schedule for the quarter ended
June 30, 2000................................................ Filed herewith electronically
</TABLE>
