<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-QSB
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
SECURITIES EXCHANGE ACT OF 1934
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1997
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Commission file number 0-17714
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BIOPOOL INTERNATIONAL, INC.
(Exact name of Registrant as specified in its charter)
Delaware 58-1729436
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6025 Nicolle Street, Ventura, (805) 654-0643
California 93003 (Registrant's telephone
(Address of principal executive offices) number including
area code)
-------------------------------------
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 proceeding 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 / /
Indicate the number of shares outstanding of each of the issuer's
classes of Common Stock, as of the latest practicable date.
Outstanding at March 31, 1997, Common Stock, $.01 par value per share,
8,579,269 shares.
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
BIOPOOL INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
MARCH 31, DECEMBER 31,
1997 1996
(Unaudited)
- -----------------------------------------------------------------------
(in thousands except share data)
<S> <C> <C>
ASSETS
Current assets
Cash $ 938 $ 2,019
Accounts receivable, net 2,844 1,560
Inventories 3,948 2,027
Prepaid expenses and other current
assets 286 289
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Total current assets 8,016 5,895
Property and equipment 8,113 3,661
Less accumulated depreciation (3,811) (2,018)
- -----------------------------------------------------------------------
Property and equipment, net 4,302 1,643
Deposit on acquisition 4,500
Other Assets 1,162 1,085
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TOTAL ASSETS $13,480 $13,123
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</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
BIOPOOL INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
MARCH 31, DECEMBER 31,
1997 1996
(Unaudited)
- -----------------------------------------------------------------------
(in thousands except share data)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and other payables $ 1,402 $ 988
Debt 982 972
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Total current liabilities 2,384 1,960
Long-term debt, net 2,579 2,811
Stockholders' equity:
Common stock, $.01 par value, 50,000,000
shares authorized; 8,579,269 and
8,570,380 shares issued and outstanding
in 1997 and 1996, respectively 86 86
Other stockholders' equity 8,431 8,266
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Total stockholders' equity 8,517 8,352
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $13,480 $13,123
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</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
BIOPOOL INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
THREE MONTHS ENDING MARCH 31, 1997 1996
- -----------------------------------------------------------------------
(in thousands except share data)
<S> <C> <C>
Sales $ 4,103 $ 1,778
Costs and expenses
Cost of sales 2,485 903
Selling, general, administrative and other 1,133 567
Interest expense 88 19
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Income before taxes 397 289
Income tax (expense) benefit (87) 11
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Net income $ 310 $ 300
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Net income per share:
Primary $ 0.03 $ 0.04
Fully diluted $ 0.03 $ 0.04
</TABLE>
<TABLE>
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
THREE MONTHS ENDING MARCH 31, 1997 1996
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(in thousands)
<S> <C> <C>
Operating activities $ (422) $ 71
Investing activities
Acquisition of BCA (4,700)
Other 4,406 (63)
Financing activities (211) (4)
Effect of exchange rates (156) (2)
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Net increase (decrease) in cash $ (1,083) $ 2
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</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
BIOPOOL INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
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 Article 10 of Regulation S-X. 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 a fair presentation have been
included. Operating results for the three month period ended March 31,
1997 is not necessarily indicative of the results that may be expected
for the year ended December 31, 1997. For further information, refer
to the consolidated financial statements and footnotes thereto included
in the Company's annual report on Form 10-KSB for the year ended
December 31, 1996.
The balance sheet at December 31, 1996 has been derived from the
audited financial statements at that date but does not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements.
<TABLE>
<CAPTION>
2. Inventories March 31, December 31,
1997 1996
(in thousands)
-----------------------
<S> <C> <C> <C>
Raw materials $ 1,104 $ 448
Work in process 1,507 700
Finished products 1,337 879
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$ 3,948 $ 2,027
</TABLE>
3. Acquisition
On January 1, 1997, the Company acquired certain assets of the
Blood Group Serology Division of Organon Teknika Corporation
located in West Chester, Pennsylvania, for $4,500,000 in cash.
Another $200,000 of costs associated with the acquisition were
capitalized in the first quarter of 1997. The Company funded the
acquisition, in part, from the privately placed sales of 500,000
shares of its Common Stock to a group of accredited investors and,
in part, from the proceeds of a $3.5 million credit facility. The
acquisition was accounted for as a purchase.
<PAGE>
<TABLE>
The following unaudited data was prepared for analytical purposes
only. Proforma consolidated operating results give effect as if
the acquisition occurred January 1, 1996.
<CAPTION>
Three Months Ended March 31,
1997 1996
(in thousands except share data)
-----------------------
<S> <C> <C>
Net sales $ 4,103 $ 3,768
Net income 310 363
Earnings per share 0.03 0.04
</TABLE>
4. Earnings per Share
In February 1997, the Financial Accounting Standards Board issued
Statement No. 128, Earnings per Share, which is required to be
adopted on December 31, 1997. At that time, the Company will be
required to change the method currently used to compute earnings
per share and to restate all prior periods. Under the new
requirements for calculating primary earnings per share, the
dilutive effect of stock options will be excluded. The impact is
expected to result in an increase in primary earnings per share
for the first quarter ended March 31, 1997 of $0.01 per share,
with no change to the 1996 period. The impact of Statement 128
on the calculation of fully diluted earnings per share for these
quarters is not expected to be material.
<PAGE>
BIOPOOL INTERNATIONAL, INC.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Acquisition of Blood Group Serology
On January 1, 1997, the Company purchased certain assets of the Blood
Group Serology Division (referred to as "BCA") of Organon Teknika
Corporation for $4,500,000 in cash. It is anticipated that this
acquisition will approximately double the size of the Company in terms
of the number of employees, sales, and operating activities.
Results of Operations
Sales increased by $2.3 million, or 130%, to $4.1 million for the
period ended March 31, 1997, compared with the corresponding period of
1996. While the majority of the increase was due to the acquisition of
BCA, the core hemostasis business grew approximately 15% over the same
period as a result of the addition of a direct sales force and new
distribution agreements.
Costs of sales, as a percentage of sales, increased to 61% in 1997
compared with 51% in the same 1996 period. This increase is due
entirely to the acquisition of BCA, which has excess capacity at this
time. Management anticipates to capitalize on this opportunity by
growing market share of existing products and adding new, profitable
product lines.
Selling, general, administrative and other expenses in the first
quarter of 1997 doubled over the same period in 1996. The majority of
this increase was due to the BCA acquisition. The Company also added
management positions during 1996 in anticipation of ongoing internal
growth and acquisition activities. Furthermore, significant
transitional costs associated with the BCA acquisition and costs
related to the installation of new computer hardware and software were
incurred in the current period. Some of these transitional costs will
continue into the second and third quarters of this year.
Interest expense for the first quarter of 1997 increased $69,000 over
the prior year period as a result of the BCA acquisition.
Income tax expense for the first quarter of 1997 includes a benefit
related to utilization of domestic NOL carryforwards. In the first
quarter of 1996, an income tax benefit was recognized as a result of
the utilization of domestic and foreign NOL's.
<PAGE>
Financial Condition
The Company's liquidity and capital resources remained strong into the
first quarter of 1997. Working capital as of March 31, 1997, was $5.6
million, with a current ratio of 3.4 to 1.0. Approximately $1.3
million of cash was converted into BCA accounts receivable during the
current quarter. The Company's management believes that the current
availability of cash, lines of credit, working capital, and cash flow
from operations are adequate to meet the Company's needs in the
foreseeable future. The Company continues to seek potential
acquisitions and potential sources of capital to finance such
acquisitions, although it has no commitments for either at this time.
<PAGE>
BIOPOOL INTERNATIONAL, INC.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(11) Statements regarding computation of earnings per
share.
(b) Reports on Form 8-K.
Form 8-K/A dated March 14, 1997.
Item 2. Acquisition or Disposition of Assets - Announcement
of acquisition of assets of the Blood Group Serology business
from Organon Teknika.
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: May 7, 1997 BIOPOOL INTERNATIONAL, INC.
-------------------- ---------------------------------
(Registrant)
/s/ Michael D. Bick, Ph.D.
---------------------------------
Michael D. Bick, Ph.D.
Chief Executive Officer and
Chairman of the Board
/s/ Robert K. Foote
---------------------------------
Robert K. Foote
Chief Financial Officer and
Corporate Secretary
<PAGE>
EXHIBIT 11
<TABLE>
BIOPOOL INTERNATIONAL, INC.
Statement Regarding Computation of Per Share Earnings
Three Months Ended March 31,
<CAPTION>
1997 1996
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<S> <C> <C>
Primary
Average shares outstanding 8,576,000 7,949,000
Net effect of dilutive stock options
and warrants based on the treasury
stock method using average market
price 693,000 178,000
Total shares 9,269,000 8,127,000
Net income $ 310,000 $ 300,000
Per share amount $ 0.03 $ 0.04
Fully diluted
Average shares outstanding 8,576,000 7,949,000
Net effect of dilutive stock options
and warrants based on the treasury
stock method using the higher of
average or year-end market price 693,000 208,000
Total shares 9,269,000 8,157,000
Net income $ 310,000 $ 300,000
Per share amount $ 0.03 $ 0.04
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 938,000
<SECURITIES> 0
<RECEIVABLES> 2,844,000
<ALLOWANCES> 0
<INVENTORY> 3,948,000
<CURRENT-ASSETS> 8,016,000
<PP&E> 8,113,000
<DEPRECIATION> 3,811,000
<TOTAL-ASSETS> 13,480,000
<CURRENT-LIABILITIES> 2,384,000
<BONDS> 0
0
0
<COMMON> 86,000
<OTHER-SE> 8,431,000
<TOTAL-LIABILITY-AND-EQUITY> 13,480,000
<SALES> 4,103,000
<TOTAL-REVENUES> 4,103,000
<CGS> 2,485,000
<TOTAL-COSTS> 3,618,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 88,000
<INCOME-PRETAX> 397,000
<INCOME-TAX> (87,000)
<INCOME-CONTINUING> 310,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 310,000
<EPS-PRIMARY> 0.03
<EPS-DILUTED> 0.03
</TABLE>
