<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
Commission File Number 33-22011-A
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
-----------------------------------------------------------------
(Exact name of Small Business Issuer as specified in its charter)
Florida 59-2858209
------------------------ ------------------------------------
(State of incorporation) (I.R.S. Employer Identification No.)
4900 North Habana Ave., Tampa, FL 33614
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (813) 854-4668
--------------
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
----- -----
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
Class Outstanding at March 31, 1999
Common stock, par value $1.00 per share 414 shares
- --------------------------------------- ----------
Documents incorporated by reference
NONE
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TABLE OF CONTENTS
FORM 10-QSB QUARTERLY REPORT - March 31, 1999
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
<TABLE>
<CAPTION>
Page
----
<S> <C> <C> <C>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements 3 - 10
Item 2. Management's Discussion and Analysis or
Plan of Operation 11 - 15
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 16
Item 2. Changes in Securities 17
Item 3. Defaults Upon Senior Securities 17
Item 4. Submission of Matters to a Vote of Security Holders 17
Item 5. Other Information 17
Item 6. Exhibits and Reports on Form 8-K 17
Signatures 18
</TABLE>
2
<PAGE> 3
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
----------- ------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $1,104,001 $1,202,252
Distribution receivable from
limited partnership investments 29,875 40,315
Income taxes receivable 12,500 --
Prepaid expenses 3,858 6,521
---------- ----------
Total current assets 1,150,234 1,249,088
Equity investments 250,915 248,454
Other investments 120,000 20,000
---------- ----------
Total assets $1,521,149 $1,517,542
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accrued expenses $ 31,136 $ 28,998
Due to related party 7,441 8,276
Income taxes payable 39,957 35,340
---------- ----------
Total current liabilities 78,534 72,614
Deferred income taxes 39,771 39,771
---------- ----------
Total liabilities 118,305 112,385
Stockholders' equity:
Common stock, $1 par value: 7,500 shares
authorized; 413 shares at March 31, 1999
and 415 shares at December 31, 1998
issued and outstanding 413 415
Common stock subscribed, 1 share at
March 31, 1999 and 2 shares at
December 31, 1998 1 2
Subscriptions receivable (2,200) (2,300)
Additional paid-in capital 645,191 654,526
Retained earnings 759,439 752,514
---------- ----------
Total stockholders' equity 1,402,844 1,405,157
---------- ----------
Total liabilities and stockholders' equity $1,521,149 $1,517,542
========== ==========
</TABLE>
The accompanying notes
are an integral part of these financial statements.
3
<PAGE> 4
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
For the For the
quarter ended quarter ended
March 31, 1999 March 31, 1998
-------------- --------------
(Unaudited) (Unaudited)
<S> <C> <C>
Distribution income $29,875 $24,705
Equity in net earnings of investees 2,461 893
------- -------
32,336 25,598
Expenses:
Salary 10,000 10,000
General and administrative 23,408 19,324
------- -------
33,408 29,324
Operating (loss) income (1,072) (3,726)
Interest income 12,615 13,731
------- -------
Income before income taxes 11,543 10,005
Provision for income taxes 4,617 3,602
------- -------
Net Income $ 6,926 $ 6,403
======= =======
Net income per common share -
basic and diluted $ 17 $ 15
======= =======
Weighted average shares outstanding and subscribed 414 430
======= =======
</TABLE>
The accompanying notes
are an integral part of these financial statements.
4
<PAGE> 5
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the For the
quarter ended quarter ended
March 31, 1999 March 31, 1998
-------------- --------------
<S> <C> <C>
OPERATING ACTIVITIES
Net income $6,926 $6,403
Adjustments to reconcile net income to
net cash used in operating activities:
Equity in net earnings of investees (2,461) (893)
Distribution income (29,875) (24,705)
Changes in operating assets and liabilities:
Prepaid expenses 2,663 1,875
Income taxes receivable (12,500) (3,058)
Accrued expenses 2,138 2,809
Due to related party (835) 0
Income taxes payable 4,617 (28,340)
---------- ----------
Net cash used in operating activities (29,327) (45,909)
INVESTING ACTIVITIES
Proceeds from sale of equity investment 0 100,000
Purchase of noncurrent investment (100,000) 0
Distributions received 40,315 36,640
---------- ----------
Net cash provided by (used in)investing activities (59,685) 136,640
FINANCING ACTIVITIES
Proceeds from sale of common stock 100 0
Redemption of common stock (9,339) (3,048)
---------- ----------
Net cash used in financing activities (9,239) (3,048)
Increase (decrease) in cash and cash equivalents (98,251) 87,683
Cash and cash equivalents at beginning of quarter 1,202,252 1,150,633
---------- ----------
Cash and cash equivalents at end of quarter $1,104,001 $1,238,316
========== ==========
</TABLE>
The accompanying notes
are an integral part of these financial statements.
5
<PAGE> 6
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
NOTES TO FINANCIAL STATEMENTS
The financial statements included herein have been prepared by St. Joseph's
Physician Associates, Inc. (the "Company"), without audit, pursuant to the
rules and regulations of the Securities and Exchange Commission. In the opinion
of management, the accompanying unaudited financial statements contain all
adjustments necessary to present fairly the financial position of the Company
as of March 31, 1999 and December 31, 1998, and the results of its operations
and its cash flows for the three months ended March 31, 1999 and 1998.
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Organization
The Company was organized on November 20, 1987 as a Florida corporation. The
Company was organized to establish and operate an association of qualified
physicians for the purpose of engaging directly or indirectly in health care
related ventures.
In February 1989, the Company acquired 2,500 shares of the common stock of St.
Joseph's Physicians-Healthcenter Organization, Inc. (the "PHO") for $20 per
share. The 2,500 shares represent 50% of the outstanding common stock of the
PHO. The remaining 2,500 common shares of the PHO are owned by St. Joseph's
Enterprises, Inc.("Enterprises") The PHO also had 6,250 preferred shares
outstanding as of December 31, 1996. Prior to January 31, 1997, the Company
earned equity in the net earnings of the PHO at 22.22% of the PHO's earnings
after deducting a 6% cumulative dividend for the 6,250 preferred shares. The
PHO's preferred shares were redeemed effective January 31, 1997 for $184,375.
As a result of this redemption, the Company and Enterprises now each own a 50%
interest in the PHO. The PHO was organized for the purpose of engaging directly
or indirectly in managed care arrangements and health care related ventures.
In June 1989, the Company acquired 4,000 shares of the common stock in
Hospitals' Home Health Care of Hillsborough County, Inc. d/b/a St. Joseph's
Home Health Services ("SJHHS") for $10 per share. The 4,000 shares represented
50% of the outstanding common stock of SJHHS. On January 5, 1998, the Company
sold all of its ownership interest in SJHHS to St. Joseph's Ancillary Services,
Inc. for $100,000. The investment in SJHHS was sold for a price that was
6
<PAGE> 7
lower than the carrying amount of the equity investment in SJHHS. In
contemplation of the sale, the equity investment in SJHHS was written down in
December 1997 by $200,410, to properly reflect its fair value at December 31,
1997.
Equity Investments
The Company accounts for its investment in the PHO on the equity method.
Accordingly, the investment has been stated in the accompanying balance sheets
at the cost of acquisition plus the Company's equity in the undistributed
earnings/losses since acquisition, less distributions to the Company. None of
the assets or liabilities of the investment are included in the balance sheets
except to the extent of the Company's interests in the underlying net assets
included in equity investments. The Company's net earnings/losses resulting
from its proportionate share of the investees' revenues and expenses are
included in the statements of income.
Other Investments
The Company owns five limited partnership units in St. Joseph's Same-Day
Surgery Center, Ltd. ("SDS"). Management has not actively marketed these
partnership units and intends to hold them beyond one year. Accordingly, this
investment is presented as noncurrent, other investments. The investment is
accounted for at cost due to the Company's limited percentage interest in the
partnership and inability to exercise significant influence over the
partnership. Distributions are recorded as income when declared and reported as
distribution income.
On March 3, 1999, the Company purchased 100,000 shares of common stock,
representing approximately 3% of the outstanding common stock, of Entrusted
Health Management Services, Inc. ("EHMS"), a Florida corporation. The balance
of the outstanding common stock of EHMS is owned by several other individuals
and entities, none of whom holds a majority interest in EHMS. EHMS is a start
up entity that was organized to manage and administer health benefit
arrangements for self-insured employers. Its services ultimately are planned to
include designing and implementing benefit plans, developing one or more
networks of hospitals, physicians and other health care providers,
administering claims, and collecting and analyzing health care data for those
employers with which it has contracts for the provision of some or all of these
offered services.
The investment in EHMS is accounted for at cost due to the Company's limited
percentage interest. Revenue derived from the
7
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EHMS common stock will only be recorded by the Company upon declaration of
distributions or a gain upon sale of the stock. No distributions from EHMS are
anticipated for 1999 or the foreseeable future. The Company has no present
intention to sell the EHMS stock. Accordingly, this investment is presented as
noncurrent, other investments.
Subscriptions Receivable
Subscriptions receivable relate to agreements to purchase common stock of the
Company and are to be paid in installments during 1999.
Cash Equivalents
The Company considers all highly liquid investments with original maturities of
three months or less when purchased to be cash equivalents.
Income Taxes
The Company accounts for income taxes under FASB Statement No. 109, Accounting
for Income Taxes. Deferred income tax assets and liabilities are determined
based upon differences between financial reporting and tax basis of assets and
liabilities and are measured using the enacted tax rates and laws that will be
in effect when the differences are expected to reverse.
Income Per Common Share
Income per common share is based upon the weighted average number of common
shares outstanding and subscribed during the period.
NOTE 2 - RELATED PARTIES:
The members of the Board of Directors of the Company are also members of the
medical staff of St. Joseph's Hospital, Inc., which is owned by St. Joseph's
Health Care Center, Inc. ("HCC"), an affiliate of Enterprises. Until January 31,
1997, HCC provided administrative support to the Company at no charge.
Beginning February 1, 1997, HCC began to charge the Company for administrative
support and direct costs (i.e., food, printing).
All limited partner investors in the PHO's ventures are investors in the
Company. In addition, all physicians who hold provider contracts with a
subsidiary of the PHO are investors in the Company.
8
<PAGE> 9
On October 1, 1991, the Company hired and agreed to pay a salary to an
executive director to provide and facilitate the efficient operations of the
Company. Prior to April 29, 1996, the executive director was a member of the
Company's Board of Directors, and he continues to be a shareholder in the
Company. The Company's payment of compensation to the executive director for
the three months ended March 31, 1999 is presented as salary expense.
9
<PAGE> 10
NOTE 3 - EQUITY INVESTMENTS:
A summary of the changes in equity investments is presented below:
<TABLE>
<CAPTION>
PHO Total
-------- --------
<S> <C> <C>
Balance at December 31, 1998 $248,454 $248,454
Proceeds from sale of investment 0 0
Equity in net earnings of investees 2,461 2,461
-------- --------
Balance at March 31, 1999 $250,915 $250,915
======== ========
</TABLE>
The condensed balance sheets and statements of operations of the PHO are as
follows:
<TABLE>
<CAPTION>
Balance Sheets - PHO March 31, 1999 December 31, 1998
- -------------------- -------------- -----------------
(unaudited)
<S> <C> <C>
Assets:
Currents assets $430,761 $423,024
Noncurrent assets 200,258 220,747
-------- --------
Total assets $631,019 $643,771
======== ========
Liabilities and stockholders'
equity:
Current liabilities $119,529 $146,863
Long-term liabilities 0 0
Stockholders' equity 511,490 496,908
-------- --------
Total liabilities and
stockholders' equity $631,019 $643,771
======== ========
</TABLE>
<TABLE>
<CAPTION>
For the Three Months Ended
------------------------------
March 31, March 31,
Statements of Operations - PHO 1999 1998
- ------------------------------ ----------- ----------
(unaudited) (unaudited)
<S> <C> <C>
Equity in partnership earnings $14,168 $25,885
Other revenues 22,645 41,775
Expenses 30,242 65,032
------- -------
Income before taxes 6,571 2,628
Income tax provision 1,650 842
------- -------
Net income $ 4,921 $ 1,786
======= =======
</TABLE>
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ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
PART I - FINANCIAL INFORMATION
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OR PLAN OF OPERATION
March 31, 1999
Liquidity
Cash resources of the Company decreased by $98,251 during the first three
months of 1999, as compared to an increase in cash resources of $87,683 during
the first three-month period in 1998. The decrease in cash resources resulted
primarily from the purchase on March 3, 1999 of EHMS common stock for $100,000
(while the increase during 1998 resulted primarily from the $100,000 sale of
the common stock of SJHHS on January 5, 1998). This was offset by an increase
in cash resources resulting from an increase in the quarterly distributions
received with respect to the five SDS limited partnership units and a decrease
in expenditures for operating expenses and estimated tax payments.
On March 3, 1999, the Company purchased approximately 3% (100,000 shares) of
the common stock of EHMS, for which it paid $100,000. No distributions from
EHMS are anticipated for 1999 or the foreseeable future, and there can be no
assurance that the Company ever will receive any distributions from EHMS.
On January 5, 1998, the Company sold its 4,000 shares of the common stock in
SJHHS to St. Joseph's Ancillary Services, Inc., which owned the other 50% of
the common stock, for $100,000. Although the sale of the equity investment in
SJHHS had the impact of increasing then current cash resources, it also
eliminated a future income source and thus has had and continues to have the
impact of reducing cash flow from operations of the Company.
St. Joseph's Health Network, Inc. ("SJHN") is a 100%-owned subsidiary of the
PHO. SJHN, a physician-hospital organization, negotiates at-risk products
(i.e., capitation products) with managed care organizations on behalf of its
membership to provide high quality, competitively priced health care services
for persons residing or employed in the Tampa area. During the first three
months of 1999, SJHN did not generate sufficient revenues to offset its
operating expenses. Accordingly, in the near future, the Company might find it
appropriate to deal with the financial impact on the PHO of SJHN's losses, one
alternative being to assist the PHO with providing additional capitalization
for SJHN. The amount
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<PAGE> 12
of funding, if any, has not been determined at this time. However, the
Company's contribution to such funding would be determined by taking into
account the Company's available liquidity and its other anticipated cash needs.
Additional liquidity for SJHN also is expected to be received from other
sources, including provider credentialing fees, additional equity contributions
from the PHO and/or borrowings.
On March 31, 1999, a $29,875 distribution with respect to the five SDS limited
partnership units was declared and will be received during the second quarter
of 1999.
Management believes that current cash reserves and additional distributions
with respect to the five SDS limited partnership units will provide adequate
short-term funding of the Company's on-going operations. However, the Company
recognizes that its current revenues may not be sufficient to fund its expenses
as they currently exist. A review of expenses and strategic planning for
additional revenue sources is currently underway.
Capital Resources
The Company does not anticipate the need for any significant capital
expenditures in connection with its current operations for the foreseeable
future. If, as a result of the strategic planning that currently is underway,
the Company determines that capital expenditures are necessary or appropriate,
it is anticipated that the Company's current cash reserves would be used for
this purpose. Any additional funds would then come from additional sales of the
Company's common stock. The Company expects to commence a private offering of
its common stock in May 1999 at $3,388 per share. Although there can be no
assurance, the Company does not anticipate substantial difficulty in raising
additional funds, should the need arise.
Results of Operations
Equity in net earnings of investees is the result of the Company's investment
in the PHO. The equity in net earnings increased during the first three months
of 1999, as compared to the first quarter of 1998, resulting from an increase
in the profitability of the PHO. Expenses for the PHO decreased during the
first three months of 1999 as a result of a revision to the HCC management fee
allocation. The Board of Directors of the PHO and the Board of Directors of
physician-hospital organizations at Bayfront Medical Center, Inc. and South
Florida Baptist Hospital, Inc. (organizations affiliated with HCC) approved a
revision to the
12
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manner in which the management fee (which includes aggregate PHO fixed costs)
that is paid by each physician-hospital organization to HCC is allocated, in
order to align these support activities along geographic and community
boundaries. The new allocation method results in a lower percentage allocated
to the PHO, thereby resulting in a decrease in the PHO's general and
administrative expenses.
The Company owns five SDS limited partnership units and receives quarterly
distributions on such units. Distribution income for the first quarter of 1999
was higher than for the same period in 1998. The distribution was calculated by
taking into account anticipated operating cash needs of SDS, with the intent of
maintaining appropriate reserves.
Interest earnings represent interest on bank deposits. The decrease between
1999 and 1998 resulted from slightly lower cash balances in 1999 than during
the same period of 1998.
General and administrative expenses increased during the first quarter compared
to the same period of 1998. The increase in expenses resulted from an increase
in consulting fees related to the review of the operations of SDS. It is
anticipated that over the near term, general and administrative expenses will
continue to be incurred at comparable levels.
Salary expense remained consistent with the same time period of 1998.
Expenditures incurred relate to the compensation paid to the executive
director.
During the first quarter of 1999, the Company had net income of $6,926.
Therefore, the net income per common share was $17 for the first quarter of
1999. The net income per common share for the first quarter of 1998 was $15 per
share. The increase in the net income per common share for the first quarter of
1999 resulted from an increase in net income, which was attributable to the
factors described above, and a decrease in the number of outstanding shares of
the Company's common stock resulting from redemptions during 1998.
Several new laws and regulations affecting the health care business were
adopted, at both the state and federal levels, during 1997, 1998, and 1999,
including health care reform that was considered and adopted by the Florida
Legislature during its recently concluded 1999 Session. Additional health care
reform legislation also has been proposed for consideration in 1999 at the
federal level. All of the legislation and regulation could have a dramatically
adverse impact on the Company, its related investments, and the stockholders of
the Company. The Company is
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continuing to monitor and evaluate the impact of such changes in laws and
regulations.
Year 2000
The Company is aware of the issues associated with the programming code in
existing systems as the Year 2000 approaches, and it has developed an
implementation plan to resolve this issue by June 30, 1999. This plan involves
the assessment of whether the existing hardware system and accounting software
used in the management of the Company's operations are Year 2000 compliant. The
third party providing the Company's administrative support services currently
operates only one PC in connection with the Company's administrative operations
and runs only widely-used "off the shelf" third party software in connection
with performing these services. The Company expects that the third party
handling the administrative support services is Year 2000 compliant and that,
even if it is determined that such hardware and software are not Year 2000
compliant, then the third party will incur the cost to replace such hardware
and/or software (because such cost is not anticipated to be significant).
Furthermore, the Company believes that even if the hardware and/or software are
not made Year 2000 compliant, then the Company would simply have a short term
information gap until new hardware and/or software is purchased by the third
party handling the administrative services; but the information gap would not
be expected to have a material adverse impact on the Company, its financial
condition or its results of operations. The Company does not currently own or
operate any Information Technology ("IT") systems, and it has not identified
any non-IT systems, such as equipment with embedded chips, that currently are
in operation by the Company.
The Company also is making inquiries as to the Year 2000 readiness of other
third parties (including the PHO, SDS, and other unrelated third parties) that
could cause a material impact on the Company. The Company has received some
preliminary information concerning the status of third parties and anticipates
initiating more extensive inquiries. The PHO and SDS have completed the risk
assessment phase and are in the process of upgrading and replacing systems and
equipment found not to be compliant, and the Company has been informed that
these entities expect to achieve Year 2000 compliance by December 1999.
However, there can be no assurances that computer systems of any third party,
whether related or unrelated, will be Year 2000 compliant, or that any failure
to be compliant will not have a material adverse impact on the Company, its
financial condition or its results of operations.
In addition, the Company believes that a significant number of the stockholders
of the Company acquired stock in the Company for the
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<PAGE> 15
purpose of being eligible to participate in certain activities that are
available only to the stockholders of the Company (e.g., participation on the
provider networks of SJHN and St. Joseph's Preferred, Inc. ("SJP"), a
100%-owned subsidiary of the PHO). It is possible that a Year 2000 compliance
failure by SJP, SJHN, or a third party with which any of these entities
contracts, could have a material adverse impact on the individual stockholders
who participate in the various provider panels operated by these entities, even
though the compliance failure would not have a material adverse impact on the
Company, its financial condition or its results of operations. Whether or not
any such adverse effect occurs is beyond the control of the Company, and the
extent of the adverse effect will depend upon the individual stockholder's
particular circumstances.
At this time, the Company does not believe that it is necessary to have a
contingency plan for the Year 2000 issue. However, this need will be
continuously monitored as the Company receives more information about the
preparations of third parties.
15
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ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
To the knowledge of the Company's management, there are no material pending
legal proceedings, other than ordinary routine litigation incidental to the
business of the Company, or its Partially Owned Operations, to which the
Company or any of its Partially Owned Operations is a party or of which any of
their property is the subject.
16
<PAGE> 17
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On May 3, 1999, the annual stockholders meeting of the Company was held.
Directors elected at the meeting were:
<TABLE>
<CAPTION>
Number of Votes
----------------
For Withheld
--- --------
<S> <C> <C>
N. Bruce Edgerton, M.D. (term expiring 2003) 182 1
Angel Docobo, M.D. (term expiring 2003) 182 1
Wilfred Idsten, M.D. (term expiring 2000) 182 1
</TABLE>
Other directors whose term of office continued after the meeting were:
Lane France, M.D. William Luria, M.D.
Allen Miller, M.D. Benedict Maniscalco, M.D.
Anthony Brannan, M.D. Norman Castellano, M.D.
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
27 - Financial Data Schedule (for SEC use only)
b. Reports on Form 8-K
None
17
<PAGE> 18
SIGNATURES
May 12, 1999
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ST. JOSEPH'S PHYSICIAN ASSOCIATES, INC.
---------------------------------------
(Registrant)
Date: May 12, 1999 /s/ N. Bruce Edgerton, M.D.
-------------------------------------------
N. Bruce Edgerton, M.D., President
St. Joseph's Physician Associates, Inc.
Date: May 12, 1999 /s/ Allen Miller, M.D.
-------------------------------------------
Allen Miller, M.D., Treasurer and
Principal Financial Officer
St. Joseph's Physician Associates, Inc.
18
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (A) ST.
JOSEPH'S PHYSICIAN ASSOCIATES, INC. 3/31/99 BALANCE SHEET AND INCOME STATEMENT
FOR THE THREE MONTHS ENDED 3/31/99 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH (B) FORM 10-QSB FOR THE QUARTERLY PERIOD ENDED 3/31/99.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-01-1999
<CASH> 1,104,001
<SECURITIES> 0
<RECEIVABLES> 29,875
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,150,234
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,521,149
<CURRENT-LIABILITIES> 78,534
<BONDS> 0
0
0
<COMMON> 643,405
<OTHER-SE> 759,439
<TOTAL-LIABILITY-AND-EQUITY> 1,521,149
<SALES> 0
<TOTAL-REVENUES> 44,951
<CGS> 0
<TOTAL-COSTS> 33,408
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 11,543
<INCOME-TAX> 4,617
<INCOME-CONTINUING> 6,926
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,926
<EPS-PRIMARY> 17
<EPS-DILUTED> 17
</TABLE>
