<PAGE> 1
FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED APRIL 30, 1998
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 No. 33-245-66-A
BIO-LOK INTERNATIONAL INC.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its Charter)
DELAWARE 65-0317138
(State or other jurisdiction of (IRS Employee
incorporation or organization) Identification No.)
312 S. MILITARY TRAIL
DEERFIELD BEACH, FLORIDA 33442
(Address of principal executive offices) (Zip Code)
Registrant's Telephone number, including area code (954) 698-9998
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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 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 Registrant's classes of
Common Stock.
CLASS OF COMMON STOCK OUTSTANDING AT APRIL 30, 1998
--------------------- -----------------------------
$.01 par value 40,998,020 shares
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BIO-LOK INTERNATIONAL INC.
Index
Part I. Financial Information
<TABLE>
Page #
<S> <C>
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Statements of Income
Three and Six months ended April 30, 1998 and 1997 3
Condensed Consolidated Balance Sheets for
April 30, 1998 and October 31, 1997 4
Condensed Consolidated Statements of Cash Flows
Six months ended April 30, 1998 and 1997 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial 6
Results of Operations 6
Financial Condition 7
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BIO-LOK INTERNATIONAL INC.
Condensed Operating Results
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
APRIL 30, APRIL 30,
------------------------------- ------------------------------
1998 1997 1998 1997
------------ ------------ ------------ ------------
('000's) ('000's) ('000's) ('000's)
<S> <C> <C> <C> <C>
NET SALES $ 407 $ 395 $ 772 $ 699
Cost of Goods Sold 127 127 234 210
------------ ------------ ------------ ------------
GROSS PROFIT 280 268 538 489
Selling 88 69 175 138
Admin. & General Exp 151 162 304 290
------------ ------------ ------------ ------------
239 231 479 428
------------ ------------ ------------ ------------
INCOME FROM OPERATIONS 41 37 59 61
Other (Income) & Expense 29 (651) 49 (629)
------------ ------------ ------------ ------------
Income before Taxes 12 688 10 690
Income Taxes 0 0 0 0
------------ ------------ ------------ ------------
NET INCOME (loss) $ 12 $ 688 $ 10 $ 690
============ ============ ============ ============
Net Income Available to
Common Share Owners $ 12 $ 688 $ 10 $ 690
============ ============ ============ ============
Net Income per Common Share $ -- $ .05 $ -- $ .05
============ ============ ============ ============
Dividends per Common Share $ -0- $ -0- $ -0- $ -0-
============ ============ ============ ============
Average Common Shares
Outstanding 40,998,020 14,539,965 37,870,445 14,288,913
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE> 4
BIO-LOK INTERNATIONAL INC.
Condensed Balance Sheets
(Unaudited)
<TABLE>
<CAPTION>
APRIL 30, OCTOBER 31,
1998 1997
------- -------
('000's) ('000's)
<S> <C> <C>
ASSETS
Current Assets
Cash $ 1 $ 4
Accounts Receivable (Net) 609 490
Inventory 1,180 1,163
Other Current Assets 0 20
------- -------
Total Current Assets 1,790 1,677
------- -------
Net Machinery & Equipment 284 321
Investment 51 -0-
Other Assets 40 15
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Total Other Assets 375 336
------- -------
TOTAL ASSETS $ 2,165 $ 2,013
======= =======
LIABILITIES & EQUITY
Current Liabilities
Revolving Loan Payable $ 369 $ 247
Accounts Payable 133 141
Other Payables 67 0
Accrued Expenses 57 15
Current Portion of LTD 170 171
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Total Current Liabilities 796 574
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A/P Plan Pymts 436 567
Other Long Term Debt 128 76
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Long Term Debt 564 643
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Total Liabilities 1,360 1,217
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Equity
Common Stock - authorized
50,000 par value $.01;
outstanding 40,998,020 and
34,742,870 shares respectively; 410 347
Paid-in Capital 1,649 1,649
Retained Earnings (1,264) (1,202)
Retained Earnings - CY 10 0
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Total Equity 805 796
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TOTAL LIABILITIES & EQUITY $ 2,165 $ 2,013
======= =======
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE> 5
BIO-LOK INTERNATIONAL INC.
Condensed Statement of Cash Flow
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
April 30,
---------------------
1998 1997
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(000's) (000's)
<S> <C> <C>
OPERATING ACTIVITIES:
Net Income $ 10 $ 690
Depreciation 42 49
Change in Operating Assets & Liabilities (41) (1,314)
------- -------
Net Cash Provided by Operating 11 (575)
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FROM INVESTING ACTIVITIES:
Property, Plant & Equipment (6) 133
Decrease in Long Term Debt (79) 189
Invest. in Subsidiaries (51) 0
Proceeds from Issue of Common Stock (62) 0
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Net Cash Used for Investing Activities (198) 322
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FROM FINANCING ACTIVITIES:
Revolving Loan 122 100
Issuance of Debt to Shareholder -0- 146
Common Stock Issued 62 12
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Net Cash Used for Financing Activities 184 258
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NET INCREASE (DECREASE) IN CASH $ (3) $ 5
Cash - Beginning of Period 4 1
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Cash - End of Period $ 1 $ 6
======= =======
Interest Paid $ 48 $ 10
Income Taxes Paid $ -0- $ -0-
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE> 6
BIO-LOK INTERNATIONAL INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The financial statement for 1998 consists of all the accounts of Bio-Lok
International Inc. ("BLII").
NOTE B - NATURE OF BUSINESS
BLII is a manufacturer and distributor both domestic and internationally of
precision dental implants, related prosthetics, associated tools, devices and
irrigated drills to the dental market.
Revenues are attributable to the manufacturing operation, distribution
agreements negotiated, marketing efforts of the Company, and are recorded when
the goods are shipped.
NOTE C - INVENTORIES
Inventories are stated at average cost. Inventories at April 30, 1998 and
October 31, 1997 consisted of the following:
APRIL 30, 1998 OCTOBER 31, 1997
---------- ----------
Raw Materials & Supplies $ 10,543 $ 31,748
Consumable Tools 35,000 35,000
Work in Process 408,521 445,340
Finished Goods 725,647 650,957
---------- ----------
$1,179,711 $1,163,045
========== ==========
Inventory reflects a net increase for the period of $17k. The increase is
attributed to the build up of the new Micro-Lok Cylinder Implant and the
Micro-Lok Silhouette Screw Implant of the product line.
NOTE D - CHANGE IN BUSINESS ACTIVITY
Effective February 12, 1997, the Plan of Reorganization filed by the Company was
approved by the Court. The plan was fully adopted as of March 14, 1997 with all
initial payments to debtors have been issued and disbursed.
The Chapter XI was finalized and closed effective February , 1998.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
VOLUME
Net sales/revenue for the quarter increased by $42K or 11.5% from prior quarter
and $73k or 10.4% for the comparable period prior year. The increase is
attributable to continued expansion of the international markets.
COST OF GOODS SOLD AND GROSS PROFIT
Cost of goods sold for the quarter reflected no change from the same prior years
quarter, but increased this quarter by $20 or 18.7% from the prior quarter.
Year-to-date results increased by $24k or 11.4% over prior period. The increase
relates directly to the increase in sales then as a percent of sales the cost of
goods sold has remained at approximately 30%.
Gross Profit for the quarter improved by $12k or 4% over the same quarter prior
year and $22k or 8.5% from prior quarter results.
<PAGE> 7
SELLING, ADMINISTRATIVE & GENERAL EXPENSES
Selling expenses for the period reflected no change from prior quarter but
reflect an increased of $19k or 27.5% over prior years quarter and $37k or 26.8%
over prior years YTD results. The increase over prior year results is due to
hiring of a sales person for the Chicago area and a domestic sales manager.
Administrative and general expenses for the period similarly resulted in no
change over the prior quarter.
Results for the period to the same period prior year reflected a decrease of
$11k or 6.8% and for six months year -to-date results where $14k or 4.8% lower.
The reduced results are attributable to select lower costs incurred in 1998 for
consulting and professional services.
RESULTS FROM OPERATIONS
Results from operation for the quarter increased to $41k, an increase of $19k
from prior quarter and was 11.7% greater than for the same period prior year.
OTHER (INCOME) & EXPENSES
Current period results reflect the costs incurred by the company for the issue
of common stock totaling $63k for the period. The stock was issued as requested
by the Board of Directors for services rendered by individuals to the company.
The balance of the increased costs incurred is attributable to interest expense
incurred for the increase in the revolving loan outstanding and the interest
recorded on the Plan payments resulting from the reorganization recorded in
early 1997.
NET INCOME
Net income for the quarter after adjusting for the common stock issue totaled
$12k for the quarter and $10k on a year-to-date basis. Adjusting prior year
results for the extra-ordinary gains realized from the adoption of the Plan of
Reorganization results would have been a break-even. Therefore, the results both
current quarter and year to date would reflect a slight increase in results.
FINANCIAL CONDITION
NET CASH FLOW PROVIDED BY OPERATIONS
Cash flow provided from operations decreased by $3k for the period.
FINANCING
No new financing arrangements have been entered into during the past quarter.
The company did borrow an added $81K under its Revolving Loan Agreement. The
funds were utilized for general working capital and for completing is ISO 9001
and CE Mark registration in the EEC.
SIGNATURE
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.
BIO-LOK INTERNATIONAL INC.
(Registrant)
Date : June 11, 1998 By: /s/ Ingo K. Kozak
-------------------------------
Ingo K. Kozak
Chief Financial Officer and
on behalf of the Registrant
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> FEB-01-1998
<PERIOD-END> APR-30-1998
<CASH> 1,000
<SECURITIES> 0
<RECEIVABLES> 636,959
<ALLOWANCES> 27,679
<INVENTORY> 1,179,711
<CURRENT-ASSETS> 1,789,991
<PP&E> 1,004,454
<DEPRECIATION> 720,138
<TOTAL-ASSETS> 2,165,436
<CURRENT-LIABILITIES> 795,466
<BONDS> 564,001
0
0
<COMMON> 409,980
<OTHER-SE> 395,989
<TOTAL-LIABILITY-AND-EQUITY> 2,165,436
<SALES> 407,192
<TOTAL-REVENUES> 407,192
<CGS> 126,849
<TOTAL-COSTS> 88,209
<OTHER-EXPENSES> 152,651
<LOSS-PROVISION> 3,745
<INTEREST-EXPENSE> 24,150
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 11,588
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,588
<EPS-PRIMARY> .001
<EPS-DILUTED> .001
</TABLE>
