<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30,1997 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 0-18053
LASERSCOPE
(Exact name of Registrant as specified in its charter)
CALIFORNIA 77-0049527
(State of Incorporation) (I.R.S. Employer Identification No.)
3052 ORCHARD DRIVE, SAN JOSE, CALIFORNIA 95134-2011
(Address of principal executive offices)
Registrant's telephone number: (408) 943-0636
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 [ ]
The number of shares of Registrant's common stock issued and outstanding as of
July 31, 1997 was 12,261,584.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I. FINANCIAL INFORMATION............................................................................ 3
Item 1. Condensed Consolidated Balance Sheets..................................................... 3
Condensed Consolidated Statements of Income ............................................. 4
Condensed Consolidated Statements of Cash Flows........................................... 5
Notes to Condensed Consolidated Financial Statements...................................... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations............................................. 9
Results of Operations..................................................................... 9
Liquidity and Capital Resources........................................................... 12
Item 3. Qualitative and Quantitative Disclosures About Market Risk................................ 13
PART II. OTHER INFORMATION.............................................................................. 13
Item 1. Legal Proceedings........................................................................ 13
Item 2. Changes in Securities.................................................................... 13
Item 3. Defaults upon Senior Securities.......................................................... 13
Item 4. Submission of Matters to a Vote of Security Holders...................................... 13
Item 5. Other Items.............................................................................. 14
Item 6. Exhibits and Reports on Form 8-K........................................................ 14
SIGNATURE................................................................................................ 14
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
LASERSCOPE
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
(thousands) 1997 1996
- -------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 1,837 $ 3,917
Accounts receivable, net 17,385 13,286
Inventories 21,307 17,407
Other current assets 877 926
-------- --------
Total current assets 41,406 35,536
Property and equipment, net 5,542 3,109
Investment in NWL - 1,681
Developed technology and other intangibles, net 5,313 3,473
Other assets 683 670
-------- --------
Total assets $ 52,944 $ 44,469
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 8,787 $ 9,246
Accrued compensation 1,970 2,947
Bank loans 4,291 -
Other current liabilities 5,141 4,899
-------- --------
Total current liabilities 20,189 17,092
Obligations under capital leases 179 202
Mortgages & other long term loans 1,756 -
Commitments and contingencies
Minority interest in net assets of NWL 564 -
Shareholders' equity:
Common stock 50,500 48,798
Accumulated deficit (19,351) (20,988)
Translation adjustments (518) (260)
Notes receivable from shareholders (375) (375)
-------- --------
Total shareholders' equity 30,256 27,175
-------- --------
Total liabilities and shareholders' equity $ 52,944 $ 44,469
======== ========
</TABLE>
See notes to condensed consolidated financial statements
3
<PAGE> 4
LASERSCOPE
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
(thousands except per share amounts) 1997 1996 1997 1996
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net revenues ................................. $ 15,207 $ 8,481 $ 30,970 $ 16,203
Cost of sales ................................ 8,178 4,288 16,865 8,140
-------- -------- -------- --------
Gross margin ................................. 7,029 4,193 14,105 8,063
Operating expenses:
Research and development ................ 695 522 1,365 1,151
Selling, general and administrative ..... 5,277 3,401 10,678 6,493
-------- -------- -------- --------
5,972 3,923 12,043 7,644
Operating income ............................. 1,057 270 2,062 419
Interest and other income (expense), net ..... 2 15 (24) 22
-------- -------- -------- --------
Income before income taxes & minority interest 1,059 285 2,038 441
Provision for income taxes ................... 229 34 327 53
-------- -------- -------- --------
Income before minority interest .............. 830 251 1,711 388
Minority interest ............................ 74 - 74 -
-------- -------- -------- --------
Net income ................................... $ 756 $ 251 $ 1,637 $ 388
======== ======== ======== ========
Net income per share ......................... $ 0.06 $ 0.03 $ 0.13 $ 0.05
======== ======== ======== ========
Shares used in per share calculations ........ 12,994 7,657 13,017 7,512
======== ======== ======== ========
</TABLE>
See notes to condensed consolidated financial statements
4
<PAGE> 5
LASERSCOPE
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
(thousands) 1997 1996
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 1,637 $ 388
Adjustments to reconcile net income to cash
cash provided (used) by operating activities:
Depreciation and amortization 1,023 513
Increase (decrease) from changes in:
Accounts receivable (2,425) (720)
Inventories (769) 1,290
Other current assets 173 157
Other assets - (245)
Accounts payable (2,077) 185
Accrued compensation (977) 213
Other current liabilities 243 (397)
------- -------
Cash provided (used) by operating activities (3,172) 1,384
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (2,049) (280)
Cash paid for NWL acquisition, net of cash received (954) -
Other (184) (99)
------- -------
Cash used by investing activities (3,187) (379)
------- -------
CASH USED BY FINANCING ACTIVITIES:
Payments on obligations under capital leases (23) (7)
Proceeds from the sale of common stock under stock plans 1,702 156
Proceeds from short-term bank loans 3,900 -
Repayment of short-term bank loans (1,300) -
------- -------
Cash provided by financing activities 4,279 149
Increase (decrease) in cash and cash equivalents (2,080) 1,154
Cash and cash equivalents, beginning of period 3,917 2,278
------- -------
Cash and cash equivalents, end of period $ 1,837 $ 3,432
======= =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 132 $ 6
Income taxes $ 56 $ 32
</TABLE>
See notes to condensed consolidated financial statements
5
<PAGE> 6
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
1. The accompanying condensed consolidated financial statements include
Laserscope (the "Company") and its wholly and majority-owned subsidiaries.
All intercompany transactions and balances have been eliminated. While the
financial information in this report is unaudited, in the opinion of
management, all adjustments (which included only normal recurring
adjustments) necessary to present fairly the financial position and results
of operations as of and for the periods indicated have been recorded.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from those reported. It
is suggested that these consolidated financial statements be read in
conjunction with the consolidated financial statements and the notes
thereto for the year ended December 31, 1996 included in the Company's
annual report on Form 10-K/A for the year ended December 31, 1996. The
results of operations for the three and six month periods ended June 30,
1997 are not necessarily indicative of the results expected for the full
year.
2. Inventory was comprised of the following (in thousands):
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1997 1996
------------------------
<S> <C> <C>
Sub-assemblies and purchased parts $14,870 $12,015
Finished goods 6,437 5,392
------- -------
$21,307 $17,407
======= =======
</TABLE>
(See note 7 for a description of the impact from the NWL Laser-Technologie
acquisition.)
3. Net income per share is based upon the weighted average number of shares of
common stock outstanding and dilutive common equivalent shares from stock
options (using the treasury stock method).
4. The Company invests its excess cash in investment grade debt instruments.
The Company considers cash equivalents to be financial instruments that are
readily convertible to cash, subject to no more than insignificant interest
rate risk and that have original maturities of three months or less.
At June 30, 1997 and December 31, 1996 the Company's cash equivalents were
in the form of institutional money market accounts and totaled $0.6 million
and $1.8 million, respectively. At June 30, 1997 and December 31, 1996 the
Company had no investment in debt securities.
5. 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 of
Statement 128 is expected to increase primary earnings per share in each of
the three and six month periods ended June 30, 1997 by $0.01 per share and
to have no material effect on the primary earnings per share for
6
<PAGE> 7
the corresponding periods in 1996. The impact of Statement 128 on the
calculation of fully diluted earnings per share for these periods is not
expected to be material.
6. On August 30, 1996 the Company completed the acquisition of Heraeus
Surgical, Inc. ("HSI"). The acquisition was accounted for as a purchase.
Accordingly, the operating results of HSI are included in the Company's
consolidated results of operations for the quarter and six months ended
June 30, 1997; however, such HSI results are not included in the Company's
consolidated results of operations for the corresponding periods in 1996.
7. In March 1995, the Company entered into an agreement with NWL
Laser-Technologie ("NWL") whereby the Company paid approximately $1.6
million in exchange for a cross-distribution and development agreement,
minority equity position in NWL and an option to purchase all of the
ownership interests in NWL.
On June 13, 1997, the Company exercised its option and increased its
ownership interest to 52% of NWL. The purchase price was allocated to the
acquired assets and liabilities based on Company estimates of their
respective fair values. The consolidation of the acquired assets and
liabilities significantly impacted the Company's Balance Sheet at June 30,
1997 as depicted in the following tables:
The approximate purchase price for the NWL acquisition was (in thousands):
<TABLE>
<S> <C>
Laserscope investment prior to June 1997 $1,640
Cash paid in June 1997 1,000
------
Total $2,640
</TABLE>
The allocation of the approximate purchase price was determined as
follows:
<TABLE>
<S> <C>
Net tangible assets acquired:
Accounts receivable, net $ 1,670
Inventories 3,130
Property, plant & equipment 1,070
Other assets 200
Less: Accounts payable and other current liabilities (3,300)
Mortgages and other long term debt (1,750)
-------
Total net tangible assets 1,020
Minority interest in net tangible assets (490)
-------
Laserscope interest in net tangible assets 530
Intangible assets acquired:
Developed technology & workforce 2,110
-------
$ 2,640
</TABLE>
7
<PAGE> 8
8. The following unaudited pro forma combined results of operations of the
Company and NWL for the three and six months ended June 30, 1997 and June
30, 1996 have been prepared assuming that the NWL acquisition had occurred
at the beginning of the period presented. The following pro forma
information is not necessarily indicative of the results that would have
occurred had the acquisition been completed at the beginning of the period
indicated, nor is it indicative of future operating results (in thousands,
except per share data):
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
1997 1996 1997 1996
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net revenues ........................ $16,127 $ 9,655 $32,709 $18,443
Income from operations .............. $ 910 $ 220 $ 1,984 $ 472
Net income .......................... $ 693 $ 267 $ 1,607 $ 419
Net income per share ................ $ 0.05 $ 0.03 $ 0.12 $ 0.06
Shares used in per share calculations 12,994 7,657 13,017 7,512
</TABLE>
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS:
Except for the historical information contained in this Quarterly Report on Form
10-Q, the matters discussed herein are forward-looking statements made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Investors are cautioned that all forward-looking statements are subject to
certain risks and uncertainties that could cause the actual results to differ
materially from those projected. Factors that could cause actual results to
differ materially include, but are not limited to, the risks associated with the
acquisitions of Heraeus Surgical, Inc. ("HSI") and NWL Laser-Technologie, GmbH
("NWL"), including the integration of the operations and assets acquired and the
assumption of the liabilities assumed by Laserscope, the timing of orders and
shipments, the Company's ability to balance its inventory and production
schedules, the timely development, clearance by the F.D.A. and other regulatory
agencies and market acceptance of new products and surgical/therapeutic
procedures, the impact of competitive products and pricing, the Company's
ability to raise capital on terms acceptable to the Company, or at all, the
Company's ability to expand further into international markets, and public
policy relating to health care reform in the United States and other countries.
The Company desires to continue expansion of its operations outside of the
United States and to enter additional international markets, requiring
significant management attention and financial resources and further subjecting
the Company to the risks of operating internationally. These risks include
unexpected changes in regulatory requirements, delays resulting from difficulty
in obtaining export licenses for certain technology, customs, tariffs and other
barriers and restrictions, and the burdens of complying with a variety of
foreign laws. The Company is also subject to general geopolitical risks in
connection with its international operations, such as political and economic
instability and changes in diplomatic and trade relationships. The Company
cannot predict whether quotas, duties, taxes or other charges or restrictions
will be imposed by the United States, Japan, countries in the European Union or
other countries upon the import or export of the Company's products in the
future, or what effect any such actions would have on its business, financial
condition or results of operations. In addition, fluctuations in currency
exchange rates may negatively impact the Company's ability to compete in terms
of price against products denominated in local currencies. In addition, there
can be no assurance that regulatory, geopolitical and other factors will not
adversely impact the Company's operations in the future or require the Company
to modify its current business practices.
Other risks are detailed from time to time in the Company's press releases and
other public disclosure filings with the U.S. Securities and Exchange Commission
(SEC), copies of which are available upon request from the Company. The
forward-looking statements included herein speak only as of the date hereof. The
Company assumes no obligation to update any forward-looking statements included
herein.
RESULTS OF OPERATIONS:
The following discussion should be read in conjunction with the unaudited
consolidated financial statements and notes thereto included in Part I -- Item 1
of this Quarterly Report and the audited financial statements and notes thereto
and Management's Discussion and Analysis of Financial Condition and Results of
Operations for the year ended December 31, 1996 contained in the Company's
Annual Report on Form 10-K/A.
9
<PAGE> 10
The following table contains selected income statement information which serves
as the basis of the discussion of the Company's results of operations for the
quarter and six months ended June 30, 1997 (in thousands except for
percentages):
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, 1997 JUNE 30, 1996 % JUNE 30,1997 JUNE 30, 1996 %
AMOUNT %(a) AMOUNT %(a) CHANGE AMOUNT %(a) AMOUNT %(a) CHANGE
------------ ------------- ------ ------------- ------------- ------
Revenues from sales of:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Lasers $ 6,997 46% $ 3,976 47% 76% $13,904 45% $ 6,978 43% 99%
Ascent medical systems 2,662 17% - - - 5,538 18% - - -
Instruments & supplies 3,599 24% 3,292 39% 9% 7,655 25% 6,761 42% 13%
Service 1,949 13% 1,213 14% 61% 3,873 12% 2,464 15% 57%
------- -- ------- -- -- ------- -- ------- -- --
Total net revenues $15,207 100% $ 8,481 100% 79% $30,970 100% $16,203 100% 91%
Gross margin $ 7,029 46% $ 4,193 49% 68% $14,105 46% $ 8,063 50% 76%
Research & Development $ 695 5% $ 522 6% 33% $ 1,365 4% $ 1,151 7% 19%
Selling, general & admin. $ 5,277 35% $ 3,401 40% 55% $10,678 34% $ 6,493 40% 64%
</TABLE>
(a) expressed as a percentage of total net revenues.
The Company's results for the quarter and six month period ended June 30, 1997
were favorably impacted by the acquisition of a majority interest in NWL which
closed June 13, 1997. NWL contributed approximately $1.0 million in revenue and
$80 thousand in net income after distribution to minority interests during the
period from the closing date until June 30, 1997. The Company believes that
these results are not indicative of a normal two week period but reflect a
shipment pattern whereby a significant portion of a quarter's shipments may take
place in the latter part of the quarter.
Net revenues increased during the three and six months ended June 30, 1997
relative to the corresponding periods of 1996 as a combined result of higher
unit shipments of the Company's laser systems at lower average selling prices,
higher shipments of instrumentation, shipments of products and sales of services
acquired in the acquisition of HSI completed in August 1996 and shipments of
products acquired in the acquisition of NWL completed in June 1997.
Revenues from the sales of laser systems increased during the quarter and six
month periods ended June 30, 1997 relative to the same periods in 1996 primarily
due to higher unit shipments of the Company's Aura office lasers and to a lesser
extent, sales of lasers acquired in the acquisitions of HSI and NWL. Average
unit prices decreased during these periods as a combined result of the greater
shipments of lower priced Aura office laser units as well as increased shipments
to independent international distributors. The Company believes that the
continuing trend toward reduced health care costs in the United States is still
a factor which continues to impact negatively capital equipment procurement by
its hospital customers in the United States. As a result, the Company expects
that its revenue mix trends for laser equipment in the U.S. market will continue
to shift toward its lower priced Aura office laser.
The increase in revenues from the sales of instrumentation and disposable
supplies during the quarter and six months ended June 30, 1997 compared to the
corresponding periods in 1996 is principally attributable to increased shipments
of scanning devices sold as accessories to the Aura office laser system,
partially offset by lower shipments of side-firing devices which the Company
sells for use in prostate surgeries. The decreases in percentage of net revenues
were primarily the result of revenues from the sales of lasers and AMS equipment
increasing at a faster rate than revenues from the sales of instrumentation and
disposable supplies.
10
<PAGE> 11
The Company believes that acceptance of lasers in aesthetic surgery,
dermatology, urology, and ear, nose and throat surgery will continue to be
important to its business. In addition, the adoption of photodynamic therapy by
medical practitioners will be important. The Company continues to invest in
developing new instrumentation for emerging surgical applications and to educate
surgeons in the United States and internationally to encourage the adoption of
such new applications. However, there can be no assurance that such investments
will encourage adoption of the Company's products. Finally, penetration of the
international market, although increasing, has been limited.
The decrease in gross margin as a percentage of net sales during the quarter and
six months ended June 30, 1997 relative to the corresponding periods of 1996 is
due in part to revenues generated from sales of AMS products. These products
generally generate lower gross margins than product lines that the Company
manufactures. In addition, a higher proportion of revenues from sales to
independent international distributors were generated during the first half of
1997 than in the first half of 1996. These revenues generally generate lower
gross margins than those generated by revenues from sales through the Company's
direct sales force. The Company expects that gross margin as a percentage of
revenues for the remainder of 1997 may vary from quarter to quarter as it
continues to balance production volumes and inventory levels with product demand
and as product and distribution mix varies.
Research and development expenses, are the result of activities related to the
development of new laser, instrumentation and disposable products and the
enhancement of the Company's existing products. The decrease in spending as a
percentage of net revenues during the quarter and six months ended June 30, 1997
was due principally to the increase in revenues resulting from the acquisition
of HSI without comparable increases in spending on research and development. The
Company acts as a distributor for the majority of the AMS product line, and, as
such, the research and development activity required to support these products
is minimal The Company expects to increase amounts spent in research and
development on non-AMS products during 1997; however, as a percentage of total
net revenues, the Company expects these amounts to vary from quarter to quarter
as net revenues change.
The increase in selling, general and administrative expenses during the quarter
and six months ended June 30, 1997 primarily results from new personnel acquired
by the Company in the HSI acquisition. The Company expects these amounts to
remain at similar levels during the remainder of 1997 as the Company continues
to invest in international expansion, marketing programs and educational
support.
During the quarters and six months ended June 30, 1997 the Company recorded
income tax provisions representing effective tax rates of 22% and 16%,
respectively, compared to tax provisions representing effective tax rates of 12%
in each of the corresponding periods in 1996. The 1997 tax rates are higher than
the 1996 rates due to the combined effect of higher tax rates on the income
generated by NWL partially offset by lower effective rates in 1997 than in 1996
due to the impact of non-deductible acquisition related charges in 1996. Both
years' tax rates are below the combined federal and state statutory rates due to
the utilization of available net operating loss carryforwards.
11
<PAGE> 12
LIQUIDITY AND CAPITAL RESOURCES:
The following table contains selected balance sheet information which serves as
the basis of the discussion of the Company's liquidity and capital resources at
June 30, 1997 and for the six months then ended (in thousands):
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1997 1996
--------------------------
<S> <C> <C>
Cash and cash equivalents $ 1,837 $ 3,917
Total assets $52,944 $44,469
Net working capital $21,217 $18,444
</TABLE>
The net decrease in cash and cash equivalents during the six month period was
due principally to the combination of cash used by operating activities of $3.2
million, capital expenditures of $2.0 million and the $1.0 million paid for the
acquisition of a majority interest in NWL, offset by proceeds from the sale of
common stock pursuant to option exercises of $1.3 million and net short-term
bank borrowings of $2.6 million.
Significant components of cash used by operating activities included an increase
in accounts receivable of $2.4 million, an increase in inventory of $0.8 million
and decreases to accounts payable and accrued compensation of $2.0 million and
$1.0 million, respectively. The Company believes that the increase to accounts
receivable was due to longer collection cycles for sales by its international
subsidiaries, particularly in France and similarly long collection cycles for
sales to its AMS customers.
The Company anticipates that future changes in cash and working capital will be
dependent on a number of factors. As a result of the acquisitions of HSI and
NWL, the Company's Balance Sheet liquidity ratios changed and the Company's
ability to generate cash will be partially dependent on management's ability to
manage effectively non-cash assets such as inventory and accounts receivable. In
addition, the level of profitability of the Company will have a significant
impact on cash resources.
From time to time, the Company may also consider the acquisition of, or evaluate
investments in, certain products and businesses complementary to the Company's
business. Any such acquisition or investment may require additional capital
resources. The Company anticipates that current cash resources, internally
generated funds, capital and operating lease lines and available bank borrowings
will be sufficient to meet liquidity and capital needs at least through the next
twelve months. The Company financed the HSI and NWL acquisitions using its
existing cash resources. While the Company believes its remaining cash resources
will be sufficient to fund its short term operating needs, additional financing
either through its bank line of credit or otherwise will be required for the
Company's currently envisioned long term needs. There can be no assurance that
such additional financing will be available on terms acceptable to the Company,
or at all.
The Company has in place a $5.0 million revolving bank line of credit which
expires in November 1997, under which $2.6 million in borrowings were
outstanding at June 30, 1997. In addition, NWL has in place various revolving
bank lines totaling approximately $2.0 million which expire at various dates
within the next year and under which approximately $1.7 million in borrowings
were outstanding at June 30, 1997.
12
<PAGE> 13
ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is a party to a number of legal proceedings arising in the
ordinary course of business. While it is not feasible to predict or
determine the outcome of the actions brought against it, the Company
believes that the ultimate resolution of these claims will not have a
material adverse effect on its financial position or results of
operations.
ITEM 2. CHANGES IN SECURITIES
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The annual meeting of shareholders was held on June 27, 1997.
(b) The first matter voted upon at the meeting was the election of
directors and the results of that vote were as follows:
<TABLE>
<CAPTION>
Present but
For Withheld Abstained Not Voting
--- -------- --------- ----------
<S> <C> <C> <C> <C>
David Cohen 11,053,907 456,431 0 0
Klaus Goffloo 11,065,856 444,482 0 0
Benjamin L. Holmes 11,065,756 444,582 0 0
Thomas Ihlenfeldt 11,071,354 438,984 0 0
E. Walter Lange 11,071,354 438,984 0 0
Robert V. McCormick 11,071,054 439,284 0 0
Rodney Perkins, M.D. 11,021,354 488,984 0 0
Robert J. Pressley, Ph.D. 11,021,354 488,984 0 0
</TABLE>
(c) The second matter voted upon at the meeting and the results of
that vote were as follows:
<TABLE>
<CAPTION>
Present but
For Opposed Abstained Not Voting
--- ------- --------- ----------
<S> <C> <C> <C> <C>
To authorize an 9,881,046 1,574,543 52,749 2,000
amendment to the
Company's 1994 Stock
Option Plan to increase the
number of shares for issuance
thereunder by 400,000 shares to
an aggregate of 2,100,000 shares.
</TABLE>
13
<PAGE> 14
(d) The third matter voted upon at the meeting and the results of that
vote were as follows:
<TABLE>
<CAPTION>
Present but
For Opposed Abstained Not Voting
--- ------- --------- ----------
<S> <C> <C> <C> <C>
To authorize an 10,169,891 1,281,028 59,419 0
amendment to the
Company's 1989 Stock
Purchase Plan to increase the
number of shares for issuance
thereunder by 150,000 shares to
an aggregate of 600,000 shares.
</TABLE>
(e) The fourth matter voted upon at the meeting and the results of
that vote were as follows:
<TABLE>
<CAPTION>
Present but
For Opposed Abstained Not Voting
--- ------- --------- ----------
<S> <C> <C> <C> <C>
To ratify the appointment 11,227,527 250,701 32,110 0
of Ernst & Young LLP as the
independent auditors for the
Company for the fiscal year
ending December 31, 1997.
</TABLE>
ITEM 5. OTHER ITEMS
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: None
(b) Reports on Form 8-K: None
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.
LASERSCOPE
Registrant
/s/ Dennis LaLumandiere
----------------------------------------
Dennis LaLumandiere
Vice President of Finance
and Chief Financial Officer
(Principal Financial and Accounting
Officer)
Date: August 11, 1997
14
<PAGE> 15
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Exhibits
- -------- --------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 1,837
<SECURITIES> 0
<RECEIVABLES> 17,385
<ALLOWANCES> 1,725
<INVENTORY> 21,307
<CURRENT-ASSETS> 41,406
<PP&E> 17,763
<DEPRECIATION> 12,221
<TOTAL-ASSETS> 52,944
<CURRENT-LIABILITIES> 20,189
<BONDS> 1,756
0
0
<COMMON> 50,500
<OTHER-SE> (20,244)
<TOTAL-LIABILITY-AND-EQUITY> 30,256
<SALES> 30,970
<TOTAL-REVENUES> 30,970
<CGS> 16,865
<TOTAL-COSTS> 16,865
<OTHER-EXPENSES> 12,043
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24
<INCOME-PRETAX> 2,038
<INCOME-TAX> 327
<INCOME-CONTINUING> 1,711
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,637
<EPS-PRIMARY> .13
<EPS-DILUTED> .13
</TABLE>
