<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31,
1996.
___ 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 33-43537
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
(Name of small business issuer in its charter)
Nevada 56-1668867
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Glenhardie Corporate Center, 1275 Drummers Lane, Suite 201, Wayne,
Pennsylvania 19087
(address of principal executive offices) (Zip Code)
Issuer's telephone number: 610-975-9533
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 April 16, 1996.
Common Stock, Par Value $.001 10,874,745
(Class) Outstanding
Transitional Small Business Disclosure Format (check one): Yes No X
<PAGE> 2
FORM 10-QSB/A
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
INDEX
<TABLE>
<CAPTION>
<S> <C> <C>
Page
PART I. Financial Information
Item 1. Consolidated Financial Statements
Balance Sheet - March 31, 1996 (Unaudited) 2 & 3
Statements of Operations (Unaudited) - Three
Months Ended March 31, 1996 and 1995 4
Statements of Cash Flows (Unaudited) - Three
Months Ended March 31, 1996 and 1995 5
Notes to Consolidated Financial Statements
(Unaudited) 6 & 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8
PART II. Other Information 9
Signature Page 10
</TABLE>
<PAGE> 3
FORM 10-QSB/A PART I - FINANCIAL INFORMATION
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
[CAPTION]
<TABLE>
March 31, 1996
<S> <C>
Assets
Current Assets
Cash and cash equivalents $ 1,408,454
Accounts receivable, net of allowance
for doubtful accounts of $69,573 732,686
Other receivable 10,000
Inventories:
Raw materials 77,749
Work in process 21,282
Finished goods 65,776
Prepaid expenses 17,630
Costs and estimated earnings in excess
of related billings on uncompleted
contracts (Note 1) 1,504,172
Total Current Assets 3,837,749
Property and Equipment
Equipment 514,779
Molds 154,699
Furniture and fixtures 97,493
Demonstration model 158,325
925,296
Less accumulated depreciation ( 290,923)
Net Property and Equipment 634,373
Other Assets
Computer software costs 50,977
Patents, net of accumulated
amortization 117,007
Licensing agreement 64,552
Security deposit 7,772
Logo design 6,499
Other asset 2,774
Total Other Assets 249,581
Total Assets $ 4,721,703
</TABLE>
<PAGE> 4
FORM 10-QSB/A
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
[CAPTION]
<TABLE>
March 31, 1996
<S> <C>
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable $ 278,574
Billings in excess of related costs and
estimated earnings on uncompleted
contracts (Note 1) 2,970,308
Accrued salaries 41,580
Accrued expenses 3,738
Total Liabilities 3,294,200
Shareholders' Equity
Common stock, $.001 par value per
share, authorized 25,000,000 shares,
issued and outstanding 10,875,034
shares 10,875
Additional paid-in capital 7,268,527
Unearned compensation ( 57,575)
Deficit (5,794,324)
Total Shareholders' Equity 1,427,503
Total Liabilities and
Shareholders' Equity $ 4,721,703
</TABLE>
<PAGE> 5
FORM 10-QSB/A
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For Three Months
Ended March 31,
1996 1995
<S> <C> <C>
Revenue (Note 1) $ 1,771,633 $ 246,746
Cost and Expenses
Cost of revenue 1,018,369 107,534
Selling, general and
administrative 576,857 240,170
Research and development 121,785
Total Cost and Expenses 1,717,011 347,704
Income (Loss) From Operations 54,622 ( 100,958)
Other Income (Expense)
Interest and
miscellaneous income 72,929 7,742
Miscellaneous expense ( 12,491)
Total Other Income (Expense) 60,438 7,742
Net Income (Loss) $ 115,060 $( 93,216)
Net Income (Loss) Per Share $ .01 $( .02)
Weighted Average Number of Shares
Outstanding 10,856,081 4,517,565
</TABLE>
<PAGE> 6
FORM 10-QSB/A
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Cash Flows From Operating Activities
Net income (loss) $ 115,060 $( 93,216)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided By
Operating Activities
Amortization and depreciation 25,236 12,372
Changes In Operating Assets
and Liabilities
Increase in accounts receivable ( 571,454) ( 55,265)
Increase in inventories ( 44,537) ( 24,299)
Decrease (increase) in prepaid expenses 23,293 ( 15,464)
Increase in costs and estimated earnings
in excess of related billings on
uncompleted contracts (1,504,172)
Decrease in patent and other assets ( 8,314)
Increase in accounts payable and
accrued expenses 89,776 19,194
Increase in dividends payable 260,000
Increase in billings in excess of related
costs and estimated earnings on
uncompleted contracts 2,970,308 168,859
Net Cash Provided By Operating
Activities 1,095,196 272,181
Cash Flows Used In Investing Activities
Purchase of property and equipment ( 111,822) ( 264,826)
Cash Flows From Financing Activities
Decrease in loans from officer ( 10,008)
Reduction in notes payable ( 4,985)
Proceeds from issuance of
common stock 119,245 1,150,000
Net Cash Provided By Financing Activities 119,245 1,135,007
Net Increase In Cash 1,102,619 1,142,362
Beginning Cash 305,835 18,373
Ending Cash $ 1,408,454 $ 1,160,735
</TABLE>
<PAGE> 7
FORM 10-QSB/A
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies
Nature of Organization
Future Medical Technologies, Inc. ("FMT") was incorporated under
the laws of the State of New Jersey on September 28, 1989.
On January 26, 1990, West End Ventures, Inc. ("West End"),
acquired 100% of the stock of FMT. West End is a company that was
organized under the laws of the State of Nevada on August 1, 1989.
West End completed a blind pool public offering of common stock on
January 15, 1990. The Company's intent upon completion of the
offering was to seek potential businesses with which to merge or
acquire. Pursuant to the acquisition agreement, West End amended
its Certificate of Incorporation to change its name to Future
Medical Technologies International, Inc. ("FMTI" or the
"Company"), the subsidiary (FMT) retained its name. West End's
officers and directors resigned in favor of the current officers
and directors of FMT.
On February 22, 1995, the Company effected a five for seven
reverse stock split and completed the acquisition of 100% of the
stock of Covalent Research Alliance Corporation, ("CRA") a
Pennsylvania corporation, in exchange for 7,200,000 shares of post
split common stock of FMTI. CRA is a total research management
organization whose strength is in the design and management of
clinical trials in the drug and device development process and
with associated cost containment and quality of care components.
CRA specializes in cost effectiveness and outcomes studies within
major customer groups such as managed care organizations, insurers
and employers. CRA has been able to successfully deliver
customized high quality solutions to its Fortune 500 and other
clients.
Principles of Consolidation
The accompanying consolidated financial statements include the
accounts of the Company and all of its wholly owned subsidiaries.
Intercompany transactions and balances have been eliminated in
consolidation.
Cash Equivalents
For the purposes of the statement of cash flows, cash equivalents
include investments with maturities of three months or less.
Inventories
Inventories are recorded at the lower of cost, determined using
the first-in/first-out method, or market.
<PAGE> 8
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Equipment, Furniture and Fixtures
The Company records equipment, furniture and fixtures at cost.
Depreciation is provided using straight line and accelerated
methods over the useful lives of the assets, which range from two
to seven years.
Revenue Recognition
The Company recognizes revenue using the accrual method of
accounting whereby it records revenue at the time a sale has been
made and the product shipped or services performed. In addition,
long term contract revenues are recognized under the
percentage-of-completion method based on the ratio of costs
incurred to date on the contract to total estimated contract costs
after providing for all known or anticipated losses. Costs
include direct and subcontract labor and applicable overhead
expenses. Cost estimates are reviewed periodically as the work
progresses and adjustments to revenue are reflected in the period
in which revisions to such estimates are deemed appropriate. All
anticipated losses are recognized immediately. Costs and
estimated earnings in excess of billings on uncompleted contracts,
as reflected in the balance sheet, comprise amounts of revenue
recognized on contracts for which billings have not been rendered.
Billings in excess of cost and estimated earnings on uncompleted
contracts comprise amounts of billings recognized on contracts
for which costs have not been incurred.
Basis of Presentation
The financial statements for the three months ended March 31, 1996
have been prepared without audit and, in the opinion of
management, reflect all adjustments necessary (consisting only of
normal recurring adjustments) to present fairly the Company's
financial position at March 31, 1996 and the results of its
operations and its cash flows for the interim and cumulative
periods presented. Such financial statements do not include all
of the information and footnotes required by generally accepted
accounting principles for complete financial statements. For
further information, refer to the financial statements and
footnotes thereto included in the Company's annual report on Form
10-KSB for the year ended December 31, 1995.
Operating results for the three months ended March 31, 1996 are
not necessarily indicative of the results for the year ending
December 31, 1996.
2. Common Stock
Shares of common stock issued for consulting services have been
valued at various prices depending on the date of issuance.
Consultants have been issued shares approximately equivalent to
the fair value of the services received in exchange.
<PAGE> 9
On February 22, 1995 in accordance with the acquisition agreement
with CRA, a 5 for 7 reverse split occurred.
3. Proforma Information
On February 22, 1995, FMTI completed the acquisition of 100% of
the stock of CRA. Below is proforma information for the three
months ended March 31, 1995:
<TABLE>
<CAPTION>
<S> <C>
Revenue $ 1,741,992
Net Loss $( 228,376)
Net Loss Per Share $( .03)
</TABLE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION
AND RESULTS OF OPERATIONS
Three Month Period Ended March 31, 1996 Compared To The Three Month
Period Ended March 31, 1995.
During the three month period ended March 31, 1996, revenues were
$1,771,633 compared to revenues of $245,746 for the three months ended
March 31, 1995. Revenues to date have been derived primarily from CRA
contracted clinical research. The increase in revenues is a result of
significant new contracts obtained by CRA.
The cost of revenue during the three month period ended March 31, 1996
was $1,018,369 compared to $107,534 for the three month period ended
March 1995. The increase of cost was due to the increase of producing
such revenue primarily from CRA.
All other costs incurred during the three month period ended March 31,
1996, including selling, general and administrative expenses and
research and development, were $698,642. By comparison, those same
costs incurred during the three month period ended March 31, 1995 were
$240,120. The increase in operating expenses is primarily a result of
CRA increased activity and ongoing research and development of voice
recognition software.
The net income realized by the Company during the three month period
ended March 31, 1996 was $115,060. The net loss realized in the three
months period ended March 31, 1995 was $93,216. The increase in
income was due to the above factors.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash balance at March 31, 1996 was $1,408,454 compared
to $1,160,735 at March 31, 1995. The Company has financed its
operations primarily through sales of its stock and experienced net
income for the quarter ended March 31, 1996.
Accounts receivable increased to $732,686 at March 31, 1996 compared
to $98,394 at March 31, 1995. The increase is attributable to several
significant new contracts obtained by CRA in 1996.
<PAGE> 10
The Company purchased $288,910 in fixed assets, primarily equipment,
from March 31, 1995 to 1996, mainly to support increased CRA activity.
Working capital remained relatively constant from March 31, 1995, at
$513,457, to March 31, 1996, at $543,549. At March 31, 1996 current
liabilities included approximately $2,970,308 of contract billings which
had been received by the Company. These contracts billings relate to long
term contracts which are being recognized under the percentage of completion
method and will be recorded as contract revenue as work progresses on the
individual contracts. Therefore, the Company believes that it has a strong
position at this time. The Company is currently exploring several alternatives
to raise additional capital, if necessary, for NASDAQ qualification.
<PAGE> 11
FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC. AND SUBSIDIARIES
PART II. OTHER INFORMATION
ITEM 1. Legal Proceeding:
None.
ITEM 2. Changes in Securities:
None.
ITEM 3. Defaults Upon Senior Securities:
None.
ITEM 4. Submission of Matters to a Vote of Security
Holders:
None.
ITEM 5. Other Information:
None
ITEM 6. Exhibits and Reports on Form 8-K:
None
<PAGE> 12
SIGNATURES
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.
FUTURE MEDICAL TECHNOLOGIES
INTERNATIONAL, INC.
Dated: May 9, 1996 By: /s/Bruce LaMont
----------------------------
Bruce LaMont, President
and Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000856569
<NAME> FUTURE MEDICAL TECHNOLOGIES INTERNATIONAL, INC.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 1,408,454
<SECURITIES> 0
<RECEIVABLES> 802,259
<ALLOWANCES> (69,573)
<INVENTORY> 164,807
<CURRENT-ASSETS> 3,837,749
<PP&E> 925,296
<DEPRECIATION> (290,923)
<TOTAL-ASSETS> 4,721,703
<CURRENT-LIABILITIES> 3,294,200
<BONDS> 0
0
0
<COMMON> 10,875
<OTHER-SE> 1,639,010
<TOTAL-LIABILITY-AND-EQUITY> 4,721,703
<SALES> 1,771,633
<TOTAL-REVENUES> 1,771,633
<CGS> 1,018,369
<TOTAL-COSTS> 1,717,011
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 54,622
<INCOME-TAX> 0
<INCOME-CONTINUING> 115,060
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 115,060
<EPS-PRIMARY> .01
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</TABLE>
