UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended: September 30, 1996 Commission File Number: 33-37418
DIAGNOSTIC IMAGING SERVICES, INC.
(Exact name of registrant as specified in charter)
Delaware 33-0443404
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1516 Cotner Avenue
Los Angeles, California 90025
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (310) 479-0399
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 of 15(d) of the Securities and 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 No X
Number of shares outstanding of the issuer's common stock as of June 12, 1997
was 11,310,110.
Transitional Small Business Disclosure Format. Yes No X
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
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CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 30, 1996.
(UNAUDITED)
- ------------------------------------------------------------------------------
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Assets:
Current Assets:
Cash $ 5,841
Accounts Receivable - Net 5,677,939
Other Current Assets 392,748
Net Assets Held for Divestiture 29,317
-----------
Total Current Assets 6,105,845
Property, Plant and Equipment - Net 21,618,316
-----------
Other Assets:
Accounts Receivable - Net 316,102
Goodwill - Net 7,146,759
Other Intangibles - Net 1,663,675
Other Assets 561,372
-----------
Total Other Assets 9,687,908
Total Assets $37,412,069
See Notes to Consolidated Financial Statements.
1
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
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CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 30, 1996.
(UNAUDITED)
- ------------------------------------------------------------------------------
<S> <C>
Liabilities and Shareholders' Deficit:
Current Liabilities:
Cash Overdraft $ 659,406
Accounts Payable 1,498,650
Accrued Expenses 3,447,316
Accrued Professional Fees 1,409,207
Due to Related Parties 1,884,618
Notes Payable and Capital Leases 11,779,446
-----------
Total Current Liabilities 20,678,643
Long-Term Liabilities:
Notes Payable and Capital Leases 18,393,154
Accrued Professional Fees 78,453
Total Long-Term Liabilities 18,471,607
Minority Interest --
Commitments and Contingencies --
Shareholders' Deficit:
Preferred Stock - Series F, $.01 Par Value, 5,000,000
Shares Authorized, 2,482,000 Shares Issued and Outstanding,
Stated Liquidation Preference of $2,482,000 24,820
Preferred Stock - Series G, $.01 Par Value, 5,000,000
Shares Authorized, 2,000,000 Shares Issued and Outstanding,
Stated Liquidation Preference of $2,000,000 20,000
Common Stock - $.01 Par Value, 20,000,000 Shares Authorized;
11,463,956 Shares Issued; and 11,310,110 Shares Outstanding 114,639
Additional Paid-in Capital - Common Stock 4,251,059
Additional Paid-in Capital - Preferred Stock - Series F 226,409
- - Additional Paid-in Capital - Preferred Stock - Series G 182,441
Stock Purchase Warrants 1,175,317
Deferred Compensation (790,901)
Subscriptions Receivable (10,994)
Accumulated Deficit (6,929,433)
Treasury Stock - 153,846 Shares of Common Stock - At Cost (1,538)
-----------
Total Shareholders' Deficit (1,738,181)
Total Liabilities and Shareholders' Deficit $37,412,069
See Notes to Consolidated Financial Statements.
2
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
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CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
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Nine months ended
September 30,
1 9 9 6 1 9 9 5
------- -------
<S> <C> <C>
Revenue:
Net Patient Service Revenue $17,017,250 $21,461,468
----------- -----------
Expenses:
Cost of Services 12,823,365 15,111,633
General and Administrative 2,646,789 867,719
Depreciation and Amortization 2,932,609 2,999,071
(Gain) Loss on Sale or Divestiture (514,631) --
---------- -----------
Total Expenses 17,888,132 18,978,423
---------- -----------
Operating (Loss) Income (870,882) 2,483,045
Interest Expense (2,664,710) (2,682,598)
---------- -----------
Loss Before Income Taxes and Minority Interest in
Loss of Subsidiaries (3,535,592) (199,553)
Income Tax Provision -- --
Minority Interest in Loss of Subsidiaries 64,208 48,353
---------- -----------
Net Loss $(3,471,384) $ (151,200)
=========== ===========
Net Loss Per Share $ (.33) $ (.04)
========== ===========
Weighted Common Shares Outstanding 10,464,728 8,585,054
========== ===========
See Notes to Consolidated Financial Statements.
3
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
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CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
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Nine months ended
September 30,
1 9 9 6 1 9 9 5
------- -------
<S> <C> <C>
Net Cash - Operating Activities $ 97,511 $ 749,201
---------- -----------
Investing Activities:
Purchase of Property, Plant and Equipment (139,207) (2,514,665)
Acquisitions of Operating Entities (200,000) (890,000)
Proceeds from Sales of Divisions 1,028,000 --
Payments for Intangible Assets (50,633) (449,276)
Payments for Deposits and Other Assets (222,012) (490,847)
---------- -----------
Net Cash - Investing Activities 416,148 (4,344,788)
---------- -----------
Financing Activities:
Cash Overdraft 659,406 --
Proceeds from Borrowings on Notes Payable 1,571,775 7,075,154
Principal Payments on Notes and Leases (7,452,110) (5,379,472)
Proceeds from the Issuance of Common Stock 3,000,000 1,688,405
Loans from Related Parties 1,769,325 211,500
Payments to Related Parties (21,707) --
Payments to Joint Ventures Partners (52,500) --
---------- -----------
Net Cash - Financing Activities (525,811) 3,595,587
---------- -----------
Net Decrease in Cash (12,152) --
Cash - Beginning of Periods 17,993 --
---------- -----------
Cash - End of Periods $ 5,841 $ --
========== ===========
Supplemental Disclosures of Cash Flow Information:
Cash paid during the periods for:
Interest $3,034,977 $ 2,304,156
</TABLE>
Supplemental Schedule of Noncash Investing and Financing Activities:
The Company entered into capital leases of $1,316,110 in the nine months ended
September 30, 1996.
During the nine months ended September 30, 1996, the Company acquired medical
equipment of approximately $395,000 as part of the Healthcare Imaging Center
acquisition along with the assumption of notes payable of $160,000, and accounts
payable and accrued expenses of $44,575 thereon.
The Company converted accrued maintenance costs with two outside vendors into
various notes payable totaling approximately $510,000 during the nine months
ended September 30, 1996.
See Notes to Consolidated Financial Statements.
4
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
- ------------------------------------------------------------------------------
(1) Summary of Significant Accounting Policies
Significant accounting policies of Diagnostic Imaging Services, Inc. and
affiliates are set forth in the Company's Form 10-KSB for the year ended
December 31, 1995 as filed with the Securities and Exchange Commission.
(2) Basis of Presentation
The accompanying interim consolidated financial statements are unaudited and
have been prepared in accordance with generally accepted accounting principles
and the instructions to Form 10-QSB and Rule 10-01 of Regulation S-X and ,
therefore, do not include all information and footnotes necessary for a fair
presentation of financial position, results of operations and cash flows in
conformity with generally accepted accounting principles for complete financial
statements; however, in the opinion of the management of the Company, all
adjustments consisting of normal recurring adjustments necessary for a fair
presentation of financial position, results of operations and cash flows for the
interim periods ended September 30, 1996 and 1995 have been made. The results of
operations for any interim period are not necessarily indicative of the results
for the full year. These interim consolidated financial statements should be
read in conjunction with the consolidated financial statements and notes thereto
contained in the Company's annual report on Form 10-KSB for the fiscal year
ended December 31, 1995.
(3) Intangible Assets
The Company's goodwill of $8,161,632 as of September 30, 1996 is shown net of
accumulated amortization of $1,014,873. Amortization expense for the nine months
ended September 30, 1996 was approximately $320,000.
Other Intangible Assets consist primarily of covenants not to compete,
capitalized loan fees and organization costs. The Company's covenants not to
compete of $2,005,196 as of September 30, 1996 are shown net of accumulated
amortization of $1,141,469. Amortization expense for the nine months ended
September 30, 1996 was approximately $295,000. Organization Costs and
Capitalized Loan Fees of $1,083,867 are shown net of accumulated amortization of
$283,919. Amortization expense for the nine months ended September 30, 1996 was
approximately $125,000.
(4) Due to Related Parties
At September 30, 1996, DIS owed approximately $1,770,000 to Primedex Health
Systems, Inc. ("PHS") as summarized by the following:
In March 1996, PHS loaned $1,000,000 to DIS pursuant to a revolving loan
agreement. The loan bears interest at the prime rate, as quoted by Bank of
America, plus four percent. Principal payments are to commence October 1996 at
the rate of $50,000 per month plus interest. All unpaid amounts are due on March
22, 2001. During 1996, PHS loaned DIS approximately $345,000 in additional
non-interest bearing short-term working capital loans and accrued interest.
DIS entered into an agreement with PHS, whereby PHS will provide management
services to DIS for a monthly fee of $45,000. During March and April 1996, the
Company was charged a management fee of approximately $100,00 per month.
Additionally, DIS and PHS entered into a second agreement which is being phased
in on a center by center basis which provides for PHS to supply transcription
services, patient scheduling, and billing and collection services. DIS will pay
an amount equal to 10% of its collections for each covered center. During 1996,
DIS incurred $425,000 in management fees. The agreements expire April 1, 2001
with an option to renew for an additional year.
As of December 31, 1995, the Company owed an officer of the Company
approximately $137,000 for prior net loans made by him to the Company. During
the nine months ended September 30, 1996, the Company repaid approximately
$22,000 of these loans.
5
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED), Sheet #2
- ------------------------------------------------------------------------------
(5) Acquisitions and Divestitures
On March 1, 1996, the assets and related liabilities of Mission Bay Mobile MRI
Facility L.P. ("MBM") were assumed by Mobile Technology, Inc.. The transfer
resulted in a gain of approximately $296,000. On April 1, 1996, substantially
all of the assets and liabilities of the nuclear medicine business at North
County were sold to Tri-City Hospital District for $230,000. The sale resulted
in a net loss of $147,093 of which a $220,607 loss was recorded at December 31,
1995 and the difference of $73,444 was recorded in 1996.
During 1996, the Company rented its PPS "Montclair" mobile unit to a hospital
with the expectation of eventually selling the unit to the hospital. On April
30, 1996, the hospital terminated its rental agreement and the Company reclaimed
the unit and set-up an additional loss reserve of approximately $119,000 with
the intention of selling the unit by year-end. The unit was temporarily moved to
Scripps Chula Vista as a replacement for a rental unit previously used at that
site. Approximately $30,000 remains in assets held for divestiture for the
Company's PPS mobile unit.
(6) Sale of Stock and Securities
On March 25, 1996, PHS purchased 2,747,493 shares of the Company's common stock
from the Company with a 5-year warrant to acquire an additional 1,521,739 shares
of the Company's common stock at $1.60 per share for $3,000,000 and the
establishment of a five year $1,000,000 revolving loan with DIS. In addition,
PHS purchased 730,768 shares of common stock from DVI Financial Services, Inc.
for $1,000,000, giving PHS approximately 31% ownership of the Company. In August
1996, PHS purchased an additional 3,228,046 shares of DIS common stock from
various related and unrelated parties for $3,252,046 increasing its ownership to
6,706,307 shares, or approximately 59% (excluding shares on exercise of the
warrant).
PHS is a publicly traded, New York corporation organized in 1985 and principally
engaged in the health care services industry through its wholly-owned
subsidiaries, Radnet Management, Inc. and Future Diagnostics, Inc.. Radnet owns
and operates 17 medical imaging centers and is a joint venture partner in two
other imaging centers. Future Diagnostics, Inc. arranges for the provision of
imaging services throughout California via a network of more than 180 contracted
imaging centers, which, in turn provide quality diagnostic imaging services to
insurance companies, health plans and other payors. Additionally, FDI provides a
broad array of healthcare management services to its contracted centers and to
others including utilization review, physician credentialing and financial
information systems services.
(7) Litigation
On April 10, 1996, the Company was served with a complaint entitled Midway
Hospital Medical Center v. Diagnostic Imaging Services, Inc. filed in the U.S.
District Court, Central District of California seeking payment of $116,056 plus
attorney's fees based upon the alleged failure of the Company to discharge
medical bills of a Company employee covered under the Company's health insurance
program. The Company then commenced legal action against the Company's outside
administrator of its health insurance program alleging that it failed to
properly administer that program and that if there is any liability to Midway,
it is the liability of the administrator. The administrator denied any liability
and filed a counterclaim against the Company alleging that it is owed $141,658,
which the Company denied. The Company has settled the action with regard to the
claim of Midway Hospital Medical Center for approximately $60,000 and as to the
counterclaim of the administrator for approximately $95,000.
The Company is currently party to other litigation, none of which is deemed by
management to be material in nature.
. . . . . . . . .
6
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
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Background
Diagnostic Imaging Services, Inc. ("DIS" or the "Company") was incorporated in
California as an S- Corporation on June 27, 1986. In 1992, the Company's
consolidated operations consisted of non-invasive diagnostic imaging services,
primarily with the use of ultrasound technology ("Ultrasound Division"). During
1992 and 1993, DIS established one mobile MRI business and was the general
partner of four limited partnerships that provided diagnostic imaging services:
San Gabriel Valley Magnetic Resonance Imaging Center ("SGV"), Tarzana Regional
Medical Center Magnetic Resonance Imaging Center ("Tarzana"), Inland Community
Magnetic Resonance Imaging Center ("Inland") and Temecula Valley Imaging Center
("Temecula"). DIS also provided management services for these entities.
In June 1993, DIS became the general partner and 70% owner of Mission Bay Mobile
MRI Facility, L.P. ("MBM"). In March 1996, MBM's assets and liabilities were
assumed by an unaffiliated third party; the transfer resulted in a gain of
approximately $296,000. In December 1993, Norman Hames, President and Chief
Financial Officer of DIS, assigned his shares in a privately held company,
Diagnostic Imaging Services, Inc. ("Diagnostic") to a newly established
corporation, DIS Imaging, Inc., of which he was the sole shareholder. In January
1994, DIS Imaging, Inc. purchased the shares held by the then majority
shareholder of Diagnostic and all of his interests in certain partnerships which
Diagnostic managed.
During the months of January and February 1994, DIS purchased the remaining
limited partnership units of Tarzana, SGV and Inland. Additionally, in February
1994, DIS purchased the assets of two freestanding multi-modality imaging
centers: Thousand Oaks Medical Diagnostic Imaging ("MDI") and Parkside Radiology
("Parkside"). In April 1994, DIS opened Valley Regional Oncology Center, Ltd.,
L.P. ("VROC"), a cancer care therapy center located in Temecula, California. DIS
is the general partner and 75% owner of VROC. On September 2, 1994, DIS merged
its operations with IPS Health Care, Inc. pursuant to an Agreement and Plan of
Reorganization and an Agreement for the Exchange of Stock and Assets (see
Company's Form 10-K for the year ended December 31, 1994). The Company's name
was then changed to Diagnostic Imaging Services, Inc.. On September 22, 1994,
DIS purchased the assets of North County MRI and North County Mediscan ("North
County" collectively). The nuclear medicine business of North County Mediscan
was subsequently sold for $230,000 in June 1996.
In January 1995, DIS assumed ownership of West Los Angeles MRI ("WLA"). In the
first quarter of 1995, Inland was relocated from Montclair to Chino, California
("Chino"). During this time, the center was closed for approximately two months.
In February 1995, DIS purchased the outstanding limited partnership units of
Santa Monica Imaging Center ("SMIC") and became its general partner. In August
1995, DIS purchased the assets of an X-Ray, mammography, and basic ultrasound
center in Murrieta, California ("Murrieta").
On March 25, 1996, DIS issued 2,747,493 shares of its common stock (with a
five-year warrant to purchase an additional 1,521,739 shares of common stock at
$1.60 per share) to Primedex Health Systems, Inc. ("PHS") for $3,000,000 and the
establishment of a five-year revolving $1,000,000 line of credit for DIS. PHS is
a publicly-traded New York corporation organized in 1985 and is principally
engaged in the healthcare services industry in California. DIS also entered into
two five-year management service agreements with PHS. The first agreement
relates to DIS's overall corporate operations and provides that PHS will provide
for all office maintenance for the DIS facilities, administer its personnel
program, bookkeeping and payroll services as well as certain of its accounting
services. In addition, PHS provides advice to DIS with regard to its
accreditation program and negotiates on behalf of DIS for equipment, supplies,
service and insurance. DIS agreed to pay $45,000 per month for these services.
Additionally, DIS entered into a second agreement which will be phased in on a
center by center basis which provides for PHS to supply transcription services,
patient scheduling, billing and collection services. All costs of equipment and
training are the responsibility of PHS. DIS will pay PHS an amount equal to 10%
of its collections from each covered center for such services.
7
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
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Background (Continued)
As of September 30, 1996, through various transactions with related and
unrelated parties, PHS acquired an additional 3,228,046 shares of DIS common
stock bringing its total ownership to 6,706,307 shares, or approximately 59%.
In May 1996, Integrated Cardiovascular Systems, Inc. ("ICVS") was sold to an
unaffiliated third party for $798,000 resulting in a gain of approximately
$313,000. In addition, the Company also consolidated SMIC's non-MRI business
with Parkside during the month. In August 1996, DIS acquired the assets and
liabilities of HealthCare Imaging Center ("HCI") in Riverside, California for
$200,000 resulting in goodwill of $10,000. In September 1996, DIS opened the
Camarillo Imaging Center ("Camarillo"), a start-up operation utilizing equipment
transferred from other sites.
Discussion of Operations for the Nine Months Ended September 30,
1996 vs. September 30, 1995
The following discussion relates to the continuing activities of Diagnostic
Imaging Services, Inc..
Results of Operations
For the nine months ended September 30, 1996, the Company had a loss from
operations of $870,882. For the nine months ended September 30, 1995, the
Company had operating income of $2,483,045. Net revenue was $17,017,250 and
$21,461,468 for the nine months ended September 30, 1996 and 1995, respectively.
The decrease in net revenue was primarily attributable the sale of MBM, ICVS and
the nuclear medicine business at North County, the downsizing of SMIC and
increased contractual adjustments on accounts receivable.
Total expenses were $17,888,132 and $18,978,423 for the nine months ended
September 30, 1996 and 1995, respectively. The primary increase was in general
and administrative expenses which increased from $867,719 to $2,646,789 in the
nine months ended September 30, 1995 and 1996, respectively. In 1996, billing
and management fees increased approximately $500,000 with the agreement with
PHS, corporate salaries increased approximately $150,000, medical supplies
increased approximately $650,000 with the loss of rebates and purchase credits,
outside services increased approximately $210,000 for legal and accounting fees
and the Company wrote-off an employment contract for approximately $120,000.
For the nine months ended September 30, 1996 and 1995, interest expense was
$2,664,710 and $2,682,598, respectively. Interest expense was primarily
attributable to equipment financing and lines of credit charges.
For the nine months ended September 30, 1996 and 1995, the Company had a net
loss of $3,471,384 and $151,200, respectively.
8
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
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Liquidity and Capital Resources
Cash decreased for the nine months ended September 30, 1996 and 1995 by $12,152
and $-0-, respectively.
Cash generated from investing activities for the nine months ended September 30,
1996 was $416,148. Cash utilized for investing activities for the nine months
ended September 30, 1995 was $4,344,788. In the nine months ended September 30,
1995, the Company acquired substantially all of the partnership interests of
Santa Monica Imaging center for $670,000 in cash and purchased certain assets of
Golden Triangle Radiology and Medical Group Imaging, Inc. ("Murrieta") for
$220,000 in cash. In the nine months ended September 30, 1996, the Company
acquired the assets and liabilities of HealthCare Imaging Center ("HCI") for
$200,000 in cash and generated proceeds from the sales of ICVS and the nuclear
medicine business at North County of $1,028,000. In addition, the Company
purchased property and equipment and other assets of approximately $410,000 and
$3,450,000 for the nine months ended September 30, 1996 and 1995, respectively.
Cash utilized for financing activities for the nine months ended September 30,
1996 was $525,811. Cash generated from financing activities for the nine months
ended September 30, 1995 was $3,595,587. For the nine months ended September 30,
1996, $7,452,110 was made in debt and lease payments, approximately $1,770,000
was borrowed from related parties, approximately $1,570,000 was borrowed from
notes payable, $3,000,000 in proceeds were received from the sale of common
stock to PHS, and the Company had a cash overdraft of approximately $660,000.
For the nine months ended September 30, 1995, $5,379,472 was made in debt and
lease payments, $7,075,154 was advanced from borrowings on notes payable and
approximately $1,690,000 in proceeds were received from the sale or conversion
of debt into common stock.
At September 30, 1996, the Company had a net working capital deficit of
$14,572,798, a decrease of $4,681,515 from December 31, 1995. A key reason for
the decrease was the reclassification of the Company's lines of credit as
current liabilities. Approximately $4,250,000 and $8,000,000 was outstanding
under the Company's lines of credit at September 30, 1996 and December 31, 1995,
respectively. In 1996, DIS reduced its outstanding lines by $3,000,000 with the
proceeds from the sale of common stock to PHS.
In June 1994, the Company entered into a $2,500,000 revolving term note ("A")
agreement with a financial institution, which, at the time, was also a
shareholder of the Company, to replace a previous line of credit agreement dated
January 1994. Revolving term note "A" is collateralized by all eligible accounts
receivable as defined in the agreement. In August 1994, the maximum level of
borrowings was increased to $3,500,000 and in June 1995, increased to
$4,000,000. During 1995 the amount outstanding has, from time to time, exceeded
maximum borrowings available under the agreement. In September 1995, the company
entered into a second $4,000,000 revolving term note ("B") agreement with the
same financial institution. Revolving note "B" is collateralized by
substantially all of the Company's assets.
Under revolving note "A", due June 1997, the Company may borrow approximately
53% of the eligible accounts receivable, to a maximum of $4,000,000. Borrowing
under this line are repayable with interest at an annual rate of the prime rate
plus 3-1/2%, payable monthly. At September 30, 1996, approximately $3,875,000
was outstanding under this line. The revolving term note "B" matures in
September 1997 and bears interest at the prime rate plus 3-1/2% for borrowings
under this agreement up to $2,000,000 and plus 10% for any borrowings exceeding
$2,000,000 payable monthly. At September 30, 1996, approximately $380,000 was
outstanding under this line.
9
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- ------------------------------------------------------------------------------
Liquidity and Capital Resources (Continued)
The Company's future payments for debt and equipment under capital leases for
the next five years, assuming lines of credit are paid and not renewed, will be
approximately $14,840,000, $6,415,000, $6,190,000, $5,600,000 and $3,770,000,
respectively. The September 30, 1996 lines of credit balances were approximately
$4,250,000. Interest expense (assuming lines of credit are paid in full) for the
Company for the next five years, included in the above payments, will be
approximately $3,060,000, $1,840,000. $1,310,000. $725,000 and $275,000,
respectively.
10
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DIAGNOSTIC IMAGING SERVICES, INC. AND AFFILIATES
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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.
Diagnostic Imaging Services, Inc. and Affiliates
(Registrant)
August 18, 1997 By: /s/ Norman Hames
------------------
Norman Hames, President, Principal
Executive Officer and Director
11
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated balance sheet and the consolidated statement of operations filed
as part of the quarterly report on Form 10-Q and is qualified in its entirety
by reference to such quarterly report on Form 10-Q.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 5,841
<SECURITIES> 0
<RECEIVABLES> 5,667,939
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 6,105,845
<PP&E> 21,618,316
<DEPRECIATION> 0
<TOTAL-ASSETS> 37,412,069
<CURRENT-LIABILITIES> 20,678,643
<BONDS> 0
0
44,820
<COMMON> 114,639
<OTHER-SE> (1,897,640)
<TOTAL-LIABILITY-AND-EQUITY> 37,412,069
<SALES> 17,015,250
<TOTAL-REVENUES> 17,015,250
<CGS> 12,823,365
<TOTAL-COSTS> 5,064,767
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,664,710
<INCOME-PRETAX> (3,471,384)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,471,384)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,471,384)
<EPS-PRIMARY> (.33)
<EPS-DILUTED> (.33)
</TABLE>
