<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/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 JUNE 30, 1996.
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: 1-11150
UROHEALTH SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 98-0122944
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5 CIVIC PLAZA SUITE 100, NEWPORT BEACH, CALIFORNIA 92660
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code: (714) 668-5858
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 than 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 Common Stock outstanding as of July 31, 1996
was 14,659,962.
<PAGE> 2
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Condensed Consolidated Balance Sheets at June 30, 1996 and
March 31, 1996 3
Condensed Consolidated Statements of Operations for the Three
Months Ended June 30, 1996 and June 30, 1995 4
Condensed Consolidated Statements of Cash Flows for the Three
Months Ended June 30, 1996 and June 30, 1995 5
Notes to the Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 12
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 6. Exhibits and Reports on Form 8-K 13
</TABLE>
<PAGE> 3
UROHEALTH SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except par value data)
<TABLE>
<CAPTION>
June 30 March 31
1996 1996
-------- --------
(unaudited)
<S> <C> <C>
ASSETS
Current Assets :
Cash and equivalents $ 3,603 $ 1,185
Receivables, net of allowance for doubtful accounts of $1,512
and $1,644 on June 30, 1996 and March 31, 1996, respectively 11,113 7,337
Inventories 8,991 5,705
Prepaids and deposits 2,063 1,685
Deferred debt issuance costs -- 614
-------- --------
Total current assets 25,770 16,526
Property and equipment, net 11,598 8,132
Patents and intangibles, net of accumulated amortization of $2,212
and $2,102 on June 30, 1996 and March 31, 1996, respectively 4,581 2,135
Deposits and other assets 867 649
Deferred debt issuance costs 4,940 --
Goodwill, net 7,240 393
-------- --------
$ 54,996 $ 27,835
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 10,298 $ 9,455
Restructuring accrual 645 1,345
Compensation and employee benefits 2,141 2,045
Revolving lines of credit -- 7,123
Current portion of notes payable and capital leases 872 286
-------- --------
Total current liabilities 13,956 20,254
Long-term liabilities:
Notes payable 65 641
Bank term loan -- 6,000
Capital leases 181 211
Convertible note -- 1,284
Deferred compensation 28 28
Other liabilities 256 157
Restructuring accrual, less current portion 797 823
Minority interest in consolidated subsidiary 1,090 1,073
Redeemable convertible preferred stock -- 3,554
Convertible subordinated debentures 34,300 --
Common Stockholders' Equity :
Preferred stock, $.001 par value
Authorized shares - 5,000,000
Issued and outstanding shares - none -- --
Common stock - $0.001 par value
Authorized - 20,000,000, Issued and outstanding - 14,355,066
and 12,460,000, respectively 14 12
Warrants 5,217 2,922
Additional paid-in capital 65,367 55,050
Deficit (66,187) (64,076)
Foreign currency adjustment (88) (98)
-------- --------
Total common stockholders' (deficit) equity 4,323 (6,190)
-------- --------
$ 54,996 $ 27,835
======== ========
</TABLE>
See accompanying notes.
3
<PAGE> 4
UROHEALTH SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except for per share amounts)
<TABLE>
<CAPTION>
Three Months Ended
June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
Net sales $ 16,892 $ 12,707
Cost of sales 5,257 4,276
-------- --------
Gross profit 11,635 8,431
Operating expenses:
Selling, general and administrative 9,106 9,597
Research and development 343 547
Merger and acquisition costs -- 851
-------- --------
Total operating expenses 9,449 10,995
Income (loss) from operations 2,186 (2,564)
Other income (expense):
Minority interest consisting of accrued dividends
on preferred stock of subsidiary (18) (15)
Interest income 51 44
Interest expense (961) (95)
Other -- (62)
-------- --------
Net income (loss) before tax and extraordinary item 1,258 (2,692)
Provision for income tax -- 317
-------- --------
Net income (loss) before extraordinary item 1,258 (3,009)
Extraordinary item (early extinguishment of debt) (2,973) --
-------- --------
Net loss $ (1,715) $ (3,009)
======== ========
Net loss per share:
Net loss $ (1,715) $ (3,009)
Dividends and accretion on redeemable
convertible preferred stock 398 45
-------- --------
Net loss attributable to common stockholders $ (2,113) $ (3,054)
======== ========
Income (loss) per share before extraordinary item $ 0.06 $ (0.27)
Loss per share, extraordinary item (0.22) --
-------- --------
Net loss per share $ (0.16) $ (0.27)
======== ========
Weighted average number of common shares used
to compute loss per share 13,442 11,473
======== ========
</TABLE>
See accompanying notes.
4
<PAGE> 5
UROHEALTH SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, dollars in thousands)
<TABLE>
<CAPTION>
Three Months Ended
June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
Cash flows from operating activities:
Net profit (loss) $ (1,715) $ (3,009)
Non cash items included in net loss:
Extraordinary expense 2,433 --
Depreciation and amortization 511 501
Deferred debt issue costs 271 --
Accretion and accrued interest on convertible note 42 22
Accrued dividend on preferred stock in subsidiary 17
Loss on disposition of fixed asset -- 31
Provision for doubtful accounts (200) --
Other 10 55
Changes in operating assets:
Receivables (2,984) (1,370)
Inventories (2,714) (124)
Prepaids and deposits (597) 528
Changes in operating liabilities:
Accounts payable and accrued expenses (1,872) 991
Compensation and employee benefits 96 18
Accrued dividend on preferred stock of subsidiary -- 44
Other liabilities (26) --
Accrued restructuring charges (726) (42)
-------- --------
Net cash used in operating activities (7,454) (2,355)
Cash flows from investing activities:
Purchase of property and equipment, net (3,584) (870)
Purchase of patents, net (56) (12)
Asset purchase from O. R. Concepts (2,784) --
Proceeds from sale of investments -- 579
Deposits and other assets -- 14
Other -- (10)
-------- --------
Net cash used in investing activities (6,424) (299)
Cash flows from financing activities:
Deferred financing fees paid (4,828) --
Issuance of common stock 787 28
Issuance of redeemable convertible preferred stock -- 1,500
Proceeds from note payable -- 375
Repayments on revolving line of credit (7,323) 965
Repayments on bank term loan (6,000) --
Proceeds from redeemable convertible debentures 34,300 --
Principal payments on capital leases and notes payable (640) (137)
-------- --------
Net cash provided by financing activities 16,296 2,731
-------- --------
Net (decrease) increase in cash 2,418 (77)
Cash, beginning of period 1,185 1,331
-------- --------
Cash, end of period $ 3,603 $ 1,405
======== ========
Supplemental cash flow information:
Cash paid for interest $ 313 $ 136
======== ========
Non-cash transaction:
Warrant issuance in connection with sale of
convertible subordinated debentures $ 1,415 $ --
======== ========
</TABLE>
See accompanying notes.
5
<PAGE> 6
UROHEALTH SYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
1. INTERIM REPORTING
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements are
prepared in accordance with generally accepted accounting principles (GAAP) and
include the accounts of Urohealth Systems, Inc. (the "Company") and its
subsidiaries. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with GAAP have been condensed or
omitted pursuant to the rules and regulations of the Securities and Exchange
Commission. The condensed consolidated financial statements have been restated
to reflect business combinations accounted for using the pooling of interests
method.
In the opinion of management, the accompanying unaudited condensed consolidated
financial statements contain all adjustments necessary to present fairly the
Company's condensed consolidated financial position as of June 30, 1996 and
March 31, 1996, its condensed consolidated results of operations for the three
month periods ended June 30, 1996 and June 30, 1995, and its condensed
consolidated cash flows for the three month periods ended June 30, 1996 and June
30, 1995. Adjustments consist of normal recurring accruals except for the
extraordinary loss on early retirement of debt and the merger and acquisition
costs identified in the accompanying unaudited condensed consolidated
statements of operations. The results of operations for the three month period
ended June 30, 1996 are not necessarily indicative of those to be expected for
the entire year.
These consolidated financial statements should be read in conjunction with the
financial statements included in the Company's Annual Report on Form 10-K for
the year ended March 31, 1996, as filed with the Securities and Exchange
Commission.
BUSINESS COMBINATIONS
On June 5, 1996, Urohealth Systems, Inc. ("Urohealth") acquired certain assets
of O.R. Concepts, Inc. pursuant to an Asset Purchase Agreement dated June 5,
1996 among Urohealth, O.R. Concepts, Inc., a Texas Corporation, and Vital Signs,
Inc., a New Jersey Corporation. The acquired assets are used in the development,
manufacture, and marketing of laparoscopic surgery products and accessories.
The purchase price for the acquired assets was $2,786,000, payable in cash upon
the closing of the transaction. The purchase price was funded using a portion of
the proceeds from the sale of Urohealth's 8.75% Convertible Subordinated
Debentures issued May 13, 1996.
6
<PAGE> 7
UROHEALTH SYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
1. INTERIM REPORTING (CONTINUED)
On July 1, 1996, Urohealth acquired The Intermed Group, Inc., a Delaware
Corporation ("Intermed"), pursuant to the terms of the Agreement and Plan of
Merger dated as of June 1, 1996 between Urohealth, Urohealth, Inc. (California),
and Intermed. Intermed is engaged in the development, manufacture, and marketing
of disposable medical products.
Under the terms of the agreement, Intermed was merged into Urohealth, Inc.
(California), and each outstanding share of common stock of Intermed was
converted into the right to receive .1242575 shares of Urohealth Common Stock,
plus cash in the amount of $1,462,412 was paid in exchange for all of the
outstanding shares of Intermed common stock. The cash portion of the purchase
price was funded using a portion of the proceeds from the sale of Urohealth's
8.75% Convertible Subordinated Debentures issued May 13, 1996.
On July 5, 1996, Urohealth entered into an agreement to acquire all of the
outstanding capital stock of Richard-Allan Medical Industries, Inc.
("Richard-Allan"), an Illinois corporation, in exchange for $27.5 million in
cash and 2,084,691 shares of Urohealth common stock. Richard-Allan manufactures
and markets surgical operating room supplies. In addition, the Company agreed to
acquire the real estate on which the Richard-Allan facility is located from a
partnership for $1.5 million of cash and a $3.0 million note for the balance of
the purchase price. The acquisition is expected to close in August 1996.
The Company expects that some portion of the Richard-Allan purchase price will
be ascribed to incomplete research and development. An evaluation of acquired
research and development will consider, among other factors, the stage of
development of each product, the time and resources needed to complete each
product, expected income and associated risks (including the inherent
difficulties and uncertainties in developing and manufacturing new products and
potential alternative surgical procedures in future target markets). This
analysis may result in a one-time non-cash charge to earnings for incomplete
research and development related to the acquired company that does not have
alternative future use. No such charge has been recognized in the pro forma
financial information herein.
All of these transactions have been accounted for as purchases whereby the
results of operations from each separate entity or group of assets will be
included in the results of operations of the Company from the date of purchase.
7
<PAGE> 8
UROHEALTH SYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
The following summarized, unaudited pro forma results of operations for the
three months ended June 30, 1996 and 1995, assume the acquisitions occurred as
of the beginning of the respective periods (dollars in thousands except per
share amounts):
<TABLE>
<CAPTION>
1996 1995
------- -------
<S> <C> <C>
Net sales $23,599 $19,740
Net (loss) $(4,080) $(1,216)
Net (loss) per share $ (0.26) $ (0.09)
</TABLE>
2. NET LOSS PER SHARE
Net loss per share is based on the weighted average number of shares of common
stock outstanding during the periods presented. Common stock equivalents have
not been included in the calculation because they are anti-dilutive. Net loss
per common share for the three months ended June 30, 1996 has been restated to
reflect $295,000 of additional dividends and accretion on redeemable
convertible preferred stock resulting from the induced conversion of such stock
into the Company's common stock in May 1996.
The Company has restated its loss per share information for the three month
period ended June 30, 1996 in this Form 10-Q/A to reflect the impact ($295,000)
of warrants issued to induce the conversion of the redeemable convertible
preferred stock as an adjustment to arrive at net loss applicable to common
stock.
3. INVENTORIES
Inventories are carried at the lower of cost or net realizable value. Cost is
determined on the first-in, first-out basis (in thousands).
<TABLE>
<CAPTION>
June 30 March 31
1996 1996
------- --------
<S> <C> <C>
Finished Goods $ 3,566 $ 3,424
Raw Materials and Supplies 4,608 1,963
Work in Progress 817 318
------- -------
$ 8,991 $ 5,705
======= =======
</TABLE>
4. DEBT
On May 13, 1996, the Company authorized the issuance of $50.0 million of 8.75%
convertible subordinated debentures (the "Debentures") and warrants to purchase
250,000 shares of the Company's common stock at $13.00 per share. The Debentures
mature in May 2006 and interest is payable quarterly in arrears. The warrants
expire in five years.
As of June 30, 1996, the Company had received $34.3 million from the Debenture
holders. The remaining $15.7 million was received on July 9, 1996.
8
<PAGE> 9
UROHEALTH SYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
4. DEBT (CONTINUED)
The Debentures are redeemable at the option of the Company after two years, if
the average market price of the Company's common stock is above $22.00 per share
for 60 consecutive days, or after three years without regard to the Company's
common stock price. The redemption price is equal to 105% of the principal
amount decreasing annually to the principal amount in 2004, plus accrued and
unpaid interest.
The Debentures are convertible into common stock at $11.00 per share, are
subordinate to all future senior borrowings and have voting rights on all
matters on an "as converted" basis. The holders of the Debentures must approve
any dividend, payment or other distribution to stockholders, as well as any
redemption of shares of common stock, options or warrants of the Company or any
subsidiary other than the preferred stock issued by Urohealth-California.
In connection with the financing, the Company incurred an extraordinary loss of
$2,973,000 in connection with the early retirement of bank debt of $16,500,000
on May 13, 1996.
5. RESTRUCTURING
During the year ended June 30, 1995, the Company hired a new senior management
team which adopted and implemented a restructuring plan (the Plan) under which
it has refocused the Company's strategic direction. Under the Plan, the Company
terminated or amended certain distribution, consulting and employment
agreements. All significant restructuring charges were paid in cash during the
1995 calendar year. Through June 30, 1996, cash payments have reduced the
components of the restructuring accrual to $276,000 primarily relating the
settlement of certain claims with the former Chief Executive Officer.
In December 1995, the Company implemented a restructuring plan to consolidate
redundant facilities and reduce personnel resulting from the mergers with
Dacomed Corporation, Osbon Medical Systems, Ltd. and Advanced Surgical, Inc.
Under the Plan, the Company has eliminated approximately 70 manufacturing,
engineering and administrative personnel and closed all operations at two
acquired facilities. The estimated cost associated with each component of this
restructuring plan and the cash and non-cash charges incurred during fiscal 1996
are summarized in the table below. Non-cash charges consist of the write-down
of exiting assets to their estimated net realizable value. Reclassifications
during the period relate to decreases in severance amounts
9
<PAGE> 10
UROHEALTH SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
5. RESTRUCTURING (CONTINUED)
payable to officers of acquired companies, offset by increases in estimates for
facility closure costs including loss on sale of discontinued product lines and
closure costs related to international operations of acquired companies. The
remaining restructuring accrual at June 30, 1996 relates primarily to terminated
employee severance and facility lease obligations, which are expected to be paid
in cash. Although subject to future adjustment, management of the Company
believes that restructuring reserves as of June 30, 1996 are adequate to
complete the restructuring.
<TABLE>
<CAPTION>
Beginning Balance at
Restructuring Non-Cash Cash June 30,
Accrual Charges Charges Reclassifications 1996
------- ------- ------- ----------------- ---------
(in thousands)
<S> <C> <C> <C> <C> <C>
Personnel reduction costs $ 2,620 $ -- $ 1,609 $ (730) $ 281
Facility reduction costs 2,836 1,199 1,482 730 885
------- ------- ------- ------- -------
$ 5,456 $ 1,199 $ 3,091 $ -- $ 1,166
======= ======= ======= ======= =======
</TABLE>
The Company anticipates significant costs will be incurred in connection with
the implementation of a plan of consolidation during either its second or third
fiscal quarter in connection with the integration of Intermed Group, Inc., and
Richard-Allan Medical Industries, Inc. This restructuring may include severances
and facility closure costs as well as charges related to the write-off of assets
associated with discontinued products.
6. MINORITY INTEREST REDEMPTION
On June 11, 1996, the Company approved the redemption of the Series A Preferred
Stock issued by Urohealth, Inc., a wholly owned subsidiary. The Board authorized
the Company to redeem the remaining 203,000 shares of the Series A Preferred
Stock at $5.00 per share plus a $0.25 premium and accrued interest, for at total
consideration of $6.20 per share. The share repurchase will eliminate the
accumulation of dividends which accrue at 7% per annum.
7. CONTINGENCIES
The Company is a defendant in approximately five lawsuits seeking damages
against the Company in products liability and related theories. The Company has
also been notified of certain other products liability claims that may become
the subject of lawsuits in the future. The Company is being defended in such
lawsuits by law firms selected by the Company's products liability insurer(s).
In addition, the Company is involved from time to time in various claims and
legal actions in the ordinary course of business. No provision for any
liability that may result from the ultimate resolution of such matters has been
included in the accompanying consolidated financial statements.
8. LITIGATION
See Part II, Item 1.
10
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
THREE MONTHS ENDED JUNE 30, 1996 COMPARED TO THREE MONTHS ENDED JUNE 30, 1995.
Net Sales. For the quarter ended June 30, 1996, net sales of $16,892,000
were $4,185,000 or 33% higher than sales of $12,707,000 for the same period in
1995. This increase was largely due to higher sales of the Company's impotence
products which increased $4,100,554 or 44% to $13,506,000, and the release of
the Company's Endoview product which generated sales of $726,000 during the
month ended June 30, 1996.
Gross Profit. For the quarter ended June 30, 1996, gross profit increased
$3,204,000 or 38% over the same period in 1995. The gross margin percentage
increased from 66% to 69% for the quarter ended June 30, 1996 largely due to
sales growth in the Company's higher margin impotence product line.
Selling, General and Administrative. Selling, general and administrative
expenses for the quarter ended June 30, 1996 decreased $491,000 or 5% over the
same period in 1995. The Company closed two facilities in January 1996 which
contributed to administrative cost savings during the quarter ended June 30,
1996.
Research and Development. Research and development costs for the quarter
ended June 30, 1996 decreased $204,000 or 37% over the same period in 1995 due
to the Company's decision to narrow the focus of such efforts, and to adopt a
program of actively acquiring or licensing developed technology.
Interest Expense. Interest expense for the quarter ended June 30, 1996
increased $866,000 or 912% over the same period in 1995, primarily due to
increased borrowings on term loans, lines of credit and the issuance of the
convertible subordinated debentures.
LIQUIDITY AND CAPITAL RESOURCES
Through July 1996, the Company's operations have been funded by the sale of
equity securities in both public and private offerings, and debt financing. The
Company had working capital of approximately $12.4 million at June 30, 1996, and
has historically had negative cash flows from operations. On May 13, 1996, the
Company entered into a $50.0 million securities purchase agreement, under which
the Company received net proceeds of approximately $45.2 million, in exchange
for 8.75% convertible subordinated debentures. The final closing on
approximately $15.7 million of convertible subordinated debentures occurred on
July 9, 1996. The debentures are convertible into Common Stock of the Company at
$11.00 per share at the option of the
11
<PAGE> 12
Company. Through June 30, 1996, the Company has used approximately $30.3 million
of the net proceeds for the repayment of previous debt obligations, to complete
two business acquisitions and to finance the Company's operations. The
remaining cash reserves of the Company are approximately $9.0 million.
To finance the cash portion of the Richard-Allan acquisition, the Company is
obtaining a $35 million bank credit facility. The facility will consist of a $20
million dollar term loan and a $15 million revolving line of credit. The credit
facility is to be secured by substantially all the assets of the Company.
Additionally, the Company will be required to meet certain financial covenants.
While management believes that the acquisition of Richard-Allan, pending the
completion of the bank credit facility, is probable, there can be no assurances
that financing of the cash portion of the purchase price will ultimately be
available on terms acceptable to the Company.
Approximately $600,000 of the Company's restructuring charges are projected to
be paid over the next twelve months. The long-term portion consists of redundant
facility lease costs to be paid out through 2003 and severance costs to be paid
out over the next two years.
The Company's business strategy includes efforts to expand business operations
through the acquisition of new products, product lines and businesses. The
Company will use a portion of its cash balances or future debt or equity
financings to make such future acquisitions. Currently, the Company is
evaluating several business acquisitions whose purchase price will be paid in
cash or stock.
BUSINESS RISKS
Except for the historical information contained herein, the matters discussed in
this report are forward looking statements that involve risks and uncertainties.
Potential risks and uncertainties include, without limitation, historical
operating losses, dependence on new products, ability to manage growth, reliance
on patents and proprietary rights, government regulation and required approvals,
potential healthcare reform, competition, and dependence on management. More
information on potential factors which could affect the Company's financial
results are included in the Company's Annual Report on Form 10-K for fiscal 1996
which has been filed with the Securities and Exchange Commission.
12
<PAGE> 13
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. The Company is involved from time to time in various
claims and legal actions arising in the ordinary course of business. No
provision for any liability that may result from the ultimate resolution of such
matters has been included in the consolidated financial statements. In
management's opinion, the ultimate resolution of claims currently pending will
not have a material adverse effect on the Company's business, results of
operations or financial condition.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K.
Form 8-K/A - Amendment No. 1 to the Current Report on Form 8-K dated
July 1, 1996
13
<PAGE> 14
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Quarterly Report
on Form 10-Q to be signed on its behalf by the undersigned, thereunto
duly authorized, this 13th day of August 1996.
UROHEALTH Systems, Inc.
a Delaware corporation
By: /s/ JAMES L. JOHNSON
---------------------------------
James L. Johnson
Chief Financial Officer
14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<EXCHANGE-RATE> 1
<CASH> 3,603
<SECURITIES> 0
<RECEIVABLES> 11,113
<ALLOWANCES> 1,512
<INVENTORY> 8,991
<CURRENT-ASSETS> 26,309
<PP&E> 11,589
<DEPRECIATION> 0
<TOTAL-ASSETS> 54,996
<CURRENT-LIABILITIES> 13,956
<BONDS> 0
0
0
<COMMON> 14
<OTHER-SE> 5,217
<TOTAL-LIABILITY-AND-EQUITY> 54,996
<SALES> 16,892
<TOTAL-REVENUES> 16,892
<CGS> 5,257
<TOTAL-COSTS> 5,257
<OTHER-EXPENSES> 9,449
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 961
<INCOME-PRETAX> 1,258
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,258
<DISCONTINUED> 0
<EXTRAORDINARY> 2,973
<CHANGES> 0
<NET-INCOME> (1,715)
<EPS-PRIMARY> (0.16)
<EPS-DILUTED> 0
</TABLE>
