FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended June 30, 1999
Commission File Number 000-20175
NYER MEDICAL GROUP, INC
(Exact name of registrant as specified in its charter)
Florida 01-0469607
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1292 Hammond Street, Bangor, Maine 04401
(Address of principal executive offices) (Zip Code)
(207) 942-5273
(Registrant's telephone number, including area code)
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 twelve 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 .
As of August 23, 1999, there were outstanding, 3,407,093 shares of common
stock,par value $.0001 per share.
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
INDEX
PART I
FINANCIAL INFORMATION
Page No.
Item 1. Financial Statements:
Consolidated Balance Sheets, June 30, 1999
and December 31, 1998 3-4
Consolidated Statements of Operations, Three Months
Ended June 30, 1999 and June 30, 1998 5
Consolidated Statements of Operations, Six Months
Ended June 30, 1999 and June 30, 1998 6
Consolidated Statements of Cash Flows, Six Months
Ended June 30, 1999 and June 30, 1998 7-8
Notes to Consolidated Financial Statements 9-10
Item 2. Management's Discussion and Analysis of
Second Quarter 1999 Results 11-16
PART II - OTHER INFORMATION
Item 3. Other Information 16
Signatures 16
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(Unaudited)
June 30, December 31,
1999 1998
Current assets:
Cash and cash equivalents $3,216,816 $ 4,136,988
Accounts receivable, less
allowance for doubtful accounts
of $165,240 at June 30, 1999
and $188,076 at December 31, 1998 2,995,965 3,560,377
Inventories, net 4,190,027 4,073,051
Prepaid expenses 187,439 105,045
Receivables from related parties 50,823 48,139
Total current assets 10,641,070 11,923,600
Property, plant and equipment, at
cost:
Land 92,800 92,800
Building 641,508 641,508
Leasehold improvements 500,919 381,702
Machinery and equipment 267,336 223,807
Transportation equipment 319,641 260,285
Office furniture, fixtures,
and equipment 918,966 805,748
2,741,170 2,405,850
Less accumulated depreciation
and amortization (991,775) (902,872)
1,749,394 1,502,978
Goodwill and other deferred assets,
net of accumulated amortization of
$455,363 and $386,171 at June 30,
1999 and December 31, 1998,
respectively 733,617 802,809
Advances due from related companies 31,254 34,488
Other 146,996 148,167
911,867 985,464
Total assets $13,302,331 $14,412,042
See accompanying notes to consolidated financial statements.
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
(Unaudited)
June 30, December 31,
1999 1998
Current liabilities:
Notes payable due related parties $ 120,000 $ 120,000
Current portion of long-term debt 430,786 236,669
Accounts payable 2,402,967 2,627,292
Accrued payroll and related taxes 159,901 206,465
Accrued expenses and other
liabilities 61,354 322,753
Total current liabilities 3,175,008 3,513,179
Notes payable due related party,
net of current portion 482,820 522,820
Long-term debt, net of current
portion 391,392 480,711
Minority interest 684,286 744,357
Deferred credits 90,207 118,109
Shareholders' equity:
Class A Preferred stock, par value
$.0001, Authorized, issued and
outstanding: 2,000 shares 1 1
Class B Preferred stock, series 1,
par value $.0001, Authorized:
2,500,000; issued and outstanding:
1,000 shares at June 30, 1999 and
December 31, 1998
Common stock, par value $.0001
Authorized: 10,000,000 shares;
issued: 3,407,093 at June 30, 1999
and December 31, 1998 341 341
Additional paid-in capital 15,238,376 15,238,376
Stock sale receivable (115,500) (115,500)
Treasury stock (11,000 shares at
June 30, 1999 and
December 31, 1998) (52,249) (52,249)
Accumulated deficit (6,592,351) (6,038,103)
Total shareholders' equity 8,478,618 9,032,866
Total liabilities and
shareholders' equity $13,302,331 $14,412,042
See accompanying notes to consolidated financial statements.
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)
Three Months Ended
June 30, June 30,
1999 1998
Net sales $9,504,138 $9,690,662
Cost and expenses:
Cost of goods sold 7,747,458 7,535,193
Selling and retail 1,412,382 1,381,100
Warehouse and delivery 86,656 82,519
Administrative 653,031 675,142
9,899,527 9,673,954
Operating (loss) income (395,389) 16,708
Other income (expense):
Interest expense (20,406) (14,080)
Interest income 44,576 36,870
Other 11,604 10,244
Total other income 35,774 33,034
(Loss) income before
minority interest (359,615) 49,742
Minority interest 31,744 (53,893)
Loss from continuing operations
before income taxes (327,871) (4,151)
Income taxes 12,504
(Loss) income from
continuing operations
after income taxes (327,871) 8,353
Discontinued operations
Loss from operations of discontinued
subsidiary-Genetic Vectors (195,679)
Gain on sale of Genetic Vectors'
stock 146,862
Loss from discontinued subsidiary
Genetic Vectors (48,817)
Net Loss $ (327,871) $ (40,464)
Basic and diluted loss per common
share from continuing operations $ (.10) $ .00
Basic and diluted loss per common
share from discontinued operations (.01)
Basic and diluted loss per
common share $ (.10) $ (.01)
Weighted average common shares
outstanding 3,407,093 3,403,467
See accompanying notes to consolidated financial statements.
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)
Six Months Ended
June 30, June 30,
1999 1998
Net sales $18,958,572 $17,590,468
Cost and expenses:
Cost of goods sold 15,377,588 13,730,572
Selling and retail 2,790,122 2,694,409
Warehouse and delivery 172,185 171,740
Administrative 1,366,094 1,292,541
19,705,989 17,889,262
Operating loss (747,417) (298,794)
Other income (expense):
Interest expense (44,481) (42,198)
Interest income 119,275 135,628
Other 58,304 10,243
Total other income 133,098 103,673
Loss before minority interest (614,319) (195,121)
Minority interest 60,071 (26,788)
Loss from continuing operations
before income taxes (554,248) (221,909)
Discontinued operations
Loss from operations of discontinued
subsidiary-Genetic Vectors (313,110)
Gain on sale of Genetic Vectors'
stock 146,862
Loss from discontinued subsidiary
Genetic Vectors (166,248)
Net Loss $ (554,248) $ (388,157)
Basic and diluted loss per
common share from continuing
operations $ (.16) $ (.06)
Basic and diluted loss per common
share from discontinued
operations (.05)
Basic and diluted loss per
common share $ (.16) $ (.11)
Weighted average common shares
outstanding 3,407,093 3,406,189
See accompanying notes to consolidated financial statements.
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
June 30, June 30,
1999 1998
Cash flows from operating
activities:
Net loss $ (554,248) $ (388,157)
Adjustments to reconcile to net cash
used in operating activities:
Loss of unconsolidated
subsidiary 313,110
Depreciation and amortization 243,176 186,148
Gain on disposal of property, plant
and equipment
Gain on sale of pharmacy (25,000)
Minority interest (60,071) (26,788)
Changes in certain working capital
elements (312,149) (441,204)
Net cash flows used in
operating activities (708,292) (356,891)
Cash flows from investing activities:
Purchase of property, plant and
equipment (337,490) (121,800)
Proceeds from sale of pharmacy 50,800
Proceeds from sale of Genetic
Vectors' stock 146,862
Proceeds from sale of other
equity securities 15,787
Net change in advances due from
related companies 3,234 4,508
Decrease (increase) in other
assets, net 895 (87,764)
Net cash used in investing
activities (282,561) (42,407)
Cash flows from financing activities:
Proceeds from issuance of
long-term debt 200,000 176,971
Payments of long-term debt (89,319) (77,576)
Net (repayments to)proceeds from
notes due related parties (40,000) (12,000)
Payments for purchase of treasury stock (52,248)
Net cash provided by
financing activities 70,681 35,147
Net decrease in cash
and cash equivalents (920,172) (415,422)
Cash and cash equivalents at
beginning of period 4,136,988 4,497,010
Cash and cash equivalents at
end of period $3,216,816 $4,081,588
See accompanying notes to consolidated financial statements.
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
June 30, June 30,
1999 1998
Changes in certain working capital
elements:
Accounts receivable, net $ 564,412 $ (134,548)
Inventories (116,976) (53,153)
Prepaid expenses (82,394) (27,307)
Receivables from related parties (2,684) (31,594)
Decrease in deferred credits (27,902) (25,547)
Accounts payable (224,325) 107,318
Accrued payroll and related
taxes (46,564) (3,029)
Accrued expenses and other
liabilities (375,716) (273,344)
Net change $ (312,149) $ (441,204)
Six Months Ended
June 30, June 30,
1999 1998
Cash paid during the first
six months:
Interest $ 39,550 $ 40,181
FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
1. The consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principals have been condensed or omitted pursuant to such rules and
regulations, although the Company believes that the disclosures are
adequate to make the information presented not to be misleading. In
the opinion of management, the amounts shown reflect all adjustments
necessary to present fairly the financial position and results of
operations for the periods presented. All such adjustments are of a
normal recurring nature.
Basic and diluted loss per share of common stock has been determined
by dividing net earnings by the weighted average number of shares of
common stock outstanding.
It is suggested that the financial statements be read in conjunction
with the financial statements and notes thereto included in the
Company's Form 10-K for the year ended December 31, 1998.
2. Business Segments:
The Company had four active business segments in 1999, and 1998:
(1)wholesale and retail sale of surgical, diabetic, medical equipment and
supplies, (2) nutritional supplies (3) wholesale and retail distribution of
equipment, supplies, and novelty items to emergency medical service, fire
departments, and police departments, and (4) retail pharmacy drug store chain.
Business segments are determined based on products or services offered for
sale.
Summary data for the quarter ended June 30, 1999 is as follows:
Diabetic,
Medical, and Nutritional EMT, Fire, Police Pharmacy
Surgical Supplies Supplies Equip and Supplies Chain Corporate
Net Sales $3,514,216 $3,379,788 $12,064,568
Operating
(loss)income (39,839) $(223,916) (112,075) (168,077)$ (203,510)
Total assets 2,474,432 333,811 2,089,854 5,206,952 3,197,282
Capital
Expenditures 91,003 2,275 35,349 208,863
Depreciation
and
amortization 51,729 28,030 37,767 123,143 2,507
Interest income (6,956) (13,789) (98,530)
Interest
expense 18,107 530 25,844
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
2. Business Segments, continued
Summary data for the quarter ended June 30, 1999 is as follows: continued
Consolidated
Net Sales $18,958,572
Operating
(loss)income (747,416)
Total assets 13,302,331
Capital
Expenditures 337,490
Depreciation
and
amortization 243,176
Interest income (119,275)
Interest
expense 44,481
Summary data for the quarter ended June 30, 1998 is as follows:
Diabetic,
Medical, and Nutritional EMT, Fire, Police Pharmacy
Surgical Supplies Supplies Equip and Supplies Chain Corporate
Net Sales $3,135,499 $102,291 $3,609,401 $10,743,277
Operating
(loss)income (37,074) (249,854) 26,391 146,803 $ (185,060)
Total assets 2,683,156 335,857 2,388,512 4,968,977 5,210,711
Capital
Expenditures 12,841 419 108,540
Depreciation
and
amortization 50,884 25,892 34,218 72,334 2,820
Interest income (3,539) (38,785) (93,304)
Interest
expense 25,429 1,392 15,377
Consolidated
Net Sales $17,590,468
Operating
(loss)income (298,794)
Total assets 15,587,213
Capital
Expenditures 121,800
Depreciation
and
amortization 186,148
Interest income (135,628)
Interest
expense 42,198
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE SECOND QUARTER RESULTS
Results of Operations
Quarter Ended June 30, 1999 as compared to Quarter Ended June 30, 1998.
NET SALES. Total sales for the first six months of 1999 increased 7.8% over the
same period of 1998 to $18,958,572, representing an increase of $1,368,104.
The following table shows sales by subsidiary for the first six months of
1999 and 1998:
Six months ended
June 30, June 30,
Subsidiary 1999 1998 % increase (decrease)
Eaton $12,064,568 $10,743,277 12.3%
Anton 1,513,771 1,748,007 (13.4)
ADCO 2,906,020 2,576,869 12.8
SCBA 16,415 24,505 (33.0)
ADCO South 560,170 558,630 -
Conway 1,849,601 1,836,889 .7
Nyer Nutritional 102,291 (100.0)
Nyer Diabetic 48,027 100.0
$18,958,572 $17,590,468
The major reason for the increase in sales was due to Eaton's
increase of approximately $1.3.
The following table shows sales by subsidiary for three months ended June 30,
1999 and 1998:
Three months ended
June 30, June 30,
Subsidiary 1999 1998 % increase (decrease)
Eaton $6,366,704 $5,720,032 11.3%
Anton 804,350 1,006,994 (20.1)
ADCO 1,550,098 1,278,027 21.3
SCBA 12,119 16,227 (25.3)
ADCO South 279,737 277,296 -
Conway 466,989 1,289,795 (63.8)
Nyer Nutritional - 102,291 (100.0)
Nyer Diabetic 24,141 100.0
$9,504,138 $9,690,662
GROSS PROFIT MARGIN. The Company's overall gross margins were approximately
18.9% for the first six months of 1999 as compared 21.9% for the same period
in 1998.
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Results of Operations: continued,
The following is a table of gross margins by subsidiary for the first six
months 1999 and 1998 and for three months ended June 30, 1999 and 1998:
For six months ended For three months ended
June 30, June 30, June 30, June 30,
Subsidiary 1999 1998 1999 1998
Eaton 18.2% 20.8% 19.4% 19.4%
Anton 22.0 17.7 20.0 20.0
ADCO 24.4 25.0 25.3 25.3
SCBA 28.6 68.0 24.1 71.0
ADCO South 26.6 23.6 22.7 22.7
Conway 10.4 26.5 31.0 31.0
Nyer Nutritional - 28.7 28.7 28.7
Nyer Diabetic 27.8 - -
Eaton's gross margin declined due to lower reimbursements from insurance
companies, medicare and medicaid. They believe they can off set this decline
by increased sales volume. Anton's increase was the result of higher
supplies sales and lower sales in equipment sales (supplies sales generally
have a higher gross profit margin than equipment sales). Conway's decrease
in margin was the result of three fire truck deliveries in the first quarter
of 1999. Fire trucks and equipment sales are sold at lower gross margins. The
average gross profit margin for fire trucks is between 3-7%.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Consolidated selling, general,
and administrative expenses increased approximately 4.1% in 1999 to
$4,328,401 from $4,158,690 in 1998. The following table shows the breakdown
by subsidiary (and corporate expenses) as follows:
Six months ended Three months ended
June 30, June 30, June 30, June 30,
Subsidiary 1999 1998 1999 1998
Eaton $ 2,361,979 $ 2,088,087 $ 1,127,406 $ 1,044,231
Anton 362,438 399,711 183,809 206,168
ADCO 744,881 684,928 391,350 340,774
SCBA 2,324 2,885 - 2,192
ADCO South 124,661 131,099 60,220 66,113
Corporate 203,511 185,060 108,506 97,820
Conway 285,092 387,625 143,752 214,473
Nyle Home Health 436 66 119 -
Nyer Diabetic 43,909 - 20,368 -
Nyer Nutritional 199,170 279,229 116,539 166,990
$ 4,328,401 $ 4,158,690 $ 2,152,069 $ 2,138,761
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Results of Operations: continued,
The main increases came from Eaton due to increased personnel costs.
Anton's and Conway's decrease is due to less personnel costs. Nyer
Nutritional had decreased marketing expenses in 1999 as compared to 1998.
NET LOSS. In total, the Company experienced a net loss of $554,248 in 1999 as
compared to a net loss of $221,909 in 1998 from continuing operations.
The following table summarizes the loss from continuing operations by
subsidiary:
Six months ended Three months ended
June 30, June 30, June 30, June 30,
Subsidiary 1999 1998 1999 1998
Eaton $ (129,800) $ 107,555 $ (82,771) $ 53,589
Anton (28,098) (79,702) 7,483 (10,431)
ADCO (35,372) (48,732) (18,060) (19,003)
SCBA (1,703) 7,426 541 5,698
ADCO South 15,362 (8,686) 2,506 7,773
Corporate (27,060) (9,023) (28,335) 58,712
Conway (80,682) 71,874 (52,227) 51,169
Nyle Home Health (436) (767) (119) (584)
Nyer Diabetic (30,543) - (11,562) -
Nyer Nutritional (235,916) (261,854) (145,327) (138,570)
$ (554,248) $ (221,909) $(327,871) $ 8,353
The majority of the loss came from the Company's subsidiary, Nyer
Nutritional, which showed a loss of $235,916 for the first six months of 1999
as compared to a loss of $261,854 for the same period in 1998. Nyer Nutritional
generated no revenues for the first six months of 1999. The Company has signed
a letter of intent to sell Nyer Nutritional Systems. See Liquidity and Capital
Resources section. Eaton incurred additional overhead costs associated with its
sale of a store, the implementation of a new computer system, and have seen a
decline in their margins due to lower than expected reimbursements from the
insurance companies. ADCO's loss of $35,372 as compared to a loss of $48,732 in
1998, can be attributed to increased sales and margin which was partially off
set by costs associated with the start up of its respiratory division in
February of 1999 (which had minimal sales to offset the additional overhead)
and the development of an interactive web site which added additional overhead
with no sales to offset the costs until the third quarter of 1999. Corporate
had a loss due to less interest income which help to reduce corporate overhead
costs and additional overhead for public relations. ADCO South's net income
was the result of increased gross profit margins. ADCO South also had minimal
equipment sales for the second quarter of 1999 as compared to 1998. Anton and
reduction in their losses is due to less personnel costs due to less sales.
Conway had a change over in their sales force in the fourth quarter of 1998
and is just now starting to see increased sales due to the hiring of two
new salesmen. Nyer Nutritional's decrease in overhead was due to less selling
and show expenses for the second quarter of 1999 as compared to 1998's second
quarter.
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE SECOND QUARTER RESULTS
Results of Operations: continued,
The Company currently owns 739,216 shares (or 31.5%) of the outstanding
common stock of Vectors.
In December 1998, the Company wrote down its investment in Vectors to
zero due to significant uncertainties regarding the Company's ability to
recover its investment.
Net interest expense as a percentage of sales was less than 1% in the
first three months of 1999 and 1998, respectively.
Liquidity and Capital Resources
In January 1999, the Company sold certain assets of a pharmacy
for cash.
During the first quarter of 1999, the Company's pharmacy chain
borrowed on its line of credit in the amount of $200,000. The interest
rate is prime which was 8.00% as of August 23, 1999.
The Company anticipates at current cash levels is adequate to fund the
operating needs and potential acquisitions for the foreseeable future.
The Company has signed a letter of intent to sell its 80% interest
in Nyer Nutritional Systems, Inc., to a national medical distributing
organization. Since its acquisition in December of 1996, this division has
incurred continuous losses. The Company feels that this is a positive move to
streamline operations and provide increased shareholder value.
The selling price consists of a cash payment at closing and a percentage
of sales over a period of time. The acquisition is subject to a definitive
asset purchase agreement. It is anticipated that this will close within the
next 40 days.
Safe Harbor under the Private Securities Litigation Reform Act of 1995
The statements made above relating to the anticipated closing of the transaction
and receipt of future revenues are forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Some or all of the
results we anticipate from these forward-looking statements may not occur.
Important factors that could occur include contractual or due diligence
issues may arise which could cause the buyer not to close the proposed
transaction. Additionally, even if closing occurs, the Company may not
receive the full amount of the purchase price due to competitive concerns,
internal matters relating to the business of the buyer and the failure of the
marketplace to accept the products of Nyer Nutritional.
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE SECOND QUARTER RESULTS
Liquidity and Capital Resources, continued
Year 2000
IMPACT OF YEAR 2000 - Computer Systems Compliance
The "Year 2000 Issue" is the result of the way computer
systems and programs define calendar dates; they could fail or make
miscalculations due to interpreting a date including "00" to mean
the year 1900, not year 2000. Some computer programs were written
using two digits rather than four to define the appropriate year.
This could result in a system failure or miscalculations causing
disruptions in normal business activities.
The Company has substantially analyzed its computer systems,
including embedded chip technology, to determine the potential
technical and economic impact of the "Year 2000 Issue" on the
Company's systems and business operations. In the last two
years, the Company has upgraded its major computer systems and
programs. To date, the Company has identified only one of its
subsidiaries which will have to replace its computer system in
order to be Year 2000 compliant. The Company estimates this cost
will be no greater than $15,000.
The Company is requesting assurances from its outside
suppliers which it relies on for inventory and services and its
customers (which includes 3rd party insurance companies), that
they are Year 2000 Compliant.
The Company does not expect that the costs of addressing the
Year 2000 issues (which are in the Company's control) will have a
material effect on their future operating results or financial
position. The Company's management believes its in-house risks, as
associated with the Y2K problems, are minimal. The Company has
limited or no control over their outside suppliers and its
customers Y2K problems. Any failure of these parties could have
a material adverse effect on continued uninterrupted business
operations of the Company.
At this time, the Company is in the process of developing a
contingency plan for its systems that are not Year 2000 compliant
and intends to have it in place by the third quarter of 1999.
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE SECOND QUARTER RESULTS
Liquidity and Capital Resources, continued
FORWARD-LOOKING STATEMENTS
The statements made above relating to: (1) the anticipated costs to
the Company of complying with the Year 2000 conversion, (2) the
anticipated future impact as a result of outside suppliers not
being Year 2000 compliant on a timely basis are forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934.
The results anticipated by any or all of the forward-looking
statements may not occur.
PART II
Item 3: Other information
The Company is still actively seeking to acquire medical related
companies.
FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 JUNE 30, 1999
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
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.
NYER MEDICAL GROUP, INC.
Date: August 23, 1999 /s/ Samuel Nyer
Samuel Nyer,
President
Date: August 23, 1999 /s/ Karen L. Wright
Karen L. Wright,
Treasurer
(Chief Financial Officer)
[TYPE] EX-27
[DESCRIPTION] Article 5 Fin Data Schedule for the 1st Qtr & 2nd quarter
[ARTICLE] 5
<TABLE>
<S> <C>
[PERIOD-TYPE] 6-MOS
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-END] JUN-30-1999
[CASH] 3,216,816
[SECURITIES] 0
[RECEIVABLES] 3,161,205
[ALLOWANCES] (165,240)
[INVENTORY] 4,190,027
[CURRENT-ASSETS] 10,641,070
[PP&E] 2,741,170
[DEPRECIATION] (991,775)
[TOTAL-ASSETS] 13,302,331
[CURRENT-LIABILITIES] 3,175,008
[BONDS] 964,419
[PREFERRED-MANDATORY] 0
[PREFERRED] 1
[COMMON] 341
[OTHER-SE] 8,478,618
[TOTAL-LIABILITY-AND-EQUITY] 13,302,331
[SALES] 18,958,572
[TOTAL-REVENUES] 18,958,572
[CGS] 15,377,588
[TOTAL-COSTS] 4,328,401
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 44,481
[INCOME-PRETAX] (554,248)
[INCOME-TAX] 0
[INCOME-CONTINUING] (554,248)
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (554,248)
[EPS-BASIC] (.16)
[EPS-DILUTED] 0
</TABLE>
