<PAGE>
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 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 0-23946
PEDIATRIC SERVICES OF AMERICA, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 58-1873345
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3159 CAMPUS DRIVE, NORCROSS GA 30071
(Address of principal executive offices, including zip code)
(770) 441-1580
(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 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 [ ]
As of February 13, 1997 the Registrant had 6,256,473 shares of Common Stock,
$0.01 Par Value, outstanding.
________________________________________________________________________________
<PAGE>
FORM 10-Q
PEDIATRIC SERVICES OF AMERICA, INC.
INDEX
PART I FINANCIAL INFORMATION PAGE
NUMBER
ITEM 1: Financial Statements
Condensed Consolidated Balance Sheets as of
December 31, 1996 and September 30, 1996................. 3
Condensed Consolidated Statements of Operations for
the three months ended December 31, 1996 and 1995........ 5
Condensed Consolidated Statements of Cash Flows for
the three months ended December 31, 1996 and 1995........ 6
Notes to Condensed Consolidated Financial
Statements............................................... 7
ITEM 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations...................... 7
PART II OTHER INFORMATION
ITEM 4: Submission of Matters to a Vote of Security Holders...... 11
ITEM 6: Exhibits and Reports on Form 8-K......................... 12
Signatures............................................... 13
Index of Exhibits........................................ 14
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PEDIATRIC SERVICES OF AMERICA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
(UNAUDITED)
DECEMBER 31, SEPTEMBER 30,
1996 1996
------------- --------------
<S> <C> <C>
ASSETS
Current assets:
Cash & cash equivalents.......................................... $ 579 $ 770
Accounts receivable, less allowances for doubtful accounts
of $9,296 & $8,523, respectively............................. 54,329 47,745
Prepaid expenses................................................. 753 461
Deferred income taxes............................................ 3,524 3,524
Other current assets............................................. 2,284 2,065
-------- --------
Total current assets.............................................. 61,469 54,565
Property & equipment:
Home care equipment held for rental.............................. 20,005 19,014
Furniture & fixtures............................................. 5,308 4,910
Vehicles......................................................... 602 581
Leasehold improvements........................................... 558 562
-------- --------
26,473 25,067
Accumulated depreciation & amortization.......................... (12,589) (11,644)
-------- --------
13,884 13,423
Other assets:
Goodwill, less accumulated amortization of $2,627
& $2,333, respectively.......................................... 32,313 28,734
Certificates of need, less accumulated amortization of $191
& $176, respectively............................................ 1,156 1,172
Deferred financing fees, less accumulated amortization of
$95 & $76, respectively......................................... 375 216
Non-compete agreements, less accumulated amortization of
$612 & $582, respectively....................................... 338 368
Other............................................................ 305 258
-------- --------
Total assets...................................................... $109,840 $ 98,736
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements
3
<PAGE>
PEDIATRIC SERVICES OF AMERICA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
(UNAUDITED)
DECEMBER 31, SEPTEMBER 30,
1996 1996
------------- -------------
<S> <C> <C>
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.........................................................$ 5,441 $ 5,780
Accrued compensation..................................................... 4,337 3,581
Accrued insurance........................................................ 2,044 1,846
Other accrued liabilities................................................ 3,088 2,724
Deferred revenue......................................................... 759 792
Income taxes payable..................................................... 1,591 1,852
Current maturities of long-term obligations.............................. 2,973 2,318
-------- -------
Total current liabilities................................................. 20,233 18,893
Long-term obligations, net of current maturities.......................... 31,769 23,638
Deferred income taxes..................................................... 1,077 1,077
Minority interest in subsidiary........................................... 895 935
Stockholders' equity:
Preferred stock, $.01 par value, 2,000 shares authorized; no
shares issued & outstanding............................................ - -
Common stock, $.01 par value, 8,000 shares authorized; 6,250
shares at December 31, 1996 & 6,248 shares at September 30, 1996
issued & outstanding, respectively..................................... 62 62
Additional paid-in capital............................................... 41,531 41,514
Retained earnings........................................................ 14,273 12,617
-------- -------
Total stockholders' equity................................................ 55,866 54,193
-------- -------
Total liabilities & stockholders' equity................................. $109,840 $98,736
======== =======
</TABLE>
See accompanying notes to condensed consolidated financial statements
4
<PAGE>
PEDIATRIC SERVICES OF AMERICA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
(UNAUDITED)
------------------
1996 1995
-------- --------
<S> <C> <C>
Net revenue..............................................$46,554 $36,910
Costs & expenses:
Operating salaries, wages & employee benefits....... 19,734 16,865
Other operating costs............................... 17,948 12,832
Corporate, general & administrative................. 2,772 2,246
Provision for doubtful accounts..................... 1,375 1,071
Depreciation & amortization......................... 1,416 1,130
------- -------
Total costs and expenses.......................... 43,245 34,144
------- -------
Operating income......................................... 3,309 2,766
Interest expense......................................... 575 270
------- -------
Income before income taxes and minority interest......... 2,734 2,496
Minority interest loss in subsidiary..................... 40 -
------- -------
Income before income taxes............................... 2,774 2,496
Income taxes............................................. 1,118 1,007
------- -------
Net income...............................................$ 1,656 $ 1,489
======= =======
SHARE DATA:
Net income per common and common equivalent share... $0.26 $0.24
======= =======
Weighted average common shares outstanding.......... 6,432 6,041
======= =======
</TABLE>
See accompanying notes to condensed consolidated financial statements
5
<PAGE>
PEDIATRIC SERVICES OF AMERICA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
(UNAUDITED)
1996 1995
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net income......................................................................... $ 1,656 $ 1,489
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation & amortization........................................................ 1,416 1,130
Provision for doubtful accounts.................................................... 1,375 1,071
Amortization of deferred financing fees............................................ 19 9
Deferred income taxes.............................................................. - (355)
Minority interest loss in subsidiary............................................... (40) -
Changes in operating assets & liabilities, net of effects from acquisitions of
businesses:
Accounts receivable................................................................ (7,031) (7,507)
Prepaid expenses and other current assets.......................................... (551) (178)
Accounts payable................................................................... (360) 557
Income taxes....................................................................... (281) 564
Accrued liabilities................................................................ 1,036 164
------- -------
Net cash used in operating activities............................................... (2,761) (3,056)
INVESTING ACTIVITIES
Purchases of property & equipment.................................................. (1,400) (1,186)
Acquisitions of businesses......................................................... (4,250) (513)
Other, net......................................................................... (378) (343)
------- -------
Net cash used in investing activities................................................ (6,028) (2,042)
FINANCING ACTIVITIES
Borrowings on short-term revolving line of credit, net............................. - 815
Principal payments on long-term debt............................................... (91) (311)
Borrowings on long-term debt....................................................... 8,850 4,500
Deferred financing fees............................................................ (179) -
Proceeds from exercise of stock options............................................ 18 15
------- -------
Net cash provided by financing activities............................................ 8,598 5,019
------- -------
Decrease in cash & cash equivalents.................................................. (191) (79)
Cash & cash equivalents at beginning of year......................................... 770 101
------- -------
Cash & cash equivalents at end of period............................................... $ 579 $ 22
======= =======
Supplemental disclosure of cash flow information:
Cash paid for interest............................................................. $ 439 $ 277
======= =======
Cash paid for income taxes......................................................... $ 1,405 $ 839
======= =======
</TABLE>
See accompanying notes to condensed consolidated financial statements
6
<PAGE>
PEDIATRIC SERVICES OF AMERICA, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--UNAUDITED
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements of
Pediatric Services of America, Inc. (the "Company") have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all information and
notes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
(consisting only of normal recurring accruals) considered necessary for a
fair presentation have been included. Results of operations for the three
month period ended December 31, 1996 are not necessarily indicative of the
results to be expected for the entire fiscal year ending September 30,
1997. These condensed consolidated financial statements should be read in
conjunction with the Company's audited financial statements for the year
ended September 30, 1996 included in the Company's Annual Report on
Form 10-K for such year filed with the Securities and Exchange Commission.
Principal accounting policies are set forth in the Company's 1996 Annual
Report.
2. NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE
Net income per common and common equivalent share is computed using the
weighted average number of common and common equivalent shares outstanding
during the period. Dilutive common equivalent shares consist of stock
options (calculated using the treasury stock method). This calculation
excludes any antidilutive shares during the period.
3. ACQUISITIONS
On October 1, 1996, the Company purchased the assets and assumed certain
liabilities of IntensiCare, Inc. ("ICI"), a pediatric nursing company in
Elmhurst, Illinois, for a total purchase price of $3.1 million, consisting
of cash and assumption of indebtedness. Approximately $700,000 of the
purchase price was placed in escrow to be issued to the stockholders of ICI
on the first anniversary date of the purchase.
On October 1, 1996, the Company purchased the assets and assumed certain
liabilities of Pediatric Specialists, Inc. ("PSI"), a pediatric
phototherapy company in San Dimas, California, for a total cash purchase
price of $1.1 million. Approximately, $50,000 of the purchase price was
allocated to a non-compete agreement and $250,000 was placed in escrow to
be issued to the stockholders of PSI on the first anniversary date of the
purchase.
The acquisition of ICI and PSI are not considered significant and,
therefore, the consolidated financial statements do not reflect pro forma
financial information for these acquisitions.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
RESULTS OF OPERATIONS
The historical condensed consolidated statements of operations of the
Company for the three months ended December 31, 1996 contained in this
report and the following discussion thereof include the effect of the
Company's acquisitions of ICI and PSI subsequent to the respective dates of
acquisition.
7
<PAGE>
The following table is derived from the Company's unaudited condensed
consolidated statements of operations for the periods indicated and presents
results of operations as a percentage of net revenue and the percentage change
in the dollar amounts of each item from the prior period.
<TABLE>
<CAPTION>
PERIOD-TO-PERIOD
PERCENTAGE OF
PERCENTAGE OF NET REVENUE INCREASE (DECREASE)
--------------------------- -------------------
THREE MONTHS THREE MONTHS
ENDED ENDED
DECEMBER 31, DECEMBER 31,
--------------------------- -------------------
1996 1995 1996 TO 1995
------------- ------------ -------------------
<S> <C> <C> <C>
Net revenue..................................................... 100% 100% 26.1%
Operating salaries, wages and employee
benefits..................................................... 42.4 45.7 17.0
Other operating costs........................................... 38.5 34.8 39.9
Corporate, general & administrative............................. 6.0 6.1 23.4
Provision for doubtful accounts................................. 3.0 2.9 28.3
Depreciation and amortization................................... 3.0 3.0 25.3
---- ---- -------
Operating income................................................ 7.1 7.5 19.6
Interest expense................................................ 1.2 0.7 112.7
---- ---- -------
Income before income taxes and minority
interest..................................................... 5.9 6.8 9.6
Minority interest loss in subsidiary............................ 0.1 - 100.0
---- ---- -------
Income before income taxes...................................... 6.0 6.8 11.2
Income taxes.................................................... 2.4 2.8 11.1
---- ---- -------
Net income...................................................... 3.6% 4.0% 11.2%
==== ==== =======
</TABLE>
8
<PAGE>
The following table sets forth for the periods indicated a summary of net
revenue by category:
THREE MONTHS ENDED
DECEMBER 31,
-----------------------
PEDIATRIC HOME HEALTH CARE: 1996 1995
------- -------
Nursing...................................... $13,946 $12,824
Respiratory Therapy Equipment................ 4,667 3,793
Home Medical Equipment....................... 941 340
Pharmacy and Other........................... 6,691 4,783
------- -------
Total Pediatric Home Health Care................ 26,245 21,740
------- -------
ADULT HOME HEALTH CARE:
Nursing...................................... 5,810 4,150
Respiratory Therapy Equipment................ 5,412 5,192
Home Medical Equipment....................... 1,284 1,324
Pharmacy and Other........................... 1,635 1,092
------- -------
Total Adult Home Health Care................ 14,141 11,758
------- -------
Total Medical Testing Services.............. 6,168 3,412
------- -------
Total Net Revenue........................... $46,554 $36,910
======= =======
THREE MONTHS ENDED DECEMBER 31, 1996 COMPARED TO THREE MONTHS ENDED
DECEMBER 31, 1995.
Net revenue increased $9.6 million, or 26%, to $46.5 million in the three
months ended December 31, 1996 from $36.9 million in the same period in 1995.
The Company's acquisitions and start-up operations accounted for approximately
$3.5 million, or 37%, of the increase and internal growth accounted for the
remaining $6.1 million, or 63%, of the increase. Overall, the internal growth
in net revenue was 17% for the three months ended December 31, 1996. Of the
$9.6 million increase in net revenue in the 1996 period, pediatric net revenue
accounted for $4.5 million, or 47.0%, of the increase. Increased pediatric net
revenue for the three months ended December 31, 1996 was attributable to the
Company's acquisitions and start-up operations which contributed approximately
$3.4 million, or 75%, of the increase and to marketing efforts which resulted in
an increase in patients served rather than any significant increase in rates
charged. Adult net revenue accounted for $2.4 million, or 25%, of the increase
in net revenue for the three months ended December 31, 1996, primarily due to
internal growth of existing locations. Medical testing services net revenue
accounted for $2.7 million, or 28%, of the increase in net revenue for the
quarter, primarily due to an increase in the volume of business.
Operating salaries, wages and employee benefits consist primarily of branch
office operations. Operating salaries, wages and benefits increased $2.9
million, or 17%, to $19.7 million in the three months ended December 31, 1996
from $16.8 million in the same period in 1995. The increase was primarily due
to the Company's acquisitions and start-up operations which added approximately
$2.6 million, or 91%, of the increase and the remainder to internal growth. As
a percentage of net revenue, operating salaries, wages and employee benefits for
the three months ended December 31, 1996 decreased to 42% from 46% in the
comparable period in 1995. The decrease in operating salaries, wages and
employee benefits as a percentage of net revenue is primarily attributable to a
change in business mix to a higher percentage of pharmacy and medical testing
services net revenue to total net revenue. The pharmacy and medical testing
services operations maintain a lower operating salaries, wages and employee
benefits component as compared to the Company's other operations, thereby
decreasing the Company's overall ratio.
Other operating costs include medical supplies, branch office rents,
utilities, vehicle expenses and cost of sales. Other operating costs increased
$5.1 million, or 40%, to $17.9 million in the three months ended December 31,
1996 from $12.8 million in the comparable period in 1995. Of this increase,
$4.5 million, or 89%, relates to the Company's internal growth and the remainder
to the Company's acquisitions and start-up operations. As a percentage of net
revenue, other operating costs for the three months ended December 31, 1996
increased to 39% from 35% in the comparable period of 1995. The increase in
other operating costs as a percentage of net revenue is primarily attributable
to the increase in net revenue volume from the pharmacy and medical testing
services operations. The pharmacy and medical testing services operations have
a higher other operating cost component than the Company's other operations due
to the purchase of drug product for the pharmacy business and payment of
operating expenses for the medical testing services business.
9
<PAGE>
Corporate, general and administrative costs increased $0.5 million, or 23%,
to $2.8 million in the three months ended December 31, 1996 from $2.3 million in
the same period in 1995. The increase was primarily due the internal growth of
the Company's operations. The percentage of corporate, general and
administrative costs to net revenue was comparable for the three months ended
December 31, 1996 and 1995.
Provision for doubtful accounts consists of the amount of billed revenue that
management estimates will become uncollectible. During the three months ended
December 31, 1996, the Company's provision for doubtful accounts increased
approximately $0.3 million, or 28%, to $1.4 million from $1.1 million in the
same period in 1995. The increase is primarily due to the increase in total net
revenue and days sales outstanding. As a percentage of net revenue, the
provision for doubtful accounts is comparable for the three months ended
December 31, 1996 and 1995.
Depreciation and amortization expenses increased $0.3 million, or 25%, to
$1.4 million in the three months ended December 31, 1996 from $1.1 million in
the same period in 1995. The increase was primarily due to capital expenditures
for the purchase of rental equipment and the amortization of goodwill from the
Company's acquisitions. As a percentage of the Company's total net revenue,
depreciation and amortization costs were comparable for the three months ended
December 31, 1996 and 1995.
Interest expense increased $0.3 million, or 113%, to $0.6 million in the
three months ended December 31, 1996 from $0.3 million in the same period in
1995. The increase was primarily the result of an increase in the Company's
weighted average debt outstanding incurred to finance acquisitions and the
Company's internal growth.
Income tax expense increased $0.1 million, or 11%, to $1.1 million in the
three months ended December 31, 1996 from $1.0 million in the same period in
1995. This increase is due to an increase in the profitability of the Company.
LIQUIDITY AND CAPITAL RESOURCES
In December 1996, the Company and its primary bank amended and restated the
credit agreement ("1996 Amended and Restated Credit Agreement") to further
increase the amount of available financing to $60 million, consisting of a $50
million revolving loan and a $10 million term loan. An additional bank was added
to the credit agreement to expand the credit facility. Amounts available to
borrow under the amended credit facility are subject to certain limits as
defined in the agreement. As of December 31, 1996, the amount available under
the 1996 Amended and Restated Credit Agreement was $22.6 million. Borrowings
under this facility bear interest at LIBOR plus 1.5% or the Bank's prime rate,
at the Company's option. The interest rates under this facility at December 31,
1996 ranged from 8.25% to 7.06% per annum. Amounts outstanding under the
revolving loan are due in October 2000, and principal amounts outstanding under
the term loan are due in 14 quarterly installments beginning on March 31, 1997.
Outstanding borrowings under this facility at December 31, 1996 were
approximately $34.6 million ($24.6 million under the revolving loan and $10.0
million under the term loan).
The Company's operating cash flows are affected significantly by growth in
accounts receivable, largely as a result of the Company's net revenue growth.
For the three months ended December 31, 1996 and 1995, the Company's cash flows
from operations were affected by increases in accounts receivable balances of
$7.0 million and $7.5 million, respectively. These increases were due primarily
to volume growth and acquisitions. The Company's days sales outstanding ("DSO")
in accounts receivable was 107 days, 101 days and 95 days as of December 31,
1996, September 30, 1996 and December 31, 1995, respectively, based on the
annualized net revenue for the last quarter of the period. The increase in the
DSO is primarily attributable to the accelerated growth experienced by the
Company. The Company has taken measures to improve the DSO by investing in
additional accounts receivable staff and is completing the development of a new
billing and receivable management system on target for implementation in the
second quarter of fiscal 1997.
The Company's investments in property and equipment are attributable to
purchases of medical equipment that is rented to patients. The Company's
investments in the acquisition of businesses were $4.6 million and $0.5 million
respectively, for the three months ended December 31, 1996 and 1995.
The Company has recorded a net deferred tax asset in its consolidated
financial statements. Management believes that it is more likely than not
that the net deferred tax asset will be realized.
The Company intends to continue to expand its business primarily through
acquiring local and regional home health care companies, opening branch offices
in both new and existing markets and expanding the services currently provided
at its existing branch offices. Acquisitions to date have been financed with a
combination of cash generated from operations, borrowings under the Company's
credit facility and shares of Common Stock of the Company.
10
<PAGE>
Development costs of new branch offices include, among other things, lease
deposits and payments, and leasehold improvements and start-up costs, including
marketing and labor costs. Management believes that the Company's cash
commitment for each new branch office that delivers a full range of the
Company's services may approximate $500,000. Such costs will vary depending
upon inflation and the size and location of each facility and, accordingly, may
vary substantially from this approximation. Management expects that its current
plan to expand services at the Company's existing branch offices may require
funds of up to $2 million.
Management currently believes that internally generated funds and borrowings
under the Company's amended credit facilities will be adequate to satisfy the
Company's working capital requirements, including currently anticipated
expansion, through December 1997.
QUARTERLY OPERATING RESULTS AND SEASONALITY
The Company's quarterly results may vary significantly depending primarily on
factors such as rehospitalizations of patients, the timing of new branch office
openings and pricing pressures due to legislative and regulatory initiatives to
contain health care costs. The Company believes that its net revenue is
typically higher during the third and fourth quarters of its fiscal year due to
respiratory illnesses associated with the spring and summer months. As a result
of the above factors, the Company's operating results for any particular quarter
may not be indicative of the results for the full fiscal year.
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The 1997 Annual Meeting of Shareholders of the Company was held on
January 22, 1997. Proxies with regard to the matters to be voted upon
at the Annual Meeting were solicited under Regulation 14A of the
Securities Exchange Act of 1934, as amended. Set forth below is a brief
description of each matter voted upon at the Annual Meeting and the
results of the voting on each matter.
(a) Election of the two directors named below for a term of three years
expiring at the 2000 Annual Meeting of Shareholders. There was no
solicitation in opposition to any of the nominees listed in the
proxy statement, and all of the nominees were elected.
<TABLE>
<CAPTION>
Votes Broker
-------------------- ----------------------
Nominees For Withheld Abstentions Non-votes
- -------- --------- -------- ----------- ---------
<S> <C> <C> <C> <C>
Joseph D. Sansone 4,852,149 5,767 - -
Irving S. Shaprio 4,851,956 5,960 - -
</TABLE>
11
<PAGE>
(b) The approval of an amendment to the Company's Amended and Restated
Certificate of Incorporation to increase the authorized shares of Common
Stock from 8,000,000 to 80,000,000 shares.
Votes
- --------------------------------------------------------------------------------
For Against Abstentions
--- ------- -----------
3,799,204 1,054,892 3,820
(c) Ratification of the appointment of Ernst & Young LLP as independent
auditors of the Company for the fiscal year ending September 30, 1997.
Votes
- --------------------------------------------------------------------------------
For Against Abstentions
--- ------- -----------
4,819,254 36,252 2,410
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
--------
The following exhibits are filed as part of this Report:
3.1 Certificate of Amendment to the Amended and Restated Certificate of
Incorporation of Pediatric Services of America, Inc.
11.1 Computation of Earnings per Share
(b) Reports on Form 8-K
-------------------
The Company did not file a Current Report on Form 8-K during the quarter
ended December 31, 1996.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
PEDIATRIC SERVICES OF AMERICA, INC.
(REGISTRANT)
Date: February 13, 1997 By: Stephen M. Mengert
----------------------------
Stephen M. Mengert
Senior Vice President,
Chief Financial Officer,
Treasurer and Secretary
(Duly authorized officer and
Principal Financial Officer)
13
<PAGE>
INDEX OF EXHIBITS
PAGE NO.
--------
3.1 Certificate of Amendment to the Amended and Restated
Certificate of Incorporation of Pediatric Services of
America, Inc. .............................................. 15
11.1 Computation of Earnings per Share........................... 16
14
<PAGE>
EXHIBIT 3.1
CERTIFICATE OF AMENDMENT
OF
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
PEDIATRIC SERVICES OF AMERICA, INC.
PEDIATRIC SERVICES OF AMERICA, INC., a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify:
FIRST: That the Board of Directors of the Corporation, in accordance
with the provisions of Section 242 of the Delaware General Corporation Law, has
adopted at a meeting of all of the members of the Board of Directors held
October 25, 1996, an amendment to the Certificate of Incorporation of such
Corporation and declaring such amendments be advisable. The resolution setting
forth the proposed amendment is as follows:
RESOLVED, that the Board of Directors hereby declares it advisable
that the Certificate of Incorporation of the Corporation be amended by
deleting the present first sentence of Paragraph Fourth of the Certificate
of Incorporation, and replacing it with the following sentence:
"FOURTH: The total number of shares of all classes which the
------
Corporation has authority to issue is 80,000,000, of which 78,000,000
shares shall be designated as "Common Stock", and 2,000,000 shall be
designated as "Preferred Stock"."
SECOND: The actions of the Corporation's stockholders in approving the
aforesaid resolution was taken at the Annual Meeting of stockholders held
January 22, 1997, duly held in accordance with the provisions of the Delaware
General Corporation Law, and was approved by a vote of the requisite majority of
the number of outstanding shares of the Corporation.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Amendment to be signed by its President and attested by its Secretary this 31st
day of January, 1997.
PEDIATRIC SERVICES OF AMERICA, INC.
By: /s/ Joseph D. Sansone, President
---------------------------------
ATTEST:
By: /s/ Stephen M. Mengert, Secretary
-----------------------------------
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT 11.1
PEDIATRIC SERVICES OF AMERICA, INC.
COMPUTATION OF EARNINGS PER SHARE
THREE MONTHS ENDED DECEMBER 31,
-----------------------------------------------
PRIMARY FULLY DILUTED
---------------------- ----------------------
1996 1995 1996 1995
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Weighted average common stock
outstanding during the period.................. 6,247,567 5,719,361 6,247,567 6,042,917
Options and warrants.............................. 184,870 321,162 188,122 319,520
---------- ---------- ---------- ----------
Total............................................. 6,432,437 6,040,523 6,435,689 6,362,437
========== ========== ========== ==========
Net income attributable to
common and common equivalent shares:
Net Income..................................... $1,656,308 $1,489,440 $1,656,308 $1,489,440
Less accretion on redeemable preferred stock... - (6,097) - (6,097)
Less preferred stock dividend.................. - (51,450) - (51,450)
Net income attributable to common and
common equivalent shares...................... $1,656,308 $1,431,893 $1,656,308 $1,431,893
========== ========== ========== ==========
Net income per common and common equivalent
share......................................... $ 0.26 $ 0.24 $ 0.26 $ 0.23
========== ========== ========== ==========
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> SEP-30-1997 SEP-30-1996
<PERIOD-START> OCT-01-1996 OCT-01-1995
<PERIOD-END> DEC-31-1996 DEC-31-1995
<CASH> 579 770
<SECURITIES> 0 0
<RECEIVABLES> 63,625 56,268
<ALLOWANCES> 9,296 8,523
<INVENTORY> 0 0
<CURRENT-ASSETS> 61,469 54,565
<PP&E> 26,473 25,067
<DEPRECIATION> 12,589 11,644
<TOTAL-ASSETS> 109,840 98,736
<CURRENT-LIABILITIES> 20,233 18,893
<BONDS> 0 0
0 0
0 0
<COMMON> 62 62
<OTHER-SE> 55,804 54,131
<TOTAL-LIABILITY-AND-EQUITY> 109,840 98,736
<SALES> 0 0
<TOTAL-REVENUES> 46,554 36,910
<CGS> 0 0
<TOTAL-COSTS> 41,830 33,073
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 1,375 1,071
<INTEREST-EXPENSE> 575 270
<INCOME-PRETAX> 2,774 2,496
<INCOME-TAX> 1,118 1,007
<INCOME-CONTINUING> 1,656 1,489
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 1,656 1,489
<EPS-PRIMARY> $0.26 $0.24
<EPS-DILUTED> $0.26 $0.23
</TABLE>
