<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-Q
(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, 1997 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 0-24440
------------------------------
OCCUSYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-2543036
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3010 LBJ Freeway, Suite 400, Dallas, Texas 75234
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (972) 484-2700
Not applicable (Former name, former address and former fiscal year, if
changed since last report)
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 August 4, 1997, the number of shares outstanding of each of the
issuer's classes of common stock was as follows:
Common stock ..........21,695,887 shares, par value $.01 per share
================================================================================
<PAGE>
OCCUSYSTEMS, INC.
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
-------- --------
(Unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 12,478 $ 53,460
Short-term investments 37,828 12,045
Accounts receivable, net 47,561 38,699
Other current assets 7,192 7,013
-------- --------
Total current assets 105,059 111,217
-------- --------
Long-term investments 3,967 0
Property and equipment, net 41,984 35,674
Intangible assets, net 107,901 106,352
Other assets 8,631 7,376
-------- --------
Total assets $267,542 $260,619
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 555 $ 884
Accounts payable 1,732 2,073
Accrued expenses 7,863 11,989
-------- --------
Total current liabilities 10,150 14,946
Long-term debt, net of current portion 98,525 99,089
Other liabilities 16,864 14,043
-------- --------
Total liabilities 125,539 128,078
-------- --------
Stockholders' equity:
Common stock ($.01 par value, 50,000,000 shares
authorized, 21,643,285 and 21,350,477 shares
issued and outstanding at June 30, 1997,
and December 31, 1996, respectively) 216 214
Additional paid-in capital 144,668 143,043
Accumulated deficit (2,881) (10,716)
-------- --------
Total stockholders' equity 142,003 132,541
-------- --------
Total liabilities and stockholders' equity $267,542 $260,619
======== ========
</TABLE>
See accompanying notes.
<PAGE>
OCCUSYSTEMS, INC.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
--------------------------- -------------------------
1997 1996 1997 1996
------- ------ ------- -------
<S> <C> <C> <C> <C>
Revenues:
Net revenues $52,665 $43,246 $99,048 $81,577
Costs and expenses:
Operating expenses 37,130 31,815 71,763 62,313
General and administrative 4,064 4,062 7,940 7,675
Depreciation and amortization 2,316 1,616 4,455 3,102
------- ------- ------- -------
Total costs and expenses 43,510 37,493 84,158 73,090
------- ------- ------- -------
Operating income 9,155 5,753 14,890 8,487
Other (income) expense:
Interest expense 1,702 450 3,300 1,010
Interest income (759) (53) (1,584) (100)
Minority interest 303 116 499 103
Other, net 179 115 310 193
------- ------- ------- -------
Total other expense 1,425 628 2,525 1,206
------- ------- ------- -------
Income from operations before taxes 7,730 5,125 12,365 7,281
Provision for income taxes 2,705 1,859 4,327 2,740
------- ------- ------- -------
Net income $ 5,025 $ 3,266 8,038 $ 4,541
======= ======= ======= =======
Earnings per common and common equivalent share:
Net income $ 0.23 $ 0.15 $ 0.36 $ 0.22
======= ======= ======= =======
Shares used in earnings per common and common
equivalent share computation 22,326 22,081 22,321 21,871
======= ======= ======= =======
</TABLE>
See accompanying notes.
<PAGE>
OCCUSYSTEMS, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
<TABLE>
<CAPTION>
Six months ended June 30,
------------------------
1997 1996
-------- --------
<S> <C> <C>
Net cash used in operating activities $ (500) $ (260)
-------- --------
Cash flows from investing activities:
Purchases of property and equipment, net (8,543) (7,244)
Purchases of investments (29,750) 0
Cash paid for acquisitions, net of cash received (3,288) (8,711)
-------- --------
Net cash used in investing activities (41,581) (15,955)
-------- --------
Cash flows from financing activities:
Proceeds from exercise of stock options and warrants 424 1,451
Payment of dividends 0 (406)
Proceeds from the issuance of long-term debt 0 13,630
Proceeds from joint venture capitalization 1,262 0
Payments on long-term debt and capital leases (587) (1,009)
-------- --------
Net cash provided by financing activities 1,099 13,666
-------- --------
Net decrease in cash (40,982) (2,549)
Cash and cash equivalents at beginning of period 53,460 7,735
-------- --------
Cash and cash equivalents at end of period $ 12,478 $ 5,186
======== ========
</TABLE>
See accompanying notes.
<PAGE>
OCCUSYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. PRESENTATION
The balance sheet data at June 30, 1997, the statement of operations
data for the three and six month periods ended June 30, 1997 and 1996, and the
statement of cash flows data for the six month periods ended June 30, 1997 and
1996, have been derived from unaudited consolidated financial statements which,
in the opinion of the management of OccuSystems, Inc. (the "Company"), reflect
all adjustments, consisting only of normal recurring accruals, necessary for a
fair presentation of the financial position and results of operations of the
Company for those periods.
NOTE 2. EARNINGS PER SHARE
Earnings per common and common equivalent share are based upon the
weighted average number of common shares outstanding adjusted for the dilutive
effect of common stock equivalents consisting of stock options, warrants, and
convertible debt. Fully diluted earnings per common and common equivalent share
are not presented because such amounts approximate earnings per common and
common equivalent share.
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128 ("SFAS 128") Earnings Per
Share. SFAS 128 establishes new standards for computing and presenting earnings
per share ("EPS"). Implementation of SFAS 128 is required for all financial
statements issued subsequent to December 15, 1997 but requires proforma
disclosure in financial statements issued prior to that date.
<TABLE>
<CAPTION>
Three Months Ended June 30, Per Share
Income Shares Amounts
------ ------ --------
<S> <C> <C> <C>
1997
Net Income $ 5,025
--------
BASIC EARNINGS PER SHARE
Income available to common shareholders 5,025 21,627 $.23
----
EFFECT OF DILUTIVE SECURITIES
Options and warrants 686
Convertible debt 2 26
-------- ------
DILUTED EARNINGS PER SHARE
Income available to common shareholders
plus assumed conversions $ 5,027 22,339 $.23
-------- ------ ----
1996
Net Income $ 3,266
--------
BASIC EARNINGS PER SHARE
Income available to common shareholders 3,266 20,962 $.16
----
EFFECT OF DILUTIVE SECURITIES
Options and warrants 1,118
Convertible debt 10 124
-------- ------
DILUTED EARNINGS PER SHARE
Income available to common shareholders
plus assumed conversions $ 3,276 22,204 $.15
-------- ------ ----
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Six Months Ended June 30, Per Share
Income Shares Amounts
------ ------ -------
<S> <C> <C> <C>
1997
Net Income $ 8,038
--------
BASIC EARNINGS PER SHARE
Income available to common shareholders 8,038 21,601 $.37
----
EFFECT OF DILUTIVE SECURITIES
Options and warrants 713
Convertible debt 4 27
-------- ------
DILUTED EARNINGS PER SHARE
Income available to common shareholders
plus assumed conversions $ 8,042 22,341 $.36
-------- ------ ----
1996
Net Income $ 4,541
--------
BASIC EARNINGS PER SHARE
Income available to common shareholders 4,541 20,207 $.22
----
EFFECT OF DILUTIVE SECURITIES
Options and warrants 1,066
Convertible debt 171 159
-------- ------
DILUTED EARNINGS PER SHARE
Income available to common shareholders
plus assumed conversions $ 4,712 21,432 $.22
-------- ------ ----
</TABLE>
Recalculation of the 1996 EPS in conformity with FASB 128 does not change the
primary or fully diluted per share amounts previously reported.
The Company has convertible subordinated notes outstanding at June 30, 1997 (see
Note 5), which could be converted into 3,291,246 shares. These shares were not
included in the computation of earnings per share as the option exercise price
was greater than the average market price of the common shares.
NOTE 3. BUSINESS COMBINATIONS
On April 21, 1997, the Company entered into an Agreement and Plan of
Reorganization with CRA Managed Care, Inc. ("CRA") and Concentra Managed Care,
Inc. ("Concentra"), pursuant to which (i) the Company will be merged with and
into Concentra and a wholly-owned subsidiary of Concentra will be merged with
and into CRA, (ii) each share of the Company's common stock will be converted
into one share of Concentra common stock and (iii) each share of CRA's common
stock will be converted into 1.786 shares of Concentra common stock.
NOTE 4. PROPERTY AND EQUIPMENT
Property and equipment consisted of the following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
----------- -------------
<S> <C> <C>
Land $ 2,567 $ 1,815
Building and improvements 5,650 4,038
Furniture and equipment 34,233 30,674
Leasehold improvements 16,690 13,099
--------- ---------
59,140 49,626
Accumulated depreciation ( 17,156) ( 13,952)
--------- ---------
$ 41,984 $ 35,674
========= =========
</TABLE>
<PAGE>
NOTE 5. LONG-TERM DEBT
Long-term debt consisted of the following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
---------- ------------
<S> <C> <C>
Convertible subordinated notes,
interest at 6%, due December 2001.......... $97,750 $97,750
Convertible notes payable, interest at
6%; payable through September 1999......... 185 785
Notes payable to various holders,
interest ranging from 5.5% to 10%,
payable in installments through 2005....... 403 304
Obligations under capital leases............ 742 1,134
------- -------
99,080 99,973
Less: Current maturities................. ( 555) ( 884)
------- -------
$98,525 $99,089
======= =======
</TABLE>
The maturities of long-term debt at June 30, 1997, are as follows (in
thousands):
1997 $ 262
1998 484
1999 438
2000 51
2001 97,766
Thereafter 79
-------
$99,080
=======
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
- --------
As a physician practice management company focusing on occupational healthcare,
OccuSystems manages occupational healthcare centers at which it provides support
personnel, marketing, information systems, and management services to its
affiliated physicians. OccuSystems owns all of the operating assets of the
occupational healthcare centers, including leasehold interests and medical
equipment. The Company derives its net patient service revenues primarily from
the diagnosis, treatment and management of work-related injuries and illnesses
and from other occupational healthcare services such as employment-related
physical examinations, drug and alcohol testing, functional capacity testing and
other related programs. For the six month period ended June 30, 1997, the
Company derived 63% of its net revenues from the treatment of work-related
injuries and illnesses and 37% of its net revenues from non-injury related
medical services.
Physician and physical therapy services are provided at the Company's centers
under management agreements with affiliated physician associations (the
"Physician Groups"), which are organized professional corporations that hire
licensed physicians and physical therapists to provide medical services to the
centers' patients. Under these agreements, all revenues derived from medical
services provided by the physicians and physical therapists employed by the
Physician Groups are revenues of the Physician Groups and the compensation,
benefits and other payments to these physicians and physical therapists, and
malpractice insurance premiums and other miscellaneous expenses associated with
these providers are expenses of the Physician Groups.
The Company receives management fees under these agreements equal to the
revenues of the Physician Groups less these expenses (100% of the residual
interest). However, since the Company effectively controls the Physician
Groups, the Company's consolidated results of operations reflect the revenues
generated by the Physician Groups and the costs associated with the delivery of
their services. The financial statements of the Physician Groups are
consolidated because the Company has unilateral control over the assets and
operations of the Physician Groups and notwithstanding the lack of technical
majority ownership, consolidation of the Physician Groups with the Company is
necessary to present fairly the financial position and results of operations of
the Company because of the existence of a parent-subsidiary relationship by
means other than record ownership of the Physician Groups' voting stock.
The shareholders of the Physician Groups are the physician leaders of the
Company, and are employed by the Company or one of its wholly-owned
subsidiaries. Through a shareholder agreement, the Company restricts any
transfer of Physician Group ownership without its consent and can require the
holder of such shares to transfer ownership to a Company designee upon the
occurrence of certain events, including but not limited to the cessation of
employment. Control of the Physician Groups is perpetual and other than
temporary because of the nature of the relationship and the management
agreements between the entities. The employed physicians do not control fee
schedules, payor contracts, or employment decisions regarding personnel. The
risk of loss of billed services provided by the
<PAGE>
Physician Groups resides ultimately with the Company as OccuSystems is required
to provide financial support on an as needed basis.
OccuSystems, through its wholly owned subsidiary, OccuCenters, Inc., is a
partner in several joint venture arrangements with various hospitals. These
joint ventures were established to operate occupational medicine centers in
certain areas of the country.
These joint ventures include (i) Tucson Occupational Medicine Partnership, an
Arizona general partnership, (ii) O.H.C. of Oklahoma L.L.C., an Oklahoma limited
liability company, (iii) Concentra Iowa L.L.C., an Iowa limited liability
company, (iv) Concentra Occupational Healthcare Harrisburg, L.P., and (v)
Concentra Arkansas L.L.C., a Delaware limited liability company.
OccuCenters has a management agreement with each of the joint ventures to
provide management services to the joint ventures. As the manager of the
respective hospital joint ventures, OccuCenters' responsibilities include the
provision of all management, development, and administrative services attendant
to each venture's business. OccuCenter's obligations include the management of
all personnel, payroll and employee benefits as each venture's employees are
leased from OccuCenters. OccuCenters must also manage the billing and
collection function, including the establishment of pricing schedules for
patient services, risk management, marketing, information systems, financial
reporting, tax and accounting matters, real estate issues and patient
scheduling. Furthermore, OccuCenters grants to each venture the use of any and
all trade names of OccuCenters.
The hospital partners are precluded from competing with the business of the
ventures in the geographic areas served by the ventures and are prohibited from
transferring any or all of their ownership interest without prior written
consent of OccuCenters. The hospital partners and OccuCenters are jointly
responsible for any powers, duties, and responsibilities vested by law.
As compensation for the management of the respective ventures, OccuCenters is
paid a monthly fee which is calculated based upon net revenues. This fee is
retained by OccuCenters out of the operating revenue of each venture. The
management fees paid to OccuCenters under these arrangements range from 7% to
14% of net revenues.
Because of OccuSystems' effective control of these joint ventures through its
ownership percentages and management agreements, the financial statements of the
joint ventures are consolidated with those of OccuSystems.
The Company's rapid growth has resulted primarily from acquisitions of practices
principally engaged in occupational healthcare. Since December 1, 1991, the
Company has completed 55 acquisition transactions involving 114 physician
practices and has developed another 32 physician practices. As of August 4,
1997, the Company operated 121 centers located in 16 states and served 32
markets.
<PAGE>
The following table provides certain information concerning the Company's
acquisition and development of practices during the periods indicated:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED DECEMBER 31 JUNE 30,1997
-------------------------------- ----------------
1992 1993 1994 1995 1996
<S> <C> <C> <C> <C> <C> <C>
Practices acquired during the period (1) .......... 16 9 17 24 32 6
Practices developed during the period.............. 2 3 6 3 10 7
Number of centers at end of period (2)............. 24 36 54 71 109 120
Number of affiliated physicians at end of
period............................................. 45 72 95 129 196 216
Same market revenue growth (3)..................... 16.5% 33.8% 13.4% 12.2% 10.7% 10.5%
</TABLE>
- ----------------
(1) Represents practices the assets of which were acquired during each period
presented and not subsequently divested.
(2) Does not include practices the assets of which were acquired and
subsequently divested or consolidated into existing centers within a market.
(3) Same market revenue growth sets forth the aggregate net change from the
prior period for all markets in which the Company has operated for longer
than one year (excluding revenue growth due to acquisitions of additional
centers).
THREE MONTHS ENDED JUNE 30, 1997 AND 1996
NET REVENUES
- ------------
Net revenues increased 21.8% from $43,246,000 in the second quarter of 1996 to
$52,665,000 in the second quarter of 1997. Of this increase, $1,469,000
resulted from practices acquired during 1997, $3,616,000 resulted from practices
acquired in 1996 and developed in new markets during 1996 and 1997, $3,927,000
resulted from increased business in same markets (11.0% same market increase),
and $407,000 resulted from consulting and other ancillary services.
OPERATING EXPENSES
- ------------------
Operating expenses increased 16.7% from $31,815,000 in the second quarter of
1996 to $37,130,000 in the second quarter of 1997. This increase was
principally related to the practices acquired in 1997 and to practices acquired
and developed during 1996. Operating expenses as a percentage of net revenues
decreased from 73.6% in the second quarter of 1996 to 70.5% in the second
quarter of 1997. For centers owned during the second quarter of 1997 and 1996,
operating expenses decreased 1.8% from 72.1% in the second quarter of 1996 to
70.3% in the second quarter of 1997.
The practices acquired and developed during 1997 contributed operating margins
of 15.2%, as compared to the practices owned prior to 1997, which produced
operating margins of 29.9%. As certain functions are consolidated and other
staff-related changes occur, the operating margins of acquired practices have
tended to improve over time.
<PAGE>
GENERAL AND ADMINISTRATIVE
- --------------------------
General and administrative expenses increased from $4,062,000 in the second
quarter of 1996 to $4,064,000 in the second quarter of 1997. As a percentage of
net revenues, these costs decreased from 9.4% in the second quarter of 1996 to
7.7% in the second quarter of 1997. The decrease in expenses as a percentage of
net revenues from 1996 to 1997 is primarily attributable to the elimination of
duplicate costs through the integration of acquired entities, as well as
economies of scale gained through continued expansion in existing markets.
DEPRECIATION AND AMORTIZATION
- -----------------------------
Depreciation and amortization expense increased 43.3% from $1,616,000 in the
second quarter of 1996 to $2,316,000 in the second quarter of 1997. This
increase resulted primarily from centers acquired in 1996 and 1997, as well as
the depreciation expense attributable to the rollout of the Company's new
proprietary information system. As a percentage of net revenues, this expense
increased from 3.7% in 1996 to 4.4% in 1997.
INTEREST EXPENSE
- ----------------
Interest expense increased from $450,000 in the second quarter of 1996 to
$1,702,000 in the second quarter of 1997. This increase is primarily due to the
issuance of $97.8 million of 6% convertible subordinated notes in December,
1996. As a percentage of net revenues, this expense increased from 1.0% during
the second quarter of 1996 to 3.2% in the second quarter of 1997.
INTEREST INCOME
- ---------------
Interest income increased from $53,000 in the second quarter of 1996 to $759,000
in the second quarter of 1997. This increase is primarily due to the investment
of the net proceeds, after retirement of $23.7 million in bank debt, from the
issuance of $97.8 million of 6% convertible subordinated notes in December,
1996.
SIX MONTHS ENDED JUNE 30, 1997 AND 1996
NET REVENUES
- ------------
Net revenues increased 21.4% from $81,577,000 in the first six months of 1996 to
$99,048,000 in the first six months of 1997. Of this increase, $2,746,000
resulted from practices acquired during 1997, $7,321,000 resulted from practices
acquired in 1996 and developed in new markets during 1996 and 1997, $6,602,000
resulted from increased business in same markets (10.5% same market increase),
and $802,000 resulted from consulting and other ancillary services.
OPERATING EXPENSES
- ------------------
Operating expenses increased 15.2% from $62,313,000 in the first six months of
1996 to $71,763,000 in the first six months of 1997. This increase was
<PAGE>
principally related to the practices acquired in 1997 and to practices acquired
and developed during 1996. Operating expenses as a percentage of net revenues
decreased from 76.4% in the first six months of 1996 to 72.5% in the first six
months of 1997. For centers owned during the first six months of 1997 and 1996,
operating expenses decreased 2.8% from 75.2% in the first six months of 1996 to
72.4% in the first six months of 1997.
The practices acquired and developed during 1997 contributed operating margins
of 15.2%, as compared to the practices owned prior to 1997, which produced
operating margins of 27.5%. As certain functions are consolidated and other
staff-related changes occur, the operating margins of acquired practices have
tended to improve over time.
GENERAL AND ADMINISTRATIVE
- --------------------------
General and administrative expenses increased 3.5% from $7,675,000 in the first
six months of 1996 to $7,940,000 in the first six months of 1997. As a
percentage of net revenues, these costs decreased from 9.4% in the first six
months of 1996 to 8.0% in the first six months of 1997. The decrease in expenses
as a percentage of net revenues from 1996 to 1997 is primarily attributable to
the elimination of duplicate costs through the integration of acquired entities,
as well as economies of scale gained through continued expansion in existing
markets.
DEPRECIATION AND AMORTIZATION
- -----------------------------
Depreciation and amortization expense increased 43.6% from $3,102,000 in the
first six months of 1996 to $4,455,000 in the first six months of 1997. This
increase resulted primarily from centers acquired in 1996 and 1997, as well as
the depreciation expense attributable to the rollout of the Company's new
proprietary information system. As a percentage of net revenues, this expense
increased from 3.8% in 1996 to 4.5% in 1997.
INTEREST EXPENSE
- ----------------
Interest expense increased from $1,010,000 in the first six months of 1996 to
$3,300,000 in the first six months of 1997. This increase is primarily due to
the issuance of $97.8 million of 6% convertible subordinated notes in December,
1996. As a percentage of net revenues, this expense increased from 1.2% during
the first six months of 1996 to 3.3% in the first six months of 1997.
INTEREST INCOME
- ---------------
Interest income increased from $100,000 in the first six months of 1996 to
$1,584,000 in the first six months of 1997. This increase is primarily due to
the investment of the net proceeds, after retirement of $23.7 million in bank
debt, from the issuance of $97.8 million of 6% convertible subordinated notes in
December, 1996.
<PAGE>
INCOME TAXES
- ------------
The Company's effective tax rate decreased from 37.6% for the six months ended
June 30, 1996 to 35% for the six months ended June 30, 1997. This decrease was
due to a reduction in the deferred tax asset valuation allowance, initially
recorded in 1993, as a result of positive evidence with respect to the ultimate
realization of the deferred tax asset.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
At June 30, 1997, the Company had $94.9 million in working capital, a decrease
of $1.4 million from December 31, 1996. The Company's principal sources of
liquidity consisted of (i) cash and cash equivalents aggregating $12.5 million,
(ii) short-term investments of $37.8 million, (iii) net accounts receivable of
$47.6 million, and (iv) $60.0 million in borrowing capacity under a revolving
loan agreement with Creditanstalt-Bankverein ("the Loan Agreement").
Cash and cash equivalents decreased $41.0 million from $53.5 million as of
December 31, 1996 to $12.5 million as of June 30, 1997. This decrease is
primarily the result of the purchase of short-term investments of $25.8 million
and long-term investments of $4.0 million and purchases of property and
equipment of $8.5 million in the first six months of 1997.
The Company anticipates that funds generated from operations, cash and cash
equivalents, and funds available under the Loan Agreement, will be sufficient to
meet working capital requirements, debt obligations, and finance any necessary
capital expenditures for the foreseeable future. Expansion of the Company's
business through acquisitions, development centers, and joint ventures may
require additional funds, which, to the extent not provided by internally
generated sources, cash and cash equivalents, investments and the Loan
Agreement, would require the Company to seek additional debt or equity
financing.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 11 - Statement re Computation of Earnings Per Common and
Common Equivalent Share.
(b) Reports on Form 8-K:
On April 23, 1997, the Company filed a report on Form 8-K announcing
the Company's agreement to a merger with CRA Managed Care, Inc. (See Note 3).
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.
OccuSystems, Inc.
Date: August 7, 1997 /s/ JOHN K. CARLYLE
-----------------------------------
John K. Carlyle
Chairman and Chief Executive Officer
/s/ JAMES M. GREENWOOD
-----------------------------------
James M. Greenwood
Senior Vice President and
Chief Financial Officer
(Principal Accounting Officer)
<PAGE>
Exhibit 11
OccuSystems, Inc.
Net Income by Quarter for 1997 and 1996
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
----------------- -----------------
6/30/97 6/30/96 6/30/97 6/30/96
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net Income $ 5,025 $ 3,266 $ 8,038 $ 4,541
Interest on Common Stock Equivalents, net of tax 2 10 4 171
------- ------- ------- -------
Primary Earnings $ 5,027 $ 3,276 $ 8,042 $ 4,712
======= ======= ======= =======
Wtd. Average Shares 22,326 22,081 22,321 21,871
Net Income per share $ 0.23 $ 0.15 $ 0.36 $ 0.22
Weighted Common Shares Outstanding 21,627 20,962 21,601 20,207
Weighted Common Share Equivalents Outstanding 699 1,119 720 1,664
------- ------- ------- -------
Weighted Average Shares Outstanding 22,326 22,081 22,321 21,871
======= ======= ======= =======
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1996
<PERIOD-START> APR-01-1997 DEC-31-1996
<PERIOD-END> JUN-30-1997 JUN-30-1997
<CASH> 12,478 0
<SECURITIES> 41,795 0
<RECEIVABLES> 47,561 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 105,059 0
<PP&E> 41,984 0
<DEPRECIATION> (17,156) 0
<TOTAL-ASSETS> 267,542 0
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0 0
0 0
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<OTHER-SE> 141,787 0
<TOTAL-LIABILITY-AND-EQUITY> 267,542 0
<SALES> 52,665 99,048
<TOTAL-REVENUES> 52,665 99,048
<CGS> 37,130 71,763
<TOTAL-COSTS> 43,510 84,158
<OTHER-EXPENSES> 1,425 2,525
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 1,702 3,300
<INCOME-PRETAX> 7,730 12,365
<INCOME-TAX> 2,705 4,327
<INCOME-CONTINUING> 5,025 8,038
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 5,025 8,038
<EPS-PRIMARY> .23 .36
<EPS-DILUTED> .23 .36
</TABLE>
