FONAR Announces Fiscal 2014 Second Quarter Earnings Results
MELVILLE, NY--(Marketwired - Feb 14, 2014) - FONAR
Corporation (NASDAQ: FONR),
- Second Fiscal 2014 Quarter Net Revenues increase 83% over
Second Fiscal Quarter 2013 to $17.6 million.
- Second Fiscal 2014 Quarter Net Income increases 88% over
Second Fiscal Quarter 2013 to $3.0 million
- Diluted EPS Available to Common Stockholders for the Second
Fiscal 2014 Quarter was $0.33, an increase of 57% over Second
Fiscal Quarter 2013
- FONAR records Fifthteenth straight quarter of
positive Net Income and Income from Operations of which most recent
ten were greater than $1.5 Million
FONAR Corporation (NASDAQ: FONR), The Inventor of MR Scanning™,
reported its second quarter, fiscal 2014 results for the quarter
ended December 31, 2013. The Company's two industry segments
include the management of 23 Stand-Up® MRI (UPRIGHT® MRI) centers
as well as its traditional MRI development, manufacturing and
service business. Its stellar product line includes the FONAR
UPRIGHT® Multi-Position™ MRI (aka STAND-UP® MRI which enables
full weight-bearing MRI imaging and is particularly
powerful in the gravity sensitive regions of the human anatomy,
e.g. the spine, brain, hip, knee, ankle, foot, shoulder, and
pelvis. The FONAR UPRIGHT® Multi-Position™ MRI scanner is the
world's only MRI scanner licensed under FONAR's multiple UPRIGHT®
MRI patents to scan all the patient's body parts in their normal
fully weight-bearing UPRIGHT® position.
Statement of Operations
Items
Income from operations for the quarter ended December 31, 2013,
increased 91% to $3.3 million, as compared to $1.7 million for the
same period one year earlier. For the six month period ended
December 31, 2013, income from operations was $7.4 million as
compared to $3.6 million during the corresponding period one year
earlier, an increase of 104%.
Net Income for the quarter ended December 31, 2013, increased
88% to $3.0 million, as compared to $1.6 million for the same
period one year earlier. For the six month period ended
December 31, 2013, net income was $6.7 million as compared to $3.4
million during the corresponding period one year earlier, an
increase of 96%.
Diluted Net Income per Common Share available to Common
shareholders for the quarter ended December 31, 2013 increased 57%
to $0.33, as compared to $0.21 for the same period one year
earlier.
For the six month period ended December 31, 2013, Diluted Net
Income per Common Share available to Common shareholders increased
63% to $0.70, as compared to $0.43 for the same period one year
earlier.
Total revenues for the quarter ended December 31, 2013,
increased 83% to $17.6 million as compared to $9.6 million during
the same period one year earlier. For the six month period ended
December 31, 2013, total revenues increased 80% to $34.4 million as
compared to $19.1 million, one year earlier.
Revenue from the patient fee segment and management and other
fees segment, for the quarter ended December 31, 2013, increased
149% to $14.3 million, as compared to $5.7 million during the same
period one year earlier. At six months this also increased
149% to $28.5 million as compared to the same period one year
earlier at $11.5 million. This is the revenue that comes from
patient fees and the management of the 23 FONAR Stand-Up™ MRI
diagnostic imaging centers, by FONAR's HMCA subsidiary.
Balance Sheet
Items
At December 31, 2013, total current assets were $43.5 million,
total assets were $77.1 million, total current liabilities were
$23.2 million, and total long-term liabilities were $11.8
million.
At December 31, 2013, total cash and cash equivalents were $9.4
million.
At December 31, 2013, total stockholder's equity was $42.1
million.
See the accompanying tables for more details.
Recent Significant
Events
In December, 2013, the Company settled a two-year old patent
infringement case brought against it. The infringement action
alleged that FONAR's Upright® MRI scanners infringe plaintiff's
patent which relates to the moving of a patient into the
scanner. The Company took the position that the plaintiff's
claims were without merit and that their patent was
invalid. The parties have settled the case and while FONAR
will pay $150,000, there are certain licenses and covenants not to
sue again.
Management
Discussion
The acquisition of Health Diagnostic Management (HDM) has been a
significant source of profitability for the Company. The
diluted earnings per share available for the common stockholder for
the six months which ended on December 31, 2013 increased 63% to
$0.70 when compared to one year earlier. The Company plans to
continue to grow at a reasonable pace while maintaining its highly
profitable profile."
About FONAR
FONAR (NASDAQ: FONR), Melville, NY, The Inventor of MR
Scanning™, was incorporated in 1978, and is the first, oldest and
most experienced MRI company in the industry. FONAR introduced the
world's first commercial MRI in 1980, and went public in 1981.
Since its inception, nearly 300 recumbent-OPEN MRIs and 157
UPRIGHT® Multi-Position™ MRI scanners have been installed
worldwide. FONAR's stellar product is the UPRIGHT® MRI (also known
as the Stand-Up® MRI), the only whole-body MRI that performs
Position™ imaging (pMRI™) and scans patients in numerous
weight-bearing positions, i.e. standing, sitting, in flexion and
extension, as well as the conventional lie-down position. The FONAR
UPRIGHT® MRI often sees the patient's problem that other scanners
cannot because they are lie-down and "weightless" only scanners.
The patient-friendly UPRIGHT® MRI has a near-zero claustrophobic
rejection rate by patients. As a FONAR customer states, "If the
patient is claustrophobic in this scanner, they'll be
claustrophobic in my parking lot." Approximately 85% of patients
are scanned sitting while they watch a 42" flat screen TV. FONAR is
headquartered on Long Island, New York.
UPRIGHT® and STAND-UP® are registered trademarks and The
Inventor of MR Scanning™, Full Range of
Motion™, Multi-Position™, Upright Radiology™, The Proof is in
the Picture™, True Flow™, pMRI™, Spondylography™,
Dynamic™,Spondylometry™, CSP™, and Landscape™, are trademarks of
FONAR Corporation.
This release may include forward-looking statements from the
company that may or may not materialize. Additional information on
factors that could potentially affect the company's financial
results may be found in the company's filings with the Securities
and Exchange Commission.
|
|
FONAR CORPORATION AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(AMOUNTS AND SHARES IN THOUSANDS,EXCEPT PER SHARE
AMOUNTS) |
(UNAUDITED) |
|
ASSETS |
|
ASSETS |
|
December 31, 2013 |
|
June 30, 2013 |
Cash and cash equivalents |
|
$ |
9,425 |
|
$ |
7,871 |
Accounts receivable - net |
|
|
5,359 |
|
|
4,444 |
Accounts receivable - related party |
|
|
60 |
|
|
- |
Medical receivable - net |
|
|
8,884 |
|
|
8,126 |
Management and other fees receivable - net |
|
|
12,347 |
|
|
11,466 |
Management and other fees receivable - related medical practices -
net |
|
|
2,985 |
|
|
2,382 |
Inventories |
|
|
2,562 |
|
|
2,077 |
Prepaid expenses and other current assets |
|
|
1,901 |
|
|
1,500 |
Total Current Assets |
|
|
43,523 |
|
|
37,866 |
|
|
|
|
|
|
|
Property and equipment - net |
|
|
16,538 |
|
|
17,524 |
Goodwill |
|
|
1,767 |
|
|
1,767 |
Other intangible assets - net |
|
|
11,271 |
|
|
11,904 |
Deferred income tax asset |
|
|
2,936 |
|
|
2,936 |
Other assets |
|
|
1,050 |
|
|
1,154 |
Total Assets |
|
$ |
77,085 |
|
$ |
73,151 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
LIABILITIES |
|
December 31, 2013 |
|
June 30, 2013 |
Current Liabilities: |
|
|
|
|
|
|
|
Current portion of long-term debt and capital
leases |
|
$ |
3,048 |
|
$ |
2,886 |
|
Accounts payable |
|
|
2,941 |
|
|
2,752 |
|
Other current liabilities |
|
|
9,401 |
|
|
8,636 |
|
Unearned revenue on service contracts |
|
|
5,725 |
|
|
4,965 |
|
Unearned revenue on service contracts - related
party |
|
|
55 |
|
|
- |
|
Customer advances |
|
|
2,041 |
|
|
1,858 |
|
Income tax payable |
|
|
- |
|
|
20 |
|
|
Total Current Liabilities |
|
|
23,211 |
|
|
21,117 |
|
|
|
|
|
|
|
Long-Term Liabilities: |
|
|
|
|
|
|
|
Due to related medical practices |
|
|
229 |
|
|
231 |
|
Long-term debt and capital leases, less current
portion |
|
|
10,530 |
|
|
12,887 |
|
Deferred income tax liability |
|
|
462 |
|
|
462 |
|
Other liabilities |
|
|
596 |
|
|
654 |
|
|
Total Long-Term Liabilities |
|
|
11,817 |
|
|
14,234 |
|
|
Total Liabilities |
|
|
35,028 |
|
|
35,351 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FONAR CORPORATION AND SUBSIDIARIES |
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|
(AMOUNTS AND SHARES IN THOUSANDS,EXCEPT PER SHARE
AMOUNTS) |
|
(UNAUDITED) |
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY (Continued) |
|
|
|
STOCKHOLDERS' EQUITY: |
|
December 31, 2013 |
|
|
June 30, 2013 |
|
Class A non-voting preferred stock $.0001 par value; 453 shares
authorized at December 31, 2013 and June 30, 2013, 313 issued and
outstanding at December 31, 2013 and June 30, 2013 |
|
|
- |
|
|
|
- |
|
Preferred stock $.001 par value; 567 shares authorized at December
31, 2013 and June 30, 2013, issued and outstanding - none |
|
|
- |
|
|
|
- |
|
Common Stock $.0001 par value; 8,500 shares authorized at December
31, 2013 and June 30, 2013, 6,022 and 5,981 issued at December 31,
2013 and June 30, 2013, respectively; 6,010 and 5,969 outstanding
at December 31, 2013 and June 30, 2013, respectively |
|
|
1 |
|
|
|
1 |
|
Class B Common Stock (10 votes per share) $ .0001 par value; 227
shares authorized at December 31, 2013 and June 30, 2013, .146
issued and outstanding at December 31, 2013 and June 30, 2013 |
|
|
- |
|
|
|
- |
|
Class C Common Stock (25 votes per share) $.0001 par value; 567
shares authorized at December 31, 2013 and June 30, 2013, 383
issued and outstanding at December 31, 2013 and June 30, 2013 |
|
|
- |
|
|
|
- |
|
Paid-in capital in excess of par value |
|
|
174,770 |
|
|
|
174,499 |
|
Accumulated deficit |
|
|
(155,075 |
) |
|
|
(159,655 |
) |
Notes receivable from employee stockholders |
|
|
(42 |
) |
|
|
(55 |
) |
Treasury stock, at cost - 12 shares of common stock at December 31,
2013 and June 30, 2013 |
|
|
(675 |
) |
|
|
(675 |
) |
Total Fonar Corporation Stockholder Equity |
|
|
18,979 |
|
|
|
14,115 |
|
Non controlling interests |
|
|
23,078 |
|
|
|
23,685 |
|
|
|
|
|
|
|
|
|
|
Total Stockholders' Equity |
|
|
42,057 |
|
|
|
37,800 |
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders' Equity |
|
$ |
77,085 |
|
|
$ |
73,151 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FONAR CORPORATION AND SUBSIDIARIES |
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
|
(AMOUNTS AND SHARES IN THOUSANDS,EXCEPT PER SHARE
AMOUNTS) |
|
(UNAUDITED) |
|
|
|
|
|
FOR THE THREE MONTHS ENDED DECEMBER 31, |
|
REVENUES |
|
2013 |
|
|
2012 |
|
|
Product sales - net |
|
$ |
755 |
|
|
$ |
1,080 |
|
|
Service and repair fees - net |
|
|
2,548 |
|
|
|
2,765 |
|
|
Service and repair fees - related parties - net |
|
|
28 |
|
|
|
28 |
|
|
Patient fee revenue, net of contractual allowances and
discounts |
|
|
5,894 |
|
|
|
- |
|
|
Provision for bad debts for patient fee |
|
|
(2,223 |
) |
|
|
- |
|
|
Management and other fees - net |
|
|
8,274 |
|
|
|
3,775 |
|
|
Management and other fees - related medical practices -
net |
|
|
2,333 |
|
|
|
1,965 |
|
|
|
Total Revenues - Net |
|
|
17,609 |
|
|
|
9,613 |
|
|
|
|
|
|
|
|
|
|
|
|
COSTS AND EXPENSES |
|
|
|
|
|
|
|
|
|
Costs related to product sales |
|
|
631 |
|
|
|
904 |
|
|
Costs related to service and repair fees |
|
|
587 |
|
|
|
894 |
|
|
Costs related to service and repair fees - related
parties |
|
|
6 |
|
|
|
9 |
|
|
Costs related to patient fee revenue |
|
|
2,028 |
|
|
|
- |
|
|
Costs related to management and other fees |
|
|
5,190 |
|
|
|
2,235 |
|
|
Costs related to management and other fees - related
medical practices |
|
|
1,270 |
|
|
|
852 |
|
|
Research and development |
|
|
374 |
|
|
|
320 |
|
|
Selling, general and administrative |
|
|
4,352 |
|
|
|
2,352 |
|
|
Provision for bad debts |
|
|
(124 |
) |
|
|
325 |
|
|
|
Total Costs and Expenses |
|
|
14,314 |
|
|
|
7,891 |
|
Income From Operations |
|
|
3,295 |
|
|
|
1,722 |
|
Interest Expense |
|
|
(237 |
) |
|
|
(103 |
) |
Investment Income |
|
|
60 |
|
|
|
60 |
|
Other Expense |
|
|
- |
|
|
|
(4 |
) |
Income Before Provision for Income Taxes and Non
Controlling Interests |
|
|
3,118 |
|
|
|
1,675 |
|
Provision for Income Taxes |
|
|
70 |
|
|
|
55 |
|
Net Income |
|
|
3,048 |
|
|
|
1,620 |
|
Net Income - Non Controlling Interests |
|
|
(905 |
) |
|
|
(271 |
) |
Net Income - Controlling Interests |
|
$ |
2,143 |
|
|
$ |
1,349 |
|
Net Income Available to Common Stockholders |
|
$ |
2,003 |
|
|
$ |
1,259 |
|
Net Income Available to Class A Non-Voting Preferred
Stockholders |
|
$ |
104 |
|
|
$ |
67 |
|
Net Income Available to Class C Common
Stockholders |
|
$ |
36 |
|
|
$ |
23 |
|
Basic Net Income Per Common Share Available to Common
Stockholders |
|
$ |
0.33 |
|
|
$ |
0.21 |
|
Diluted Net Income Per Common Share Available to Common
Stockholders |
|
$ |
0.33 |
|
|
$ |
0.21 |
|
Basic and Diluted Income Per Share-Common C |
|
$ |
0.09 |
|
|
$ |
0.06 |
|
Weighted Average Basis Shares Outstanding-Common
Stockholders |
|
|
6,006 |
|
|
|
5,926 |
|
Weighted Average Diluted Shares Outstanding |
|
|
6,133 |
|
|
|
6,054 |
|
Weighted Average Basic Shares Outstanding - Class
C |
|
|
383 |
|
|
|
383 |
|
Weighted Average Diluted Shares Outstanding - Class C
Common |
|
|
383 |
|
|
|
383 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FONAR CORPORATION AND SUBSIDIARIES |
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
|
(AMOUNTS AND SHARES IN THOUSANDS, EXCEPT PER SHARE
AMOUNTS) |
|
(UNAUDITED) |
|
|
|
|
|
FOR THE SIX MONTHS ENDED DECEMBER 31, |
|
|
|
2013 |
|
|
2012 |
|
REVENUES |
|
|
|
|
|
|
|
|
|
Product sales - net |
|
$ |
783 |
|
|
$ |
2,121 |
|
|
Service and repair fees - net |
|
|
5,060 |
|
|
|
5,474 |
|
|
Service and repair fees - related parties - net |
|
|
55 |
|
|
|
55 |
|
|
Patient fee revenue, net of contractual allowances and
discounts |
|
|
11,721 |
|
|
|
- |
|
|
Provision for bad debts for patient fee |
|
|
(4,262 |
) |
|
|
- |
|
|
Management and other fees - net |
|
|
16,417 |
|
|
|
7,544 |
|
|
Management and other fees - related medical practices -
net |
|
|
4,666 |
|
|
|
3,930 |
|
|
|
Total Revenues - Net |
|
|
34,440 |
|
|
|
19,124 |
|
|
|
|
|
|
|
|
|
|
|
|
COSTS AND EXPENSES |
|
|
|
|
|
|
|
|
|
Costs related to product sales |
|
|
678 |
|
|
|
1,959 |
|
|
Costs related to service and repair fees |
|
|
1,131 |
|
|
|
1,760 |
|
|
Costs related to service and repair fees - related
parties |
|
|
12 |
|
|
|
18 |
|
|
Costs related to patient fee revenue |
|
|
3,877 |
|
|
|
- |
|
|
Costs related to management and other fees |
|
|
10,264 |
|
|
|
4,406 |
|
|
Costs related to management and other fees - related
medical practices |
|
|
2,490 |
|
|
|
1,669 |
|
|
Research and development |
|
|
769 |
|
|
|
650 |
|
|
Selling, general and administrative |
|
|
8,089 |
|
|
|
4,564 |
|
|
Provision for bad debts |
|
|
(218 |
) |
|
|
500 |
|
|
|
Total Costs and Expenses |
|
|
27,092 |
|
|
|
15,526 |
|
Income From Operations |
|
|
7,348 |
|
|
|
3,598 |
|
Interest Expense |
|
|
(480 |
) |
|
|
(179 |
) |
Investment Income |
|
|
121 |
|
|
|
120 |
|
Other Expense |
|
|
(151 |
) |
|
|
(13 |
) |
Income Before Provision for Income Taxes and Non
Controlling Interests |
|
|
6,838 |
|
|
|
3,526 |
|
Provision for Income Taxes |
|
|
170 |
|
|
|
127 |
|
Net Income |
|
|
6,668 |
|
|
|
3,399 |
|
Net Income - Non Controlling Interests |
|
|
(2,088 |
) |
|
|
(598 |
) |
Net Income - Controlling Interests |
|
$ |
4,580 |
|
|
$ |
2,801 |
|
Net Income Available to Common Stockholders |
|
$ |
4,280 |
|
|
$ |
2,616 |
|
Net Income Available to Class A Non-voting Preferred
Stockholders |
|
$ |
223 |
|
|
$ |
138 |
|
Net Income Available to Class C Common
Stockholders |
|
$ |
77 |
|
|
$ |
47 |
|
Basic Net Income Per Common Share Available to Common
Stockholders |
|
$ |
0.71 |
|
|
$ |
0.44 |
|
Diluted Net Income Per Common Share Available to Common
Stockholders |
|
$ |
0.70 |
|
|
$ |
0.43 |
|
Basic and Diluted Income Per Share-Common C |
|
$ |
0.20 |
|
|
$ |
0.12 |
|
Weighted Average Basic Shares Outstanding |
|
|
5,992 |
|
|
|
5,914 |
|
Weighted Average Diluted Shares Outstanding |
|
|
6,120 |
|
|
|
6,041 |
|
Weighted Average Basic Shares Outstanding - Class C
Common |
|
|
383 |
|
|
|
383 |
|
Weighted Average Diluted Shares Outstanding - Class C
Common |
|
|
383 |
|
|
|
383 |
|
Contact: Daniel Culver Director of Communications E-mail: Email
Contact www.fonar.com
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