MELVILLE, NY--(Marketwire - February 22, 2010) - FONAR Corporation (NASDAQ: FONR), today announced its financial results for the second quarter of fiscal 2010, which ended December 31, 2009.
Total revenues for the second quarter of fiscal 2010 ended December 31, 2009, were $8.2 million as compared to $11.3 million for the same period last year which ended December 31, 2008. Total revenues for the six months ended December 31, 2009 were $15.7 million as compared to $18.1 million for the same period last year.
During the second fiscal 2010 quarter ended December 31, 2009, the net loss was $1.3 million as compared to a profit of $800,000 during the corresponding quarter ended December 31, 2008. The net loss for the six months period ended December 31, 2009 was $3.0 million as compared to a net income of $300,000 during the same period one year earlier. The loss per common share (basic and diluted) for the second fiscal quarter of 2010 was $0.26 as compared to a profit per common share (basic and diluted) of $0.16 during the same period one year earlier.
The principal reason for the smaller net loss in the first half of fiscal 2009 as compared to the first half of fiscal 2010 was that during the first quarter of fiscal 2009, we recognized a gain of $1.4 million on the sale of a consolidated entity managing an MRI scanning facility and, $1.8 million in license fees and royalties in the first half of fiscal 2009 as compared to $0 in license fees and royalties in the first half of fiscal 2010. The license fees were paid pursuant to an agreement which has expired.
During the second fiscal 2010 quarter for the period ended December 31, 2009, product sales were $3.0 million versus $4.4 million for the same period last year. In addition, product sales for the six month period ended December 31, 2009 were $4.5 million as compared to $5.8 million for the same period last year.
Service and repair revenues for the second fiscal 2010 quarter ended December 31, 2009, were $2.7 million as compared to $2.7 million for the same period last year. Service and repair revenues for the six month period ended December 31, 2009 were $5.5 million as compared to $5.3 million during the same period during the previous year. As of December 31, 2009, there were 141 FONAR UPRIGHT® MRI units installed worldwide.
As of December 31, 2009, total cash, cash equivalents and marketable securities were approximately $1.1 million, total current assets were $17.0 million, total assets were $24.9 million, total current liabilities were $28.8 million, and total long-term liabilities were $2.0 million.
Quarter Highlights
On December 7, 2009, the company finished the installation of an UPRIGHT® Multi-Position™ MRI at the Hospital ZorgSaam Zeeuws-Vlaanderen in Terneuzen, The Netherlands. The UPRIGHT® MRI was sold by Tecserena GmbH, FONAR's European distributor since 2006. At the time of the sale, radiologists at Hospital ZorgSaam Zeeuws-Vlaanderen said they sought the advanced technology provided by the FONAR UPRIGHT® Multi-Position™ MRI to increase the diagnostic precision of the images of weight-bearing anatomy, establishing for their hospital a new standard of excellence throughout Europe for orthopedic surgical outcomes.
Camiel Raaijmakers, M.D., Terneuzen Hospital, said, "My colleague, Frank Raat, M.D. and I as radiologists became intrigued and fascinated by the FONAR UPRIGHT® MRI system during our yearly visits to the Radiological Society of North America (RSNA) exhibit in Chicago. We realized that UPRIGHT® MR imaging could be the answer for many of our questions in spinal imaging that cannot adequately be solved with our recumbent MRI system, especially patients with degenerative instability and spinal canal stenosis, whiplash patients and postoperative patients with failed back surgery. In younger patients, in need of scoliosis imaging, it is the perfect answer to reduce the radiation exposure during yearly follow-ups."
Dr. Raaijmakers continued "In our hospital in Terneuzen, The Netherlands, there is a multidisciplinary approach to pelvic floor problems. The UPRIGHT® MRI is an ideal tool for non-invasive dynamic pelvic floor imaging."
"It (The FONAR UPRIGHT® Multi-Position MRI™) is a very patient and child-friendly truly open MRI system that is easily accessible for obese and claustrophobic patients. But also, cardiovascular compromised patients can be examined in an upright position, which is an added value to the existing diagnostic modalities," explained Dr. Raaijmakers.
Hospital ZorgSaam Zeeuws-Vlaanderen in Terneuzen, The Netherlands, is a 340-bed hospital. A very significant amount of orthopedic and spine surgery is done at the hospital. It is also one of the biggest centers in The Netherlands for the treatment of obese patients and especially bariatric surgery. For details visit: http://www.fonar.com/news/012808.htm
On December 17, 2009, FONAR announced that the Center for Diagnostic Imaging (CDI) (Minneapolis, MN) purchased a third FONAR UPRIGHT® Multi-Position™ MRI. It is scheduled to be installed in early 2010 at CDI's OpenScan MRI center in Duluth, Minnesota.
"This is the first and only FONAR UPRIGHT® Multi-Position™ MRI scanner in Northern Minnesota," said Rick Long, Regional Vice President, Minnesota. "With our high-field, recumbent MRI scanner already in the market, the replacement of our existing lower field strength open-sided MRI scanner with an Open Upright MRI was critical to providing residents access to diagnostic services that could impact their quality of care. Now patients and their doctors get the dual benefit of the open comfort and higher quality images to guide diagnosis in one scanner."
Raymond Damadian, president and founder of FONAR, commented on the second fiscal quarter ended December 31, 2009. "Nationally, this calendar year has been a challenging one for everyone. FONAR has had to further reduce its overhead. In early 2010 we began a cost-cutting plan to bring our expenditures in line with revenues. With our costs reduced, we expect to be much improved going forward."
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS (000's OMITTED)
December 31, June 30,
2009 2009
(UNAUDITED)
Current Assets: ---------- ----------
Cash and cash equivalents $ 1,071 $ 1,226
Marketable securities 30 23
Accounts receivable - net 5,922 5,392
Accounts receivable - related parties - net 119 -
Medical receivables - net 224 374
Management fee receivable - net 3,112 3,274
Management fee receivable - related medical
practices - net 1,803 2,196
Costs and estimated earnings in excess of
billings on uncompleted contracts 1,257 1,476
Inventories 2,839 3,172
Current portion of advances and notes to related
medical practices 173 165
Current portion of notes receivable 85 518
Prepaid expenses and other current assets 340 472
---------- ----------
Total Current Assets 16,975 18,288
---------- ----------
Property and equipment - net 2,495 2,892
Advances and notes to related medical
practices - net - 89
Notes receivable - net 142 1,779
Other intangible assets - net 4,896 4,920
Other assets 392 391
---------- ----------
Total Assets $ 24,900 $ 28,359
========== ==========
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(000's OMITTED)
December 31, June 30,
LIABILITIES AND STOCKHOLDERS' DEFICIENCY 2009 2009
(UNAUDITED)
Current Liabilities: ---------- ----------
Current portion of long-term debt and
capital leases $ 314 $ 277
Current portion of long-term debt - related party 84 80
Accounts payable 3,456 3,519
Other current liabilities 8,558 8,460
Unearned revenue on service contracts 5,910 5,526
Unearned revenue on service contracts - related
parties 110 -
Customer advances 7,240 9,238
Billings in excess of costs and estimated
earnings on uncompleted contracts 3,114 2,026
---------- ----------
Total Current Liabilities 28,786 29,126
Long-Term Liabilities:
Accounts payable 89 184
Due to related medical practices 645 643
Long-term debt and capital leases,
less current portion 682 759
Long-term debt less current portion -
related party 117 160
Other liabilities 459 428
---------- ----------
Total Long-Term Liabilities 1,992 2,174
---------- ----------
Total Liabilities 30,778 31,300
---------- ----------
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(000's OMITTED, except share data)
December 31, June 30,
LIABILITIES AND STOCKHOLDERS' DEFICIENCY 2009 2009
(continued) (UNAUDITED)
---------- ----------
STOCKHOLDERS' DEFICIENCY:
Class A non-voting preferred stock $.0001 par value;
1,600,000 authorized, 313,451 issued and outstanding
at December 31, 2009 and June 30, 2009 - -
Preferred stock $.001 par value;
2,000,000 shares authorized, issued
and outstanding - none - -
Common Stock $.0001 par value; 30,000,000 shares
authorized at December 31, 2009 and June 30, 2009,
4,927,918 and 4,917,918 issued at December 31, 2009
and June 30, 2009, respectively; 4,916,275 and
4,906,275 outstanding at December 31, 2009
and June 30, 2009, respectively 1 1
Class B Common Stock $ .0001 par value; 800,000
shares authorized, (10 votes per share), 158 issued
and outstanding at December 31, 2009 and June 30, 2009 - -
Class C Common Stock $.0001 par value; 2,000,000 shares
authorized, (25 votes per share), 382,513 issued
and outstanding at December 31, 2009 and June 30, 2009 - -
Paid-in capital in excess of par value 172,298 172,280
Accumulated other comprehensive loss (15) (21)
Accumulated deficit (177,292) (174,259)
Notes receivable from employee stockholders (195) (267)
Treasury stock, at cost - 11,643 shares of common stock
at December 31, 2009 and June 30, 2009 (675) (675)
---------- ----------
Total Stockholders' Deficiency (5,878) (2,941)
---------- ----------
Total Liabilities and Stockholders'
Deficiency $ 24,900 $ 28,359
========== ==========
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(000's OMITTED, except per share data)
FOR THE THREE MONTHS ENDED
DECEMBER 31,
----------------------
2009 2008
REVENUES ---------- ----------
Product sales - net $ 2,961 $ 4,407
Service and repair fees - net 2,629 2,624
Service and repair fees - related parties - net 55 55
Management and other fees - net 1,738 1,735
Management and other fees - related medical
practices - net 830 714
License fees and royalties - 1,755
---------- ----------
Total Revenues - Net 8,213 11,290
---------- ----------
COSTS AND EXPENSES
Costs related to product sales 2,279 2,824
Costs related to service and repair fees 978 1,027
Costs related to service and repair
fees - related parties 20 22
Costs related to management and other fees 1,384 1,074
Costs related to management and other
fees - related medical practices 745 698
Research and development 777 928
Selling, general and administrative 3,100 3,471
Provision for bad debts 197 545
---------- ----------
Total Costs and Expenses 9,480 10,589
---------- ----------
(Loss) Income From Operations (1,267) 701
Interest Expense (90) (40)
Interest Expense - Related Party (5) -
Investment Income 66 113
Interest Income - Related Party 3 6
Other Income 1 1
---------- ----------
NET (LOSS) INCOME $ (1,292) $ 781
========== ==========
Basic Net (Loss) Income Per Common Share $ (0.26) $ 0.16
========== ==========
Diluted Net (Loss) Income Per Common Share $ (0.26) $ 0.16
========== ==========
Weighted Average Basic Shares Outstanding 4,916,275 4,904,275
========== ==========
Weighted Average Diluted Shares Outstanding 4,916,275 4,904,275
========== ==========
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(000's OMITTED, except per share data)
FOR THE SIX MONTHS ENDED
DECEMBER 31,
----------------------
2009 2008
REVENUES ---------- ----------
Product sales - net $ 4,524 $ 5,819
Service and repair fees - net 5,386 5,170
Service and repair fees - related parties - net 110 110
Management and other fees - net 3,473 3,782
Management and other fees - related medical
practices - net 1,625 1,439
License fees and royalties 585 1,755
---------- ----------
Total Revenues - Net 15,703 18,075
---------- ----------
COSTS AND EXPENSES
Costs related to product sales 3,936 4,265
Costs related to service and repair fees 1,919 2,038
Costs related to service and repair
fees - related parties 39 43
Costs related to management and other fees 2,651 2,277
Costs related to management and other
fees - related medical practices 1,505 1,354
Research and development 1,631 1,809
Selling, general and administrative 6,333 6,735
Provision for bad debts 377 700
---------- ----------
Total Costs and Expenses 18,391 19,221
---------- ----------
Loss From Operations (2,688) (1,146)
Interest Expense (169) (119)
Interest Expense - Related Party (19) -
Investment Income 153 145
Interest Income - Related Party 6 12
Other Income 34 2
Minority Interest in Income of Partnerships - (11)
Gain on Sale of Consolidated Subsidiary - 1,448
Loss on Note Receivable (350) -
---------- ----------
NET (LOSS) INCOME $ (3,033) $ 331
========== ==========
Basic Net (Loss) Income Per Common Share $ (0.62) $ 0.07
========== ==========
Diluted Net (Loss) Income Per Common Share $ (0.62) $ 0.07
========== ==========
Weighted Average Basic Shares Outstanding 4,912,108 4,904,275
========== ==========
Weighted Average Diluted Shares Outstanding 4,912,108 4,904,275
========== ==========
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.
Contact:
Daniel Culver
FONAR Corporation
Tel: 631-694-2929
Fax: 631-390-1709
http://www.fonar.com
Email Contact
