MELVILLE, NY--(Marketwire - Feb 14, 2012) - FONAR Corporation (
Results from the Second Quarter Fiscal 2012 Financial Statement:
The basic income per common share increased 56% to $0.50 for the six months ended December 31, 2011 as compared to $0.32 for the same period one year earlier. For the quarter ended December 31, 2011 and 2010, the basic net income per common share was $0.25.
In addition, the diluted income per common share increased 58% to $0.49 for the six months ended December 31, 2011 as compared to $0.31 for the same period one year earlier. For the quarter ended December 31, 2011 and 2010, the diluted net income per common share was $0.24.
Net income for the six month period ended December 31, 2011 rose 105% to $3.6 million as compared to $1.7 million for the six month period ended December 31, 2010. For the quarter ended December 31, 2011, net income climbed 33% to $1.8 million as compared to $1.4 million for the quarter ended December 31, 2010.
Income from operations for the six month period ended December 31, 2011 rose 95% to $3.7 million as compared to $1.9 million for the six month period ended December 31, 2010. For the quarter ended December 31, 2011, income from operations climbed 31% to $1.9 million as compared to $1.4 million for the quarter ended December 31, 2010.
Total revenues for the six month period ended December 31, 2011 rose 13% to $18.9 million as compared to $16.7 million for the six month period ended December 31, 2010. For the quarter ended December 31, 2011, total revenue climbed 16% to $9.3 million as compared to $8.0 million for the quarter ended December 31, 2010.
Total operating costs and expenses increased 3% to $15.3 million for the six months ended December 31, 2011 from $14.8 million for the six months ended December 31, 2010. For the quarter ended December 31, 2011, total operating costs and expenses increased 13% to $7.4 million as compared to $6.6 million for the quarter ended December 31, 2011.
Revenues from product sales were $1.6 million for the fiscal quarter ended December 31, 2011 as compared to $1.8 million for the corresponding quarter ended December 31, 2010. Revenues from service and repair fees were $2.8 million for the fiscal quarter ended December 31, 2011 as compared to $2.7 million for the fiscal quarter ended December 31, 2010.
Revenues from the management and other fees segment (management of the FONAR UPRIGHT® Multi-Position™ MRI diagnostic imaging centers segment) increased 39% to $4.9 million for the fiscal quarter ended December 31, 2011, from $3.5 million for the fiscal quarter ended December 31, 2010.
As of December 31, 2011 total current assets were $25.1 million and total current liabilities were $21.9 million. Total assets were $33.5 million and total liabilities were $24.3 million. Total long-term liabilities were $2.4 million. Total stockholders' equity was $9.2 million. Total cash and cash equivalents and marketable securities were $9.9 million.
Significant Highlights during the October - December Quarter:
On October 5, 2011, the Company reported a diagnostic breakthrough in the understanding of the genesis of multiple sclerosis (MS) based on observations made possible by the company's unique FONAR UPRIGHT® Multi-Position™ MRI. The press release indicated that the cause of multiple sclerosis may be biomechanical and related to earlier trauma to the neck, which can result in the obstruction of the flow of cerebrospinal fluid (CSF), which is produced and stored in the central anatomic structures of the brain known as the ventricles. Since the ventricles produce a large volume of CSF each day (500 cc), an obstruction can result in a build-up of pressure within the ventricles, resulting in leakage of the CSF into the surrounding brain tissue. This leakage could be responsible for generating the brain lesions of multiple sclerosis.
The research was published in the journal Physiological Chemistry and Physics and Medical NMR (Sept. 20, 2011, 41: 1-17), titled "The Possible Role of Cranio-Cervical Trauma and Abnormal CSF Hydrodynamics in the Genesis of Multiple Sclerosis." It was co-authored by FONAR MRI researchers Raymond V. Damadian, M.D., president and chairman of FONAR and FONAR scientist David Chu, PhD. The complete study can be viewed at www.fonar.com/pdf/PCP41_damadian.pdf.
Dr. Damadian said, "We used the UPRIGHT® Multi-Position™ MRI to view the flow of cerebrospinal fluid in and out of the brain with the patients scanned Upright and scanned lying down. The UPRIGHT® MRI also revealed that these obstructions were the result of structural deformities of the cervical spine, induced by trauma earlier in life. The findings are based on viewing the real-time flow of cerebrospinal fluid in a series of eight randomly chosen patients with multiple sclerosis. These invaluable dual observations have only been possible since the invention by FONAR of an MRI capable of imaging the patient Upright." For more information visit: www.fonar.com.
On October 4, 2011, Dr. Damadian announced the study at a Radiology Department Grand Rounds at the University of California San Diego Medical Center. William G. Bradley, Jr., M.D., Ph.D., F.A.C.R., Chairman of the Department of Radiology, and a Professor of Radiology at UCSD School of Medicine, introduced Dr. Damadian to his colleagues at grand rounds. Dr. Bradley said, "Dr. Damadian has shown that 8 patients with MS had degenerative changes in their cervical spines which impinged on the spinal canal and limited the pulsatile, to-and-fro flow of cervical CSF over the cardiac cycle, as demonstrated on UPRIGHT® MRI. His hypothesis that increased resistance to outflow of CSF is linked to the etiology of MS has some similarities to Dr. P. Zamboni's hypothesis that MS is due to the impeded outflow of venous blood from the brain due to dural sinus stenoses. In both theories, increased resistance to outflow of either CSF or venous blood would be expected to modify the intracranial pressure wave over the cardiac cycle. While both theories need to be further tested with larger controlled studies, it is intriguing that they seem to invoke similar pathologic changes. Whether these changes are etiologic in all cases of MS remains to be tested."
On November 2, 2011, FONAR reported on a 41-year-old female patient with MS that had been one of the eight patients in the original study. The FONAR UPRIGHT® MRI had found cervical malrotations at the cranio-cervical junction and alterations of CSF flow dynamics which gave rise to CSF fluid leakages into surrounding brain tissue. The CSF leakages visualized were directly connected to the MS lesions visualized on the UPRIGHT® MRI. Dr. Damadian stated, "These new observations have uncovered biomechanical barriers that appear to lead to multiple sclerosis. It is significant that these barriers may be therapeutically addressable."
The MS patient was treated by Dr. Scott Rosa, with a proprietary protocol using an Atlas Orthogonal (AO) instrument and the FONAR UPRIGHT® Multi-Position™ MRI. The patient has experienced a significant reduction in symptoms which correlate directly to 28.6% reduction of her CSF pressure on post MRI evaluation. At this time the patient continues to be free of MS symptoms as well as vertigo and vomiting on recumbency. The patient's care continues being administered by Dr. Rosa.
On November 30, 2011, the Company reported a sale of its UPRIGHT® Multi-Position™ MRI to a radiology practice in the western USA. This becomes the 29th state to have a customer purchase the FONAR UPRIGHT® MRI. The FONAR UPRIGHT® Multi-Position™ MRI has also been sold to Puerto Rico and has been installed in eleven other nations around the world.
The board certified radiologist purchasing the FONAR UPRIGHT® Multi-Position™ MRI for his practice said he was buying the scanner in order to meet the expressed needs of his sending physicians, principally neurosurgeons and orthopedic surgeons. They are eager, he said, to achieve the best possible surgical outcomes for their spine surgery patients. Failure to see the full picture could result in the administration of a wrong or insufficient surgical procedure. They consider imaging the spine fully loaded with its normal weight, and in all the upright positions that the spine normally occupies, fundamental to a good surgical outcome for the patient.
FONAR (
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.
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| FONAR CORPORATION AND SUBSIDIARIES | ||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
| (000's OMITTED) | ||||||
| ASSETS | ||||||
| December 31, | June 30, | |||||
| 2011 | 2011 | |||||
| Current Assets: | (UNAUDITED) | |||||
| Cash and cash equivalents | $ | 9,911 | $ | 9,251 | ||
| Marketable securities | 30 | 33 | ||||
| Accounts receivable - net | 4,823 | 5,264 | ||||
| Accounts receivable - related party | 60 | - | ||||
| Management and other fees receivable - net | 3,635 | 3,309 | ||||
| Management and other fees receivable - related medical practices - net | 1,307 | 1,669 | ||||
| Costs and estimated earnings in excess of billings on uncompleted contracts | 1,152 | 169 | ||||
| Inventories | 3,806 | 2,400 | ||||
| Current portion of notes receivable - net | 115 | 114 | ||||
| Prepaid expenses and other current assets | 270 | 352 | ||||
| Total Current Assets | 25,109 | 22,561 | ||||
| Property and equipment - net | 3,374 | 3,769 | ||||
| Notes receivable | 315 | 359 | ||||
| Other intangible assets - net | 4,120 | 4,318 | ||||
| Other assets | 535 | 574 | ||||
| Total Assets | $ | 33,453 | $ | 31,581 | ||
| FONAR CORPORATION AND SUBSIDIARIES | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (000's OMITTED) | ||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| December 31, | June 30, | |||||||
| 2011 | 2011 | |||||||
| (UNAUDITED) | ||||||||
| Current Liabilities: | ||||||||
| Current portion of long-term debt and capital Leases | $ | 1,636 | $ | 2,026 | ||||
| Accounts payable | 1,959 | 2,187 | ||||||
| Other current liabilities | 8,956 | 8,236 | ||||||
| Unearned revenue on service contracts | 5,275 | 5,762 | ||||||
| Unearned revenue on service contracts - related Parties | 55 |
- |
||||||
| Customer advances | 3,303 | 4,846 | ||||||
| Billings in excess of costs and estimated earnings on uncompleted contracts | 736 | 4 | ||||||
| Income tax payable | - | 75 | ||||||
| Total Current Liabilities | 21,920 | 23,136 | ||||||
| Long-Term Liabilities: | ||||||||
| Accounts payable | 141 | 102 | ||||||
| Due to related medical practices | 229 | 228 | ||||||
| Long-term debt and capital leases, less current Portion | 1,490 | 1,746 | ||||||
| Other liabilities | 494 | 502 | ||||||
| Total Long-Term Liabilities | 2,354 | 2,578 | ||||||
| Total Liabilities | 24,274 | 25,714 | ||||||
| FONAR CORPORATION AND SUBSIDIARIES | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (000's OMITTED) | ||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (Continued) | ||||||||
| December 31, | June 30, | |||||||
| 2011 | 2011 | |||||||
| (UNAUDITED) | ||||||||
| STOCKHOLDERS' EQUITY: | ||||||||
| Class A non-voting preferred stock $.0001 par value; 453,000 shares authorized at December 31, 2011 and June 30, 2011, 313,451 issued and outstanding at December 31, 2011 and June 30, 2011 | - | - | ||||||
| Preferred stock $.001 par value; 567,000 shares authorized at December 31, 2011 and June 30, 2011, issued and outstanding - none | - | - | ||||||
| Common Stock $.0001 par value; 8,500,000 shares authorized at December 31, 2011 and June 30, 2011, 5,774,371 and 5,636,571 issued at December 31, 2011 and June 30, 2011, respectively; 5,762,728 and 5,624,928 outstanding at December 31, 2011 and June 30, 2011, respectively | 1 | 1 |
||||||
| Class B Common Stock (10 votes per share) $ .0001 par value; 227,000 shares authorized at December 31, 2011 and June 30, 2011, 158 issued and outstanding at December 31, 2011 and June 30, 2011 | - | - | ||||||
| Class C Common Stock (25 votes per share) $.0001 par value; 567,000 shares authorized at December 31, 2011 and June 30, 2011, 382,513 issued and outstanding at December 31, 2011 and June 30, 2011 | - | - | ||||||
| Paid-in capital in excess of par value | 173,729 | 173,476 | ||||||
| Accumulated other comprehensive loss | (20 | ) | (16 | ) | ||||
| Accumulated deficit | (171,061 | ) | (174,110 | ) | ||||
| Notes receivable from employee stockholders | (74 | ) | (115 | ) | ||||
| Treasury stock, at cost - 11,643 shares of common stock at December 31, 2011 and June 30, 2011 | (675 | ) | (675 | ) | ||||
| Non controlling interests | 7,279 | 7,306 | ||||||
| Total Stockholders' Equity | 9,179 | 5,867 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 33,453 | $ | 31,581 | ||||
| FONAR CORPORATION AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | ||||||||||
| (000's OMITTED, except per share data) | ||||||||||
| FOR THE THREE MONTHS ENDED | ||||||||||
| DECEMBER 31, | ||||||||||
| REVENUES | 2011 | 2010 | ||||||||
| Product sales - net | $ | 1,615 | $ | 1,789 | ||||||
| Service and repair fees - net | 2,807 | 2,653 | ||||||||
| Service and repair fees - related parties - net | 27 | 55 | ||||||||
| Management and other fees - net | 3,308 | 2,380 | ||||||||
| Management and other fees - related medical practices - net | 1,571 | 1,142 | ||||||||
| Total Revenues - Net | 9,328 | 8,019 | ||||||||
| COSTS AND EXPENSES | ||||||||||
| Costs related to product sales | 1,171 | 1,368 | ||||||||
| Costs related to service and repair fees | 868 | 700 | ||||||||
| Costs related to service and repair fees - related parties | 9 | 15 | ||||||||
| Costs related to management and other fees | 1,887 | 1,707 | ||||||||
| Costs related to management and other fees - related medical practices | 901 | 633 | ||||||||
| Research and development | 293 | 153 | ||||||||
| Selling, general and administrative | 1,995 | 1,745 | ||||||||
| Provision for bad debts | 310 | 255 | ||||||||
| Total Costs and Expenses | 7,434 | 6,576 | ||||||||
| Income From Operations | 1,894 | 1,443 | ||||||||
| Interest Expense | (124 | ) | (137 | ) | ||||||
| Investment Income | 64 | 58 | ||||||||
| Other Expense | (1 | ) | (1 | ) | ||||||
| Provision for Income Taxes | (21 | ) | - | |||||||
| Net Income | 1,812 | 1,363 | ||||||||
| Net Income - Non Controlling Interests | 276 | - | ||||||||
| Net Income - Controlling Interests | $ | 1,536 | $ | 1,363 | ||||||
| Net Income Available to Common Stockholders | $ | 1,432 | $ | 1,262 | ||||||
| Net Income Available to Class A Non-Voting Preferred Stockholders | $ | 78 | $ | 75 | ||||||
| Net Income Available to Class C Common Stockholders | $ | 26 | $ | 26 | ||||||
| Basic Net Income Per Common Share | $ | 0.25 | $ | 0.25 | ||||||
| Diluted Net Income Per Common Share | $ | 0.24 | $ | 0.24 | ||||||
| Basic and Diluted Income Per Share-Common C | $ | 0.07 | $ | 0.07 | ||||||
| Weighted Average Basic Shares Outstanding | 5,728,528 | 5,149,499 | ||||||||
| Weighted Average Diluted Shares Outstanding | 5,856,032 | 5,277,003 | ||||||||
| FONAR CORPORATION AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | ||||||||||
| (000's OMITTED, except per share data) | ||||||||||
| FOR THE SIX MONTHS ENDED | ||||||||||
| DECEMBER 31, | ||||||||||
| 2011 | 2010 | |||||||||
| REVENUES | ||||||||||
| Product sales - net | $ | 3,391 | $ | 4,448 | ||||||
| Service and repair fees - net | 5,712 | 5,342 | ||||||||
| Service and repair fees - related parties - net | 55 | 110 | ||||||||
| Management and other fees - net | 6,637 | 4,469 | ||||||||
| Management and other fees - related medical practices - net | 3,141 |
2,335 |
||||||||
| Total Revenues - Net | 18,936 | 16,704 | ||||||||
| COSTS AND EXPENSES | ||||||||||
| Costs related to product sales | 2,646 | 3,873 | ||||||||
| Costs related to service and repair fees | 1,682 | 1,366 | ||||||||
| Costs related to service and repair fees - related parties | 16 |
28 | ||||||||
| Costs related to management and other fees | 4,072 | 3,021 | ||||||||
| Costs related to management and other fees - related medical practices | 1,720 |
1,372 |
||||||||
| Research and development | 622 | 607 | ||||||||
| Selling, general and administrative | 4,037 | 4,128 | ||||||||
| Provision for bad debts | 485 | 431 | ||||||||
| Total Costs and Expenses | 15,280 | 14,826 | ||||||||
| Income From Operations | 3,656 | 1,878 | ||||||||
| Interest Expense | (231 | ) | (231 | ) | ||||||
| Interest Expense - Related Party | - | (4 | ) | |||||||
| Investment Income | 126 | 96 | ||||||||
| Interest Income - Related Party | - | 1 | ||||||||
| Other Income | 55 | 8 | ||||||||
| Provision for Income Taxes | (21 | ) | - | |||||||
| Net Income | 3,585 | 1,748 | ||||||||
| Net Income - Non Controlling Interests | 535 | - | ||||||||
| Net Income - Controlling Interests | $ | 3,050 | $ | 1,748 | ||||||
| Net Income Available to Common Stockholders | $ | 2,842 | $ | 1,618 | ||||||
| Net Income Available to Class A Non-voting Preferred Stockholders | $ | 155 | $ | 97 | ||||||
| Net Income Available to Class C Common Stockholders | $ | 53 | $ | 33 | ||||||
| Basic Net Income Per Common Share | $ | 0.50 | $ | 0.32 | ||||||
| Diluted Net Income Per Common Share | $ | 0.49 | $ | 0.31 | ||||||
| Basic and Diluted Income Per Share-Common C | $ | 0.14 | $ | 0.09 | ||||||
| Weighted Average Basic Shares Outstanding | 5,698,645 | 5,080,872 | ||||||||
| Weighted Average Diluted Shares Outstanding | 5,826,149 | 5,208,376 | ||||||||
Contact Information:
Contact:
Daniel Culver
Director of Communications
FONAR Corporation
Tel: 631-694-2929
Fax: 631-390-1709