FONAR Announces Fiscal 2016 1st Quarter Financial Results
MELVILLE,
NEW YORK, November 9, 2015 - FONAR Corporation (NASDAQ-FONR), The Inventor of MR Scanning™, reported its first quarter fiscal 2016 results for the quarter ended September 30, 2015. FONAR is the first Company in the MRI industry to manufacture an MRI (Magnetic Resonance Imaging) scanner. The Company’s two industry segments are: development, manufacturing and servicing of the UPRIGHT® Multi-Position™ MRI, and management of Stand-Up® MRI (UPRIGHT® MRI) centers. FONAR’s substantial list of patents include recent patents for its technology enabling full
weight-bearing MRI imaging on all the gravity sensitive regions of the human anatomy, especially the brain, extremities and spine.
These include FONAR’s newest works-in-progress technology for visualizing and quantifying the flow of cerebrospinal fluid (CSF) which circulates throughout the brain and vertebral column at the rate of 32 quarts per day. Imaging and quantifying the dynamics of this vital life-sustaining physiology of the body’s neurologic system has been made possible by FONAR’s introduction of the MRI and its latest works-in-progress for quantifying CSF in all the normal positions of the body, particularly in its upright flow against gravity.
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 full weight-bearing UPRIGHT® position.
Financial Highlights
Total Revenues - Net for the quarter ended September 30, 2015 were $17.6 million as compared to $18.0 million for the corresponding quarter ended September 30, 2014.
Net Income for the quarter ended September 30, 2015 increased 6% to $3.5 million as compared to $3.3 million for the corresponding quarter ended September 30, 2014.
Income from Operations for the quarter ended September 30, 2015 increased 5% to $3.6 million as compared to $3.4 million for the corresponding quarter ended September 30, 2014.
Basic Net Income per Common Share Available to Common Shareholders for the quarter ended September 30, 2015 increased 13% to $0.44 as compared to $0.39 for the corresponding quarter ended September 30, 2014.
Diluted Net Income per Common Share Available to Common Shareholders for the quarter ended September 30, 2015 increased 13% to $0.43 as compared to $0.38 for the corresponding quarter ended September 30, 2014.
Total Assets at September 30, 2015 were $79.0 million, as compared to $76.5 million at June 30, 2015.
Total Current Assets at September 30, 2015 were $46.9 million, as compared to $43.6 million at June 30, 2015.
Total Cash and Cash Equivalents at September 30, 2015 increased 16% to $11.0 million, as compared to $9.4 million at June 30, 2015.
Total Liabilities at September 30, 2015 were $26.0 million, as compared to $25.7 million at June 30, 2015.
Total Current Liabilities at September 30, 2015 were $19.7 million, as compared to $18.8 million at June 30, 2015.
Significant Events
Earlier this year, a medical monograph was published by S. Karger, AG based in Basel, Switzerland (see www.karger.com/Book/Home/261956). It is titled “The Craniocervical Syndrome and MRI,” and highlights the FONAR UPRIGHT® Multi-Position MRI. It also highlights the recently discovered syndrome that shows how neck injury can interfere with cerebrospinal fluid (CSF) flow in the brain, causing a variety of brain diseases. For more details and a press release visit www.fonar.com/news/050515.htm .
Management Discussion
Raymond V. Damadian, president and chairman of FONAR Corporation said, “The Company continues to focus on ways to increase revenue and net income. We are still concerned about potential cuts in MRI reimbursement rates, however we will continue to explore all opportunities to expand our capacity. Various new applications of FONAR’s UPRIGHT® MRI technology can deliver additional positive results to patients, referring doctors and our shareholders.”
“In any case,” said Dr. Damadian, “the success for our managed Stand-Up MRI centers is because physicians have come to understand that they will obtain ‘BETTER PATIENT OUTCOMES’ from the treatment of patients if they obtain their images, (particularly the spine) with their patients in their usual upright fully weight-loaded symptom generating positions. They understand that they run the risk of failure to visualize structural abnormalities in the spines of their patients that could result in poor outcomes from their treatment. Obtaining
their patients’ images in the fully weight-loaded multiple positions provided by FONAR’s UPRIGHT® Multi-Position™ MRI can significantly reduce the prospect of poor outcomes.”
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. FONAR’s stellar product is the FONAR 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.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts and shares in thousands, except per share amounts)
(UNAUDITED)
Assets
|
| |
September 30,
2015
|
June 30,
2015 *
|
Current Assets: |
|
|
Cash and cash equivalents
|
$ 10,973 |
$ 9,449 |
Accounts receivable – net
|
4,591 |
3,791 |
Accounts receivable - related party
|
90 |
- |
|
|
9,442 |
9,082 |
Management and other fees receivable - net
|
14,484 |
14,058 |
Management and other fees receivable – related medical practices – net
|
3,600 |
3,507 |
Costs and estimated earnings in excess of billings on uncompleted contracts
|
682 |
682 |
|
|
2,296 |
2,192 |
Prepaid expenses and other current assets
|
775 |
860 |
Total Current Assets
|
46,933
|
43,621
|
Deferred income tax asset
|
8,423 |
8,423 |
Property and equipment – net
|
12,439 |
12,901 |
|
|
1,767 |
1,767 |
Other intangible assets – net
|
8,647 |
8,950 |
|
|
818 |
830 |
| Total Assets |
$ 79,027
================ |
$ 76,492
================ |
*Condensed from audited financial statements.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts and shares in thousands, except per share amounts)
(UNAUDITED)
Liabilities and Stockholders’ Equity
|
| |
September 30,
2015
|
June 30,
2015 * |
Current Liabilities:
|
|
|
Current portion of long-term debt and capital leases
|
$ 2,478 |
$ 2,490 |
Accounts payable
|
1,595 |
1,783 |
Other current liabilities
|
8,764 |
8,253 |
Unearned revenue on service contracts
|
4,714 |
4,187 |
Unearned revenue on service contracts – related party
|
83 |
- |
Customer deposits
|
1,939 |
1,938 |
Billings in excess of costs and estimated earnings on uncompleted contracts
|
142 |
142 |
Total Current Liabilities
|
19,715 |
18,793 |
|
|
|
Long-Term Liabilities:
|
|
|
Deferred income tax liability
|
510 |
510 |
Due to related medical practices
|
233 |
237 |
Long-term debt and capital leases, less current portion
|
5,088 |
5,699 |
Other Liabilities |
485 |
469 |
Total Long-Term Liabilities
|
6,316 |
6,915 |
Total Liabilities
|
26,031 |
25,708 |
*Condensed from audited financial statements.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts and shares in thousands, except per share amounts)
(Unaudited)
Liabilities and Stockholders’ Equity (Continued)
|
STOCKHOLDERS' EQUITY:
|
September 30,
2015 |
June 30,
2015 *
|
Class A non-voting preferred stock $.0001 par value; 453 shares authorized at September 30, 2015 and June 30, 2015, 313 issued and outstanding at September 30, 2015 and June 30, 2015
|
$ — |
$ — |
Preferred stock $.001 par value; 567 shares authorized at September 30, 2015 and June 30, 2015, issued and outstanding – none
|
— |
— |
Common Stock $.0001 par value; 8,500 shares authorized at September 30, 2015 and June 30, 2015, 6,062 issued at September 30, 2015 and June 30, 2015; 6,051 outstanding at September 30, 2015 and June 30, 2015
|
1 |
1 |
Class B Common Stock (10 votes per share) $.0001 par value; 227 shares authorized at September 30, 2015 and June 30, 2015; .146 issued and outstanding at September 30, 2015 and June 30, 2015
|
— |
— |
Class C Common Stock (25 votes per share) $.0001 par value; 567 shares authorized at September 30, 2015 and June 30, 2015, 383 issued and outstanding at September 30, 2015 and June 30, 2015
|
— |
— |
Paid-in capital in excess of par value
|
175,448 |
175,448 |
Accumulated deficit
|
(133,487) |
(136,349) |
Notes receivable from employee stockholders
|
(30) |
(32) |
Treasury stock, at cost - 12 shares of common stock at September 30, 2015 and June 30, 2015
|
(675)
|
(675)
|
Total Fonar Corporation Stockholder Equity |
41,257 |
38,393 |
Noncontrolling interests |
11,739 |
12,391 |
Total Stockholders' Equity
|
52,996 |
50,784
|
Total Liabilities and Stockholders' Equity
|
$ 79,027
================
|
$ 76,492
================ |
* Condensed from audited financial statements
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts and shares in thousands, except per share amounts)
(UNAUDITED)
|
| |
THREE MONTHS ENDED
SEPTEMBER 30,
|
| REVENUES |
2015
|
2014
|
|
|
$ 18 |
$ 1,271 |
Service and repair fees - net
|
2,284 |
2,491 |
Service and repair fees - related parties - net
|
28 |
28 |
Patient fee revenue, net of contractual allowances and discounts
|
8,114 |
6,787 |
Provision for bad debts for patient fee |
(3,507) |
(3,146) |
Management and other fees - net
|
8,829 |
8,738 |
Management and other fees–related medical practices – net
|
1,845 |
1,816
|
|
|
17,611 |
17,985 |
COSTS AND EXPENSES
|
|
|
Costs related to product sales |
112 |
1,085 |
Costs related to service and repair fees
|
543 |
507 |
Costs related to service and repair fees - related parties
|
7 |
6 |
Costs related to patient fee revenue
|
2,228 |
1,899 |
Costs related to management and other fees
|
5,419 |
5,590 |
Costs related to management and other fees - related medical practices
|
1,058 |
979 |
|
|
436 |
397 |
Selling, general and administrative
|
3,775 |
3,578 |
|
|
418 |
506 |
|
|
13,996
|
14,547
|
Income From Operations
|
3,615 |
3,438 |
Interest expense |
(150) |
(204) |
Investment income |
50 |
62 |
Income Before Provision for Income Taxes and noncontrolling Interests |
3,515 |
3,296 |
Provision for Income Taxes |
50 |
40 |
Net Income |
3,465 |
3,256 |
Net Income - Noncontrolling Interests |
(603) |
(721) |
Net Income - Controlling Interests
|
$ 2,862
================ |
$ 2,535
================ |
Net Income Available to Common Stockholders |
$ 2,676
================ |
$ 2,370
================ |
Net Income Available to Class A Non-Voting Preferred Stockholders
|
$ 139
================ |
$ 123
================ |
Net Income Available to Class C Common Stockholders |
$ 47
================ |
$ 42
================ |
Basic Net Income Per Common Share Available to Common Stockholders
|
$ 0.44
================ |
$ 0.39
================ |
Diluted Net Income Per Common Share Available to Common Stockholders
|
$ 0.43
================ |
$ 0.38
================ |
Basic and Diluted Income Per Share - Class C Common |
$ 0.12
================ |
$ 0.11
================ |
Weighted Average Basic Shares Outstanding – Common Stockholders |
6,050
================ |
6,050
================ |
Weighted Average Diluted Shares Outstanding - Common Stockholders |
6,178
================ |
6,178
================ |
Weighted Average Basic Shares Outstanding – Class C Common |
383
================ |
383
================ |
Weighted Average Diluted Shares Outstanding – Class C Common |
383
================ |
383
================ |
FONAR™ Corporation
110 Marcus Drive
Melville, N.Y. 11747
Tel. 631-694-2929
Fax. 631-390-9540
Email sales@FONAR.com
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