- Published: 19 May 2009
- Written by Editor
FONAR Announces Results of the Third Fiscal Quarter 2009 as Net Income Soars Past $1 Million for Nine Month Period
FONAR Corporation (FONR ), The Inventor of MR Scanning(TM), today announced its earnings for the third quarter of fiscal 2009 ending March 31, 2009. Net income for the nine month period ending March 31, 2009 was $1.1 million as compared to the nine month period one year earlier when there was a net loss of $6.7 million. For the third fiscal quarter ending March 31, 2009, the Company reported net income of $730,000 as compared to the same period one year earlier when it had a loss of $2.7 million.
Revenues increased 7.0% to $29.3 million for the nine month period ending March 31, 2009 as compared to $27.4 million for the nine month period ending March 31, 2008. For the quarter ending March 31, 2009, revenues increased 39.5% to $11.3 million as compared to $8.1 million for the quarter ending March 31, 2008.
Raymond Damadian, M.D., president and chairman of FONAR Corporation said, "We are delighted that the Company has once again become profitable. In fact we now have two straight quarters of income greater than $700,000. There are several reasons for this. While 2008 was a difficult year, we initiated an aggressive cost-cutting program. Costs and expenses have been reduced in most categories but most significantly in our selling, general and administrative expenses (S, G & A). Overall, S, G & A was reduced 36.0% from $15.5 million for the nine months ending March 31, 2008 to $10.0 million for the most current nine month period."
Dr. Damadian continued, "Another reason is a refreshed focus on 'selling scans' through our UPRIGHT® Multi-Position(TM) MRI managed sites. We currently have nine UPRIGHT® MRIs and one older FONAR QUAD(TM) MRI being managed by HMCA (Health Management Corporation of America), FONAR's wholly-owned subsidiary (www.hmca.com). There are UPRIGHT® MRI centers that scan more than 500 patients per month and we would like that to happen pervasively within the HMCA network."
"We often find that the busier UPRIGHT® Multi-Position MRI centers are in an area with many single-position, recumbent-only competitor MRIs around them," continued Dr. Damadian. "They will energize the local imaging market. When claustrophobic patients find out about the UPRIGHT® MRI, they will demand it from their referring physicians. Patients and the referring physicians seeking spine care will also seek out the best diagnostic device for their condition. Add advantages of scanning overweight patients, patients who can't lie down, weight-bearing imaging of men and women with pelvic floor dysfunction, patients with scoliosis and the ability to perform high quality routine imaging of other body parts, and you have the opportunity for a very busy MRI site."
As of March 31, 2009, there were 133 FONAR UPRIGHT® Multi-Position(TM) MRI units installed worldwide. During the third quarter of fiscal 2009 total product sales increased dramatically by 162.2 % to $6.2 million from $2.3 million over the corresponding quarter one year earlier.
During the third fiscal quarter of 2009, FONAR announced it has sold two UPRIGHT® Multi-Position(TM) MRI scanners to Doshi Diagnostic Imaging Services, P.C., which is among the country's largest privately held multi-modality imaging companies, as well as the largest radiology group in New York. Doshi Diagnostic is headquartered in Bethpage, Long Island, and operates approximately 40 centers in Florida, New Jersey, Long Island, and New York City.
Another sale of an UPRIGHT® Multi-Position(TM) MRI was to the Tripoli Medical Center, a leading state-of-the-art medical center in Libya with approximately 1450 beds, 1000 physicians, and 3000 employees. This is an especially significant sale for FONAR, because it marks the entrance of the company's UPRIGHT® imaging technology into the markets of Africa and the Middle East.
Also during the third fiscal quarter of 2009 Raymond Damadian, M.D. became the recipient of the 2009 AIMBE (American Institute for Medical and Biological Engineering) Honorary Fellow Award for his discovery of MRI. Dr. Damadian is the originator of the concept of magnetic resonance (MR) scanning of the human body (1969). The AIMBE Award was presented at the annual meeting of AIMBE, held February 11-13 in Washington, D.C.
The award says: "In 1970, Raymond Damadian, M.D., made the discovery that is the basis for magnetic resonance (MR) scanning that there is a marked difference in relaxation times between normal and abnormal tissues of the same type, as well as between different types of normal tissues. This seminal discovery, which remains the basis for the making of every MRI image ever produced, is the foundation of the MRI industry. Dr. Damadian published his discovery in his milestone 1971 paper in the journal Science (Science 171:1151, 1971) and filed the pioneer patent for the practical use of his discovery in 1972." (www.fonar.com/news/022409.htm).
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(000's OMITTED)
ASSETS March 31, June 30,
2009 2008
(UNAUDITED)
Current Assets: ---------- ----------
Cash and cash equivalents $ 1,605 $ 1,326
Marketable securities 18 1,068
Accounts receivable - net 5,206 4,689
Accounts receivable - related parties - net 619 469
Medical receivables - net 555 1,228
Management fee receivable - net 4,051 5,040
Management fee receivable - related medical
practices - net 1,480 1,372
Costs and estimated earnings in excess of
billings on uncompleted contracts 528 6
Inventories 3,793 3,256
Current portion of advances and notes to related
medical practices 193 214
Current portion of notes receivable less discount
for below market interest 509 2,508
Prepaid expenses and other current assets 409 811
---------- ----------
Total Current Assets 18,966 21,987
---------- ----------
Property and equipment - net 3,152 3,933
Advances and notes to related medical practices
- net 133 263
Notes receivable less discount for below market
interest 1,912 2,297
Other intangible assets - net 4,896 4,810
Other assets 574 1,936
---------- ----------
Total Assets $ 29,633 $ 35,226
========== ==========
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(000's OMITTED)
March 31, June 30,
LIABILITIES AND STOCKHOLDERS' DEFICIENCY 2009 2008
(UNAUDITED)
---------- ----------
Current Liabilities:
Current portion of long-term debt and capital
leases $ 141 $ 373
Accounts payable 3,720 4,020
Other current liabilities 8,045 8,316
Unearned revenue on service contracts 5,045 4,732
Unearned revenue on service contracts - related
parties 612 462
Customer advances 7,871 12,804
Customer advances - related party 854 1,472
Billings in excess of costs and estimated
earnings on uncompleted contracts 5,133 5,773
---------- ----------
Total Current Liabilities 31,421 37,952
Long-Term Liabilities:
Due to related medical practices 95 98
Long-term debt and capital leases, less current
portion 746 757
Other liabilities 319 497
---------- ----------
Total Long-Term Liabilities 1,160 1,352
---------- ----------
Total Liabilities 32,581 39,304
---------- ----------
Minority interest 64 167
---------- ----------
STOCKHOLDERS' DEFICIENCY:
Class A non-voting preferred stock $.0001 par
value; 1,600,000 authorized, 313,451 issued and
outstanding at March 31, 2009 and June 30, 2008 - -
Common Stock $.0001 par value; 30,000,000 shares
authorized at March 31, 2009 and June 30, 2008,
4,915,918 issued at March 31, 2009 and June 30,
2008 4,904,275 outstanding at March 31, 2009 and
June 30, 2008 1 1
Class B Common Stock $ .0001 par value; 800,000
shares authorized, (10 votes per share), 158 issued
and outstanding at March 31, 2009 and June 30, 2008 - -
Class C Common Stock $.0001 par value; 2,000,000
shares authorized, (25 votes per share), 382,513
issued and outstanding at March 31, 2009 and June
30, 2008 - -
Paid-in capital in excess of par value 172,276 172,276
Accumulated other comprehensive loss (25) (73)
Accumulated deficit (174,320) (175,380)
Notes receivable from employee stockholders (269) (394)
Treasury stock, at cost - 11,643 shares of common
stock at March 31, 2009 and June 30, 2008 (675) (675)
---------- ----------
Total Stockholders' Deficiency (3,012) (4,245)
---------- ----------
Total Liabilities and Stockholders' Deficiency $ 29,633 $ 35,226
========== ==========
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(000's OMITTED, except per share data)
FOR THE THREE MONTHS ENDED
MARCH 31,
----------------------
2009 2008
REVENUES ---------- ----------
Product sales - net $ 6,156 $ 2,348
Service and repair fees - net 2,291 2,515
Service and repair fees - related parties - net 331 270
Management and other fees - net 1,736 2,110
Management and other fees - related medical
practices - net 742 828
---------- ----------
Total Revenues - Net 11,256 8,071
---------- ----------
COSTS AND EXPENSES
Costs related to product sales 3,325 2,237
Costs related to service and repair fees 865 1,148
Costs related to service and repair
fees - related parties 125 123
Costs related to management and other fees 1,039 1,342
Costs related to management and other
fees - related medical practices 686 751
Research and development 872 1,189
Selling, general and administrative 3,219 4,311
Provision (Credit) for bad debts 363 (309)
---------- ----------
Total Costs and Expenses 10,494 10,792
---------- ----------
Income (Loss) From Operations 762 (2,721)
Interest Expense (75) (105)
Investment Income 91 156
Interest Income - Related Parties 5 8
Other (Expense) Income (17) 1
Minority Interest in Income of Partnerships - (34)
Provision for Income Taxes (36) -
---------- ----------
NET INCOME (LOSS) $ 730 $ (2,695)
========== ==========
Net Income (Loss) Available to Common Stockholders $ 686 $ (2,695)
========== ==========
Basic Net Income (Loss) Per Common Share $ 0.14 $ (0.55)
========== ==========
Diluted Net Income (Loss) Per Common Share $ 0.13 $ (0.55)
========== ==========
Basic and Diluted Income Per Share - Common C $ 0.04 -
========== ==========
Weighted Average Basic Shares Outstanding 4,904,275 4,904,261
========== ==========
Weighted Average Diluted Shares Outstanding 5,031,779 4,904,261
========== ==========
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(000's OMITTED, except per share data)
FOR THE NINE MONTHS ENDED
MARCH 31,
----------------------
2009 2008
REVENUES ---------- ----------
Product sales - net $ 11,975 $ 8,940
Service and repair fees - net 6,936 7,444
Service and repair fees - related parties - net 966 786
Management and other fees - net 5,518 6,354
Management and other fees - related medical
practices - net 2,181 2,739
License fees and royalties 1,755 1,158
---------- ----------
Total Revenues - Net 29,331 27,421
---------- ----------
COSTS AND EXPENSES
Costs related to product sales 7,590 8,566
Costs related to service and repair fees 2,696 3,546
Costs related to service and repair
fees - related parties 376 375
Costs related to management and other fees 3,316 3,898
Costs related to management and other
fees - related medical practices 2,040 2,241
Research and development 2,681 3,675
Selling, general and administrative 9,955 15,544
Provision for bad debts 1,063 279
---------- ----------
Total Costs and Expenses 29,717 38,124
---------- ----------
Loss From Operations (386) (10,703)
Interest Expense (193) (362)
Investment Income 236 531
Interest Income - Related Parties 17 27
Other (Expense) Income (15) 7
Minority Interest in Income of Partnerships (11) (208)
Gain on Sale of Investment - 571
Gain on Sale of Consolidated Subsidiary 1,448 3,395
Provision for Income Taxes (36) -
---------- ----------
NET INCOME (LOSS) $ 1,060 $ (6,742)
========== ==========
Net Income (Loss) Available to Common Stockholders $ 997 $ (6,742)
========== ==========
Basic Net Income (Loss) Per Common Share $ 0.20 $ (1.38)
========== ==========
Diluted Net Income (Loss) Per Common Share $ 0.19 $ (1.38)
========== ==========
Basic and Diluted Income per share - Common C $ 0.05 -
========== ==========
Weighted Average Basic Common Shares Outstanding 4,904,275 4,895,907
========== ==========
Weighted Average Diluted Common Shares Outstanding 5,031,779 4,895,907
========== ==========
For investor and other information visit: www.fonar.com.
UPRIGHT® and STAND-UP® are registered trademarks and The Inventor of MR Scanning(TM), Full Range of Motion(TM), pMRI(TM), Dynamic(TM), Multi- Position(TM), True Flow(TM), The Proof is in the Picture(TM), Spondylography(TM) Spondylometry(TM) and Upright Radiology(TM) 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.
Contact:
Contact:
Daniel Culver
FONAR Corporation
Tel: 631-694-2929
Fax: 631-390-1709
http://www.fonar.com
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