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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OF 15(d) OF
THE SECURITIES ACT OF 1934
Date of Report
(Date of earliest event reported): December 1, 1995
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HYCOR BIOMEDICAL INC.
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(Exact name of registrant as specified in charter)
Delaware 0-11647 58-1437178
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) file no.) Identification no.)
18800 Von Karman Avenue, Irvine, California 92715-1517
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (714) 440-2000
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On December 1, 1995, registrant closed the sale to ALK Laboratories,
Inc. of all the capital stock of its wholly-owned subsidiary, Meridian
Bio-Medical, Inc., a Colorado corporation ("Meridian"). The purchase price for
such stock was $3,488,319, subject to adjustment based on the balance sheet of
Meridian as of the closing date. The registrant and the purchaser of the
Meridian stock are in the process of preparing such balance sheet and
determining such adjustment, if any. The registrant does not expect any
material adjustment in the purchase price to occur. The registrant has agreed
not to compete with the purchaser of the Meridian stock for a period of five
years from November 30, 1995 in the development, manufacture or sale of (A)
biological extracts useful to physicians for the in vivo diagnosis and/or
treatment of allergies or (B) diluents or sterile accessories useful for
formulating allergy treatment regimens.
Meridian accounted for approximately $2,947,000 and $2,141,000 of the
registrant's gross revenues for the fiscal year ended December 31, 1994 and for
the nine months ended September 30, 1995, respectively.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Business Acquired.
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None.
(b) Pro Forma Financial Information
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The following pro forma financial information is filed with
this report and can be located at the page in this report
noted below:
Page
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Historical and Pro Forma Condensed Consolidated
Balance Sheet as of September 30, 1995 (Unaudited). 3
Historical and Pro Forma Condensed Consolidated 4
Statement of Income for the nine months ended
September 30, 1995 (Unaudited).
Historical and Pro Forma Condensed Consolidated 5
Statement of Income for the year ended December 31,
1994.
Notes to Historical and Pro Forma Condensed 6
Consolidated Financial Statements.
(c) Exhibits
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The following exhibits are filed with this report:
10.01 Stock Purchase Agreement 9
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HYCOR BIOMEDICAL INC.
HISTORICAL AND PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, 1995
(Unaudited)
Pro Forma
Condensed
Hycor Biomedical Pro Forma Consolidated
(Historical) Adjustments Balance Sheet
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ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 6,350,362 $ 3,050,004 (2a,b) $ 9,400,366
Accounts Receivable, net 3,684,183 (268,352) (2b) 3,415,831
Inventories 6,941,339 (1,040,758) (2b) 5,900,581
Other current assets 1,299,729 (15,880) (2b) 1,283,849
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Total current assets 18,275,613 1,725,014 20,000,627
PROPERTY AND EQUIPMENT, net 5,751,641 (774,305) (2b) 4,977,336
GOODWILL AND OTHER INTANGIBLES 5,276,696 5,276,696
OTHER ASSETS, net 1,006,810 1,006,810
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Total assets $30,310,760 $ 950,709 $31,261,469
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES: $ 3,141,121 $ 319,064 (2b,c) $ 3,460,185
STOCKHOLDERS' EQUITY 27,169,639 631,645 (2b,d) 27,801,284
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Total liabilities and stockholders'
equity $30,310,760 $ 950,709 $31,261,469
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See notes to historical and pro forma
condensed consolidated financial statements
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HYCOR BIOMEDICAL INC.
HISTORICAL AND PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995
((Unaudited)
Pro Forma
Condensed
Hycor Biomedical Pro Forma Consolidated
(Historical) Adjustments Statement of Income
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NET SALES $18,938,102 $(2,140,819) (2e) $16,797,283
COST OF SALES 8,432,541 (1,091,319) (2e) 7,341,222
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Gross profit 10,505,561 (1,049,500) (2e) 9,456,061
OPERATING EXPENSES 8,776,304 (746,122) (2e) 8,030,182
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OPERATING INCOME 1,729,257 (303,378) 1,425,879
INTEREST INCOME, net 208,572 131,250 (2f) 339,822
GAIN ON FOREIGN CURRENCY TRANSACTION 182,236 182,236
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INCOME BEFORE TAXES 2,120,065 (172,128) 1,947,937
PROVISION FOR INCOME TAXES 850,366 (118,317) (2e) 732,049
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NET INCOME $ 1,269,699 $ (53,811) $ 1,215,888
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NET INCOME PER SHARE $ .15 $ .15
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WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 8,315,209 8,315,209
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See notes to historical and pro forma
condensed consolidated financial statements
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HYCOR BIOMEDICAL INC.
HISTORICAL AND PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1994
Pro Forma
Condensed
Hycor Biomedical Pro Forma Consolidated
(Historical) Adjustments Statement of Income
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NET SALES $ 25,896,591 $ (2,946,933) (2e) $ 22,949,658
COST OF SALES 11,450,936 (1,720,418) (2e) 9,730,518
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Gross profit 14,445,655 (1,226,515) 13,219,140
OPERATING EXPENSES 10,395,582 (882,065) (2e) 9,513,517
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OPERATING INCOME 4,050,073 (344,450) 3,705,623
INTEREST INCOME, net 374,125 175,000 (2f) 549,125
GAIN ON FOREIGN CURRENCY TRANSACTION 208,898 208,898
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INCOME BEFORE TAXES 4,633,096 (169,450) 4,463,646
PROVISION FOR INCOME TAXES 1,800,000 (124,000) (2e) 1,676,000
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NET INCOME $ 2,833,096 $ (45,450) $ 2,787,646
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NET INCOME PER SHARE $ .34 $ .33
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WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 8,452,806 8,452,806
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See notes to historical and pro forma
condensed consolidated financial statements
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HYCOR BIOMEDICAL INC.
NOTES TO HISTORICAL AND PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. BASIS OF PRESENTATION
On July 27, 1995, the Company announced plans for a major restructuring
designed to focus operations on high potential clinical immunology segments.
Included in the strategy is the discontinuation of several product areas in
which the Company currently participates.
On December 1, 1995, Hycor Biomedical Inc. (the "Company") sold to ALK
Laboratories, Inc. all of the capital stock of its wholly-owned subsidiary,
Meridian Bio-Medical, Inc., a Colorado corporation ("Meridian") as part of this
restructuring plan. The stock was sold for $3,488,319, subject to adjustment
based on the balance sheet of Meridian as of the closing date. The excess of
the sales price over net assets sold resulted in a credit that will be
considered in determining the impact of the above restructuring plan. The full
financial impact from this restructuring plan will be completed in the fourth
quarter of this year and will result in posting a one-time charge after taking
into account the credit resulting from this transaction.
The accompanying unaudited pro forma condensed consolidated balance sheet (the
Company's fiscal 1995 third quarter) assumes the disposition was consummated on
September 30, 1995 and gives effect to the adjustments described in Note 2.
The accompanying unaudited pro forma condensed consolidated statements of
income for the year ended December 31, 1994 and for the nine months ended
September 30, 1995 assume the disposition occurred as of the start of the
period and after giving effect to the adjustments described in Note 2.
The results of operations reflected in the unaudited pro forma condensed
consolidated statements of income are not necessarily indicative of the results
which would have been reported if the disposition had been effected at the
beginning of the period indicated or which may be reported in the future.
The unaudited pro forma condensed consolidated balance sheet and unaudited
condensed consolidated statements of income should be read in conjunction with
the audited consolidated financial statements and the related notes thereto of
the Company contained in its previously filed Annual Report on Form 10-K for
the year ended December 31, 1994.
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Note 2. PRO FORMA ADJUSTMENTS
The following adjustments are necessary to reflect the transaction described in
Note 1.
(a) Represents the net cash proceeds from the transaction after deduction
of estimated closing costs.
(b) Represents the elimination of historical balances of Meridian assets,
liabilities and stockholders equity.
(c) Represents the effect of establishment of the income tax provision on
pro forma gains from the transaction computed at statutory rates.
(d) Represents the net impact from pro forma adjustments to current
earnings.
(e) Represents the elimination of historical results from Meridian
operations.
(f) Represents estimated interest income earned on the proceeds from this
transaction based on the Company's current rate of return on existing
cash and cash equivalents.
Note 3. EARNINGS PER SHARE
The number of shares used in computing net income per share is the weighted
average number of shares outstanding during the period plus common stock
equivalents relating to options and warrants. The number of common stock
equivalents relating to options and warrants is determined using the treasury
stock method. Common stock equivalents are not included when their effect is
antidilutive. Fully diluted net income per share approximates primary net
income per share for each period.
Note 4. INTERIM ACCOUNTING POLICY
These statements have been prepared pursuant to the rules and regulations of
the Securities and Exchange Commission and do not include all information and
note disclosures required by generally accepted accounting principles for
complete financial statements and may be subject to year-end adjustments. The
financial information contained in this report reflects all adjustments which,
in the opinion of management, are necessary for a fair statement of the results
of the interim periods. All adjustments are of a normal nature except for
those described in Note 2.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
HYCOR BIOMEDICAL INC.
a Delaware Corporation
Dated: December 15, 1995 By: /s/ ARMANDO CORREA
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Armando Correa, Director of Finance
(Mr. Correa is the Principal Accounting
Officer and has been duly authorized to
sign on behalf of the registrant.)
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