UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d) of
The Securities Exchange Act of 1934
For quarter ended: March 31, 1998
Commission File No. 1-12575
UTAH MEDICAL PRODUCTS, INC.
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(Exact name of Registrant as specified in its charter)
UTAH 87-0342734
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7043 South 300 West
Midvale, Utah 84047
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Address of principal executive offices
Registrant's telephone number: (801) 566-1200
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and; (2) has been subject to such
filing requirements for the past 90 days. Yes X No
The number of shares outstanding of the registrant's common stock as of May
13, 1998: 8,313,036
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
UTAH MEDICAL PRODUCTS, INC. AND SUBSIDIARIES
CONDENSED BALANCE SHEETS AS OF MARCH 31, 1998 AND
DECEMBER 31, 1997
(unaudited)
MARCH 31, DECEMBER 31,
ASSETS 1998 1997
------------ ------------
CURRENT ASSETS:
Cash $ 1,253,863 $ 951,084
Accounts receivable - net 4,666,823 4,653,805
Inventories 5,402,871 5,792,058
Other current assets 717,382 655,433
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Total current assets 12,040,939 12,052,380
PROPERTY AND EQUIPMENT - NET 12,783,707 13,340,105
INTANGIBLE ASSETS - NET 6,189,031 6,066,751
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TOTAL $ 31,013,677 $ 31,459,236
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 997,247 $ 843,199
Accrued expenses 2,008,165 1,840,357
Revolving line of credit (due within
one year) 4,037,725
Deferred revenue 65,976 85,600
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Total current liabilities 7,109,113 2,769,156
REVOLVING LINE OF CREDIT 0 5,562,933
DEFERRED REVENUE 0 1,774
DEFERRED INCOME TAXES 489,989 489,989
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Total liabilities 7,599,102 8,823,852
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STOCKHOLDERS' EQUITY:
Preferred stock - $.01 par value;
authorized - 5,000,000 shares; no
shares issued or outstanding
Common stock - $.01 par value;
authorized - 50,000,000 shares;
issued - March 31, 1998, 8,305,036
shares December 31, 1997, 8,305,036
shares 83,050 83,050
Cumulative foreign currency
translation adjustment (1,031,962) (656,345)
Retained earnings 24,363,487 23,208,679
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Total stockholders' equity 23,414,575 22,635,384
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TOTAL $ 31,013,677 $ 31,459,236
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see notes to consolidated financial statements
UTAH MEDICAL PRODUCTS, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF INCOME FOR THE THREE MONTHS
ENDED MARCH 31, 1998 AND MARCH 31, 1997
(unaudited)
THREE MONTHS ENDED
MARCH 31,
------------------------------
1998 1997
NET SALES $ 6,374,538 $ 5,173,394
COST OF SALES 3,186,521 2,465,794
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GROSS MARGIN 3,188,017 2,707,600
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EXPENSES:
Selling, general and
administrative 1,610,365 1,377,138
Research & development 208,847 237,938
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Total 1,819,212 1,615,076
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INCOME FROM OPERATIONS 1,368,805 1,092,524
OTHER INCOME 456,199 528,401
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INCOME BEFORE INCOME TAX EXPENSE 1,825,004 1,620,925
INCOME TAX EXPENSE 666,126 580,940
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NET INCOME $ 1,158,878 $ 1,039,985
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EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE $ 0.14 $ 0.12
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EARNINGS PER COMMON SHARE
ASSUMING FULL DILUTION $ 0.14 $ 0.12
=========== ===========
SHARES OUTSTANDING - BASIC 8,305,000 8,632,000
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SHARES OUTSTANDING - DILUTED 8,313,000 8,732,000
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see notes to consolidated financial statements
UTAH MEDICAL PRODUCTS, INC. AND SUBSIDIARIES
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND MARCH 31, 1997
(unaudited)
MARCH 31,
------------------------
1998 1997
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $1,158,878 $1,039,985
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Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 486,394 309,328
Provision for losses on accounts
receivable 38,142 1,109
(Gain)/Loss on disposal of assets (9,000) 7,221
Deferred income taxes 78,311
Tax benefit attributable to exercise and
disposition of incentive stock options
and stock purchase rights 14,877
Changes in operating assets and liabilities:
Accounts receivable - trade 165,519 1,202,981
Accrued interest and other receivables (266,619) (18,739)
Inventories 299,494 (1,178,150)
Prepaid expenses (61,950) (157,703)
Accounts payable 171,850 88,767
Accrued expenses 169,051 13,920
Deferred revenue (21,400) (46,429)
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Total adjustments 971,481 315,493
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Net cash provided by operating activities 2,130,359 1,355,478
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CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures for:
Property and equipment (74,802) (520,520)
Intangible assets (225,518) (214,408)
Purchases of investments (112,200)
Proceeds from sale and maturities of
investments 516,977
Proceeds from sale of property and equipment 9,000 3,500
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Net cash used in investing activities (291,320) (326,651)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock 95,173
Common stock purchased and retired (2,258,366)
Decrease in note payable (1,525,208)
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Net cash used in financing activities (1,525,208) (2,163,193)
Effect of exchange rate changes on cash (11,052)
NET INCREASE (DECREASE) IN CASH 302,779 (1,134,366)
CASH AT BEGINNING OF PERIOD 951,084 3,038,956
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CASH AT END OF PERIOD $1,253,863 $1,904,590
========== ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for income
taxes $ 59,295 $ 12,260
Interest $ 90,713
see notes to consolidated financial statements
UTAH MEDICAL PRODUCTS, INC.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
(1) The unaudited financial statements presented herein have been prepared in
accordance with the instructions to form 10-Q and do not include all of the
information and note disclosures required by generally accepted accounting
principles. These statements should be read in conjunction with the financial
statements and notes included in the Utah Medical Products, Inc. ("UM" or "the
Company") annual report on form 10-K for the year ended December 31, 1997.
Although the accompanying financial statements have not been examined by
independent accountants in accordance with generally accepted auditing
standards, in the opinion of management, such financial statements include all
adjustments (consisting only of normal recurring adjustments) necessary to
summarize fairly the Company's financial position and results of operations.
(2) Inventories at March 31, 1998 and December 31, 1997 consisted of the
following:
March 31, December 31,
1998 1997
---------- --------------
Finished goods $1,388,850 $1,231,584
Work-in-process 989,685 1,204,873
Raw materials 3,024,336 3,355,601
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Total $5,402,871 $5,792,058
========== ==========
(3) The Company adopted Statement of Financial Accounting Standards (SFAS) No.
128, Earnings per Share during the year ended December 31, 1997. This standard
requires companies to present basic earnings per share (EPS) and diluted
earnings per share, including restating historical results, instead of the
primary and fully diluted EPS as previously required. The new standard also
makes modifications to the previously applicable EPS calculations found in APB
Opinion No. 15.
(4) Forward-Looking Information
This report contains certain forward-looking statements and information
relating to the Company that are based on the beliefs of management as well as
assumptions made by, and information currently available to, management. When
used in this document, the words "anticipate," "believe," "should," "project,"
"estimate," "expect," "intend" and similar expressions, as they relate to the
Company or its management, are intended to identify forward-looking statements.
Such statements reflect the current view of the Company respecting future events
and are subject to certain risks, uncertainties, and assumptions, including the
risks and uncertainties noted throughout the document. Although the Company has
attempted to identify important factors that could cause the actual results to
differ materially, there may be other factors that cause the forward statement
not to come true as anticipated, believed, projected, expected, or intended.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may differ materially
from those described herein as anticipated, believed, projected, estimated,
expected, or intended.
General risk factors that may impact the Company's revenues include the
market acceptance of competitive products, obsolescence caused by new
technologies, the possible introduction by competitors of new products that
claim to have many of the advantages of UM's products at lower prices, the
timing and market acceptance of UM's own new product introductions, UM's ability
to efficiently manufacture its products, including the reliability of suppliers,
success in gaining access to important global distribution channels, marketing
success of UM's distribution and sales partners, budgetary constraints, the
timing of regulatory approvals for newly introduced products, and third party
reimbursement.
Risk factors, in addition to the risks outlined in the previous paragraph
that may impact the Company's assets and liabilities, as well as cash flows,
include risks inherent to companies manufacturing products used in health care
including claims resulting from the improper use of devices and other product
liability claims, defense of the Company's intellectual property, productive use
of assets in generating revenues, management of working capital including
inventory levels required to meet delivery commitments at a minimum cost, and
timely collection of accounts receivable.
Additional risk factors that may affect non-operating income include the
continuing viability of the Company's technology license agreements, actual cash
and investment balances, asset dispositions, and acquisition activities that may
require external funding.
(5) Events subsequent to March 31, 1998:
On April 23, 1998, UM announced it had signed a letter of intent with another
medical products company for an asset purchase of an established product line
that will complement UM's other product offerings. Completion of the
transaction, which is scheduled to occur before the end of June, is contingent
on UM's board approval after final due diligence and completion of a definitive
legal agreement acceptable to both parties.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Analysis of Results of Operations
Because of the relatively short span of time, results for any given three
month period in comparison with a previous three month period may not be
indicative of comparative results for the year as a whole.
a) First Quarter (1Q) Overview
Total sales in 1Q 1998 increased 23.2% from sales in 1Q 1997. Combined
Ob/Gyn sales increased 41.3% relative to 1Q 1997, while critical care sales
decreased 4.4%. The addition of Columbia Medical, Inc. (CMI) to 1Q 1998
results, and the short-term negative impact in 1Q 1997 from switching to direct
sales representatives from stocking distributors in two regions of the U.S.
explain most of the 1Q 1998 Ob/Gyn sales increase. Lower sales to Baxter are
responsible for the decrease in critical care sales. Gross margins were lower
at 50.0% of sales in 1Q 1998 compared to 52.3% in 1Q 1997, while operating
profit margins increased to 25.3% of sales in 1Q 1998 from 21.1% in the same
period of 1997. Gross margins in 1Q 1998 were negatively impacted by materials
and international product mix issues. Operating margins benefitted from lower
operating expense ratios, down from 31.2% of sales in 1Q 1997 to 28.5% of sales
in 1Q 1998. Actual operating expenses were $204,000 higher due mainly to the
addition of CMI, including amortization of goodwill from that acquisition.
Other income decreased $72,000 in 1Q 1998 from the same period in 1997, due
mainly to higher interest expense in 1998. Net income, at $1,159,000 in 1Q
1998, increased $119,000 in 1Q 1998 from the first quarter of 1997. Earnings
per share (eps) of 14c in 1Q 1998 compared with 12c in 1Q 1997 were aided by
418,300 fewer diluted shares outstanding in 1Q 1998.
b) Revenues
UM divides revenues into three categories: 1) obstetrics, comprised of a
full line of equipment and supplies used in hospitals' labor & delivery
departments for fetal monitoring, operative vacuum delivery, umbilical cord
management, and meconium aspiration, as well as other needs; 2) gynecology/
urology/ electrosurgery (ES) equipment and tools used especially for a
gynecologic electrosurgical procedure called LETZR, but also other
electrosurgical procedures including endoscopic procedures, and other non-
gynecological procedures such as tonsillectomies by otolaryngologists, abdominal
reconstructions and breast reductions by plastic surgeons, mammary artery grafts
by thoracic surgeons, nevus excision by dermatologists, and tumor excisions by
all surgeons; other tools used in other minimally invasive surgical procedures
including diagnostic laparoscopies; urinary incontinence management devices; and
urology pumps; and 3) disposable components used in critical care applications,
especially invasive blood pressure and ICP monitoring, but also disposable
respiratory products. Revenues from contract molding are also included in the
"critical care" revenue category.
Sales of obstetrics products in 1Q 1998 were $3,398,000 compared to
$2,335,000 in 1Q 1997. Starting in the third quarter of 1997, revenues from CMI
were included in UM's business, including operative vacuum delivery systems. In
1Q 1997, UM's Intran sales were lower than they otherwise would have been due to
UM's conversion of two distributors to direct sales representatives, allowing
time for the distributors to sell off remaining inventory. In 1Q 1998, sales
of Intran represented 76% of obstetrics sales compared to 95% in 1Q 1997. Also,
beginning in 3Q 1997, UM introduced several versions of Intran Plus designed to
address user preferences in tip size, zero switch location and amniotic fluid
visualization. As a percentage of total UM sales, obstetrics product revenues
represented 53% in 1Q 1998 compared to 45% in 1Q 1997.
Gynecology/urology/ES product sales were $1,023,000 in 1Q 1998 compared to
$797,000 in 1Q 1997. As in the obstetrics category, the first quarter 1997
distributor terminations reduced sales in this category. Several new products
are aiding growth in this category, including EpitomeR, a unique ES scalpel,
LibertyR, a conservative therapy for female urinary incontinence, Pathfinder
Plus , an irrigation device for endoscopic procedures, and CMI's urology pumps.
In 1Q 1998, this category of revenues represented 16% of total UM sales compared
to 15% in 1Q 1997. A number of the products in this category are designed for
use in physicians' offices or outpatient clinics, and therefore represent
important diversification for UM's business.
Critical care revenues were $1,953,000 in 1Q 1998 compared to $2,042,000 in
1Q 1997. Included in this category are transducers and other components used in
blood pressure monitoring sold to Baxter, which sales in 1Q 1998 were $109,000
compared to $454,000 in 1Q 1997. The decline in sales to Baxter was partially
offset by higher sales of pressure monitoring devices to other similar
customers.
First quarter 1998 foreign sales were $1,242,000, compared to $1,194,000 in
the same period of 1997. None of the 1Q 1998 foreign sales were to Baxter,
compared to $114,000 of foreign sales to Baxter in 1Q 1997. Critical care
products represented 84% of international sales in both periods. Foreign sales
comprised 19% of total non-Baxter sales in 1Q 1998, compared to 16% in 1Q 1997.
UM continues to believe it has substantial sales potential for its existing
products in international markets.
c) Gross Profit
Gross margins (profit after subtracting costs of manufacturing products from
revenues) in 1Q 1998, were 50.0% compared to 52.3% in 1Q 1997. Gross margins
were lower in 1Q 1998 because of an unfavorable mix of international blood
pressure monitoring sales, the impact of exchange rates on those sales, and
unfavorable direct materials ratios from reducing slower moving inventory. A
short-term challenge for UM is absorption of manufacturing overhead given the
current sales volumes and depreciation related to recent increases in fixed
assets.
During the first quarter 1998, UM completed the CMI consolidation with the
transfer of assembly operations on vacuum extraction disposables from Oregon to
Utah and Ireland. Except for its own independent OEM business, CMI is
essentially now a subcontract molding operation for UM. Starting with the
second quarter of 1998, UM should see some incremental cost reductions from the
transfer.
Gross margin improvements can be achieved if UM can further increase sales
activity to better absorb its overhead expenses. On the other hand, management
expects continued competitive pressure for its established products that may
reduce average selling prices and therefore put additional pressure on gross
margins during the remainder of 1998.
d) Income from Operations
Operating profit, or income from operations, are the profits achieved after
subtracting operating expenses from gross profits. Operating profits in 1Q 1998
were $1,369,000 compared to $1,093,000 in 1Q 1997. Even though 1Q 1998 gross
margins declined as a percentage of sales, operating profits increased to 21.5%
of sales from 21.1% of sales in 1Q 1997. First quarter 1998 operating expenses
in dollars increased by $204,000 relative to 1Q 1997, including amortization of
goodwill at a rate of about $84,000 per quarter, but decreased to 28.5% of
revenues in 1Q 1998 compared to 31.2% of revenues in 1Q 1997 because of
increased sales volume.
Operating expenses are subdivided into sales, general and administrative
expenses (SG&A) and research and development expenses (R&D). UM further divides
SG&A into the two categories of sales and marketing expenses (S&M) and general
and administrative expenses (G&A).
SG&A expenses in 1Q 1998 decreased to 25.3% of revenues compared to 26.6% in
1Q 1997. Higher sales in 1Q 1998 compared to 1Q 1997 more than offset the
impact of increased goodwill amortization associated with the July 1997 CMI
acquisition. UM expects SG&A expenses as a percentage of sales to remain close
to the 1Q 1998 rate for the near future.
UM's S&M expenses are driven primarily by the direct sales portion of its
business. S&M expenses in 1Q 1998 were $945,000 compared to $832,000 in 1Q
1997. Although UM desires to increase its OEM customers for its blood pressure
monitoring products and other products which serve markets that are outside UM's
sales focus, management expects that the direct portion of UM's business will
grow faster than the OEM portion, which represented just 15% of total sales in
1Q 1998 compared to 19% in 1Q 1997. The 1997 distribution mix changes that had
a positive impact on gross margins have an offsetting negative effect on selling
expenses. Management believes that achieving closer contact with end-users of
its specialty products, as well as having closer control of how its sales
resources spend limited time, are key elements to implementing its value-added
niche marketing strategies. At the beginning of 1Q 1998, UM terminated an
additional distributor, further decreasing the percentage of total direct U.S.
sales through stocking distributors versus UM's own sales representatives.
G&A expenses increased $121,000 to $666,000 in 1Q 1998, relative to 1Q 1997.
Included in G&A expenses was amortization of goodwill related to the CMI
acquisition of $84,000. UM plans to hold its 1998 G&A dollar expenses in Utah
and Ireland consistent with 1997, but the addition of G&A expenses related to
CMI added together with amortization of goodwill will likely result in G&A
expenses as a percentage of sales approximately the same in 1998 as in 1997.
R&D expenses were $209,000 in 1Q 1998 compared to $238,000 in 1Q 1997, 3.3%
and 4.6% of sales, respectively. A major portion of UM's internal product
development expenditures are focused on its novel fetal pH monitoring project.
Other projects include the Fowler Endocurette, electrosurgery electrodes,
incontinence products and continued development of Cordguard. Products recently
acquired in the purchase of CMI are being enhanced or further developed. UM not
only obtains new products through internal development, but also through
cooperative development with others, licensing of others' products, and
acquisitions.
e) Non-operating (Other) income.
Non-operating income includes royalties from licensing UM's technology to
other companies, interest and capital gains from investing the Company's cash
(offset by interest on UM's debt obligations), and gains or losses from the sale
of assets. Non-operating income declined $72,000 in 1Q 1998 from 1Q 1997. Non-
operating income in 1Q 1998 represented about 25% of pretax income, compared to
33% in 1Q 1997. Interest payments by UM of about $91,000 were responsible for
the decline. In both periods, payments for the use of UM's technology comprised
the largest portion of non-operating income. Royalties from other medical device
companies continue to constitute a major portion of the non-operating income.
Royalties received vary from period to period depending on the interest in UM's
patents and/or success of other companies in selling licensed product concepts.
Management estimates non-operating income for the final three quarters of 1998
combined will be approximately equal to the first quarter amount, barring new
technology licensing or other similar transactions.
f) Earnings Before Income Taxes and Net Income
Earnings before income taxes (EBT) result from adding non-operating and
operating income together. EBT, as a percentage of sales, were 28.6% in 1Q 1998
compared to 31.3% in 1Q 1997.
Net income is EBT minus income taxes. Net income in 1Q 1998 was $1,159,000,
compared to $1,040,000 in 1Q 1997. Net income as a percentage of sales, at
18.2% in 1Q 1998 and 20.1% in 1Q 1997, ranks UM in the top profitability tier of
U.S. publicly traded companies. UM's effective income tax rate was 36.5% in 1Q
1998 compared to 35.8% in 1Q 1997. UM's effective rate includes federal and
state income taxes in the U.S., as well as taxes overseas. The increased tax
rate in 1Q 1998 reflects the non-deductibility of goodwill for tax purposes
associated with the CMI acquisition, a difference in the distribution of state
taxes, a smaller amount of non-operating income coming from tax-exempt
securities, and other fluctuations associated with the use of a foreign sales
corporation and R&D tax credits.
g) Earnings per share (EPS).
EPS is net income divided by the number of shares of stock outstanding
(diluted to take effect for stock options awarded which have exercise prices
below the current market value). Diluted EPS for 1Q 1998 were $.14 compared to
$.12 for 1Q 1997. Weighted average common shares in 1Q 1998 assuming dilution
(the number used to calculate diluted EPS) were 8,313,000 compared to 8,732,000
in 1Q 1997. Actual outstanding common shares as of March 31, 1998 were
8,305,036 compared to 8,608,486 as of March 31, 1997. The dilution calculation
added about 8,000 shares to basic shares outstanding in 1Q 1998, compared to
about 99,000 in 1Q 1997.
h) Return on shareholders' equity (ROE).
ROE is the portion of net income retained by UM to internally finance its
growth, divided by average accumulated shareholders' equity during the period.
This ratio determines how fast the Company can afford to grow without external
financing that would dilute shareholder interests. For example, a 30% ROE will
support 30% growth in revenues. ROE in 1Q 1998 and 1997, at 20% and 18%,
respectfully, was below management's target of 25%. The primary factor that
lowered ROE in the two periods was the lower number of asset turns, that is, the
level of sales activity relative to total assets was too low. Including 1997,
ROE has averaged 30% over the prior twelve years.
i) Cash Flows
EBDIT (EBT, adjusted for non-cash depreciation and amortization expenses,
asset write-offs, and interest expense) are the measure of UM's ability to
generate cash. 1Q 1998 EBDIT were $2,393,000 compared to $1,937,000 in 1Q 1997,
or as a ratio of sales, 37.5% in both periods. EBDIT has averaged 34% of sales
over the last five years. Generating cash at a rate above one-third of sales
provides UM with a powerful financial engine for growth. The Company obtained
additional financing starting in 2Q 1997 through its revolving line of credit
(LOC), which as of March 31, 1998, provided an additional $4,038,000 in cash to
facilitate the timing of the CMI acquisition.
Cash (and equivalent) balances were $1,254,000 at March 31, 1998, an
increase of $303,000 from December 31, 1997. The most significant use of cash
in 1Q 1998 was $1,525,000 to pay down the LOC, which was also reclassified as a
short-term liability from long-term during 1Q 1998 because the remaining term on
the LOC is under 12 months as of March 31, 1998. Net working capital changes
provided $456,000 in 1Q 1998 cash, with the largest contribution being a
$299,000 reduction in inventories (adjusted for exchange rate changes).
During 1Q 1998, UM spent $226,000 on the purchase of technology rights and
prosecution of new patents, along with $75,000 on improvements to property and
equipment. During 1Q 1997, UM spent a similar amount on intangible assets, but
over $500,000 on property and equipment, primarily on completing the Irish
manufacturing facility. Excluding the possibility of additional acquisitions of
new products, technology or marketing rights (also excluding any potential
impact from UM's recently announced intent to purchase a product line from
another company, if successfully completed), UM plans for capital expenditures
during the remainder of 1998 to be less than during 1997 and less than current
depreciation rates.
Financing activities in 1Q 1998 resulted in a cash decrease of $1,525,000
compared to a decrease of $2,163,000 in 1Q 1997. In 1Q 1998 the decrease
resulted from reducing UM's LOC balance, while in 1Q 1997 the decrease was the
result of stock repurchases. No new stock was issued during 1Q 1998. Amounts
borrowed under the LOC are unsecured and are due March 25, 1999.
j) Management's Outlook
UM's challenge is to grow its niche-oriented business by successfully
introducing and selling products which cost effectively meet the needs of
patients and clinicians. UM will continue to look for ways to increase the rate
of adoption of new products for specific Ob/Gyn clinical needs where innovations
can become the most recognized cost-effective solution. The Fowler Endocurette
for uterine biopsies is an example of such a device. UM plans to begin
marketing the Endocurette in 1998 after receiving FDA premarketing concurrence.
With the help of the CMI acquisition, UM now offers the most complete line
of supplies needed in labor & delivery departments of hospitals, and is no
longer as dependent on one product, Intran, for a majority of its OB sales.
Additional acquisitions, such as the one that would result from a successful
conclusion of the agreement announced on April 23, 1998 (see Note 5 on page 5,
above) could significantly benefit UM.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
SEC
Exhibit # Reference # Title of Document
- --------- ----------- ------------------------
1 27 Financial data schedule
b) Reports on Form 8-K:
During the quarter ended March 31, 1998, the Company filed no reports on
Form 8-K.
Subsequent to March 31, on April 7, 1998, UM filed a report on Form 8-K,
Item 6, Resignation of Registrant's Directors, reporting that Perry L. Lane
resigned as a director, effective April 1, 1998 (see note 5 on page 5,
above).
SIGNATURES
Pursuant to the requirements of the Securities Exchanges Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
UTAH MEDICAL PRODUCTS, INC.
REGISTRANT
Date: 5/13/98 By: /s/ Kevin L. Cornwell
CEO and CFO