1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly period ended March 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to _______________
Commission file number 1-9913
KINETIC CONCEPTS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Texas 74-1891727
- ------------------------------- ------------------------------------
(State of incorporation) (I.R.S. Employer Identification No.)
8023 Vantage Drive
San Antonio, Texas 78230 210/524-9000
- ------------------------------- ------------------------------------
(Address of principal executive (Registrant's telephone number)
offices and zip code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 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 require- ments for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock: 44,111,562 shares as of March 31, 1995
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
KINETIC CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
March 31,
1995 December 31,
Assets (unaudited) 1994
- ------ ----------- ------------
Current assets:
Cash and cash equivalents $ 47,510 $ 43,241
Accounts receivable, net 54,668 55,456
Finance lease receivables, current 9,040 8,051
Inventories 19,656 18,167
Notes receivable, current, net 3,525 6,014
Prepaid expenses 5,227 4,474
-------- --------
Total current assets 139,626 135,403
-------- --------
Net property, plant and equipment 54,305 51,357
Finance lease receivables, net of current 6,095 7,242
Notes receivable, net of current and allowance 3,187 3,187
Goodwill, net 15,003 15,476
Other assets, net 15,893 15,989
Deferred income tax benefit, net 3,904 4,077
-------- --------
$238,013 $232,731
-------- --------
Liabilities and Shareholders' Equity
- ------------------------------------
Current liabilities:
Note payable $ 2,649 $ 1,878
Current installments of long-term obligations 1,204 3,410
Accounts payable 5,397 4,079
Accrued expenses 24,104 27,280
Income taxes payable 8,681 8,025
-------- --------
Total current liabilities 42,035 44,672
-------- --------
Long-term obligations, excluding current installments 3,775 2,636
-------- --------
Total liabilities 45,810 47,308
-------- --------
Shareholders' equity:
Common stock; issued and outstanding 44,112 in
1995 and 43,921 in 1994 44 44
Additional paid-in capital 11,096 10,053
Retained earnings 179,929 175,480
Cumulative foreign currency translation adjustment 1,134 (154)
-------- --------
Total shareholders' equity 192,203 185,423
-------- --------
$238,013 $232,731
-------- --------
See accompanying notes to condensed consolidated financial statements.
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ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
KINETIC CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three months ended
March 31,
----------------------
1995 1994
-------- --------
Revenue:
Service and rental $ 48,422 $ 61,747
Sales and other 8,605 10,337
-------- --------
Total revenue 57,027 72,084
-------- --------
Rental expenses 33,427 44,436
Cost of goods sold 3,916 5,132
-------- --------
37,343 49,568
-------- --------
Gross profit 19,684 22,516
Selling, general and administrative expenses 10,107 13,355
-------- --------
Operating earnings 9,577 9,161
Net interest (income) expense (533) 1,854
-------- --------
Earnings before income taxes, minority interest
and cumulative effect of change in
accounting principle 10,110 7,307
Income taxes 4,012 3,825
-------- --------
Earnings before minority interest and cumulative
effect of change in accounting principle 6,098 3,482
Minority interest in subsidiary loss - 40
Cumulative effect of change in method of accounting
for inventory, net - 742
-------- --------
Net earnings $ 6,098 $ 4,264
-------- --------
Earnings per common and common equivalent share:
Earnings before cumulative effect of
change in accounting principle $ 0.14 $ 0.08
Cumulative effect of change in method of
accounting for inventory - 0.02
-------- --------
Earnings per share $ 0.14 $ 0.10
-------- --------
Shares used in earnings per share computations 45,115 43,986
-------- --------
See accompanying notes to condensed consolidated financial statements.
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ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
KINETIC CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
Three months ended
March 31,
-----------------------
1995 1994
-------- --------
Cash flows from operating activities:
Net earnings $ 6,098 $ 4,264
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation and amortization 5,814 12,103
Provision for uncollectible accounts receivable (48) 803
Change in assets and liabilities:
Decrease (increase) in accounts receivable 1,115 (1,735)
Decrease in notes receivable 2,489 -
Increase in inventories (1,349) (1,456)
Decrease (increase) in prepaid expenses (782) 52
Increase in other assets - (301)
Increase (decrease) in accounts payable 1,508 (1,382)
Increase (decrease) in accrued expenses (3,054) 1,139
Increase in income taxes payable 656 3,961
Increase (decrease) in deferred income taxes 173 (750)
-------- --------
Net cash provided by operating activities 12,620 16,698
-------- --------
Cash flows from investing activities:
Additions to property, plant, and equipment (4,427) (4,022)
Increase in inventory to be converted into equipment
for short-term rental (3,750) (500)
Dispositions of property, plant, and equipment 185 434
Decrease in finance lease receivables 158 376
Increase in other assets - (468)
-------- --------
Net cash used by investing activities (7,834) (4,180)
-------- --------
Cash flows from financing activities:
Repayments of note payable and long-term obligations (296) (7,378)
Repayments of capital lease obligations (119) (807)
Proceeds from the exercise of stock options 1,043 5
Minority interest in subsidiary loss, net - (40)
Purchase of treasury stock - (41)
Cash dividends paid to shareholders (1,649) -
Other - (668)
-------- --------
Net cash used by financing activities (1,021) (8,929)
-------- --------
Effect of exchange rate changes on cash and cash equivalents 504 (5)
-------- --------
Net increase in cash and cash equivalents 4,269 3,584
Cash and cash equivalents beginning of year 43,241 10,280
-------- --------
Cash and cash equivalents end of period $ 47,510 $ 13,864
-------- --------
Supplemental disclosure of cash flow information:
Cash paid during the first three months for:
Interest $ 210 $ 1,172
Income taxes 4,048 57
See accompanying notes to condensed consolidated financial statements.
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ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
KINETIC CONCEPTS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
(1) BASIS OF PRESENTATION
The financial statements presented herein include the accounts of Kinetic
Concepts, Inc. and all subsidiaries (the "Company"). The foregoing
financial information reflects all adjustments (consisting only of normal
recurring adjustments) which are, in the opinion of management, necessary
for a fair presentation of the financial position and results of operations
for the interim periods presented. Interim period operating results are
not necessarily indicative of the results to be expected for the full
fiscal year. The financial information presented for the interim periods
is unaudited and subject to year-end audit and adjustments.
(2) INVENTORY COMPONENTS
Inventories are stated at the lower of cost (first-in, first-out) or
market (net realizable value). Inventories are comprised of the following
(in thousands):
March 31, December 31,
1995 1994
--------- ------------
Finished goods $ 5,115 $ 3,086
Work in process 3,533 1,642
Raw materials, supplies and parts 19,008 17,689
------- -------
27,656 22,417
Less amounts expected to be
converted into equipment for
short-term rental 8,000 4,250
------- -------
$19,656 $18,167
------- -------
(3) SHARES USED IN EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE COMPUTATIONS
The weighted average number of common and common equivalent shares used in
the computation of earnings per share is as follows (in thousands):
Three months ended
March 31,
------------------
1995 1994
------ ------
Average outstanding common shares 43,997 43,947
Average common equivalent shares-
dilutive effect of option shares 1,118 39
------ ------
Shares used in earnings
per share computations 45,115 43,986
------ ------
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ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
Earnings per common and common equivalent share are computed by dividing
net earnings by the weighted average number of common and dilutive common
equivalent shares outstanding during the period. Dilutive common
equivalent shares consist of stock options (using the treasury stock
method). Earnings per share computed on a fully diluted basis is not
presented as it is not significantly different from earnings per share
computed on a primary basis.
(4) CREDIT AGREEMENT
On May 8, 1995, the Company entered into a revolving credit agreement (the
"Credit Agreement") with a bank as an agent for itself and certain other
financial institutions. The Credit Agreement provides for a $50 million
one-year revolving credit facility (the "Revolver") with one (1) two-year
option to renew. Any advances under the Revolver are due at the end of the
period covered by the Credit Agreement.
The interest rate payable on borrowings under the Credit Agreement is at
the election of the Company: (i) the Bank's reference rate, or (ii) the
London inter-bank offered rate quoted to the Bank for one, two, three, or
six month Eurodollar deposits adjusted for appropriate reserves ("LIBOR")
plus 40 basis points.
The Credit Agreement requires that the Company maintain specified ratios
and meet certain financial targets. The Credit Agreement also contains
certain events of default, includes certain provisions, and establishes
various fees to be paid by the Company.
At March 31, 1995, the entire amount of the then existing Revolver was
available under the previous Credit Agreement. In addition, the Company
was in compliance with all covenants under the previous Credit Agreement.
(5) ACQUISITIONS AND DISPOSITIONS
In December of 1994, the Company adopted a plan to liquidate the assets of
Medical Retro Design, Inc. ("MRD"). Pursuant to that plan, the Company
sold certain assets of MRD to HBR Healthcare Co. ("HBR") under an Asset
Purchase Agreement effective March 27, 1995. Upon consummation of this
transaction, HBR acquired the operating assets of MRD. The sales price was
approximately $250 thousand. In conjunction with the sale, KCI and its
affiliates agreed not to refurbish certain hospital beds and related
furniture for a period of three (3) years. MRD accounted for less than
two percent (2%) of the Company's total revenue during 1994. First quarter
1995 operations of MRD were immaterial to the overall results of the
Company.
(6) COMMITMENTS AND CONTINGENCIES
The Company is party to several lawsuits generally incidental to its
business and is contesting certain adjustments proposed by the Internal
Revenue Service to prior years' tax returns. Provisions have been made in
the accompanying financial statements for estimated exposures related to
these lawsuits and adjustments. In the opinion of management, the
disposition of these items will not result in any material additional
liability to the Company.
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Independent Auditors' Report
The Board of Directors
Kinetic Concepts, Inc.:
We have reviewed the condensed consolidated balance sheet of Kinetic Concepts,
Inc. and subsidiaries as of March 31, 1995, and the related condensed
consolidated statements of earnings and cash flows for the three-month periods
ended March 31, 1995 and 1994. These condensed consolidated financial
statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical review procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the condensed consolidated financial statements referred to above for
them to be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Kinetic Concepts, Inc. and
subsidiaries as of December 31, 1994, and the related consolidated statements of
earnings, capital accounts, and cash flows for the year then ended (not
presented herein); and in our report dated February 14, 1995, we expressed an
unqualified opinion on those consolidated financial statements. In our opinion,
the information set forth in the accompanying condensed consolidated balance
sheet as of December 31, 1994, is fairly presented, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.
KPMG Peat Marwick LLP
San Antonio, Texas
April, 21 1995
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
FIRST QUARTER OF 1995 COMPARED TO FIRST QUARTER OF 1994
The following table sets forth, for the periods indicated, the percentage
relationship of each item to total revenue as well as the percentage change of
each line item as compared to the first quarter of the prior year (in
thousands, except per share data):
Three Months Ended March 31,
-----------------------------------
1995 1994 Increase (decrease)
---- ---- -------------------
Revenue:
Service and rental 85% 86% (22%)
Sales and other 15% 14% (17%)
--- ---
100% 100% (21%)
Rental expenses 59% 62% (25%)
Cost of goods sold 7% 7% (24%)
--- ---
Gross profit 34% 31% (13%)
Selling, general and administrative expenses 17% 18% (24%)
--- ---
Operating earnings 17% 13% 5%
Net interest (income) expense (1%) 3% (129%)
--- ---
Earnings before income taxes, minority
interest and cumulative effect of
change in accounting principle 18% 10% 38%
Income taxes 7% 5% 5%
--- ---
Earnings before minority interest and
cumulative effect of change in
accounting principle 11% 5% 75%
Minority interest in subsidiary loss - - -
Cumulative effect of change in method
of accounting for inventory - 1% -
--- ---
Net earnings 11% 6% 43%
--- ---
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
The comparability of the Company's financial results in the first quarters
of 1994 and 1995 was significantly impacted by the disposition of its Medical
Services Division. On September 30, 1994, KCI Therapeutic Services, Inc.
("KCTS"), a wholly-owned subsidiary of the Company, sold certain assets used
exclusively by the KCTS Medical Services Division (the "Medical Services
Division") to Mediq/PRN Life Support Services-I, Inc. under an Asset Purchase
Agreement. Revenue, gross profit and operating results related to the Medical
Services Division for the first quarter of 1994 were as follows (in thousands):
Revenue $16,348
Gross Profit 5,707
Operating Earnings 1,208
Excluding the prior-year results of the Medical Services Division, total
revenue in the first quarter of 1995 increased by 2.3% to $57.0 million from
$55.7 million in the first quarter of 1994. Revenue from the Company's
specialty patient surface business including acute care and alternate care, was
$38.0 million, down 6.9% from the first quarter of 1994. This decrease was due
substantially to sluggish industry and seasonal conditions which reduced revenue
from acute care facilities, partially offset by continuing gains in nursing,
rehabilitation and home care settings. Revenue from the Company's International
operations was $13.7 million, up 37.0% from the first quarter of 1994.
Continued growth of this market, as well as better utilization of the existing
rental fleet and improved sales efforts have contributed towards increased
revenues. Revenue from medical device operations increased 15.2% to $3.7
million in the first quarter of 1995 related primarily to greater market
penetration as this division expanded into new states.
Rental expenses were 58.6% of total revenue in the first quarter of 1995
compared to 61.6% in the first quarter of 1994. This decrease is primarily
attributable to reduced depreciation expense as well as an overall effort to
control costs.
Gross profit excluding the Medical Services Division increased 17.1% to
$19.7 million in the first quarter of 1995 from $16.8 million in the first
quarter of 1994 due to the increase in revenue from ongoing operations as well
as the decrease in rental expenses.
Selling, general and administrative expenses decreased $3.3 million or
24.3% to $10.1 million in the first quarter of 1995 from $13.4 million in the
first quarter of 1994. Selling, general and administrative expenses as a
percentage of total revenue decreased to 17.7% in the first quarter of 1995
from 18.5% in the first quarter of 1994. This decline is primarily
attributable to the elimination of various support departments and corporate
personnel following the sale of the Medical Services Division, as well as
reduced bad debt expense.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
Excluding the Medical Services Division, operating earnings for the
period increased 20.4% to $9.6 million compared to $8.0 million in the prior
year quarter as a result of increased revenues.
Net interest income for the three months ended March 31, 1995 was $0.5
million, compared to net interest expense of $1.9 million in the prior year.
This change was a combination of the prior year pay-down of long term
obligations, interest earned on cash reserves and interest earned on notes
receivable.
The Company's effective income tax rate in the first quarter of 1995 was
39.7%, compared to 52.3% in the first quarter of 1994. The effective tax rate
for the first quarter of 1995 was lower than the effective rate for the first
quarter of 1994 primarily as a result of the recognition of the net operating
loss of Medical Retro Design, Inc. and recognition of foreign tax credits.
During the first quarter of 1994, the cumulative losses allocated to the
minority interest holder, Medical Retro Design, exceeded the balance of its
investment. As a result, losses of $3.8 million were absorbed entirely by the
Company in 1994. These continuing losses and diminished opportunities within
the refurbishment business led to the decision to liquidate this unit in
December of 1994 and the eventual sale of MRD assets in March 1995. First
quarter 1995 operations of the MRD unit were immaterial to the overall results
of the Company. See Note 5 of Notes to Condensed Consolidated Financial
Statements.
During the first quarter of 1994, the Company recorded a cumulative
effect of a change in accounting principle related to its inventory costing
method which resulted in a one-time after-tax earnings increase of $742,000, or
$0.02 per share.
On a comparable basis, net earnings from ongoing operations more than
doubled to $6.1 million in the first quarter of 1995 from $2.9 million in the
first quarter of 1994. Earnings per share from ongoing operations (before the
effect of the cumulative change described above) increased 100.0% to $0.14 per
share from $0.07 per share in the prior year quarter. Earnings per share as
reported increased 40% from $0.10 per share in the prior year quarter. This
increase was primarily due to a decrease in rental expenses, net interest, and
selling, general and administrative expenses and the change in revenue as
discussed above.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
FINANCIAL CONDITION
The change in revenue and expenses experienced by the Company during the
first quarter of 1995 and other factors resulted in changes to the Company's
balance sheet as follows:
Inventory at March 31, 1995 increased $1.5 million, or 8.2%, to $19.7
million from $18.2 million at December 31, 1994 primarily due to new product
introductions.
Net property, plant and equipment at March 31, 1995 increased $2.9
million, or 5.7%, to $54.3 million from $51.4 million at December 31, 1994
due to additions to rental equipment in excess of depreciation and
dispositions.
Total notes receivable at March 31, 1995 decreased $2.5 million, or
27.1%, to $6.7 million from $9.2 million at December 31, 1994 due to payments
received during the first quarter of 1995.
Note payable and current installments of long-term obligations decreased
$1.4 million to $3.9 million at March 31, 1995 from $5.3 million at December
31, 1994 primarily due to repayments made.
Accrued expenses at March 31, 1995 decreased $3.2 million, or 11.6%, to
$24.1 million from $27.3 million at December 31, 1994 primarily due to
settlements of accruals related to the sale of the Medical Services Division
and bonus payments made in the first quarter of 1995.
MARKET TRENDS
For the past decade, the health care industry has experienced increased
pressure from a variety of sources to control costs and improve patient
outcomes. This pressure intensified in 1993 as our nation debated health care
reform. Although the events of 1994 would seem to indicate that major
legislative reform of our health care system is unlikely at this time, it is
apparent that the health care industry will seek to become more cost effective
and further improve patient outcomes.
Since 1987, the Company has been positioning itself to remain competitive
in an environment which demands accountability for patient outcomes at a lower
cost. The Company's Therapeutic Service's division offers the most complete
continuum of products in the industry and helps reduce the overall cost of
patient care by allowing the health care provider to match the needs of a
particular patient with an appropriate product and therapy. In addition, the
Company continues to search for new therapies and technologies, making
investments as deemed prudent, to improve patient outcomes both now and into
the future.
The Company has also sponsored a number of medical studies which
demonstrate the clinical efficacy and cost effectiveness of its products. Over
the past several years, the Company has entered into a number of partnering
arrangements with its customers which allow its customers to obtain state of
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
the art medical technology while at the same time lowering their overall costs.
The Company believes that these types of studies and arrangements will be
necessary in order to survive and prosper in the health care industry in the
1990's.
The Company also maintains an extensive national accounts portfolio in the
specialty bed industry and expects to benefit from further consolidation of
providers and buying groups. At the same time, as shifts in reimbursement
policy have tended to move patients into lower-cost environments, the Company
has continued to focus new efforts on the extended care and home care markets.
While future performance cannot be assured, the Company believes that it is
well positioned to compete in the dynamic health care marketplace.
LEGAL PROCEEDINGS
On February 21, 1992, Novamedix Limited filed a lawsuit against the
Company in the United States District Court for the Western District of Texas.
Novamedix holds the patent rights to the principal product which directly
competes with the PlexiPulse, which is marketed by KCI New Technologies, Inc.
The suit alleges that the PlexiPulse infringes several patents held by
Novamedix, that the Company breached a confidential relationship with
Novamedix and a variety of subsidiary claims. The Plaintiff seeks injunctive
relief and monetary damages. Discovery in this case has been substantially
completed. Although it is not possible to predict the outcome of this
litigation or the damages which could be awarded, the Company believes that
its defenses to these claims are meritorious and that the litigation will not
have a material effect on the Company's financial statements.
The Company is party to several lawsuits generally incidental to its
business and is contesting adjustments proposed by the Internal Revenue Service
to prior years' tax returns. Provisions have been made in the accompanying
financial statements for estimated exposures related to these lawsuits and
adjustments. In the opinion of management, the disposition of these items
will not have a material effect on the Company's financial statements.
LIQUIDITY AND CAPITAL RESOURCES
During the first quarter of 1995, the Company generated net cash provided
by operating activities of $12.6 million compared to $16.7 million in the prior
year quarter, primarily due to additional payments of income taxes. The
Company believes that current cash reserves combined with operating cash flows
during the next twelve month period will be sufficient to provide for new
investments in equipment and any working capital needed during the period.
At March 31, 1995, cash and cash equivalents totaling $47.5 million were
available for general corporate purposes. Additionally, the Company
maintains a Credit Agreement with a bank as an agent for itself and certain
other financial institutions. The Credit Agreement currently permits borrowings
of up to $50.0 million. Please see Note 4 of Notes to Condensed Consolidated
Financial Statements. At March 31, 1995, the entire amount of the then existing
Credit Agreement was available.
At March 31, 1995, the Company did not have any material purchase
commitments.
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PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
A list of all exhibits filed or included as part of this quarterly
report on Form 10-Q is as follows:
EXHIBIT BY REFERENCE DESCRIPTION
------- ------------ -----------
10 Filed herewith Credit Agreement
dated May 8, 1995
27 Filed herewith Financial Data
Schedule
99 Filed herewith Letter from KPMG
Peat Marwick LLP dated
May 12, 1995
(b) REPORTS ON FORM 8-K
No reports on Form 8-K have been filed during the quarter for which
this report is filed.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
KINETIC CONCEPTS, INC.
(REGISTRANT)
By: JAMES R. LEININGER, M.D.
James R. Leininger, M.D.,
Chairman of the Board
By: RAYMOND R. HANNIGAN
Raymond R. Hannigan
President & Chief Executive Officer
By: BIANCA A. RHODES
Bianca A. Rhodes
Senior Vice President,
Chief Financial Officer and
Chief Accounting Officer
Date: May 12, 1995
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
------- -----------
10 Credit Agreement dated May 8, 1995
27 Financial Data Schedule
99 Letter from KPMG Peat Marwick LLP dated
May 12, 1995