UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the period ended January 31, 2002
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 0-6715
ANALOGIC CORPORATION
(Exact name of registrant as specified in its charter)
Massachusetts 04-2454372
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8 Centennial Drive, Peabody, Massachusetts 01960
(Address of principal executive offices) (Zip Code)
(978) 977-3000
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report.)
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
requirements for the past 90 days. Yes X No
The number of shares of Common Stock outstanding at February 28, 2002 was
13,199,843.
ANALOGIC CORPORATION
INDEX
Page No
-------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of
January 31, 2002 and July 31, 2001 3
Condensed Consolidated Statements of Operations for the Three
and Six Months Ended January 31, 2002 and 2001 4
Condensed Consolidated Statements of Cash Flows for the
Six Months Ended January 31, 2002 and 2001 5
Notes to Unaudited Condensed Consolidated Financial Statements 6-10
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial Condition 11-21
Item 3. Quantitative and Qualitative Disclosures about Market Risk 22
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a vote of Security Holders 23
Signatures 24
2
ITEM 1. FINANCIAL STATEMENTS
ANALOGIC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(IN THOUSANDS)
JANUARY 31, JULY 31,
2002 2001
--------- ---------
ASSETS
Current assets:
Cash and cash equivalents $ 44,095 $ 46,013
Marketable securities, at market 69,847 76,899
Accounts and notes receivable, net of allowance for doubtful
accounts $1,421 in fiscal 2002, and $1,268 in fiscal 2001 57,992 68,287
Inventories (Note 2) 59,699 60,696
Refundable and deferred income taxes 12,232 9,045
Other current assets 6,734 7,410
--------- ---------
Total current assets 250,599 268,350
Property, plant and equipment, net 73,658 68,846
Investments in and advances to affiliated companies (Note 3) 7,521 4,692
Capitalized software, net 4,007 5,488
Other assets 7,052 5,143
--------- ---------
Total assets $ 342,837 $ 352,519
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Mortgage and other notes payable $ 222 $ 369
Obligations under capital leases 297 275
Accounts payable, trade 16,583 15,378
Accrued liabilities (Note 2) 22,930 26,183
Accrued income taxes 1,090 1,646
--------- ---------
Total current liabilities 41,122 43,851
Mortgage and other notes payable 4,183 4,896
Obligations under capital leases 498 664
Advance payments and other 1,045 1,135
Deferred income taxes 2,729 1,836
--------- ---------
8,455 8,531
Commitments (Note 11)
Stockholders' equity:
Common stock, $.05 par value 705 703
Capital in excess of par value 38,781 37,857
Retained earnings 269,834 277,450
Accumulated other comprehensive income (1,710) (1,598)
Treasury stock, at cost (8,900) (9,035)
Unearned compensation (5,450) (5,240)
--------- ---------
Total stockholders' equity 293,260 300,137
--------- ---------
Total liabilities and stockholders' equity $ 342,837 $ 352,519
========= =========
The accompanying notes are an integral part of these financial statements.
3
ANALOGIC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED SIX MONTHS ENDED
JANUARY 31, JANUARY 31,
2002 2001 2002 2001
--------- --------- --------- ---------
Net revenue:
Product $ 66,397 $ 82,705 $ 131,750 $ 154,440
Engineering 4,261 6,325 11,738 12,068
Other revenue 1,952 2,638 4,924 6,757
--------- --------- --------- ---------
Total net revenue 72,610 91,668 148,412 173,265
--------- --------- --------- ---------
Costs of sales:
Product 41,268 52,421 82,819 98,992
Engineering 5,231 6,031 11,854 10,031
Other 1,266 1,496 2,721 3,232
Asset impairment charges (Note 5) 8,883
--------- --------- --------- ---------
Total cost of sales 47,765 59,948 106,277 112,255
--------- --------- --------- ---------
Gross Margin 24,845 31,720 42,135 61,010
Operating expenses:
Research and product development 10,733 9,920 21,411 19,493
Selling and marketing 8,089 7,936 16,441 15,302
General and administrative 6,827 7,665 14,776 14,993
--------- --------- --------- ---------
25,649 25,521 52,628 49,788
Income (loss) from operations: (804) 6,199 (10,493) 11,222
Other (income) expense:
Interest income, net (878) (1,455) (2,033) (2,940)
Equity in unconsolidated affiliates (631) 950 (1,369) 139
Other, net (52) 38 114 422
--------- --------- --------- ---------
(1,561) (467) (3,288) (2,379)
Income (loss) before income taxes and minority interest 757 6,666 (7,205) 13,601
Provision for income taxes (Note 10) 152 2,140 (1,440) 4,352
Minority interest 34 118
--------- --------- --------- ---------
Net income (loss) $ 605 $ 4,492 $ (5,765) $ 9,131
========= ========= ========= =========
Net income (loss) per common share: (Note 7)
Basic $ 0.05 $ 0.35 $ (0.44) $ 0.71
Diluted $ 0.05 $ 0.34 $ (0.44) $ 0.70
Weighted average shares outstanding: (Note 7)
Basic 13,071 12,906 13,073 12,892
Diluted 13,116 13,005 13,073 12,968
The accompanying notes are an integral part of these financial statements.
4
ANALOGIC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
Six Months Ended
January 31,
OPERATING ACTIVITIES: 2002 2001
-------- --------
Net Income (loss) $ (5,765) $ 9,131
Adjustments to reconcile net income (loss) to net cash provided
by operating activities:
Deferred income taxes (2,438) 700
Depreciation and amortization 8,196 7,628
Minority interest in net income of consolidated subsidiaries 118
Allowance for doubtful accounts 178 24
Impairment of assets 8,883
Loss(gain)on sale of equipment 52 (37)
Excess of equity in (gain)loss of unconsolidated affiliates (1,369) 139
Loss on investment 332
Compensation from stock grants 478 403
Net changes in operating assets and liabilities (Note 8) 5,041 (12,580)
-------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES: 13,256 5,858
-------- --------
INVESTING ACTIVITIES:
Investments in affiliated companies (7,500)
Return of investment from affiliated company 1,502
Additions to property, plant and equipment (13,387) (7,453)
Capitalized software (1,334) (1,640)
Proceeds from sale of property, plant and equipment 39 78
Maturities of marketable securities 7,475 6,455
-------- --------
NET CASH USED IN INVESTING ACTIVITIES (13,205) (2,560)
-------- --------
FINANCING ACTIVITIES:
Payments on debt and capital lease obligations (945) (602)
Issuance of common stock pursuant to stock options and
employee stock purchase plan 374 414
Dividends paid to shareholders (1,851) (1,805)
-------- --------
NET CASH USED IN FINANCING ACTIVITIES (2,422) (1,993)
-------- --------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 453 (41)
-------- --------
NET INCREASE IN CASH & CASH EQIVALENTS (1,918) (1,264)
-------- --------
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 46,013 29,132
-------- --------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 44,095 $ 30,396
======== ========
The accompanying notes are an integral part of these financial statements.
5
ANALOGIC CORPORATION
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS EXCEPT PER SHARE DATA)
1. BASIS OF PRESENTATION:
The unaudited condensed consolidated financial statements of Analogic
Corporation (the "Company") presented herein have been prepared pursuant to
the rules of the Securities and Exchange Commission for quarterly reports on
Form 10-Q and do not include all of the information and note disclosures
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, the accompanying unaudited
condensed consolidated financial statements contain all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation of the results for all periods presented. The results of the
operations for the three and six months ended January 31, 2002 are not
necessarily indicative of the results to be expected for the fiscal year
ending July 31, 2002 or any other interim period.
These statements should be read in conjunction with the consolidated
financial statements and notes thereto for the year ended July 31, 2001
included in the Company's Form 10-K as filed with the Securities and
Exchange Commission on October 26, 2001.
The financial statements have not been audited by our independent certified
public accountants. The consolidated balance sheet as of July 31, 2001
contains data derived from audited financial statements.
Certain financial statement items have been reclassified to conform to the
current year's financial presentation format.
2. BALANCE SHEET INFORMATION:
Additional information for certain balance sheet accounts is as follows for
the periods indicated:
January 31, July 31,
2002 2001
-------- --------
Inventory:
Raw materials $ 36,881 $ 35,660
Work-in-process 12,515 15,642
Finished goods 10,303 9,394
-------- --------
$ 59,699 $ 60,696
======== ========
Accrued liabilities:
Accrued employee compensation and benefits $ 9,938 $ 14,617
Accrued warranty 3,242 3,202
Deferred revenue 4,971 4,333
Customer deposit 2,248 972
Other 2,531 3,059
-------- --------
$ 22,930 $ 26,183
======== ========
6
ANALOGIC CORPORATION
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
3. INVESTMENT IN AND ADVANCES TO AFFILIATED COMPANIES:
In September 2001, the Company acquired a 19% interest in Cedara Software
Corporation of Mississauga, Ontario, Canada, in exchange for cash of $7,500
and other considerations. The Company recorded an investment of $2,469 and a
premium in excess of book value of $5,031, which was applied to intangible
assets related to acquired technologies and amortized over the estimated
useful life of five years. The Company accounts for this investment using
the equity method of accounting due to the Company's ability to exercise
influence over operating and financial policies and has two of the seven
seats on Cedara's board of directors. During the first six months of fiscal
2002, the Company recorded a gain of $227 from its share of profit in
Cedara, with a carrying value of this investment at January 31, 2002 of
$2,696. The company also recognized amortization of the intangible asset of
$336 during the first six months of fiscal 2002, with a carrying value of
the intangible asset at January 31, 2002 of $4,695 which is classified as
Other Assets on the Condensed Consolidated Balance Sheets.
The Company has guaranteed the debt owed by Cedara to its bank lender
through the provision of a credit facility with Analogic's principal bank
for approximately $6.3 million.
Cedara is a premier independent provider of imaging software technology and
custom imaging software development to leading Original Equipment
Manufacturers (OEMs) in the healthcare industry. Cedara enables healthcare
solution providers to integrate better imaging software into their systems
and hardware in such fields as Computed Tomography (CT) and Magnetic
Resonance Imaging (MRI).
4. DIVIDENDS:
The Company declared dividends of $.07 per common share on March 16, 2002,
payable April 15, 2002 to shareholders of record on April 1, 2002. The
Company declared dividends of $.07 per common share on December 11, 2001,
payable January 10, 2002 to shareholders of record on December 26, 2001. The
Company declared dividends of $.07 per common share on October 11, 2001,
payable November 8, 2001 to shareholders of record on October 25, 2001.
5. ASSET IMPAIRMENT CHARGES:
During the quarter ending October 31, 2001, Analogic recorded asset
impairment charges totaling $8,883 on a pre-tax basis.
As a result of the continued decline in the economic and business conditions
in the telecommunications industry, Analogic decided to terminate activities
related to Anatel, the Company's wholly-owned telecommunications subsidiary.
The Company recorded a pre-tax charge of $1,901 related to the impairment of
purchased intangibles and other long-lived assets. The impairment charge is
equal to the amount by which the assets' carrying value exceeded the present
value of their estimated discounted cash flows. Additionally, a pre-tax
charge of $557 related to obsolete inventory, as well as a pre-tax charge of
$1,120 related to capitalized software, has been recorded as those assets
have been deemed to be unrecoverable. The Company also recorded a pretax
asset impairment charge of $3,200 in fiscal 2001 primarily for inventory and
capitalized software related to Anatel.
The Company decided to discontinue the sales of certain of its older and
nonprofitable product lines within its semi-conductor test equipment
business, in order to focus its resources on the highest potential
7
ANALOGIC CORPORATION
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
growth areas within this business. As a result, the Company recorded a
pre-tax charge of $902 related to the impairment of purchased intangibles
and other long-lived assets. The impairment charge is equal to the amount by
which the assets' carrying value exceeded the present value of their
estimated discounted cash flows. Additionally, a pre-tax charge of $3,600
related to excess and obsolete test equipment inventory, as well as a
pre-tax charge of $803 related to capitalized software, has been recorded as
those assets have been deemed to be unrecoverable. The Company also incurred
immaterial costs related to involuntary terminations and other related
activities. The entire balance of each charge has been recorded within the
Cost of Sales section of the Company's Condensed consolidated Statements of
Operations.
The inventory reserve established in fiscal year 2001 and in the first
quarter of fiscal year 2002 as part of the asset impairment charges totaled
$5,657. A total of $659 of excess and obsolete inventory was scrapped and
charged to the reserve during the quarter ended January 31, 2002.
6. COMPREHENSIVE INCOME (LOSS):
The following table presents the calculation of total comprehensive income
(loss) and its components:
Three Months Ended Six Months Ended
January 31, January 31,
2002 2001 2002 2001
-------- -------- -------- --------
Net income (loss) $ 605 $ 4,492 $ (5,765) $ 9,131
Other comprehensive income (loss) net of tax:
Unrealized gains and losses from
marketable securities of $62 and $597
for the three months ended January 31, 2002
and 2001, and $167 and $680 for the six
months ended January 31, 2002 and 2001, (94) 913 256 1,039
Foreign currency translation adjustment, net of
taxes of $279 and $485 for the three months
ended January 31, 2002 and 2001, and $240
and $89 for the six months ended January 31,
2002 and 2001 (427) 735 (368) (141)
-------- -------- -------- --------
Total comprehensive income (loss) $ 84 $ 6,140 $ (5,877) $ 10,029
======== ======== ======== ========
8
ANALOGIC CORPORATION
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
7. NET INCOME (LOSS) PER SHARE:
The following table sets forth the computation of basic and diluted earnings
per share:
Three Months Ended Six Months Ended
January 31, January 31,
2002 2001 2002 2001
-------- -------- -------- --------
Net income (loss) $ 605 $ 4,492 $ (5,765) $ 9,131
======== ======== ======== ========
Basic:
Weighted average number
of common shares outstanding 13,071 12,906 13,073 12,892
======== ======== ======== ========
Net income(loss) per share $ 0.05 $ 0.35 $ (0.44) $ 0.71
======== ======== ======== ========
Diluted:
Weighted average number
of common share outstanding 13,071 12,906 13,073 12,892
Dilutive effect of stock options 45 99 76
-------- -------- -------- --------
Total 13,116 13,005 13,073 12,968
======== ======== ======== ========
Net income(loss) per share $ 0.05 $ 0.34 $ (0.44) $ 0.70
======== ======== ======== ========
For the three months ended January 31, 2002, 367 options to acquire shares
of common stock have been excluded from the calculation of diluted earnings
per share because the options' price was greater than the average market
price of the common shares. For the six months ended January 31, 2002, 802
options to acquire shares of common stock and 147 shares of unvested
restricted common stock have been excluded from the calculation of diluted
earnings per share, as their inclusion would have been antidilutive.
For the three and six months ended January 31, 2001, 133 and 198 options to
acquire shares of common stock, respectively, have been excluded from the
calculation of diluted earnings per share because the options' price was
greater than the average market price of the common shares.
8. SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Changes in operating assets and liabilities are as follows:
Six Months Ended
January 31,
2002 2001
-------- --------
Accounts and notes receivable $ 10,274 $ 195
Inventories (3,394) (10,331)
Other current assets 152 (284)
Other assets 291 (612)
Accounts payable trade 1,307 (1,757)
Accrued expenses and other current liabilities (3,041) 1,930
Accrued income taxes (548) (1,721)
-------- --------
Net changes in operating assets and liabilities $ 5,041 $(12,580)
======== ========
9
ANALOGIC CORPORATION
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
9. SEGMENT INFORMATION:
The Company's operations are primarily within a single segment within the
electronics industry (Medical Instrumentation Technology Products). These
operations encompass the design, manufacture and sale of high technology,
high-performance, high precision data acquisition, conversion
(analog/digital) and signal processing instruments and systems to customers
that both manufacture and market products for medical and industrial use.
The other segment represents the Company's hotel operation and other
Company's operations which do not meet the materiality requirements for
separate disclosure. The table below presents information about the
Company's reportable segments:
Three Months Ended Six Months Ended
January 31, January 31,
2002 2001 2002 2001
--------- --------- --------- ---------
Revenues:
Medical instrumentation technology products $ 65,334 $ 82,735 $ 131,740 $ 155,479
Other 7,276 8,933 16,672 17,786
--------- --------- --------- ---------
Total $ 72,610 $ 91,668 $ 148,412 $ 173,265
--------- --------- --------- ---------
Income(loss) before income taxes and minority
interest:
Medical instrumentation technology product $ 289 $ 4,833 $ (9,481) $ 9,157
Other 468 1,833 2,276 4,444
--------- --------- --------- ---------
Total $ 757 $ 6,666 $ (7,205) $ 13,601
--------- --------- --------- ---------
January 31, 2002 July 31, 2001
Identifiable assets:
Medical instrumentation technology product $226,863 $237,642
Other 115,974 114,877
------- -------
Total $342,837 $352,519
-------- --------
10. TAXES:
The effective tax rate for the three and six months ended January 31, 2002
was 20% as compared to 32% for the same period last year. This decrease in
the rate was due to the increase in the tax benefit of tax exempt interest
and the extraterritorial income exclusion.
11. COMMITMENTS:
The Company's Danish subsidiary B-K Medical A/S announced in May 2001 the
construction of a new 135,000 square foot facility in Herlev, north of
Copenhagen, for the manufacturing of specialized diagnostic ultrasound
equipment at an estimated cost of $15.5 million which will be funded
internally. The new facility, due for completion in May 2002, will host
manufacturing, R&D, service, marketing, sales and administrative functions.
The Company has guaranteed the debt owed by Cedara to its bank lender
through the provision of a credit facility with Analogic's principal bank
for approximately $6.3 million.
10
ANALOGIC CORPORATION
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION.
The following discussion provides an analysis of Analogic Corporation's
financial condition and results of operations. The discussion below contains
forward looking statements within the meaning of the Securities Act of 1933 and
the Securities Exchange Act of 1934. Such forward looking statements involve
known and unknown risks, uncertainties, and other factors, which may cause the
actual results, performance, or achievements of Analogic Corporation to differ
from the projected results. Such factors are discussed in greater detail on page
18. All statements other than statements of historical fact the Company makes in
this document or in any document incorporated by reference are forward looking.
CRITICAL ACCOUNTING POLICIES
Our significant accounting policies are more fully described in Note 1 of the
Company's Form 10K for the year ended July 31, 2001 as filed with the Securities
and Exchange Commission on October 26, 2001. Certain of our accounting policies
require the application of significant judgment by management in selecting the
appropriate assumptions for calculating financial estimates. By their nature,
these judgments are subject to an inherent degree of uncertainty. These
judgments are based on our historical experience, terms of existing contracts,
our observance of trends in the industry, information provided by our customers
and information available from other outside sources, as appropriate. Our
critical accounting policies include:
Revenue Recognition
Revenue related to product sales is recognized upon shipment provided that title
and risk of loss has passed to the customer, there is persuasive evidence of an
arrangement, the sales price is fixed or determinable, collection of the related
receivable is reasonably assured and customer acceptance criteria, if any, have
been successfully demonstrated. For product sales with acceptance criteria that
are not successfully demonstrated prior to shipment, revenue is recognized upon
customer acceptance. Service revenues are recognized at the time the services
are rendered and the company has no significant further obligations to the
customer. The Company provides engineering services to some of its customers on
a contractual basis and recognizes revenue using the percentage of completion
method. License revenue, based on contractual agreements reached with customers,
is recognized over the term of the license. Revenue related to the hotel
operations are recognized as services are performed.
Inventories
The Company values inventory at the lower of cost or market using the first-in,
first-out (FIFO) method. Management assesses the recoverability of inventory
based on types and levels of inventory held, forecasted demand and changes in
technology. These assessments require management judgments and estimates, and
valuation adjustments for excess and obsolete inventory may be recorded based on
these assessments. Estimates of future product demand or judgments related to
changes in technology may prove to be inaccurate, in which case the carrying
value of inventory could be overstated or understated. In the event of any such
inaccuracies, an adjustment would be recognized in cost of goods sold at the
time of such determination.
11
ANALOGIC CORPORATION
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of
credit risk consist principally of cash and cash equivalents, marketable
securities and accounts receivable. The Company places its cash investments and
marketable securities in high credit quality financial instruments and by
policy, limits the amount of credit exposure to any one financial institution.
The Company grants credit to domestic and foreign original equipment
manufacturers, distributors and end users, performs ongoing credit evaluations
and adjust credit limits based upon payment history and the customer's current
credit worthiness. The Company continuously monitors collections and payments
from our customers and maintains a provision for estimated credit losses based
upon historical experience and any specific customer collections issues that
have been identified. While such credit losses have historically been within
expectations and provisions established, there is no guarantee that the Company
will continue to experience the same credit loss rates as in the past. Since the
accounts receivable are concentrated in a relatively few number of customers, a
significant change in liquidity or financial position of any one of these
customers could have a material adverse impact on the collectability of accounts
receivables and future operating results.
Investments in and Advances to Affiliated Companies
The Company has several investments in affiliated companies related to areas of
the Company's strategic focus. The Company accounts for these investments using
the equity method of accounting. In assessing the recoverability of these
investments, the Company must make certain assumptions and judgments based on
changes in the Company's overall business strategy, the financial condition of
the affiliated companies, market conditions and the industry and economic
environment in which the entity operates. Adverse changes in market conditions
or poor operating results of affiliated companies could result in losses or an
inability to recover the carrying value of the investments, thereby requiring an
impairment charge in the future.
Intangible and Other Long-lived Assets
The Company has intangible and other long-lived assets primarily related to
technology, licenses, capitalized software and property, plant and equipment. In
assessing the recoverability of these assets, the Company must make assumptions
regarding estimated future cash flows, the expected period in which the asset is
to be utilized, changes in technology and customer demand. If these estimates or
their related assumptions change in the future, the Company may be required to
record impairment charges for these assets not previously recorded.
12
ANALOGIC CORPORATION
RESULTS OF OPERATIONS
SIX MONTHS FISCAL 2002 (01/31/02) VS. SIX MONTHS FISCAL 2001 (01/31/01)
Product revenue for the six months ended January 31, 2002 was $131,750 as
compared to $154,440 for the same period last year, a decrease of 15%. The
decrease in revenue of $22,690 was primarily due to a decrease of sales volume
in Industrial Technology Products of $18,283, or 88%, due to a severe decline in
its semi-conductor Automatic Test Equipment (ATE) boards and a decrease of sales
in Signal Processing Technology Products of $4,063, or 20%, due to the collapse
of the Internet Telephony market.
Engineering revenue for the six months ended January 31, 2002 was $11,738
compared to $12,068 for the same period last year, a decrease of 3%. The change
was primarily due to the decrease in the Company's customers' demand for these
services.
Other revenues of $4,924 and $6,757 represent revenue from the Hotel operation
for the six months ending January 31, 2002 and 2001, respectively. The decrease
in revenues is mostly attributable to the current economic decline in the travel
and lodging industries.
Cost of product sales was $82,819 and $98,992 for the six months ending January
31, 2002 and 2001, respectively. Cost of product sales as a percentage of
product revenue was 63% for the six months ending January 31, 2002 compared to
64% for the same period last year. This percentage decrease was primarily due to
changes in product mix.
Engineering cost of sales was $11,854 for the six months ending January 31, 2002
compared to $10,031 for the same period last year. The total cost of engineering
sales as a percentage of engineering revenue increased to 101% for the six
months ending January 31, 2002 from 83% for the six months ending January 31,
2001. The increase was primarily attributable to the unanticipated costs
associated with the development of leading edge, high precision health and
security imaging systems.
Other costs of sales were $2,721 and $3,232 from the Company's Hotel operation
for the six months ending January 31, 2002 and 2001, respectively.
During the six months ending January 31, 2002, the Company has recorded asset
impairment charges totaling $8,883 on a pre-tax basis.
As a result of the continued decline in the economic and business conditions in
the telecommunications industry, Analogic decided to terminate activities
related to Anatel, the Company's wholly-owned telecommunications subsidiary. The
Company recorded a pre-tax charge of $1,901 related to the impairment of
purchased intangibles and other long-lived assets. The impairment charge is
equal to the amount by which the assets' carrying value exceeded the present
value of their estimated discounted cash flows. Additionally, a pre-tax charge
of $557 related to obsolete inventory, as well as a pre-tax charge of $1,120
related to capitalized software, has been recorded as those assets have been
deemed to be unrecoverable. The Company also recorded a pretax asset impairment
charge of $3,200 in fiscal 2001 primarily for inventory and capitalized software
related to Anatel.
The Company decided to discontinue the sales of certain of its older and
nonprofitable product lines within its semi-conductor test equipment business,
in order to focus its resources on the highest potential growth areas within
this business. As a result, the Company recorded a pre-tax charge of $902
related to the impairment of purchased intangibles and other long-lived assets.
The impairment charge is
13
ANALOGIC CORPORATION
equal to the amount by which the assets' carrying value exceeded the present
value of their estimated discounted cash flows. Additionally, a pre-tax charge
of $3,600 related to excess and obsolete test equipment inventory, as well as a
pre-tax charge of $803 related to capitalized software, has been recorded as
those assets have been deemed to be unrecoverable. The Company also incurred
immaterial costs related to involuntary terminations and other related
activities. The entire balance of each charge has been recorded within the Cost
of Sales section of the Company's Condensed Consolidated Statements of
Operations.
The inventory reserve established in fiscal year 2001 and in the first quarter
of fiscal year 2002 as part of the asset impairment charges totaled $5,657. A
total of $659 of excess and obsolete inventory was scrapped and charged to the
reserve during the quarter ended January 31, 2002.
Research and Development expenses were $21,411 for the six months of fiscal
2002, or 14% of total revenue, as compared to $19,493 for the same period of the
prior year, or 11% of total revenue. The increase of $1,918 or 10%, was due to
research and development activities associated with the Vericis system interface
database and continued development of medical and explosive detection system
(EDS) products.
Selling and marketing expenses were $16,441 for the six months of fiscal 2002,
or 11% of total revenue, as compared to $15,302, or 9% of total revenue for the
same period last year. The increase of $1,139 was primarily due to the Company's
subsidiaries, Camtronics and B-K Medical, as they continue to expand their
activities in the end user market.
General and administrative expenses were $14,776, or 10% of total revenue, for
the six months ending January 31, 2002, as compared to $14,993, or 9% of total
revenue, for the same period last year. The decrease of $217 was primarily due
to a general cost reduction and containment program that had been put in place
across the Company.
Interest income net of interest expense was $2,033 for the first six months of
fiscal 2002, as compared with $2,940 for the same period last year. The decrease
of $907 was primarily the result of lower interest rates on short term
investments.
During the first six months of fiscal 2002, the Company recorded a gain of
$1,369 related to equity in unconsolidated affiliates, as compared primarily of
$333 reflecting the Company's share of profit in Shenzhen Anke High-Tech Co.,
Ltd. (SAHCO) for the first six months of fiscal 2002, versus a loss of $936 for
the same period last year and a gain of $825 from its share of profit in
Enhanced CT
Technology LLC for the first six months of fiscal 2002, compared to a gain of
$720 for the same period last year; and a gain of $227 from its share of profit
in Cedara Software Corporation, in which the Company acquired a 19% interest in
September 2001.
Other expenses were $114 for the first six months of fiscal 2002 as compared to
$422 for the same period last year. The decrease was primarily due to an other
than temporary impairment on an investment of restricted securities of
approximately $332 recorded in the first six months of fiscal 2001, versus none
in fiscal 2002.
The effective tax rate for the first six months of fiscal 2002 was 20% as
compared to 32% for the same period last year. This decrease in the rate was due
to the increase in the tax benefit for tax exempt interest and the
extraterritorial income exclusion.
14
ANALOGIC CORPORATION
Net loss for the six months ended January 31, 2002 was $5,765 or $0.44 per basic
and diluted share as compared with net income of $9,131 or $0.71 per basic share
and $0.70 per diluted share. The net loss for the six months of fiscal 2002
includes an asset impairment charge of $8,883 related to the Company's
telecommunications subsidiary, Anatel, and certain assets of the Company's Test
and Measurement Division. Excluding the asset impairment charges, net income
would have been approximately $1,341 or $0.10 per basic and diluted earnings for
the six months ended January 31, 2002. The decrease in net income over the prior
year, excluding the asset impairment charge, was primarily the result of
decreased revenue in the semi-conductor industry, a reduction in revenue in the
Company's Hotel operation due to the current economic decline in the travel and
lodging industries, and engineering expenditures for projects developing imaging
and security detection equipment.
RESULTS OF OPERATIONS
SECOND QUARTER FISCAL 2002 (01/31/02) VS. SECOND QUARTER FISCAL 2001 (01/31/01)
Product revenue for the three months ended January 31, 2002 was $66,397 as
compared to $82,705 for the same period last year, a decrease of 20%. The
decrease in revenue of $16,308 was due to a decrease in sales of Medical
Technology Products of $2,970, or 4%, due to lower sales of digital radiography
systems partially offset by higher demand for ultrasound and cardiovascular
systems; a decrease in sales of Industrial Technology Products of $10,506, or
90%, due to the decline in its semi-conductor Automatic Test Equipment (ATE)
boards; a decrease in sales of Signal Processing Technology Products of $2,832,
or 30%, due to lower demand for embedded multiprocessing equipment and hybrid
component boards.
Engineering revenue for the three months ended January 31, 2002 was $4,261
compared to $6,325 for the same period last year, a decrease of 33%. The change
was primarily due to the decrease in the Company's customers' demand for these
services.
Other revenues of $1,952 and $2,638 represent revenue from the Hotel operation
for the three months ending January 31, 2002 and 2001, respectively. The
decrease in revenues is due to the current economic decline in the travel and
lodging industries.
Cost of product sales was $41,268 and $52,421 for the three months ending
January 31, 2002 and 2001, respectively. Cost of product sales as a percentage
of product revenue was 62% for the three months ending January 31, 2002 compared
to 63% for the same period last year. The decrease was primarily due to changes
in product mix.
Engineering cost of sales was $5,231 for the three months ending January 31,
2002 compared to $6,031 for the same period last year. The total cost of
engineering sales as a percentage of engineering revenue increased to 123% for
the three months ended January 31, 2002 from 95% for the three months ending
January 31, 2001. This percentage increase was primarily attributable to the
unanticipated costs associated with the development of leading edge, high
precision health and security imaging systems.
Other costs of sales were $1,266 and $1,496 from the Company's Hotel operation
for the three months ending January 31, 2002 and 2001, respectively.
Research and Development expenses were $10,733 for the three months of fiscal
2002, or 15% of total revenue, as compared to $9,920 for the same period of
prior year, or 11% of total revenue. The increase of $813 or 8%, was due to
research and development activities associated with the Vericis system
15
ANALOGIC CORPORATION
interface database and continued development of medical and explosive detection
system (EDS) products.
Selling and marketing expenses were $8,089 for the three months of fiscal 2002,
or 11% of total revenue, as compared to $7,936, or 9% of total revenue for the
same period last year. The increase of $153 was primarily due to the higher
expenses for the Company's subsidiaries, Camtronics and B-K Medical, partially
offset by cost reduction efforts in other businesses.
General and administrative expenses were $6,827, or 9% of total revenue, for the
three months ending January 31, 2002, as compared to $7,665, or 8% of total
revenue, for the same period last year. The decrease of $838 was primarily due
to general cost reduction and containment program that had been put in place
across the Company.
Interest income net of interest expense was $878 for the first three months of
fiscal 2002, as compared with $1,455 for the same period last year. The decrease
of $577 was primarily the result of lower interest rates on short term
investments.
During the second quarter of fiscal 2002, the Company recorded a gain of $631
related to equity in unconsolidated affiliates, as compared to a loss of $950
for the same period last year. This gain consist primarily of $418 from its
share of profit in Enhanced CT Technology LLC for the second quarter of fiscal
2002, compared to a gain of $403 for the same period last year; a gain of $2
reflecting the Company's share of profit in SAHCO for the second quarter of
fiscal 2002, versus a loss of $1,350 for the same period last year; and a gain
of $227 from its share of profit in Cedara Software Corporation in which the
Company acquired a 19% interest in September 2001.
The effective tax rate for the second quarter of fiscal 2002 was 20% as compared
to 32% for the same period last year. This decrease in the rate was due to the
increase in the tax benefit for tax exempt interest and the extraterritorial
income exclusion.
Net income for the second quarter ended January 31, 2002 was $605 or $0.05 per
basic and diluted share as compared with net income of $4,492 or $0.35 per basic
share and $0.34 per diluted share for the same period last year. The decrease in
net income over the prior year was primarily the result of decreased revenue in
the semi-conductor industry, and an increase in engineering expenditures.
16
ANALOGIC CORPORATION
LIQUIDITY AND CAPITAL RESOURCES
Cash generated by operations in the first six months of fiscal 2002 was $13,256
compared to $5,858 during the same period of the prior year. Although the
company generated a net loss of $5,765 for the first six months of fiscal 2002,
when the asset impairment charge of $8,883 and other recurring non-cash
adjustments are added back to the net loss, operating cash was generated
primarily due to a decrease in working capital balances. Net cash used in
investment activities was $13,205 in the six months of fiscal 2002, primarily
due to the Company's investment in Cedara of $7,500, and $13,387 used for
additions to property, plant and equipment, partially offset by $1,502 return on
investment from an affiliated company. The increase in property, plant and
equipment was primarily for the construction of a new facility by the Company's
Danish subsidiary, B-K Medical. Net cash used from financing activities of
$2,422 was mostly due to dividends paid to shareholders and payment of debt.
The Company's balance sheet reflects a current ratio of 6.1 to 1 at January 31,
2002 and at July 31, 2001. Liquidity is sustained principally through funds
provided from operations, with short term time deposits and marketable
securities available to provide additional sources of cash. The Company places
its cash investments in high credit quality financial instruments and, by
policy, limits the amount of credit exposure to any one financial institution.
The Company's debt to equity ratio was .17 to 1 at January 31, 2002 and at July
31, 2001. Management does not anticipate any difficulties in financing
operations at anticipated levels for the foreseeable future.
The Company recently received a $20 million revolving line of credit from its
principal bank. Of this amount a $6.3 million letter of credit was used to
guarantee a debt owed by Cedara to its bank lender.
The carrying amounts reflected in the consolidated balance sheets of cash and
cash equivalents, trade receivables, and trade payables approximate fair value
at January 31, 2002 due to the short maturities of these instruments.
The Company maintains a bond investment portfolio of various issuers, types, and
maturities. The Company's cash and investments include cash equivalents, which
the Company considers to be investments purchased with original maturities of
three months or less. Investments having original maturities in excess of three
months are stated at amortized cost, which approximates fair value, and are
classified as available for sale. A rise in interest rates could have an adverse
impact on the fair value of the Company's investment portfolio. The Company does
not currently hedge these interest rate exposures.
Accounts and notes receivable decreased by $10,295 during the six months ended
January 31, 2002, primarily due to a decrease in revenue.
Inventory increased $3,160, before the asset impairment charges of $4,157,
during the six months ended January 31, 2002 primarily due to an increase in raw
material purchases.
17
ANALOGIC CORPORATION
FORWARD LOOKING STATEMENTS
This report on Form 10-Q contains statements which, to the extent that they are
not recitation of historical facts, constitute "forward looking statements"
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that all forward looking statements,
including statements about product development, market and industry trends,
strategic initiatives, regulatory approvals, sales, profits, expenses, price
trends, research and development expenses and trends, and capital expenditures
involve risk and uncertainties and actual events and results may differ
significantly from those indicated in any forward looking statements.
RISK FACTORS
YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW BEFORE MAKING AN
INVESTMENT DECISION. ADDITIONAL RISKS NOT PRESENTLY KNOWN TO US OR THAT WE
CURRENTLY DEEM IMMATERIAL MAY ALSO IMPAIR OUR BUSINESS. ANY OF THESE RISKS COULD
HAVE A MATERIAL AND NEGATIVE EFFECT ON OUR BUSINESS, FINANCIAL CONDITION OR
RESULTS OF OPERATIONS.
BECAUSE A SIGNIFICANT PORTION OF OUR REVENUE CURRENTLY COMES FROM A SMALL NUMBER
OF CUSTOMERS, ANY DECREASE IN REVENUE FROM THESE CUSTOMERS COULD HARM OUR
OPERATING RESULTS.
We depend on a small number of customers for a large portion of our business,
and changes in our customers' orders may have a significant impact on our
operating results. If a major customer were to significantly reduce the amount
of business it does with us, there would be an adverse impact on our operating
results.
The following table sets forth the percentages of our total net sales of our
three largest customers in the last three fiscal years and the percentage of our
total net sales to our ten largest customers in those years:
Year Ended July 31,
2001 2000 1999
---- ---- ----
Philips................................................... 22% 16% 18%
General Electric.......................................... 11% 10% 8%
Toshiba .................................................. 7% 9% 9%
Ten largest customers as a group 62% 60% 60%
Although we are seeking to broaden our customer base, we will continue to depend
on sales to a relatively small number of major customers. Because it often takes
significant time to replace lost business, it is likely that our operating
results would be adversely affected if one or more of our major customers were
to cancel, delay or reduce significant orders in the future. Our customer
agreements typically permit the customer to discontinue future purchases after
timely notice. In addition, we generate significant accounts receivable in
connection with the products we sell and the services we provide to our major
customers. Although our major customers are large corporations, if one or more
of our customers were to become insolvent or otherwise be unable to pay for our
services, our operating results and financial condition could be adversely
affected.
18
ANALOGIC CORPORATION
COMPETITION FROM EXISTING OR NEW COMPANIES IN THE MEDICAL INSTRUMENTATION
TECHNOLOGY INDUSTRY COULD CAUSE US TO EXPERIENCE DOWNWARD PRESSURE ON PRICES,
FEWER CUSTOMER ORDERS, REDUCED MARGINS, THE INABILITY TO TAKE ADVANTAGE OF NEW
BUSINESS OPPORTUNITIES AND THE LOSS OF MARKET SHARE.
We operate in a highly competitive industry. We are subject to competition based
upon product design, performance, pricing, quality and services and we believe
our innovative engineering and product reliability have been important factors
in our growth. While we try to maintain competitive pricing on those products
which are directly comparable to products manufactured by others, in many
instances our products will conform to more exacting specifications and carry a
higher price than analogous products manufactured by others.
Our competitors include divisions of some larger, more diversified organizations
as well as several specialized companies.
Some of them have greater resources and larger staffs than we have.
Many of our OEM customers and potential OEM customers have the capacity to
design and manufacture the products we manufacture for themselves. We face
competition from research and product development groups and the manufacturing
operations of our current and potential customers, who continually evaluate the
benefits of internal research and product development and manufacturing versus
outsourcing.
WE DEPEND ON OUR SUPPLIERS, SOME OF WHICH ARE THE SOLE SOURCE FOR OUR
COMPONENTS, AND OUR PRODUCTION WOULD BE SUBSTANTIALLY CURTAILED IF THESE
SUPPLIERS ARE NOT ABLE TO MEET OUR DEMANDS AND ALTERNATIVE SOURCES ARE NOT
AVAILABLE.
We order raw materials and components to complete our customers' orders, and
some of these raw materials and components are ordered from sole-source
suppliers. Although we work with our customers and suppliers to minimize the
impact of shortages in raw materials and components, we sometimes experience
short-term adverse effects due to price fluctuations and delayed shipments. In
the past, there have been industry-wide shortages of electronics components. If
a significant shortage of raw materials or components were to occur, we may have
to delay shipments or pay premium pricing, which would adversely affect our
operating results. In some cases, supply shortages of particular components will
substantially curtail production of products using these components. We are not
always able to pass on price increases to our customers. Accordingly, some raw
material and component price increases could adversely affect our operating
results. We also depend on a small number of suppliers, some of whom are
affiliated with customers or competitors and others of whom may be small, poorly
financed companies, for many of the other raw materials and components that we
use in our business. If we are unable to continue to purchase these raw
materials and components from our suppliers, our operating results would be
adversely affected. Because many of our costs are fixed, our margins depend on
our volume of output at our facilities and a reduction in volume will adversely
affect our margins.
IF WE ARE LEFT WITH EXCESS INVENTORY, OUR OPERATING RESULTS WILL BE ADVERSELY
AFFECTED.
Because of long-lead times and specialized product designs, we typically
purchase components and manufacture products for customer orders or in
anticipation of customer orders based on customer forecasts. For a variety of
reasons, such as decreased end-user demand for the products we are
manufacturing, our customers may not purchase all of the products we have
manufactured or for which
19
ANALOGIC CORPORATION
we have purchased components. In either event, we would attempt to recoup our
materials and manufacturing costs by means such as returning components to our
vendors, disposing of excess inventory through other channels or requiring our
OEM customers to purchase or otherwise compensate us for such excess inventory.
Some of our significant customer agreements do not give us the ability to
require our OEM customers to do this. To the extent we are unsuccessful in
recouping our material and manufacturing costs, not only would our net sales be
adversely affected, but also our operating results would be disproportionately
adversely affected. Moreover, carrying excess inventory would reduce the working
capital we have available to continue to operate and grow our business.
UNCERTAINTIES AND ADVERSE TRENDS AFFECTING OUR INDUSTRY OR ANY OF OUR MAJOR
CUSTOMERS MAY ADVERSELY AFFECT OUR OPERATING RESULTS.
Our business depends primarily on a specific segment of the electronics
industry, medical instrumentation technology products, which is subject to rapid
technological change and pricing and margin pressure. This industry has
historically been cyclical and subject to significant downturns characterized by
diminished product demand, rapid declines in average selling prices and
production over-capacity. In addition, changes in government policy relating to
reimbursement for the purchase and use of medical capital equipment could also
affect our sales. Our customers' markets are also subject to economic cycles and
are likely to experience recessionary periods in the future. The economic
conditions affecting our industry, in general, or any of our major customers, in
particular, may adversely affect our operating results. Our businesses outside
the medical instrumentation technology product sector are subject to the same or
greater technological and cyclical pressures.
OUR CUSTOMERS' DELAY OR INABILITY TO OBTAIN ANY NECESSARY UNITED STATES OR
FOREIGN REGULATORY CLEARANCES OR APPROVALS FOR THEIR PRODUCTS COULD HAVE A
MATERIAL ADVERSE EFFECT ON OUR BUSINESS.
Our products are used by a number of our customers in the production of medical
devices that are the subject of a high level of regulatory oversight. A delay or
inability to obtain any necessary United States or foreign regulatory clearances
or approvals for products could have a material adverse effect on our business.
The process of obtaining clearances and approvals can be costly and
time-consuming. There is a further risk that any approvals or clearances, once
obtained, may be withdrawn or modified. Medical devices cannot be marketed in
the United States without clearance or approval by the FDA. Medical devices sold
in the United States must also be manufactured in compliance with FDA Good
Manufacturing Practices, which regulate the design, manufacture, packing,
storage and installation of medical devices. Moreover, medical devices are
required to comply with FDA regulations relating to investigational research and
labeling. States may also regulate the manufacture, sale and use of medical
devices. Medical device products are also subject to approval and regulation by
foreign regulatory and safety agencies.
OUR ANNUAL AND QUARTERLY OPERATING RESULTS ARE SUBJECT TO FLUCTUATIONS, WHICH
COULD AFFECT THE MARKET PRICE OF OUR COMMON STOCK.
Our annual and quarterly results may vary significantly depending on various
factors, many of which are beyond our control, and may not meet the expectations
of securities analysts or investors. If this were to occur, the price of our
Common Stock would likely decline.
20
ANALOGIC CORPORATION
These factors include:
- variations in the timing and volume of customer orders relative to
our manufacturing capacity;
- introduction and market acceptance of our customers' new products;
- changes in demand for our customers' existing products;
- the timing of our expenditures in anticipation of future orders;
- effectiveness in managing our manufacturing processes;
- changes in competitive and economic conditions generally or in our
customers' markets;
- changes in the cost or availability of components or skilled labor;
and
- foreign currency exposure.
As is the case with many technology companies, we typically ship a significant
portion of our products in the last month of a quarter. As a result, any delay
in anticipated sales is likely to result in the deferral of the associated
revenue beyond the end of a particular quarter, which would have a significant
effect on our operating results for that quarter. In addition, most of our
operating expenses do not vary directly with net sales and are difficult to
adjust in the short term. As a result, if net sales for a particular quarter
were below our expectations, we could not proportionately reduce operating
expenses for that quarter, and, therefore, that revenue shortfall would have a
disproportionately adverse effect on our operating results for that quarter.
LOSS OF ANY OF OUR KEY PERSONNEL COULD HURT OUR BUSINESS BECAUSE OF THEIR
INDUSTRY EXPERIENCE AND THEIR TECHNOLOGICAL EXPERTISE.
We operate in a highly competitive industry and depend on the services of our
key senior executives and our technological experts. The loss of the services of
one or several of our key employees or an inability to attract, train and retain
qualified and skilled employees, specifically engineering and operations a
personnel, could result in the loss of customers or otherwise inhibit our
ability to operate and grow our business successfully.
IF WE ARE UNABLE TO MAINTAIN OUR TECHNOLOGICAL EXPERTISE IN RESEARCH AND PRODUCT
DEVELOPMENT AND MANUFACTURING PROCESSES WE WILL NOT BE ABLE TO SUCCESSFULLY
COMPETE.
We believe that our future success will depend upon our ability to provide
research and product development and manufacturing services that meet the
changing needs of our customers. This requires that we successfully anticipate
and respond to technological changes in design and manufacturing processes in a
cost-effective and timely manner. As a result, we continually evaluate the
advantages and feasibility of new product design and manufacturing processes. We
cannot, however, assure you that our development efforts will be successful.
21
ANALOGIC CORPORATION
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company faces limited exposure to financial market risks, including adverse
movements in foreign currency exchange rates and changes in interest rates.
These exposures may change over time as business practices evolve and could have
a material adverse impact on the Company's financial results. The Company's
primary exposure has been related to local currency revenue and operating
expenses in Europe.
22
ANALOGIC CORPORATION
PART II - OTHER INFORMATION
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Company's Annual Meeting of stockholders held on January 18, 2002, the
following proposals were adopted by the vote specified below:
Withheld Authority
To Vote
Proposal For For All Nominees
- -------- --- ----------------
1. Election of Directors
M. Ross Brown 11,891,613 393,162
Edward F. Vobril 12,124,981 159,794
Michael T. Modic 12,122,842 161,933
For Against Abstain
---------- --------- -------
2. Ratification of Independent Auditors 12,243,407 33,368 8,000
3. To amend the Company's 1998
Key Employee Stock Option Plan 10,384,727 1,699,313 200,735
Please see the Company's Proxy Statement filed with the Securities and Exchange
Commission in connection with this Annual Meeting for a description of the
matters voted upon.
23
ANALOGIC CORPORATION
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.
ANALOGIC CORPORATION
Registrant
DATE: March 18, 2002 /s/ Bernard Gordon
--------------------------------
Bernard Gordon
Chairman of the Board of
Directors and Executive Chairman
DATE: March 18, 2002 /s/ John J. Millerick
--------------------------------
John J. Millerick
Senior Vice President,
Chief Financial Officer and
Treasurer (Principal Financial
and Accounting Officer)
24