U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
[ X ] QUARTERLY REPORT UNDER SECTION 13 or 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: September 30, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 or 15 (d)
OF THE EXCHANGE ACT
For the transition period from: to:
Commission file number: 33-26899-D
The J. Rish Group, Inc.
(Exact Name of Registrant as specified in its charter)
LOUISIANA 84-1082394
(State or other Jurisdiction (IRS Employer Identification
of incorporation or organization) Number)
6748 Renoir
Baton Rouge, Louisiana 70816
(Address code of principal executive offices)
(504) 926-0596
(Issuer's telephone number)
Check mark whether the Issuer (1) has filed all reports required
by Section 13 or 15 (d) of the Exchange Act 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 the
filing requirements for at least the past 90 days. YES: NO:
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PREVIOUS FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13, or 15 (d) of the Exchange
Act after the distribution of securities under a plan confirmed
by the court. YES: NO:
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuers'
classes of common stock, as of the last practicable date:
24,731,000
Transitional Small Business Disclosure Format. YES: NO:
THE J. RISH GROUP
Index
PART I FINANCIAL INFORMATION
Balance Sheet
September 30, 1999 and 1998 3
Statements of Operations
Three Months Ended
September 30, 1999 4
Statements of Cash Flows
Three Months Ended
September 30, 1999 5
Notes to Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of Operations 6-7
PART II Other Information 8-9
Signatures 10
J. Rish Group, Inc.
Estimated Quarterly Balance Sheet
September 30, 1999
UNAUDITED
Current Assets 09/30/98 09/30/99
Cash $ 909,129.26 $ 892,208.18
A/R net of allow for doubtful accts 2,156,288.98 1,415,473.15
Inventory 11,062.00
Prepaid 7,088.52 6,986.13
Total Current Assets 3,072,506.76 2,325,729.46
Property and Equipment NET D/A 416,156.33 985,606.05
Land 469,150.00
Intangible Assets 4,049.18 52,812.00
Due from affiliates 52,234.61
Total Assets 3,544,946.88 3,833,297.51
===============================
Current Liabilities
A/P 293,679.25 1,482,889.79
Third Party Payor Settlements 0.00 876,780.00
Accrued expenses 18,480.33 500,387.46
N/P 556,695.00 1,624,425.90
Total Current Liabilities 868,854.58 4,484,483.15
N/P net of current portion 0.00 0.00
Total Liabilities 868,854.58 4,484,483.15
Equity
Stock 4,000.00 80,036.00
Accumulated Def Prior Yr (187,526.42) 127,351.87
Net Inc (Loss) Current 2,859,618.72 (858,573.51)
Total Liab and Equity 3,544,946.88 3,833,297.51
===============================
J. Rish Group, Inc.
Estimated Quarterly Income Sheet
Third Quarter (3MOS) Ended September 30, 1999
(UNAUDITED)
Third QTR Third QTR
09/30/98 09/30/99
Gross Revenue $ $ 5,408,280.89
Contractual Allowance 2,440,880.20
Net Patient Revenue 1,613,509.74 2,967,400.69
Salaries & Benefits 838,835.19 1,218,796.42
Contract Labor 143,159.13 260,043.23
Insurance 16,437.87 41,892.16
Office Supplies 59,808.24 151,813.39
Management Fees 313,200.00 481,680.53
Consulting 22,180.23 260,921.86
Rent 97,756.20 98,904.33
Repairs & Maintenance 24,470.10 71,808.65
Retent & Recruit 59,751.81 46,632.00
Utilities 28,235.52 71,183.49
Depreciation 37,762.20 0.00
Bad Debts 12,244.77 335,000.00
Merchandise Purchases 22,947.26
Transportation Expense 32,921.10 62,554.96
Miscellaneous Expense 21,738.24 36,259.83
Total Expenses 1,708,500.60 3,160,438.11
Income (Loss) From Operations (94,990.86) (193,037.42)
Interest Income 704.70 0.00
Miscellaneous Income 2,334.42 0.00
Interest Expense (15,675.39) 28,328.70
Total Other
Income/Expense (12,636.27) 28,328.70
Net Income (Loss) $ (107,627.13) $ (221,366.12)
================ ================
UNAUDITED
J. Rish Group, Inc.
Consolidated Statement of Cash Flows
For Nine Months Ending September 30, 1999
UNAUDITED
1999
Cash Flows from Operating Activities (221,366.12)
Net Loss
Adjustments to reconcile net loss to net
cash provided by operating activities:
Provision for Bad Debt 350,000.00
Changes in Assets and Liabilities
Increase in A/R 889,875.68
Decrease in Prepaids 3,699.98
Decrease in A/P and Accrued Exp 104,950.78
Increase in Other Liabilities (68,446.00)
--------------
1,058,714.32
--------------
Cash Flows from Investing Activities
Acquisition of Office Equipment (146,403.55)
Acquisition of Land and Building (500,000.00)
Purchase of Intangible Assets (2,773.33)
--------------
(649,176.88)
--------------
Cash Flows from Financing Activities
Principal Reductions (168,753.93)
Proceeds from Notes Payables 1,161,874.53)
L-T Notes Payable (827,702.83)
--------------
165,417.77
--------------
Increase (Decrease) in Cash 574,955.21
Cash and Cash Equivalents, Beg of Period 317,252.97
--------------
Cash and Cash Equivalents, End of Period 892,208.18
==============
Due to merger and acquisitions and the
comparability of the 1998 cash
Flow statement is not applicable.
The J. Rish Group, Inc.
Notes to Financial Statements
The accompanying condensed unaudited financial statements have
been prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to form 10-QSB. Accordingly, they do not include
all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of
normal recurring adjustments) considered necessary for a fair
presentation have been included. The results of operations for
the periods presented are not necessarily indicative of the
results to be expected for the full year. The accompanying
financial statements should be read in conjunction with the
Company's form 10-KSB filed for the year ended December 31, 1998.
Basic (loss) per share was computed using the weighted average
number of common shares outstanding.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Company during the third quarter ending September 30 1999
experienced substantial revenue growth to over $2,967,400 for the
quarter, due largely to additional acquisitions, which became
fully operational during the third quarter. This revenue level is
a 54 percent increase over the same period for 1998.
During the third quarter, the Company has decreased substantially
the rate at which it continues to produce negative earnings.
Earnings had a deficit figure totaling $211,366 for the quarter,
principally due to the startup expense associated with the newly
acquired Monroe Hospital purchased in May 1999. The Company's
overall strategy is to position itself with a substantially
expanded patient and referral network in anticipation of
Medicare's eventual conversion to a prospective payment system.
Completion of this process will empower the Company to report
positive earnings and enhance stockholder value.
In addition to the above, the Company has emphasized the
development of multi level health care disciplines to private pay
sources. The evolution of the Company's operations into these
areas are projected to produce positive earnings in the
foreseeable future.
The accumulated losses to date are due principally to
readjustments the Company's subsidiaries are effecting as a
result of the Medicare cutbacks made effective in early 1999, and
the retention of professional staff in the areas capped by such
cutbacks. Most of the personnel in such areas are expected to be
utilized in the Company's plan to diversify its patient mix from
Medicare reimbursed programs to private insurance and other payor
sources.
The revenue increases have been the result several acquisitions
brought online during fiscal 1999. The first one opened in 1999
was in Tylertown , Mississippi, and later in Greenville,
Mississippi operating as Rivers Edge Fitness and Rehab, Inc.,
both in the first quarter of 1999. Subsequent to the end of the
first quarter, the Company acquired Wynwood Community Mental
Health, Inc., on May 14, 1999. The clinic is located in Miami,
Florida and is a Joint Commission Accredited Facility.
Additionally, the Company purchased a hospital facility located
in Monroe, Louisiana which operates as Monroe Regional Acute
Rehab Hospital, Inc, a wholly owned subsidiary. The Company has
developed the facility into an inpatient rehab hospital, which is
now fully operational. Also, the Company has opened a new
location in Vicksburg Mississippi, through its newly formed
subsidiary, Vicksburg Regional Outpatient Rehab of Mississippi,
Inc.
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Not applicable.
ITEM 2. CHANGES IN SECURITIES.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Not applicable.
(b) Exhibit 27 - Financial Data Schedule
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.
The J. Rish Group, Inc.
(Registrant)
Dated: December 2, 1999
By:
______________________________________________________
Julian P. Rish, Chief Executive Officer and Controller