-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MmoY8XqjWJfEbJyP/DFE3DD3SYTWaohH5VmMLVS1Olrxi4D6NIG/ODPrFf77vtoc zrs+JDhPgNRRwprh8qYqWA== 0000950131-98-002656.txt : 19980421 0000950131-98-002656.hdr.sgml : 19980421 ACCESSION NUMBER: 0000950131-98-002656 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980420 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: AKORN INC CENTRAL INDEX KEY: 0000003116 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 720717400 STATE OF INCORPORATION: LA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: SEC FILE NUMBER: 000-13976 FILM NUMBER: 98597251 BUSINESS ADDRESS: STREET 1: 100 TRI STATE INTERNATIONAL STREET 2: SUITE 100 CITY: LINCOLNSHIRE STATE: IL ZIP: 60069 BUSINESS PHONE: 8472363800 MAIL ADDRESS: STREET 1: 100 TRI STATE INTERNATIONAL STREET 2: SUITE 100 CITY: LINCOLNSHIRE STATE: IL ZIP: 60069 10-K/A 1 AMD 1 TO FORM 10-K ________________________________________________________________________________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ________________________________________________________________________________ FORM 10-K/A [X] Amendment 1 to Annual Report Filed March 31, 1998 Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the year ended December 31, 1997 [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File Number: 0-13976 AKORN, INC. (Name of small business issuer as specified in its charter) LOUISIANA 72-0717400 (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 100 Tri-State International, Suite 100, Lincolnshire, Illinois 60069 (Address of principal executive offices and zip code) Issuer's telephone number: (847) 236-3800 SECURITIES REGISTERED UNDER SECTION 12(b) OF THE EXCHANGE ACT: None SECURITIES REGISTERED UNDER SECTION 12(g) OF THE EXCHANGE ACT: Common Stock, No Par Value (Title of Class) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed 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 such filing requirements for the past 90 days. Yes X No ----- ----- Indicate by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K is not contained in this form, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ] The aggregate market value of the voting stock held by nonaffiliates (affiliates being, for these purposes only, directors, executive officers and holders of more than 5% of the Issuer's common stock) of the Issuer as of March 5, 1998 was approximately $61,187,000. The number of shares of the Issuer's common stock, no par value per share, outstanding as of March 5, 1998 was 17,701,421. 1 This amendment corrects typographical errors in selected data elements in Item 6. Selected Consolidated Financial Data and Item 8. Financial Statements and Supplemental Data. Item 6. Selected Consolidated Financial Data In October 1996, the Board of Directors of the Company voted to change the Company's fiscal year from the year ending June 30 to a calendar year. The following table sets forth selected consolidated financial information for the Company for the year ended December 31, 1997, the six month transition period ended December 31, 1996 and for the four years ended June 30, 1996:
Six Months Year Ended Ended Years Ended June 30, December 31, December 31, ------------------------------------------- 1997 1996 1996 1995 1994 1993(2) ------------ ------------ ------- ------- ------- ------- PER SHARE Equity $ 1.20 $ 0.98 $ 0.97 $ 0.93 $ 0.76 $ 0.47 Net Income: Basic $ 0.11 $ 0.00 $ 0.05 $ 0.15 $ 0.14 $ 0.12 Diluted $ 0.11 $ 0.00 $ 0.05 $ 0.15 $ 0.14 $ 0.12 Price: High $ 4.50 $ 3.50 $ 3.50 $ 4.00 $ 3.88 $ 3.13 Low $ 1.84 $ 1.63 $ 2.06 $ 2.25 $ 1.88 $ 1.50 P/E: High 41x NM 70x 27x 28x 26x Low 17x NM 41x 15x 13x 13x INCOME DATA (000) Net sales $42,323 $16,519 $33,925 $37,505 $31,266 $23,612 Gross profit 18,776 5,758 11,953 15,177 13,218 9,699 Operating income 3,165 130 1,089 3,910 2,654 1,712 Interest expense (497) (243) (441) (25) (181) (288) Pretax income 2,844 70 977 3,738 2,573 1,518 Income taxes (benefit) 1,052 26 189 1,232 158 (263) Net income $ 1,792 $ 44 $ 788 $ 2,506 $ 2,415 $ 1,781 Weighted average shares outstanding: Basic 16,614 16,580 16,383 16,236 16,185 14,159 Diluted 16,925 16,763 16,788 16,799 16,711 14,955 BALANCE SHEET (000) Current assets $19,633 $13,840 $17,001 $15,474 $15,044 $ 9,209 Net fixed assets 12,395 12,833 11,524 11,060 6,346 5,325 Total assets 38,715 28,013 29,567 27,491 22,190 15,008 Current liabilities 8,612 5,636 9,351 7,016 7,106 3,764 Long-term obligations 9,852 6,003 3,915 4,890 2,380 4,328 Shareholders' equity $20,251 $16,374 $16,301 $15,585 $12,704 $ 6,916 FUNDS FLOW DATA (000) From operations $ 64 $ 2,553 $ 10 $ 712 $ 2,212 $ (479) Dividends paid (1) -- -- (583) -- -- -- From investing (6,387) (2,028) (873) (4,943) (3,745) (531) From financing 7,356 (36) 979 3,112 2,313 (26) Change in cash & equivalents $ 1,033 $ 489 $ 116 $(1,119) $ 780 $(1,036)
All of the information shown in the table above for the four year period ended June 30, 1996 has been restated to reflect the combined operations of Akorn and Pasadena Research Laboratories, Inc. (PRL). (1) Dividends paid pertain to Subchapter S distributions made to former PRL shareholders for pre-acquisition earnings. (2) Includes the reversal of a provision for a litigation judgment ($0.7 million), the reduction of estimated costs of reorganizing manufacturing operations ($0.4 million) and income tax benefits ($0.3 million). 7 AKORN, INC. CONSOLIDATED STATEMENTS OF INCOME (in Thousands, Except per Share Data)
Six Months Year Ended Ended Years Ended June 30, December 31, December 31, 1997 1996 1996 1995 ------------ ------------ --------- --------- Net sales $42,323 $16,529 $33,925 $37,505 Cost of goods sold 23,547 10,761 21,972 22,328 ---------- ----------- --------- --------- GROSS PROFIT 18,776 5,758 11,953 15,177 Selling, general and administrative expenses 12,287 4,819 8,974 10,376 Research and development 1,873 809 1,213 891 Relocation costs 1,451 -- -- -- Acquisition and severance costs -- -- 677 -- ---------- ----------- --------- --------- 15,611 5,628 10,864 11,267 ---------- ----------- --------- --------- OPERATING INCOME 3,165 130 1,089 3,910 Interest and other income (expense): Interest income 41 33 113 106 Interest expense (497) (243) (441) (25) Gain (loss) on marketable equity securities -- -- 80 (308) Other income, net 135 150 136 55 ---------- ----------- --------- --------- (321) (60) (112) (172) ---------- ----------- --------- --------- INCOME BEFORE INCOME TAXES 2,844 70 977 3,738 Income taxes 1,052 26 189 1,232 ---------- ----------- --------- --------- NET INCOME $ 1,792 $ 44 $ 788 $ 2,506 ---------- ----------- --------- --------- NET INCOME PER SHARE: BASIC $ 0.11 $ -- $ 0.05 $ 0.15 ---------- ----------- --------- --------- DILUTED $ 0.11 $ -- $ 0.05 $ 0.15 ---------- ----------- --------- --------- Weighted average shares outstanding: Basic 16,614 16,580 16,383 16,236 ---------- ----------- --------- --------- Diluted 16,925 16,763 16,788 16,799 ---------- ----------- --------- ---------
See notes to consolidated financial statements. 15 AKORN, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Thousands)
Six Months Year Ended Ended Years Ended December 31, December 31, June 30, 1997 1996 1996 1995 ---- ---- ---- ---- OPERATING ACTIVITIES $ 1,792 $ 44 $ 788 $ 2,506 Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,515 720 984 980 (Gain) loss on marketable equity securities -- -- (80) 308 Provision for losses on accounts receivable and inventory 1,188 303 825 160 Deferred income taxes 34 651 (578) 2 Write down of building and equipment 400 -- -- -- Other 43 26 -- (1) Changes in operating assets and liabilities: Accounts receivable (4,170) 267 424 (350) Inventory, prepaid expenses and other assets (2,235) (132) (3,129) (1,420) Trade accounts payable and accrued expenses 1,721 1,438 1,229 (1,514) Income taxes payable 461 (625) (155) 70 Pre-funded development costs (685) (139) (298) (29) -------- -------- -------- -------- NET CASH PROVIDED BY OPERATING ACTIVITIES 64 2,553 10 712 INVESTING ACTIVITIES Purchases of property, plant and equipment (1,154) (1,986) (1,360) (4,818) Product licensing costs (68) (28) (172) (421) Purchases of investments -- (576) (1,173) (2,023) Sales of investments 480 902 1.832 2,319 Purchase of product intangibles (5,645) (340) -- -- -------- -------- -------- -------- NET CASH USED IN INVESTING ACTIVITIES (6,387) (2,028) (873) (4,943) FINANCING ACTIVITIES Proceeds from sale of stock 2,085 29 599 256 Repayments of long-term debt (33) (447) (442) (944) Proceeds from issuance of long-term debt 3,955 1,500 400 3,900 Pre-funded development costs -- -- 150 -- Principal payments under capital lease obligations (151) (74) (151) (58) Short-term borrowings, net 1,500 (1,044) 1,006 128 Dividends paid -- -- (583) -- Debt acquisition costs -- -- -- (170) -------- -------- -------- -------- NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 7.356 (36) 979 3,112 -------- -------- -------- -------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 1,033 489 116 (1,119) Cash and cash equivalents at beginning of year 1,380 891 775 1,894 -------- -------- -------- -------- CASH AND CASH EQUIVALENTS AT END OF YEAR $ 2,413 $ 1,380 $ 891 $ 775 -------- -------- -------- -------- See notes to consolidated financial statements.
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