-----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, PAPGRE16sTP6aBI2F+8N3u1zxN5suyWoX46gXik9oZYZoBw6fpn1E5rhY/9B0nY/ OmEunno5n6VbWBKWs4GifA== 0000355019-10-000005.txt : 20100223 0000355019-10-000005.hdr.sgml : 20100223 20100223141851 ACCESSION NUMBER: 0000355019-10-000005 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20091231 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20100223 DATE AS OF CHANGE: 20100223 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FONAR CORP CENTRAL INDEX KEY: 0000355019 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 112464137 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-10248 FILM NUMBER: 10625305 BUSINESS ADDRESS: STREET 1: 110 MARCUS DR CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 6316942929 MAIL ADDRESS: STREET 1: 110 MARCUS DRIVE CITY: MELVILLE STATE: NY ZIP: 11747 8-K 1 fonar-8k.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Act of 1934 Date of Report (Date of earliest event reported): February 22, 2010 FONAR CORPORATION ------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 0-10248 11-2464137 - --------------- ---------------- ------------------- (State or other (Commission File (I.R.S. Employer jurisdiction of Number) Identification No.) incorporation) 110 Marcus Drive Melville, New York 11747 (631) 694-2929 --------------------------------------------------- (Address, including zip code, and telephone number of registrant's principal executive office) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c) Item 2.02(a) Results of Operations and Financial Condition. We reported our results of operations and financial condition for the fiscal quarter ended September 30, 2009 in a press release dated November 23, 2009. Exhibits 99.1 Press Release dated February 22, 2010 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. FONAR CORPORATION (Registrant) By: /s/ Raymond Damadian Raymond Damadian President and Chairman Dated: February 23, 2010 EX-99 2 a222x99.txt Exhibit 99.1 ================================================================================ FONAR CORPORATION * Fonar MRI news @ aol . com Inventor of MR Scanning(TM) For Immediate Release An ISO 9001 Company Contact: Daniel Culver 110 Marcus Drive Director of Communications Melville, New York 11747 Web site: www.fonar.com Telephone: (631) 694-2929 Email: investor@fonar.com Fax Number: (631) 390-1709 ================================================================================ FONAR ANNOUNCES FINANCIAL RESULTS FOR SECOND QUARTER OF FISCAL 2010 MELVILLE, NEW YORK, February 22, 2010 - FONAR Corporation (NASDAQ-FONR), today announced its financial results for the second quarter of fiscal 2010, which ended December 31, 2009. Total revenues for the second quarter of fiscal 2010 ended December 31, 2009, were $8.2 million as compared to $11.3 million for the same period last year which ended December 31, 2008. Total revenues for the six months ended December 31, 2009 were $15.7 million as compared to $18.1 million for the same period last year. During the second fiscal 2010 quarter ended December 31, 2009, the net loss was $1.3 million as compared to a profit of $800,000 during the corresponding quarter ended December 31, 2008. The net loss for the six months period ended December 31, 2009 was $3.0 million as compared to a net income of $300,000 during the same period one year earlier. The loss per common share (basic and diluted) for the second fiscal quarter of 2010 was $0.26 as compared to a profit per common share (basic and diluted) of $0.16 during the same period one year earlier. The principal reason for the smaller net loss in the first half of fiscal 2009 as compared to the first half of fiscal 2010 was that during the first quarter of fiscal 2009, we recognized a gain of $1.4 million on the sale of a consolidated entity managing an MRI scanning facility and, $1.8 million in license fees and royalties in the first half of fiscal 2009 as compared to $0 in license fees and royalties in the first half of fiscal 2010. The license fees were paid pursuant to an agreement which has expired. During the second fiscal 2010 quarter for the period ended December 31, 2009, product sales were $3.0 million versus $4.4 million for the same period last year. In addition, product sales for the six month period ended December 31, 2009 were $4.5 million as compared to $5.8 million for the same period last year. Service and repair revenues for the second fiscal 2010 quarter ended December 31, 2009, were $2.7 million as compared to $2.7 million for the same period last year. Service and repair revenues for the six month period ended December 31, 2009 were $5.5 million as compared to $5.3 million during the same period during the previous year. As of December 31, 2009, there were 141 FONAR UPRIGHT(R) MRI units installed worldwide. As of December 31, 2009, total cash, cash equivalents and marketable securities were approximately $1.1 million, total current assets were $17.0 million, total assets were $24.9 million, total current liabilities were $28.8 million, and total long-term liabilities were $2.0 million. Quarter Highlights On December 7, 2009, the company finished the installation of an UPRIGHT(R) Multi-Position(TM) MRI at The Hospital ZorgSaam Zeeuws-Vlaanderen in Terneuzen, The Netherlands. The UPRIGHT(R) MRI was sold by Tecserena GmbH, FONAR's European distributor since 2006. At the time of the sale, radiologists at hospital ZorgSaam Zeeuws-Vlaanderen said they sought the advanced technology provided by the FONAR UPRIGHT(R) Multi-Position(TM) MRI to increase the diagnostic precision of the images of weight-bearing anatomy, establishing for their hospital a new standard of excellence throughout Europe for orthopedic surgical outcomes. Camiel Raaijmakers, M.D., Terneuzen Hospital, said, "My colleague, Frank Raat, M.D. and I as radiologists became intrigued and fascinated by the FONAR UPRIGHT(R) MRI system during our yearly visits to the Radiological Society of North America (RSNA) exhibit in Chicago. We realized that UPRIGHT(R) MR imaging could be the answer for many of our questions in spinal imaging that cannot adequately be solved with our recumbent MRI system, especially patients with degenerative instability and spinal canal stenosis, whiplash patients and postoperative patients with failed back surgery. In younger patients, in need of scoliosis imaging, it is the perfect answer to reduce the radiation exposure during yearly follow-ups." Dr. Raaijmakers continued "In our hospital in Terneuzen, The Netherlands, there is a multidisciplinary approach to pelvic floor problems. The UPRIGHT(R) MRI is an ideal tool for non-invasive dynamic pelvic floor imaging." "It (The FONAR UPRIGHT(R) Multi-Position MRI(TM)) is a very patient and child-friendly truly open MRI system that is easily accessible for obese and claustrophobic patients. But also, cardiovascular compromised patients can be examined in an upright position, which is an added value to the existing diagnostic modalities," explained Dr. Raaijmakers. Hospital ZorgSaam Zeeuws-Vlaanderen in Terneuzen, The Netherlands, is a 340-bed hospital. A very significant amount of orthopedic and spine surgery is done at the hospital. It is also one of the biggest centers in The Netherlands for the treatment of obese patients and especially bariatric surgery. For details visit: http://www.fonar.com/news/012808.htm On December 17, 2009, FONAR announced that the Center for Diagnostic Imaging (CDI) (Minneapolis, MN) purchased a third FONAR UPRIGHT(R) Multi- Position(TM) MRI. It is scheduled to be installed in early 2010 at CDI's OpenScan MRI center in Duluth, Minnesota. "This is the first and only FONAR UPRIGHT(R) Multi-Position(TM) MRI scanner in Northern Minnesota," said Rick Long, Regional Vice President, Minnesota. "With our high-field, recumbent MRI scanner already in the market, the replacement of our existing lower field strength open-sided MRI scanner with an Open Upright MRI was critical to providing residents access to diagnostic services that could impact their quality of care. Now patients and their doctors get the dual benefit of the open comfort and higher quality images to guide diagnosis in one scanner." Raymond Damadian, president and founder of FONAR, commented on the second fiscal quarter ended December 31, 2009. "Nationally, this calendar year has been a challenging one for everyone. FONAR has had to further reduce its overhead. In early 2010 we began a cost-cutting plan to bring our expenditures in line with revenues. With our costs reduced, we expect to be much improved going forward." FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's OMITTED) ASSETS December 31, June 30, 2009 2009 (UNAUDITED) Current Assets: ---------- ---------- Cash and cash equivalents $ 1,071 $ 1,226 Marketable securities 30 23 Accounts receivable - net 5,922 5,392 Accounts receivable - related parties - net 119 - Medical receivables - net 224 374 Management fee receivable - net 3,112 3,274 Management fee receivable - related medical practices - net 1,803 2,196 Costs and estimated earnings in excess of billings on uncompleted contracts 1,257 1,476 Inventories 2,839 3,172 Current portion of advances and notes to related medical practices 173 165 Current portion of notes receivable 85 518 Prepaid expenses and other current assets 340 472 ---------- ---------- Total Current Assets 16,975 18,288 ---------- ---------- Property and equipment - net 2,495 2,892 Advances and notes to related medical practices - net - 89 Notes receivable - net 142 1,779 Other intangible assets - net 4,896 4,920 Other assets 392 391 ---------- ---------- Total Assets $ 24,900 $ 28,359 ========== ========== FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's OMITTED) LIABILITIES AND STOCKHOLDERS' DEFICIENCY 2009 2009 December 31, June 30, (UNAUDITED) Current Liabilities: ---------- ---------- Current portion of long-term debt and capital leases $ 314 $ 277 Current portion of long-term debt - related party 84 80 Accounts payable 3,456 3,519 Other current liabilities 8,558 8,460 Unearned revenue on service contracts 5,910 5,526 Unearned revenue on service contracts - related parties 110 - Customer advances 7,240 9,238 Billings in excess of costs and estimated earnings on uncompleted contracts 3,114 2,026 ---------- ---------- Total Current Liabilities 28,786 29,126 Long-Term Liabilities: Accounts payable 89 184 Due to related medical practices 645 643 Long-term debt and capital leases, less current portion 682 759 Long-term debt less current portion - related party 117 160 Other liabilities 459 428 ---------- ---------- Total Long-Term Liabilities 1,992 2,174 ---------- ---------- Total Liabilities 30,778 31,300 ---------- ---------- FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's OMITTED, except share data) LIABILITIES AND STOCKHOLDERS' DEFICIENCY December 31, June 30, (continued) 2009 2009 (UNAUDITED) ---------- ---------- STOCKHOLDERS' DEFICIENCY: Class A non-voting preferred stock $.0001 par value; 1,600,000 authorized, 313,451 issued and outstanding at December 31, 2009 and June 30, 2009 - - Preferred stock $.001 par value; 2,000,000 shares authorized, issued and outstanding - none - - Common Stock $.0001 par value; 30,000,000 shares authorized at December 31, 2009 and June 30, 2009, 4,927,918 and 4,917,918 issued at December 31, 2009 and June 30, 2009, respectively; 4,916,275 and 4,906,275 outstanding at December 31, 2009 and June 30, 2009, respectively 1 1 Class B Common Stock $ .0001 par value; 800,000 shares authorized, (10 votes per share), 158 issued and outstanding at December 31, 2009 and June 30, 2009 - - Class C Common Stock $.0001 par value; 2,000,000 shares authorized, (25 votes per share), 382,513 issued and outstanding at December 31, 2009 and June 30, 2009 - - Paid-in capital in excess of par value 172,298 172,280 Accumulated other comprehensive loss ( 15) ( 21) Accumulated deficit (177,292) (174,259) Notes receivable from employee stockholders ( 195) ( 267) Treasury stock, at cost - 11,643 shares of common stock at December 31, 2009 and June 30, 2009 ( 675) ( 675) ---------- ---------- Total Stockholders' Deficiency ( 5,878) ( 2,941) ---------- ---------- Total Liabilities and Stockholders' Deficiency $ 24,900 $ 28,359 ========== ========== FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (000's OMITTED, except per share data) FOR THE THREE MONTHS ENDED DECEMBER 31, ---------------------- 2009 2008 REVENUES ---------- ---------- Product sales - net $ 2,961 $ 4,407 Service and repair fees - net 2,629 2,624 Service and repair fees - related parties - net 55 55 Management and other fees - net 1,738 1,735 Management and other fees - related medical practices - net 830 714 License fees and royalties - 1,755 ---------- ---------- Total Revenues - Net 8,213 11,290 ---------- ---------- COSTS AND EXPENSES Costs related to product sales 2,279 2,824 Costs related to service and repair fees 978 1,027 Costs related to service and repair fees - related parties 20 22 Costs related to management and other fees 1,384 1,074 Costs related to management and other fees - related medical practices 745 698 Research and development 777 928 Selling, general and administrative 3,100 3,471 Provision for bad debts 197 545 ---------- ---------- Total Costs and Expenses 9,480 10,589 ---------- ---------- (Loss) Income From Operations ( 1,267) 701 Interest Expense ( 90) ( 40) Interest Expense - Related Party ( 5) - Investment Income 66 113 Interest Income - Related Party 3 6 Other Income 1 1 ---------- ---------- NET (LOSS) INCOME $ ( 1,292) $ 781 ========== ========== Basic Net (Loss) Income Per Common Share $ (0.26) $ 0.16 ========== ========== Diluted Net (Loss) Income Per Common Share $ (0.26) $ 0.16 ========== ========== Weighted Average Basic Shares Outstanding 4,916,275 4,904,275 ========== ========== Weighted Average Diluted Shares Outstanding 4,916,275 4,904,275 ========== ========== FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (000's OMITTED, except per share data) FOR THE SIX MONTHS ENDED DECEMBER 31, ---------------------- 2009 2008 REVENUES ---------- ---------- Product sales - net $ 4,524 $ 5,819 Service and repair fees - net 5,386 5,170 Service and repair fees - related parties - net 110 110 Management and other fees - net 3,473 3,782 Management and other fees - related medical practices - net 1,625 1,439 License fees and royalties 585 1,755 ---------- ---------- Total Revenues - Net 15,703 18,075 ---------- ---------- COSTS AND EXPENSES Costs related to product sales 3,936 4,265 Costs related to service and repair fees 1,919 2,038 Costs related to service and repair fees - related parties 39 43 Costs related to management and other fees 2,651 2,277 Costs related to management and other fees - related medical practices 1,505 1,354 Research and development 1,631 1,809 Selling, general and administrative 6,333 6,735 Provision for bad debts 377 700 ---------- ---------- Total Costs and Expenses 18,391 19,221 ---------- ---------- Loss From Operations ( 2,688) ( 1,146) Interest Expense ( 169) ( 119) Interest Expense - Related Party ( 19) - Investment Income 153 145 Interest Income - Related Party 6 12 Other Income 34 2 Minority Interest in Income of Partnerships - ( 11) Gain on Sale of Consolidated Subsidiary - 1,448 Loss on Note Receivable ( 350) - ---------- ---------- NET (LOSS) INCOME $ (3,033) $ 331 ========== ========== Basic Net (Loss) Income Per Common Share $ (0.62) $ 0.07 ========== ========== Diluted Net (Loss) Income Per Common Share $ (0.62) $ 0.07 ========== ========== Weighted Average Basic Shares Outstanding 4,912,108 4,904,275 ========== ========== Weighted Average Diluted Shares Outstanding 4,912,108 4,904,275 ========== ========== Visit FONAR's Website for product and investor information: www.fonar.com # This release may include forward-looking statements from the company that may or may not materialize. Additional information on factors that could potentially affect the company's financial results may be found in the company filings with the Securities and Exchange Commission. ### -----END PRIVACY-ENHANCED MESSAGE-----