SOURCE: FONAR Corporation

Fonar Corporation

November 09, 2016 17:00 ET

FONAR Announces 1st Quarter Financial Results For Fiscal 2017

MELVILLE, NY--(Marketwired - Nov 9, 2016) - FONAR Corporation (NASDAQ: FONR)

  • Diluted Net Income per Common Share Available to Common Stockholders increased 26% to $0.54 per share for 1st Quarter Fiscal 2017 from $0.43 during the same quarter one year earlier.
  • Net Income Available to Common Stockholders increased 25% to $3.3 million for 1st Quarter Fiscal 2017 versus the same quarter one year earlier.
  • Net Income increased 30% to $4.5 million for 1st Quarter Fiscal 2017 versus the same quarter one year earlier.
  • Income from Operations for 1st Quarter Fiscal 2017 increased 31% to $4.8 million versus the same quarter one year earlier.
  • Total Revenues - Net for 1st Quarter Fiscal 2017 increased 6% to $18.7 million versus the same quarter one year earlier.

FONAR Corporation (NASDAQ: FONR), The Inventor of MR Scanning™, reported today its first quarter fiscal 2017 results for the quarter ended September 30, 2016. The Company introduced the world's first commercial MRI scanner in 1980, and is known the world over for its advancements in MRI technology. FONAR's primary source of income is derived from the management of 25 MRI centers that feature the FONAR UPRIGHT® Multi-Position™ MRI, aka Stand-Up® MRI. FONAR's substantial list of patents include recent patents for its technology enabling full weight-bearing MRI imaging on all the gravity sensitive regions of the human anatomy, especially the brain, extremities and spine.

These include FONAR's newest works-in-progress technology for visualizing and quantifying the flow of cerebrospinal fluid (CSF) which circulates throughout the brain and vertebral column at the rate of 32 quarts per day. Imaging and quantifying the dynamics of this vital life-sustaining physiology of the body's neurologic system has been made possible by FONAR's introduction of the MRI and its latest works-in-progress for quantifying CSF in all the normal positions of the body, particularly in its upright flow against gravity.

The FONAR UPRIGHT® Multi-Position™ MRI scanner is the world's only MRI scanner licensed under FONAR's multiple UPRIGHT® MRI patents to scan all the patient's body parts in their normal full weight-bearing UPRIGHT® position.

Financial Highlights
Total Revenues - Net for the quarter ended September 30, 2016 increased 6% to $18.7 million as compared to $17.6 million for the corresponding quarter ended September 30, 2015.

Net Income for the quarter ended September 30, 2016 increased 30% to $4.5 million as compared to $3.5 million for the corresponding quarter ended September 30, 2015.

Income from Operations for the quarter ended September 30, 2016 increased 31% to $4.8 million as compared to $3.6 million for the corresponding quarter ended September 30, 2015.

Basic Net Income per Common Share Available to Common Shareholders for the quarter ended September 30, 2016 increased 25% to $0.55 as compared to $0.44 for the corresponding quarter ended September 30, 2015.

Diluted Net Income per Common Share Available to Common Shareholders for the quarter ended September 30, 2016 increased 26% to $0.54 as compared to $0.43 for the corresponding quarter ended September 30, 2015.

Total Assets at September 30, 2016 were $86.1 million, as compared to $84.9 million at June 30, 2016.

Total Current Assets at September 30, 2016 were $47.0 million, as compared to $45.6 million at June 30, 2016.

Total Cash and Cash Equivalents at September 30, 2016 was $8.0 million, as compared to $8.5 million at June 30, 2016.

Total Liabilities at September 30, 2016 were $20.5 million, as compared to $24.1 million at June 30, 2016.

Total Current Liabilities at September 30, 2016 were $18.3 million, as compared to $20.6 million at June 30, 2016.

Management Discussion
President and CEO Timothy R. Damadian said, "I am delighted with our Diluted Net Income Per Common Share Available to Common Stockholders of $0.54, a 26% year-over-year increase. Further, Net Income Available to the Common Stockholder advanced to $3.3 million, a 25% increase, and Income from Operations grew to $4.8 million, a 31% increase. 

"Despite the uncertainties and challenges in today's healthcare arena, we are proud to have achieved a 6% growth rate in Net Revenue and a 31% increase in Income from Operations in the first quarter as compared to the first quarter of fiscal 2016. Much of our success is attributable to key acquisitions, and so we will continue to seek additional opportunities consistent with our growth strategy." 

Raymond V. Damadian, M.D. Chairman of the Board of FONAR Corporation, said, "Another important reason for our success is the tremendous appeal the UPRIGHT® Multi-Position™ MRI has among patients. Most patients are scanned in the seated position watching TV, and for patients who are claustrophobic, it's a godsend. In fact, it's very common for patients to ask their physicians if they can have their MRI scans completed on the UPRIGHT® MRI, as opposed to a 'tube' or 'tunnel' MRI. Furthermore, among the growing number of physicians who recognize the diagnostic value of scanning patients in weight-bearing positions, particularly patients who need MRIs of the spine, the UPRIGHT® is the only choice.

"I am personally grateful," continued Dr. Damadian, "that after many years of struggle, FONAR has become a very successful Company. Thanks to the medical benefits of FONAR's unique and patented technology, together with our management team's adherence to a business plan designed to cope with a very uncertain and challenging healthcare environment, we have now achieved 26 consecutive quarters (6 1/2 years) of profitability. And that's something to be proud of."

About FONAR
FONAR, The Inventor of MR Scanning™, is located in Melville, NY, was incorporated in 1978, and is the first, oldest and most experienced MRI company in the industry. FONAR introduced the world's first commercial MRI in 1980, and went public in 1981. FONAR's signature product is the FONAR UPRIGHT® Multi-Position™ MRI (also known as the Stand-Up® MRI), the only whole-body MRI that performs Position™ Imaging (pMRI™) and scans patients in numerous weight-bearing positions, i.e. standing, sitting, in flexion and extension, as well as the conventional lie-down position. The FONAR UPRIGHT® MRI often detects patient problems that other MRI scanners cannot because they are lie-down and "weightless" only scanners. The patient-friendly UPRIGHT® MRI has a near-zero patient claustrophobic rejection rate. As a FONAR customer states, "If the patient is claustrophobic in this scanner, they'll be claustrophobic in my parking lot." Approximately 85% of patients are scanned sitting while watching TV.

FONAR has new works-in-progress technology for visualizing and quantifying the cerebral hydraulics of the central nervous system, the flow of cerebrospinal fluid (CSF), which circulates throughout the brain and vertebral column at the rate of 32 quarts per day. This imaging and quantifying of the dynamics of this vital life-sustaining physiology of the body's neurologic system has been made possible first by FONAR's introduction of the MRI and now by this latest works-in-progress method for quantifying CSF in all the normal positions of the body, particularly in its upright flow against gravity. Patients with whiplash or other neck injuries are among those who will benefit from this new understanding.

FONAR's substantial list of patents includes recent patents for its technology enabling full weight-bearing MRI imaging of all the gravity sensitive regions of the human anatomy, especially the brain, extremities and spine. It includes its newest technology for measuring the Upright cerebral hydraulics of the central nervous system. FONAR's UPRIGHT® Multi-Position™ MRI is the only scanner licensed under these patents.

UPRIGHT® and STAND-UP® are registered trademarks and The Inventor of MR Scanning™, Full Range of Motion™, Multi-Position™, Upright Radiology™, The Proof is in the Picture™, True Flow™, pMRI™, Spondylography™, Dynamic™, Spondylometry™, CSP™, and Landscape™, are trademarks of FONAR Corporation.

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's filings with the Securities and Exchange Commission.

 
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts and shares in thousands, except per share amounts)
(UNAUDITED)
 
 ASSETS
 
    September 30,
2016
  June 30,
2016 *
Current Assets:            
  Cash and cash equivalents   $ 7,994   $ 8,528
  Accounts receivable - net     4,604     4,370
  Accounts receivable - related party     90     -
  Medical receivable - net     10,547     10,127
  Management and other fees receivable - net     16,560     15,638
  Management and other fees receivable - related medical practices - net     4,232     4,064
  Inventories     2,214     2,074
  Prepaid expenses and other current assets     722     759
Total Current Assets     46,963     45,560
  Deferred income tax asset     13,042     13,042
  Property and equipment - net     14,563     14,513
  Goodwill     3,322     3,322
  Other intangible assets - net     7,456     7,719
  Other assets     794     732
Total Assets   $ 86,140   $ 84,888
             

*Condensed from audited financial statements. 

 
 
 
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts and shares in thousands, except per share amounts)
(UNAUDITED)
 
 LIABILITIES AND STOCKHOLDERS' EQUITY
 
    September 30,
2016
  June 30,
2016 *
Current Liabilities:            
  Current portion of long-term debt and capital leases   $ 2,436   $ 2,448
  Accounts payable     1,304     1,254
  Other current liabilities     8,269     10,827
  Unearned revenue on service contracts     4,936     4,679
  Unearned revenue on service contracts - related party     83     -
  Customer deposits     1,067     1,199
             
  Billings in excess of costs and estimated earnings on uncompleted contracts     176     207
Total Current Liabilities     18,271     20,614
Long-Term Liabilities:            
Deferred income tax liability     482     482
Due to related medical practices     236     245
Long-term debt and capital leases, less current portion     661     2,059
Other liabilities     803     712
Total Long-Term Liabilities     2,182     3,498
Total Liabilities     20,453     24,112

*Condensed from audited financial statements.

 
 
 
FONAR CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts and shares in thousands, except per share amounts)
(UNAUDITED)
 
 LIABILITIES AND STOCKHOLDERS' EQUITY (Continued)
 
STOCKHOLDERS' EQUITY:   September 30, 2016     June 30, 2016 *  
Class A non-voting preferred stock $.0001 par value; 453 shares authorized at September 30, 2016 and June 30, 2016, 313 issued and outstanding at September 30, 2016 and June 30, 2016   $ -     $ -  
Preferred stock $.001 par value; 567 shares authorized at September 30, 2016 and June 30, 2016, issued and outstanding - none     -       -  
Common Stock $.0001 par value; 8,500 shares authorized at September 30, 2016 and June 30, 2016, 6,170 and 6,062 issued at September 30, 2016 and June 30, 2016, respectively; 6,158 and 6,051 outstanding at September 30, 2016 and June 30, 2016, respectively     1       1  
Class B Common Stock (10 votes per share) $.0001 par value; 227 shares authorized at September 30, 2016 and June 30, 2016; .146 issued and outstanding at September 30, 2016 and June 30, 2016     -       -  
Class C Common Stock (25 votes per share) $.0001 par value; 567 shares authorized at September 30, 2016 and June 30, 2016, 383 issued and outstanding at September 30, 2016 and June 30, 2016     -       -  
Paid-in capital in excess of par value     175,948       173,702  
Accumulated deficit     (117,053 )     (120,624 )
Notes receivable from employee stockholders     (22 )     (24 )
Treasury stock, at cost - 12 shares of common stock at September 30, 2016 and June 30, 2016     (675 )     (675 )
Total Fonar Corporation Stockholder Equity     58,199       52,380  
Noncontrolling interests     7,488       8,396  
Total Stockholders' Equity     65,687       60,776  
Total Liabilities and Stockholders' Equity   $ 86,140     $ 84,888  

*Condensed from audited financial statements.

   
   
   
FONAR CORPORATION AND SUBSIDIARIES  
CONDENSED CONSOLIDATED STATEMENTS OF INCOME  
(Amounts and shares in thousands, except per share amounts)  
(UNAUDITED)  
   
    FOR THE THREE MONTHS ENDED SEPTEMBER 30,  
REVENUES   2016     2015  
  Product sales - net   $ 242     $ 18  
  Service and repair fees - net     2,351       2,284  
  Service and repair fees - related parties - net     28       28  
  Patient fee revenue, net of contractual allowances and discounts     8,823       8,114  
  Provision for bad debts for patient fee     (3,878 )     (3,507 )
  Management and other fees - net     9,261       8,829  
  Management and other fees - related medical practices - net     1,907       1,845  
    Total Revenues - Net     18,734       17,611  
COSTS AND EXPENSES                
  Costs related to product sales     213       112  
  Costs related to service and repair fees     655       543  
  Costs related to service and repair fees - related parties     8       7  
  Costs related to patient fee revenue     2,414       2,228  
  Costs related to management and other fees     5,261       5,419  
  Costs related to management and other fees - related medical practices     953       1,058  
  Research and development     412       436  
  Selling, general and administrative     4,065       4,193  
    Total Costs and Expenses     13,981       13,996  
Income From Operations     4,753       3,615  
Interest Expense     (98 )     (150 )
Investment Income     48       50  
Other Expense     (3 )     -  
Income Before Provision for Income Taxes and Noncontrolling Interests     4,700       3,515  
  Provision for Income Taxes     200       50  
Net Income     4,500       3,465  
Net Income - Noncontrolling Interests     (929 )     (603 )
Net Income - Controlling Interests   $ 3,571     $ 2,862  
Net Income Available to Common Stockholders   $ 3,343     $ 2,676  
Net Income Available to Class A Non-Voting Preferred Stockholders   $ 170     $ 139  
Net Income Available to Class C Common Stockholders   $ 58     $ 47  
Basic Net Income Per Common Share Available to Common Stockholders   $ 0.55     $ 0.44  
Diluted Net Income Per Common Share Available to Common Stockholders   $ 0.54     $ 0.43  
Basic and Diluted Income Per Share - Class C Common   $ 0.15     $ 0.12  
Weighted Average Basic Shares Outstanding - Common Stockholders     6,105       6,050  
Weighted Average Diluted Shares Outstanding - Common Stockholders     6,233       6,178  
Weighted Average Basic Shares Outstanding - Class C Common     383       383  
Weighted Average Diluted Shares Outstanding - Class C Common     383       383  

Contact Information

  • Contact:
    Daniel Culver
    Director of Communications
    E-mail: Email Contact
    www.fonar.com

    The Inventor of MR Scanning™
    An ISO 9001 Company
    Melville, New York 11747
    Phone: (631) 694-2929
    Fax: (631) 390-1772