UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended March 31, 2004
Commission File Number 000-20175
NYER MEDICAL GROUP, INC.
(Exact name of registrant as specified in its charter)
Florida 01-0469607
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1292 Hammond Street, Bangor, Maine 04401
(Address of principal executive offices) (Zip Code)
(207) 942-5273 (Registrant's telephone number,
including area code)
Securities registered under Section 12(b) of the Exchange Act:
Name of Exchange
Title of Each Class on which registered
None None
Check whether the registrant has (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past twelve months (or for
such shorter periods 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 .
As of May 17, 2004 there were 3,784,962 shares of common stock outstanding, par
value $.0001 per share.
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
INDEX
PART I
FINANCIAL INFORMATION
Page No.
Item 1. Financial Statements:
Consolidated Balance Sheets, March 31, 2004
and June 30, 2003 3
Consolidated Statements of Operations, Three Months
Ended March 31, 2004 and March 31, 2003 5
Consolidated Statements of Operations, Nine Months
Ended March 31, 2004 and March 31, 2003 5
Consolidated Statements of Cash Flows, Nine Months
Ended March 31, 2004 and March 31, 2003 6
Selected Notes to Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 13
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 22
Item 4. Controls and Procedures 22
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 23
Item 2. Changes in Securities, Use of Proceeds and Issuer Purchases
of Equity Securities 23
Item 3. Defaults upon Senior Securities 23
Item 4. Submissions of Matters to Vote of Security Holders 23
Item 5. Other information 23
Item 6. Exhibits and Reports on Form 8-K 23
Signatures 25
Exhibit 31.1 Certification Pursuant to Rules 13a-14(a) and 15d-14(a) of the
Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of
2002 by Principal Executive Officer 26
Exhibit 31.2 Certification Pursuant to Rules 13a-14(a) and 15d-14(a) of the
Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of
2002 by Principal Financial and Accounting Officer 27
Exhibit 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Chief Executive
Officer 28
Exhibit 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Chief Financial
Officer 29
2
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
Item 1. Financial Statements:
NYER MEDICAL GROUP, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
March 31, June 30,
2004 2003
---- ----
(Unaudited)
Current assets:
Cash and cash equivalents $ 950,777 $ 1,391,666
Accounts receivable, less allowance
for doubtful accounts of $416,293
at March 31, 2004 and $348,352
at June 30, 2003 4,452,430 4,357,856
Inventories, net 6,176,843 5,812,186
Prepaid expenses and other current
assets 443,636 250,585
Deferred tax asset 88,359 185,000
Assets to be disposed of from
discontinued operations - 201,281
----------- -----------
Total current assets 12,112,045 12,198,574
---------- ----------
Property, plant and equipment, net
Of accumulated depreciation 1,355,878 1,286,269
--------- ---------
Goodwill 104,463 104,463
Other intangible assets, net 578,375 666,281
Advances due from related
companies - 44,858
------- ------
682,838 815,602
------- -------
Total assets $14,150,761 $14,300,445
=========== ===========
See accompanying notes to consolidated financial statements.
3
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
March 31, June 30,
2004 2003
(Unaudited)
Current liabilities:
Current portion of long-term debt $ 243,407 $ 291,485
Accounts payable 3,939,260 3,831,147
Accrued payroll and related taxes 355,728 446,807
Other accrued expenses 572,144 259,460
Income taxes payable, net - 101,753
Liabilities to be disposed of from
discontinued operations - 390,873
-------- -------
Total current liabilities 5,110,539 5,321,525
--------- ---------
Long-term debt, net of current
portion 252,653 418,425
Minority interest 1,358,179 1,243,533
Shareholders' equity:
Class A preferred stock, par value
$.0001, authorized, issued and
outstanding: 2,000 shares 1 1
Class B preferred stock, series 1,
par value $.0001, authorized:
2,500,000; issued and outstanding:
1,000 shares
Common stock, par value $.0001
authorized: 10,000,000 shares;
issued: 3,799,062 380 380
Additional paid-in capital 17,746,543 17,746,543
Treasury stock (14,100 shares) (54,573) (54,573)
Accumulated deficit (10,262,961) (10,375,389)
----------- -----------
Total shareholders' equity 7,429,390 7,316,962
--------- ---------
Total liabilities and
shareholders' equity $14,150,761 $14,300,445
=========== ===========
See accompanying notes to consolidated financial statements.
4
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended Nine Months Ended
March 31, 2004 March 31, 2003 March 31, 2004 March 31,
2003
Net sales $15,184,276 $14,232,546 $46,885,890 $42,845,420
Cost and expenses:
Cost of goods sold 11,910,025 11,178,020 36,576,715 33,653,267
Selling and retail 2,239,441 1,865,449 6,465,851 5,510,608
Warehouse and delivery 295,457 248,870 799,534 743,430
Administrative 941,455 914,890 2,660,187 2,378,021
------- ------- --------- --------
15,386,378 14,207,229 46,502,287 42,285,326
---------- ---------- ---------- ---------
Operating (loss)
income (202,102) 25,317 383,603 560,094
-------- ------ ------- -------
Other income (expense):
Interest income 9,948 10,658 35,340 33,715
Interest expense (9,297) (8,951) (31,340) (26,791)
Other 60,532 290 60,654 1,044
------ --- ------ -----
Total other income 61,183 1,997 64,654 7,968
------ ----- ------ -----
(Loss) income from
continuing operations
before income taxes and
minority interest (140,919) 27,314 448,257 568,062
Provision for income
taxes: 71,885 (10,800) (180,300) (90,800)
------ ------- -------- -------
(Loss) income from
continuing operations
before minority interest(69,034) 16,514 267,957 477,262
Minority interest, net of
income taxes of $16,374,
$2,000, $76,600 and
$18,000, respectively (24,295) (28,263) (114,646) (167,878)
------- ------- -------- --------
(Loss) income from
continuing operations (93,329) (11,749) 153,311 309,384
------- ------- ------- -------
Discontinued operations:
Net income (loss) from
discontinued operations,
net of income tax $444
and benefit of $27,858
for March 31, 2004 584 (53,320) (40,883) 125,435)
--- ------- ------- --------
Net (loss) income $ (92,745) $ (65,069) $ 112,428 $ 183,949
=========== =========== =========== ========
Basic and diluted income
(loss) per share:
Continuing operations$ (.03) $ - $ .04 $.08
Discontinued operations - (.02) (.01) (.03)
---- ---- ---- ----
Basic and diluted income
(loss) per share $ (.03) $ (.02) $ .03 $.05
======= ======= ======= ======
Weighted average common shares
outstanding:
Basic 3,784,962 3,756,962 3,784,962 3,756,962
========= ========= ========= =========
Diluted 3,784,962 3,756,962 4,009,928 3,760,638
========= ========= ========= =========
See accompanying notes to consolidated financial statements.
5
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
March 31, March 31,
2004 2003
Cash flows from operating activities:
Net income from continuing operations $ 153,311 $ 309,384
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation 294,675 260,918
Amortization 87,906 44,088
Deferred tax 96,641 -
Other assets 44,858 -
Loss (gain) on sale of property,
plant and equipment 3,639 (300)
Minority interest 114,646 167,878
Changes in certain working capital
elements (424,317) (795,621)
Net cash flows provided by
operating activities from
continuing operations 371,359 (13,653)
Net cash flows used in discontinued
operations (230,475) 34,102
Net cash provided by operating
activities 140,884 20,449
Cash flows from investing activities:
Purchase of pharmacy assets - (240,000)
Purchase of property, plant and
equipment (379,236) (248,594)
Proceeds from sale of property,
plant and equipment 11,313 2,800
Net cash used in
investing activities (367,923) (485,794)
Cash flows from financing activities:
Proceeds from issuance of long-term
debt - 240,000
Payments of long-term debt (213,850) (122,766)
Net cash used in
financing activities (213,850) 117,234
Net (decrease) increase in cash
and cash equivalents (440,889) (348,111)
Cash and cash equivalents,
beginning of period 1,391,666 1,536,958
Cash and cash equivalents,
end of period $ 950,777 $1,188,847
See accompanying notes to consolidated financial statements.
6
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
March 31, March 31,
2004 2003
Changes in certain working capital elements:
Accounts receivable, net $ (94,574) $ 447,205
Inventories (364,657) (595,957)
Prepaid expenses (193,051) 42,122
Accounts payable 108,113 (428,853)
Accrued payroll and related
taxes (91,079) (165,198)
Other accrued expenses 312,684 (94,940)
Income taxes payable (101,753) -
Net change $ (424,317) $ (795,621)
Supplemental cash flow information:
Cash paid during the first nine months:
Interest $ 30,389 $ 25,960
========== ==========
Income taxes $ 105,250 $ 193,247
========== ==========
7
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
1. Basis of Presentation: The consolidated financial statements included herein
have been prepared by the Company, without audit, in accordance with accounting
principals generally accepted in the United States of America and pursuant to
the rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with accounting principals generally accepted in the
United States of America have been condensed or omitted pursuant to such rules
and regulations, although the Company believes that the disclosures are adequate
to make the information presented not to be misleading. In the opinion of
management, the amounts shown reflect all adjustments necessary to present
fairly the financial position and results of operations for the periods
presented. All such adjustments are of a normal recurring nature.
It is suggested that the financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's Form 10-K
for the year ended June 30, 2003.
2. Discontinued operations:
In August 2003, due to continuing losses, the Company closed its Anton
Investments, Inc.'s ("Anton") Massachusetts location. In September 2003, the
Company closed its New Hampshire location. In December of 2003, the Company
reevaluated the business and determined to entirely close Anton because of
continuing decreased sales and an inability to generate sufficient revenues to
cover fixed costs and operating expenses. The Company has sold the remaining
inventory and fixed assets. Anton's operations have been accounted for as a
discontinued operation and the results of operations have been excluded from
continuing operations in the consolidated statements of operations for all
periods presented. The Company does not expect a loss on the disposition. The
fire/police segment has been renamed fire equipment and supplies.
3. Goodwill and Other Intangible Assets:
Following is a summary of the Company's amortizable intangible assets
relating to the Pharmacy segment at:
March 31, 2004 Amortization Accumulated
Period (years) Cost Amortization Net
Prescription lists 15 $ 528,000 $180,356 $347,644
Non-compete agreements 3-5 750,100 519,369 230,731
- - ------- ------- -------
Totals $1,278,100 $699,725 $578,375
========== ======== ========
8
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. Goodwill and Other Intangible Assets: continued,
June 30, 2003 Amortization Accumulated
Period (years) Cost Amortization Net
Prescription lists 15 $ 528,000 $ 154,274 $373,726
Non-compete agreements 3-5 750,100 457,545 292,555
- - ------- ------- -------
Totals $1,278,100 $ 611,819 $666,281
========== ========== ========
Aggregate amortization expense:
For the nine months ended March 31, 2004 $87,906
Estimated amortization for the years ending June 30: 2004 $ 117,208
2005 100,116
2006 83,449
2007 83,449
2008 71,449
4. Earnings per share
Basic earnings per share is computed by dividing income available to common
shareholders by the weighted-average number of common shares outstanding for the
period. Diluted earnings per share considers the potential dilution that could
occur if securities or other contracts to issue common stock were exercised or
converted into common stock or resulted in the issuance of common stock that
shared in the earnings of the entity. The effect on stock options for the three
months ended March 31, 2004 and 2003 were anti-dilutive due to losses in the
periods.
The following data show the amounts used in computing earnings per share
and the weighted average number of shares of diluted potential common stock:
Nine months ended
March 31,
2004 2003
---- ----
Weighted average number of common shares used
in basic EPS 3,784,962 3,756,962
Stock options 224,966 3,676
------- -----
Weighted average number of common shares used
in diluted EPS 4,009,928 3,760,638
========= =========
Certain options were not included in the computation of diluted earnings
per share because the exercise prices of these options were greater than the
average market price of the common shares and the options were therefore
anti-dilutive.
9
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5. Options and Warrants
Pro forma information, assuming the Company had accounted for its employee
and director stock options granted under the fair value method prescribed by
SFAS No. 123, as amended by Financial Accounting Standards Statement No. 148,
"Accounting for Stock Based Compensation - Transition and Disclosure, an
Amendment of FASB Statement No. 123", is presented below. The fair value of each
option grant is estimated on the date of each grant using the Black-Scholes
option-pricing model and amortized ratably over the option's vesting periods.
There were no stock options granted in the first quarter of fiscal 2004; there
were 12,000 options granted and 55,000 grants cancelled (1993 grants expired)
for the second quarter of fiscal 2004; there were 12,000 options granted for the
third quarter of fiscal 2004; no stock options were granted in the first quarter
of fiscal 2003; there were 770,000 options granted in the second quarter of
fiscal 2003 and no stock options were granted in the third quarter of fiscal
2003.
Three months ended Nine months ended
March 31, March 31,
2004 2003 2004 2003
Net (loss) income, as reported: $ (92,745) $ (65,069) $ 112,428 $ 183,949
Add: Total stock-based
compensation expense determined
under fair value based method
for all awards, net of taxes (8,607) (22,588) (34,921)
(1,241,601)
------ ------- ------- ----------
Pro forma net (loss) income $(101,352) $ (87,657) $ 77,507 (1,057,652)
========= ========= ========= ===========
Basic and diluted (loss) income per share:
As reported $(.03) $(.02) $.03 $ .05
===== ===== ==== =====
Pro forma $(.03) $(.02) $.02
$(.28)
===== ===== ==== =====
6. Business Segments: The Company had three active business segments for the
three months ended March 31, 2004 and 2003 and for the nine months ended
March 31, 2004 and 2003: (1) pharmacy chain ("pharmacies") (2) wholesale and
retail sales of surgical, medical equipment and supplies ("medical
equipment/supplies") and (3) wholesale distribution of equipment to fire
departments ("fire equipment/supplies"). Business segments are determined by
the management approach which analyses segments based on products or
services offered for sale. Corporate assets include assets of a discontinued
operation.
10
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FORM 10-Q NYER MEDICAL GROUP, INC 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
6. Business segments: continued,
Summary data for the three months ended March 31, 2004:
Medical Fire
Equipment/ Equipment/
Pharmacies Supplies Supplies Corporate Consolidated
Net sales $12,937,205 $ 2,048,735 $ 198,336 $ - $15,184,276
Operating
income (loss) 170,291 (153,525) (20,255) (198,613) (202,102)
Total assets 11,342,079 2,138,756 313,105 356,822 14,150,762
Depreciation
and amortization 110,330 19,391 3,130 202 133,053
Interest income (6,264) (3,684) - - (9,948)
Interest expense $ 5,591 $ 3,530 $ 176 $ - $ 9,297
Summary data for the nine months ended March 31, 2004:
Medical Fire
Equipment/ Equipment/
Pharmacies Supplies Supplies Corporate Consolidated
Net sales $39,729,103 $ 6,318,443 $ 838,344 $ - $46,885,890
Operating
income (loss) 989,659 (81,979) (44,074) (480,003) 383,603
Total assets 11,342,079 2,138,756 313,105 356,822 14,150,762
Depreciation
and amortization 311,795 60,063 10,117 606 382,581
Interest income (18,864) (14,731) - (1,745) (35,340)
Interest expense $ 20,000 $ 9,819 $ 1,521 $ - $ 31,340
Summary data for the three months ended March 31, 2003:
Medical Fire
Equipment/ Equipment/
Pharmacies Supplies Supplies Corporate Consolidated
Net sales $11,653,274 $ 2,298,748 $ 280,524 $ - $14,232,546
Operating
income (loss) 180,896 20,616 (18,267) (157,928) 25,317
Total assets 9,390,114 2,694,480 415,394 848,873 13,348,861
Depreciation
and amortization 79,919 15,341 2,934 360 98,554
Interest income (5,164) (4,778) - (716) (10,658)
Interest expense $ 3,556 $ 4,779 $ 616 $ - $ 8,951
11
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Business segments: continued,
Summary data for the nine months ended March 31, 2003:
Medical Fire
Equipment/ Equipment/
Pharmacies Supplies Supplies Corporate
Consolidated
Net sales $34,880,478 $ 7,015,013 $ 949,929 $ - $42,845,420
Operating
income (loss) 1,022,420 96,341 (67,203) (491,464) 560,094
Total assets 9,390,114 2,694,480 415,394 848,873 13,348,861
Depreciation
and amortization 234,189 59,262 10,391 1,164 305,006
Interest income (13,351) (14,403) - (5,961) (33,715)
Interest expense $ 11,249 $ 14,102 $ 1,440 $ - $ 26,791
12
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Results of Operations:
The following discussion provides information with respect to our results
of operations, liquidity, and capital resources on a comparative basis for the
nine months ended March 31, 2004 as compared to the nine months ended March 31,
2003 as well as for the three months ended March 31, 2004 as compared to the
three months ended March 31, 2003.
Net Sales:
Sales for the three months ended March 31, 2004 increased by 6.7% to
$15,184,276 from $14,232,546 for the three months ended March 31, 2003.
Sales for the nine months ended March 31, 2004 increased by 9.4% to
$46,885,890 from $42,845,420 for the nine months ended March 31, 2003.
The following table shows sales by business segment for the three months
ended March 31, 2004 as compared to the three months ended March 31, 2003 and
for the nine months ended March 31, 2004 as compared to the nine months ended
March 31, 2003:
Three months ended Nine months ended
March 31, % increase March 31, %increase
2004 2003 (decrease) 2004 2003
(decrease)
Pharmacies $12,937,205 $11,653,274 11.0% $39,729,103 $34,880,478 13.9%
Medical equipment/
supplies 2,048,735 2,298,748 (10.9) 6,318,443 7,015,013 (9.9)
Fire equipment/
supplies 198,336 280,524 (29.3) 838,344 949,929 11.7)
------- ------- ----- ------- ------- -----
Total $15,184,276 $14,232,546 6.7% $46,885,890 $42,845,420 9.4%
=========== =========== === =========== =========== ===
Pharmacies' sales increased by $1,283,931 to $12,937,205 or 11.0% for the
three months ended March 31, 2004 as compared to $11,653,274 for the same period
ended March 31, 2003 was due to the acquisition of one pharmacy in June 2003
which resulted in an increase of approximately $217,512 with the remainder due
to continued increases of prescription drug sales.
Pharmacies' sales increased by $4,848,625 for the nine months ended March
31, 2004 to $39,729,103 or 13.9% as compared to the same period ended March 31,
2003 of $34,880,478 are the same as mentioned above.
The pharmacies expect sales growth to continue to be strong in its core
business, but expect continued pressure on margins. In February 2004, the
pharmacies established a "closed-shop" operation in Peabody, Massachusetts to
service group homes and "Medicine on TimeTM" packaging system. This licensed
packaging system caters to elderly clients who are unable to manage their
medication regimens yet who are not frail enough for nursing home care. By
operating in this setting, the pharmacies expect to participate in
13
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Net Sales: continued,
manufacturer market-share rebate programs effectively partially mitigating the
effects of the reduction in payment by third party payors.
The pharmacies assisted two Federally Qualified Health Centers (FCHC's)
successfully complete grant applications with the Commonwealth of Massachusetts
to obtain funds for the establishment of pharmacies within the respective
clinics. The clinics will participate in the 340B drug program offering
significantly lower prices to the state's Medicaid program. The pharmacies
expect to effectuate contracts with both clinics to manage the pharmacy
operations on a fee for prescription dispensed basis.
Medical equipment/supplies' sales decreased $250,013 to $2,048,735 or 10.9%
for the three months ended March 31, 2004 as compared to the same period ended
March 31, 2003 of $2,298,748. This was mainly due to the discontinuing of
unprofitable items, increased competition from national and regional
competitors, and consolidation of medical practices.
Medical equipment/supplies' sales decreased $696,570 to $6,318,443 or 9.9%
for the nine months ended March 31, 2004 as compared to the same period ended
March 31, 2003 of $7,015,013. The reasons are as mentioned above.
Fire equipment/supplies' sales decreased $82,188 to $198,336 or 29.3% for
the three months ended March 31, 2004 as compared to the same period ended March
31, 2003 of $280,524. The decrease is due to lack of sales personnel.
Fire equipment/supplies' sales decreased by $111,585 to $838,344 or 11.7%
for the nine months ended March 31, 2004 as compared to the same period ended
March 31, 2003 of $949,929. The reasons are as mentioned above.
Gross Profit Margins:
Our overall gross margins for the three months ended March 31, 2004 were
21.6%, an increase of .1% for the same period ended March 31, 2003.
Our overall gross margins were 22% for the nine months ended March 31,
2004, an increase of .5% over the same period ended March 31, 2003.
14
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Gross Profit Margins: continued,
The following is a table of gross margins percentages by business segment for
the three months ended March 31, 2004 and 2003 and for the nine months ended
March 31, 2004 and 2003:
Three months ended Nine months ended
March 31, % increase March 31, % increase
2004 2003 (decrease) 2004 2003 (decrease)
---- ---- ---- ----
Pharmacies 20.6% 19.9% .7% 20.5% 20.1% .4%
Medical equipment/
supplies 27.7 28.9 (1.2) 31.2 28.3 2.9
Fire equipment/
supplies 20.7 24.6 (3.9) 23.1 22.3 .8
---- ---- ---- ---- ---- --
Total 21.6% 21.5% .1% 22.0% 21.5% .5%
==== ==== == ==== ==== ==
The pharmacies' gross margins increased .7% for the three months ended
March 31, 2004 to 20.6% as compared 19.9% for the same period ended March 31,
2003. The increase was due to increased sales, which increased purchase
discounts from suppliers. Another reason was an increase in generic
pharmaceutical sales which generally have higher gross profit margins as
compared to brand pharmaceutical sales.
The pharmacies' gross margins increased .4% for the first nine months ended
March 31, 2004 to 20.5% as compared 20.1% for the same period ended March 31,
2003. The reasons are as mentioned above.
The medical equipment/supplies' gross margins decreased 1.2% to 27.7% for
the three months ended March 31, 2004 as compared to 28.9% for the three months
ended March 31, 2003. The decrease in margins can be mainly attributed to
increased competition from cut rate competitors.
The medical equipment/supplies' gross margins increased 2.9% to 31.2% for
the nine months ended March 31, 2004 as compared to 28.3% for the nine months
ended March 31, 2003. This was due to a one time sale of merchandise acquired in
a discounted bulk purchase which was at no cost. The cost of the merchandise was
allocated to previously sold inventory. The impact on its gross profit margins
was approximately 5%.
The fire equipment/supplies' gross margins decreased to 20.7% or 3.9% for
the for the three months ended March 31, 2004 as compared to 24.6% for the same
period ended March 31, 2003. This segment had more equipment sales which are
generally have lower gross profit margins than supplies.
15
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Selling, General and Administrative Expenses: continued,
The fire equipment/supplies' gross margins increased to 23.1% or by .8% for
the nine months ended March 31, 2004 as compared to 22.3% for the same period
ended March 31, 2003. The increase in gross profit margins was due to a change
in the sales mix due to the incorporation of new inventory items received from a
closed location.
Selling, General and Administrative Expenses:
Consolidated selling, general and administrative expenses ("S,G & A")increased
$447,144 or 14.8% to $3,476,353 for the three months ended March 31, 2004, as
compared to $3,029,209 for the three months ended March 31, 2003. Consolidated
S,G & A expenses increased $1,293,513 or 15% to $9,925,572 for the nine months
ended March 31, 2004, as compared to $8,632,059 for the nine months ended March
31, 2003.
The following table shows the breakdown by business segment for the nine
months ended March 31, 2004 and 2003 and for the three months ended March 31,
2004 and 2003:
Three months ended Nine months ended
March 31, % increase March 31, %
increase
2004 2003 (decrease) 2004 2003
(decrease)
---- ---- ---- ----
Pharmacies $2,496,121 $2,141,409 16.6% $7,156,820 $5,973,519
19.8%
Medical equipment/
supplies 720,294 642,468 12.1 2,050,721 1,887,630
8.6
Fire equipment/
supplies 61,327 82,903 (26.0) 238,025 265,945
(10.5)
Corporate 198,611 162,429 22.3 480,006 504,965
(4.9)
------- ------- ---- ------- ------- -
- ---
Total $3,476,353 $3,029,209 14.8% $9,925,572 $8,632,059
15.0%
========== ========== ==== ========== ==========
====
The pharmacies' S,G & A expenses increased $354,712 to $2,496,121 or 16.6%
for the three months ended March 31, 2004 as compared to $2,141,409 for the
three months ended March 31, 2003. The increase was due to a combination of
factors which included the opening of an additional location and an increase in
salaries due to shortage of qualified personnel. Overhead associated with the
acquisition of an additional pharmacy was $105,458, increased labor costs were
approximately $255,000 of which $55,000 was due to a shortage of available
pharmacists, an increase in fringe benefits of $58,000, increased rent expense
of $26,000 and additional legal fees to renegotiate store leases of $17,000.
The pharmacies' S,G & A expenses increased $1,183,301 to $7,156,820 or
19.8% for the nine months ended March 31, 2004 as compared to $5,973,519 for the
nine months ended March 31, 2003. The increase was due to additional overhead
associated with the acquisition of two additional pharmacies of
16
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
of $431,088, increased labor costs of approximately $337,000 of which $275,350
was due to a shortage of available pharmacists, an increase in fringe benefits
of $130,500, increased rent expense of $81,000 and additional legal fees to
renegotiate store leases of $17,000. The pharmacies have increased their
advertising expenditures by $171,724 over the same period last year in an effort
to gain maximum exposure for the Eaton Apothecary brand name. This is part of a
plan to add additional locations with the Eaton Apothecary name.
The medical equipment/supplies' S,G&A expenses increased $77,826 or 12.1%
to $720,294 for the three months ended March 31, 2004 as compared to $642,468
for the three months ended March 31, 2003. The main increases are for increased
advertising of $46,000 and added sales personnel of $22,500 in an effort to
offset its sales decline.
The medical equipment/supplies' S,G & A expenses increased $163,091 or 8.6%
to $2,050,721 for the nine months ended March 31, 2004 as compared to $1,887,630
for the nine months ended March 31, 2003. The main increases are for advertising
of $113,100 and added sales personnel of $32,600 in an effort to offset its
sales decline.
The fire equipment/supplies' S,G&A expenses decreased $21,576 or 26.0% to
$61,327 for the three months ended March 31, 2004 as compared to $82,903 for the
three months ended March 31, 2003. This decrease was due to lower expenses
directly related to decreased sales.
The fire equipment/supplies' S,G&A expenses decreased $27,920 or 10.5% to
$238,025 for the nine months ended March 31, 2004 as compared to $265,945 for
the nine months ended March 31, 2003. The reason is mentioned above.
Corporate overhead increased $36,182 or 22.3% to $198,611 for the three
months ended March 31, 2004 as compared to $162,429 for the three months ended
March 31, 2003. Corporate overhead increased due to additional accounting and
audit committee fees of approximately $41,400 due to additional work required by
the Sarbanes-Oxley Act of 2002.
Corporate overhead decreased $24,959 or 4.9% to $480,006 for the nine
months ended March 31, 2004 as compared to $504,965 for the nine months ended
March 31, 2003, due to lower legal expenses. The reason is mentioned above.
17
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Interest income:
The following table shows the breakdown of interest income by business
segment for the three months ended March 31, 2004 and 2003 and for the nine
months ended March 31, 2004 and 2003:
Three months ended Nine months ended
March 31, % increase March 31, % increase
2004 2003 (decrease) 2004 2003 (decrease)
---- ---- ---- ----
Pharmacies $ 6,264 $ 5,164 21.3% $ 18,864 $ 13,351 41.3%
Medical equipment/
supplies 3,684 4,778 (22.9) 14,731 14,403 2.3
Corporate - 716 (100.0) 1,745 5,961 (70.7)
----- --- ------ ----- ----- -----
Total $ 9,948 $ 10,658 (6.7)% $ 35,340 $ 33,715 4.8%
======== ======== ==== ======== ======== ===
The pharmacies' interest income increased $1,100 or 21.3% to $6,264 for the
three months ended March 31, 2004 as compared to $5,164 for the three months
ended March 31, 2003, due to increased accounts receivable interest.
The pharmacies' interest income increased $5,513 or 41.3% to $18,864 for
the nine months ended March 31, 2004 as compared to $13,351 for the nine months
ended March 31, 2003. The reason is mentioned above.
The medical equipment/supplies' interest income decreased $1,094 or 22.9% to
$3,684 for the three months ended March 31, 2004 as compared to $4,778 for the
three months ended March 31, 2003. This decrease is from lower accounts
receivable balances.
The medical equipment/supplies' interest income increased $328 or 2.3% to
$14,731 for the nine months ended March 31, 2004 as compared to $14,403 for the
nine months ended March 31, 2003.
Corporate interest income decreased $716 or 100% to $0 for the three months
ended March 31, 2004 as compared to $716 for the three months ended March 31,
2003. This decrease is due to a decline in cash.
Corporate interest income decreased $4,216 or 70.7% to $1,745 for the nine
months ended March 31, 2004 as compared to $5,961 for the nine months ended
March 31, 2003. The reason is mentioned above.
18
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Interest expense:
The following table shows the breakdown of interest expense by business
segment for the three months ended March 31, 2004 and 2003 and for the nine
months ended March 31, 2004 and 2003:
Three months ended Nine months ended
March 31, % increase March 31, % increase
2004 2003 (decrease) 2004 2003 (decrease)
---- ---- ---- ----
Pharmacies $ 5,591 $ 3,556 57.2% $ 20,000 $ 11,249 77.8%
Medical equipment/
supplies 3,530 4,779 (26.1) 9,819 14,102 (30.4)
Fire equipment/
supplies 176 616 (71.4) 1,521 1,440 5.6
--- --- ----- ----- ----- ---
Total $ 9,297 $ 8,951 3.9% $ 31,340 $ 26,791 17.0%
======== ======== === ======== ======== ====
The pharmacies' interest expense increased $2,035 or 57.2% to $5,591 for
the three months ended March 31, 2004 as compared to $3,556 for the three months
ended March 31, 2003, due to debt associated with the purchase of two
pharmacies.
The pharmacies' interest expense increased $8,751 or 77.8% to $20,000 for
the nine months ended March 31, 2004 as compared to $11,249 for the nine months
ended March 31, 2003. The reason is mentioned above.
The medical equipment/supplies' interest expense decreased $1,249 or 26.1%
to $3,530 for the three months ended March 31, 2004 as compared to $4,779 for
the three months ended March 31, 2003. This was due to pay down on its building
mortgage.
The medical equipment/supplies' interest expense decreased $4,283 or 30.4%
to $9,819 for the nine months ended March 31, 2004 as compared to $14,102 for
the nine months ended March 31, 2003. The reason is mentioned above.
The fire equipment/supplies' interest expense decreased $440 or 71.4% to
$176 for the three months ended March 31, 2004 as compared to $616 for the three
months ended March 31, 2003. This slight decrease is lower credit card interest.
The fire equipment/supplies' interest expense increased $81 or 5.6% to
$1,521 for the nine months ended March 31, 2004 as compared to $1,440 for the
nine months ended March 31, 2003 because of credit card interest.
19
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Minority interest:
The following table shows the breakdown of minority interest which
predominately represents the 20% minority interest in the pharmacies for the
three months ended March 31, 2004 and 2003 and for the nine months ended March
31, 2004 and 2003:
Three months ended Nine months ended
March 31, March 31,
2004 2003 2004 2003
---- ---- ---- ----
Pharmacies $ 24,372 $ 28,281 $ 114,711 $ 168,091
Fire equipment/
supplies (77) (18) (65) (213)
--- --- --- ----
Total $ 24,295 $ 28,263 $ 114,646 $ 167,878
========= ========= ========= =========
Income tax expense:
The following table shows the breakdown of income tax expense by business
segment for the three months ended March 31, 2004 and 2003 and for the nine
months ended March 31, 2004 and 2003:
Three months ended Nine months ended
March 31, March 31,
2004 2003 2004 2003
---- ---- ---- ----
Pharmacies $ 81,870 $ 10,800 $ 383,000 $ 90,800
Medical equipment/
supplies (79,900) - (32,700) -
Fire equipment/
supplies (9,510) - (25,000) -
Corporate (64,345) - (145,000) -
------- ------ -------- -------
Total $ (71,885) $ 10,800 $ 180,300 $ 90,800
========= ========= ========= =========
In fiscal 2003, the Company had federal and state income tax provisions
whereas in fiscal 2003, there were only state income tax provisions.
Discontinued operations:
In August 2003, due to continuing losses, the Company closed its Anton
Investments, Inc.'s ("Anton") Massachusetts location. In September 2003, the
Company closed and its New Hampshire location. In December 2003, the Company
reevaluated the business and determined to entirely close Anton and discontinue
the remaining location because of continuing decreased sales and an inability to
generate sufficient revenues to cover fixed costs and operating expenses. The
Company has sold the remaining inventory and fixed assets. Anton's
20
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Discontinued operations: continued,
operations have been accounted for as a discontinued operation and the results
of operations have been excluded from continuing operations in the consolidated
statements of operations for all periods presented. The Company does not expect
a loss on the disposition of the component.
The following table shows a comparison of sales, gross profit margins, S, G
& A expenses, interest expense, interest income and income taxes for the three
months ended March 31, 2004 and 2003 and for the nine months ended March 31,
2004 and 2003:
Three months ended Nine months ended
March 31, March 31,
2004 2003 2004 2003
---- ---- ---- ----
Sales $ 8,000 $ 380,235 $ 420,194 $1,304,303
Gross profit margin 410.9% 21.1% 36.4% 21.9%
S, G & A expenses 20,834 135,493 193,274 406,702
Interest expense - - 9,055 -
Interest income - - - 7
Income taxes $ 444 $ - $ (20,200) $ -
Liquidity and Capital Resources
Net cash provided by operating activities was $140,844 for the nine months
ended March 31, 2004 as compared to $20,449 for the same period ended March 31,
2003.
The net cash used in investing activities was $367,923 and $485,794, for
the nine months ended March 31, 2004 and 2003, respectively.
Net cash used in financing activities was $213,850 for nine months ended
March 31, 2004 as compared to $117,234 cash provided for financing activities
for the same period in 2003.
At March 31, 2004, we had $950,777 in cash on a consolidated basis.
Approximately $206,400 was held by the parent company and approximately $696,500
was held by the pharmacies. Since the pharmacies are not a wholly-owned
subsidiary of the Company, the Company does not have complete control over it,
and, therefore, cannot unilaterally cause the pharmacies to lend funds to the
Company, if the Company should need such a loan.
Approximately $422,500 is owed to the Company by the pharmacies as an
inter-company loan. The Company has structured a repayment schedule.
21
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, continued,
Results of Operations: continued,
Liquidity and Capital Resources: continued,
Management believes that with such structuring the Company's current cash
resources would be adequate to fund its current operating needs for the next 12
months.
Our primary source of liquidity is cash provided from operations. Our
principal uses of cash are: operations, capital expenditures and repayment of
debt.
During the nine months ended March 31, 2004, we had a decrease in cash due
to the funding the losses of our medical equipment/supplies, fire
equipment/supplies, discontinued operations and corporate expenses.
At March 31, 2004, we had accounts receivable of approximately $4.5 million.
Although our sales have increased, our accounts receivables have remained
relatively the same because of declining sales in the medical equipment/supplies
and fire equipment/supplies.
We had $496,060 of debt as of March 31, 2004. Our debt has decreased due to pay
down of the debt with no additional borrowing for the nine months. Because of
our cash balances, we have not needed to borrow to fund operations.
The Company also has the ability to borrow based upon its assets to obtain
additional working capital. In addition, if it becomes necessary, the Company
may seek additional capital in the private and/or public equity markets to
sustain its operations. We cannot assure you that additional funds will be
available in adequate amounts or on acceptable terms. If funds are needed but
not available, our business would be harmed.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We do not have any material risk with respect to changes in foreign
currency exchange rates, commodities prices or interest rates. We do not believe
that we have any other relevant market risk with respect to the categories
intended to be discussed in this item of this report.
Item 4. Controls and Procedures
The Company's management evaluated, with the participation of its principal
executive officer and principal financial officer, the effectiveness of its
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934) as of the end of the period covered
by this report. Based on such evaluation, the principal executive officer and
the principal financial officer of the Company concluded that its disclosure
controls and procedures are designed to ensure that information required to be
disclosed by the Company in the reports that it files or submits under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the
22
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
Item 4. Controls and Procedures: continued,
rules and regulations of the Securities and Exchange Commission and are
operating in an effective manner.
No change in the Company's internal control over financial reporting (as
defined in Rules 13a-15(f) and 15(d)-15(f) under the Securities Exchange Act of
1934) occurred during the most recent fiscal quarter that has materially
affected, or is reasonably likely to materially affect, its internal control
over financial reporting.
PART II
Item 1. Legal Proceedings None
Item 2. Changes in Securities, Use of Proceeds and Issuer
Purchases of Equity Securities
The foregoing equity repurchases by the Company during the fiscal quarter
ended March 31, 2004 have been reflected as follows:
ISSUER PURCHASES OF EQUITY SHARES
(d)Maximum Number
(or)
Approximate
c) Total Number of Dollar Value)of
Shares Purchased as Shares that May
Part of Publicly Yet Be Purchased
(a)Total Number of (b)Average Price Announced Plans or Under the Plans or
Shares Purchased Paid Per Share Programs Programs
January 1-31, 2004 0 $ - 0 148,000
February 1-29, 2004 0 $ - 0 148,000
March 1-31, 2004 0 $ - 0 148,000
On May 12, 2003, the Company announced that the Board of Directors of the
Company had authorized the repurchase of up to 150,000 shares of the Company's
outstanding common stock from time-to-time in open market transactions at
prevailing market prices. There was no expiration date established for this
repurchase plan. As of the date of this report, the plan has not been
terminated.
Item 3. Defaults upon Senior Securities None
Item 4. Submissions of Matters to Vote of Security Holders None
Item 5. Other information
The Company is still actively seeking to acquire medical related companies.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 31.1 Certification Pursuant to Rules 13a-14(a) and 15d-14(a) of the
Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of
2002 by Principal Executive Officer
23
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
PART II
Item 6. Exhibits and Reports on Form 8-K: continued,
Exhibit 31.2 Certification Pursuant to Rules 13a-14(a) and 15d-14(a) of the
Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of
2002 by Principal Financial and Accounting Officer
Exhibit 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Chief Executive
Officer
Exhibit 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Chief Financial
Officer
(b) Reports on Form 8-K
An 8-K was filed on March 18, 2004 in order to have a comprehensive description
of the Company's securities set forth in a filing under the Securities Exchange
Act of 1934 that is electronically accessible. This filing does not reflect any
change to the rights, privileges or preferences of Nyer Medical's common or
preferred stock or other securities. An amendment to this Form 8-K was filed on
May 4, 2004 to add sections which were inadvertently omitted.
24
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FORM 10-Q NYER MEDICAL GROUP, INC. 000-20175 MARCH 31, 2004
NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
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.
NYER MEDICAL GROUP, INC.
Date: May 17, 2004 /s/ Samuel Nyer
Samuel Nyer,
Chief Executive Officer
and Principal Executive
Officer
Date: May 17, 2004 /s/ Karen L. Wright
Karen L. Wright,
Chief Financial Officer
and Principal Financial
and Accounting Officer
25
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EXHIBIT 31.1
CERTIFICATION PURSUANT TO RULES 13a-14(a) AND 15d-14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 AND SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Samuel
Nyer, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Nyer Medical
Group, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered
by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
(c) Disclosed in this report any change in the registrant's internal control
over financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based
on our most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
Date: May 17, 2004
/s/ Samuel Nyer
Samuel Nyer, President (Principal Executive Officer)
26
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EXHIBIT 31.2
CERTIFICATION PURSUANT TO RULES 13a-14(a) AND 15d-14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 AND SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Karen
L. Wright, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Nyer Medical
Group, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered
by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
report is being prepared;
(b) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and
(c) Disclosed in this report any change in the registrant's internal control
over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the
case of an annual report) that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over
financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based
on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):
(a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
control over financial reporting.
Date: May 17, 2004
/s/ Karen L. Wright
Karen L. Wright
Vice President - Finance (Principal Financial and Accounting Officer)
27
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NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
2004 Quarterly Report on Form 10-Q
Exhibit 32.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Nyer Medical Group, Inc. (the
"Company") on Form 10-Q for the Quarter ended March 31, 2004, as filed with the
Securities and Exchange Commission on the date hereof (the "Report"),
I, Samuel Nyer, Chief Executive Officer of the Company, certify, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that to the best of my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
/s/ Samuel Nyer
Samuel Nyer
Chief Executive Officer
May 17, 2004
28
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NYER MEDICAL GROUP, INC. AND SUBSIDIARIES
2004 Quarterly Report on Form 10-Q
Exhibit 32.2
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Nyer Medical Group, Inc. (the
"Company") on Form 10-Q for the quarter ended March 31, 2004, as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Karen
L. Wright, Chief Financial Officer of the Company, certify, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that to the best of my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
/s/ Karen L. Wright
Karen L. Wright
Chief Financial Officer
May 17, 2004
29
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