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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
X Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
- --- Act of 1934
For the quarterly period ended September 30, 2002
_____ Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Action of 1934
For the transition period from ___ to ___
Commission File Number 0-19266
ALLIED HEALTHCARE PRODUCTS, INC.
1720 Sublette Avenue
St. Louis, Missouri 63110
314/771-2400
IRS Employment ID 25-1370721
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 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 ninety days.
Yes X No
--- ---
The number of shares of common stock outstanding at November 14, 2002
is 7,813,932 shares
INDEX
Page
Number
------
Part I - Financial Information
Item 1. Financial Statements
Consolidated Statement of Operations - 3
three months ended September 30,
2002 and 2001 (Unaudited)
Consolidated Balance Sheet - 4 - 5
September 30, 2002 (Unaudited) and
June 30, 2002 (Unaudited)
Consolidated Statement of Cash Flows - 6
Three months ended September 30, 2002 and 2001
(Unaudited)
Notes to Consolidated Financial Statements 7 - 9
Item 2. Management's Discussion and Analysis of 10 - 12
Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosure 12
about Market Risk
Item 4. Controls and Procedures 13
Part II - Other Information
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures & Certification 14 - 18
SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
Statements contained in this Report, which are not historical facts or
information, are "forward-looking statements." Words such as "believe,"
"expect," "intend," "will," "should," and other expressions that indicate future
events and trends identify such forward-looking statements. These
forward-looking statements involve risks and uncertainties, which could cause
the outcome and future results of operations, and financial condition to be
materially different than stated or anticipated based on the forward-looking
statements. Such risks and uncertainties include both general economic risks and
uncertainties, risks and uncertainties affecting the demand for and economic
factors affecting the delivery of health care services, and specific matters
which relate directly to the Company's operations and properties as discussed
the Company's annual report on Form 10-K for the year ended June 30, 2002. The
Company cautions that any forward-looking statements contained in this report
reflects only the belief of the Company or its management at the time the
statement was made. Although the Company believes such forward-looking
statements are based upon reasonable assumptions, such assumptions may
ultimately prove inaccurate or incomplete. The Company undertakes no obligation
to update any forward-looking statement to reflect events or circumstances after
the date on which the statement was made.
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ALLIED HEALTHCARE PRODUCTS, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED
SEPTEMBER 30,
-------------------------------
2002 2001
---------- ----------
Net sales $15,240,671 $14,145,711
Cost of sales 12,056,992 11,315,036
---------- ----------
Gross profit 3,183,679 2,830,675
Selling, general and administrative expenses 3,323,444 3,362,979
---------- ----------
Loss from operations (139,765) (532,304)
Other expenses:
Interest 223,934 301,593
Other, net 12,544 16,247
---------- ----------
236,478 317,840
---------- ----------
Loss before benefit for income taxes (376,243) (850,144)
Benefit for income taxes (135,845) (340,058)
---------- ----------
Net loss ($240,398) ($510,086)
========== ==========
Basic and diluted loss per share ($0.03) ($0.07)
========== ==========
Weighted average shares outstanding - basic and diluted 7,813,932 7,806,682
See accompanying Notes to Consolidated Financial Statements.
3
ALLIED HEALTHCARE PRODUCTS, INC.
CONSOLIDATED BALANCE SHEET
ASSETS
(UNAUDITED)
SEPTEMBER 30, JUNE 30,
2002 2002
----------- -----------
Current assets:
Cash $ 7,294 $ 800
Accounts receivable, net of allowance for doubtful
accounts of $450,000 and $450,000, respectively 8,195,598 8,524,187
Inventories, net 13,348,542 13,200,921
Deferred income taxes 745,910 745,910
Income tax receivable 745,895 745,895
Other current assets 435,591 163,510
----------- -----------
Total current assets 23,478,830 23,381,223
----------- -----------
Property, plant and equipment, net 13,039,130 13,228,157
Deferred income taxes 100,492 100,492
Goodwill, net 15,979,830 15,979,830
Other assets, net 168,949 180,536
----------- -----------
Total assets $52,767,231 $52,870,238
=========== ===========
See accompanying Notes to Consolidated Financial Statements.
(CONTINUED)
4
ALLIED HEALTHCARE PRODUCTS, INC.
CONSOLIDATED BALANCE SHEET
(CONTINUED)
LIABILITIES AND STOCKHOLDERS' EQUITY
(UNAUDITED)
SEPTEMBER 30, JUNE 30,
2002 2002
------------ ------------
Current liabilities:
Accounts payable $ 2,599,481 $ 3,426,802
Current portion of long-term debt 8,604,458 7,985,406
Other current liabilities 2,630,202 2,598,140
------------ ------------
Total current liabilities 13,834,141 14,010,348
------------ ------------
Long-term debt 4,448,754 4,135,156
------------ ------------
Commitments and contingencies
Stockholders' equity:
Preferred stock; $0.01 par value; 1,500,000 shares
authorized; no shares issued and outstanding; which
includes Series A preferred stock; $0.01 par value; 200,000
shares authorized; no shares issued and outstanding
Common stock; $0.01 par value; 30,000,000 shares
authorized; 7,813,932 and 7,813,932 shares
issued and outstanding at September 30, 2002,
and June 30, 2002, respectively 101,175 101,175
Additional paid-in capital 47,030,549 47,030,549
Common stock in treasury, at cost (20,731,428) (20,731,428)
Retained earnings 8,084,040 8,324,438
------------ ------------
Total stockholders' equity 34,484,336 34,724,734
------------ ------------
Total liabilities and stockholders' equity $ 52,767,231 $ 52,870,238
============ ============
See accompanying Notes to Consolidated Financial Statements.
5
ALLIED HEALTHCARE PRODUCTS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
THREE MONTHS ENDED
September 30,
-------------------------------------
2002 2001
------------ ------------
Cash flows from operating activities:
Net loss ($ 240,398) ($ 510,086)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 359,454 511,333
Changes in operating assets and liabilities:
Accounts receivable, net 328,589 1,812,854
Inventories, net (147,621) (118,369)
Other current assets (272,081) 134,475
Accounts payable (827,321) (1,400,151)
Other current liabilities 32,062 (770,698)
------------ ------------
Net cash used in operating activities (767,316) (340,642)
------------ ------------
Cash flows from investing activities:
Capital expenditures (158,840) (338,518)
------------ ------------
Net cash used in investing activities (158,840) (338,518)
------------ ------------
Cash flows from financing activities:
Payments of capital lease obligations (115,455) (17,284)
Payments of long-term debt (110,735) (104,154)
Borrowings under revolving credit agreement 16,819,035 16,927,000
Payments under revolving credit agreement (15,660,195) (16,106,948)
------------ ------------
Net cash provided by financing activities 932,650 698,614
------------ ------------
Net increase in cash and equivalents 6,494 19,454
Cash and equivalents at beginning of period 800 20,365
------------ ------------
Cash and equivalents at end of period $ 7,294 $ 39,819
============ ============
See accompanying Notes to Consolidated Financial Statements.
6
ALLIED HEALTHCARE PRODUCTS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. Unaudited Consolidated Financial Statements
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions for Form 10-Q and do not include
all of the information and disclosures required by accounting principles
generally accepted in the United States of America for complete financial
statements. In the opinion of management, all adjustments, consisting only of
normal recurring adjustments considered necessary for a fair presentation, have
been included. Operating results for any quarter are not necessarily indicative
of the results for any other quarter or for the full year. These statements
should be read in conjunction with the consolidated financial statements and
notes to the consolidated financial statements thereto included in the Company's
Form 10-K for the year ended June 30, 2002.
2. Inventories
Inventories are comprised as follows (Unaudited):
SEPTEMBER 30, 2002 JUNE 30, 2002
------------------ -------------
Work-in progress $ 886,477 $ 541,855
Component Parts 12,706,839 13,176,743
Finished Goods 4,190,458 4,294,397
Reserve for obsolete and excess
inventory (4,435,232) (4,812,074)
------------ ------------
$ 13,348,542 $ 13,200,921
============ ============
3. Earnings per share
Basic earnings per share are based on the weighted average number of
shares of all common stock outstanding during the period. Diluted earnings per
share are based on the sum of the weighted average number of shares of common
stock and common stock equivalents outstanding during the year. The number of
basic and diluted shares outstanding for the three months ended September 30,
2002 and 2001 was 7,813,932 and 7,806,682 shares, respectively.
4. New Accounting Standards
In August 2001, the FASB issued Statement of Financial Accounting
Standard No. 144 (SFAS 144), "Accounting for the Impairment or Disposal of
Long-Lived Assets"
7
which supercedes Statement of Financial Accounting Standards No. 121 (SFAS 121),
"Accounting for the Impairment of Long-Lived Assets to be Disposed Of" and the
accounting and reporting provisions of APB No. 30, "Reporting the Results of
Operations - Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions", for
the disposal of a business. SFAS 144 provides a single accounting model for
long-lived assets to be disposed of. Although retaining many of the fundamental
recognition and measurement provisions of SFAS 121, the new rules change the
criteria to be met to classify an asset as held-for-sale. The new rules also
broaden the criteria regarding classification of a discontinued operation. The
Company was required to adopt the provisions of SFAS 144 effective July 1, 2002.
Adoption of SFAS 144 is not expected to have a material impact on the Company's
results of operations, financial position or cash flows.
In July 2002, the FASB issued Statement of Financial Accounting
Standards No. 146 (SFAS 146), "Accounting for Cost Associated with Exit or
Disposal Activities" which addresses financial accounting and reporting for
costs associated with exit or disposal activities and nullifies Emerging Issues
Task Force (EITF) Issue No. 94-3, "Liability Recognition for Certain Employee
Termination Benefits and Other Cost to Exit an Activity (including Certain Cost
Incurred in a Restructuring)." SFAS 146 requires that a liability for a cost
associated with an exit of disposal activity be recognized when the liability is
incurred. Under EITF Issue No. 94-3, a liability for an exit cost was recognized
when the liability is incurred. Under EITF Issue No. 94-3, a liability for an
exit cost was recognized at the date of an entity's commitment to an exit plan.
The provisions of SFAS 146 are effective for exit or disposal activities
initiated after December 31, 2002. Adoption of SFAS 146 is not expected to have
a material impact on the Company's results of operations, financial position or
cash flows.
5. Commitments and Contingencies
The Company is subject to various investigations, claims and legal
proceedings covering a wide range of matters that arise in the ordinary course
of its business activities. The Company has recognized the costs and associated
liabilities only for those investigations, claims and legal proceedings for
which, in its view, it is probable that liabilities have been incurred and the
related amounts are estimable. Based upon information currently available,
management believes that existing accrued liabilities are sufficient and that it
is not reasonably possible at this time to believe that any additional
liabilities will result from the resolution of these matters that would have a
material adverse effect on the Company's consolidated results of operations,
financial position or cash flows.
6. Financing Agreement Amendment
On April 24, 2002, the Company entered into a new credit facility
arrangement with LaSalle Bank National Association (the "Bank"). The credit
facility provides for borrowings up to $19.0 million; up to $15.0 million
through a revolving credit facility and
8
up to $4.0 million under a term loan. The term loan may be drawn against for
capital expenditures during the first six months of the term of the credit
facility.
On September 26, 2002, the Bank amended the Company's credit facility
(the amended credit facility). The Bank amended various financial covenants in
conjunction with the amended credit facility to include a quarterly fixed
coverage charge ratio and EBITDA ratio through June 30, 2003, which are adjusted
to measurement on an annual basis beginning on July 1, 2003. At September 30,
2002, the Company was in compliance with its financial covenants under the
amended credit facility. In addition, the outstanding loans under the amended
credit facility will bear interest at an annual interest rate of 0.75% plus the
Bank's prime rate and the Company will no longer have an option to elect a LIBOR
rate of interest for its outstanding borrowings. The Company's per annum fee on
any outstanding letters of credit under the amended credit facility will be
2.50%. Under the terms of the amended credit facility, the interest rate on each
loan outstanding at an Event of Default, as defined in the amended credit
facility, will bear interest at the rate of 2.00% per annum in excess of the
interest rate otherwise payable thereon and interest payments will be payable on
demand. The borrowing period under the term loan for capital expenditures, which
represent 80% of the purchase price of the related equipment, has been extended
to eight months from the date of the original credit facility.
The Company's credit facility requires a lockbox arrangement, which
provides for all receipts to be swept daily to reduce borrowings outstanding
under the credit facility. This arrangement, combined with the existence of a
Material Adverse Effect (MAE) clause in the new credit facility, cause the
revolving credit facility to be classified as a current liability, per guidance
in the FASB's Emerging Issues Task Force Issue 95-22, "Balance Sheet
Classification of Borrowings Outstanding under Revolving Credit Agreements that
Include Both a Subjective Acceleration Clause and a Lock-Box Arrangement."
However, the Company does not expect to repay, or be required to repay, within
one year, the balance of the revolving credit facility classified as a current
liability. The MAE clause, which is a typical requirement in commercial credit
agreements, allows the lender to require the loan to become due if it determines
there has been a material adverse effect on the Company's operations, business,
properties, assets, liabilities , condition or prospects. The classification of
the revolving credit facility as a current liability is a result only of the
combination of the two aforementioned factors: the lockbox arrangement and the
MAE clause. However, the revolving credit facility does not expire or have a
maturity date within one year, but rather has a final expiration date of April
25, 2005. Additionally, the Bank has not notified the Company of any indication
of a MAE at September 30, 2002.
9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 2002 COMPARED TO THREE MONTHS ENDED SEPTEMBER
30, 2001.
Allied had net sales of $15.2 million for the three months ended
September 30, 2002, up $1.1 million, or 7.7%, from net sales of $14.1 million in
the prior year same quarter. The increase in sales is primarily a result of
increased shipments resulting from improvements in production performance from
the prior year. Sales in the first quarter of the prior year were also impacted
by a delay in orders released for shipment following the events of September 11,
2001.
Gross profit for the three months ended September 30, 2002 was $3.2
million, or 20.9% of net sales compared to $2.8 million, or 20.0% of net sales
for the three months ended September 30, 2001. The Company is continuing to
review and improve operations to improve productivity and lower manufacturing
and product cost.
Selling, general and administrative expenses for the three months ended
September 30, 2002 were $3.3 million, a net decrease of $0.1 million, or 1.2%,
from $3.4 million for the three months ended September 30, 2001. This decrease
is attributable to a $0.1 million reduction in lease amortization on the
Company's computer systems, a $0.1 million reduction in payments to outside
consultants, and a $0.1 million reduction in other selling, general and
administrative expenses. However, these savings were largely offset by a $0.2
million dollar increase in insurance cost. This increase in insurance cost is
the result of price increases in the insurance market, and product liability
claims experienced by the Company in prior years.
Loss from operations was $0.1 million for the three months ended
September 30, 2002 compared to a $0.5 million loss for the three months ended
September 30, 2001. Interest expense was $0.2 million for the three months ended
September 30, 2002 compared to $0.3 million for the three months ended September
30, 2001. Allied had a loss before benefit for income taxes in the first quarter
of fiscal 2002 of $0.4 million compared to a loss before benefit for income
taxes of $0.9 million for the first quarter of fiscal 2001. The Company recorded
a tax benefit of $0.1 million and $0.3 million for the three-month periods ended
September 30, 2002 and 2001, respectively.
In fiscal 2003, the net loss for the first quarter was $0.2 million, or
$0.03 per basic and diluted share compared to a net loss of $0.5 million or
$0.07 per basic and diluted share for the first quarter of fiscal 2002. The
weighted average number of common shares outstanding used in the calculation of
basic and diluted earnings per share for the first quarters of fiscal 2003 and
fiscal 2002 was 7,813,932 and 7,806,682 shares, respectively.
10
LIQUIDITY AND CAPITAL RESOURCES
The Company believes that available resources and anticipated cash
flows from operations are sufficient to meet operating requirements in the
coming year.
Working capital increased to $9.6 million at September 30, 2002
compared to $9.4 million at June 30, 2002. The increase was primarily due to a
decrease in accounts payable, partially offset by an increase in the current
portion of long-term debt.
On April 24, 2002, the Company entered into a new credit facility
arrangement with LaSalle Bank National Association (the "Bank"). The credit
facility provides for borrowings up to $19.0 million; up to $15.0 million
through a revolving credit facility and up to $4.0 million under a term loan.
The term loan may be drawn against for capital expenditures during the first six
months of the term of the credit facility.
On September 26, 2002, the Bank amended the Company's credit facility
(the amended credit facility). The Bank amended various financial covenants in
conjunction with the amended credit facility to include a quarterly fixed
coverage charge ratio and EBITDA ratio through June 30, 2003, which are adjusted
to measurement on an annual basis beginning on July 1, 2003. At September 30,
2002, the Company was in compliance with its financial covenants under the
amended credit facility. In addition, the outstanding loans under the amended
credit facility will bear interest at an annual interest rate of 0.75% plus the
Bank's prime rate and the Company will no longer have an option to elect a LIBOR
rate of interest for its outstanding borrowings. The Company's per annum fee on
any outstanding letters of credit under the amended credit facility will be
2.50%. Under the terms of the amended credit facility, the interest rate on each
loan outstanding at an Event of Default, as defined in the amended credit
facility, will bear interest at the rate of 2.00% per annum in excess of the
interest rate otherwise payable thereon and interest payments will be payable on
demand. The borrowing period under the term loan for capital expenditures, which
represent 80% of the purchase price of the related equipment, has been extended
to eight months from the date of the original credit facility.
The Company's credit facility requires a lockbox arrangement, which
provides for all receipts to be swept daily to reduce borrowings outstanding
under the credit facility. This arrangement, combined with the existence of a
Material Adverse Effect (MAE) clause in the new credit facility, cause the
revolving credit facility to be classified as a current liability, per guidance
in the FASB's Emerging Issues Task Force Issue 95-22, "Balance Sheet
Classification of Borrowings Outstanding under Revolving Credit Agreements that
Include Both a Subjective Acceleration Clause and a Lock-Box Arrangement."
However, the Company does not expect to repay, or be required to repay, within
one year, the balance of the revolving credit facility classified as a current
liability. The MAE clause, which is a typical requirement in commercial credit
agreements, allows the lender to require the loan to become due if it determines
there has been a material adverse effect on the Company's operations, business,
properties, assets, liabilities , condition or prospects. The classification of
the revolving credit facility as a current liability is a result only of the
combination of the two aforementioned factors: the lockbox
11
arrangement and the MAE clause. However, the revolving credit facility does not
expire or have a maturity date within one year, but rather has a final
expiration date of April 25, 2005. Additionally, the Bank has not notified the
Company of any indication of a MAE at September 30, 2002.
At September 30, 2002, $9.6 million was outstanding against this
facility and $4.2 million was available to borrow from the line based on
collateral requirements.
Inflation has not had a material effect on the Company's business or
results of operations.
LITIGATION AND CONTINGENCIES
The Company becomes, from time to time, a party to personal injury
litigation arising out of incidents involving the use of its products. More
specifically there have been a number of lawsuits filed against the Company
alleging that its aluminum oxygen pressure regulator, marketed under its Life
Support Products label, has caused fires that have led to personal injury. The
Company believes, based on preliminary findings, that its products did not cause
the fires. The Company intends to defend these claims in cooperation with its
insurers. Based on the progression of certain cases, the Company has recorded
additional charges to operations during fiscal 2003 and 2002 for amounts
estimated to be payable by the Company under its self-insurance retention for
legal costs associated with defending these claims. The Company believes that
any potential judgements resulting from these claims over its self-insured
retention will be covered by the Company's product liability insurance.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
At September 30, 2002, the Company had $13.0 million in debt
outstanding, excluding capital leases, of which $3.4 million is a short term
loan with a fixed interest rate of 7.75%. The remaining balance represents
amounts outstanding under the Company's revolving credit facility of $7.9
million and the Company's capital expenditure loan for $1.7 million. The
revolving credit facility and capital expenditure loan bear an interest rate
using the commercial bank's "floating reference rate" as the basis, as defined
in the loan agreement, and therefore is subject to additional expense should
there be an increase in market interest rates.
The Company had no holdings of derivative financial or commodity
instruments at September 30, 2002. Allied Healthcare Products has international
sales, however these sales are denominated in U.S. dollars, mitigating foreign
exchange rate fluctuation risk.
12
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Within the 90 day period prior to the filing date of this Quarterly
Report on Form 10-Q, the Company, under the supervision, and with the
participation, of its management, including its principal executive officer and
principal financial officer, performed an evaluation of the Company's disclosure
controls and procedures, as contemplated by Securities Exchange Act Rule 13a-15.
Based on that evaluation, the Company's principal executive officer and
principal financial officer concluded that such disclosure controls and
procedures are effective to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to them,
particularly during the period for which the periodic reports are being
prepared.
Changes in Internal Controls
No significant changes were made in the Company's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of the evaluation performed pursuant to Securities Exchange Act Rule
13a-15 referred to above.
13
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
Exhibits:
99.1 Certification by Chief Executive Officer pursuant to Section 906
of Sarbanes-Oxley act of 2002.
99.2 Certification by Chief Financial Officer pursuant to Section 906
of Sarbanes-Oxley Act of 2002.
Reports on Form 8-K
September 16, 2002 (filed September 16, 2002) announcing certain
write-offs and write-downs as of 2002 fiscal year end, related losses for 2002
fiscal year and fourth quarter, and related matters.
September 25, 2002 (filed October 1, 2002) announcing waiver under and
amendment to credit agreement.
SIGNATURE
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.
ALLIED HEALTHCARE PRODUCTS, INC.
/s/ Earl R. Refsland
---------------------------------------
Earl R. Refsland
President and Chief Executive Officer
---------------------------------------
Date: November 14, 2002
14
CERTIFICATIONS
I, Earl R. Refsland, President and Chief Executive Officer of Allied Healthcare
Products, Inc., certify that:
1. I have reviewed this quarterly report on Form 10-Q of Allied
Healthcare Products, Inc.;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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 quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
a) designed such disclosure controls and procedures 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 quarterly report
is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and
the audit committee of registrant's board of directors (or persons
performing the equivalent functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
15
6. The registrant's other certifying officers and I have indicated in
this annual report whether there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Date: November 14, 2002
s/ Earl R. Refsland
---------------------
Earl R. Refsland,
President and Chief Executive Officer
16
I, Daniel C. Dunn, Vice President-Finance and Chief Financial Officer of Allied
Healthcare Products, Inc., certify that:
1. I have reviewed this quarterly report on Form 10-Q of Allied
Healthcare Products, Inc.;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual 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 quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
a) designed such disclosure controls and procedures 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 quarterly report
is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and
the audit committee of registrant's board of directors (or persons
performing the equivalent functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
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6. The registrant's other certifying officers and I have indicated in
this annual report whether there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Date: November 14, 2002
s/ Daniel C. Dunn
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Daniel C. Dunn,
Vice President and Chief Financial Officer
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