FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's OMITTED) ASSETS March 31, 2010 June 30, (UNAUDITED) 2009 Current Assets: -------- -------- Cash and cash equivalents $ 570 $ 1,226 Marketable securities 32 23 Accounts receivable - net 5,731 5,392 Accounts receivable - related parties - net 59 - Medical receivables - net 127 374 Management fee receivable - net 2,952 3,274 Management fee receivable - related medical practices - net 1,814 2,196 Costs and estimated earnings in excess of billings on uncompleted contracts 1,012 1,476 Inventories 2,931 3,172 Current portion of advances and notes to related medical practices 130 165 Current portion of notes receivable 86 518 Prepaid expenses and other current assets 266 472 -------- -------- Total Current Assets 15,710 18,288 -------- -------- Property and equipment - net 2,299 2,892 Advances and notes to related medical practices - net - 89 Notes receivable - net 119 1,779 Other intangible assets - net 4,707 4,920 Other assets 392 391 -------- -------- Total Assets $ 23,227 $ 28,359 ======== ======== FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's OMITTED) March 31, LIABILITIES AND STOCKHOLDERS' DEFICIENCY 2010 June 30, (UNAUDITED) 2009 Current Liabilities: -------- -------- Current portion of long-term debt and capital leases $ 418 $ 277 Current portion of long-term debt - related party 86 80 Accounts payable 3,340 3,519 Other current liabilities 7,695 8,460 Unearned revenue on service contracts 5,761 5,526 Unearned revenue on service contracts - related parties 55 - Customer advances 6,089 9,238 Billings in excess of costs and estimated earnings on uncompleted contracts 3,047 2,026 -------- -------- Total Current Liabilities 26,491 29,126 Long-Term Liabilities: Accounts payable 124 184 Due to related medical practices 632 643 Long-term debt and capital leases, less current portion 1,219 759 Long-term debt less current portion - related party 95 160 Other liabilities 467 428 -------- -------- Total Long-Term Liabilities 2,537 2,174 -------- -------- Total Liabilities 29,028 31,300 -------- -------- STOCKHOLDERS' DEFICIENCY: Class A non-voting preferred stock $.0001 par value; 1,600,000 authorized, 313,451 issued and outstanding at March 31, 2010 and June 30, 2009 - - Preferred stock $.001 par value; 2,000,000 shares Authorized, issued and outstanding - none - - Common Stock $.0001 par value; 30,000,000 shares authorized, 4,985,850 and 4,917,918 issued at March 31, 2010 and June 30, 2009, respectively; 4,974,207 and 4,906,275 outstanding at March 31, 2010 and June 30, 2009, respectively 1 1 Class B Common Stock $ .0001 par value; 800,000 shares authorized, (10 votes per share), 158 issued and outstanding at March 31, 2010 and June 30, 2009 - - Class C Common Stock $.0001 par value; 2,000,000 shares authorized, (25 votes per share), 382,513 issued and outstanding at March 31, 2010 and June 30, 2009 - - Paid-in capital in excess of par value 172,379 172,280 Accumulated other comprehensive loss (13) (21) Accumulated deficit (177,300) (174,259) Notes receivable from employee stockholders (193) (267) Treasury stock, at cost - 11,643 shares of common stock at March 31, 2010 and June 30, 2009 (675) (675) -------- -------- Total Stockholders' Deficiency (5,801) (2,941) -------- -------- Total Liabilities and Stockholders' Deficiency $ 23,227 $ 28,359 ======== ======== FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (000's OMITTED, except per share data) FOR THE THREE MONTHS ENDED MARCH 31, --------------------- 2010 2009 REVENUES -------- -------- Product sales - net $ 1,955 $ 6,156 Service and repair fees - net 2,778 2,567 Service and repair fees - related parties - net 55 55 Management and other fees - net 1,738 1,736 Management and other fees - related medical practices - net 988 742 --------- --------- Total Revenues - Net 7,514 11,256 --------- --------- COSTS AND EXPENSES Costs related to product sales 1,353 3,325 Costs related to service and repair fees 566 969 Costs related to service and repair fees - related parties 11 21 Costs related to management and other fees 1,338 1,039 Costs related to management and other fees - related medical practices 703 686 Research and development 528 872 Selling, general and administrative 2,708 3,219 Provision for bad debts 282 363 --------- --------- Total Costs and Expenses 7,489 10,494 --------- --------- Income From Operations 25 762 Interest Expense (66) (75) Interest Expense - Related Parties (21) - Investment Income 51 91 Interest Income - Related Party 2 5 Other Income (Expense) 1 (17) Provision for Income Taxes - (36) NET (LOSS) INCOME $ (8) $ 730 --------- --------- Net (Loss) Income Available to Common Stockholders $ (8) $ 686 ========= ========= Basic Net (Loss) Income Per Common Share $ (0.00) $ 0.14 ========= ========= Diluted Net (Loss) Income Per Common Share $ (0.00) $ 0.13 ========= ========= Basic and Diluted Income Per Share - Common C $ N/A 0.04 ========= ========= Weighted Average Basic Shares Outstanding 4,929,752 4,904,275 ========= ========= Weighted Average Diluted Shares Outstanding 4,929,752 5,031,779 ========= ========= FONAR CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (000's OMITTED, except per share data) FOR THE NINE MONTHS ENDED MARCH 31, --------------------- 2010 2009 REVENUES -------- -------- Product sales - net $ 6,479 $11,975 Service and repair fees - net 8,163 7,737 Service and repair fees - related parties - net 165 165 Management and other fees - net 5,212 5,518 Management and other fees - related medical practices - net 2,613 2,181 License fees and royalties 585 1,755 -------- -------- Total Revenues - Net 23,217 29,331 -------- -------- COSTS AND EXPENSES Costs related to product sales 5,289 7,590 Costs related to service and repair fees 2,485 3,008 Costs related to service and repair fees - related parties 50 64 Costs related to management and other fees 3,989 3,316 Costs related to management and other fees - related medical practices 2,208 2,040 Research and development 2,159 2,681 Selling, general and administrative 9,042 9,955 Provision for bad debts 659 1,063 -------- -------- Total Costs and Expenses 25,881 29,717 -------- -------- Loss From Operations (2,664) (386) Interest Expense (235) (193) Interest Expense - Related Parties (40) - Investment Income 203 236 Interest Income - Related Party 9 17 Other Income (Expense) 35 (15) Minority Interest in Income of Partnerships - (11) Gain on Sale of Consolidated Subsidiary - 1,448 Loss on Note Receivable (350) - Provision for Income Taxes - (36) --------- --------- NET (LOSS) INCOME $ (3,042) $ 1,060 ========= ========= Net (Loss) Income Available to Common Stockholders $ (3,042) $ 997 ========= ========= Basic Net (Loss) Income Per Common Share $ (0.62) $ 0.20 ========= ========= Diluted Net (Loss) Income Per Common Share $ (0.62) $ 0.19 ========= ========= Basic and Diluted Income per share - Common C $ N/A $ 0.05 ========= ========= Weighted Average Basic Common Shares Outstanding 4,917,990 4,904,275 ========= ========= Weighted Average Diluted Common Shares Outstanding 4,917,990 5,031,779 ========= =========UPRIGHT® and STAND-UP® are registered trademarks and The Inventor of MR Scanning™, Full Range of Motion™, pMRI™, Dynamic™, Multi-Position™, True Flow™, The Proof is in the Picture™, Spondylography™ Spondylometry™ and Upright Radiology™ 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.
Contact Information: Contact: Daniel Culver FONAR Corporation Tel: 631-694-2929 Fax: 631-390-1709 http://www.fonar.com