Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2020 | Feb. 05, 2021 | |
Entity Registrant Name | FONAR CORP | |
Entity Central Index Key | 0000355019 | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2020 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity File Number | 0-10248 | |
Entity Incorporation State Country Code | DE | |
Is Entity Interactive Data Current | Yes | |
Is Entity's Reporting Status Current? | Yes | |
Is Entity a Small Business | true | |
Entity Filer Category | Non-accelerated Filer | |
Is Entity an Emerging Growth Company | false | |
Trading Symbol | FONR | |
Security Exchange Name | NASDAQ | |
Security 12B Title | Common Stock | |
Entity Shell Company | false | |
Common Stock | ||
Entity Common Stock, Shares Outstanding | 6,554,210 | |
Class B Common Stock | ||
Entity Common Stock, Shares Outstanding | 146 | |
Class C Common Stock | ||
Entity Common Stock, Shares Outstanding | 382,513 | |
Class A Common Stock | ||
Entity Common Stock, Shares Outstanding | 313,438 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Current Assets: | ||
Cash and cash equivalents | $ 40,579 | $ 36,802 |
Short term investments | 32 | 32 |
Accounts receivable - net | 4,171 | 4,313 |
Account receivable - related parties | 72 | 6 |
Medical receivables -net | 16,373 | 16,172 |
Management and other fees receivable -net | 29,808 | 27,438 |
Management and other fees receivable - related medical practices -net | 7,262 | 6,896 |
Inventories | 1,844 | 1,649 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 153 | 153 |
Income taxes receivable | 671 | |
Prepaid expenses and other current assets | 1,302 | 1,758 |
Total Current Assets | 101,596 | 95,890 |
Accounts receivable | 2,594 | 2,730 |
Deferred income tax asset | 16,848 | 18,810 |
Property and equipment - net | 21,683 | 21,364 |
Right-of-use Asset - operating lease | 29,570 | 31,392 |
Right-of-use-asset - financing lease | 1,226 | 1,326 |
Goodwill | 3,985 | 3,985 |
Other intangible assets - net | 4,014 | 4,109 |
Other assets | 632 | 653 |
Total Assets | 182,148 | 180,259 |
Current Liabilities: | ||
Current portion of long-term debt and capital leases | 222 | 108 |
Accounts payable | 2,198 | 1,965 |
Other current liabilities | 5,584 | 8,185 |
Unearned revenue on service contracts | 4,029 | 4,105 |
Unearned revenue on service contracts - related parties | 55 | |
Operating lease liability - current portion | 3,403 | 3,370 |
Financing lease liability - current portion | 200 | 75 |
Customer deposits | 1,232 | 855 |
Total Current Liabilities | 16,923 | 18,663 |
Long-Term Liabilities: | ||
Unearned revenue on service contracts | 2,528 | 2,656 |
Deferred Income Tax Liability | 234 | 234 |
Due to related party medical practices | 93 | 93 |
Operating lease liability - net of current portion | 28,415 | 30,105 |
Financing lease liability - net of current portion | 1,151 | 1,251 |
Long-term debt and capital leases, less current portion | 780 | 865 |
Other liabilities | 148 | 150 |
Total Long-Term Liabilities | 33,349 | 35,354 |
Total Liabilities | 50,272 | 54,017 |
STOCKHOLDERS' EQUITY: | ||
Paid-in capital in excess of par value | 185,101 | 183,076 |
Accumulated deficit | (50,596) | (56,215) |
Treasury stock, at cost | (675) | (675) |
Total Fonar Corporation Stockholder Equity | 133,831 | 126,187 |
Noncontrolling interests | (1,955) | 55 |
Total Stockholders' Equity | 131,876 | 126,242 |
Total Liabilities and Stockholders' Equity | 182,148 | 180,259 |
Class A Non-Voting Preferred Stock | ||
STOCKHOLDERS' EQUITY: | ||
Preferred stock value | ||
Preferred Stock | ||
STOCKHOLDERS' EQUITY: | ||
Preferred stock value | ||
Common Stock | ||
STOCKHOLDERS' EQUITY: | ||
Common stock value | 1 | 1 |
Class B Common Stock | ||
STOCKHOLDERS' EQUITY: | ||
Common stock value | ||
Class C Common Stock | ||
STOCKHOLDERS' EQUITY: | ||
Common stock value |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares | Dec. 31, 2020 | Jun. 30, 2020 |
Class A Non-Voting Preferred Stock | ||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 |
Preferred Stock, Authorized | 453,000 | 453,000 |
Preferred Stock, Issued | 313,000 | 313,000 |
Preferred Stock, Outstanding | 313,000 | 313,000 |
Preferred Stock | ||
Preferred Stock, Par Value | $ 0.001 | $ 0.001 |
Preferred Stock, Authorized | 567,000 | 567,000 |
Preferred Stock, Issued | ||
Preferred Stock, Outstanding | ||
Common Stock | ||
Common Stock, Par Value | $ 0.0001 | $ 0.0001 |
Common Stock, Authorized | 8,500,000 | 8,500,000 |
Common Stock, Issued | 6,566,000 | 6,459,000 |
Common Stock, Outstanding | 6,554,000 | 6,447,000 |
Class B Common Stock | ||
Common Stock, Par Value | $ 0.0001 | $ 0.0001 |
Common Stock, Authorized | 227,000 | 227,000 |
Common Stock, Issued | 146 | 146 |
Common Stock, Outstanding | 146 | 146 |
Class C Common Stock | ||
Common Stock, Par Value | $ 0.0001 | $ 0.0001 |
Common Stock, Authorized | 567,000 | 567,000 |
Common Stock, Issued | 383,000 | 383,000 |
Common Stock, Outstanding | 383,000 | 383,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
REVENUES | ||||
Patient fee revenue, net of contractual allowances and discounts | $ 5,238 | $ 5,996 | $ 10,330 | $ 12,041 |
Product sales - net | 3 | 3 | 31 | 195 |
Service and repair fees - net | 1,862 | 2,038 | 3,788 | 4,102 |
Service and repair fees - related parties - net | 28 | 28 | 55 | 55 |
Management and other fees - net | 11,340 | 10,996 | 22,554 | 22,024 |
Management and other fees - related medical practices - net | 2,693 | 2,390 | 5,386 | 4,780 |
Total Revenues - net | 21,164 | 21,451 | 42,144 | 43,197 |
COSTS AND EXPENSES | ||||
Costs related to patient fee revenue | 2,649 | 2,958 | 5,169 | 5,820 |
Costs related to product sales | 192 | 120 | 325 | 450 |
Costs related to service and repair fees | 608 | 772 | 1,234 | 1,522 |
Costs related to service and repair fees - related parties | 9 | 10 | 18 | 20 |
Costs related to management and other fees | 6,237 | 6,203 | 11,788 | 12,208 |
Costs related to management and other fees - related medical practices | 1,522 | 1,621 | 2,950 | 3,157 |
Research and development | 424 | 583 | 824 | 1,055 |
Selling, general and administrative | 4,541 | 4,163 | 10,704 | 8,458 |
Total Costs and Expenses | 16,182 | 16,430 | 33,012 | 32,690 |
INCOME | ||||
Income From Operations | 4,982 | 5,021 | 9,132 | 10,507 |
Other Expenses | (140) | |||
Interest Expense | (16) | (19) | (38) | (40) |
Investment Income | 75 | 139 | 187 | 287 |
Income Before Provision for Income Taxes and Noncontrolling Interests | 5,041 | 5,141 | 9,141 | 10,754 |
Provision for Income Taxes | (1,113) | (932) | (1,962) | (2,039) |
Net Income | 3,928 | 4,209 | 7,179 | 8,715 |
Net Income - Noncontrolling Interests | (817) | (1,105) | (1,560) | (2,313) |
Net Income - Attributable to FONAR | $ 3,111 | $ 3,104 | $ 5,619 | $ 6,402 |
Basic Net Income Per Share | $ 0.48 | $ 0.48 | $ 0.87 | $ 0.99 |
Weighted Average Basic Shares Outstanding | 6,465 | 6,447 | 6,456 | 6,440 |
Common Stock | ||||
INCOME | ||||
Net Income - Attributable to FONAR | $ 2,923 | $ 2,914 | $ 5,281 | $ 6,010 |
Basic Net Income Per Share | $ 0.45 | $ 0.45 | $ 0.82 | $ 0.93 |
Diluted Net Income Per Share | $ 0.44 | $ 0.44 | $ 0.80 | $ 0.92 |
Weighted Average Basic Shares Outstanding | 6,465 | 6,447 | 6,456 | 6,440 |
Weighted Average Diluted Shares Outstanding | 6,593 | 6,575 | 6,584 | 6,568 |
Class A Non-Voting Preferred Stock | ||||
INCOME | ||||
Net Income - Attributable to FONAR | $ 140 | $ 142 | $ 252 | $ 292 |
Class C Common Stock | ||||
INCOME | ||||
Net Income - Attributable to FONAR | $ 48 | $ 48 | $ 86 | $ 100 |
Basic Net Income Per Share | $ 0.12 | $ 0.13 | $ 0.23 | $ 0.26 |
Diluted Net Income Per Share | 0.12 | 0.13 | 0.23 | 0.26 |
Basic and Diluted Income Per Share | $ 0.12 | $ 0.13 | $ 0.23 | $ 0.26 |
Weighted Average Basic Shares Outstanding | 383 | 383 | 383 | 383 |
Weighted Average Diluted Shares Outstanding | 383 | 383 | 383 | 383 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock | Paid in capital in excess of par value | Accumulated Deficit | Treasury Stock | Non Controlling Interest | Total |
Balance - Beginning, Value at Jun. 30, 2019 | $ 1 | $ 181,086 | $ (64,455) | $ (675) | $ 2,156 | $ 118,113 |
Issuance of common stock (value) | 1,990 | 1,990 | ||||
Net Income | 6,402 | 6,402 | ||||
Distributions - noncontrolling | (3,735) | (3,735) | ||||
Income - Noncontrolling interests | 2,313 | 2,313 | ||||
Balance - Ending, Value at Dec. 31, 2019 | 1 | 183,076 | (58,053) | (675) | 734 | 125,083 |
Balance - Beginning, Value at Sep. 30, 2019 | 1 | 183,076 | (61,157) | (675) | 1,609 | 122,854 |
Net Income | 3,104 | 3,104 | ||||
Distributions - noncontrolling | (1,980) | (1,980) | ||||
Income - Noncontrolling interests | 1,105 | 1,105 | ||||
Balance - Ending, Value at Dec. 31, 2019 | 1 | 183,076 | (58,053) | (675) | 734 | 125,083 |
Balance - Beginning, Value at Jun. 30, 2020 | 1 | 183,076 | (56,215) | (675) | 55 | 126,242 |
Issuance of common stock (value) | 2,025 | 2,025 | ||||
Net Income | 5,619 | 5,619 | ||||
Distributions - noncontrolling | (3,570) | (3,570) | ||||
Income - Noncontrolling interests | 1,560 | 1,560 | ||||
Balance - Ending, Value at Dec. 31, 2020 | 1 | 185,101 | (50,596) | (675) | (1,955) | 131,876 |
Balance - Beginning, Value at Sep. 30, 2020 | 1 | 183,076 | (53,707) | (675) | (642) | 128,053 |
Issuance of common stock (value) | 2,025 | 2,025 | ||||
Net Income | 3,111 | 3,111 | ||||
Distributions - noncontrolling | (2,130) | (2,130) | ||||
Income - Noncontrolling interests | 817 | 817 | ||||
Balance - Ending, Value at Dec. 31, 2020 | $ 1 | $ 185,101 | $ (50,596) | $ (675) | $ (1,955) | $ 131,876 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income | $ 7,179 | $ 8,715 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 2,009 | 2,003 |
Amortization on right-of-use assets | 1,922 | 1,656 |
Provision (Recovery) for bad debts | 2,825 | (978) |
Deferred income tax - net | 1,962 | 1,816 |
Compensatory element of stock issuances | 83 | |
Stock issued for costs and expense | 1,941 | 1,990 |
Abandoned patents | 1 | |
(Increase) decrease in operating assets, net: | ||
Accounts, medical and management fee receivable(s) | (5,549) | (4,300) |
Notes receivable | 25 | 11 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 372 | |
Inventories | (195) | 47 |
Income tax receivable | 671 | |
Prepaid expenses and other current assets | 452 | 330 |
Other assets | (1) | (45) |
Increase (decrease) in operating liabilities, net: | ||
Accounts payable | 233 | (576) |
Other current liabilities | (2,748) | 430 |
Operating lease liabilities | (1,657) | (1,447) |
Financing lease liabilities | 24 | |
Customer deposits | 378 | 28 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 12 | |
Other liabilities | (3) | 123 |
Net cash provided by operating activities | 9,552 | 10,187 |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment | (2,143) | (4,656) |
Purchase of short term investment | (199) | |
Cost of patents | (90) | (62) |
Net cash used in investing activities | (2,233) | (4,917) |
Cash Flows from Financing Activities: | ||
Repayment of borrowings and capital lease obligations | (35) | (24) |
Proceeds from debt | 63 | |
Distributions to noncontrolling interests | (3,570) | (3,735) |
Net cash used in financing activities | (3,542) | (3,759) |
Net Increase in Cash and Cash Equivalents | 3,777 | 1,511 |
Cash and Cash Equivalents - Beginning of Period | 36,802 | 13,882 |
Cash and Cash Equivalents - End of Period | $ 40,579 | $ 15,393 |
NOTE 1 - DESCRIPTION OF BUSINES
NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 6 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business Effective July 1, 2015, the Company restructured the corporate organization of the management of diagnostic imaging centers segment of our business. The reorganization was structured to more completely integrate the operations of Health Management Corporation of America and HDM. Imperial contributed all of its assets (which were utilized in the business of Health Management Corporation of America) to HDM and received a 24.2% interest in HDM. Health Management Corporation of America retained a direct ownership interest of 45.8% in HDM, and the original investors in HDM retained a 30.0% ownership interest in the newly expanded HDM. The entire management of diagnostic imaging centers business segment is now being conducted by HDM, operating under the name “Health Management Company of America”. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended December 31, 2020, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2021. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K filed on October 1, 2020 for the fiscal year ended June 30, 2020. During March 2020 the global pandemic of COVID-19 has caused turbulence and uncertainty in the United States and international markets and economies which has adversely effected our workforce, liquidity, financial conditions, revenues, profitability and business operations. Generally COVID-19 had caused us to require that much of our workforce work from home and has restricted the ability of our personnel to travel for marketing purposes or to service our customers. The Company experienced a sudden drop in scan volume for a short term period and while the Company is not back to pre-COVID-19 levels, the volume has risen. At the end of fiscal year ending June 30, 2020, the Company was able to enact certain decisions to allow the Company to survive during the global pandemic and from further losses or additional decreases in scan volume. The Company immediately enacted wide scale furloughs, deferment of up to 50% of management salaries, halted variable compensation plans and rent deferrals we negotiated with the majority of all landlords. The Company also received some government stimulus funds from the Paycheck Protection Program (“PPP”) and Medicare advances/stimulus payments. Although we are unable to predict if there will be additional consequences on our operations from the continuing global pandemic of COVID-19, the Company believes with positive cash flows, low debt and cash on hand, it will be able to continue operations going forward. |
NOTE 2 - SUMMARY OF SIGNIFICANT
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of FONAR Corporation, its majority and wholly-owned subsidiaries and partnerships (collectively the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation. Revenues On July 1, 2018, the Company adopted the new revenue recognition accounting standard issued by the Financial Accounting Standards Board (“FASB”) and codified in the ASC as topic 606 (“ASC 606”). The revenue recognition standard in ASC 606 outlines a single comprehensive model for recognizing revenue as performance obligations, defined in a contract with a customer as goods or services transferred to the customer in exchange for consideration, are satisfied. The standard also requires expanded disclosures regarding the Company’s revenue recognition policies and significant judgments employed in the determination of revenue. Our revenues generally relate to net patient fees received from various payers and patients themselves under contracts in which our performance obligations are to provide diagnostic services to the patients. Revenues are recorded during the period our obligations to provide diagnostic services are satisfied. Our performance obligations for diagnostic services are generally satisfied over a period of less than one day. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, Medicaid, managed care health plans and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payers. The payment arrangements with third-party payers for the services we provide to the related patients typically specify payments at amounts less than our standard charges and generally provide for payments based upon predetermined rates per diagnostic services or discounted fee-for-service rates. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in managed care contractual terms resulting from contract renegotiations and renewals. Earnings Per Share Basic earnings per share (“EPS”) is computed based upon the weighted average number of shares of common stock and stock equivalents outstanding, net of common stock. In accordance with ASC topic 260-10, “Participating Securities and the Two-Class method”, the Company used the Two-Class method for calculating basic income per share and applied the if converted method in calculating diluted income per share for the three and six months ended December 31, 2020 and 2019. Diluted EPS reflects the potential dilution from the exercise or conversion of all dilutive securities into common stock based on the average market price of common shares outstanding during the period. For the three and six months ended December 31, 2020 and 2019, diluted EPS for common shareholders includes 128 shares upon conversion of Class C Common. Three months ended Three months ended Total Common Stock Class C Common Total Common Stock Class C Common Basic Numerator: $ 3,111 $ 2,923 $ 48 $ 3,104 $ 2,914 $ 48 Denominator: Weighted average shares outstanding 6,465 6,465 383 6,447 6,447 383 Basic income per common share $ 0.48 $ 0.45 $ 0.12 $ 0.48 $ 0.45 $ 0.13 Diluted Denominator: 6,465 383 6,447 383 Convertible Class C Stock 128 — 128 — Total Denominator for diluted earnings per share 6,593 383 6,575 383 Diluted income per common share $ 0.44 $ 0.12 $ 0.44 $ 0.13 Six months ended Six months ended Total Common Stock Class C Common Total Common Stock Class C Common Basic Numerator: $ 5,619 $ 5,281 $ 86 $ 6,402 $ 6,010 $ 100 Denominator: Weighted average shares outstanding 6,456 6,456 383 6,440 6,440 383 Basic income per common share $ 0.87 $ 0.82 $ 0.23 $ 0.99 $ 0.93 $ 0.26 Diluted Denominator: 6,456 383 6,440 383 Convertible Class C Stock 128 — 128 — Total Denominator for diluted earnings per share 6,584 383 6,568 383 Diluted income per common share $ 0.80 $ 0.23 $ 0.92 $ 0.26 Recent Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12 (“ASU 2019-12”), Income Taxes (Topic 740). ASU 2019-12 removes certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. It also clarifies and simplifies other areas of the standard. ASU 2019-12 will be effective beginning in the first quarter of 2021. Early adoption is permitted. Certain amendments in this update must be applied on a prospective basis, certain amendments must be applied on a retrospective basis, and certain amendments must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings/(deficit) in the period of adoption. We are current evaluating the impact this ASU will have on our financial statements and related disclosures as well as the timing of the adoption. In January 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350). The amendments in this update simplify the test for goodwill impairment by eliminating Step 2 from the impairment test, which required the entity to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities following the procedure that would be required in determining fair value of assets acquired and liabilities assumed in a business combination. The amendments in this update are effective for public companies for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The Company adopted the Standard on July 1, 2020 and the impact of adopting this guidance will have no material impact on our Consolidated Financial Statements. FASB, the Emerging Issues Task Force and the SEC have issued certain other accounting standards, updates, and regulations as of December 31, 2020 that will become effective in subsequent periods; however, management does not believe that any of those updates would have significantly affected our financial accounting measures or disclosures had they been in effect during 2020 or 2019, and it does not believe that any of those pronouncements will have a significant impact on our consolidated condensed financial statements at the time they become effective. Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. The reclassifications did not have any effect on reported consolidated net income for any periods presented. |
NOTE 3 - ACCOUNTS RECEIVABLE, M
NOTE 3 - ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE AND MANAGEMENT AND OTHER FEES RECEIVABLE | 6 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
NOTE 3 - ACCOUNTS RECEIVABLE. MEDICAL RECEIVABLES AND MANAGEMENT AND OTHER FEES RECEIVABLE (USD $) | NOTE 3 – ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE AND MANAGEMENT AND OTHER FEES RECEIVABLE Receivables, net is comprised of the following at December 31, 2020, and June 30, 2020: December 31, 2020 Gross Receivable Allowance for doubtful accounts Net Accounts receivable $ 4,686 $ 515 $ 4,171 Accounts receivable - related party $ 72 — $ 72 Medical receivable $ 16,373 $ — $ 16,373 Management and other fees receivable $ 43,298 $ 13,490 $ 29,808 Management and other fees receivable from related medical practices ("PC’s") $ 10,982 $ 3,720 $ 7,262 June 30, 2020 Gross Receivable Allowance for doubtful accounts Net Accounts receivable $ 4,828 $ 515 $ 4,313 Accounts receivable - related party $ 6 — $ 6 Medical receivable $ 16,172 $ — $ 16,172 Management and other fees receivable $ 38,501 $ 11,063 $ 27,438 Management and other fees receivable from related medical practices ("PC’s") $ 10,218 $ 3,322 $ 6,896 The Company's customers are concentrated in the healthcare industry. Accounts Receivable Credit risk with respect to the Company’s accounts receivable related to product sales and service and repair fees is limited due to the customer advances received prior to the commencement of work performed and the billing of amounts to customers as sub-assemblies are completed. Service and repair fees are billed on a monthly or quarterly basis and the Company does not continue providing these services if accounts receivable become past due. The Company controls credit risk with respect to accounts receivable from service and repair fees through its credit evaluation process, credit limits, monitoring procedures and reasonably short collection terms. The Company performs ongoing credit authorizations before a product sales contract is entered into or service and repair fees are provided. Long Term Accounts Receivable The Company will generate revenue from long-term, non-cancellable contracts to provide service and repair services. Future revenue to be recognized over the following four years as of December 31, 2020 is as follows: 2022 $ 853 2023 827 2024 752 2025 96 Total $ 2,528 Medical Receivables Medical receivables are due under fee-for-service contracts from third party payors, such as hospitals, government sponsored healthcare programs, patient’s legal counsel and directly from patients. Substantially all the revenue relates to patients residing in Florida. The carrying amount of the medical receivable is reduced by an allowance that reflects management’s best estimate of the amounts that will not be collected. The Company determines allowances for contractual adjustments and uncollectible accounts based on specific agings, specific payor collection issues that have been identified and based on payor classifications and historical experience at each site. Management and Other Fees Receivable The Company's receivables from the related and non-related professional corporations (PC's) substantially consist of fees outstanding under management agreements. Payment of the outstanding fees is dependent on collection by the PC's of fees from third party medical reimbursement organizations, principally insurance companies and health management organizations. Payment of the management fee receivables from the PC’s may be impaired by the inability of the PC’s to collect in a timely manner their medical fees from the third party payors, particularly insurance carriers covering automobile no-fault and workers compensation claims due to longer payment cycles and rigorous informational requirements and certain other disallowed claims. Approximately 66% and 60% of the PCs’ net revenues for the three months ended December 31, 2020 and 2019, respectively, were derived from no-fault and personal injury protection claims. Approximately 66% and 63% of the PCs’ net revenue for the six months ended December 31, 2020 and 2019, respectively, were derived from no-fault and personal injury protection claims. The Company considers the aging of its accounts receivable in determining the amount of allowance for doubtful accounts. The Company generally takes all legally available steps to collect its receivables. Credit losses associated with the receivables are provided for in the condensed consolidated financial statements and have historically been within management's expectations. Net revenues from management and other fees charged to the related PCs accounted for approximately 12.7% and 11.1% of the consolidated net revenues for the three months ended December 31, 2020 and 2019, respectively. Net revenues from management and other fees charged to the related PCs accounted for approximately 12.8% and 11.1% of the consolidated net revenues for the six months ended December 31, 2020 and 2019, respectively. Tallahassee Magnetic Resonance Imaging, PA, Stand Up MRI of Boca Raton, PA and Stand Up MRI & Diagnostic Center, PA (all related medical practices) entered into a guaranty agreement, pursuant to which they cross guaranteed all management fees which are payable to the Company, which have arisen under each individual management agreement. Additional Company managed entities also operate under a guaranty agreement, pursuant to which management fees are payable to the Company. The Company’s patient fee revenue, net of contractual allowances and discounts for the three and six months ended December 31, 2020 and 2019 are summarized in the following table. For the Three Months Ended December 31, 2020 2019 Commercial Insurance/ Managed Care $ 966 $ 1,335 Medicare/Medicaid 206 276 Workers' Compensation/Personal Injury 3,543 4,112 Other 523 273 Patient Fee Revenue, net of contractual allowances and discounts $ 5,238 $ 5,996 For the Six Months Ended December 31, 2020 2019 Commercial Insurance/ Managed Care $ 1,912 $ 2,689 Medicare/Medicaid 404 542 Workers' Compensation/Personal Injury 6,930 8,406 Other 1,084 404 Patient Fee Revenue, net of contractual allowances and discounts $ 10,330 $ 12,041 |
NOTE 4 - OPERATING & FINANCING
NOTE 4 - OPERATING & FINANCING LEASES | 6 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
NOTE 4 - OPERATING & FINANCING LEASES | NOTE 4 – OPERATING & FINANCING LEASES During February 2016, FASB issued ASU 2016-02, Leases (Topic 842). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based upon the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Lease with a term of 12 months or less will be accounted for similar to existing guidance foOTr operating leases. The standard was effective for us beginning July 1, 2019. We have elected the optional transition method to apply the standard as of the effective date and therefore, we will not apply the standard to the comparative periods presented in the consolidated financial statements. We have also elected the transition package of the practical expedients permitted within the standard which eliminates the requirements to reassess prior conclusions about lease identification, lease classification and indirect costs. The adoption of this guidance had a material impact on the Company’s balance sheet by virtue of including the present value of its future operating lease payments as a liability of $33.3 million and related right-to-use lease assets as of July 1, 2019. At the time of adoption of this guidance we had no significant financing leases. The Company accounts for its various operating leases in accordance with Accounting Standards Codification (‘ASC’) 842 – Lease, as updated by ASU 2016-02. At the inception of a lease, the Company recognizes right-of-use lease assets and related lease liabilities measured at present value of future lease payments on its balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. Our most common initial term varies in length from 2 to 10 years. Including renewal options negotiated with the landlord, we have a total span of 2 to 16 years at the facilities we lease. The Company reviewed its contracts with vendors and customers, determining that its right-to-use lease assets consisted of only office space operating leases. In determining the right-to-use lease assets and liabilities, the Company did recognize lease extension options which the Company feels would be reasonably exercised. Also included in other current assets is a $202 receivable from a landlord for tenant improvements. Our incremental borrowing rate (“IBR”) used to discount the stream of operating lease payments is closely related to the interest rates available to the Company. A reconciliation of operating and financing lease payments undiscounted cash flows to lease liabilities recognized as of December 31, 2020 is as follows: Year Ending December 31, Operating Lease Payments Financing Lease Payments 2021 $ 4,960 $ 244 2022 4,877 244 2023 4,599 244 2024 4,480 244 2025 4,301 244 Thereafter 17,505 287 Present value discount (8,904 ) (156 ) Total lease liability $ 31,818 $ 1,351 |
NOTE 5 - INVENTORIES
NOTE 5 - INVENTORIES | 6 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
NOTE 5 - INVENTORIES | NOTE 5 - INVENTORIES Inventories included in the accompanying condensed consolidated balance sheets consist of the following: December 31, 2020 June 30, 2020 Purchased parts, components and supplies $ 1,614 $ 1,544 Work-in-process 230 105 Total Inventories $ 1,844 $ 1,649 |
NOTE 6 - COSTS AND ESTIMATED EA
NOTE 6 - COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS | 6 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
NOTE 6 - COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS | NOTE 6 - COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS Information relating to uncompleted contracts is as follows: December 31, 2020 June 30, 2020 Costs incurred on uncompleted contracts $ 448 $ 448 Estimated earnings 309 309 Subtotal 757 757 Less: Billings to date 604 604 Total Costs and estimated earnings in excess of billings on uncompleted contracts $ 153 $ 153 |
NOTE 7 - OTHER INTANGIBLE ASSET
NOTE 7 - OTHER INTANGIBLE ASSETS | 6 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
NOTE 7 - OTHER INTANGIBLE ASSETS | NOTE 7 – OTHER INTANGIBLE ASSETS Other intangible assets, net of accumulated amortization, in the accompanying condensed consolidated balance sheets consist of the following: December 31, 2020 June 30, 2020 Capitalized software development costs $ 7,005 $ 7,005 Patents and copyrights 5,171 5,082 Non-compete 4,100 4,100 Customer relationships 3,800 3,800 Gross Other intangible assets 20,076 19,987 Less: Accumulated amortization 16,062 15,878 Other Intangible Assets $ 4,014 $ 4,109 Amortization of patents and copyrights for the three months ended December 31, 2020 and 2019 amounted to $44 and $47, respectively. Amortization of non-compete for the three months ended December 31, 2020 and 2019 amounted to $0 and $147, respectively. Amortization of customer relationships for the three months ended December 31, 2020 and 2019 amounted to $47 and $47, respectively. Amortization of patents and copyrights for the six months ended December 31, 2020 and 2019 amounted to $89 and $94, respectively. Amortization of non-compete for the six months ended December 31, 2020 and 2019 amounted to $0 and $293, respectively. Amortization of customer relationships for the six months ended December 31, 2020 and 2019 amounted to $95 and $95, respectively. |
NOTE 8 - OTHER CURRENT LIABILIT
NOTE 8 - OTHER CURRENT LIABILITIES | 6 Months Ended |
Dec. 31, 2020 | |
Other Liabilities, Current [Abstract] | |
NOTE 8 - OTHER CURRENT LIABILITIES | NOTE 8 – OTHER CURRENT LIABILITIES Other current liabilities in the accompanying condensed consolidated balance sheets consist of the following: December 31, 2020 June 30, 2020 Accrued salaries, commissions and payroll taxes $ 2,573 $ 4,492 Litigation accruals 9 443 Sales tax payable 1,123 1,353 Legal and other professional fees 276 113 Accounting fees 180 120 Self-funded health insurance reserve 123 87 Accrued interest and penalty 511 877 Other 789 700 Other Current Liabilities $ 5,584 $ 8,185 |
NOTE 9 - STOCKHOLDERS EQUITY
NOTE 9 - STOCKHOLDERS EQUITY | 6 Months Ended |
Dec. 31, 2020 | |
STOCKHOLDERS' EQUITY: | |
NOTE 9 - STOCKHOLDERS EQUITY | NOTE 9 – STOCKHOLDERS EQUITY Common Stock During the six months ended December 31, 2020, the Company issued 102 shares of common stock for costs and expenses of $1,941 and 4 shares of common stock to employees and consultants as compensation valued at $83. During the six months ended December 31, 2019, the Company issued 90 shares of common stock for costs and expenses of $1,990. |
NOTE 10 - SEGMENT AND RELATED I
NOTE 10 - SEGMENT AND RELATED INFORMATION | 6 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
NOTE 10 - SEGMENT AND RELATED INFORMATION | NOTE 10 - SEGMENT AND RELATED INFORMATION The Company operates in two industry segments - manufacturing and the servicing of medical equipment and management of diagnostic imaging centers. The accounting policies of the segments are the same as those described in the summary of significant accounting policies as disclosed in the Company’s 10-K as of June 30, 2020. All inter-segment sales are market-based. The Company evaluates performance based on income or loss from operations. The Company operates in two industry segments - manufacturing and the servicing of medical equipment and management of diagnostic imaging centers. The accounting policies of the segments are the same as those described in the summary of significant accounting policies as disclosed in the Company’s 10-K as of June 30, 2020. All inter-segment sales are market-based. The Company evaluates performance based on income or loss from operations. Summarized financial information concerning the Company's reportable segments is shown in the following table: Medical Management Totals For the three months ended Dec. 31, 2020 Net revenues from external customers $ 1,893 $ 19,271 $ 21,164 Inter-segment net revenues $ 219 $ — $ 219 (Loss) Income from operations $ (8 ) $ 4,990 $ 4,982 Depreciation and amortization $ 65 $ 977 $ 1,042 Capital expenditures $ 70 $ 1,728 $ 1,798 For the three months ended Dec. 31, 2019 Net revenues from external customers $ 2,069 $ 19,382 $ 21,451 Inter-segment net revenues $ 219 $ — $ 219 (Loss) Income from operations $ (790 ) $ 5,811 $ 5,021 Depreciation and amortization $ 94 $ 914 $ 1,008 Capital expenditures $ 153 $ 2,116 $ 2,269 Medical Management Totals For the six months ended Dec. 31, 2020 Net revenues from external customers $ 3,874 $ 38,270 $ 42,144 Inter-segment net revenues $ 438 $ — $ 438 (Loss) Income from operations $ (569 ) $ 9,701 $ 9,132 Depreciation and amortization $ 132 $ 1,878 $ 2,010 Capital expenditures $ 90 $ 2,143 $ 2,233 For the six months ended Dec. 31, 2019 Net revenues from external customers $ 4,352 $ 38,845 $ 43,197 Inter-segment net revenues $ 438 $ — $ 438 (Loss) Income from operations $ (1,526 ) $ 12,033 $ 10,507 Depreciation and amortization $ 185 $ 1,818 $ 2,003 Capital expenditures $ 1,754 $ 2,964 $ 4,718 |
NOTE 11 - SUPPLEMENTAL CASH FLO
NOTE 11 - SUPPLEMENTAL CASH FLOW INFORMATION | 6 Months Ended |
Dec. 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
NOTE 11 - SUPPLEMENTAL CASH FLOW INFORMATION | NOTE 11 – SUPPLEMENTAL CASH FLOW INFORMATION During the six months ended December 31, 2020 and December 31, 2019, the Company paid $35 and $14 for interest, respectively. During the six months ended December 31, 2020 and December 31, 2019, the Company paid $145 and $228 for income taxes, respectively. |
NOTE 12 - COMMITMENTS AND CONTI
NOTE 12 - COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
NOTE 12 - COMMITMENTS AND CONTINGENCIES | NOTE 12 – COMMITMENTS AND CONTINGENCIES Litigation The Company is subject to legal proceedings and claims arising from the ordinary course of its business, including personal injury, customer contract and employment claims. In the opinion of management, the aggregate liability, if any, with respect to such actions, will not have a material adverse effect on the consolidated financial position or results of operations of the Company. There were no material changes in litigation from that reported in our Form 10-K for the fiscal year ended June 30, 2020. Other Matters In September 2020, the Company entered into a settlement agreement with an unrelated third party for a claim made during March 2018 which was scheduled for arbitration. The settlement was for $1.2 million of which $900 was paid by the Company’s insurance in September 2020. The Company paid the remaining balance of $315 in September 2020. The Company is also delinquent in filing sales tax returns for certain states, for which the Company has transacted business. As of December 31, 2020, the Company has recorded tax obligations of approximately $1.1 million plus interest and penalties of approximately $466. The Company is in the process of determining the regulatory requirements in order to become compliant. The Company maintains a self-funded health insurance program with a stop-loss umbrella policy with a third party insurer to limit the maximum potential liability for individual claims to $110 per person and for a maximum potential claim liability based on member enrollment. With respect to this program, the Company considers historical and projected medical utilization data when estimating its health insurance program liability and related expense. As of December 31, 2020 and June 30, 2020, the Company had approximately $123 and $87, respectively, in reserve for its self-funded health insurance programs. The reserves are included in “Other current liabilities” in the condensed consolidated balance sheets. The Company regularly analyzes its reserves for incurred but not reported claims, and for reported but not paid claims related to its reinsurance and self-funded insurance programs. The Company believes its reserves are adequate. However, significant judgment is involved in assessing these reserves such as assessing historical paid claims, average lags between the claims’ incurred date, reported dates and paid dates, and the frequency and severity of claims. There may be differences between actual settlement amounts and recorded reserves and any resulting adjustments are included in expense once a probable amount is known. There were no significant adjustments recorded in the periods covered by this report. |
NOTE 13 - INCOME TAXES
NOTE 13 - INCOME TAXES | 6 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
NOTE 13 - INCOME TAXES | NOTE 13 - INCOME TAXES In accordance with ASC 740-270, Income Taxes – Interim Reporting, the Company is required at the end of each interim period to determine the best estimate of its annual effective tax rate and apply that rate to year-to-date ordinary income or loss. The resulting tax expense (or benefit) is adjusted for the tax effect of specific events, if any, required to be discretely recognized in the interim period as they occur. For the six months ended December 31, 2020 and 2019, the Company recorded income tax expense of $1,962 in 2020 as compared to $2,039 in 2019. The 2020 provision is comprised of a current income tax component of $0 and a deferred income tax component of $1,962. Obligations for any liability associated with the current income tax provision, has been reduced, primarily resulting from the benefits and utilization of net operating loss carryforwards. ASC topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a corporate tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as unrecognized benefits. A liability is recognized (or amount of net operating loss carryforward or amount of tax refundable is reduced) for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC topic 740. The Company believes there are no uncertain tax positions in prior years tax filings and therefore it has not recorded a liability for unrecognized tax benefits. In accordance with ASC topic 740, interest costs related to unrecognized tax benefits are required to be calculated (if applicable) and would be classified as “Interest expense, net”. Penalties if incurred would be recognized as a component of “Selling, general and administrative” expenses. The Company files corporate income tax returns in the United States (federal) and in various state and local jurisdictions. In most instances, the Company is no longer subject to federal, state and local income tax examinations by tax authorities for years prior to 2016. The Company recorded a deferred tax asset of $16,848 and a deferred tax liability of $234 as of December 31, 2020, primarily relating to net operating loss carryforwards of approximately $47,208 available to offset future taxable income through 2031. The net operating losses begin to expire in 2023 for federal tax and state income tax purposes. On March 27, 2020 Congress enacted the CARES Act (Coronavirus Aid, Relief and Economic Security Act). The Act provides numerous tax provisions and other stimulus measures, including temporary changes regarding prior and future operation losses, temporary changes to prior and future limitations on interest deductions, temporary suspension of certain payment requirements for the employer portion of Social Security taxes, technical corrections to prior tax legislation for tax depreciation of certain qualified improvement property and enhanced recoverability of AMT tax credits. At the present time, the only impact of the CARES Act to the Company is allowing a full reimbursement of $1,342 of tax credits relating to the alternative minimum tax credits. The Company received the first half payment in June 2020. The balance of alternative minimum tax credits of $671 was received in July 2020. Previously, these credits were to be refunded over a 3 year period. As we continue to monitor tax implications of the CARES Act and other state and federal stimulus tax legislation, we may make adjustments to our estimates and record additional amounts for tax assets and liabilities. Future ownership changes as determined under Section 382 of the Internal Revenue code could further limit the utilization of net operating loss carryforwards. As of December 31, 2020, no such changes in ownership have occurred. The ultimate realization of deferred tax assets is dependent on the generation of future taxable income during the periods in which those temporary differences become deductible or when such net operating losses can be utilized. The Company considers projected future taxable income, the regulatory environment of the industry and tax planning strategies in making this assessment. At present, the Company believes that it is more likely than not that the benefits from certain deferred tax asset carryforwards, will not all be fully realized. In recognition of this inherent risk, a valuation allowance was established for the partial value of the deferred tax asset, which principally related to research and development tax credits. A valuation allowance will be maintained until sufficient positive evidence exists to support the reversal of the remainder of the valuation. |
NOTE 14 - SUBSEQUENT EVENTS
NOTE 14 - SUBSEQUENT EVENTS | 6 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
NOTE 14 - SUBSEQUENT EVENTS | NOTE 14 – SUBSEQUENT EVENTS The Company has evaluated events that occurred subsequent to December 31, 2020 and through the date the condensed consolidated financial statements were issued. |
NOTE 2 - SUMMARY OF SIGNIFICA_2
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of FONAR Corporation, its majority and wholly-owned subsidiaries and partnerships (collectively the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation. |
Revenue | Revenues On July 1, 2018, the Company adopted the new revenue recognition accounting standard issued by the Financial Accounting Standards Board (“FASB”) and codified in the ASC as topic 606 (“ASC 606”). The revenue recognition standard in ASC 606 outlines a single comprehensive model for recognizing revenue as performance obligations, defined in a contract with a customer as goods or services transferred to the customer in exchange for consideration, are satisfied. The standard also requires expanded disclosures regarding the Company’s revenue recognition policies and significant judgments employed in the determination of revenue. Our revenues generally relate to net patient fees received from various payers and patients themselves under contracts in which our performance obligations are to provide diagnostic services to the patients. Revenues are recorded during the period our obligations to provide diagnostic services are satisfied. Our performance obligations for diagnostic services are generally satisfied over a period of less than one day. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, Medicaid, managed care health plans and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payers. The payment arrangements with third-party payers for the services we provide to the related patients typically specify payments at amounts less than our standard charges and generally provide for payments based upon predetermined rates per diagnostic services or discounted fee-for-service rates. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in managed care contractual terms resulting from contract renegotiations and renewals. |
Earnings Per Share | Earnings Per Share Basic earnings per share (“EPS”) is computed based upon the weighted average number of shares of common stock and stock equivalents outstanding, net of common stock. In accordance with ASC topic 260-10, “Participating Securities and the Two-Class method”, the Company used the Two-Class method for calculating basic income per share and applied the if converted method in calculating diluted income per share for the three and six months ended December 31, 2020 and 2019. Diluted EPS reflects the potential dilution from the exercise or conversion of all dilutive securities into common stock based on the average market price of common shares outstanding during the period. For the three and six months ended December 31, 2020 and 2019, diluted EPS for common shareholders includes 128 shares upon conversion of Class C Common. Three months ended Three months ended Total Common Stock Class C Common Total Common Stock Class C Common Basic Numerator: $ 3,111 $ 2,923 $ 48 $ 3,104 $ 2,914 $ 48 Denominator: Weighted average shares outstanding 6,465 6,465 383 6,447 6,447 383 Basic income per common share $ 0.48 $ 0.45 $ 0.12 $ 0.48 $ 0.45 $ 0.13 Diluted Denominator: 6,465 383 6,447 383 Convertible Class C Stock 128 — 128 — Total Denominator for diluted earnings per share 6,593 383 6,575 383 Diluted income per common share $ 0.44 $ 0.12 $ 0.44 $ 0.13 Six months ended Six months ended Total Common Stock Class C Common Total Common Stock Class C Common Basic Numerator: $ 5,619 $ 5,281 $ 86 $ 6,402 $ 6,010 $ 100 Denominator: Weighted average shares outstanding 6,456 6,456 383 6,440 6,440 383 Basic income per common share $ 0.87 $ 0.82 $ 0.23 $ 0.99 $ 0.93 $ 0.26 Diluted Denominator: 6,456 383 6,440 383 Convertible Class C Stock 128 — 128 — Total Denominator for diluted earnings per share 6,584 383 6,568 383 Diluted income per common share $ 0.80 $ 0.23 $ 0.92 $ 0.26 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12 (“ASU 2019-12”), Income Taxes (Topic 740). ASU 2019-12 removes certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. It also clarifies and simplifies other areas of the standard. ASU 2019-12 will be effective beginning in the first quarter of 2021. Early adoption is permitted. Certain amendments in this update must be applied on a prospective basis, certain amendments must be applied on a retrospective basis, and certain amendments must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings/(deficit) in the period of adoption. We are current evaluating the impact this ASU will have on our financial statements and related disclosures as well as the timing of the adoption. In January 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-04, Intangibles – Goodwill and Other (Topic 350). The amendments in this update simplify the test for goodwill impairment by eliminating Step 2 from the impairment test, which required the entity to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities following the procedure that would be required in determining fair value of assets acquired and liabilities assumed in a business combination. The amendments in this update are effective for public companies for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The Company adopted the Standard on July 1, 2020 and the impact of adopting this guidance will have no material impact on our Consolidated Financial Statements. FASB, the Emerging Issues Task Force and the SEC have issued certain other accounting standards, updates, and regulations as of December 31, 2020 that will become effective in subsequent periods; however, management does not believe that any of those updates would have significantly affected our financial accounting measures or disclosures had they been in effect during 2020 or 2019, and it does not believe that any of those pronouncements will have a significant impact on our consolidated condensed financial statements at the time they become effective. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. The reclassifications did not have any effect on reported consolidated net income for any periods presented. |
NOTE 2 - SUMMARY OF SIGNIFICA_3
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Earnings Per Share | Earnings Per Share Three months ended Three months ended Total Common Stock Class C Common Total Common Stock Class C Common Basic Numerator: $ 3,111 $ 2,923 $ 48 $ 3,104 $ 2,914 $ 48 Denominator: Weighted average shares outstanding 6,465 6,465 383 6,447 6,447 383 Basic income per common share $ 0.48 $ 0.45 $ 0.12 $ 0.48 $ 0.45 $ 0.13 Diluted Denominator: 6,465 383 6,447 383 Convertible Class C Stock 128 — 128 — Total Denominator for diluted earnings per share 6,593 383 6,575 383 Diluted income per common share $ 0.44 $ 0.12 $ 0.44 $ 0.13 Six months ended Six months ended Total Common Stock Class C Common Total Common Stock Class C Common Basic Numerator: $ 5,619 $ 5,281 $ 86 $ 6,402 $ 6,010 $ 100 Denominator: Weighted average shares outstanding 6,456 6,456 383 6,440 6,440 383 Basic income per common share $ 0.87 $ 0.82 $ 0.23 $ 0.99 $ 0.93 $ 0.26 Diluted Denominator: 6,456 383 6,440 383 Convertible Class C Stock 128 — 128 — Total Denominator for diluted earnings per share 6,584 383 6,568 383 Diluted income per common share $ 0.80 $ 0.23 $ 0.92 $ 0.26 |
NOTE 3 - ACCOUNTS RECEIVABLE,_2
NOTE 3 - ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE AND MANAGEMENT AND OTHER FEES RECEIVABLE (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
Summary of Allowance For Doubtful Accounts | Receivables, net is comprised of the following at December 31, 2020, and June 30, 2020: December 31, 2020 Gross Receivable Allowance for doubtful accounts Net Accounts receivable $ 4,686 $ 515 $ 4,171 Accounts receivable - related party $ 72 — $ 72 Medical receivable $ 16,373 $ — $ 16,373 Management and other fees receivable $ 43,298 $ 13,490 $ 29,808 Management and other fees receivable from related medical practices ("PC’s") $ 10,982 $ 3,720 $ 7,262 June 30, 2020 Gross Receivable Allowance for doubtful accounts Net Accounts receivable $ 4,828 $ 515 $ 4,313 Accounts receivable - related party $ 6 — $ 6 Medical receivable $ 16,172 $ — $ 16,172 Management and other fees receivable $ 38,501 $ 11,063 $ 27,438 Management and other fees receivable from related medical practices ("PC’s") $ 10,218 $ 3,322 $ 6,896 |
Receivables - Non Current - net | Future revenue to be recognized over the following four years as of December 31, 2020 is as follows: 2022 $ 853 2023 827 2024 752 2025 96 Total $ 2,528 |
Patient fee revenue - net | The Company’s patient fee revenue, net of contractual allowances and discounts for the three and six months ended December 31, 2020 and 2019 are summarized in the following table. For the Three Months Ended December 31, 2020 2019 Commercial Insurance/ Managed Care $ 966 $ 1,335 Medicare/Medicaid 206 276 Workers' Compensation/Personal Injury 3,543 4,112 Other 523 273 Patient Fee Revenue, net of contractual allowances and discounts $ 5,238 $ 5,996 For the Six Months Ended December 31, 2020 2019 Commercial Insurance/ Managed Care $ 1,912 $ 2,689 Medicare/Medicaid 404 542 Workers' Compensation/Personal Injury 6,930 8,406 Other 1,084 404 Patient Fee Revenue, net of contractual allowances and discounts $ 10,330 $ 12,041 |
NOTE 4 - OPERATING & FINANCIN_2
NOTE 4 - OPERATING & FINANCING LEASES (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Lease, Liability, Maturity | A reconciliation of operating and financing lease payments undiscounted cash flows to lease liabilities recognized as of December 31, 2020 is as follows: Year Ending December 31, Operating Lease Payments Financing Lease Payments 2021 $ 4,960 $ 244 2022 4,877 244 2023 4,599 244 2024 4,480 244 2025 4,301 244 Thereafter 17,505 287 Present value discount (8,904 ) (156 ) Total lease liability $ 31,818 $ 1,351 |
NOTE 5 - INVENTORIES (Tables)
NOTE 5 - INVENTORIES (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories included in the accompanying condensed consolidated balance sheets consist of the following: December 31, 2020 June 30, 2020 Purchased parts, components and supplies $ 1,614 $ 1,544 Work-in-process 230 105 Total Inventories $ 1,844 $ 1,649 |
NOTE 6 - COSTS AND ESTIMATED _2
NOTE 6 - COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Notes to Financial Statements | |
Information relating to uncompleted contracts | Information relating to uncompleted contracts is as follows: December 31, 2020 June 30, 2020 Costs incurred on uncompleted contracts $ 448 $ 448 Estimated earnings 309 309 Subtotal 757 757 Less: Billings to date 604 604 Total Costs and estimated earnings in excess of billings on uncompleted contracts $ 153 $ 153 |
NOTE 7 - OTHER INTANGIBLE ASS_2
NOTE 7 - OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other intangible assets - net | Other intangible assets, net of accumulated amortization, in the accompanying condensed consolidated balance sheets consist of the following: December 31, 2020 June 30, 2020 Capitalized software development costs $ 7,005 $ 7,005 Patents and copyrights 5,171 5,082 Non-compete 4,100 4,100 Customer relationships 3,800 3,800 Gross Other intangible assets 20,076 19,987 Less: Accumulated amortization 16,062 15,878 Other Intangible Assets $ 4,014 $ 4,109 |
NOTE 8 - OTHER CURRENT LIABIL_2
NOTE 8 - OTHER CURRENT LIABILITIES (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Other Liabilities, Current [Abstract] | |
Other current liabilities | Other current liabilities in the accompanying condensed consolidated balance sheets consist of the following: December 31, 2020 June 30, 2020 Accrued salaries, commissions and payroll taxes $ 2,573 $ 4,492 Litigation accruals 9 443 Sales tax payable 1,123 1,353 Legal and other professional fees 276 113 Accounting fees 180 120 Self-funded health insurance reserve 123 87 Accrued interest and penalty 511 877 Other 789 700 Other Current Liabilities $ 5,584 $ 8,185 |
NOTE 10 - SEGMENT AND RELATED_2
NOTE 10 - SEGMENT AND RELATED INFORMATION (Tables) | 6 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment information | Summarized financial information concerning the Company's reportable segments is shown in the following table: Medical Management Totals For the three months ended Dec. 31, 2020 Net revenues from external customers $ 1,893 $ 19,271 $ 21,164 Inter-segment net revenues $ 219 $ — $ 219 (Loss) Income from operations $ (8 ) $ 4,990 $ 4,982 Depreciation and amortization $ 65 $ 977 $ 1,042 Capital expenditures $ 70 $ 1,728 $ 1,798 For the three months ended Dec. 31, 2019 Net revenues from external customers $ 2,069 $ 19,382 $ 21,451 Inter-segment net revenues $ 219 $ — $ 219 (Loss) Income from operations $ (790 ) $ 5,811 $ 5,021 Depreciation and amortization $ 94 $ 914 $ 1,008 Capital expenditures $ 153 $ 2,116 $ 2,269 Medical Management Totals For the six months ended Dec. 31, 2020 Net revenues from external customers $ 3,874 $ 38,270 $ 42,144 Inter-segment net revenues $ 438 $ — $ 438 (Loss) Income from operations $ (569 ) $ 9,701 $ 9,132 Depreciation and amortization $ 132 $ 1,878 $ 2,010 Capital expenditures $ 90 $ 2,143 $ 2,233 For the six months ended Dec. 31, 2019 Net revenues from external customers $ 4,352 $ 38,845 $ 43,197 Inter-segment net revenues $ 438 $ — $ 438 (Loss) Income from operations $ (1,526 ) $ 12,033 $ 10,507 Depreciation and amortization $ 185 $ 1,818 $ 2,003 Capital expenditures $ 1,754 $ 2,964 $ 4,718 |
NOTE 1 - DESCRIPTION OF BUSIN_2
NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details Narrative) - Health Diagnostics Management LLC (HDM) | Jul. 01, 2015 |
The ownership interest of Imperial Management Services after reorganization of newly expanded HDM (percent). | 24.20% |
The ownership interest of Health Management Corporation of America after reorganization of newly expanded HDM (percent). | 45.80% |
The ownership interest of the original investors of HDM after reorganization of newly expanded HDM (percent). | 30.00% |
NOTE 2 - SUMMARY OF SIGNIFICA_4
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Basic Numerator: Net income available to common stockholders | $ 3,111 | $ 3,104 | $ 5,619 | $ 6,402 |
Basic Denominator: Weighted average shares outstanding | 6,465 | 6,447 | 6,456 | 6,440 |
Basic income per common share | $ 0.48 | $ 0.48 | $ 0.87 | $ 0.99 |
Shares included upon conversion of Class C Common to calculate a diluted EPS | 128 | 128 | 128 | 128 |
Common Stock | ||||
Basic Numerator: Net income available to common stockholders | $ 2,923 | $ 2,914 | $ 5,281 | $ 6,010 |
Basic Denominator: Weighted average shares outstanding | 6,465 | 6,447 | 6,456 | 6,440 |
Basic income per common share | $ 0.45 | $ 0.45 | $ 0.82 | $ 0.93 |
Shares included upon conversion of Class C Common to calculate a diluted EPS | 128 | 128 | 128 | 128 |
Total Denominator for diluted earnings per share | 6,593 | 6,575 | 6,584 | 6,568 |
Diluted income per common share | $ 0.44 | $ 0.44 | $ 0.80 | $ 0.92 |
Class C Common Stock | ||||
Basic Numerator: Net income available to common stockholders | $ 48 | $ 48 | $ 86 | $ 100 |
Basic Denominator: Weighted average shares outstanding | 383 | 383 | 383 | 383 |
Basic income per common share | $ 0.12 | $ 0.13 | $ 0.23 | $ 0.26 |
Shares included upon conversion of Class C Common to calculate a diluted EPS | ||||
Total Denominator for diluted earnings per share | 383 | 383 | 383 | 383 |
Diluted income per common share | $ 0.12 | $ 0.13 | $ 0.23 | $ 0.26 |
NOTE 2 - SUMMARY OF SIGNIFICA_5
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | ||||
Shares included upon conversion of Class C Common to calculate a diluted EPS. | 128 | 128 | 128 | 128 |
NOTE 3 - ACCOUNTS RECEIVABLE,_3
NOTE 3 - ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE AND MANAGEMENT AND OTHER FEES RECEIVABLE - Receivables, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Accounts receivable | $ 4,171 | $ 4,313 |
Accounts receivable - Related party | 72 | 6 |
Medical Receivables | 16,373 | 16,172 |
Management and other fees receivable | 29,808 | 27,438 |
Management and other fees receivable from related medical practices ("PC's") | 7,262 | 6,896 |
Gross Receivable | ||
Accounts receivable | 4,686 | 4,828 |
Accounts receivable - Related party | 72 | 6 |
Medical Receivables | 16,373 | 16,172 |
Management and other fees receivable | 43,298 | 38,501 |
Management and other fees receivable from related medical practices ("PC's") | 10,982 | 10,218 |
Allowance for Doubtful Accounts | ||
Accounts receivable | 515 | 515 |
Accounts receivable - Related party | ||
Medical Receivables | ||
Management and other fees receivable | 13,490 | 11,063 |
Management and other fees receivable from related medical practices ("PC's") | $ 3,720 | $ 3,322 |
NOTE 3 - ACCOUNTS RECEIVABLE,_4
NOTE 3 - ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE & MANAGEMENT & OTHER FEES RECEIVABLE - Long Term Accounts Receivable (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Receivables, Long-term Contracts or Programs [Abstract] | |
2022 | $ 853 |
2023 | 827 |
2024 | 752 |
2025 | 96 |
Total | $ 2,528 |
NOTE 3 - ACCOUNTS RECEIVABLE,_5
NOTE 3 - ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE AND MANAGEMENT AND OTHER FEES RECEIVABLE - Patient Fees Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Patient fee revenue, net of contractual allowances and discounts | $ 5,238 | $ 5,996 | $ 10,330 | $ 12,041 |
Commercial Insurance / Managed Care | ||||
Patient fee revenue, net of contractual allowances and discounts | 966 | 1,335 | 1,912 | 2,689 |
Medicare/Medicaid | ||||
Patient fee revenue, net of contractual allowances and discounts | 206 | 276 | 404 | 542 |
Workers Compensation/Personal Injury | ||||
Patient fee revenue, net of contractual allowances and discounts | 3,543 | 4,112 | 6,930 | 8,406 |
Other | ||||
Patient fee revenue, net of contractual allowances and discounts | $ 523 | $ 273 | $ 1,084 | $ 404 |
NOTE 3 - ACCOUNTS RECEIVABLE,_6
NOTE 3 - ACCOUNTS RECEIVABLE, MEDICAL RECEIVABLE AND MANAGEMENT AND OTHER FEES RECEIVABLE - (Details Narrative) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Note 3 - Accounts Receivable Medical Receivable And Management And Other Fees Receivable - | ||||
Percentage of PC's net revenue derived from no-fault and personal injury protection claims | 66.00% | 60.00% | 66.00% | 63.00% |
Percentage of consolidated net revenue from management fees charged to related party medical practices | 12.70% | 11.10% | 12.80% | 11.10% |
NOTE 4 - OPERATING & FINANCIN_3
NOTE 4 - OPERATING & FINANCING LEASES (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Operating Lease Payments | |
2021 | $ 4,960 |
2022 | 4,877 |
2023 | 4,599 |
2024 | 4,480 |
2025 | 4,301 |
Thereafter | 17,505 |
Present Value discount | (8,904) |
Total lease liability | 31,818 |
Financing Lease Payments | |
2021 | 244 |
2022 | 244 |
2023 | 244 |
2024 | 244 |
2025 | 244 |
Thereafter | 287 |
Present Value discount | (156) |
Total lease liability | $ 1,351 |
NOTE 4 - OPERATING & FINANCIN_4
NOTE 4 - OPERATING & FINANCING LEASES (Details Narrative) $ in Thousands | 6 Months Ended |
Dec. 31, 2020USD ($) | |
Leases [Abstract] | |
Receivable from landlord for tenant improvements | $ 202 |
Operating lease payments | $ 33,300 |
NOTE 5 - INVENTORIES (Details)
NOTE 5 - INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Inventory Disclosure [Abstract] | ||
Purchased parts, components and supplies | $ 1,614 | $ 1,544 |
Work-in-process | 230 | 105 |
Total Inventories | $ 1,844 | $ 1,649 |
NOTE 6 - COSTS AND ESTIMATED _3
NOTE 6 - COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS - Information relating to uncompleted contracts (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Notes to Financial Statements | ||
Costs incurred on uncompleted contracts | $ 448 | $ 448 |
Estimated earnings | 309 | 309 |
Costs and estimated earnings on uncompleted contracts | 757 | 757 |
Less: Billings to date | 604 | 604 |
Total costs and estimated earnings in excess of billings on uncompleted contracts | $ 153 | $ 153 |
NOTE 7 - OTHER INTANGIBLE ASS_3
NOTE 7 - OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Gross other intangible assets | $ 20,076 | $ 19,987 |
Less: Accumulated amortization | 16,062 | 15,878 |
Other intangible assets-net | 4,014 | 4,109 |
Capitalized software development costs | ||
Gross other intangible assets | 7,005 | 7,005 |
Patents and copyrights | ||
Gross other intangible assets | 5,171 | 5,082 |
Non-compete | ||
Gross other intangible assets | 4,100 | 4,100 |
Customer relationships | ||
Gross other intangible assets | $ 3,800 | $ 3,800 |
NOTE 7 - OTHER INTANGIBLE ASS_4
NOTE 7 - OTHER INTANGIBLE ASSETS (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Patents and copyrights | ||||
Amortization of intangible assets | $ 44 | $ 47 | $ 89 | $ 94 |
Non-compete | ||||
Amortization of intangible assets | 0 | 147 | 0 | 293 |
Customer relationships | ||||
Amortization of intangible assets | $ 47 | $ 47 | $ 95 | $ 95 |
NOTE 8 - OTHER CURRENT LIABIL_3
NOTE 8 - OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Jun. 30, 2020 |
Other Liabilities, Current [Abstract] | ||
Accrued salaries, commissions and payroll taxes | $ 2,573 | $ 4,492 |
Litigation accruals | 9 | 443 |
Sales tax payable | 1,123 | 1,353 |
Legal and other professional fees | 276 | 113 |
Accounting fees | 180 | 120 |
Self-funded health insurance reserve | 123 | 87 |
Accrued interest and penalty | 511 | 877 |
Other | 789 | 700 |
Other current liabilities | $ 5,584 | $ 8,185 |
NOTE 9 - STOCKHOLDERS EQUITY (D
NOTE 9 - STOCKHOLDERS EQUITY (Details Narrative) - USD ($) shares in Thousands, $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
STOCKHOLDERS' EQUITY: | ||
Stock issued for cost and expenses, shares | 102 | 90 |
Stock issued for cost and expenses, value | $ 1,941 | $ 1,990 |
Stock issued for compensation, shares | 4 | |
Stock issued for compensation, value | $ 83 |
NOTE 10 - SEGMENT AND RELATED_3
NOTE 10 - SEGMENT AND RELATED INFORMATION - Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net revenues from external customers | $ 21,164 | $ 21,451 | $ 42,144 | $ 43,197 |
Inter-segment net revenues | 219 | 219 | 438 | 438 |
(Loss) Income from operations | 4,982 | 5,021 | 9,132 | 10,507 |
Depreciation and amortization | 1,042 | 1,008 | 2,010 | 2,003 |
Capital expenditures | 1,798 | 2,269 | 2,233 | 4,718 |
Medical Equipment | ||||
Net revenues from external customers | 1,893 | 2,069 | 3,874 | 4,352 |
Inter-segment net revenues | 219 | 219 | 438 | 438 |
(Loss) Income from operations | (8) | (790) | (569) | (1,526) |
Depreciation and amortization | 65 | 94 | 132 | 185 |
Capital expenditures | 70 | 153 | 90 | 1,754 |
Management Of Diagnostic Imaging Centers | ||||
Net revenues from external customers | 19,271 | 19,382 | 38,270 | 38,845 |
Inter-segment net revenues | ||||
(Loss) Income from operations | 4,990 | 5,811 | 9,701 | 12,033 |
Depreciation and amortization | 977 | 914 | 1,878 | 1,818 |
Capital expenditures | $ 1,728 | $ 2,116 | $ 2,143 | $ 2,964 |
NOTE 11 - SUPPLEMENTAL CASH F_2
NOTE 11 - SUPPLEMENTAL CASH FLOW INFORMATION ($) (Details Narrative) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | ||
Interest paid | $ 35 | $ 14 |
Income taxes paid | $ 145 | $ 228 |
NOTE 12 - COMMITMENTS AND CON_2
NOTE 12 - COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Litigation settelement description | In September 2020, the Company entered into a settlement agreement with an unrelated third party for a claim made during March 2018 which was scheduled for arbitration. The settlement was for $1.2 million of which $900 was paid by the Company’s insurance in September 2020. The Company paid the remaining balance of $315 in September 2020. | |
Recorded tax obligations | $ 1,100 | |
Tax interest and penalties | 466 | |
Maximum limit for individual claims under stop-loss umbrella policy for health insurance | 110 | |
Self-funded health insurance reserve | $ 123 | $ 87 |
NOTE 13 - INCOME TAXES (Details
NOTE 13 - INCOME TAXES (Details Narrative) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense | $ 1,962 | $ 2,039 |
Income tax component - current | 0 | |
Income tax component - deferred | 1,962 | |
Deferred tax assets | 16,848 | |
Deferred tax liability | 234 | |
Net operating loss (NOL) carryforwards available to offset future taxable income | $ 47,208 | |
Reimbursement of alternative minimum tax credits description | The Company is allowing a full reimbursement of $1,342 of tax credits relating to the alternative minimum tax credits. The Company received the first half payment in June 2020. The balance of alternative minimum tax credits of $671 was received in July 2020. Previously, these credits were to be refunded over a 3 year period. |