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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________ to _____________
Commission File Number 0-15223
HEMACARE CORPORATION
(Exact name of registrant as specified in its charter)
California 95-3280412
------------------------------ ----------------------------
State or other jurisdiction of (I.R.S. Employer I.D. Number)
incorporation or organization
4954 Van Nuys Boulevard
Sherman Oaks, California 91403
(Address of principal executive offices) (Zip Code)
___________________
Registrant's telephone number, including area code: (818) 986-3883
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 12 months (or for such shorter period that
the Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days:
YES X NO ___
As of May 11, 2001, 7,403,857 shares of Common Stock of the Registrant
were issued and outstanding.
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INDEX
HEMACARE CORPORATION AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
------- ----------------------
Item 1. Financial Statements
Consolidated balance sheets - March 31, 2001 (unaudited) and
December 31, 2000
Consolidated income statements - Three months ended March 31,
2001 and 2000 (unaudited)
Consolidated statements of cash flows - Three months ended March
31, 2001 and 2000 (unaudited)
Notes to consolidated financial statements - March 31, 2001
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Item 3. Qualitative and Quantitative Disclosures About Market Risk
PART II. OTHER INFORMATION
-------- ------------------
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
----------
HEMACARE CORPORATION
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2001 2000
------------ -----------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents............................ $ 766,000 $ 1,362,000
Marketable securities................................ 480,000 868,000
Accounts receivable, net of allowance for
doubtful accounts - $204,000 in 2001 and 2000...... 4,803,000 3,996,000
Product inventories and supplies..................... 652,000 723,000
Prepaid expenses..................................... 173,000 187,000
Deferred income taxes................................ 1,239,000 1,239,000
------------ ------------
Total current assets..................... 8,113,000 8,375,000
Plant and equipment, net of accumulated
depreciation and amortization of
$2,045,000 (2001) and $1,988,000 (2000).............. 949,000 799,000
Goodwill, net of amortization of $128,000 (2001) and
$115,000 (2000)...................................... 402,000 415,000
Deferred taxes......................................... 1,733,000 1,854,000
Other assets........................................... 24,000 34,000
------------ ------------
$11,221,000 $11,477,000
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable..................................... $ 1,694,000 $ 2,044,000
Accrued payroll and payroll taxes.................... 1,019,000 874,000
Other accrued expenses............................... 116,000 156,000
Current obligations under capital leases............. 47,000 51,000
Current obligations under note payable............... 29,000 --
Reserve for discontinued operations.................. 75,000 76,000
------------ ------------
Total current liabilities................ 2,980,000 3,201,000
Obligations under capital leases, net
of current portion................................... 39,000 46,000
Note payable, net of current portion................... 85,000 --
Other long-term liabilities............................ 27,000 27,000
Commitments and contingencies..........................
Shareholders' equity:
Common stock, no par value - 20,000,000
shares authorized, 7,403,857 issued and
outstanding in 2001 and 7,689,657 in 2000........... 12,832,000 13,164,000
Accumulated deficit.................................. (4,742,000) (4,961,000)
------------ ------------
Total shareholders' equity............... 8,090,000 8,203,000
------------ ------------
$11,221,000 $11,477,000
============ ============
The accompanying notes are an integral part of these
consolidated financial statements.
3
4
HEMACARE CORPORATION
CONSOLIDATED INCOME STATEMENTS
(Unaudited)
Three months ended March 31,
2001 1999
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Revenues:
Blood management programs......................... $ 2,720,000 $ 2,253,000
Regional operations
Blood products.................................. 1,380,000 1,039,000
Blood services.................................. 1,957,000 1,680,000
------------ ------------
Total revenue................................. 6,057,000 4,972,000
Operating costs and expenses:
Blood management programs......................... 2,344,000 1,820,000
Regional operations
Blood products.................................. 1,249,000 788,000
Blood services.................................. 1,272,000 1,133,000
------------ ------------
Total operating costs and expenses........... 4,865,000 3,741,000
------------ ------------
Gross profit................................. 1,192,000 1,231,000
General and administrative expense.................. 845,000 891,000
------------ ------------
Income before income taxes.......................... 347,000 340,000
Provision for income taxes.......................... 128,000 15,000
------------ ------------
Net income..................................... $ 219,000 $ 325,000
============ ============
Basic and diluted per share amounts................. $ 0.03 $ 0.04
============ ============
Weighted average shares outstanding - basic......... 7,505,000 7,489,000
============ ============
Weighted average shares outstanding - diluted....... 8,036,000 8,888,000
============ ============
The accompanying notes are an integral part of these
consolidated financial statements.
4
5
HEMACARE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended March 31,
2001 2000
------------ ------------
Cash flows from operating activities:
Net income............................................... $ 219,000 $ 325,000
Adjustments to reconcile net income to net cash provided
by operating activities:
Provision for losses on accounts receviable........... - 6,000
Depreciation and amortization......................... 70,000 59,000
Deferred income taxes used to offset current period
income.............................................. 121,000 -
Changes in operating assets and liabilities:
(Increase) in accounts receivable..................... (807,000) (508,000)
Decrease in inventories, supplies and prepaid
expenses............................................. 85,000 42,000
(Decrease) increase in accounts payable, accrued
expenses and other liabilities...................... (245,000) 282,000
(Expenditures) for discontinued operations............ (1,000) -
----------- -----------
Net cash provided by operating activities............. (558,000) 206,000
Cash flows from investing activities:
Decrease in other assets.................................. 10,000 4,000
Decrease (increase) in marketable securities.............. 388,000 (396,000)
(Purchase) of plant and equipment, net.................... (91,000) (15,000)
---------- -----------
Net cash used in investing activities..................... 307,000 (407,000)
Cash flows from financing activities:
Proceeds from issuance of common stock.................... - 34,000
Principal payments on line of credit, capital leases
and note payable........................................ (13,000) (49,000)
Repurchase of common stock................................ (332,000) -
----------- -----------
Net cash used in financing activities..................... (345,000) (15,000)
----------- -----------
Decrease in cash and cash equivalents....................... (596,000) (216,000)
Cash and cash equivalents at beginning of period............ 1,362,000 1,490,000
----------- -----------
Cash and cash equivalents at end of period.................. $ 766,000 $1,274,000
=========== ===========
Supplemental disclosure:
Interest paid............................................. $ 3,000 $ 13,000
=========== ===========
Income taxes paid......................................... $ 7,000 $ 36,000
=========== ===========
Items not affecting cash flow:
Note payable issued in connection with acquisition
of plant and equipment................................ $ 116,000 $ -
=========== ===========
5
The accompanying notes are an integral part of these
consolidated financial statements.
HemaCare Corporation
Notes to Consolidated Financial Statements
Note 1 - Basis of Presentation and General Information
The accompanying unaudited consolidated financial statements of
HemaCare Corporation (the "Company" or "HemaCare") have been
prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form
10-Q and Rule 10-01 of Regulation S-X. 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 months ended March 31, 2001, are not
necessarily indicative of the results that may be expected for the
year ending December 31, 2001. For further information, refer to
the consolidated financial statements and footnotes thereto included
in HemaCare's Annual Report on Form 10-K for the year ended
December 31, 2000.
The preparation of financial statements in conformity with generally
accepted accounting principles in the United States requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial
statements. Estimates also affect the reported amounts of
revenue and expenses during the reporting period. Actual results
could differ from those estimates.
Note 2 - Note Payable, Bank
In February 2001, HemaCare financed the acquisition of certain
vehicles with a note payable to a bank in the amount of $116,500.
The note requires monthly principal payments of $2,428 plus
interest at the rate of 8.3% per annum. The note matures in
February 2005 and is secured by the acquired vehicles.
Note 3 - Commitments and Contingencies
Since 1976, California law has prohibited the infusion of blood
products into patients if the donors of those products were paid
unless, in the opinion of the recipient's physician, blood from a
non-paid donor was not immediately available. Apheresis platelet
products obtained from paid donors have been exempted from this law
by a series of state statutes the latest of which expires on
December 31, 2002. Unless a new exemption is obtained, the existing
exemption will expire under its sunset provision and could have a
material adverse effect on HemaCare's revenue and net income.
State and Federal laws set forth antikickback and self-referral
prohibitions and otherwise regulate financial relationships between
blood banks and hospitals, physicians and other persons who refer
business to them. While HemaCare believes its present
operations comply with applicable regulations, there can be no
assurance that future legislation or rule making, or the
interpretation of existing laws and regulations will not prohibit
or adversely impact the delivery by HemaCare of its services and
products.
Note 4 - Common Stock
On July 5, 2000, HemaCare announced its intention to repurchase
up to 15% of its outstanding shares, or up to 1.1 million shares.
HemaCare repurchases these shares from time to time in open
market and private transactions depending on price and
availability. As of March 31, 2001, HemaCare repurchased
725,000 shares at an average cost per share of $1.36, including
the purchase of 293,000 shares during the quarter at an average
price of $1.15.
Note 5 - Business Segments
HemaCare operates in three business segments, each of which
represents a separate business activity. The segments and a
description of their business activities follows:
- Blood Products - the collection, manufacture and distribution of
blood components derived from whole blood collections and blood
component collections using a specialized blood separation
process called apheresis.
- Blood Services - therapeutic apheresis and stem cell collection
procedures, and donor testing.
- Blood Management Programs (BMP) - outsource programs that
provide all or a major portion of the blood products and blood
services to a specific hospital client.
Management uses more than one measure to evaluate segment
performance. However, the dominant measurements are consistent with
HemaCare's consolidated financial statements, which present
revenue from external customers and operating income for each
segment.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
------ ------------------------------------------------------------
Our business activities include regional sales of blood products
("Blood Products") and blood related services ("Blood Services")
and blood management programs ("Blood Management Programs" or
"BMPs").
Our regional Blood Products operations provide blood components to all
hospitals in a region where we can obtain supplier relationships.
Blood Products include apheresis platelets and whole blood components,
such as red blood cells and plasma products. Our operations specialize
in providing single donor platelets, a blood component that promotes
clotting and is essential to stop bleeding. Single donor platelets
are generally in short supply in the US and have a very short
useful life after collection (5 days).
Our Blood Services include therapeutic apheresis products and
stem cell collections utilizing specialized equipment and specially
trained nursing staff, generally in a hospital setting. Additionally,
Blood Services operations include blood testing services
performed for hospitals which operate their own blood collection
programs.
Our Blood Management Programs are customized contractual arrangements
under which HemaCare assumes responsibility for providing blood
products and blood services to a specific hospital. Generally each BMP
involves HemaCare managing and staffing a blood collection center on
the hospital campus, conducting blood component collection drives in the
hospital's local community and assuming responsibility for regulatory
compliance of blood collection operations. Each BMP provides the
hospital with a substantial portion of its blood product needs, thereby
reducing the reliance of the hospital on blood supplies provided by a
regional blood center.
In February 2000, we started a Blood Management Program with Long Beach
Memorial Medical Center ("LBMMC") and in May 2000 opened a Blood
Management Program with Presbyterian Intercommunity Hospital ("PIH")
both of which are located in Southern California. Nationally, we now
operate eight blood management programs. A ninth BMP, for Children's
Memorial Hospital in Chicago, Illinois, is in the start up stage and
will begin operations June 1, 2001.
In addition to the new programs, we operate BMP programs for two
hospitals affiliated with the University of Southern California
(University Hospital and Kenneth Norris Cancer Hospital); the Medical
Center operated by the University of California, Irvine; Dartmouth-
Hitchcock Medical Center ("DHMC"), affiliated with Dartmouth Medical
College in New Hampshire; St. Vincent Hospital at Worcester Medical
Center ("St. Vincent") in Massachusetts; and the UNC Hospitals
affiliated with University of North Carolina in Chapel Hill.
We also operate a Blood Management Program for Maine Medical Center in
Portland Maine. During 2000, we expanded our operations in Maine and
our Maine Blood Center now provides some blood products and services to
other hospitals in the region. For comparability purposes we continue
to classify these activities as a Blood Management Program.
All comparisons within the following discussions are to the previous
year.
Revenue and Gross Profit and Net Income Overview
------------------------------------------------
Revenue in 2001 was $6,057,000 compared to $4,972,000 in 2000. The
increase of $1,085,000 (22%) reflects the expansion of all of our
business segments. Gross profits were $1,192,000 (20% of revenues) in
2001 compared to $1,231,000 (25% of revenues) in 2000.
Income before taxes totaled $347,000 in 2001, slightly improved from
$340,000 in 2000. Net income in 2001 was $219,000 compared to $325,000
in 2000. Earnings per share (primary and diluted) for the quarter
totaled $0.03 in 2001 compared to $0.04 in the prior year.
The decrease in net income and earnings per share primarily result from
increased income tax expense in 2001. Earnings per share reflect
reduced net income and the positive effects of fewer shares outstanding
in 2001.
The decrease in gross profits and gross profit margins is primarily the
result of lower levels of profitability in our California BMP and
regional Blood Products operations. These decreases were partially
offset by increases in profits and profit margins in our Eastern US BMP
operations and Blood Services operations in both California and the
Eastern US.
Blood Products
--------------
Blood Products revenue in 2001 was $1,380,000 compared to $1,039,000 in
2000. The increase of $341,000 (33%) reflects increased sales to our
existing customers, the addition of new hospital customers and sales to
hospitals normally supplied by the American Red Cross (ARC) when the ARC
was not able to supply their platelet needs. Gross profits of the Blood
Products segment declined to $131,000 (9% of revenues) in 2001 from
$251,000 (24% of revenue) in 2000.
Most Blood Products revenues and activities are generated from our donor
center operation in Sherman Oaks, California. This center specializes
in producing single donor platelets. The decrease in profitability in
this segment, despite higher sales, results from several factors. These
include: 1) full implementation of a new regulatory requirement that
reduced the average number of saleable platelet units obtained with each
collection procedure; 2) higher donor recruiting and compensation costs
incurred to meet additional unanticipated product demand; 3) high rates
of product returns and consequent product outdating during certain weeks
of the quarter; 4) continued aggressive price competition from the ARC
for single donor platelets in California; and 5) less than optimum cost
controls in place at our Sherman Oaks collection and production
facility.
With the exception of single donor platelet product pricing (discussed
below), management has undertaken several steps to address the low
profitability of Sherman Oaks product operations. These include: 1)
evaluation of new laboratory technology to improve the average product
yield per collection procedure; 2) improved inventory monitoring and
production scheduling to reduce extra donor recruiting costs and product
outdates; and 3) stricter controls on labor costs and employee overtime.
Blood Product Pricing and Litigation Against the American Red Cross
Blood product prices in the greater Los Angeles area are effectively set
by the ARC which supplies more than 95% of the area's whole blood
derived products (red blood cells and plasma products for transfusion)
and approximately 70% of single donor platelets. HemaCare estimates
that we provide approximately 30% of the area's single donor platelets.
Since 1997 the ARC has lowered its prices for single donor platelets in
the Los Angeles area by more than 30%. The ARC price reductions have
been implemented despite the increasing costs of producing the product
(these costs are associated with new infectious disease testing
protocols, consequent shorter product shelf life and higher product
expirations) and despite the fact that the ARC reports that its blood
product operations generate operating losses in Southern California.
HemaCare has filed a lawsuit against the ARC alleging violation of
Federal antitrust laws and unfair competition. Our lawsuit contends
that ARC business practices are designed to prevent or eliminate
competition in the blood products and services industry. Specific to
Southern California, our lawsuit alleges that ARC pricing practices for
single donor platelets in the Los Angeles area are predatory and are
designed to eliminate HemaCare as a competitor in this market. Our
contentions in the lawsuit are supported by the fact that ARC prices for
single donor platelets in Los Angeles are lower than ARC prices in all
other areas of the US, and that Los Angeles is a high cost market for
both blood products and other healthcare services relative to most other
parts of the US.
Recently, the ARC has announced major changes in pricing structure for
blood products in the Los Angeles area. The changes consist of further
reductions in prices of single donor platelets and major increases in
the prices of other blood products.
We anticipate that profit margins in the Blood Products segment will
improve from levels generated in the first quarter of 2001 as a result
of improved cost controls and other factors. However, competitive
pricing pressure in this segment is expected to continue to negatively
affect out profit margins from sales of single donor platelets in
California until the ARC revises its pricing strategy.
Blood Services
--------------
Blood Services revenue in 2001 was $1,957,000 compared to $1,680,000 in
2000. The increase of $277,000 (16%) is related to increased procedure
volumes at existing hospital clients and to a lesser extent procedures
performed at new hospital clients. Gross profit as a percentage of
revenue was 35% ($685,000) in 2001, compared to 33% ($547,000) in 2000.
The increase in gross profit percentages reflects increased operating
effectiveness associated with higher procedure volumes.
Blood Management Programs
-------------------------
Revenue in 2001 was $2,720,000 compared to $2,253,000 in 2000, an
increase of $467,000 (21%). Revenues for 2001 include three months of
revenue from LBMMC BMP (opened in February 2000) and PIH BMP (opened in
May 2000). Additionally, revenues at existing centers increased as a
result of greater blood product collections. Gross profit as a
percentage of revenue was 14% ($376,000) for 2001, compared to 19%
($433,000) in 2000. The decrease in BMP gross profits and profit
margins between periods relates to increased labor costs in California
BMPs and higher blood product purchase costs in our BMP at St.
Vincent's. Additionally, California BMP profit margins were negatively
impacted by lower profit margins associated with single donor platelets
collected and manufactured at our Sherman Oaks facility but supplied to
these hospitals.
The California BMP cost increases relate to the expansion of our blood
collection programs with the objective of collecting significantly
greater quantities of whole blood products in response to increased
demand for these products. We expect that our expanded collection
capabilities will benefit income and revenues in future periods as
collections increase and market prices of whole blood products continue
to increase. However, during the first quarter the costs associated
with expanding these programs had a negative effect on profits.
Our BMP arrangement at St. Vincent's Hospital in Worcester,
Massachusetts requires us to supply all of the hospital's blood needs at
fixed prices. Blood that we are unable to collect in the donor center
or in mobile blood drives must be purchased from regional blood
providers at market prices. During the first quarter of 2001, the
hospital's demand for blood significantly increased compared to
historical consumption levels. As a result, we were required to
purchase significant amounts of blood products from other blood centers,
including the ARC in Massachusetts, to meet the hospitals needs. Blood
product prices charged to us by the ARC significantly exceeds the prices
we pay other blood centers and the prices we receive for such products
from St. Vincent's. As a result this program generated a small loss in
the first quarter of 2001. The BMP arrangement with St. Vincent's is
currently being renegotiated; we anticipate that the new arrangement
will be profitable.
General and Administrative Expenses
------------------------------------
General and administrative expenses were $845,000 for 2001, compared to
$891,000 for 2000. The decrease of $46,000 (5%) reflects a reduction in
professional and consulting fees in 2001. General and administrative
expenses as a percentage of revenue were 14% in 2001 and 18% in 2000.
The lower percentage reflects economies of scale associated with greater
sales volumes.
Provision for income taxes
--------------------------
Prior to 1997 we incurred operating losses that are used to offset
current income for income tax purposes. During the fourth quarter of
2000, we recorded a deferred tax asset for the expected future tax
benefit of the net operating loss carryforwards. In 2001, we are
reporting income tax expense at our effective tax rate for financial
reporting purposes. Income tax expense reduces our deferred tax
assets. The amount of the tax benefit as of March 31, 2001 and
December 31, 2000, is $2,972,000 and $3,093,000, respectively.
Of this amount, $1,239,000 is recorded as a current asset as of
March 31, 2001 and December 31, 2000, and $1,733,000 and
$1,854,000 as of March 31, 2001 and December 31, 2000, respectively
are recorded as non-current assets. We will continue to
use our net operating losses to offset future taxable income and
minimize the amount of taxes we pay to the federal and state agencies.
Liquidity and Capital Resources
-------------------------------
At March 31, 2001, HemaCare had cash and cash equivalents and
marketable securities of $1,246,000 and working capital of $5,133,000.
We have two lines of credit with a commercial bank. The first line of
credit is a working capital line. We can borrow the lesser of 75% of
eligible accounts receivable or $2.0 million. Interest is payable
monthly at a rate of prime plus 0.25% (8.25% as of March 31, 2001). The
second line of credit provides $350,000 for equipment purchases.
Periodically, we can convert equipment purchase loans into a long-term,
fully amortized note payable. The note requires monthly payments
including interest equal to the bank's internal cost of funds plus 3%
(8% as of March 31, 2001). These lines of credit are secured by
substantially all of our unencumbered assets and require us to maintain
certain financial covenants. These lines of credit mature on June 30,
2002. As of March 31, 2003, we were in compliance with these
covenants.
In March 2001, we used our equipment line of credit to purchase
equipment and have converted the obligation to a long-term note
payable. As of March 31, 2001 the outstanding balance is $114,000.
The note requires 48 monthly principal payments of $2,428.02
plus interest at the fixed rate of 8.3%. The loan is secured
by two vehicles with a cost of approximately $80,000 and
requires us to maintain certain financial covenants. As of
March 31, 2001 we were in compliance with all of the covenants.
During the first quarter of 2001, we experienced an increase in our
accounts receivable balances. As of December 31, 2000, accounts
receivable were collected in an average of 63 days. As of March 31,
2001, accounts receivable were collected in an average of 72 days.
During April, our accounts receivable collections improved and days
sales outstanding returned to levels consistent with 2000 and
prior years.
In July 2000, we announced our intention to repurchase up to 15% of our
outstanding common stock, or up to 1.1 million shares. Purchases are
made in the open market or in private transactions depending on price
and availability. We are funding the purchases from cash and cash
equivalents and marketable securities along with profits generated in
the normal course of business. For the three months ended March 31,
2001, we repurchased an additional 293,000 shares at an average price of
$1.15 per share. In total, HemaCare has repurchased 725,000 shares
at an average price of $1.36 per share through March 31, 2001.
Since 1976, California law has prohibited the infusion of blood products
into patients if the donors of those products were paid unless, in the
opinion of the recipient's physician, blood from a non-paid donor was
not immediately available. Apheresis platelet products obtained from
paid donors, including our Sherman Oaks center's paid donors, have been
exempted from this law by a series of state statutes. Unless a new
exemption is obtained, the existing exemption will expire on December
31, 2002. This could have a material adverse effect on HemaCare's
revenue and net income. Revenue from paid platelet donors in the
first quarter of 2001 was $1,494,000.
We anticipate that positive cash flow from our operations, cash and
investments on hand and borrowing from the bank lines of credit will be
sufficient to provide funding for our current operating needs.
Factors Affecting Forward-Looking Information
---------------------------------------------
The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" from liability for forward-looking statements. Certain
information included in this Form 10-Q and other materials filed or to
be filed by our Company with the Securities and Exchange Commission (as
well as information included in oral statements or other written
statements made or to be made by or on behalf of our Company) are
forward-looking, such as statements relating to operational and
financing plans, competition, the impact of future price increases for
blood products, demand for our Company's products and services, and the
anticipated outcome of litigated matters. Such forward-looking
statements involve important risks and uncertainties, many of which will
be beyond the control of our Company. These risks and uncertainties
could significantly affect anticipated results in the future, both
short-term and long-term, and accordingly, such results may differ from
those expressed in forward-looking statements made by or on behalf of
our Company. These risks and uncertainties include, but are not limited
to, those relating to the ability of our Company to develop and market
profitable outsourcing programs, obtain additional financing, to
maintain profitability in certain Blood Management Programs centers, to
continue its practice of compensating its donors, to retain existing
customers, to improve the profitability of our Company's other
operations, to expand its operations, to renew and comply with the
covenants under its bank lines of credit and to effectively compete
against the ARC and other competitors. Each of these risks and
uncertainties as well as others are discussed in greater detail in the
10-K and Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Item 3. Qualitative and Quantitative Disclosure About Market Risk
------- ---------------------------------------------------------
None
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
See disclosure in Form 10-K for the year ended
December 31, 2000.
Item 2. Changes in Securities and Use of Proceeds - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
11 Net Income per Common and Common Equivalent Share
b. HemaCare did not file any reports on Form 8-K during the
three months ended March 31, 2001.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Date: May 15, 2001 HEMACARE CORPORATION
(Registrant)
/s/ David E. Fractor
--------------------------
David E. Fractor, Chief
Financial Officer
(Duly authorized officer and
principal financial and
accounting officer)