Back to GetFilings.com



 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

 

 

ý

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

 

For the Quarterly Period Ended September 30, 2003

 

 

 

OR

 

 

 

o

 

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 0-23181

 

PAULA FINANCIAL

(Exact name of registrant as specified in its charter)

 

Delaware

 

95-4640638

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
identification number)

 

 

 

PAULA FINANCIAL

87 East Green Street, Suite 206

Pasadena, CA 91105

(Address of principal executive offices, zip code)

 

 

 

(626) 844-7100

(Registrant’s telephone number, including area code)

 

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   ý

 

No   o

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

 

Yes   o

 

No   ý

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.  Number of shares of Common Stock, $.01 par value, outstanding as of close of business on October 31, 2003: 6,239,879 shares.

 

 

 

PAULA FINANCIAL

INDEX TO FORM 10-Q

 

PART I. FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements

 

 

 

 

 

Condensed consolidated balance sheets as of
September 30, 2003 and December 31, 2002 (unaudited)

 

 

 

 

 

Condensed consolidated statements of income for the three
and nine months ended September 30, 2003 and 2002 (unaudited)

 

 

 

 

 

Condensed consolidated statements of cash flows for the nine months
ended September 30, 2003 and 2002 (unaudited)

 

 

 

 

 

Notes to condensed consolidated financial statements for the three
and nine months ended September 30, 2003 (unaudited)

 

 

 

 

Item 2.

Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

 

 

 

 

Item 4.

Controls and Procedures

 

 

 

 

PART II. OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

 

 

 

 

Item 5.

Other Information

 

 

 

 

Item 6.

Exhibits and Reports on Form 8-K

 

 

 

 

SIGNATURE

 

 

 

PART I                               FINANCIAL INFORMATION

Item 1.                                     Financial Statements

 

PAULA FINANCIAL AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share data)

 

 

 

September 30,
2003

 

December 31,
2002

 

 

 

(Unaudited)

 

(*)

 

Assets

 

 

 

 

 

Current Assets:

 

 

 

 

 

Cash (restricted: 2003, $2,622; 2002, $851)

 

$

3,162

 

$

1,290

 

Accounts receivable, net of allowance for uncollectible accounts (2003, $80; 2002, $140)

 

1,046

 

875

 

Commissions receivable

 

2,451

 

1,284

 

Income tax receivable

 

—

 

141

 

Other receivables

 

84

 

92

 

Deferred income taxes

 

1,352

 

1,274

 

Other assets

 

277

 

262

 

 

 

8,372

 

5,218

 

Non-Current Assets:

 

 

 

 

 

Property and equipment, net

 

262

 

266

 

Investment in related party

 

703

 

703

 

Goodwill

 

1,940

 

1,452

 

Other amortizable intangible assets, net

 

2,503

 

1,194

 

Deferred income taxes

 

4,799

 

5,368

 

Other assets

 

172

 

99

 

 

 

$

18,751

 

$

14,300

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

Due to underwriters and assureds

 

$

3,678

 

$

1,890

 

Accounts payable and accrued expenses

 

957

 

760

 

Employment related accrued expenses

 

798

 

403

 

Acquisition related accruals

 

891

 

238

 

Income tax payable

 

116

 

—

 

Notes payable to bank

 

1,300

 

1,300

 

 

 

7,740

 

4,591

 

Non-Current Liabilities:

 

 

 

 

 

Acquisition related accruals

 

1,745

 

600

 

Notes payable to bank

 

476

 

1,450

 

 

 

$

9,961

 

$

6,641

 

 

 

 

 

 

 

Stockholders’ Equity:

 

 

 

 

 

Preferred stock, $0.01 par value.  (Authorized 4,058,823 shares, none issued and outstanding)

 

$

—

 

$

—

 

Common stock, $0.01 par value (Authorized 15,000,000 shares, issued: 2003  7,127,029; 2002  7,023,379)

 

71

 

70

 

Additional paid-in-capital

 

13,960

 

68,294

 

Accumulated earnings (deficit), after January 1, 2003, net of $54,405  deficit eliminated)

 

885

 

(54,405

)

Unearned compensation

 

(41

)

(26

)

Employee loans for stock purchase

 

(189

)

(397

)

 

 

14,686

 

13,536

 

Treasury stock, at cost (2003, 887,150; 2002, 873,500 shares)

 

(5,896

)

(5,877

)

 

 

8,790

 

7,659

 

 

 

$

18,751

 

$

14,300

 

 

*  Derived from audited financial statements.

 

See notes to condensed consolidated financial statements.

 

2

 

PAULA FINANCIAL AND SUBSIDIARIES

Condensed Consolidated Statements of Income
(In thousands, except share and per share data)

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

 

2003

 

2002

 

2003

 

2002

 

 

 

(Unaudited)

 

(Unaudited)

 

Income:

 

 

 

 

 

 

 

 

 

Commissions

 

$

4,458

 

$

3,312

 

$

11,980

 

$

8,244

 

Contingent commissions

 

543

 

156

 

1,725

 

1,247

 

Net investment income

 

1

 

20

 

5

 

28

 

Service fees

 

226

 

12

 

418

 

47

 

Other

 

2

 

20

 

20

 

126