UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Form 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): May 24, 2004 LanVision Systems, Inc. ----------------------- (Exact name of registrant as specified in its charter) Delaware 0-28132 31-1455414 - -------------------------------------------------------------------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 5481 Creek Road, Cincinnati, OH 45242-4001 - -------------------------------------------------------------------------------- (Address of principal executive offices) Registrant's telephone number, including area code (513) 794-7100 ----------------------------- Item 12: RESULTS OF OPERATIONS AND FINANCIAL CONDITION On May 24, 2004, LanVision Systems, Inc. ("LanVision") issued the press release attached hereto as Exhibit 99.1, which press release contains financial information about LanVision's first fiscal quarter ended April 30, 2004. The information hereunder shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. SIGNATURES Pursuant to the requirements of the Securities Act of 1934, registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. LanVision Systems, Inc. Date: May 24, 2004 By: /s/ Paul W. Bridge, Jr. ----------------------- Paul W. Bridge, Jr. Chief Financial Officer INDEX TO EXHIBITS Exhibit No. Description of Exhibit 99.1 News Release of LanVision Systems, Inc. Dated May 24, 2004 First Quarter Earnings News Release 2
Exhibit 99.1 LANVISION SYSTEMS, INC. News Release of LanVision Systems, Inc. Dated May 24, 2004 NEWS RELEASE Visit our web site at: www.lanvision.com ----------------- COMPANY CONTACT: PAUL W. BRIDGE, JR. CHIEF FINANCIAL OFFICER (513) 794-7100 FOR IMMEDIATE RELEASE - --------------------- LANVISION SYSTEMS, INC. REPORTS FIRST QUARTER 2004 RESULTS - ---------------------------------------------------------- Cincinnati, Ohio, May 24, 2004 --- LanVision Systems, Inc. (Nasdaq: LANV) today announced the operating results for the first quarter ended April 30, 2004. Revenues for the first quarter ended April 30, 2004 were $2.64 million, which was approximately the same as the first quarter of last year. A decline in systems sales over the prior comparable quarter was offset by a 48% increase in ASPeN(SM) application-hosting revenues and a 10% increase services maintenance and support revenues of $205,000 and $152,000, respectively. The operating loss for the first quarter improved by 83% to $42,000, compared with an operating loss of $248,000 in the first quarter of last year. The net loss for the first quarter improved by 38% to $421,000, or $0.05 per basic and diluted share, when compared with a net loss of $675,800, or $0.07 per basic and diluted share in the first quarter of last year. Both the operating results and net loss were in line with management's expectations. J. Brian Patsy, president and chief executive officer, stated, "Traditionally, our annual revenues are back-end loaded and our first quarter is the most challenging of the year. We believe fiscal 2004 will follow this same historical pattern. Although first quarter's revenues were affected by delays in signing anticipated new perpetual license contracts, we continue to anticipate annual revenue growth with increasing operating margins from our very profitable ASPeN application-hosting services. In addition, demand for Medical Record Workflow technologies and healthcare information access systems is growing and our strategic distribution partners are providing an increasing number of sales leads and opportunities." "During our first quarter", Mr. Patsy continued, "we successfully implemented and put into production our accessANYware(TM) suite of medical record and patient financial services 3 workflows at Pattie A. Clay Regional Medical Center via our remote ASPeN hosting center. Now that we have a very satisfied, showcase hospital in the small to medium-sized segment of the healthcare market, we intend to aggressively promote our success to take advantage of what we believe are substantial opportunities to provide affordable workflow and document management application hosting services to similarly sized healthcare organizations. In addition, during our first quarter we also completed implementation and put into production our codingANYware(TM) solution at a federal government military facility. We are excited about the market potential to expand our services throughout other federal government facilities via our remote ASPeN hosting center." Mr. Patsy concluded, "We continue to closely monitor our expenses, which has enabled us to maintain our services, maintenance and support gross margin in the 60% range and enabled us to almost double our application-hosting margin contribution to $416,000 or a 66% gross margin, when compared to the prior comparable period. The addition of new application-hosting clients generate increasing margins as new clients do not require corresponding increases in operating expenses as the current system is capable of handling additional volume without major increases in capital assets. Finally, over the last 12 months, we have reduced our long-term debt by $2,000,000, and made a discretionary $1,500,000 payment on the deferred interest in the first quarter of the current year. We continue our efforts to improve both our profitability and our balance sheet. Our cash balance of $4,511,000 is only $610,000 less than a year ago notwithstanding that our debt has been significantly reduced during that period. We anticipate refinancing in the range of $3,000,000 of accrued and unpaid interest on our long term debt on schedule in July 2004, at a significantly lower interest rate than the current debt." CONFERENCE CALL INFORMATION The first quarter conference call will be held at 10:00 a.m. Eastern Time, on Tuesday May 25, 2004. The call will feature remarks from J. Brian Patsy, President and Chief Executive Officer, and Paul W. Bridge, Jr., Chief Financial Officer. To access the call, dial 703-464-5641 approximately five minutes prior to the start of the call. To access the call via the webcast, go to www.lanvision.com before the call is scheduled to begin. The webcast will also be available on our web site for the 90 days. ABOUT LANVISION SYSTEMS LanVision is a healthcare information technology company focused on digitally streamlining healthcare by providing solutions that improve document-centric information flows while complementing and enhancing existing transaction-centric healthcare information systems. The Company's workflow and document management solutions bridge the gap between current, inefficient paper-based processes and transaction-based healthcare information systems by 1) electronically capturing document-centric information from disparate sources, 2) electronically directing that information through vital business processes, and 3) providing access to the information for authenticated users (such as physicians, nurses, administrative and financial personnel and payers) across the continuum of care. 4 The company's workflow-based products and services offer unique solutions to specific healthcare business processes within the Medical Record life cycle and the revenue cycle, such as remote coding, abstracting and chart completion, remote physician order processing, pre-admission registration scanning, insurance verification, denial management, secondary billing services, explanation of benefits processing and release of information processing. LanVision's products and services also create an integrated document-centric repository of historical health information that is complementary and can be seamlessly "bolted on" to existing transaction-centric clinical, financial and management information systems, allowing healthcare providers to aggressively move toward fully Electronic Medical Record processes while improving service levels and convenience for all stakeholders. These integrated systems allow providers and administrators to dramatically improve the availability of patient information while decreasing direct costs associated with document retrieval, work-in-process, chart completion, document retention and archiving. LanVision's systems can be provided on a subscription basis via remote hosting services or installed locally. LanVision provides ASPeN, ASP-based remote hosting services to The University Hospital, a member of The Health Alliance of Greater Cincinnati, M. D. Anderson Cancer Center and Children's Medical Center of Columbus, Ohio among others. In addition, LanVision has installed its workflow and document management solutions at leading healthcare providers including Stanford Hospital and Clinics, the Albert Einstein Healthcare Network, ProMedica Health System, Inc., the University of Pittsburgh Medical Center, Medical University Hospital Authority of South Carolina, and Memorial Sloan-Kettering Cancer Center. For additional information on LanVision, please visit our website at www.lanvision.com. SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 STATEMENTS MADE BY LANVISION THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING STATEMENTS THAT ARE SUBJECT TO RISKS AND UNCERTAINTIES. THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE REFLECTED IN THE FORWARD-LOOKING STATEMENTS, INCLUDED HEREIN. THESE RISKS AND UNCERTAINTIES INCLUDE, BUT ARE NOT LIMITED TO, THE IMPACT OF COMPETITIVE PRODUCTS AND PRICING, PRODUCT DEMAND AND MARKET ACCEPTANCE, NEW PRODUCT DEVELOPMENT, KEY STRATEGIC ALLIANCES WITH VENDORS THAT RESELL LANVISION PRODUCTS, THE ABILITY OF THE COMPANY TO CONTROL COSTS, AVAILABILITY OF PRODUCTS PRODUCED FROM THIRD PARTY VENDORS, THE HEALTHCARE REGULATORY ENVIRONMENT, HEALTHCARE INFORMATION SYSTEMS BUDGETS, AVAILABILITY OF HEALTHCARE INFORMATION SYSTEMS TRAINED PERSONNEL FOR IMPLEMENTATION OF NEW SYSTEMS, AS WELL AS MAINTENANCE OF LEGACY SYSTEMS, FLUCTUATIONS IN OPERATING RESULTS AND OTHER RISKS DETAILED FROM TIME TO TIME IN THE LANVISION SYSTEMS, INC. FILINGS WITH THE U. S. SECURITIES AND EXCHANGE COMMISSION. READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH REFLECT MANAGEMENT'S ANALYSIS ONLY AS OF THE DATE HEREOF. THE COMPANY UNDERTAKES NO OBLIGATION TO PUBLICLY RELEASE THE RESULTS OF ANY REVISION TO 5 THESE FORWARD-LOOKING STATEMENTS, WHICH MAY BE MADE TO REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE HEREOF OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS. (C)2004 LanVision Systems, Inc., Cincinnati, OH 45242. All rights reserved. TABLES FOLLOW 6 LANVISION SYSTEMS, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS 7
UNAUDITED Three Months Ended April 30, ----------------------------- 2004 2003 ---- ---- Revenues: Systems sales $ 286,883 $ 622,496 Services, maintenance and support 1,721,658 1,569,244 Application-hosting services 633,014 428,242 ----------- ----------- Total revenues 2,641,555 2,619,982 Operating expenses: Cost of systems sales 358,912 462,463 Cost of services, maintenance and support 680,245 662,877 Cost of application-hosting services 216,648 215,368 Selling, general and administrative 913,468 944,198 Product research and development 513,999 583,093 ----------- ----------- Total operating expenses 2,683,272 2,867,999 ----------- ----------- Operating (loss) (41,717) (248,017) Other income (expense): Interest income 24,102 19,034 Interest (expense) (403,449) (446,809) ----------- ----------- (Loss) before income taxes (421,064) (675,792) Income tax provision (benefit) - - =========== =========== Net (loss) $ (421,064) $ (675,792) =========== =========== Basic net (loss) per common share $ (0.05) $ (0.07) =========== =========== Diluted net (loss) per common share $ (0.05) $ (0.07) =========== =========== Number of shares used in basic per common share computation 9,035,897 8,964,449 =========== =========== Number of shares used in diluted per common share computation 9,035,897 8,964,449 =========== =========== LANVISION SYSTEMS, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEETS # # # 8
UNAUDITED April 30, ---------------------------------- Assets 2004 2003 ------ ---- ---- Current assets: Cash and cash equivalents (restricted by long-term debt agreement) $ 4,511,161 $ 5,121,274 Accounts receivable, net of allowance for doubtful accounts of $400,000, respectively 1,864,025 1,562,504 Unbilled receivables 1,821,384 3,408,451 Other 351,913 330,689 ------------ ------------ Total current assets 8,548,483 10,422,918 Property and equipment: Computer equipment 2,623,435 2,371,688 Computer software 866,430 760,827 Office furniture, fixtures and equipment 1,167,497 1,154,795 Leasehold improvements 157,492 157,227 ------------ ------------ 4,814,854 4,444,537 Accumulated depreciation and amortization (3,803,357) (3,280,316) ------------ ------------ 1,011,497 1,164,221 Capitalized software development costs, net of accumulated amortization of $2,758,478 and $2,225,228, respectively 1,781,451 1,464,701 Installment receivables -- 433,339 Other, including deferred federal tax assets 624,300 48,598 ------------ ------------ $ 11,965,731 $ 13,533,777 ============ ============ Liabilities and stockholders' equity Current liabilities: Accounts payable $ 241,522 $ 550,475 Accrued compensation 230,752 239,936 Accrued other expenses 782,404 1,274,691 Deferred revenues 1,690,746 1,646,928 Current portion of capitalized leases 223,890 209,498 Current portion of long-term debt 500,000 2,000,000 Long-term debt deferred interest 3,491,176 -- ------------ ------------ Total current liabilities 7,160,490 5,921,528 Non-current portion of capitalized leases 110,745 334,634 Long-term debt -- 500,000 Long-term debt deferred interest -- 3,470,290 Stockholders' equity: Preferred stock, $0.01 par value per share, 5,000,000 shares authorized, no shares issued -- -- Common stock, $0.01 par value per share, 25,000,000 shares authorized, 9,060,233 and 8,977,670 shares issued, respectively 90,602 89,777 Capital in excess of par value 34,964,286 34,851,833 Accumulated (deficit) (30,360,392) (31,634,285) ------------ ------------ Total stockholders' equity 4,694,496 3,307,325 ------------ ------------ $ 11,965,731 $ 13,533,777 ============ ============