----

****

**SECURITIES AND EXCHANGE COMMISSION**Washington, DC20549

  

**Form10‐Q**

QuarterlyReport Under Section 13 or 15(d)of the Securities Exchange Act of 1934

  
| For QuarterEnded March 31, 2002     |                                                        | CommissionFile Number 0‐8640 |
|---------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|

**  **

**SYNCORINTERNATIONAL CORPORATION**(Exact name ofregistrant as specified in its charter)

|                                                   |                                                       |                                     |
|---------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------|
| **Delaware**                                      |                                                                                                                                                                                                                                                                                                                                | **85‐0229124**                |
| (State orother jurisdiction of                    |                                                                                                                                                                                                                                                                                                                                | (I.R.S.Employer Identification No.) |
| incorporation or organization)                    |                                                                                                                                                                                                                                                                                                                                |                                     |
|                                         |                                                                                                                                                                                                                                                                                                                                |                                     |
| **6464Canoga Avenue, Woodland Hills, California** |                                                                                                                                                                                                                                                                                                                                | **91367**                           |
| (Address ofprincipal executive offices)           |                                                                                                                                                                                                                                                                                                                                | (ZipCode)                           |
|                                                   |                                                                                                                                                                                                                                                                                                                                |                                     |

  

**(818)737-4000**(Registrant'stelephone number, including area code)

  

Indicate by check markwhether the Registrant (1) has filed all reports required to befiled by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that theRegistrant was required to file such reports), and (2) has beensubject to such filing requirements for the past 90days.

**Yes   X    No       **

  

Indicate the number ofshares outstanding of each of the issuer's classes of common stock,as of the latest practicable date.  As of April 30, 2002,24,778,273 shares of $.05 par value common stock wereoutstanding.

----

****

**SYNCORINTERNATIONAL CORPORATION AND SUBSIDIARIES**

****

**INDEX**
|             |                                                                                                                                                      |                             | **Page** |
|--------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    | PartI.   Financial Information                                                                                                        |                                                                                                                                                                    |          |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |        Item 1.  Condensed Consolidated FinancialStatements                                                   |                                                                                                                                                                    |          |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |              Balance Sheets as of March 31, 2002 and December 31,2001               |                                                                                                                                                                    | 3        |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |              Statements of Income for Three Months Ended March 31,2002 and 2001     |                                                                                                                                                                    | 4        |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |              Statements of Cash Flows for Three Months Ended March31, 2002 and 2001 |                                                                                                                                                                    | 5        |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |              Notes to Condensed Consolidated FinancialStatements                    |                                                                                                                                                                    | 6        |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |        Item 2.  Management's Discussion and Analysisof Financial Condition                                   |                                                                                                                                                                    | 10       |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    |        Item 3.  Quantitative and Qualitative Disclosuresabout Market Risk                                    |                                                                                                                                                                    | 13       |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    | PartII.  Other Information                                                                                                                 |                                                                                                                                                                    | 14       |
|                                                          |                                                                                                                                                      |                                                                                                                                                                    |          |
|                                                                    | SIGNATURE                                                                                                                                            |                                                                                                                                                                    | 15       |

2

----

**Item 1.**

****

**SYNCOR INTERNATIONAL CORPORATION ANDSUBSIDIARIESCondensed Consolidated Balance Sheets****(Unaudited)**(inthousands)
|                                                                                                                | **         ** | **March31, 2002**       | **     ** | **December31, 2001** |   |
|----------------------------------------------------------------------------------------------------------------|------------------------------------------------------------|-------------------------|------------------------------------|----------------------|---|
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
| **ASSETS**                                                                                                     |                                                            |                         |                                    |                      |   |
| Current assets:                                                                                                |                                                            |                         |                                    |                      |   |
|        Cashand cash equivalents                                             |                                                            | **$  14,682** |                                    | $  17,634  |   |
|        Short‐terminvestments                                          |                                                            | **9,393**               |                                    | 11,908               |   |
|        Tradereceivables, net                                                |                                                            | **109,613**             |                                    | 102,759              |   |
|       Patient receivables, net                                                   |                                                            | **57,916**              |                                    | 52,944               |   |
|        Inventory                                                            |                                                            | **28,339**              |                                    | 30,630               |   |
|        Prepaidsand other current assets                                     |                                                            | **27,485**              |                                    | 31,521               |   |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
|             Total curentassets                     |                                                            | **247,428**             |                                    | 247,396              |   |
|                                                                                                      |                                                            |                         |                                    |                      |   |
| Marketable investmentsecurities                                                                                |                                                            | **1,006**               |                                    | 1,006                |   |
| Property and equipment,net                                                                                     |                                                            | **180,896**             |                                    | 177,364              |   |
| Excess of purchase priceover net assets acquired, net                                                          |                                                            | **143,160**             |                                    | 141,333              |   |
| Other assets                                                                                                   |                                                            | **21,881**              |                                    | 20,742               |   |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
|                                                    |                                                            | **$594,371**            |                                    | $587,841             |   |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
|                                                                                                                |                                                            |                         |                                    |                      |   |
| **LIABILITIES ANDSTOCKHOLDERS' EQUITY**                                                                        |                                                            |                         |                                    |                      |   |
| Currentliabilities:                                                                                            |                                                            |                         |                                    |                      |   |
|        Accountspayable                                                      |                                                            | **$  65,893** |                                    | $  65,853  |   |
|        Accruedliabilities                                                   |                                                            | **28,803**              |                                    | 26,858               |   |
|        Accruedwages and related costs                                       |                                                            | **16,702**              |                                    | 16,427               |   |
|        Federaland state taxes payable                                       |                                                            | **9,950**               |                                    | 6,482                |   |
|        Currentmaturities of long-term debt                                  |                                                            | **12,371**              |                                    | 16,048               |   |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
|             Totalcurrent liabilities:              |                                                            | **133,719**             |                                    | 131,668              |   |
|                                                                                                      |                                                            |                         |                                    |                      |   |
| Long-term debt, net ofcurrent maturities                                                                       |                                                            | **203,973**             |                                    | 210,649              |   |
| Deferred taxes                                                                                                 |                                                            | **11,187**              |                                    | 10,696               |   |
|                                                                                                                |                                                            |                         |                                    |                      |   |
| Stockholders'equity:                                                                                           |                                                            |                         |                                    |                      |   |
|        Commonstock, $.05 par value                                          |                                                            | **1,425**               |                                    | 1,420                |   |
|        Additionalpaid-in capital                                            |                                                            | **126,251**             |                                    | 124,909              |   |
|        Notesreceivable-related parties                                      |                                                            | **(3,461**              | **)**                              | (6,197               | ) |
|        Accumulatedother comprehensive income                                |                                                            | **(3,584**              | **)**                              | (3,653               | ) |
|        Retainedearnings                                                     |                                                            | **162,797**             |                                    | 151,888              |   |
|        Treasurystock, at cost; 3,750 shares at March 31, 2002 and           |                                                            |                         |                                    |                      |   |
|              3,575shares at December 31, 2001 |                                                            | **(37,936**             | **)**                              | (33,539              | ) |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
|                                                                                                                |                                                            |                         |                                    |                      |   |
|             Totalstockholders' equity              |                                                            | **245,492**             |                                    | 234,828              |   |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |
|                                                                                                                |                                                            | **$594,371**            |                                    | $587,841             |   |
|                                                                                                                |                                                            | ****                    |                                    |                      |   |

  

*See notes to condensedconsolidated financial statements.*

3

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**SYNCOR INTERNATIONAL CORPORATIONAND SUBSIDIARIESCondensedConsolidated Statements of Income(Unaudited)**(in thousands,except per share data)
|                                                                                                                                                                                                                                                                                                                                                                            |                                | **THREEMONTHS ENDED MARCH 31, ** |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|---------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |       | **2002**                              |       | 2001 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
|                                                                                                                                                                                                                                                                                                                                                                  |                                |                                       |  |  |  |   |
| Net sales                                                                                                                                                                                                                                                                                                                                                                  |                                | **$215,484**                          |  | $181,416 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
| Cost of sales                                                                                                                                                                                                                                                                                                                                                              |                                | **133,029**                           |  | 112,727 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
|        Grossprofit                                                                                                                                                                                                                                                                                                                      |                                | **82,455**                            |  | 68,689 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
| Operating, selling andadministrativeexpenses                                                      |                                | **51,007**                            |  | 39,011 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
| Depreciation andamortization                                                                                                                                                                                                                                                                                                                                               |                                | **10,140**                            |  | 8,659 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
|        Operatingincome                                                                                                                                                                                                                                                                                                                  |                                | **21,308**                            |  | 21,019 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
| Other expense,net                                                                                                                                                                                                                                                                                                                                                          |                                | **(3,569**                            | ) | (4,008 | ) |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
| Income beforetaxes                                                                                                                                                                                                                                                                                                                                                         |                                | **17,739**                            |  | 17,011 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
| Provision for incometaxes                                                                                                                                                                                                                                                                                                                                                  |                                | **6,830**                             |  | 6,804 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
| Net income                                                                                                                                                                                                                                                                                                                                                                 |                                | **$10,909**                           |  | $10,207 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                |                                       |  |  |  |   |
| Net income per share– Basic                                                                                                                                                                                                                                                                                                                                          |                                | **$0.44**                             |  | $0.42 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
| Weighted average sharesoutstanding – Basic                                                                                                                                                                                                                                                                                                                           |                                | **24,766**                            |  | 24,473 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
| Net income per share– Diluted                                                                                                                                                                                                                                                                                                                                        |                                | **$0.41**                             |  | $0.38 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |
| Weighted average sharesoutstanding – Diluted                                                                                                                                                                                                                                                                                                                         |                                | **26,732**                            |  | 27,101 |  |   |
|                                                                                                                                                                                                                                                                                                                                                                            |                                | ****                                  |  |  |  |   |

**  **

*See notes to condensedconsolidated financial statements.*

4

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**SYNCOR INTERNATIONAL CORPORATION ANDSUBSIDIARIESCondensed Consolidated Statements of Cash Flows(Unaudited)******(in thousands)

****
|                                                                                                                      | **THREEMONTHS ENDED MARCH 31,** |
|----------------------------------------------------------------------------------------------------------------------|---------------------------------|
|                                                                                                                      | **  **                | **2002** |  | 2001 |  |   |
|                                                                                                                      |                                 |  |  | **** |  |   |
| Cash flows from operatingactivities:                                                                                 |                                 |  |  |  |  |   |
|                                                                                                                      |                                 |  |  |  |  |   |
| Net income                                                                                                           |                                 | **$10,909** |  | $10,207 |  |   |
| Adjustments to reconcilenet income to net                                                                            |                                 |  |  |  |  |   |
|     cash provided by (usedin) operating activities:                                              |                                 |  |  |  |  |   |
|         Depreciationand amortization                                         |                                 | **10,140** |  | 8,659 |  |   |
|         Provisionfor losses on receivables                                   |                                 | **2,557** |  | 1,882 |  |   |
|         Amortizationof loan guarantee                                        |                                 | **-** |  | 421 |  |   |
|         Changesin operating assets and liabilities, net ofacquisitions:      |                                 |  |  |  |  |   |
|               Tradereceivables                 |                                 | **(7,258** | **)** | (8,180 | ) |   |
|               Patientreceivables               |                                 | **(7,128** | **)** | (10,630 | ) |   |
|               Inventory                        |                                 | **2,350** |  | 37,225 |  |   |
|               Prepaidsand other current assets |                                 | **3,874** |  | (4,279 | ) |   |
|               Otherassets                      |                                 | **(910** | **)** | 619 |  |   |
|               Accountspayable                  |                                 | **212** |  | (53,025 | ) |   |
|               Accruedliabilities               |                                 | **2,269** |  | (265 | ) |   |
|               Accruedwages and related costs   |                                 | **279** |  | (6,480 | ) |   |
|               Federaland state taxes payable   |                                 | **4,152** |  | 5,651 |  |   |
|               Deferredtaxes                    |                                 | **491** |  | 1,102 |  |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
|     Net cash provided by(used in) operating activities                                           |                                 | **21,937** |  | (17,093 | ) |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
| Cash flows from investingactivities:                                                                                 |                                 |  |  |  |  |   |
|                                                                                                                      |                                 |  |  |  |  |   |
|         Purchaseof property and equipment, net                               |                                 | **(8,995** | **)** | (10,219 | ) |   |
|         Acquisitionsof businesses, net of cash acquired                      |                                 | **(1,747** | **)** | (15,678 | ) |   |
|         Netdecrease (increase) in short-term investments                     |                                 | **2,522** |  | (1,569 | ) |   |
|         Netincrease in long-term investment                                  |                                 | **-** |  | (2 | ) |   |
|         Unrealizedgain on investments                                        |                                 | **-** |  | 3 |  |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
|         Netcash used in investing activities                                 |                                 | **(8,220** | **)** | (27,465 | ) |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
| Cash flow from financingactivities:                                                                                  |                                 |  |  |  |  |   |
|                                                                                                                      |                                 |  |  |  |  |   |
|         Proceedsfrom long-term debt                                          |                                 | **1,172** |  | 38,688 |  |   |
|         Repaymentof long-term debt                                           |                                 | **(16,188** | **)** | (1,104 | ) |   |
|         Notesreceivable-related parties                                      |                                 | **2,736** |  | 5,489 |  |   |
|         Issuanceof common stock                                              |                                 | **510** |  | 2,288 |  |   |
|         Reacquisitionof common stock for treasury                            |                                 | **(4,397** | **)** | (5,893 | ) |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
|         Netcash (used in) provided by financing activities                   |                                 | **(16,167** | **)** | 39,468 |  |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
|         Netdecrease in cash and cash equivalents                             |                                 | **(2,450** | **)** | (5,090 | ) |   |
|                                                                                                                      |                                 |  |  |  |  |   |
|         Effectof exchange rate on cash                                       |                                 | **(502** | **)** | 247 |  |   |
|                                                                                                                      |                                 |  |  |  |  |   |
|         Cashand cash equivalents at beginning of period                      |                                 | **17,634** |  | 24,330 |  |   |
|                                                                                                                      |                                 | **** |  |  |  |   |
|         Cashand cash equivalents at end of period                            |                                 | **$14,682** |  | $19,487 |  |   |
|                                                                                                                      |                                 | **** |  |  |  |   |

  

*See notes to condensedconsolidated financial statements.*

**

5

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**SYNCOR INTERNATIONAL CORPORATION ANDSUBSIDIARIESNotes to Condensed ConsolidatedFinancial Statements**

****

1.            **GENERAL.**  The accompanying unaudited condensedconsolidated financial statements have been prepared in accordancewith accounting principles generally accepted in the United Statesof America for interim financial information and with theinstructions to Form 10‐Q.  Accordingly, they do notinclude all of the information and footnotes required by accountingprinciples generally accepted in the United States of America forcomplete financial statements.  In the opinion of management,all adjustments (consisting only of normal recurring accruals)considered necessary for a fair presentation have been included.The results for the three months ended March 31, 2002, are notnecessarily indicative of the results to be expected for the fullyear.  For further information, refer to the consolidatedfinancial statements and footnotes thereto included in our AnnualReport on Form 10-K for the year ended December 31, 2001. Certainline items in the prior year’s consolidated condensedfinancial statements have been reclassified to conform to thecurrent year’s presentation.

****

2.**            SUMMARY OF CRITICAL ACCOUNTING POLICIES.**

Our criticalaccounting policies are as follows:

******

**RevenueRecognition*.***We recognize our revenue primarily from twosources: (i) product revenue, which includes sales from ourradiopharmacies and (ii) services revenue, primarily from ourimaging business. As described below, significant judgments andestimates must be used by management in connection with the revenuerecognized in any period for the imaging business. Materialdifferences may impact the amount of revenue recorded in any periodif management judgments or estimates are significantly differentthan actual.

We provide imagingservices to patients that generally have medical insurance througha governmental payor, managed care payor, or a commercialthird-party payor.  Our Medical Imaging business has severalhundred contracts.  These contracts can change or be amendedfrequently due to changes in the payors’ or governmentalagencies’ reimbursement.  Additionally, as we acquiremedical imaging centers, new contracts have to be entered into ourcomputer systems.  If the contracts have not been updated inour systems, we need to make estimates about the anticipatedcontracted amounts that we will ultimately receive from all of ourvarious payors.  This requires us to record estimates whenrecording imaging revenues based upon historical data andtrends.   These estimates have to be continuallyevaluated and compared to actual reimbursements from the variouspayors to ensure that we have properly recorded revenues andappropriately adjusted for shifts in our payor mix. Accordingly, these recorded revenues are based on currentinformation available, but subject to estimation, which may lead toadjustments in future periods as actual reimbursement rates aredetermined.  Such adjustments have not been material in thefirst quarter of  2002 and 2001.

**Estimating Valuation Allowances for DoubtfulAccounts***.*The preparation of financial statements requiresour management to make estimates and assumptions on thecollectibility of our accounts receivable. Management specificallyanalyzes historical bad debts, customer concentrations, customercredit-worthiness, current economic trends, aging of accounts andchanges in payment terms when evaluating the adequacy of theallowance for doubtful accounts. Any changes in these estimates orassumptions could cause material differences in recordedallowances.

**Valuation of Long-LivedAssets and Goodwill*.***  We assess the impairment of identifiableintangibles, long-lived assets and related goodwill and enterpriselevel goodwill whenever events or changes in circumstances indicatethat the carrying value may not be recoverable. Factors we considerimportant which could trigger an impairment review include thefollowing:
|           | •     | Adversechanges in legal factors, business climate, or regulatoryenvironment,                                                               |
|--------------------------------------------------------|--------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------|
|                                                   | •     | Unanticipated competition,                                                                                                                 |
|                                                   | •     | Loss of keypersonnel,                                                                                                                      |
|                                                   | •     | Amore-likely-than-not expectation that a reporting unit or asignificant portion of a reporting until will be sold or otherwisedisposed of, |
|                                                        | •     | Asignificant asset group within a reporting until is tested forrecoverability under FAS 121, and                                           |
|                                                        | •     | A subsidiarythat is a component of the reporting unit recognizes a goodwillimpairment loss in its separate financial statements.           |

6

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3.         **NEW ACCOUNTINGSTANDARDS.** In July 2001, the Financial Accounting Standards Board (FASB)issued Statement of Accounting Standards (SFAS) No. 141, "BusinessCombinations" and No. 142 "Goodwill and Other IntangibleAssets."  SFAS requires that the purchase method of accountingbe used for all business combinations completed after June 30,2001, clarifies the recognition of intangible assets separatelyfrom goodwill and requires that unallocated negative goodwill bewritten off immediately as an extraordinary gain. SFAS No. 142,which was effective for fiscal years beginning after December 15,2001, requires that ratable amortization of goodwill be replacedwith periodic tests of goodwill impairment and that intangibleassets, other than goodwill, which have determinable useful lives,be amortized over their useful lives. The Company has adopted theseaccounting standards effective January 1, 2002 and is stillanalyzing any possible impairment of goodwill. There were noadjustments to identifiable intangible assets’ useful livesor recorded balances as a result of the adoption of SFASNo.142.  The following is a reconciliation of net income andearnings per share between the amounts reported in the firstquarter of 2001 and the adjusted amounts reflecting these newaccounting rules:
|                                                                   |                                                        | **ThreeMonths Ended, **  |
|-------------------------------------------------------------------|--------------------------------------------------------|-------------------------------|
| *(Dollars in thousands,except per share data)*                    |                                                        | **March31, 2001**             |   |
|                                                         |                                                        |                               |   |
| Net income                                                        |           |                               |   |
|      Reported netincome                  |                                                        | $10,207                       |   |
|      Goodwillamortization (net of taxes) |                                                        | 918                           |   |
|      Adjusted netincome                  |                                                        | $11,125                       |   |
|                                                         |                                                        |                               |   |
| Earnings per share: Basic                                    |                                                        |                               |   |
|      Reported                            |                                                        | $    0.42 |   |
|      Goodwill                            |                                                        | 0.03                          |   |
|      Adjusted earningsper share          |                                                        | $    0.45 |   |
|                                                         |                                                        |                               |   |
| Earnings per share: Diluted                                  |                                                        |                               |   |
|      Reported                            |                                                        | $    0.38 |   |
|      Goodwill                            |                                                        | 0.03                          |   |
|      Adjusted earningsper share          |                                                        | $    0.41 |   |

In August2001, the Financial Accounting Standards Board issued FASBStatement No. 144, *Accounting for the Impairment or Disposal ofLong-Lived Assets* (Statement 144), which supersedes both FASBStatement No. 121, *Accounting for the Impairment of Long-LivedAssets and for Long-Lived Assets to Be Disposed Of* (Statement121) and the accounting and reporting provisions of APB Opinion No.30, *Reporting the Results of Operations—Reporting theEffects of Disposal of a Segment of a Business, and Extraordinary,Unusual and Infrequently Occurring Events and Transactions*(Opinion 30), for the disposal of a segment of a business (aspreviously defined in that Opinion).  Statement 144 retainsthe fundamental provisions in Statement 121 for recognizing andmeasuring impairment losses on long-lived assets held for use andlong-lived assets to be disposed of by sale, while also resolvingsignificant implementation issues associated with Statement121.  Statement 144 retains the basic provisions of Opinion 30on how to present discontinued operations in the income statementbut broadens that presentation to include a component of an entity(rather than a segment of a business).  Unlike Statement 121,an impairment assessment under Statement 144 will never result in awrite-down of goodwill.  Rather, goodwill is evaluated forimpairment under Statement No. 142, *Goodwill and OtherIntangible Assets.*

The Companyis required to adopt Statement 144 no later than the year beginningafter December 15, 2001.  Accordingly, the Company willadopted Statement 144 in the first quarter of 2002. Management does not expect the adoption of Statement 144 forlong-lived assets held for use to have a material impact on theCompany’s financial statements because the impairmentassessment under Statement 144 is largely unchanged from Statement121.  The provisions of Statement 144 for assets held for saleor other disposal generally are required to be appliedprospectively after the adoption date to newly initiated disposalactivities. Therefore, we cannot determine what the potentialeffects of adoption of the Statement will have on our financialstatements.

7

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4.            **COMPREHENSIVEINCOME. **Other comprehensive income includes foreigncurrency translation adjustments and net unrealized gains andlosses on investments in equity securities. Such amounts are asfollows:
|                                          |                                                                    | **March 31, 2002** | **March 31, 2001** |        |
|------------------------------------------|--------------------------------------------------------------------|--------------------|--------------------|-------------|
|                                          |             | Before-Tax Amount  |     | Tax Expense |     | Net-of-Tax Amount |     | Before-Tax Amount |     | Tax Expense |     | Net-of-Tax Amount |   |
|                                          |                                                                    |                    |               |
| Foreign currency translation adjustments |                                                                    | $69                |                    | -           |  | $69 |  | $(139 | ) | - |  | $(139) |
|                                          |                                                                    |                    |                    |             |  |  |  |  |  |  |  |  |   |
| Unrealized gains (losses)on investments: |                                                                    |                    |                    |             |  |  |  |  |  |  |  |  |   |
| Unrealized holding gains(losses)         |                                                                    |                    |                    |             |  |  |  |  |  |  |  |  |   |
|    arisingduring period   |                                                                    | -                  |                    | -           |  | - |  | 4 |  | (1 | ) | 3 |   |
|                                          |                                                                    |                    |                    |             |  |  |  |  |  |  |  |  |   |
|                                          |                                                                    |                    |               |
| Other comprehensiveincome                |                                                                    | 69                 |                    | -           |  | 69 |  | (135 | ) | (1 | ) | (136) |
|                                          |                                                                    |                    |                    |             |  |  |  |  |  |  |  |  |   |
| Net income                               |                                                                    | 17,739             |                    | (6,830      | ) | 10,909 |  | 17,011 |  | (6,804 | ) | 10,207 |   |
|                                          |                                                                    |                    |               |
|                                          |                                                                    |                    |                    |             |  |  |  |  |  |  |  |  |   |
| Total comprehensiveincome                |                                                                    | $17,808            |                    | $(6,830     | ) | $10,978 |  | $16,876 |  | $(6,805 | ) | $10,071 |   |
|                                          |                                                                    |                    |               |

5.            **SEGMENTINFORMATION.**Syncor has identified three primary operatingsegments: U.S. Pharmacy Services, U.S. Medical Imaging andInternational Operations. Segment selection was based upon internalorganizational structures, the process by which these operationsare managed and evaluated, the availability of separate financialresults, and materiality considerations. Segment detail issummarized as follows:

****

****
|                                                      |                                                                                      | **    THREE MONTHSENDED,** |                                                |
|------------------------------------------------------|--------------------------------------------------------------------------------------|------------------------------------------------|------------------------------------------------|
|                                                      |                                                                                      | **March 31,2002**                              |                                                | **March 31,2001** |  |
|                                                      |                                                                                      |                                                |                                                |  |  |
| U.S. Pharmacy ServicesBusiness                       |                |                                                | **       ** |  |  |
|                                                      |                                                                                      |                                                |                                                |  |  |
|      Revenues     |                                                                                      | $164,121                                       |                                                | $133,309 |  |
|      OperatingIncome        |                                                                                      | $  23,778                            |                                                | $  19,782 |  |
|                                            |                                                                                      |                                                |                                                |  |  |
| U.S. Medical ImagingBusiness                         |                                                                                      |                                                |                                                |  |  |
|                                                      |                                                                                      |                                                |                                                |  |  |
|      Revenues               |                                                                                      | $  39,998                            |                                                | $  38,504 |  |
|      OperatingIncome        |                                                                                      | $    4,101                 |                                                | $    4,526 |  |
|                                            |                                                                                      |                                                |                                                |  |  |
| InternationalOperations                              |                                                                                      |                                                |                                                |  |  |
|                                                      |                                                                                      |                                                |                                                |  |  |
|      Revenues               |                                                                                      | $  11,365                            |                                                | $    9,603 |  |
|      Operating (Loss)Income |                                                                                      | $      (316      | )                                              | $        44 |  |
|                                            |                                                                                      |                                                |                                                |  |  |
| UnallocatedCorporate                                 |                                                                                      |                                                |                                                |  |  |
|                                                      |                                                                                      |                                                |                                                |  |  |
|      OperatingLoss          |                                                                                      | $  (6,255                            | )                                              | $   (3,333 | ) |

6.            **NET INCOME PERSHARE. **Basicearnings per share (EPS) amounts are computed by dividing earningsapplicable to common stockholders by the weighted average number ofshares outstanding. Diluted EPS amounts assume the issuance ofcommon stock for all potentially dilutive equivalentsoutstanding.  Anti-dilutive outstanding stock options of3,273,636 and 2,598,747 for the three months ended March 31, 2002and 2001, respectively have been excluded from the dilutedcalculation, respectively.

****

8

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The reconciliation of thenumerator and denominators of the basic and diluted earnings pershare computations are as follows for the three months ended March31, 2002 and 2001:
|                                                                |                                                                                                  | **                                             THREEMONTHS ENDED,** |
|----------------------------------------------------------------|--------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                |                                                                                                  | **                     March31, 2002**                                                                                                                                                      |  | **                    March31, 2001** |
|                                                      |                  | Income (Numerator)                                                                                                                                                                                                                                                                                   |        | Shares (Denominator) |        | PerShare Amount |        | Income (Numerator) |        | Shares (Denominator) |        | PerShare Amount |
|                                                                |                                                                                                  |                                                                                                                                                                                                                                                                                                      |
|                                                                |                                                                                                  |                                                                                                                                                                                                                                                                                                      |  |  |  |  |  |  |  |  |  |  |
| Net income                                                     |                                                                                                  | $10,909                                                                                                                                                                                                                                                                                              |  |  |  |  |  | $10,207 |  |  |  |  |
|                                                                |                                                                                                  |                                                                                                                                                                                                                                                                                                      |  |  |  |  |  |  |  |  |  |  |
| Basic EPS                                                      |                                                                                                  | $10,909                                                                                                                                                                                                                                                                                              |  | 24,766 |  | $0.44 |  | $10,207 |  | 24,473 |  | $0.42 |
|                                                                |                                                                                                  |                                                                                                                                                                                                                                                                                                      |  |  |  |  |  |  |  |  |  |  |
| Effect of Dilutive      Stock Options |                                                                                                  |                                                                                                                                                                                                                                                                                                      |  | 1,966 |  |  |  |  |  | 2,628 |  |  |
|                                                                |                                                                                                  |                                                                                                                                                                                                                                                                                                      |  |  |  |  |  |  |  |  |  |  |
| Diluted EPS                                                    |                                                                                                  | $10,909                                                                                                                                                                                                                                                                                              |  | 26,732 |  | $0.41 |  | $10,207 |  | 27,101 |  | $0.38 |

7.            **NOTES RECEIVABLE-RELATED PARTIES.**  We initiated aSenior Management Stock Purchase Plan effective June 16, 1998,pursuant to which our officers and key employees purchased sharesof Syncor stock.  The shares were paid with a five-yearinterest bearing promissory note payable to us.  Interest oneach note is payable on each anniversary date, with the entireoutstanding principal and unpaid interest due on the fifthanniversary date.  As of March 31, 2002 we had nine employeeswith loans outstanding of $3.5 million, as compared to twenty-oneemployees with $11.3 million outstanding at March 31,2001.

****

8.            **ACQUISITION OF BUSINESSES.**  During the first quarter of2002, we acquired a radiopharmacy in Alaska for a purchase price of$2.0 million.

During the first quarterof 2001, we acquired three imaging center sites in California for apurchase price of $13.4 million.  In addition, in March 2001,we acquired a Gamma knife venture in Brazil for a purchase price of$2.0 million and a distributor of radiopharmaceuticals in NewZealand for a purchase price of $0.3 million plus the assumption of$0.2 million of debt.

9

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**Item 2.**

****

**SYNCOR INTERNATIONAL CORPORATION ANDSUBSIDIARIESManagement's Discussion and Analysis of Financial Condition andResults of OperationsFor the Three Months Ended March 31, 2002 and 2001**

#### **CRITICAL ACCOUNTINGPOLICIES**

Our critical accountingpolicies are as follows:

****

***Revenue Recognition.***We recognize our revenueprimarily from two sources: (i) product revenue, which includessales from our radiopharmacies and (ii) services revenue, primarilyfrom our imaging business. As described below, significantjudgments and estimates must be used by management in connectionwith the revenue recognized in any period for the imaging business.Material differences may impact the amount of revenue recorded inany period if management judgments or estimates are significantlydifferent than actual.

We provide imagingservices to patients that generally have medical insurance througha governmental payor, managed care payor, or a commercialthird-party payor.  Our Medical Imaging business has severalhundred contracts.  These contracts can change or be amendedfrequently due to changes in the payors’ or governmentalagencies’ reimbursement.  Additionally, as we acquiremedical imaging centers, new contracts have to be entered into ourcomputer systems.  If the contracts have not been updated inour systems, we need to make estimates about the anticipatedcontracted amounts that we will ultimately receive from all of ourvarious payors.  This requires us  to record estimateswhen recording imaging revenues based upon historical data andtrends.  These estimates have to be continually evaluated andcompared to actual reimbursements from the various payors to ensurethat we have properly recorded revenues and appropriately adjustedfor shifts in our payor mix.  Accordingly, these recordedrevenues are based on current information available, but subject toestimation, which may lead to adjustments in future periods asactual reimbursement rates are determined.  Such adjustmentshave not been material in the first quarter of 2002 and2001.

***Estimating Valuation Allowances for DoubtfulAccounts****.*The preparation of financial statements requiresour management to make estimates and assumptions on thecollectibility of our accounts receivable. Management specificallyanalyzes historical bad debts, customer concentrations, customercredit-worthiness, current economic trends, aging of accounts andchanges in payment terms when evaluating the adequacy of theallowance for doubtful accounts. Any changes in these estimates orassumptions could cause material differences in recordedallowances.

***Valuation ofLong-Lived Assets and Goodwill.***  We assess the impairment of identifiableintangibles, long-lived assets and related goodwill and enterpriselevel goodwill whenever events or changes in circumstances indicatethat the carrying value may not be recoverable. Factors we considerimportant which could trigger an impairment review include thefollowing:
|           | •     | Adversechanges in legal factors, business climate, or regulatoryenvironment,                                                               |
|--------------------------------------------------------|--------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------|
|                                                   | •     | Unanticipated competition,                                                                                                                 |
|                                                   | •     | Loss of keypersonnel,                                                                                                                      |
|                                                   | •     | Amore-likely-than-not expectation that a reporting unit or asignificant portion of a reporting until will be sold or otherwisedisposed of, |
|                                                        | •     | Asignificant asset group within a reporting until is tested forrecoverability under FAS 121, and                                           |
|                                                        | •     | A subsidiarythat is a component of the reporting unit recognizes a goodwillimpairment loss in its separate financial statements.           |

**NETSALES**

Net sales increased 18.8%,or $34.1 million, to $215.5 million. All three of our businesssegments had sales growth during the quarter.  U.S. PharmacyServices revenue increase was primarily same store radiopharmacygrowth.  The sales growth for Internationl operations wasprimarily from acquisitions and growth in our Taiwanbusinesses.  Medical Imaging services growth was primarilyfrom new imaging centers opened since the first quarter of 2001 andacquisitions.

10

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|                                |                                                  | **        Revenues** |                                                                                                     |
|--------------------------------|--------------------------------------------------|--------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|
|                                |                                                  | **Three Months Ended March 31, **                       |
|                                |          | **2002**                                                     | **                2001** |   |
| ****                           |                                             |
| U.S.Pharmacy Services Business |                                                  | $164,121                                                     | $133,309                                                                                                 |   |
| U.S. MedicalImaging Business   |                                                  | 39,998                                                       | 38,504                                                                                                   |   |
| International Operations       |                                                  | 11,365                                                       | 9,603                                                                                                    |   |
| ****                           |                                             |
| Total                          |                                                  | $215,484                                                     | $181,416                                                                                                 |   |
| ****                           |                                             |

***U.S.Radiopharmacy Business***

**

Net salesincreased 23.1%, or $30.8 million, to $164.1 million drivenprimarily by increased sales of cardiology imaging agents. During the first quarter of 2002, sales related to cardiologyimaging agents increased 12.3%, or $11.7 million, as a result ofprice and volume increases.  This business also had increasesof 26.0%, or $3.9 million, in oncology sales during thequarter.  Overall, pharmacy sales increased 16.3%, or $21.7million, compared to the prior year quarter.  Acquisitionsmade during 2001 accounted for the remainder of the increase forthis business during the first quarter of 2002.

***U.S.Medical Imaging Business***

Net salesincreased 3.9%, or $1.5 million, to $40.0 million.  Sales atexisting centers, which means centers open all months in 2001compared to 2002, decreased by 2.0%, or $0.6 million, compared tothe prior year.  During late 2001 and the first quarter of2002, the Medical Imaging business decided to terminate or notrenew several contracts with payors that had low reimbursementrates or with payors that were very slow paying.  Thisdecision negatively impacted same store sales for the first quarter2002, especially in the Arizona and South Florida markets. The remaining increase in sales was the result of acquisitions andstart-up centers.  The volume of imaging procedures performedat our existing centers decreased 2% for MRI and increased 2% forCT compared to the same period in 2001.

***International Operations***

Net salesincreased 18.3%, or $1.8 million, to $11.4 million due primarily tostart-up businesses and acquisitions.  Acquisitions accountedfor the majority of the sales increase.  Net sales at ourexisting centers or facilities were lower during the quarterprimarily as a result of adverse economic conditions in Argentina,lower sales in the Shanghai seeds facility and slowing sales in ourPuerto Rico pharmacy.  The Taiwan market did have higher samestore sales, which increased 6%.

****

**GROSSPROFIT**

Gross profitincreased 20.0%, or $13.8 million, to $82.5 million.  Ourconsolidated gross profit margin as a percentage of sales improvedto 38.3% in 2002 as compared to 37.9% in 2001 driven by continuedimprovement in product mix, price increases, and operatingefficiencies in our radiopharmacy network and increased marginsfrom new business in the Pharmacy ServicesBusiness. 
|                                |                                                  | **      GrossProfit** |                                                                                               |
|--------------------------------|--------------------------------------------------|-----------------------------------------------------|----------------------------------------------------------------------------------------------------|
|                                |                                                  | **Three Months Ended March 31, **              |
|                                |          | **2002**                                            | **               2001** |   |
| ****                           |                                             |
| U.S.Pharmacy Services Business |                                                  | $51,321                                             | $39,154                                                                                            |   |
| U.S. MedicalImaging Business   |                                                  | 26,958                                              | 25,753                                                                                             |   |
| International Operations       |                                                  | 4,176                                               | 3,782                                                                                              |   |
| ****                           |                                             |
| Total                          |                                                  | $82,455                                             | $68,689                                                                                            |   |
| ****                           |                                             |

11

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***U.S.Radiopharmacy Business***

**

Gross profitincreased 31.1%, or $12.2 million, to $51.3 million. Gross profitmargin as a percentage of sales improved to 31.3% in 2002 ascompared to 29.4% in 2001. This gross profit margin increase wasdue primarily to improved margins associated with new businesses,such as FDG, and higher margins associated with recentacquisitions.  These initiatives accounted for 1.7% of theoverall margin increase.  The remainder of the gross profitmargin increase was the result of continued leveraging of ourradiopharmacy network; we continue to successfully increase volumeswithout comparable increases in material, labor and deliverycosts.

***U.S.Medical Imaging Business***

**

Gross profitincreased 4.7%, or $1.2 million, to $27.0 million. Our gross profitmargin as a percentage of sales increased in 2002 to 67.4% comparedto 66.9% in 2001.  Our gross profit increased due to betterlabor utilization in the quarter.

***International Operations***

**

Gross profitincreased 10.4%, or $0.4 million, to $4.2 million.  Our grossprofit margin as a percentage of sales decreased in 2002 to 36.7%compared to 39.4% in 2001. Margin growth at our existingradiopharmacy sites and imaging centers was flat in 2002 comparedto the prior year. Our margins were reduced by acquired businesses,which have a lower margin than our existing businesses, and theadverse conditions in the Argentina market. 

**OPERATING, SELLING ANDADMINISTRATIVE EXPENSES**

Operating,selling and administrative expenses increased 30.8%, or $12.0million, to $51.0 million.  The ratio of these expenses to netsales for the quarter was 23.7% compared to 21.5% for the sameperiod in 2001. Operating, selling and administrative costs at ourmedical imaging business are higher than such costs at ourradiopharmacy business.  Acquisitions in the RadiopharmacyBusiness caused the majority of the increase in addition to higherCorporate costs primarily from increased IT costs associated withnew systems and increased telecommunications expenses.
|                                |                                                  | **Operating, Selling andAdministrative Expenses** |     |
|--------------------------------|--------------------------------------------------|---------------------------------------------------|----------|
|                                |                                                  | **Three Months Ended March 31, **            |
|                                |          | **2002**                                          | **2001** |   |
| ****                           |                                             |
| U.S.Pharmacy Services Business |                                                  | $25,275                                           | $17,836  |   |
| U.S. MedicalImaging Business   |                                                  | 17,739                                            | 16,357   |   |
| International Operations       |                                                  | 3,481                                             | 2,789    |   |
| UnallocatedCorporate           |                                                  | 4,512                                             | 2,029    |   |
| ****                           |                                             |
| Total                          |                                                  | $51,007                                           | $39,011  |   |
| ****                           |                                             |

***U.S.Radiopharmacy Business***

**

Operating,selling and administrative costs increased 41.7%, or $7.4 million,to $25.3 million.  This increase was due primarily toincreased costs associated with acquired businesses, whichaccounted for $3.4 million of this increase. Costs associated withopening new cyclotrons, used in the production of FDG, accountedfor an additional $1.4 million.  The remainder of the increaseis the result of increased costs in our radiopharmacy network, aswell as higher costs in start-up businesses in this segment. As a percentage of sales, operating, selling and administrativeexpenses increased from 13.4% in 2001 to 15.4% in2002. 

***U.S.Medical Imaging Business***

**

Operating,selling and administrative costs increased 8.4%, or $1.4 million,to $17.7 million.  These expenses increased primarily as aresult of increased payroll and bad debt expenses in thequarter.  As a percentage of sales, these expenses increasedfrom 42.5% in 2001 to 44.3% in 2002.

***International Business***

Operating,selling and administrative expenses increased 24.8%, or $0.7million, to $3.5 million. These expenses increased primarily as aresult of new businesses and start-up centers. As a percentage ofsales, these expenses increased from 29.0% in 2001 to 30.6% in2002. 

12

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**DEPRECIATION ANDAMORTIZATION**

Depreciationand amortization increased 17.1%, or $1.5 million, to $10.1million. This was offset by amortization of goodwill in the firstquarter of 2001 of $1.5 million with none in the first quarter of2002.  Of the increase, $0.2 million was attributable to ourmedical imaging business.  The remainder of the increase wasattributable to our pharmacy services business, primarily in newFDG production facilities, with an increase of $0.7 million; andour corporate operations, primarily for new IT systems costs withan increase of $0.4 million.
|                                |                                                  | **Depreciation and Amortization**      |                                                                                                     |
|--------------------------------|--------------------------------------------------|----------------------------------------|----------------------------------------------------------------------------------------------------------|
|                                |                                                  | **Three Months Ended March 31, ** |
|                                |          | **2002**                               | **                2001** |   |
| ****                           |                                             |
| U.S.Pharmacy Services Business |                                                  | $2,291                                 | $1,543                                                                                                   |   |
| U.S. MedicalImaging Business   |                                                  | 5,118                                  | 4,870                                                                                                    |   |
| International Operations       |                                                  | 1,011                                  | 949                                                                                                      |   |
| UnallocatedCorporate           |                                                  | 1,720                                  | 1,297                                                                                                    |   |
| ****                           |                                             |
| Total                          |                                                  | $10,140                                | $8,659                                                                                                   |   |
| ****                           |                                             |

**ACQUISITION OFBUSINESSES**

****

During the first quarterof 2002, we acquired a radiopharmacy in Alaska for a purchase priceof $2.0 million.

During the first quarterof 2001, we acquired three imaging center sites in California for apurchase price of $13.4 million.  In addition, in March 2001,we acquired a Gamma knife venture in Brazil for a purchase price of$2.0 million and a distributor of radiopharmaceuticals in NewZealand for a purchase price of $0.3 million plus the assumption of$0.2 million of debt.

**LIQUIDITY AND CAPITALRESOURCES**

****

We had cash, cashequivalents and investments of $24.1 million at March 31, 2002compared to $29.5 million at December 31, 2001. Total debt was$216.3 million at March 31, 2002 compared to $226.7 million atDecember 31, 2001, a reduction of $10.4 million. We had a positivecash flow from operations of $21.9 million during the first quarterof 2002.  We used a portion of this cash to pay down debtbalances. Working capital decreased slightly to $113.7 million from$115.7 million at December 31, 2001.

On January 17, 2002, wecompleted an asset securitization agreement using the tradereceivables as collateral. At March 31, 2002, we had $61.2 millionextended on this $65 million agreement. In addition, we hadborrowings of $102.0 million outstanding on our $167.5 millioncredit line. Based upon our current acquisition and capital planswe believe we have sufficient resources available to fund our 2002capital needs.

#### **FORWARD LOOKINGSTATEMENT**

Except for the historicalinformation and discussions contained herein, statements containedin this Report on Form 10-Q may constitute "forward lookingstatements" within the meaning of the Private Securities LitigationReform Act of 1995.  These statements involve a number ofrisks, uncertainties and other factors that could cause actualresults to differ materially, including: changes in the regulationof the healthcare industry at either or both of the federal andstate levels; changes or delays in reimbursement for our servicesby governmental or private payers; our failure to continue todevelop and market new products and services and to keep pace withtechnological change; competitive pressures; failure to obtain orprotect intellectual property rights; quarterly fluctuations inrevenues and volatility of our stock price; our ability to attractand retain key personnel; currency risks; dependence on certainsuppliers; our ability to successfully manage acquisitions andalliances; legal, political and economic changes; and other risks,uncertainties and factors discussed  in the "Risk Factors"section in the Annual Report on Form 10-K for December 31, 2001 andelsewhere herein, in our other filings with the SEC or in materialsincorporated by reference.  Given these uncertainties, unduereliance should not be placed on such forward-lookingstatements.

**Item 3.**

#### **QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUTMARKET RISKS**

Interest income earned onour investment portfolio is affected by changes in the generallevel of U.S. interest rates. Our line of credit borrowingseffectively bear interest at variable rates and therefore, changesin U.S. interest rates affect interest expense incurred thereon.Changes in interest rates do not affect interest expense incurredon our fixed rate debt. There have been no significant changes inthe debt instruments from the table as filed in the annual reporton Form 10K at December 31, 2001.

13

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****

**SYNCOR INTERNATIONAL CORPORATION ANDSUBSIDIARIES**

****

****

#### **Part II.  OTHERINFORMATION**

****

**Item 6.  Exhibits and Reports on Form8-K**

           (a)       Exhibits

                       10.       MaterialContracts

                                   10.1     Severance and Release Agreement, datedJanuary 31, 2002, between Haig Bagerdjian and theCompany.

                                   10.2     Severance and Release Agreement, datedApril 5, 2002, between David Ward and the Company.

           (b)       Reports on Form8-K

                       None.

14

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****

****

**SIGNATURE**

Pursuant to therequirements of the Securities Exchange Act of 1934, the Registranthas duly caused this report to be signed on its behalf by theundersigned thereunto duly authorized.
|                                                                                                                                                                                                                                                                                                                                                                                                             | **Syncor InternationalCorporation**                                                                                                                                                                                                                                                                   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                             |                        (Registrant)                                                                                                                                                |
|                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                             |
| May 15,2002                                                                 | By:  /s/ WilliamP.Forster                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                             |        WilliamP. Forster                                                                                                                                                                                                                                           |
|                                                                                                                                                                                                                                                                                                                                                                                                             |        SeniorVice President and Chief Financial Officer                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                             |        (PrincipalFinancial/Accounting Officer)                                                                                                                                                                                                                     |

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