Looks pretty good to me
Air Methods Reports 2Q98 Results Net Income Increased 49% Prior to Special Costs
DENVER, Aug. 11 /PRNewswire/ -- Air Methods Corporation (Nasdaq: AIRM) reported results for the second quarter and six months ended June 30, 1998.
-- For the Second Quarter: Revenue was $12.0 million and net income was
300,000 or $0.04 per basic and diluted share (after $300,000 or
0.04 per share in previously announced special costs). Prior to these
costs, revenue increased 51% to $12.1 million and net income increased
49% to $600,000.
-- For the Six Months: Revenue was $24.1 million and net income was
1.2 million or $0.15 per basic share and $0.14 per diluted share
(after $300,000 or $0.04 per share in the second quarter special
costs). Prior to these costs, revenue increased 56% to $24.3 million
and net income increased 228% to $1.5 million.
The special costs related to re-manufacturing wire harnesses produced by Air Methods and one of its subcontractors for Sikorsky Aircraft Corporation after Sikorsky accepted, then rejected the subcontractor's work.
Results for the June 1998 quarter reflected a 56% increase in flight operations revenue to $11.1 million compared to $7.1 million in the prior year period due to:
-- The addition of Mercy Air Service, Inc., which added revenues of
3.8 million during the second quarter and $6.9 million during the
six month period. Acquired in July 1997, Mercy experienced increased
patient volumes compared to the first quarter and better than
anticipated collections.
-- Annual price increases and new Flight Service contracts with Evansville
(Indiana) Wellborn Baptist Hospital, which started December 1997, and
Flagstaff (Arizona) Medical Center, which started in March 1998.
The benefit of these increases more than offset the cost of investments to enter new markets, upgrade the Company's fleet, and expand backup capability, and the impact of a lighter revenue quarter for the Products Division. As a result, prior to special costs, second quarter earnings before interest, taxes, depreciation and amortization (EBITDA) grew 42% to $2.2 million, operating margin expanded to 9% of revenue compared to 8% in the prior year quarter, and operating income increased 70% to $1.1 million.
George Belsey, Chairman and CEO, said that Air Methods also made important progress with its growth plan during the second quarter, which should favorably impact second half results.
-- Products Division: Won $3.3 million in three new military and
commercial contracts. Work has already begun and is expected to
continue through the commencement of the next phase of the U.S Army's
helicopter modernization program later this year. The program calls
for retrofitting a total of 447 BlackHawks with Air Methods' Multi- Mission Medevac Interior System. These new contracts are part of Air
Methods' plan to build and diversify the division by exploiting its
growing line of patented multi-mission medical interior products and
its ability to function as a prime contractor to the military.
-- Mercy Air: Expanded into the greater Las Vegas market effective
June 15, 1998 with positive, initial results. Once established, Las
Vegas is initially expected to increase Mercy Air's revenues by
1.5 - $2 million annually. Air Methods plans to expand Mercy Air from
its Southern California base into markets where it can leverage core
competencies -- such as management, communications and dispatch,
billing and collections, and back up equipment -- creating operating
efficiencies and expanded service levels for local communities.
-- Flight Services: Won a new, three-year contract expected to commence
in the fourth quarter, to provide emergency air transportation services
for the "Life Reach" program at Providence Hospital in Columbia, SC.
Providence, which will result in deployment of another new Bell 407
helicopter, is the third new program that Air Methods will begin
servicing in less than a year. The new contract increases Air Methods'
critical mass of aeromedical programs in the Mid-Atlantic region,
strengthening regional backup and mutual aid capabilities. |
