Matria Healthcare Announces Third Quarter Results
MARIETTA, Ga., Oct. 26 /PRNewswire/ -- Matria Healthcare, Inc.
(Nasdaq: MATR) announced today its financial results for the third quarter and
nine months ended September 30, 1998.
Revenues for the third quarter of 1998 were $34.1 million, compared to
$36.5 million reported in the third quarter of 1997. Excluding amortization
and write-down of goodwill and other intangibles, net income for the quarter
was $2.2 million, or $0.06 per share, compared to net income of $4.3 million,
or $0.12 per share, for the third quarter of 1997. Including goodwill and
other intangible amortization and write-down charges of $86.4 million ($2.37
per share), the Company reported a net loss of $84.2 million, or $2.31 per
share, for the third quarter of 1998, compared to a net loss of $4.9 million,
or $0.13 per share, for the same period of 1997.
During the third quarter, the Company incurred a charge of $85.4 million
for the write-down of goodwill and other intangible assets that resulted from
the 1996 merger of Tokos Medical Corporation and Healthdyne Maternity
Management. As previously announced, the Company determined that these
intangible assets have diminished future value as a result of Matria's
expansion beyond maternity management. A significant amount of the Company's
future growth will be derived from expansion into diversified disease
management markets and the reporting of Matria's future financial results will
more appropriately portray the performance of such a diversified company.
For the nine months ended September 30, 1998, the Company reported
revenues of $100.4 million compared to $107.4 million reported for the
comparable 1997 period. Net income for the nine-month period excluding
amortization and write-down of goodwill and other intangible charges of
$104.7 million ($2.86 per share) was $9.6 million, or $0.26 per share,
compared to $10.7 million, or $0.29 per share, for the same period of 1997.
With the inclusion of these charges, the Company reported a net loss for the
nine-month period of $95.1 million, or $2.60 per share, compared to a net loss
of $16.8 million, or $0.46 per share, in the year-ago period.
Donald R. Millard, President and Chief Executive Officer, commented, "As
previously announced, our financial results for the third quarter were
impacted by decreased physician prescriptions for the Company's preterm labor
management services as well as increased expenses associated with the
Company's diversification strategy. We have recently accelerated our efforts
to expand our disease management competency into cardiology, respiratory
disorders, and the general diabetes markets; which establishes us in segments
approximating 60% of the estimated $6 billion disease management market. We
are encouraged by the initial success of these new programs and believe these
initiatives will contribute significantly to our future growth."
Frank D. Powers, Executive Vice President and Chief Operating Officer
commented on Matria's growth initiatives, "We are beginning to see the impact
of our recent expansions into the diabetes and cardiology markets. Revenues
from our diabetes business have increased more than five times over 1997 third
quarter revenues, producing an annualized run rate in excess of $8 million.
Quality Diagnostic Services, Inc., our recent acquisition and entry into the
cardiology disease management market, has set patient census, revenue and
profit records each month since the acquisition and is projected to produce
revenues in excess of $7 million for the second half of 1998."
Mr. Millard concluded, "The Company continues to be financially sound. At
the end of the quarter, we had $9 million in cash and we continue to generate
positive cash flow from operations. Additionally, through our accounts
receivable focus, our DSOs have declined by 6 days as of the end of the
quarter. Going forward, we will capitalize on our financial strength and
expect to see improvement in both revenues and earnings."
This press release contains forward-looking statements that involve risks
and uncertainties, including developments in the healthcare industry,
third-party actions over which the Company does not have control, and
regulatory requirements applicable to the Company's business, as well as other
risks detailed from time to time in the Company's reports filed with the
Securities and Exchange Commission.
Matria Healthcare, Inc. is the leading provider of comprehensive disease
management services for health plans and employers for women's health and the
chronic conditions of diabetes, respiratory disorders, and cardiovascular
disease.
MATRIA HEALTHCARE, INC.
Consolidated Condensed Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended, Nine Months Ended,
September 30, September 30,
1998 1997 1998 1997
Revenues $ 34,107 36,540 100,399 107,432
Cost of revenues 13,790 14,203 39,914 43,329
Selling and
administrative
expenses 16,173 16,746 45,994 48,946
Provision for
doubtful accounts 1,763 1,656 4,967 4,823
Amortization and write
down of goodwill,
other intangibles
and in process
research and
development 86,382 9,147 104,676 27,456
118,108 41,752 195,551 124,554
Operating loss (84,001) (5,212) (95,152) (17,122)
Interest income
(expense), net (285) 159 (291) 417
Other income
(expense), net 130 155 344 (57)
Net loss $(84,156) (4,898) (95,099) (16,762)
Basic and diluted
net loss per
common share $ (2.31) (.13) (2.60) (.46)
Weighted average
number of common
shares outstanding 36,461 36,552 36,646 36,475
MATRIA HEALTHCARE, INC.
Consolidated Condensed Balance Sheets
(Amounts in thousands)
(Unaudited)
ASSETS September 30, December 31,
1998 1997
Current assets:
Cash and short-term
investments $ 9,015 20,942
Trade accounts
receivable, net 40,272 39,601
Inventories 1,450 1,088
Other current assets 3,809 2,264
Total current assets 54,546 63,895
Property and equipment, net 14,697 12,364
Goodwill and other
intangibles, net 24,041 112,149
Cash surrender value of
life insurance 4,425 1,800
Other assets 3,462 924
101,171 191,132
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments
of long-term debt and
obligations under capital
leases 1,118 884
Accounts payable, principally
trade 5,810 5,712
Deferred revenue 3,405 3,561
Other current liabilities 5,762 12,586
Total current liabilities 16,095 22,743
Long-term debt and obligations
under capital leases, excluding
current installments 18,336 1,712
Accrued benefit costs 4,525 5,328
Other long-term liabilities 6,004 8,180
Total liabilities 44,960 37,963
Shareholders' equity 56,211 153,169
101,171 191,132
SOURCE Matria Healthcare, Inc.
CO: Matria Healthcare, Inc.
ST: Georgia
IN: HEA
SU: ERN
10/26/98 07:32 EST prnewswire.com |
