HealthAxis Inc. Reports Third Quarter 2000 Results
EAST NORRITON, Pa.--(BUSINESS WIRE)--Nov. 14, 2000--HealthAxis Inc. (NASDAQ:HAXS - news) today reported a net loss from continuing operations, excluding interest expense, amortization costs, stock based compensation expense, and the minority interest, for the third quarter ended September 30, 2000, of $2,001,000, or ($.15) per share on a fully diluted basis, on $11,016,000 of revenue.
This compares to a net loss of $1,845,000, or ($.15) per share on a fully diluted basis, for the comparable period in the previous year, on no revenue. Including interest expense, amortization costs, stock based compensation expense, and the minority interest, the net loss for the third quarter was $6,929,000, or ($.53) per share on a fully diluted basis.
For the corresponding 1999 quarter, the Company reported a net loss from continuing operations of $2,121,000, or ($.17) per share on a fully diluted basis.
For the nine months ended September 30, 2000, the net loss from continuing operations, excluding interest expense, amortization costs, stock based compensation expense, and the minority interest, was $10,447,000, or ($.80) per share on a fully diluted basis, on $32,754,000 of revenue.
This compares to a net loss of $5,544,000, or ($.46) per share on a fully diluted basis, for the comparable period in the previous year, on no revenue. Including interest expense, amortization costs, stock based compensation expense, and the minority interest, the Company's operating loss from continuing operations for the nine months was $21,806,000, or ($1.67) per share on a fully diluted basis.
For the corresponding 1999 period, the Company reported a net loss from continuing operations of $5,926,000, or ($.50) per share on a fully diluted basis.
In connection with HealthAxis.com's previously announced transaction with Digital Insurance, which was completed on October 13, 2000, wherein HealthAxis.com sold certain assets used in connection with its retail website to Digital Insurance, the Company is treating HealthAxis.com's eDistribution Group as a discontinued operation.
In that regard, discontinued operations had a net loss for the quarter and nine months of $0 and $6,341,000 respectively.
For the corresponding 1999 periods, the Company reported losses from discontinued operations of $20,975,000 and $30,540,000 respectively.
The per share loss from, plus loss on sale of, the discontinued operations was ($.00), and ($.78) on a fully diluted basis for the quarter and the nine month periods, respectively, versus ($1.68) and ($2.54) on a fully diluted basis for the corresponding 1999 periods.
Combining the results from continuing operations and discontinued operations, the Company reported a net loss for the quarter and nine months ended September 30, 2000 of $6,929,000 ($.53) per share on a fully diluted basis and $31,990,000 ($2.45) per share on a fully diluted basis, respectively.
For the corresponding 1999 periods, the Company's total loss was $23,096,000 ($1.85) per share on a fully diluted basis and $36,466,000 ($3.04) per share on a fully diluted basis, respectively.
The Company anticipates that its near-term cash burn rate will average approximately $1.4 million per month for the fourth quarter, reaching positive cash flow during the second quarter of 2001, and that it will end the year 2000 with in excess of $21 million in cash on hand.
Michael Ashker, President and CEO of HealthAxis Inc. stated: ``All of the necessary initiatives are underway at our company to allow us to achieve two important objectives on the financial front: one is the simplification of our reporting structure, which will occur following the reorganization of HealthAxis Inc., and the other is our goal to turn HealthAxis Inc. cash flow positive during Q2 of 2001.''
In other matters of interest:
The Company has tentatively set January 22, 2001 as the date for its shareholder meeting, at which time the shareholders will be requested to vote on the proposed merger between HealthAxis Inc. and HealthAxis.com, Inc. This meeting date is subject to effectiveness of the Company's previously filed Registration Statement on Form S-4.
As part of the review process of the Registration Statement on Form S-4, the Company has decided to re-file its Form 10-Q for the quarter ended June 30, 2000 to reflect a write off of only a portion of the goodwill originally written off at June 30, 2000 as a result of the sale of certain assets to Digital Insurance. Due to this modification in treatment, the previously reported loss on the sale of the eDistribution Group (formerly Consumer Services Group) will be reduced from $225,792,000 to $3,843,000. The remaining goodwill will be amortized over 20 years.
The Company was notified by NASDAQ that it does not meet the NASDAQ national market maintenance criteria for continued national market listing, due to the decline in its stock price and that its Common Stock would be delisted on November 9, 2000. The Company has filed a request for appeal of the delisting which stayed the delisting of the Common Stock pending the appeal panel's decision. At the NASDAQ hearing, scheduled for December 8, 2000, the Company currently intends to appeal the delisting decision in light of the pending HealthAxis Inc. and HealthAxis.com merger. The Company believes it will be in compliance with these maintenance requirements upon completion of the merger.
The Company's management will host a conference call to review results and answer questions. The conference call will be held today (Nov 14) at 4:30 P.M. EST. Investors wishing to participate should call 800/815-2528, or 706/679-3660 for International callers, and request the HealthAxis IR Call. A replay will be available for 10 days at: 800/642-1687 and 706/645-9291 for International callers.
The access code (for replay only) is 354454.
Additionally, today's call will be broadcast on the Internet, and remain available in archives for 30 days, by WebRadio at: webradio.com.
About HealthAxis
HealthAxis.com, a subsidiary of HealthAxis Inc., is a leader in Web-enabling both healthcare payers and the intermediaries through which product is sold and serviced. The Company's proprietary Insur-Web(TM), Insur-Enroll®, and Insur-Admin(TM) product line allows clients to participate in the emerging digital economy by integrating client legacy systems into the World Wide Web.
HealthAxis customers enjoy reduced costs and enhanced productivity in their core business operations -- including plan rating, distribution, enrollment, and member services -- through the integration of the Company's advanced, XML-enabled product line.
Additionally, HealthAxis provides payers with software and services for claims processing, plan administration, and imaging through the following products: Insur-Claims(TM), Insur-Dental(TM), Insur-Image(TM), and Insur-Voice(TM).
The Company's customers include leading health insurers, Blue Cross/Blue Shield organizations, third-party administrators, and Web-based insurance and benefits marketers. HealthAxis.com is headquartered in suburban Philadelphia, with significant operations in Dallas, as well as offices in eight additional locations both domestic and abroad. The Company employs over 350 IT professionals.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain statements made which are not historical facts may be considered forward-looking statements, including, without limitation, statements as to trends, management's beliefs, expectations and opinions, which are based upon a number of assumptions concerning future conditions that ultimately may prove to be inaccurate.
Such forward-looking statements are subject to risks and uncertainties and may be affected by various factors, which may cause actual results to differ materially from those in the forward-looking statements.
For further information, which could cause actual results to differ from the Company 's expectations, as well as other factors, which could affect HealthAxis Inc.'s financial statements, please refer to HealthAxis Inc.'s reports filed with the Securities and Exchange Commission.
HealthAxis Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
(000's omitted)
Sept. 30, Dec. 31,
2000 1999
-------- --------
Assets
Cash and cash equivalents $ 25,170 $ 58,069
Goodwill 656,602 7,114
Other assets 42,591 14,419
-------- --------
Total assets $724,363 $ 79,602
======== ========
Liabilities and Stockholders' Equity
Current liabilities $ 7,789 $ 6,979
Convertible debentures 26,715 25,019
Other long term liabilities 7,815 7,332
Minority interest in
HealthAxis.com, Inc. 464,260 27,652
Stockholders' equity 217,784 12,620
-------- --------
Total Liabilities and
Stockholders' Equity $724,363 $ 79,602
======== ========
HealthAxis Inc. and Subsidiaries
Consolidated Condensed Statements of Operations
(000's omitted)
Three Months Nine Months
Ended September 30, Ended September 30,
2000 1999 2000 1999
---- ---- ---- ----
Revenue $ 11,016 $ - $ 32,754 $ -
Expenses 24,816 1,953 80,539 5,652
--------------------------------------------
Operating Loss (13,800) (1,953) (47,785) (5,652)
Interest and other
income (expense),
net (916) (168) (1,093) (589)
--------------------------------------------
Loss before minority
interest (14,716) (2,121) (48,878) (6,241)
Minority interest in
net loss of
subsidiary 7,787 0 27,072 315
--------------------------------------------
Loss in continuing
operations (6,929) (2,121) (21,806) (5,926)
--------------------------------------------
Loss from
discontinued
operations 0 (20,975) (6,341) (30,540)
Loss on sale of
discontinued
operations 0 0 (3,843) 0
--------------------------------------------
Net loss (6,929) (23,096) (31,990) (36,466)
--------------------------------------------
Dividends on
preferred stock 0 0 0 70
--------------------------------------------
Net loss applicable
to common stock ($ 6,929) ($23,096) ($31,990) ($36,536)
============================================
Loss per share of
common (basic and
diluted)
Continuing
operations ($ 0.53) ($ 0.17) ($ 1.67) ($ 0.50)
Discontinued
operations $ 0.00 ($ 1.68) ($ 0.78) ($ 2.54)
--------------------------------------------
Net Loss ($ 0.53) ($ 1.85) ($ 2.45) ($ 3.04)
====================================s========
Weighted average
common shares
outstanding 13,098 12,462 13,079 12,021
--------------------------------------------------------------------------------
Contact:
HealthAxis Inc.
Investor and Media Contact:
Steven M. Kaplan, 610/275-3800
skaplan@healthaxis.com
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