Matria Healthcare, Inc. Announces Second Quarter Results and Entry Into AsthmaAnd COPD Disease Management Market
MARIETTA, Ga., July 23 /PRNewswire/ -- Matria Healthcare, Inc.
(Nasdaq: MATR) announced today its financial results for the second quarter
and six months ended June 30, 1998.
Revenues for the second quarter of 1998 were $33.5 million, compared to
$36.4 million reported in the second quarter of 1997. Excluding amortization
of goodwill and other intangibles, net income for the quarter was
$3.9 million, or $0.11 per share, compared to net income of $3.6 million, or
$0.10 per share, for the second quarter of 1997. Including goodwill and other
intangible amortization charges of $9.1 million ($0.25 per share), the Company
reported a net loss of $5.3 million, or $0.14 per share, for the second
quarter of 1998, compared to a net loss of $5.5 million or $0.15 per share,
for the same period of 1997.
For the six-month period ended June 30, 1998, Matria reported revenues of
$66.3 million compared to $70.9 reported in the second quarter of 1997. Net
income for the six-month period excluding amortization of goodwill and other
intangible charges of $18.3 million ($0.50 per share) was $7.4 million, or
$0.20 per share. With the inclusion of these charges, the Company reported a
net loss of $10.9 million, or $0.30 per share, for the six-month period
compared to a net loss of $11.9 million, or $0.33 per share, in the comparable
1997 period.
Frank D. Powers, Executive Vice President and Chief Operating Officer,
stated, "We are encouraged by the quarter's 2% sequential revenue growth we
have achieved despite the impact on our maternity management business caused
by confusion resulting from the FDA letter to physicians reiterating that the
use of terbutaline sulfate for the management of preterm labor is an 'off-
label' use. Additionally, as a result of our focus on higher acuity patients
and control of variable costs, our quarterly profit margin expanded both on a
sequential and year-over-year basis. During the second quarter, our profit
margin, before adjustments, expanded to 11.5% compared to 11% in the first
quarter of 1998 and 10% for the second quarter of last year. Furthermore, our
Diabetes in Pregnancy Program is ahead of plan, with a current annualized run
rate in excess of $8 million."
Separately, the Company announced it had entered into an agreement with
National Jewish Medical and Research Center, Denver, Colorado, to provide
services for the National Jewish asthma and COPD (Chronic Obstructive
Pulmonary Disease) disease management program. National Jewish, established
in 1899, is the leading provider of respiratory disease management services
and the leader in respiratory and immunology research. Beginning July 27,
1998, Matria will provide patient enrollment, risk assessment, and after-hours
on-call services for managed care contracts with over 1.5 million covered
lives.
Donald R. Millard, President and Chief Executive Officer, commented, "This
agreement validates our commitment to expand our disease management competency
as well as our revenue base beyond pregnancy. The asthma and COPD market
represents approximately 15% of the estimated $6 billion disease management
market. Initially, we anticipate providing services to approximately 11,000
moderate and severe asthmatic patients which will generate revenues of
approximately $1 million over the next 12 months. With this agreement and our
recent acquisition of Quality Diagnostic Services, Inc., Matria has now become
a disease manager for the chronic conditions of asthma and COPD, and
cardiovascular disease. Our previously announced expansion of our Diabetes in
Pregnancy Program into the general diabetes population adds another chronic
disease to Matria's disease management portfolio. By providing comprehensive
services for these chronic disease states along with our core maternity
management services, Matria now provides care to the segments which represent
approximately 60% of the disease management market. We anticipate the total
disease management market opportunity to reach $6 billion annually."
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 the condition of
pregnancy 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, Six Months Ended,
June 30 June 30
1998 1997 1998 1997
Revenues $33,473 36,362 66,291 70,892
Cost of revenues 12,799 14,649 26,124 29,126
Selling and
administrative expenses 15,112 16,520 29,820 32,200
Provision for doubtful accounts 1,714 1,667 3,204 3,167
Amortization of goodwill
and other intangibles 9,147 9,145 18,294 18,309
38,772 41,981 77,442 82,802
Operating loss (5,299) (5,619) (11,151) (11,910)
Interest income (expense), net (24) 144 (6) 258
Other income (expense), net 28 (41) 214 (212)
Net loss $(5,295) (5,516) (10,943) (11,864)
Basic and diluted net
loss per common share $(.14) (.15) (.30) (.33)
Weighted average number of
common shares outstanding 36,652 36,500 36,739 36,436
Matria Healthcare, Inc.
Consolidated Condensed Balance Sheets
(Amounts in thousands)
(Unaudited)
ASSETS June 30, December 31,
1998 1997
Current assets:
Cash and short-term investments $11,110 20,942
Trade accounts receivable, net 41,471 39,601
Inventories 1,285 1,088
Other current assets 4,687 2,264
Total current assets 58,553 63,895
Property and equipment, net 11,151 12,364
Goodwill and other intangibles, net 93,855 112,149
Cash surrender value of life insurance 3,854 1,800
Other assets 1,453 924
168,866 191,132
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt
and obligations under capital leases 1,103 884
Accounts payable, principally trade 3,791 5,712
Deferred revenue 3,470 3,561
Other current liabilities 6,337 12,586
Total current liabilities 14,701 22,743
Long-term debt and obligations under
capital leases, excluding
current installments 3,544 1,712
Accrued benefit costs 4,345 5,328
Other long-term liabilities 5,555 8,180
Total liabilities 28,145 37,963
Shareholders' equity 140,721 153,169
168,866 191,132
SOURCE Matria Healthcare, Inc.
CO: Matria Healthcare, Inc.; National Jewish Medical and Research Center;
Quality Diagnostic Services, Inc.
ST: Georgia, Colorado
IN: HEA
SU: ERN LIC
07/23/98 13:20 EDT prnewswire.com |
