Donna,
I have included a copy of the press release from the HearX web site:
hearx.com
You asked Does anyone have any guesses what the latest news released yesterday may do to the stock price?. Well, none of us are able to predict a future event. While the HearX numbers were overall generally very good, in and of itself, that does not mean we can predict a short term share price rise next week. Combining the good 3rd quarter financials with the stock repurchase program (if they actually do buy stock in the open market), would normally be considered as very bullish for the stock price (short term). However, you must remember that we are talking about a stock that is priced under a dollar, so institutional investments are minimal or non-existent (unless under private placement). Also, EAR is traded on the less volatile AMEX which can sometimes translate to fewer individual investors being aware of the HearX story. Summed up, it is possible that we will see a short term upward movement in the share price, but don't go looking for any pie in the sky. EAR is a very young company with time to grow. If you like their story, consider adding some more shares to your portfolio while they're still a relatively unknown commodity. Remember that EAR is still a very risky investment when compared to other equities.
KJC
HEARx REPORTS THIRD QUARTER RESULTS
WEST PALM BEACH, FL, November 6, 1998 -- HEARx Ltd. (AMEX:EAR), the largest audiology-based professional hearing care network in the United States, today reported that revenues for our third quarter ending September 25, 1998 increased 15.1% to $6,614,203, as compared to $5,744,926 for the comparable quarter last year. Further, corporate general and administrative expenses decreased for the third consecutive qu
For The Three Months Ended For The Nine Months Ended
(Unaudited) (Unaudited)
September 25998 September 26, 1997 September 25, 1998 September 26, 1997
Revenues:
$6,614,203 $5,744,926 $20,525,107 $17,347,775
Net loss applicable to common stockholders
$(2,567,346) $(2,648,497) $(6,930,066) $(8,090,429)a
Net loss per common share
$ (0.03) $ ( 0.03) $ (0.07) $ (0.09)
Weighted average number of shares of common stock outstanding
100,906,864 90,782,693 100,688,912 86,418,725
a. includes a deemed dividend of $1,500,000
November 6, 1998
Dear Shareholders:
By holding to the HEARx vision, we are continuing to strengthen and secure our position as the leading provider of hearing care to the managed care marketplace. Recently enacted State legislation (New York) combined with increasing hearing aid benefits from healthcare providers indicates that the hearing care industry continues to change for the better. By December 1, 1998 about 8.5% of the approximate 5.8 million Medicare eligible individuals will be covered by HEARx on a per member/per month payment basis for hearing care. In total, HEARx has more than 170 contracts for hearing care with various healthcare providers. HEARx offers a diverse selection of hearing aids dispensed by licensed professionals and is the only hearing care company accredited by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO).
We believe that competition among the managed care organizations for members will intensify in the core markets now serviced by us. It appears there will be restrictions or elimination of "open-ended" benefits such as pharmacy or dental care. We believe this will mean an expansion of "limited risk" benefits such as hearing care in order to attract new members. As a provider of hearing care primarily to the managed care market, we will grow as our contract providers grow with new members and into other markets.
As previously announced, we recently formed a new company "HEARx West LLC"--a nationwide joint venture in hearing care with Kaiser Permanente. In addition to being a 50% owner of the venture, HEARx Ltd. has been contracted to manage the new company, ensuring the implementation of HEARx standardization and quality control. Construction has commenced in a number of sites and the first employee-training group has already started. The Company will be reimbursed annually over $1.5 million for its general and administrative costs associated with management of this venture. The initial 15 centers servicing the Southern California market are targeted to open in early January. Four additional centers are anticipated to open each quarter thereafter during 1999. The demographics of the market in Southern California indicate an annual expenditure of approximately $170 million per year for hearing care.
To provide the capital for our California expansion, a $7.5 million equity offering was completed which provided us the funds to loan the new venture up to $5 million. In addition, based on the current price of our shares, the HEARx Board of Directors has authorized the repurchase in the "open market" of up to 20 million shares of common stock over the next 12 to 18 months. Funding for such purchases, if and when made, will come from the Company's available cash, profits from operations and, if available on favorable terms, a line of credit to be established for this purpose.
HEARx is profitable and growing in Florida (nine-month sales are up approximately 40%). However, continued losses in the Northeast market have resulted from the difficulties that several of our contracted providers have been having. We expect to close on several new contracts in the Northeast soon and that combined with the initiation of several previously announced contracts in that region, should increase revenues and decrease center losses. Corporate overhead has steadily decreased since the fourth quarter of 1997.
We believe that our financial strength combined with the experience of our management team will enable us to capitalize on the potential of the hearing care market with our unique strategy. HEARx's courage to be on the cutting edge of keeping us a "hearing" nation places us at the right place at the right time, positioned to ensure HEARx as a growth company for years to come.
Yours truly,
Paul A. Brown, M.D.
Chairman
For More Information Contact:
HEARX, Ltd.
1250 Northpoint Parkway, West Palm Beach, FL 33407
Tel: 561-478-8770
FAX: 561-478-9603
Internet: info@hearx.com |
