Nationshealth (NASDAQ:NHRXU)
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NationsHealth, Inc. (Nasdaq: NHRX; NHRXW; NHRXU) today announced its
financial results for its quarter and nine months ended September 30,
2006.
Revenue for the quarter ended September 30, 2006 was $19.8 million
compared to $21.3 million for the corresponding period in 2005. Net
income for the quarter ended September 30, 2006 was $6.0 million, or
$0.22 per diluted share, compared to net income of $11.8 million, or
$0.40 per diluted share, for the corresponding period in 2005.
For the nine months ended September 30, 2006, revenue was $64.4 million
compared to $62.4 million for the corresponding period in 2005. Net loss
for the nine months ended September 30, 2006 was $12.5 million, or $0.45
per share, compared to a net loss of $1.9 million, or $0.07 per share,
for the corresponding period in 2005.
Revenue for the quarter and nine months ended September 30, 2005
included approximately $5.7 million and $18.8 million, respectively,
from the Company’s respiratory division,
which was sold on September 2, 2005. Net income (loss) for the quarter
and nine months ended September 30, 2005 also included a gain of $15.5
million from the sale of the respiratory division. Net income (loss) for
the quarter and nine months ended September 30, 2006 include a gain of
$5.0 million from the sale of the Company’s
discount prescription drug card business, which was sold on September 5,
2006.
Adjusted EBITDA (EBITDA loss)*, defined as net
earnings (loss) before interest, taxes, depreciation and amortization,
stock based compensation, non-cash impairment charges and gains on the
sale of business lines, for the quarter ended September 30, 2006 was
$4.4 million, compared to an adjusted EBITDA loss of $1.3 million for
the quarter ended June 30, 2006. Adjusted EBITDA (EBITDA loss) for the
quarters ended September 30, 2006 and June 30, 2006 included gains on
the settlement of vendor obligations of approximately $1.0 million and
$1.7 million, respectively. Adjusted EBITDA loss for the quarter ended
June 30, 2006 also included $1.2 million of severance expense related to
the Company’s corporate restructuring.
The Company’s Insurance Services segment
contributed profit of $3.7 million for the quarter ended September 30,
2006, compared to profit of $2.4 million for the quarter ended June 30,
2006. The Pharmacy Products segment contributed profit of $3.4 million
for the quarter ended September 30, 2006, compared to profit of $1.6
million for the quarter ended June 30, 2006. For the nine months ended
September 30, 2006, the Insurance Services segment had a loss of
approximately $1.8 million and the Pharmacy Products segment contributed
profit of approximately $7.3 million.
During the third quarter of 2006 NationsHealth took a number of steps to
better align the Company's focus on its core business segments, improve
operating results and cash flow, strengthen its balance sheet and
improve liquidity, including the following:
On September 5, 2006, the Company sold its discount prescription drug
card business for $6.0 million in cash. With the widespread adoption
of the Medicare Part D program, the discount prescription card
business was a declining revenue stream that was no longer core or
complementary to the Company’s Pharmacy
Products and Insurance Services segments;
On September 13, 2006, the Company terminated a distribution agreement
with a vendor, pursuant to which the Company paid the vendor
approximately $4.4 million in full satisfaction of approximately $5.4
million due under the agreement and relieved itself of remaining
purchase obligations under the agreement through December 31, 2006
totaling approximately $27 million;
On September 27, 2006, the Company entered into an agreement to
dissolve NationsHealth Specialty Rx, a joint venture with US
Bioservices Corporation (US Bio) which was formed for purposes of
developing and operating a specialty oncology pharmacy business. The
Company and US Bio determined that the terms of the Competitive
Acquisition Program established by CMS were not economically viable
and, consequently, Specialty Rx never commenced operations. In
connection with the dissolution, its $1.5 million capital contribution
to Specialty Rx was returned to the Company on October 5, 2006; and
During the third quarter of 2006, the Company’s
ongoing efforts to improve operational efficiencies and contain costs
continued, resulting in, among other things, improvements in operating
margins for the Pharmacy Products and Insurance Services segments.
“Excluding the $5.0 million gain on the sale
of the discount prescription drug card business, the $1.0 million gain
on the settlement of a vendor obligation, and the $0.6 million non-cash
impairment charge from reported net income of $6.0 million, the third
quarter of 2006 yielded $0.6 million of pre-tax earnings*,”
said Timothy Fairbanks, the Company’s Chief
Financial Officer. “Our third quarter
financial results reflected the positive impact of our management
restructuring, cost containment and efficiency initiatives implemented
in the first half of 2006. Also, since the end of the open enrollment
period for the Medicare Part D Prescription Drug Program during the
second quarter of 2006, we are no longer incurring, and under our
amended agreement with CIGNA will no longer incur, the high costs of
marketing and enrollment.”
As previously announced, NationsHealth will host a conference call at
10:00 a.m. ET today to review its financial results for the quarter and
nine months ended September 30, 2006.
Access Information:
Date: October 31, 2006
Time: 10:00 a.m. ET
U.S./Canada dial-in number: 800-665-0430
International dial-in number: 913-312-1300
Participant passcode: 8144626
Live webcast: www.nationshealth.com
Replay Access Information:
A recording of the conference call will be available three hours after
completion until November 6, 2006 at midnight ET at 888-203-1112 (U.S.)
and 719-457-0820 (International). The replay passcode is 8144626. The
webcast will be archived for on demand listening for 30 days on the
NationsHealth’s website, www.nationshealth.com.
About NationsHealth, Inc.
NationsHealth improves the delivery of healthcare to Medicare and
managed care beneficiaries by providing medical products and
prescription related services. NationsHealth provides home delivery of
diabetes, ostomy and pharmacy products to approximately 102,000 patients
across the nation. NationsHealth is also the provider of diabetes
supplies to more than 13,000 Medicare beneficiaries at over 1,100 Kmart
pharmacies. In addition to its medical products business, NationsHealth
also provides education, marketing, enrollment and customer service to
insurance plans, with a focus on Medicare Part D plans. NationsHealth
has an agreement with CIGNA to service its Medicare Part D prescription
drug plans nationally. For more information please visit http://www.nationshealth.com.
* Use of Non-GAAP Financial Measures
In its earnings releases, conference calls, slide presentations or
webcasts, the Company may use or discuss adjusted EBITDA, which is a
non-GAAP financial measure as defined by SEC Regulation G. Management
regularly reviews adjusted EBITDA (EBITDA loss) as an analytical
indicator of the Company’s financial
performance and believes that it is useful to investors in evaluating
operating performance. In addition, the Company uses adjusted EBITDA
(EBITDA loss) as a measure of performance for its business segments and
for incentive compensation purposes. The Company does not intend for
adjusted EBITDA to be considered in isolation or as a substitute for any
GAAP measure. Adjusted EBITDA (EBITDA loss), as presented, may not be
comparable to similarly titled measures of other companies.
Net income (loss) is the GAAP financial measure most directly comparable
to adjusted EBITDA (EBITDA loss). A reconciliation of adjusted EBITDA
(EBITDA loss) to net income (loss) is as follows (in thousands):
Three Months Ended
September 30, 2006
June 30, 2006
Net Income (Loss)
$
6,020
($4,997)
Interest, net
778
727
Depreciation and amortization
488
457
Amortization of equity issued to CIGNA
969
969
Stock-based compensation
585
830
Non-cash impairment charge
559
733
Gain on sale of business line
(5,000)
--
Adjusted EBITDA (EBITDA Loss)
$
4,399
($1,281)
In addition, management believes that the presentation of pre-tax
earnings for the quarter ended September 30, 2006, excluding certain
items from net income, is meaningful as the items excluded are not
considered to be indicative of the Company's ongoing operations and
financial results.
This press release contains forward-looking statements about
NationsHealth, including statements regarding management initiatives,
efforts to streamline operations, and future marketing and enrollment
costs, none of which should be construed in any manner as a guarantee
that such results will in fact occur. In addition, other written or oral
statements that constitute forward-looking statements may be made by us
or on our behalf. Forward-looking statements are statements that are not
historical facts, and in some cases may be identified by the words “anticipate,”
“project,” “expect,”
“plan,” “intend,”
“may,” “should,”
“will,” and
similar words or phrases. Such forward-looking statements, based upon
the current beliefs and expectations of NationsHealth’s
management, are subject to risks and uncertainties, which could cause
actual results to differ from the forward-looking statements. The
following factors, among others, could cause actual results to differ
from those set forth in the forward-looking statements: our ability to
maintain our existing customer base; our customers’
desire to take advantage of our Part D and specialty pharmacy services;
uncertainty in our costs incurred in administering the Part D program;
changes in Medicare, Medicaid, Tricare, Champus and any other state or
national-based reimbursement program; changing interpretations of
generally accepted accounting principles; outcomes of government reviews
of NationsHealth’s business practices;
inquiries and investigations and related litigation; continued
compliance with government regulations; legislation or regulatory
requirements or changes adversely affecting the businesses in which
NationsHealth is engaged; fluctuations in customer demand; management of
rapid growth; our ability to compete effectively; timing and market
acceptance of new products sold by NationsHealth; general economic
conditions; and geopolitical events, regulatory changes and other risks
and uncertainties described in NationsHealth’s
Annual Report on Form 10-K for the year ended December 31, 2005,
Quarterly Report on Form 10-Q for the quarter ended March 31, 2006 and
NationsHealth’s other reports filed with the
Securities and Exchange Commission. The information set forth herein
should be read in light of such risks. NationsHealth cautions investors
not to place undue reliance on the forward-looking statements contained
herein. These statements speak only as of the date of this press release
and, except as required by applicable law, NationsHealth assumes no
obligation to update the information contained herein.
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share data)
Three Months Ended
September 30,
2006
2005
Revenue:
Net product sales
$
11,811
$
18,167
Prescription card revenue
671
2,316
Service revenue
7,314
780
19,796
21,263
Cost of product sales
4,233
8,037
Cost of services
2,430
1,311
Gross Profit
13,133
11,915
Operating Expenses:
Patient acquisition and related costs
149
3,256
Patient service and fulfillment
1,839
3,593
General and administrative
6,457
5,576
Provision for doubtful accounts
998
2,330
Depreciation and amortization
364
224
Amortization of equity issued to CIGNA
969
--
Impairment of investment in joint venture
559
--
Gain on sale of business line
(5,000)
(15,508)
6,335
(529)
Income from Operations
6,798
12,444
Other Expense, net
(778)
(652)
Net Income
$
6,020
$
11,792
Earnings per share:
Basic
$
0.22
$
0.45
Diluted
$
0.22
$
0.40
Weighted average shares outstanding:
Basic
27,919
26,283
Diluted
27,921
30,105
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share data)
Nine Months Ended
September 30,
2006
2005
Revenue:
Net product sales
$
33,555
$
55,299
Prescription card revenue
3,983
6,327
Service revenue
26,889
780
64,427
62,406
Cost of product sales
14,424
23,448
Cost of services
25,685
1,311
Gross Profit
24,318
37,647
Operating Expenses:
Patient acquisition and related costs
2,793
17,976
Patient service and fulfillment
6,382
11,418
General and administrative
22,428
15,193
Provision for doubtful accounts
2,844
7,575
Depreciation and amortization
1,030
653
Amortization of equity issued to CIGNA
2,908
--
Impairment of investment in joint venture
1,292
--
Gain on sale of business line
(5,000)
(15,508)
34,677
37,307
(Loss) Income from Operations
(10,359)
340
Other Expense, net
(2,148)
(2,222)
Net Loss
$
(12,507)
$
(1,882)
Loss per share – basic and diluted
$
(0.45)
$
(0.07)
Weighted average shares outstanding –
basic and diluted
27,871
26,211
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30,
December 31,
2006
2005
(unaudited)
ASSETS
Current Assets:
Cash and short-term investments
$
2,763
$
14,894
Accounts receivable, net
5,834
7,908
Inventory
1,233
1,285
Costs related to billings in process, net
879
874
Other receivables
1,640
1,877
Prepaid expenses and other current assets
442
750
Total current assets
12,791
27,588
Property and equipment, net
3,556
3,747
Investment in joint venture
--
1,488
Deferred CIGNA equity compensation, net
12,602
15,510
Other assets, net
1,657
1,526
Total assets
$
30,606
$
49,859
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable
$
2,359
$
13,387
Accrued expenses
9,004
12,030
Deferred revenue, current portion
1,774
235
Line of credit
2,500
2,500
Total current liabilities
15,637
28,152
Long-Term Liabilities:
Deferred revenue
--
1,100
Convertible notes, related party, net
6,009
5,176
Other long-term liabilities
3,080
1,414
Total long-term liabilities
9,089
7,690
Stockholders' Equity
5,880
14,017
Total liabilities and stockholders' equity
$
30,606
$
49,859
NationsHealth, Inc. (Nasdaq: NHRX; NHRXW; NHRXU) today announced
its financial results for its quarter and nine months ended September
30, 2006.
Revenue for the quarter ended September 30, 2006 was $19.8 million
compared to $21.3 million for the corresponding period in 2005. Net
income for the quarter ended September 30, 2006 was $6.0 million, or
$0.22 per diluted share, compared to net income of $11.8 million, or
$0.40 per diluted share, for the corresponding period in 2005.
For the nine months ended September 30, 2006, revenue was $64.4
million compared to $62.4 million for the corresponding period in
2005. Net loss for the nine months ended September 30, 2006 was $12.5
million, or $0.45 per share, compared to a net loss of $1.9 million,
or $0.07 per share, for the corresponding period in 2005.
Revenue for the quarter and nine months ended September 30, 2005
included approximately $5.7 million and $18.8 million, respectively,
from the Company's respiratory division, which was sold on September
2, 2005. Net income (loss) for the quarter and nine months ended
September 30, 2005 also included a gain of $15.5 million from the sale
of the respiratory division. Net income (loss) for the quarter and
nine months ended September 30, 2006 include a gain of $5.0 million
from the sale of the Company's discount prescription drug card
business, which was sold on September 5, 2006.
Adjusted EBITDA (EBITDA loss)*, defined as net earnings (loss)
before interest, taxes, depreciation and amortization, stock based
compensation, non-cash impairment charges and gains on the sale of
business lines, for the quarter ended September 30, 2006 was $4.4
million, compared to an adjusted EBITDA loss of $1.3 million for the
quarter ended June 30, 2006. Adjusted EBITDA (EBITDA loss) for the
quarters ended September 30, 2006 and June 30, 2006 included gains on
the settlement of vendor obligations of approximately $1.0 million and
$1.7 million, respectively. Adjusted EBITDA loss for the quarter ended
June 30, 2006 also included $1.2 million of severance expense related
to the Company's corporate restructuring.
The Company's Insurance Services segment contributed profit of
$3.7 million for the quarter ended September 30, 2006, compared to
profit of $2.4 million for the quarter ended June 30, 2006. The
Pharmacy Products segment contributed profit of $3.4 million for the
quarter ended September 30, 2006, compared to profit of $1.6 million
for the quarter ended June 30, 2006. For the nine months ended
September 30, 2006, the Insurance Services segment had a loss of
approximately $1.8 million and the Pharmacy Products segment
contributed profit of approximately $7.3 million.
During the third quarter of 2006 NationsHealth took a number of
steps to better align the Company's focus on its core business
segments, improve operating results and cash flow, strengthen its
balance sheet and improve liquidity, including the following:
-- On September 5, 2006, the Company sold its discount
prescription drug card business for $6.0 million in cash. With
the widespread adoption of the Medicare Part D program, the
discount prescription card business was a declining revenue
stream that was no longer core or complementary to the
Company's Pharmacy Products and Insurance Services segments;
-- On September 13, 2006, the Company terminated a distribution
agreement with a vendor, pursuant to which the Company paid
the vendor approximately $4.4 million in full satisfaction of
approximately $5.4 million due under the agreement and
relieved itself of remaining purchase obligations under the
agreement through December 31, 2006 totaling approximately $27
million;
-- On September 27, 2006, the Company entered into an agreement
to dissolve NationsHealth Specialty Rx, a joint venture with
US Bioservices Corporation (US Bio) which was formed for
purposes of developing and operating a specialty oncology
pharmacy business. The Company and US Bio determined that the
terms of the Competitive Acquisition Program established by
CMS were not economically viable and, consequently, Specialty
Rx never commenced operations. In connection with the
dissolution, its $1.5 million capital contribution to
Specialty Rx was returned to the Company on October 5, 2006;
and
-- During the third quarter of 2006, the Company's ongoing
efforts to improve operational efficiencies and contain costs
continued, resulting in, among other things, improvements in
operating margins for the Pharmacy Products and Insurance
Services segments.
"Excluding the $5.0 million gain on the sale of the discount
prescription drug card business, the $1.0 million gain on the
settlement of a vendor obligation, and the $0.6 million non-cash
impairment charge from reported net income of $6.0 million, the third
quarter of 2006 yielded $0.6 million of pre-tax earnings*," said
Timothy Fairbanks, the Company's Chief Financial Officer. "Our third
quarter financial results reflected the positive impact of our
management restructuring, cost containment and efficiency initiatives
implemented in the first half of 2006. Also, since the end of the open
enrollment period for the Medicare Part D Prescription Drug Program
during the second quarter of 2006, we are no longer incurring, and
under our amended agreement with CIGNA will no longer incur, the high
costs of marketing and enrollment."
As previously announced, NationsHealth will host a conference call
at 10:00 a.m. ET today to review its financial results for the quarter
and nine months ended September 30, 2006.
-0-
*T
Access Information:
Date: October 31, 2006
Time: 10:00 a.m. ET
U.S./Canada dial-in number: 800-665-0430
International dial-in number: 913-312-1300
Participant passcode: 8144626
Live webcast: www.nationshealth.com
*T
Replay Access Information:
A recording of the conference call will be available three hours
after completion until November 6, 2006 at midnight ET at 888-203-1112
(U.S.) and 719-457-0820 (International). The replay passcode is
8144626. The webcast will be archived for on demand listening for 30
days on the NationsHealth's website, www.nationshealth.com.
About NationsHealth, Inc.
NationsHealth improves the delivery of healthcare to Medicare and
managed care beneficiaries by providing medical products and
prescription related services. NationsHealth provides home delivery of
diabetes, ostomy and pharmacy products to approximately 102,000
patients across the nation. NationsHealth is also the provider of
diabetes supplies to more than 13,000 Medicare beneficiaries at over
1,100 Kmart pharmacies. In addition to its medical products business,
NationsHealth also provides education, marketing, enrollment and
customer service to insurance plans, with a focus on Medicare Part D
plans. NationsHealth has an agreement with CIGNA to service its
Medicare Part D prescription drug plans nationally. For more
information please visit http://www.nationshealth.com.
* Use of Non-GAAP Financial Measures
In its earnings releases, conference calls, slide presentations or
webcasts, the Company may use or discuss adjusted EBITDA, which is a
non-GAAP financial measure as defined by SEC Regulation G. Management
regularly reviews adjusted EBITDA (EBITDA loss) as an analytical
indicator of the Company's financial performance and believes that it
is useful to investors in evaluating operating performance. In
addition, the Company uses adjusted EBITDA (EBITDA loss) as a measure
of performance for its business segments and for incentive
compensation purposes. The Company does not intend for adjusted EBITDA
to be considered in isolation or as a substitute for any GAAP measure.
Adjusted EBITDA (EBITDA loss), as presented, may not be comparable to
similarly titled measures of other companies.
Net income (loss) is the GAAP financial measure most directly
comparable to adjusted EBITDA (EBITDA loss). A reconciliation of
adjusted EBITDA (EBITDA loss) to net income (loss) is as follows (in
thousands):
-0-
*T
Three Months Ended
--------------------------
September 30, June 30,
2006 2006
------------- -----------
Net Income (Loss) $ 6,020 ($4,997)
Interest, net 778 727
Depreciation and amortization 488 457
Amortization of equity issued to CIGNA 969 969
Stock-based compensation 585 830
Non-cash impairment charge 559 733
Gain on sale of business line (5,000) --
------------- -----------
Adjusted EBITDA (EBITDA Loss) $ 4,399 ($1,281)
============= ===========
*T
In addition, management believes that the presentation of pre-tax
earnings for the quarter ended September 30, 2006, excluding certain
items from net income, is meaningful as the items excluded are not
considered to be indicative of the Company's ongoing operations and
financial results.
This press release contains forward-looking statements about
NationsHealth, including statements regarding management initiatives,
efforts to streamline operations, and future marketing and enrollment
costs, none of which should be construed in any manner as a guarantee
that such results will in fact occur. In addition, other written or
oral statements that constitute forward-looking statements may be made
by us or on our behalf. Forward-looking statements are statements that
are not historical facts, and in some cases may be identified by the
words "anticipate," "project," "expect," "plan," "intend," "may,"
"should," "will," and similar words or phrases. Such forward-looking
statements, based upon the current beliefs and expectations of
NationsHealth's management, are subject to risks and uncertainties,
which could cause actual results to differ from the forward-looking
statements. The following factors, among others, could cause actual
results to differ from those set forth in the forward-looking
statements: our ability to maintain our existing customer base; our
customers' desire to take advantage of our Part D and specialty
pharmacy services; uncertainty in our costs incurred in administering
the Part D program; changes in Medicare, Medicaid, Tricare, Champus
and any other state or national-based reimbursement program; changing
interpretations of generally accepted accounting principles; outcomes
of government reviews of NationsHealth's business practices; inquiries
and investigations and related litigation; continued compliance with
government regulations; legislation or regulatory requirements or
changes adversely affecting the businesses in which NationsHealth is
engaged; fluctuations in customer demand; management of rapid growth;
our ability to compete effectively; timing and market acceptance of
new products sold by NationsHealth; general economic conditions; and
geopolitical events, regulatory changes and other risks and
uncertainties described in NationsHealth's Annual Report on Form 10-K
for the year ended December 31, 2005, Quarterly Report on Form 10-Q
for the quarter ended March 31, 2006 and NationsHealth's other reports
filed with the Securities and Exchange Commission. The information set
forth herein should be read in light of such risks. NationsHealth
cautions investors not to place undue reliance on the forward-looking
statements contained herein. These statements speak only as of the
date of this press release and, except as required by applicable law,
NationsHealth assumes no obligation to update the information
contained herein.
-0-
*T
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share data)
Three Months Ended
September 30,
---------------------
2006 2005
---------- ----------
Revenue:
Net product sales $ 11,811 $ 18,167
Prescription card revenue 671 2,316
Service revenue 7,314 780
---------- ----------
19,796 21,263
Cost of product sales 4,233 8,037
Cost of services 2,430 1,311
---------- ----------
Gross Profit 13,133 11,915
---------- ----------
Operating Expenses:
Patient acquisition and related costs 149 3,256
Patient service and fulfillment 1,839 3,593
General and administrative 6,457 5,576
Provision for doubtful accounts 998 2,330
Depreciation and amortization 364 224
Amortization of equity issued to CIGNA 969 --
Impairment of investment in joint venture 559 --
Gain on sale of business line (5,000) (15,508)
---------- ----------
6,335 (529)
---------- ----------
Income from Operations 6,798 12,444
Other Expense, net (778) (652)
---------- ----------
Net Income $ 6,020 $ 11,792
========== ==========
Earnings per share:
Basic $ 0.22 $ 0.45
========== ==========
Diluted $ 0.22 $ 0.40
========== ==========
Weighted average shares outstanding:
Basic 27,919 26,283
========== ==========
Diluted 27,921 30,105
========== ==========
*T
-0-
*T
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except per share data)
Nine Months Ended
September 30,
---------------------
2006 2005
---------- ----------
Revenue:
Net product sales $ 33,555 $ 55,299
Prescription card revenue 3,983 6,327
Service revenue 26,889 780
---------- ----------
64,427 62,406
Cost of product sales 14,424 23,448
Cost of services 25,685 1,311
---------- ----------
Gross Profit 24,318 37,647
---------- ----------
Operating Expenses:
Patient acquisition and related costs 2,793 17,976
Patient service and fulfillment 6,382 11,418
General and administrative 22,428 15,193
Provision for doubtful accounts 2,844 7,575
Depreciation and amortization 1,030 653
Amortization of equity issued to CIGNA 2,908 --
Impairment of investment in joint venture 1,292 --
Gain on sale of business line (5,000) (15,508)
---------- ----------
34,677 37,307
---------- ----------
(Loss) Income from Operations (10,359) 340
Other Expense, net (2,148) (2,222)
---------- ----------
Net Loss $(12,507) $ (1,882)
========== ==========
Loss per share - basic and diluted $ (0.45) $ (0.07)
========== ==========
Weighted average shares outstanding - basic and
diluted 27,871 26,211
========== ==========
*T
-0-
*T
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands)
September December
30, 31,
2006 2005
---------- ----------
(unaudited)
ASSETS
Current Assets:
Cash and short-term investments $ 2,763 $ 14,894
Accounts receivable, net 5,834 7,908
Inventory 1,233 1,285
Costs related to billings in process, net 879 874
Other receivables 1,640 1,877
Prepaid expenses and other current assets 442 750
---------- ----------
Total current assets 12,791 27,588
Property and equipment, net 3,556 3,747
Investment in joint venture -- 1,488
Deferred CIGNA equity compensation, net 12,602 15,510
Other assets, net 1,657 1,526
---------- ----------
Total assets $ 30,606 $ 49,859
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 2,359 $ 13,387
Accrued expenses 9,004 12,030
Deferred revenue, current portion 1,774 235
Line of credit 2,500 2,500
---------- ----------
Total current liabilities 15,637 28,152
---------- ----------
Long-Term Liabilities:
Deferred revenue -- 1,100
Convertible notes, related party, net 6,009 5,176
Other long-term liabilities 3,080 1,414
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Total long-term liabilities 9,089 7,690
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Stockholders' Equity 5,880 14,017
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Total liabilities and stockholders'
equity $ 30,606 $ 49,859
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*T