- Highest Revenue Quarter in Company's
25 year history
- Revenues for the quarter increased
14% year over year
- Adjusted EBITDA for the quarter
increased to $4.0 million
- Sixteenth straight quarter of year
over year revenue growth
InfuSystem Holdings, Inc. (NYSE Amex:INFU), the leading national
provider of infusion pumps and related services, today reported
results for the third quarter ended September 30, 2011.
Revenues for the third quarter of fiscal 2011 were $14.5 million
compared with $12.7 million for the prior year, up 14 percent.
Adjusted EBITDA for the third quarter of fiscal 2011 was $4.0
million, versus $3.9 million a year ago.
Mr. Sean McDevitt, Chief Executive Officer and Chairman,
commented, "We reported a solid performance this past quarter
delivering 14% of almost entirely organic growth over the same
period last year. This was our sixteenth straight quarter of year
over year revenue growth and a milestone in that our employees
achieved the highest quarterly revenues in InfuSystem's 25 year
history. On a sequential quarter over quarter basis, we grew
revenue over 10%. In regard to the oncology drug shortage, it
continued to have a slight impact in the third quarter. The
drug shortage's impact was offset through our stated strategy of
diversifying our revenue stream and business mix, while maintaining
and strengthening our strong leadership in the consignment business
by adding new customers."
Mr. McDevitt continued, "InfuSystem remains committed to its
core vision of becoming a significant leader in the infusion and
pre-owned medical equipment markets, increasing revenue,
maintaining attractive EBITDA margins, generating substantial free
cash flow, paying down debt, and improving our overall financial
profile. Additionally, our goal remains to achieve top line
revenues of several hundred million dollars in our target markets
over the next several years and additive, synergistic acquisitions
will be a key part of that growth," Mr. McDevitt concluded.
Revenues for the third quarter ending September 30, 2011 were
$14.5 million, up 14 percent from $12.7 million in the prior year
period. The increase in revenues is related to obtaining
business at new customer facilities and expansion into new product
lines associated with our acquisitions.
Gross profit for the three months ending September 30, 2011 was
$9.2 million, up 4 percent from $8.9 million in the prior year
period. Gross margins were 64 percent of revenues for the
latest quarter compared with 70 percent in the prior year period.
The decrease in the gross margin percentage was primarily
related to a higher mix of pump sales, services, and rentals as
compared to third party billings.
Selling, general and administrative expenses (SG&A) for the
third quarter of 2011 were $8.3 million, excluding a goodwill and
intangible assets impairment charge of $23.4 million, 3 percent
higher than the $8.1 million in the prior year period. The
increase was due to strategic investments made in the sales
organization, such as the launch of our iPad-based electronic
paperwork system, amortization of intangibles, and professional
fees. These expenses were partially offset by the decreases in
stock based compensation and bad debt expenses. As a percent
of revenues, SG&A was 58 percent compared to 63 percent for the
prior period.
As of September 30, 2011, the company determined that given the
significant decline in our market capitalization that there was an
indicator to require an interim goodwill impairment
analysis. Based upon the impairment analysis performed as of
September 30, 2011, the company concluded there was an impairment
of the remaining goodwill that resulted in a non-cash charge of
$23.4 million.
Other loss for the third quarter of 2011 was $0.7 million versus
$0.4 million other loss in the prior year period, reflecting
reduced interest expense and no gain on derivatives as incurred in
the prior year. The provision for income taxes was a benefit of
$6.5 million for the quarter compared to an expense of $295
thousand in the prior year period. As a result, the second
quarter net loss was $16.6 million, driven by the non-cash goodwill
impairment charge, equal to $0.79 per diluted share, versus a $174
thousand net income, equal to $0.01 per diluted share in the prior
year period.
Adjusted EBITDA was $4.0 million for the third quarter of 2011
versus $3.9 million in the prior year period. The company
utilizes Adjusted EBITDA as a means to measure its operating
performance. A reconciliation of Adjusted EBITDA, a non-GAAP
measure, to net income can be found in the appendix.
Financial Condition
Net cash provided by operations for the nine months ending
September 30, 2011 was $4.2 million, compared to $7.8 million for
the prior period. Principal and interest payments of $2.0
million, on our term loan and capital leases, were paid during the
quarter. The company ended the quarter with a cash balance of
$0.4 million with $23.8 million in long-term debt, net of
current.
Conference Call
InfuSystem Holdings, Inc. will host a conference call to share
the results of its third quarter fiscal 2011 results on Thursday,
November 10, at 10:00 a.m. Eastern Time. Chairman and Chief
Executive Officer Sean McDevitt and Jim Froisland, Chief Financial
Officer, will discuss the company's financial performance and
answer questions from the financial community.
The company invites interested investors to listen to the
presentation, which will be carried live on the company's Web site:
www.infusystem.com in the Investors section. To participate
by telephone, the dial-in number is 800-447-0521 with confirmation
number 30770688. Those who wish to listen should either dial in or
go to the web site several minutes prior to the call to register. A
replay of the call can be accessed by dialing 888-843-7419,
passcode 30770688#. An online archive of the conference call
will remain on the company's website for the following 30 days.
About InfuSystem Holdings, Inc.
InfuSystem Holdings, Inc. is the leading provider of infusion
pumps and related services to hospitals, oncology practices and
other alternate site healthcare providers. Headquartered in
Madison Heights, Michigan, the company delivers local, field-based
customer support, and also operates Centers of Excellence in
Michigan, Kansas, California, and Ontario, Canada. The
company's stock is traded on the NYSE Amex under the symbol
INFU.
Forward-Looking Statements
Except for the historical information contained herein, the
matters discussed in this press release are forward-looking
statements that involve risks and uncertainties that could cause
actual results to differ materially form those predicted by such
forward-looking statements. These risks and uncertainties
include general economic conditions, as well as other risks,
detailed from time to time in the company's publicly filed
documents.
Additional information about InfuSystem Holdings, Inc.
is available at www.infusystem.com.
FINANCIAL TABLES FOLLOW
InfuSystem Holdings,
Inc. Announces Third Quarter, Fiscal 2011 Results |
|
|
|
INFUSYSTEM HOLDINGS,
INC. AND SUBSIDIARIES |
CONSOLIDATED BALANCE
SHEETS |
|
|
|
|
|
|
|
September 30, |
December 31, |
(in thousands, except share
data) |
2011 |
2010 |
|
(Unaudited) |
|
ASSETS |
|
|
Current Assets: |
|
|
Cash and cash equivalents |
$ 433 |
$ 5,014 |
Accounts receivable, less allowance for
doubtful accounts of $1,719 and |
|
|
$1,796 at September 30, 2011 and December
31, 2010, respectively |
7,983 |
6,679 |
Inventory |
2,155 |
1,699 |
Prepaid expenses and other current
assets |
736 |
750 |
Deferred income taxes |
1,249 |
1,147 |
|
|
|
Total Current Assets |
12,556 |
15,289 |
Property & equipment, net |
16,883 |
16,672 |
Deferred debt issuance costs, net |
477 |
658 |
Goodwill |
-- |
64,092 |
Intangible assets, net |
28,683 |
33,252 |
Deferred income taxes |
20,135 |
-- |
Other assets |
758 |
401 |
|
|
|
Total Assets |
$ 79,492 |
$ 130,364 |
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
Current Liabilities: |
|
|
Accounts payable |
$ 1,945 |
$ 2,016 |
Other current liabilities |
2,061 |
4,631 |
Derivative liabilities |
302 |
183 |
Current portion of long-term debt |
6,465 |
5,551 |
|
|
|
Total Current Liabilities |
10,773 |
12,381 |
Long-term debt, net of current portion |
23,783 |
26,646 |
Deferred income taxes |
3,250 |
5,788 |
Other liabilities |
965 |
406 |
|
|
|
Total Liabilities |
$ 38,771 |
$ 45,221 |
|
|
|
Stockholders' Equity |
|
|
Preferred stock, $.0001 par value: authorized
1,000,000 shares; none issued |
-- |
-- |
Common stock, $.0001 par value; authorized
200,000,000 shares; issued 21,244,916 |
1 |
2 |
and 21,163,337, respectively; outstanding
21,048,076 and 21,117,516, respectively |
|
|
Additional paid-in capital |
87,362 |
87,004 |
Accumulated other comprehensive loss |
(165) |
(64) |
Retained deficit |
(46,477) |
(1,799) |
|
|
|
Total Stockholders' Equity |
$ 40,721 |
$ 85,143 |
|
|
|
Total Liabilities and Stockholders'
Equity |
$ 79,492 |
$ 130,364 |
|
InfuSystem Holdings,
Inc. Announces Third Quarter, Fiscal 2011 Results |
|
|
|
|
|
INFUSYSTEM HOLDINGS,
INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS
OF OPERATIONS |
(UNAUDITED) |
|
|
|
|
|
|
Three Months
Ended |
Nine Months
Ended |
|
September
30 |
September
30 |
(in thousands, except share
data) |
2011 |
2010 |
2011 |
2010 |
|
|
|
|
|
Net revenues |
$ 14,505 |
$ 12,733 |
$ 40,595 |
$ 34,154 |
|
|
|
|
|
Cost of revenues: |
|
|
|
|
Cost of revenues — Product, service and
supply costs |
2,346 |
2,130 |
6,662 |
5,524 |
Cost of revenues — Pump depreciation,
sales and disposals |
2,927 |
1,706 |
6,659 |
4,094 |
Gross profit |
9,232 |
8,897 |
27,274 |
24,536 |
|
|
|
|
|
Selling, general and administrative
expenses: |
|
|
|
|
Provision for doubtful accounts |
884 |
986 |
3,033 |
3,454 |
Amortization of intangibles |
683 |
624 |
1,992 |
1,615 |
Asset impairment charges |
23,379 |
-- |
67,592 |
-- |
Selling and marketing |
2,320 |
1,702 |
7,089 |
4,739 |
General and administrative |
4,460 |
4,757 |
13,227 |
12,662 |
|
|
|
|
|
Total sales, general and
administrative: |
31,726 |
8,069 |
92,933 |
22,470 |
|
|
|
|
|
Operating (loss) income |
(22,494) |
828 |
(65,659) |
2,066 |
|
|
|
|
|
Other loss: |
|
|
|
|
Gain (loss) on derivatives |
-- |
250 |
83 |
(210) |
Interest expense |
(541) |
(609) |
(1,646) |
(2,781) |
Gain on extinguishment of long term
debt |
-- |
-- |
-- |
1,118 |
Other income |
(118) |
-- |
(118) |
-- |
|
|
|
|
|
Total other loss |
(659) |
(359) |
(1,681) |
(1,873) |
|
|
|
|
|
(Loss) before income taxes |
(23,153) |
469 |
(67,340) |
193 |
Income tax benefit (expense) |
6,530 |
(295) |
22,661 |
112 |
|
|
|
|
|
Net (loss) income |
$ (16,623) |
$ 174 |
$ (44,679) |
$ 305 |
|
|
|
|
|
Net (loss) income per share: |
|
|
|
|
Basic |
$ (0.79) |
$ 0.01 |
$ (2.12) |
$ 0.02 |
Diluted |
$ (0.79) |
$ 0.01 |
$ (2.12) |
$ 0.01 |
Weighted average shares outstanding: |
|
|
|
|
Basic |
21,067,502 |
19,904,648 |
21,076,241 |
19,539,326 |
Diluted |
21,067,502 |
21,647,904 |
21,076,241 |
20,742,765 |
|
InfuSystem Holdings,
Inc. Announces Third Quarter, Fiscal 2011 Results |
|
|
|
INFUSYSTEM HOLDINGS,
INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS
OF CASH FLOWS |
(UNDAUDITED) |
|
|
|
|
Nine Months
Ended |
|
September
30 |
(in thousands) |
2011 |
2010 |
|
|
|
OPERATING ACTIVITIES |
|
|
Net (loss) income |
$ (44,679) |
$ 305 |
Adjustments to reconcile net (loss) income to
net cash provided by |
|
|
operating activities: |
|
|
(Gain) loss on derivative
liabilities |
(84) |
210 |
Gain on extinguishment of long-term
debt |
-- |
(1,118) |
Provision for doubtful accounts |
3,033 |
3,454 |
Depreciation |
4,890 |
3,869 |
Net book value of pumps sold from fixed
assets |
2,111 |
510 |
Amortization of intangible assets |
1,992 |
1,615 |
Asset impairment charges |
67,592 |
-- |
Amortization of deferred debt issuance
costs |
181 |
915 |
Stock-based compensation |
921 |
1,811 |
Deferred income taxes |
(22,673) |
(519) |
Changes in assets and liabilities, exclusive
of effects of acquisitions: |
|
|
Increase in accounts receivable, net of
provision |
(4,337) |
(3,556) |
Increase in other current assets |
(442) |
(89) |
(Increase) decrease in other assets |
(70) |
170 |
(Decrease) increase in accounts payable
and other liabilities |
(4,187) |
553 |
Decrease in derivative liabilities from
termination of interest rate swap |
-- |
(365) |
|
|
|
NET CASH PROVIDED BY OPERATING
ACTIVITIES |
4,248 |
7,765 |
|
|
|
INVESTING ACTIVITIES |
|
|
Capital expenditures |
(3,295) |
(992) |
Acquisition of intangible assets |
(942) |
(400) |
Cash paid for acquisition, net of
cash acquired |
-- |
(16,418) |
|
|
|
NET CASH (USED IN) INVESTING ACTIVITIES |
(4,237) |
(17,810) |
|
|
|
FINANCING ACTIVITIES |
|
|
Principal payments on term
loan |
(3,287) |
(21,596) |
Cash proceeds from term
loan |
-- |
30,000 |
Capitalized debt issuance
costs |
-- |
(808) |
Common stock repurchased to
satisfy statutory |
|
|
witholding on stock based
compensation |
-- |
(38) |
Treasury shares repurchased |
(343) |
-- |
Principal payments on capital lease
obligations |
(962) |
(571) |
|
|
|
NET CASH (USED IN) PROVIDED BY FINANCING
ACTIVITIES |
(4,592) |
6,987 |
|
|
|
Net change in cash and cash equivalents |
(4,581) |
(3,058) |
Cash and cash equivalents, beginning of
period |
5,014 |
7,750 |
|
|
|
Cash and cash equivalents, end of period |
$ 433 |
$ 4,692 |
|
InfuSystem Holdings,
Inc. Announces Third Quarter, Fiscal 2011 Results |
|
|
|
|
|
INFUSYSTEM HOLDINGS,
INC. AND SUBSIDIARIES |
GAAP
RECONCILIATION |
(UNAUDITED) |
|
|
|
|
|
|
Three Months
Ended |
Nine Months
Ended |
|
September
30 |
September
30 |
(in thousands, except share
data) |
2011 |
2010 |
2011 |
2010 |
|
|
|
|
|
Net (loss) income |
$ (16,623) |
$ 174 |
$ (44,679) |
$ 305 |
Adjustments: |
|
|
|
|
Interest expense |
541 |
609 |
1,646 |
2,781 |
Income tax (benefit)
expense |
(6,530) |
295 |
(22,661) |
(112) |
Depreciation |
1,721 |
1,487 |
4,890 |
3,869 |
Amortization |
683 |
624 |
1,992 |
1,615 |
EBITDA |
(20,208) |
3,189 |
(58,812) |
8,458 |
Adjustments: |
|
|
|
|
Asset impairment charges |
23,379 |
-- |
67,592 |
-- |
(Gain) loss on derivatives |
-- |
(250) |
(83) |
210 |
Stock based compensation |
420 |
814 |
921 |
1,811 |
Sales and other incentives |
|
|
699 |
|
Acquisition related expenses |
396 |
180 |
643 |
965 |
Severance |
|
|
65 |
|
Gain on debt extinguishment |
-- |
-- |
-- |
(1,118) |
Adjusted EBITDA |
$ 3,987 |
$ 3,933 |
$ 11,025 |
$ 10,326 |
CONTACT: INVESTOR CONTACT:
Pat LaVecchia
Vice Chairman
Info@InfuSystem.com
800-962-9656