A.D.A.M., Inc. Reports Fourth Quarter and Full Year 2006 Results.A.D.A.M. Completes Acquisition of Online Benefits, Inc., Reports Yearly Revenue Increase of 64% ATLANTA Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. -- A.D.A.M., Inc. (Nasdaq: ADAM Adam, the first man, in the Bible Adam (ăd`əm), [Heb.,=man], in the Bible, the first man. In the Book of Genesis, God creates humankind in his image as a species of male and female, giving them dominion over other life. ), a leading provider of health information services See Information Systems. and benefits management solutions, today reported financial results for the fourth quarter and year ended December December: see month. 31, 2006. Financial highlights for the fourth quarter and year include: * Revenues for the fourth quarter ended December 31, 2006 were $6,835,000 as compared to $2,507,000 in the year-ago period, an increase of 173%. The increase in revenue is attributable to the acquisition of Online Benefits, which was completed in August 2006, growth in A.D.A.M.'s content licensing revenues and growth in sales of A.D.A.M.'s educational and print products. * Revenues for the year ended December 31, 2006 were $16,505,000 as compared to $10,054,000 in the year-ago period, an increase of 64%. Recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. license revenues accounted for 84% of 2006 total revenues. * Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the fourth quarter ended December 31, 2006, which included severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when costs of $485,000, increased to $1,051,000 or 15.4% of revenues. Adjusted operating income for the quarter was $1,740,000, or 25.5% of revenues. * Operating income for the year ended December 31, 2006 was $3,132,000 or 19% of revenues. Adjusted operating income for the year was $4,041,000, or 24.5% of revenues. * Net income for the year ended December 31, 2006 was $2,548,000 or $0.25 per share on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, compared to net income of $7,062,000, or $0.75 per share on a fully diluted basis, for the year ended December 31, 2005. Net income for the year ended December 31, 2005 included a $5,500,000 tax benefit. Adjusted net income for the year ended December 31, 2006 was $3,457,000 or $0.34 per share on a fully diluted basis, compared to $2,106,000 or $0.22 per share on a fully diluted basis, for the year ended December 31, 2005. * As of December 31, 2006, cash and investments were approximately $7,240,000. For the year ended December 31, 2006, adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become was $4,913,000, an increase from $2,786,000 for the year ended December 31, 2005. "Last year was a transformational year for our company. We believe the acquisition of Online Benefits positions us favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. to provide the solutions small and mid-size employers need to deal with rising benefit and healthcare costs," commented Kevin S. Noland, A.D.A.M.'s president and chief executive officer. "The need for information and decision-support tools to enable consumers to become more effective participants in their benefit plan and health and wellness has never been greater, and we see continued demand for these types of services as more employers look for ways to manage costs and improve the productivity of their employees. "Additionally, we see continued demand in our healthcare markets for content and applications that speak to our client's needs for engaging their members, patients and consumer audiences in their health and wellness. We have a strong pipeline of new products that will drive our long term growth and expand our operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: , including Benergy 2G!, our next generation consumer benefits and health management portal that we are expecting to release in phases during 2006, with the initial release in the second quarter." 2006 Highlights * Completed the acquisition and integration of Online Benefits, Inc. in August 2006. Benergy[TM], Online Benefits' principal product, is a scalable benefits management solution for the small to mid-sized employer market. Benergy is distributed by more than 500 benefits brokers throughout the U.S. and is in use by more than 5,000 employers. * Signed a multi-year distribution agreement with Thomson Micromedex, a Thomson healthcare Thomson Healthcare is one of the five operating divisions of the Thomson Corporation. The division provides information and solutions to improve the cost and quality of healthcare. Thomson Healthcare is based in Connecticut with about 2,600 staff around the globe. business. Thomson Micromedex will distribute our health content products to their provider, payer and healthcare IT customers. * Selected by Walgreen Co. to provide consumer health information on Walgreens.com. * Launched several new products, including the A.D.A.M. DecisionAssist suite and Health Risk Assessment Reporting Tools to address the needs of the accelerating consumer driven health marketplace. Our DecisionAssist tools help consumers make important decisions about their healthcare options, such as whether to have a particular surgery, proceed with a test, take certain medications or use other healthcare services. Our reporting tools provide vital information about the health of employees, members, or other end users that facilitates healthy employee habits, improvements to workplace productivity, and appropriate utilization of health services health services Managed care The benefits covered under a health contract . Non-GAAP Measures Adjusted Operating Income represents operating income before severance costs, non-cash stock-based compensation expense and amortization of purchased intangibles. Adjusted Net Income represents net income before severance costs, non-cash stock-based compensation expense, amortization of purchased intangibles and the recognition of deferred income tax benefit from the re-evaluation of our income tax reserves. Adjusted EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. is computed using Adjusted Net Income. Adjusted EBITDA represents earnings before interest, taxes, depreciation, amortization and non-cash stock-based compensation expense and the recognition of deferred income tax benefit from the re-evaluation of our income tax reserves. These financial measures are not measures of financial performance in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . We believe these non-GAAP financial measures are useful because they are appropriate measures for evaluating our operating performance. We present these non-GAAP financial measures to provide additional information regarding our performance and because they are measures by which we gauge our profitability. You should not consider these non-GAAP financial measures as an alternative to net income. Our calculation of these financial measures may be different from the calculations used by other companies and, as a result, comparability may be limited. Investors are encouraged to review the reconciliation of the non-GAAP financial measures used in this press release to the most directly comparable GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). financial measure as provided with the financial results attached to this press release. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Except for historical information, all of the statements, expectations and assumptions contained in this press release are forward-looking statements. These statements, especially revenue, net income and cash flow forecasts, involve a number of risks and uncertainties that could cause actual results, performance or developments to differ materially. Factors that could affect the company's actual results, performance or developments include general economic conditions, development of the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the as a source of health information, pricing actions taken by competitors, demand for the company's health information, the ability to realize the anticipated benefits of the acquisition, regulatory changes in laws and regulations that impact how the company conducts its business and the other factors described in A.D.A.M.'s filings with the SEC. A.D.A.M. disclaims any obligation or duty to update any of its forward-looking statements. Conference Call and Earnings Release Information The Company will be conducting a conference call to discuss final earnings results for the fourth quarter and year-end on March 20, 2007, at 10:00 A.M. ET. To participate in the call, please dial (866) 624-3372 approximately five minutes prior to the start time. International callers may dial (706) 758-3874. A digital replay will be available the following day by dialing (800) 633-8284 or (402) 977-9140 with reservation number 21328889. The Company will issue its final results prior to the conference call. About A.D.A.M., Inc. A.D.A.M. (Nasdaq: ADAM) is a leading provider of health information services and benefits management solutions serving healthcare organizations, employers, insurance brokers, consumers, and educational institutions. With an industry-leading employee and human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. benefits management platform and one of the largest consumer health information libraries in the world, A.D.A.M. engages consumers to learn about their health and manage their benefit choices while reducing the costs of healthcare and benefits administration. For more information, visit www.adam.com or call 1-800-408-ADAM. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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