American Dental Partners, Inc. Reports Third Quarter Financial Results.Business/Medical Writers WAKEFIELD Wakefield, estate, United States Wakefield, family estate of George Washington, on the Potomac River, E Va.; part of the George Washington Birthplace National Monument (see National Parks and Monuments, table). , Mass.--(BUSINESS WIRE)--Nov. 5, 2001 American Dental Partners, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ADPI ADPI Alpha Delta Pi Sorority ADPI American Dairy Products Institute ADPI Analog Devices (Philippines) Inc ADPI Australian Dance Performance Institute (Brisbane, QLD, Australia) ) reported financial results today for the quarter and nine-month period ended September 30, 2001. "Our financial performance during the most recently completed quarter was impacted by the tragic events of September 11, 2001, and certain of our affiliates continue to be effected by these events and the subsequent economic slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. ," said Gregory A. Serrao, Chief Executive Officer. "Despite these challenges, we continue to generate strong cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses ," added Mr. Serrao. Comparing the third quarter of 2001 with the same period in 2000: -- Net revenue was $36,405,000 as compared to $36,901,000. -- Earnings from operations were $2,485,000 as compared to $3,935,000. -- Net earnings were $791,000 as compared to $1,524,000. -- Diluted net earnings per share were $0.11 as compared to $0.21. -- Cash earnings per diluted share, calculated by adding back the after-tax impact of amortization of intangible assets, was $0.20 from $0.29. As previously announced, the Company made several operational and managerial changes during the first quarter and recorded $871,000 of non-recurring after-tax expenses. Comparing the nine months of 2001, excluding these non-recurring expenses, with the same period in 2000: -- Net revenue was $111,069,000 as compared to $106,258,000. -- Earnings from operations were $8,902,000 as compared to $11,251,000. -- Net earnings were $3,041,000 as compared to $4,651,000. -- 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. net earnings per share were $0.41 as compared to $0.64. -- Cash earnings per diluted share, calculated by adding back the after-tax impact of amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. , was $0.49 from $0.87. Patient revenue during the quarter was $51,635,000. Same market revenue growth was 9% for the quarter excluding the affiliates whose operations were disrupted dis·rupt tr.v. dis·rupt·ed, dis·rupt·ing, dis·rupts 1. To throw into confusion or disorder: Protesters disrupted the candidate's speech. 2. by the contract terminations Defense procurement: the cessation or cancellation, in whole or in part, of work under a prime contract or a subcontract thereunder for the convenience of, or at the option of, the government, or due to failure of the contractor to perform in accordance with the terms of the contract (default). . Including the affiliates being impacted by the contract terminations, same market revenue growth was 3%. "Our financial performance during the most recently completed quarter was impacted by the tragic events of September 11. Most of our affiliates experienced dramatically higher appointment cancellations and lower productivity levels during the days immediately following these events. Selected affiliates continue to be impacted by what appears to be regional economic slowdowns, and our Arizona Arizona (âr'əzō`nə), state in the southwestern United States. It is bordered by Utah (N), New Mexico (E), Mexico (S), and, across the Colorado R., Nevada and California (W). affiliate continues to be impacted by the previously announced payor payor (payer) n. The one who must make payment on a promissory note. contract terminations," said Mr. Serrao. "While a series of events have impacted our profitability this year, our affiliated dental groups have been able to maintain their focus on cash collections. Cash flow from operations during the quarter was $3.1 million, allowing us to reduce debt by more than $1 million during the quarter. For the nine months ended September 30, 2001, we generated nearly $8 million of cash flow from operations, which exceeds last year's level," added Mr. Serrao. "We have made numerous operating and financial changes during the year, including the previously announced promotions of Mike Vaughan to Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. and Breht Feigh to Chief Financial Officer. We have been working with both to make numerous changes to our National and Regional Resource Groups. These changes are allowing us to reinvest re·in·vest tr.v. re·in·vest·ed, re·in·vest·ing, re·in·vests To invest (capital or earnings) again, especially to invest (income from securities or funds) in additional shares. in certain areas of our business, such as staff training and financial and information systems, while at the same time reduce overall costs. Our relationships with and contributions to our affiliated dental groups remain strong. We are hopeful the benefit of these relationships and management changes will become evident as the impact of the economic and payor contract terminations become less significant," concluded Mr. Serrao. For further discussion of these events and a comprehensive review of the third quarter for the period ending September 30, 2001, the Company will host a conference call on Tuesday, November 6, 2001 at 10:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy , which will be broadcast live over 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 at www.amdpi.com. The call will be hosted by Gregory A. Serrao, Chairman, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . To access the webcast, participants should visit the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the website at least fifteen minutes prior to the start of the conference call to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. A replay of the webcast will be available at www.amdpi.com and www.streetevents.com approximately two hours after the call through 6:00 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. Friday, November 9, 2001. American Dental Partners, Inc. is one of the nation's leading business partners to group dental practices Noun 1. dental practice - the practice of dentistry practice - the exercise of a profession; "the practice of the law"; "I took over his practice when he retired" . Including these transactions, the Company is affiliated with 19 dental groups and operates 155 dental facilities with approximately 1,400 operatories located in 14 states. Note: Some of the information in this press release contains "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. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The words "believe," "expect," "anticipate," "project," and similar expressions, among others, identify forward-looking statements. Forward-looking statements speak only as of the date the statement was made. Such forward-looking statements are subject to uncertainties and other factors that could cause actual results to differ materially from those projected, anticipated or implied. Certain factors that might cause such a difference include, among others, the Company's risks associated with overall or regional economic conditions, contracts its affiliated dental groups have with third party payors and the impact of any terminations or potential terminations of such contracts, the cost of and access to capital, the tight labor markets labor market A place where labor is exchanged for wages; an LM is defined by geography, education and technical expertise, occupation, licensure or certification requirements, and job experience , the Company's acquisition and affiliation strategy, management of rapid growth, dependence upon affiliated dental groups, dependence upon service agreements and government regulation of the dental industry. Additional risks, uncertainties and other factors are set forth in the "Risk Factors" section of the Company's Registration Statement on Form S-4 (File No. 333-56941).
AMERICAN DENTAL PARTNERS, INC.
FINANCIAL HIGHLIGHTS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
Actual Pro Forma
2001 2000 2001 2001 2000
Net revenue $36,405 $36,901 $111,069 $111,069 $106,258
Operating expenses:
Salaries and benefits 17,611 17,422 52,938 52,938 50,598
Lab fees and dental
supplies 5,539 5,435 17,184 17,184 15,445
Office occupancy 4,248 3,806 12,319 12,319 10,741
Other operating expenses 2,978 2,795 9,094 8,916 8,241
General corporate expenses 1,370 1,402 4,475 4,183 4,087
Special charges, exit costs -- -- 1,004 -- --
Depreciation 1,259 1,243 3,889 3,889 3,435
Amortization of
intangibles assets 915 863 2,738 2,738 2,460
Total operating
expenses 33,920 32,966 103,641 102,167 95,007
Earnings from operations 2,485 3,935 7,428 8,902 11,251
Interest expense, net 1,042 1,245 3,470 3,470 3,041
Earnings before income taxes 1,443 2,690 3,958 5,432 8,210
Income taxes 652 1,166 1,789 2,391 3,559
Net earnings $791 $1,524 $2,169 $3,041 $4,651
Net earnings per
common share:
Basic $0.11 $0.21 $0.30 $0.42 $0.65
Diluted $0.11 $0.21 $0.30 $0.41 $0.64
Weighted average
common shares outstanding:
Basic 7,162 7,122 7,186 7,186 7,116
Diluted 7,304 7,325 7,351 7,351 7,316
AMERICAN DENTAL PARTNERS, INC.
FINANCIAL HIGHLIGHTS
(in thousands)
September 30, December 31,
2001 2000
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 1,463 $ 472
Receivables due from affiliated
dental groups 19,097 17,331
Other current assets 4,964 4,675
Total current assets 25,524 22,478
Property and equipment, net 29,680 27,840
Non-current assets:
Intangible assets, net 79,322 81,083
Other assets 1,010 1,182
Total non-current assets 80,332 82,265
Total assets $135,536 $132,583
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 16,913 $ 16,822
Current maturities of debt 1,603 1,593
Total current liabilities 18,516 18,415
Non-current liabilities:
Long-term debt 56,101 55,330
Other liabilities 264 352
Total non-current liabilities 56,365 55,682
Total liabilities 74,881 74,097
Stockholders' equity 60,655 58,486
Commitments and contingencies
Total liabilities and
stockholders' equity $135,536 $132,583
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