Coastal Physician Group, Inc. Announces Third Quarter Results -- Core Operations Returning To Profitability.DURHAM Durham, town and district, England Durham, town (1991 pop. 38,105) and district, county seat of Durham, NE England, on the sides of a hill nearly encircled by the Wear River. The town's small factories produce organs and carpets. , N.C.--(BUSINESS WIRE)--Nov. 17, 1998--Coastal Physician Group, Inc. (NYSE NYSE See: New York Stock Exchange : DR) today reported financial results for the third quarter and nine-month period ended September September: see month. 30, 1998. Net operating revenue operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. for the third quarter of 1998 was $79,392,000 versus $99,595,000 in the same period in 1997, a decrease of $20,203,000. The net loss for the third quarter of 1998 was $2,445,000, or $0.06 per share, a decrease of $13,124,000 from the net loss of $15,569,000, or $0.64 per share, in the third quarter of 1997. For the nine months ended September 30, 1998, net operating revenue was $245,961,000 compared to $335,805,000 for the same period in 1997, or a decline of $89,844,000. The net loss for the nine months ended September 30, 1998 was $13,153,000, or $0.35 per share, a decrease of $35,609,000 from the net loss of $48,762,000, or $2.01 per share, for the same period in 1997. The Company also announced that it completed the sale of Health Enterprises, Inc. ("HEI HEI Higher Education Institution (UK) HEI Health Effects Institute HEI Hautes Études Internationales HEI House Ear Institute HEI Healthy Eating Index HEI Hautes Etudes d'Ingénieur HEI High-Explosive Incendiary "), whose primary operating subsidiary An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. is Healthplan Southeast Southeast or south east is the ordinal direction halfway between south and east. It the opposite of northwest. Southeast or South East can refer to: n. 1. Voice; speech; language. Ye have as merry a steven As any angel hath that is in heaven. - Chaucer. 2. An outcry; a loud call; a clamor. To set steven to make an appointment. M. Scott, M.D., Chairman and Chief Executive Officer of the Company. Healthplan Southeast is a commercial Health Maintenance Organization located in Tallahassee, Florida For other uses, see Tallahassee (disambiguation). Tallahassee is the capital of the State of Florida and the county seat of Leon County. Tallahassee became the capital of Florida in 1824. As of 2006, the population recorded by the U.S. . Effective October October: see month. 1, 1998, Dr. Scott acquired all of the outstanding stock of HEI for $15 million and agreed to provide $6 million of additional capital to HPSE. The $15 million was used by the Company to decrease debt. The decline in revenues for the three months and nine months ended September 30, 1998, were primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the sale of certain assets since the beginning of 1997. Divested businesses accounted for $21,166,000 of the third quarter decrease in revenues from the same quarter of last year. This decrease was partially offset by an increase in the net revenue of the other businesses, including HPSE, of $963,000. Divested businesses accounted for approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $65,098,000 of the decrease in the first nine months of 1998 as compared to the same period of the prior year. Net revenue of the other businesses, including HPSE, also declined by $24,746,000 during 1998 as compared to 1997. HPSE's revenues and net losses included in the Company's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: results of operations in the third quarter were approximately $27,235,000 and $2,586,000, respectively, for the three months ended September 30, 1998. HPSE's revenues and net losses included in the Company's consolidated results of operations were approximately $82,815,000 and $5,101,000, respectively, for the nine months ended September 30, 1998. Excluding HPSE's losses, the Company's other operations reported a profit of $141,000 for the third quarter of 1998. Additionally, Coastal was able to negotiate certain incentives with National Century Financial Enterprises (NCFE NCFE National Campaign for Freedom of Expression NCFE National Center for Financial Education (now Institute of Consumer Financial Education) NCFE Northern Council for Further Education NCFE National Century Financial Enterprises, Inc. ) to lower its capital costs in the third quarter. "National Century has been particularly helpful with the Coastal turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. and provided significant assistance during the last 18 months," stated W. Randall Randall may refer to the following: In places:
American football player. A running back, mainly for the Los Angeles Rams (1983-1986) and the Indianapolis Colts (1987-1992), he led the National Football League in rushing 4 times and gained over 13,000 yards , Chief Financial Officer. "Our management plan has three critical components: to improve our core Emergency Physician Management and Billing operations, to divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. assets not related to our core operations, and to negotiate a reduction in capital costs. With the sale of Healthplan Southeast, Coastal has now completed one of these key components and made substantial progress on the others," stated Steven M. Scott, M.D., Chairman and Chief Executive Officer. "The Company's remaining core operations reported positive results of about $141,000 for the quarter, and we are very encouraged by the continuing improvement in our principal businesses. We are also excited about the new business prospects in this area. In the last month, we have been awarded contracts with more than $8 million of new annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. revenue and have opportunities for an additional $15 million. We have greatly appreciated the support and encouragement of our client hospitals, physician partners, employees and shareholders. We look forward to our opportunities in 1999 to enhance shareholder value." A copy of the Coastal Physician Group, Inc. Form 10-Q Form 10-Q See 10-Q. for the period ended September 30, 1998 as filed with the Securities and Exchange Commission is available by contacting the Company's Investor Relations Investor relations The process by which the corporation communicates with its investors. Department. Coastal Physician Group, Inc. is an Emergency Medicine Physician Management company and provides certain core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
Forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. Information or Statements: Except for statements of historical fact, statements made herein are forward-looking in nature and are inherently subject to uncertainties. The actual results of the Company may differ materially from those reflected in the 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. based on a number of important risk factors, including, but not limited to: the timing of any divestitures; the level and timing of improvements in the operations of the Company's core businesses; the possibility that the Company may not be able to improve operations or execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution its strategy as planned; and other important factors discussed above under "Other Trends and Uncertainties" and disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). from time to time in the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , Form 10-Q and other Securities and Exchange Commission filings. -0-
COASTAL PHYSICIAN GROUP, INC.
Consolidated Balance Sheets
(In thousands, except per share data)
September December
30, 31,
1998 1997
Assets (unaudited)
Current assets:
Cash and cash equivalents 7,453 8,921
Marketable securities 2,028 5,735
Trade accounts receivable, net 16,925 23,612
Reserves held by NCFE 6,953 6,396
Accounts receivable, other 5,453 12,684
Receivables from related party 6,169 9,405
Prepaid expenses and other current 6,988 7,923
assets
Total current assets 51,969 74,676
Property and equipment, at cost, less
accumulated depreciation 8,879 10,342
Excess of cost over fair value of net
assets acquired, net 2,314 2,450
Other assets 8,230 8,628
Total assets 71,392 96,096
Liabilities and Shareholders' Equity (Deficit)
Current liabilities:
Current maturities and other short-term
borrowings 16,793 2,529
Accounts payable 19,107 31,364
Income taxes payable 1,147 1,359
Accrued physicians fees and medical
costs 18,261 31,431
Accrued expenses 10,659 16,142
Total current liabilities 65,967 82,825
Long-term debt, excluding current
maturities 74,695 74,698
Total liabilities 140,662 157,523
Deferred credit on business transferred
net of
note receivable 2,794 --
Shareholders' equity deficit:
Preferred stock $.01 par value; shares
authorized 10,000; shares issued and
outstanding 445 and 0, respectively -- --
Series D convertible preferred
stock shares authorized
1,200; shares issued and
outstanding 445 and 0 respectively 4 --
Common stock $.01 par value; shares
authorized 100,000; shares issued and
outstanding 37,700 and 37,493, respectively 377 375
Additional paid-in capital 162,811 160,374
Common stock warrants 1,582 1,582
Retained earnings (accumulated deficit) (237,065) (223,912)
Accumulated comprehensive income 227 154
Total shareholders' equity (deficit) (72,064) (61,427)
Total liabilities and shareholders' equity
(deficit) 71,392 96,096
COASTAL PHYSICIAN GROUP, INC.
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
Three months ended
September 30,
1998 1997
Operating revenue, net $79,392 $99,595
Costs and expenses:
Physician and other provider services 63,359 84,903
Medical support services 8,520 8,894
Selling, general and administrative 7,860 19,392
Total costs and expenses 79,739 113,189
Operating loss (347) (13,594)
Other income (expense):
Interest expense (2,708) (2,837)
Interest income 618 83
Other, net (8) (621)
Total other income (expense) (2,098) (3,375)
Loss before income taxes (2,445) (16,969)
Benefit for income taxes --- (1,400)
Net loss (2,445) (15,569)
Basic and diluted loss per share (0.06) (0.64)
Weighted average number of shares
outstanding 37,700 24,415
COASTAL PHYSICIAN GROUP, INC.
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
Nine months ended
September 30,
1998 1997
Operating revenue, net 245,961 335,805
Costs and expenses:
Physician and other provider services 196,994 267,824
Medical support services 24,892 33,048
Selling, general and administrative 30,549 72,842
Total costs and expenses 252,435 373,714
Operating loss (6,474) (37,909)
Other income (expense):
Interest expense (7,662) (12,591)
Interest income 854 545
Other, net 129 (207)
Total other (income) expense (6,679) (12,253)
Loss before income taxes (13,153) (50,162)
Benefit for income taxes -- (1,400)
Net loss (13,153) (48,762)
Basic and diluted loss per share (0.35) (2.01)
Weighted average number of shares
outstanding 37,637 24,311
COASTAL PHYSICIAN GROUP, INC.
Unaudited Consolidated Condensed Statements of Cash Flows
(In thousands)
Nine months ended
September 30,
1998 1997
Net cash (used in)
operating activities (12,154) (2,862)
Cash flows from investing activities:
Sales (purchases) of marketable securities
and investments, net 930 (816)
Sales (purchases) of property and
equipment, net (991) 456
Disposition of subsidiaries, net of
cash disposed (5,957) 4,890
Net cash (used in) (6,018) 4,530
provided by investing activities
Cash flows from financing activities:
Repayments of long-term debt (4,037) (92,086)
Borrowings on long-term debt 18,298 75,585
Deferred revenue - -
Cash payments for debt issue costs - -
Proceeds from issuance of preferred 2,065 10,000
stock
Proceeds from issuance of common 378 311
stock
Net cash provided by (used in) 16,704 (6,190)
financing activities
Net decrease in
cash and cash equivalents (1,468) (4,522)
Cash and cash equivalents at beginning
of period 8,921 10,239
Cash and cash equivalents at end of
period $7,453 $5,717
Supplemental disclosures of cash flow
information:
Cash payments (refunds) during
the period for:
Interest $7,655 $8,436
Income taxes $212 $(4,401)
See accompanying notes to consolidated financial statements.
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