Coastal Physician Group Inc. Announces Second Quarter 1997 Financial Results.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)--Aug. 22, 1997--Coastal Physician Group, Inc. (NYSE NYSE See: New York Stock Exchange : DR) today reported financial results for the second quarter and six-month period ended June June: see month. 30, 1997. Total 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 second quarter of 1997 was $111,496,000, a 23.7 percent decrease from net operating revenue of $146,038,000 for the same period in 1996. The decrease in operating revenue was primarily due to attrition Attrition The reduction in staff and employees in a company through normal means, such as retirement and resignation. This is natural in any business and industry. Notes: in hospital-based contracts and sales of clinic operations in Maryland Maryland (mâr`ələnd), one of the Middle Atlantic states of the United States. It is bounded by Delaware and the Atlantic Ocean (E), the District of Columbia (S), Virginia and West Virginia (S, W), and Pennsylvania (N). and the Northeast “Northeastern” redirects here. For the Boston college, see Northeastern University, Boston. Northeast or north east is the ordinal direction halfway between north and east. It is the opposite of southwest. See boxing the compass. and the Company's North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. Preferred Provider Organization pre·ferred provider organization n. Abbr. PPO A medical insurance plan in which members receive more coverage if they choose health care providers approved by or affiliated with the plan. , all of which were completed during the second half of 1996. The Company reported a net loss for the second quarter of $21,627,000, or $0.89 per share, compared with a net loss of $24,860,000, or $1.04 per share, in the second quarter of 1996. The Company added that its loss for the 1997 quarter included a loss of $5,915,000 attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to its New York-based health plan including a write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. of goodwill of $4,200,000. The Company had previously announced the sale of certain assets of Better Health Plan, Inc., which was completed on August 19, 1997. Also, contributing to the net loss were $4,662,000 of expenses related to the repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $82,000,000 of bank debt on June 10, 1997. Those expenses included $2,100,000 related to vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: of previously-issued common stock warrants and approximately $1,500,000 of additional interest and professional fees for the bank group's advisors. For the six-month period ended June 30, 1997, total net operating revenue decreased 20.9 percent to $236,210,000 from $298,772,000 for the same period in the prior year. The sale of three business units during the second half of 1996 and less new business development throughout 1996 and the first half of 1997 in the hospital-based contract services subsidiary, as well as lower net collections per patient visit experienced by the Company's billing and collection services subsidiary, were the primary factors contributing to the decline in revenue. The Company reported a net loss for the six-month period ended June 30, 1997 of $33,193,000, or $1.37 per share, compared with a net loss of $36,590,000 or $1.54 per share, for the same period in the prior year. Steven Ste´ven 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., President and Chief Executive Officer stated, "We are disappointed with the bottom line; however, excluding the additional one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. expenses related to our bank debt and the loss at Better Health Plan, the second quarter's results were about the same as the first quarter of this year and improved slightly over the same quarter last year. We were extremely busy during the second quarter with our refinancing Refinancing An extension and/or increase in amount of existing debt. , but have devoted more management attention to the Company's operations and execution of its strategic plan since then." The Company's strategic business plan provides for ongoing reviews of the non-core businesses, improving the profitability of its core businesses, improving revenue and cutting overhead costs overhead costs see fixed costs. . The Company has taken the following actions 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 that plan. As a result of the reviews of its business units, the Company completed the sale of Better Health Plan, Inc. on August 19, 1997. Also, the Company successfully migrated its information technology hardware operations to a lower cost vendor providing additional savings throughout 1997 and future years. Our largest business, Coastal Physician Services, Inc. (CPS (1) (Characters Per Second) The measurement of the speed of a serial printer or the speed of a data transfer between hardware devices or over a communications channel. CPS is equivalent to bytes per second. ), is implementing physician educational programs to increase billings through better documentation of procedures performed in emergency departments. Using its Corporate Compliance Program as a pattern, Healthcare Business Resources, Inc. is inservicing CPS' employees and independent contractor A person who contracts to do work for another person according to his or her own processes and methods; the contractor is not subject to another's control except for what is specified in a mutually binding agreement for a specific job. physicians on compliance with Medicare Medicare, national health insurance program in the United States for persons aged 65 and over and the disabled. It was established in 1965 with passage of the Social Security Amendments and is now run by the Centers for Medicare and Medicaid Services. , Medicaid Medicaid, national health insurance program in the United States for low-income persons; established in 1965 with passage of the Social Security Amendments and now run by the Centers for Medicare and Medicaid Services. and CHAMPUS CHAMPUS Civilian Health & Medical Program for Uniformed Services A health care plan for military dependents and retirees operated by the DoD Types of service HMO, PPO, and fee-for-service, through a single health plan known as TriCare laws and regulations to ensure accurate billings for CPS' services. Also, a physician partnering program is being implemented which more closely ties revenue with physician compensation. These programs are expected to improve CPS' operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: . CPS is devoting significant management resources to contract retention efforts and margin improvement on less profitable contracts. Management has also completed a reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. of the corporate headquarters resulting in headcount head count or head·count n. 1. The act of counting people in a particular group. 2. The number of people counted in this way. Noun 1. reductions and lower consulting fees. Although these actions are expected to have a positive effect on the Company's financial performance, there are no assurances that these actions will be successful or that improved financial results will be achieved without additional asset sales, revenue and margin improvements and cost reductions. Coastal Physician Group, Inc. is a diversified diversified (di·verˑ·s physician management company providing a broad range of health care and administrative services to physicians, hospitals, employers, managed care programs and other health care providers. -0- Note: This news release contains statements that are forward- looking in nature, and are inherently subject to uncertainties. Actual results 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. due to a number of uncertainties and other important risk factors described in the Company's reports filed with the Securities and Exchange Commission. -0-
COASTAL PHYSICIAN GROUP, INC.
Consolidated Balance Sheets
(In thousands, except per share data)
June 30, December 31,
1997 1996
========================================
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 16,913 $ 10,239
Marketable securities 6,651 7,020
Trade accounts receivable, net 32,580 87,410
Accounts receivable, other 15,011 11,187
Refundable income taxes -- 2,498
Prepaid expenses
and other current assets 10,926 10,923
-------- --------
Total current assets 82,081 129,277
-------- --------
Property and equipment,
at cost, less accumulated
depreciation 15,324 19,041
Excess of cost over fair
value of net assets
acquired, net 14,734 19,305
Other assets 13,605 14,218
-------- --------
Total assets $125,744 $181,841
======== ========
Liabilities and Shareholders' Equity (Deficit)
Current liabilities:
Current maturities and other
short-term borrowings $ 2,452 $ 71,130
Accounts payable 36,436 46,307
Deferred revenue 50,224 --
Income taxes payable 4,296 2,211
Accrued physician fees
and medical costs 23,755 33,709
Accrued expenses 18,592 20,182
-------- --------
Total current liabilities 135,755 173,539
-------- --------
Long-term debt, excluding
current maturities 3,904 4,799
-------- --------
Total liabilities 139,659 178,338
-------- --------
Shareholders' equity (deficit):
Preferred stock $.01 par value;
shares authorized 10,000; issued
and outstanding 1,164 and 0, respectively
Series A convertible preferred stock
shares authorized 48; shares issued
and outstanding 46 and 0, respectively 1 -
Series B convertible preferred stock
shares authorized 33; shares issued
and outstanding 33 and 0, respectively - -
Series C convertible preferred
stock shares authorized 1,200;
shares issued and outstanding
1,085 and 0, respectively 11 -
Common stock $.01 par value;
shares authorized 100,000;
shares issued and outstanding
24,384 and 24,126,
respectively 244 241
Additional paid-in capital 158,063 144,070
Common stock warrants 2,828 987
Retained earnings
(accumulated deficit) (175,124) (141,931)
Unrealized appreciation
of available-for-sale securities 62 136
--------- ---------
Total shareholders'
equity (deficit) (13,915) 3,503
--------- ---------
Total liabilities and
shareholders' equity
(deficit) $ 125,744 $ 181,841
========= =========
See accompanying notes to consolidated financial statements.
-0-
COASTAL PHYSICIAN GROUP, INC.
Unaudited Consolidated Condensed Statements of Cash Flows
(In thousands)
Six months ended
June 30,
=============================
1997 1996
-----------------------------
Net cash provided by (used in)
operating activities $ 13,793 $(27,417)
-------- --------
Cash flows from
investing activities:
Sales of marketable
securities and investments, net 234 5,660
Sales (purchases)
of property and equipment, net (37) 4,208
Disposition of subsidiaries,
net of cash disposed 1,402 (82)
-------- --------
Net cash provided by
(used in) investing activities 1,599 9,786
-------- --------
Cash flows from financing activities:
Repayments of long-term debt (91,321) (8,786)
Borrowings on long-term debt 22,101 30,704
Deferred revenue 50,224 --
Cash payments for debt issue costs -- (1,558)
Proceeds from issuances
of preferred stock 10,000 --
Proceeds from issuances
of common stock 278 579
-------- --------
Net cash provided
by financing activities (8,718) 20,939
-------- --------
Net increase in cash
and cash equivalents 6,674 3,308
Cash and cash equivalents
at beginning of period 10,239 8,147
-------- --------
Cash and cash equivalents
at end of period $ 16,913 $ 11,455
======== ========
Supplemental disclosures
of cash flow information:
Cash payments (refunds)
during the period for:
Interest $ 4,631 $ 4,586
Income taxes $ (4,581) $(12,993)
See accompanying notes to consolidated financial statements.
-0-
COASTAL PHYSICIAN GROUP, INC.
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
======================================
======================================
1997 1996 1997 1996
--------------------------------------
Operating revenue, net $ 111,496 $ 146,038 $ 236,210 $ 298,772
Costs and expenses:
Physician and other
provider services 88,277 114,127 182,921 227,692
Medical support
services 10,813 23,094 24,154 47,271
Selling, general
and administrative 28,421 30,615 53,450 55,388
--------- --------- --------- ---------
Total costs and expenses 127,511 167,836 260,525 330,351
--------- --------- --------- ---------
Operating loss (16,015) (21,798) (24,315) (31,579)
--------- --------- --------- ---------
Other income (expense):
Interest expense (5,911) (2,724) (9,754) (4,955)
Interest income 136 77 462 202
Other, net 163 (415) 414 (258)
--------- --------- --------- ---------
Total other expense (5,612) (3,062) (8,878) (5,011)
--------- --------- --------- ---------
Loss before income taxes (21,627) (24,860) (33,193) (36,590)
Benefit for income taxes -- -- -- --
--------- --------- --------- ---------
Net loss $ (21,627)$ (24,860)$ (33,193)$ (36,590)
========= ========= ========= =========
Net loss per share $ (0.89)$ (1.04)$ (1.37)$ (1.54)
========= ========= ========= =========
Weighted average
number of shares
outstanding 24,385 23,839 24,258 23,815
========= ========= ========= =========
See accompanying notes to consolidated financial statements.
CONTACT: Coastal Physician Group Inc., Durham 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, 919/383-0355 |
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