Continucare Corporation Reports Results for the Year-Ended June 30, 1999.MIAMI--(BUSINESS WIRE)--Oct. 14, 1999-- Continucare Corporation (AMEX AMEX See: American Stock Exchange : CNU CNU Christopher Newport University CNU Chungnam National University (Korea) CNU Congress for the New Urbanism CNU Chonnam National University (Korea) CNU Consiglio Nazionale degli Utenti ), a provider of outpatient outpatient /out·pa·tient/ (-pa-shent) a patient who comes to the hospital, clinic, or dispensary for diagnosis and/or treatment but does not occupy a bed. out·pa·tient n. healthcare through managed care arrangements and home healthcare services, yesterday reported that revenues increased to $182.5 million in fiscal 1999 from $65.6 million in fiscal 1998. Net loss for fiscal 1999 was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $50.5 million, or $3.49 per share, compared to net loss of $15.0 million, or $1.20 per share in fiscal 1998. Management noted that the fiscal 1999 loss includes $15.4 million related to the operations disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. of during fiscal 1999, $11.7 million related to write down of certain impaired See assistive technology. long lived assets disposed of during fiscal 1999 and $5.8 million related to depreciation and amortization expenses. In Fiscal 1999, the Company undertook a Business Rationalization rationalization, in psychology: see defense mechanism. Program 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. certain unprofitable operations and to close other underperforming subsidiary divisions and a Financial Restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). Program to attempt to strengthen its financial performance. In connection with the implementation of the Business Rationalization Program, the Company has sold or closed its outpatient rehabilitation rehabilitation: see physical therapy. , diagnostic imaging and specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. physician practice divisions. The rationalization of these divisions has resulted in a significant reduction of the Company's fee for service business and the related accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying generated thereby from $9.00 million in fiscal 1998 to $.30 million in 1999. In addition to its Business Rationalization and Financial Restructuring Programs, on September September: see month. 29, 1999, the Company announced that it reached an agreement in principle with the holders of its outstanding $41 million 8% Convertible Subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. Notes, to effectuate ef·fec·tu·ate tr.v. ef·fec·tu·at·ed, ef·fec·tu·at·ing, ef·fec·tu·ates To bring about; effect. [Medieval Latin effectu a consensual CONSENSUAL, civil law. This word is applied to designate one species of contract known in the civil laws; these contracts derive their name from the consent of the parties which is required in their formation, as they cannot exist without such consent. 2. restructuring. The Agreement is expressly conditioned upon the parties drafting and executing a formal Consent to Supplemental Indenture An agreement declaring the benefits and obligations of two or more parties, often applicable in the context of Bankruptcy and bond trading. The term indenture primarily describes secured contracts and has several applications in U.S. law. and Waiver The voluntary surrender of a known right; conduct supporting an inference that a particular right has been relinquished. The term waiver is used in many legal contexts. . The Waiver will not be fully effective unless, and until, it is consented to by Continucare's shareholders at a meeting to be held on or before December December: see month. 31, 1999. "The rationalization and restructuring programs which we have implemented over the last year have changed the net operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. from a negative $8.8 million in fiscal 1998 to a negative $1.4 million in fiscal 1999. Continucare is now poised to provide outpatient healthcare and home healthcare services to the public in the coming millennium millennium [Lat.,=1,000 years], the period of 1,000 years in which, according to some schools of Christian eschatology, Christ will reign again gloriously on earth. Belief in the millennium, based on Rev. 20, has recurred in Christianity since the earliest times. ," said Spencer Spencer, city (1990 pop. 11,066), seat of Clay co., NW Iowa, on the Little Sioux River; inc. 1880. The city lies in a fertile farm area. Beef is processed, and Spencer's manufactures include work clothes, machinery, prefabricated buildings, and metal products. J. Angel, Executive Vice President and 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. . Continucare Corporation, headquartered in Miami, Florida “Miami” redirects here. For the Native American tribe, see Miami tribe. Miami is a major city in southeastern Florida, in the United States. It is the county seat of Miami-Dade County. Miami is a gamma world city with an estimated population of 404,048. , is a holding company with subsidiaries engaged in the business of providing outpatient physician care and home healthcare services. Except for the historical matters contained herein, statements in this press release are 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. and are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Securities Litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. Reform Act of 1995. Investors are cautioned that 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. involve risks and uncertainties which may affect the company's business and prospects, and cause results to differ materially from those set forth in the forward-looking statements. In addition to the factors set forth elsewhere in this release, the economic, competitive, governmental, technological and other factors identified in Continucare's filings with the Securities and Exchange Commission could affect the forward-looking statements contained in this release. -0-
CONSOLIDATED BALANCE SHEETS
June 30,
ASSETS 1999 1998
-------------------------
-------------------------------------
Current assets
Cash and cash equivalents $ 3,185,077 $ 7,435,724
Accounts receivable,
net of allowance for
doubtful accounts of $5,752,000
and $2,071,000, respectively 302,166 9,009,462
Other receivables 266,057 1,091,744
Prepaid expenses and other
current assets 298,899 595,086
Income taxes receivable -- 1,800,000
-------------------------
Total current assets 4,052,199 19,932,016
Notes receivable, net of
allowance for doubtful
accounts of $7,051,000 and
$5,510,000, respectively -- 1,644,420
Equipment, furniture and
leasehold improvements, net 1,098,289 5,496,025
Cost in excess of net tangible
assets acquired, net of
accumulated amortization of
$3,837,000 and $2,252,000
respectively 22,346,156 38,621,561
Deferred financing costs,
net of accumulated amortization
of $1,203,000 and $400,000,
respectively 2,551,811 3,373,999
Other assets, net 69,165 418,084
============================
Total assets $ 30,117,620 $ 69,486,105
============================
LIABILITIES AND SHAREHOLDERS'
(DEFICIT) EQUITY
Current liabilities
Accounts payable $ 842,442 $ 816,844
Accrued expenses 2,358,346 2,593,493
Accrued salaries and benefits 1,856,140 2,629,660
Medical claims payable 4,825,081 966,251
Convertible subordinated
notes payable 45,000,000 --
Current portion of
long-term debt 6,857,946 850,000
Accrued interest payable 2,400,022 623,556
Current portion of capital
lease obligations 112,652 328,295
--------------------------
Total current liabilities 64,252,629 8,808,099
Deferred tax liability -- 954,894
Capital lease obligations,
less current portion 123,436 496,766
Convertible subordinated
notes payable -- 46,000,000
Long-term debt, less current
portion 1,396,753 --
--------------------------
Total liabilities 65,772,818 56,259,759
Commitments and contingencies
Shareholders' (deficit) equity
Common stock, $0.0001 par value:
100,000,000 shares authorized;
17,536,283 shares issued and
14,540,091 shares outstanding at
June 30, 1999; and 16,661,283 shares
issued and 13,731,283 shares
outstanding at June 30, 1998 1,455 1,374
Additional paid-in capital 32,910,465 31,099,303
Accumulated deficit (63,142,417) (12,631,651)
Treasury stock (2,996,192 shares
at June 30, 1999 and 2,930,000
shares at June 30, 1998) (5,424,701) (5,242,680)
--------------------------
Total shareholders' (deficit)
equity (35,655,198) 13,226,346
--------------------------
Total liabilities and
shareholders' (deficit)
equity $ 30,117,620 $ 69,486,105
==========================
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Year Ended June 30,
----------------------------
1999 1998
----------------------------
Revenue
Medical services, net $ 182,008,710 $ 63,088,911
Management fees 518,042 2,495,382
----------------------------
Subtotal 182,526,752 65,584,293
Expenses
Medical services 163,237,820 54,695,446
Payroll and employee benefits 13,797,555 5,714,653
Provision for bad debts 6,196,384 5,778,216
Professional fees 1,886,661 1,637,957
General and administrative 10,198,385 8,435,001
Write down of long-lived assets 11,717,073 --
Depreciation and amortization 5,791,982 3,247,717
----------------------------
Subtotal 212,825,860 79,508,990
----------------------------
(Loss) income from operations (30,299,108) (13,924,697)
Other income (expense)
Interest income 138,963 932,397
Interest expense (5,145,212) (3,007,331)
Loss on disposal of subsidiaries (15,361,292) --
Other 24,906 107,696
---------------------------
(Loss) income before income
taxes and extraordinary item (50,641,743) (15,891,935)
(Benefit) provision for income taxes -- (909,000)
---------------------------
(Loss) income before extraordinary
items (50,641,743) (14,982,935)
Extraordinary gain on extinguishment
of debt 130,977 --
---------------------------
Net (loss) income $ (50,510,766) $ (14,982,935)
===========================
Basic and diluted (loss)
earnings per common share:
(Loss) income before extraordinary
item $ (3.50) $ (1.20)
Extraordinary gain on extinguishment
of debt .01 --
---------------------------
Net (loss) income $ (3.49) $ (1.20)
===========================
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Year Ended June 30,
1999 1998
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income $(50,510,766) $(14,982,935)
Adjustments to reconcile net
(loss) income to cash used in
operating activities:
Depreciation and amortization,
including amortization of
deferred loan costs 6,705,221 3,648,581
Provision for bad debts 4,656,384 1,953,013
Write down of long-lived
assets 11,717,073 --
Loss on purchase of minority
interest -- --
Income applicable to minority
interest -- --
Provision for notes receivable 1,540,000 3,825,219
Loss on treasury stock
transaction -- 426,750
Loss on disposal of
subsidiaries 15,361,292 --
Amortization of discount on
notes payable 254,531 --
Gain on early extinguishment
of debt (130,977) --
Compensation expense on
exercise of warrants -- 212,500
Changes in assets and
liabilities, excluding the
effect of acquisitions and disposals:
Decrease (increase) in
accounts receivable 3,044,990 (3,615,007)
Decrease (increase) in
prepaid expenses and other
current assets 191,644 127,467
Decrease (increase) in
other receivables (221,092) (2,891,744)
Decrease in income tax
receivable 1,800,000 --
Increase in intangible
assets 75,674 --
Decrease (increase) in
other assets 24,141 (206,662)
Decrease (increase) in
deferred tax asset, net -- 505,699
(Decrease) increase in
accounts payable and
accrued expenses (1,516,093) 2,311,647
Increase in medical
claims payable 3,858,831 --
Increase in accrued
interest payable 1,776,466 586,261
(Decrease) increase in
income and other taxes
payable -- (693,709)
-------------------------
Net cash used in operating
activities (1,372,680) (8,792,920)
-------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Cash proceeds from disposal
of subsidiaries 5,642,216 --
Cash paid for acquisitions (4,640,000) (37,972,997)
Property and equipment
additions (751,708) (1,006,706)
-------------------------
Net cash provided by
(used in) investing activities 250,508 (38,979,703)
-------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Payments to redeem Convertible
Subordinated Notes $ (720,000) $ (2,000,000)
Issuance of common stock
to purchase minority interest -- --
Principal repayments under
capital lease obligation (247,619) (254,233)
Proceeds received from private
placement of common stock -- 10,575,000
Payments on acquisition notes (1,475,000) (892,500)
Costs incurred associated with
Convertible Subordinated Notes -- (3,000,000)
Proceeds from acceleration of
Series A Warrants -- --
Proceeds from Convertible
Subordinated Notes -- 46,000,000
Proceeds from Term and
Revolving Notes 5,000,000 2,500,000
Costs incurred associated
with Term and Revolving Notes (161,051) --
Proceeds from issuance of
common stock -- 889,500
Repayment of loan from
HCMP -- --
Repayment of Term and
Revolving Notes (3,935,745) (5,000,000)
Repayments to Medicare per
agreement (1,736,579) --
Costs incurred associated with
Private Placement and Merger -- --
Proceeds from note repayment 147,520 --
Repayment of shareholder note -- (599,000)
-------------------------
Net cash (used in) provided by
financing activities (3,128,474) 48,218,767
-------------------------
Net (decrease) increase in
cash and cash equivalents (4,250,647) 446,144
Cash and cash equivalents
at beginning of fiscal year 7,435,724 6,989,580
-------------------------
Cash and cash equivalents at
end of fiscal year $ 3,185,077 $ 7,435,724
SCHEDULE OF NONCASH INVESTING
AND FINANCING ACTIVITIES:
Cash paid for income taxes $ -- $ 1,528,445
=========================
Cash paid for interest $ 2,125,895 $ 2,021,070
=========================
Notes payable issued for
acquisitions $ 5,819,411 $ --
=========================
Receipt of stock in settlement
of receivable $ 182,028 $ --
=========================
Stock issued in ZAG agreement $ 1,811,250 $ --
=========================
Purchase of furniture and fixtures
with proceeds of capital lease
obligation $ -- $ --
=========================
|
|
Printer friendly
Cite/link
Email
Feedback
Reader Opinion