Continucare Reports Results the Second Quarter Fiscal 2001.Business Editors MIAMI--(BUSINESS WIRE)--Feb. 15, 2001 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 leader in the field of providing 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 services through managed care arrangements and home healthcare services in the Florida Florida, state, United States Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and market, today reported that revenues for the quarter ended December December: see month. 31, 2000 increased to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $29.9 million from approximately $28.8 million in the comparable quarter ended December 31, 1999. Revenue for the six months ended December 31, 2000 increased to approximately $59.6 million from approximately $57.9 million in the comparable quarter ended December 31, 1999. Loss from operations for the three months ended December 31, 2000 was ($3.3) million as compared to an operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of approximately $3.8 million in the same period of 1999. Operating profit for the three months ended December 31, 1999 before a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. contract revision (programming) revision - A release of a piece of software which is not a major release or a bugfix, but only introduces small changes or new features. of previously recorded medical claims liability of $3.1 million was $777,074. Loss from operations for the six months ended December 31, 2000 was ($4.9) million as compared to an operating profit of approximately $1.1 million in the same period of 1999. Loss from operations for the six months ended December 31, 1999 before a one-time contract revision of previously recorded medical claims liability of $3.1 million was ($1.9) million. Net loss for the three months ended December 31, 2000 was ($3.7) million or ($.11) per share on 33.2 million weighted average shares outstanding, as compared to net income of $2.7 million or $.19 per share on 14.7 million weighted average shares outstanding in the same period of 1999. Net loss for the three months ended December 31, 1999 before a one-time contract revision of previously recorded medical claims liability of $3.1 million was ($308,025) or ($.02) per share. Net loss for the six months ended December 31, 2000 was ($5.8) million or ($.17) per share on 33.2 million weighted average shares outstanding, as compared to net income of $3.1 million or $.21 per share on 14.6 million weighted average shares outstanding in the same period of 1999. Net loss for the three months ended December 31, 1999 before a one-time contract revision of previously recorded medical claims liability of $3.1 million and a gain on extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. of debt of $3.8 million was ($3.7) million or ($.26) per share. "The rapid increase in medical and pharmacy pharmacy, art of compounding and dispensing drugs and medication. The term is also applied to an establishment used for such purposes. Until modern times medication was prepared and dispensed by the physician himself. In the 18th cent. costs during calendar 2000, without a counterbalancing increase in premium revenue, has eroded e·rode v. e·rod·ed, e·rod·ing, e·rodes v.tr. 1. To wear (something) away by or as if by abrasion: Waves eroded the shore. 2. To eat into; corrode. our bottom line," 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, President and Chief Executive Officer of Continucare. "However, given the renewed re·new v. re·newed, re·new·ing, re·news v.tr. 1. To make new or as if new again; restore: renewed the antique chair. 2. focus of the federal government in 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. funding issues coupled with creative changes in benefit packages offered by our HMO HMO health maintenance organization. HMO n. A corporation that is financed by insurance premiums and has member physicians and professional staff who provide curative and preventive medicine within certain financial, partners, Continucare believes it should be able to reverse this negative trend." 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 that 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.
CONTINUCARE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS December 31, 2000 June 30, 2000
(Unaudited) (Note 1)
Current assets
Cash and cash equivalents $ 703,475 $ 2,535,540
Accounts receivable, net of
allowance for doubtful accounts
of $5,752,000 at December 31, 2000
and June 30, 2000 94,966 85,022
Other receivables 453,773 697,977
Prepaid expenses and other
current assets 146,353 368,431
------------ -----------
Total current assets 1,388,623 3,696,914
Equipment, furniture and leasehold
improvements, net 967,040 880,873
Cost in excess of net tangible
assets acquired, net of accumulated
amortization of approximately
$7,138,000 at December 31, 2000
and approximately $5,929,000 at
June 30, 2000 18,724,821 19,932,891
Deferred financing costs, net of
accumulated amortization of
approximately $1,086,000 at
December 31 and $426,000 at
June 30, 2000 2,304,375 2,964,375
Other assets, net 89,135 70,127
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Total assets $ 23,473,994 $ 27,545,180
------------ -----------
------------ -----------
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
Current liabilities
Accounts payable $ 773,704 $ 687,703
Accrued expenses 2,043,124 2,336,398
Accrued salaries and benefits 1,068,351 923,656
Medical claims payable 2,459,732 985,835
Due to Medicare 538,689 73,527
Current portion of convertible
subordinated notes payable 700,000 700,000
Current portion of long term debt 3,555,989 2,276,635
Accrued interest payable 10,166 6,044
Current portion of capital lease
obligations 165,188 115,685
------------ -----------
Total current liabilities 11,314,943 8,105,483
Capital lease obligations, less
current portion 178,171 103,682
Convertible subordinated notes
payable, less current portion 10,700,000 11,050,000
Long term debt, less current portion 3,769,760 5,023,244
------------ -----------
Total liabilities 25,962,874 24,282,409
Commitments and contingencies
Shareholders' (deficit) equity
Common stock; $0.0001 par value;
100,000,000 shares authorized,
36,236,282 shares issued (including
treasury shares) and 33,240,090
shares outstanding at both
December 31, 2000 and June 30,
2000 3,325 3,325
Additional paid-in capital 57,708,595 57,708,595
Accumulated deficit (54,776,099) (49,024,448)
Treasury stock (2,996,192 shares
at December 31, 2000 and
June 30, 2000) (5,424,701) (5,424,701)
------------ -----------
Total shareholders' equity (2,488,880) 3,262,771
------------ -----------
Total liabilities and
shareholders' equity $ 23,473,994 $ 27,545,180
------------ -----------
------------ -----------
CONTINUCARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended December 31,
2000 1999
Medical services revenue, net $ 29,923,561 $ 28,840,728
Expenses
Medical services:
Medical claims 24,842,256 19,496,753
Contractual revision of previously
recorded medical claims liability -- (3,053,853)
Other 4,348,772 4,576,810
Payroll and employee benefits 1,505,331 1,409,532
Professional fees 316,747 304,852
General and administrative 1,464,406 1,515,541
Depreciation and amortization 729,376 760,166
------------ -----------
Subtotal 33,206,888 25,009,801
(Loss) income from operations (3,283,327) 3,830,927
Other income (expense)
Interest income 10,542 5,991
Interest expense (435,087) (1,091,090)
------------ -----------
Net (loss) income $ (3,707,872) $ 2,745,828
------------ -----------
------------ -----------
Basic and diluted (loss) earnings
per common share:
Net (loss) income $ (.11) $ .19
------------ -----------
------------ -----------
Weighted average number of common
shares outstanding:
Basic and diluted 33,240,090 14,703,135
CONTINUCARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Six Months Ended December 31,
2000 1999
Medical services revenue, net $ 59,560,052 $ 57,923,221
Expenses
Medical services:
Medical claims 48,188,399 42,495,480
Contractual revision of previously
recorded medical claims liability -- (3,053,853)
Other 8,541,186 9,010,273
Payroll and employee benefits 2,907,691 3,279,091
Professional fees 594,606 458,220
General and administrative 2,819,493 3,024,386
Depreciation and amortization 1,452,135 1,567,700
------------ -----------
Subtotal 64,503,510 56,781,297
(Loss) income from operations (4,943,458) 1,141,924
Other income (expense)
Interest income 24,409 24,567
Interest expense (832,906) (2,162,235)
Other 304 280,000
------------ -----------
Loss before extraordinary item (5,751,651) (715,744)
Gain on extinguishment of debt -- 3,776,197
------------ -----------
Net (loss) income $ (5,751,651) $ 3,060,453
------------ -----------
------------ -----------
Basic and diluted (loss) earnings
per common share:
Loss before extraordinary
item $ (.17) $ (.05)
Extraordinary gain on
extinguishment of debt -- .26
------------ -----------
Net (loss) income $ (.17) $ .21
------------ -----------
------------ -----------
Weighted average number of common
shares outstanding:
Basic and diluted 33,240,090 14,620,525
CONTINUCARE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended December 31,
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income $ (5,751,651) $ 3,060,453
Adjustments to reconcile net
(loss) income to cash used in
operating activities:
Depreciation and amortization
including amortization
of deferred loan costs 2,062,485 2,180,954
Gain on extinguishment of debt -- (3,776,197)
Changes in operating assets and
liabilities, excluding the
effect of acquisitions and
disposals:
Decrease in accounts receivable 9,944 567,221
Decrease in prepaid expenses and
other current assets 222,078 72,408
Decrease (increase) in other
receivables 244,204 (93,141)
Increase in other assets (19,008) (15,274)
Increase (decrease) in medical
claims payable 1,473,897 (2,531,444)
Increase (decrease) in due to
(from) Medicare 835,784 (122,598)
Decrease in accounts payable
and accrued expenses (62,578) (635,263)
Increase in accrued interest
payable 4,122 1,639,923
------------ -----------
Net cash used in operating
activities (862,254) (121,973)
------------ -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposals of
property and equipment 1,500 --
Property and equipment additions (165,086) (81,804)
------------ -----------
Net cash used in investing activities (163,586) (81,804)
------------ -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on convertible
subordinated notes (350,000) (210,000)
Principal repayments under
capital lease obligation (42,629) (10,321)
Payments on long term debt (413,596) (1,145,629)
------------ -----------
Net cash used in financing activities (806,225) (1,365,950)
------------ -----------
Net decrease in cash and cash
equivalents (1,832,065) (1,569,727)
------------ -----------
Cash and cash equivalents at
beginning of period 2,535,540 3,185,077
------------ -----------
Cash and cash equivalents at end
of period $ 703,475 $ 1,615,350
------------ -----------
------------ -----------
SUPPLEMENTAL SCHEDULE OF NONCASH
INVESTING AND FINANCING ACTIVITIES:
Note payable issued for refunds due
to Medicare for overpayments $ 370,622 $ 637,556
------------ -----------
------------ -----------
Purchase of furniture and fixtures
with proceeds of capital lease
obligations $ 166,621 $ 102,948
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