Counsel Corporation Announces 1997 Third Quarter Earnings.TORONTO--(BUSINESS WIRE)--Nov. 25, 1997--Counsel Corporation(TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :CXS CXS Coherent X-Ray Scattering .) (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 :CXSNF) Counsel Corporation today reported its financial results for the third quarter of 1997. Earnings from operations, before realization of value in operating businesses, increased to US$9.2 million from US$8.9 million in the three months ended September September: see month. 30, 1996. Earnings for the third quarter of 1996 included a gain on realization of value in operating businesses of US$12.3 million, due primarily to a dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. gain arising from the public offering of 10.35 million Capstone 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. shares, versus US$13,000 in the current quarter. During the third quarter of 1997, Counsel Corporation incurred a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge of US$18.0 million which resulted in a net loss for the 1997 third quarter of US$10.0 million compared with net earnings of US$12.2 million a year earlier, due to a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of US$67 million at our 27 percent owned home health care operation, American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of HomePatient. Basic and fully diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were (US$0.36) and (US$0.35), respectively, for the most recent quarter compared with US$0.49 and US$0.44, respectively, in the 1996 third quarter. Revenues during the third quarter increased to US$132.8 million from US$113.3 million in the year earlier period. Net earnings for the nine months ended September 30, 1997 were US$2.4 million or US$0.08 per share basic and fully 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. . This compares with net earnings of US$25.9 million or US$1.03 per share basic, US$0.95 fully diluted, for the same period in 1996. Revenues for the first nine months of 1997 were up 99 percent to US$441.7 million from US$222.4 in the comparable 1996 period. Excluding the American HomePatient restructuring charge, net earnings for the quarter and nine months ended September 30, 1997 were US$2.0 million and US$14.4 million, respectively. At the end of June June: see month. 1977, Counsel increased its ownership of its specialty pharmacy, Stadtlander Drug Co. to 99 percent from 64.4. During the third quarter, Stadtlanders continued to pursue its growth strategy of strengthening its platform in the disease states it services while entering into new strategically relevant disease states. The US$40 million acquisition of the assets and operations of Health Management, Inc., a specialty pharmacy provider to patients with chronic medical conditions See carpal tunnel syndrome, computer vision syndrome, dry eyes and deep vein thrombosis. was completed at the end of September. The acquired business had revenue run rate of US$140 to $150 million per annum Per annum Yearly. . This acquisition expanded Stadtlanders' transplant transplant or graft Partial or complete organ or other body part removed from one site and attached at another. It may come from the same or a different person or an animal. One from the same person—most often a skin graft—is not rejected. patient base by more than 7,000 to 14,000. The acquisition provided Stadtlanders with greater ability to serve managed care and 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. populations. It expands Stadtlanders' presence in oncology oncology /on·col·o·gy/ (ong-kol´ah-je) the sum of knowledge regarding tumors; the study of tumors. on·col·o·gy n. and infertility infertility, inability to conceive or carry a child to delivery. The term is usually limited to situations where the couple has had intercourse regularly for one year without using birth control. and provides a platform for entering a new disease state, mental health. Also at the end of September, Stadtlanders entered into a long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. agreement with The DuPont Dupont, DuPont, Du Pont, or du Pont may refer to: Companies
Stadtlanders' revenues and operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before for the third quarter of 1997 decreased by 20 percent and 36 percent, respectively, over the second quarter. This was due to three main factors: the expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created in May of Stadtlanders' primary distribution contract for the HIV HIV (Human Immunodeficiency Virus), either of two closely related retroviruses that invade T-helper lymphocytes and are responsible for AIDS. There are two types of HIV: HIV-1 and HIV-2. HIV-1 is responsible for the vast majority of AIDS in the United States. protease inhibitor protease inhibitor (prō`tē-ās'), any of a class of drugs that interfere with replication of the AIDS virus (HIV), by blocking an enzyme (protease) necessary in the late stages of its reproduction. , Crixivan Crixivan® Indinavir, see there , the UPS strike which negatively impacted both shipping and labour costs, and the maintenance of higher staffing. This higher personnel base was maintained in order to do due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. and properly prepare for the increased activity resulting from the integration of the Health Management operations to Stadtlanders' Pittsburgh Pittsburgh (pĭts`bərg), city (1990 pop. 369,879), seat of Allegheny co., SW Pa., at the confluence of the Allegheny and the Monongahela rivers, which there form the Ohio River; inc. 1816. fulfillment ful·fill also ful·fil tr.v. ful·filled, ful·fill·ing, ful·fills also ful·fils 1. To bring into actuality; effect: fulfilled their promises. 2. centre, as well as the DuPont Merck startup. Counsel's 27 percent-owned American HomePatient Inc. (NASDAQ-AHOM), one of the largest diversified diversified (di·verˑ·s providers of home health care services in the US increased net revenues 43 percent to a record high US$102.7 million in the third quarter of 1997 compared to US$72.0 million for the same period in 1996. Same store revenues grew as expected at nine percent in the third quarter compared to the prior year's quarter. In September, American HomePatient announced its plans to aggressively respond to the 30 percent reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. rate cuts for 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. home oxygen services included in the 1997 Balanced Budget Balanced budget A budget in which the income equals expenditure. See: budget. balanced budget A budget in which the expenditures incurred during a given period are matched by revenues. Act by fundamentally reshaping the company for long term growth and value creation. This 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). involves closing, consolidating or scaling back approximately 20 percent of the company's operating centres; closing or scaling back nine billing centres; and eliminating marginal products In economics, the marginal product or marginal physical product is the extra output produced by one more unit of an input (for instance, the difference in output when a firm's labour is increased from five to six units). and services at numerous locations. Consequently, American HomePatient recorded a pre-tax charge of US$67 million in the third quarter relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the restructuring plan, goodwill 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. and related charges.This resulted in a net loss for the quarter ended September 30, 1997 of US$40.2 million or (US$2.68) per share compared to US$4.3 million net earnings or US$0.29 per share for the third quarter of 1996. Excluding the non-recurring pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern charges of US$67 million, earnings per share were US$0.35 for the third quarter. Counsel's 18 percent-owned Capstone Pharmacy Services Inc. (NASDAQ:DOSE), a leading US independent institutional pharmacy services company, providing services to long term care and correctional facilities in the US, increased revenues for the third quarter of 1997 85 percent to US$81.6 million as compared to US$44.0 million for the same period last year. Net earnings for the third quarter, exclusive of expenses related to Capstone's merger with Pharmacy Corporation of America, were US$4.0 million or US$0.11 per share, compared to a loss of US$3.3 million or (US$0.17) per share for the same period last year. Capstone's weighted average number of shares outstanding increased to 37.3 million in 1997 from 19.4 million for the third quarter of 1996. The merger of Capstone Pharmacy Services, Inc. and Beverly Enterprises, Inc.'s Pharmacy Corp. of America was approved by shareholders creating PharMerica, Inc., the nation's largest manager of pharmacy services to nursing homes and hospitals. The transaction is expected to close on or about December 3,1997. Allan Silber, Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Counsel, said, "I am very pleased with the progress in each of our companies. We will continue to invest our efforts and resources to ensure their long term profitable growth." -0-
COUNSEL CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited) (in thousands of US$)
September 30 December 31
1997 1996
A S S E T S Current assets:
Cash and short term investments $ 27,933 $ 53,683
Amounts receivable 65,154 59,018
Income taxes recoverable 3,880 3,676
Mortgages and other advances 367 4,100
Other assets 16,425 10,717
Deferred income taxes 3,636 2,890
----------- ---------
117,395 134,084
----------- ---------
Mortgages and other advances 4,491 4,582
Long term care facilities 26,616 27,241
Other assets 56,669 22,125
Equity in affiliates (Note 1) 113,408 115,645
----------- ---------
201,184 169,593
----------- ---------
$ 318,579 $ 303,677
----------- ---------
----------- ---------
-0-
L I A B I L I T I E S & SHAREHOLDERS' EQUITY
Current liabilities
Bank indebtedness $ 49,250 $ --
Accounts payable and accrued charges 52,317 90,450
Deferred revenue 4,182 3,250
Mortgages and loans payable 3,186 6,511
----------- ---------
108,935 100,211
----------- ---------
Deferred revenue 3,609 5,686
Mortgages and loans payable 21,896 22,697
Other long term debt 50,720 50,659
Deferred income taxes 6,432 6,066
----------- ---------
82,657 85,108
----------- ---------
191,592 185,319
Minority interest 527 2,344
Shareholders' equity 126,460 116,014
----------- ---------
$ 318,579 $ 303,677
----------- ---------
----------- ---------
-0-
COUNSEL CORPORATION
CONSOLIDATED STATEMENT OF EARNINGS
(Unaudited) (in thousands of US$)
For The Three Months For The Nine Months
Ended September 30 Ended September 30
1997 1996 1997 1996
-------------------- --------------------
Revenues (Note 2) $132,770 $113,328 $441,681 $222,366
-------------------- --------------------
-------------------- --------------------
Earnings (Note 2)
From operating
businesses
Specialty retail
pharmacy $ 4,045 $ 4,532 $17,837 $ 4,532
Home health care 2,337 1,817 6,517 5,851
Institutional
pharmacy 1,238 705 3,213 1,500
Clinical laboratory 191 168 755 414
Long term care 219 65 661 672
Property management -- 224 49 278
Realization of value
in operating
businesses 13 12,294 4,762 36,306
Interest and other
income 1,210 1,434 5,624 2,737
-------------------- --------------------
Earnings before
undernoted expenses 9,253 21,239 39,418 52,290
Corporate 1,832 1,664 5,028 2,948
Interest 1,936 1,292 4,761 2,639
Amortization 1,443 1,078 3,672 1,918
Home health care
restructuring and
non-recurring
charges 17,983 -- 17,983 --
-------------------- --------------------
Earnings before
income taxes (13,941) 17,205 7,974 44,785
and minority interest
Income taxes (4,025) 4,083 2,677 17,834
Minority interest 45 938 2,919 1,005
-------------------- --------------------
Net earnings (loss) $ (9,961) $12,184 $ 2,378 $ 25,946
-------------------- --------------------
-------------------- --------------------
Earnings per common
share
Net earnings (loss) $ (9,961) $12,184 $ 2,378 $ 25,946
Dividends on special
shares -- -- -- (1,193)
Interest on equity
component of
debentures payable (44) -- (131) --
-------------------- --------------------
Net earnings (loss)
applicable to common
shares $(10,005)$ 12,184 $ 2,247 $ 24,753
-------------------- --------------------
-------------------- --------------------
Per common share
- basic $ (0.36)$ 0.49 $ 0.08 $ 1.03
- fully diluted $ (0.35)$ 0.44 $ 0.08 $ 0.95
Weighted average number
of common
shares outstanding 27,924 23,951 27,924 23,951
-------------------- --------------------
-------------------- --------------------
-0-
COUNSEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Nine months ended September
30, 1997 (Unaudited)
1. Accounting for investments
Consolidated subsidiaries
The consolidated financial statements include the accounts of Counsel
Corporation ("the Company") and all companies over which it has voting
control.
The Company's principal operating subsidiaries and its respective
voting interest in each subsidiary as at September 30, 1997 and 1996
are as follows:
1997 1996
Counsel Healthcare Assets Inc. 100 percent 100 percent
Stadtlander Drug Co. Inc. 99 percent 65.1 percent
U. S. Laboratory Corp. 50.1 percent 50.1 percent
Significantly influenced corporations
Corporations over which voting control does not exist but significant
influence is exercised are carried on the equity method. Amortization
of the difference between acquisition cost and the underlying fair
value of the net identifiable assets acquired at the date of
acquisition is included in amortization expense.
The principal operating affiliates over which the Company exerts
significant influence and its respective voting interest in each
affiliate as at September 30, 1997 and 1996 are as follows:
1997 1996
American HomePatient Inc. 26.8 percent 26.1 percent
Capstone Pharmacy Services Inc. 17.4 percent 19.6 percent
O&Y Properties Inc. -- 40.0 percent
COUNSEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Nine months ended September
30, 1997 (Unaudited) (in thousands of US$)
2. Revenues and earnings
Revenues are comprised of 100 percent of those revenues from entities
that are consolidated and the Company's proportionate share of
revenues from entities that are accounted for by the equity method.
Earnings are comprised of revenues less cost of goods or services sold
and related operating and general administrative costs for entities
that are consolidated and the Company's proportionate share of
earnings before income taxes from entities that are accounted for by
the 1994 equity method. Revenues and earnings are as follows:
------------------- Revenues -------------------
For The Three Months For The Nine Months
Ended September 30 Ended September 30
1997 1996 1997 1996
-------------------------------------------------
Specialty retail
pharmacy
Consolidated $79,153 $69,399 $282,609 $69,399
-------------------------------------------------
Home health care
Equity accounted 27,469 18,667 74,937 63,809
-------------------------------------------------
Institutional
pharmacy
Consolidated -- -- -- 5,029
Equity accounted 14,375 12,097 40,604 24,280
-------------------------------------------------
14,375 12,097 40,604 29,309
-------------------------------------------------
Clinical laboratory
Consolidated 2,890 2,859 8,950 4,799
-------------------------------------------------
Long term care
Consolidated 7,673 7,811 23,503 23,506
-------------------------------------------------
Property management
Equity accounted -- 1,061 1,096 3,916
-------------------------------------------------
Realization of
value in operating
businesses -- -- 4,358 24,891
Interest and other
income 1,210 1,434 5,624 2,737
-------------------------------------------------
$132,770 $113,328 $441,681 $222,366
-------------------------------------------------
-------------------------------------------------
--------------------- Earnings ------------------
For The Three Months For The Nine Months
Ended September 30 Ended September 30
1997 1996 1997 1996
-------------------------------------------------
Specialty retail
pharmacy
Consolidated $4,045 $4,532 $17,837 $4,532
-------------------------------------------------
Home health care
Equity accounted 2,337 1,817 6,517 5,851
-------------------------------------------------
Institutional pharmacy
Consolidated -- -- -- 486
Equity accounted 1,238 705 3,213 1,014
-------------------------------------------------
1,238 705 3,213 1,500
-------------------------------------------------
Clinical laboratory
Consolidated 191 168 755 414
-------------------------------------------------
Long term care
Consolidated 219 65 661 672
-------------------------------------------------
Property management
Equity accounted -- 224 49 278
-------------------------------------------------
Realization of value in
operating businesses 13 12,294 4,762 36,306
Interest and other
income 1,210 1,434 5,624 2,737
-------------------------------------------------
$9,253 $21,239 $39,418 $52,290
-------------------------------------------------
-------------------------------------------------
CONTACT: Counsel Corporation Morris Perlis, 416/ 866-3193 or Counsel Corporation Susan Feldman, 416/ 866-3187 or Counsel Corporation Stephen Weintraub, 416/ 866-3058 |
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