HEALTH RISK MANAGEMENT, INC. REPORTS FIRST QUARTER
HEALTH RISK MANAGEMENT, INC. REPORTS FIRST QUARTER MINNEAPOLIS, Nov. 6 /PRNewswire/ -- Health Risk Management, Inc.
(HRM) (NASDAQ: HRMI), today reported revenues of $5,282,000 for its fiscal first quarter ended Sept. 30, 1991, an 8 percent increase over revenues of $4,905,000 in the prior year's first quarter. As anticipated, net income for the quarter declined to $255,000 from $295,000 in the comparable period a year ago. Earnings per share for the first quarter were $.07, down from $.12 per share in the same quarter last year.
The company reported that its gross profit increased 10 percent to $2,099,000 from $1,913,000 in the fiscal year's first quarter versus the same period last year, because of revenue growth and lower cost of services as a percentage of revenue. It said the net income decline was consistent with its previously announced strategy to expand sales and marketing activity. Gary T. McIlroy, M.D., HRM chairman and chief executive officer, said, "During the last three quarters, we deliberately have been spending more on sales and marketing in order to increase market share for HRM's enhanced managed health care programs and our rapidly growing preferred provider network, which now covers 42 states. As we said previously, we expected this to affect net income comparisons in the first and second quarters of this fiscal year, with revenue improvements resulting from the strategy beginning to appear in subsequent quarters." The company estimates that contracts and commitments to add services made since its fiscal year-end earnings announcement in late August will cover 550,000 members and dependents for various HRM services, and will generate an estimated $2,400,000 in annual revenue. New clients include the Arkansas River Valley Business Coalition, Centennial Life Insurance Company, Coca-Cola Bottling Company Consolidated, Country Life Insurance Company, Indiana State District Council of laborers and Hod Carriers Welfare Fund, and national Employee Benefits Fund. Existing clients who have committed recently to add services include Sunstrand Corporation, Tyco Laboratories, Woolworth Corporation and United Technologies Corporation. According to McIlroy, "Our estimates of additions to the number of lives covered and annual revenues do not include any growth estimates for several new insurance company clients, who will add policy holders monthly to HRM services. We also expect to announce additional new clients in the remainder of 1991 as commitments are finalized." Headquartered in Minneapolis, Health Risk Management, Inc. provides a broad range of integrated managed health care services to self-insured employers, unions, governmental entities and insurance company clients. HEALTH RISK MANAGEMENT, INC. CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) (In thousands, except share data) Percent Three Months Ended Increase 9/30/91 9/30/90 (Decrease) Revenues: Care review, case management, and price control services $4,729 $4,111 -- Claims administration services 438 443 -- Information management and consulting services 115 351 -- Total revenues 5,282 4,905 8 Operating expenses: Cost of services 3,183 2,992 -- Depreciation and amortization, principally cost of services 521 486 -- Selling and marketing 836 496 -- Administration 597 530 -- Total operating expenses 5,137 4,504 14 Operating income 145 401 (64) Other income (expense): Interest income 178 -- -- Interest expense (66) (99) -- Total other income (expense) 112 (99) -- Income before income taxes 257 302 -- Provision for income taxes 2 7 -- Net income $255 $295 (14) Net income per common and common equivalent share $.07 $.12 (42) Weighted average common and common equivalent shares 3,890,119 2,054,161 -- BALANCE SHEET INFORMATION 9/30/91 6/30/91 Assets Cash and cash equivalents $12,232 $13,428 Other current assets 3,194 2,736 Fixed assets, deferred contract costs and software, net 8,419 7,629 Other assets 292 275 Total assets $24,137 $24,068 Liabilities and shareholders' equity Current liabilities $3,682 $3,746 Other liabilities 1,157 1,284 Shareholders' equity 19,298 19,038 Total liabilities and shareholders' equity $24,137 $24,068 -0- 11/06/91 /CONTACT: Nancy Hurd of HRM, 612-829-3749/ CO: Health Risk Management, Inc. ST: Minnesota IN: INS SU: ERN JS-KH -- MN013 -- 1871 11/06/91 16:21 EST
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|Date:||Nov 6, 1991|
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