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IN HOME HEALTH REVENUE TOPS $100 MILLION FOR FIRST TIME; REPORTS FISCAL 1993 RESULTS FOR YEAR AND FOURTH QUARTER

 MINNETONKA, Minn., Nov. 29 /PRNewswire/ -- In Home Health, Inc. (NASDAQ-NMS: IHHI) reported revenue of $103.8 million for its fiscal year ended Sept. 30, 1993, up from $75.1 million for fiscal 1992, it was announced toady by Judy M. Figge, president and chief executive officer of the home health care company. Net income for fiscal 1993, was $1 million, or $.06 per share, as compared with $2.3 million, or $.15 per share, reported in fiscal 1992.
 "As previously announced, during the fourth quarter we established a reserve of $700,000, net of tax effect, to cover a dispute with Medicare intermediaries concerning reimbursement of certain sales costs incurred over the last five years. We also took a charge of $100,000 (which includes $72,000 in prior years) to reflect the adoption of SFAS No. 109 concerning accounting for income taxes," Ms. Figge said. "We remain confident that the costs are allowed under Medicare regulations and consistent with industry practice and therefore reimbursable."
 "In addition to special charges, a number of factors contributed to reduced net income for fiscal 1993, including six branches exceeding the cost ceilings during their first year of operation after being acquired; less profit derived from infusion products and services; higher general, administrative and selling expenses due to development and implementation of the new computer software and an increase in interest expense," the CEO said.
 "Fiscal 1993 profitability was adversely affected by costs exceeding the Medicare reimbursement ceilings by a cumulative amount of nearly $1 million in six of the newer markets acquired during late fiscal year 1992 and 1993."
 "Infusion profitability was affected due to opening additional pharmacies, and the resulting expense levels exceeded the growth of revenue," she said. "That investment is now in place and, in the fourth quarter, our profit margins in this area began to improve as our newer pharmacies matured. We expect that new services such as hospice, pain management and perinatal care will also stimulate our infusion and high- technology nursing revenue."
 "General, administrative and selling expenses in fiscal 1993 rose partially because of start-up expenses associated with our new Management Information System. This new MIS software system was developed to ensure control over future growth and to meet our quality standards. It is tailored specifically to the requirements and components of our home health care operation," Ms. Figge said. "We have also replaced the accounting software to enable us to meet our plans for the future."
 "We continued expanding during fiscal 1993, by adding eight offices; entering three new markets and adding two pharmacies," she said. "We also continued to incorporate new types of health-related services that will be emphasized in the future. Our growth strategy continues to be entrance into new markets by acquiring Medicare-certified companies in the country's 40 largest markets and then to expand this base by offering a complete range of comprehensive services at the highest quality standards."
 FINANCIAL POSITION STRONG
 "The company's financial position remains strong. Our bad debt and days sales outstanding (54 at Sept. 30, 1993) numbers continue to be among the best in the home care industry," Ms. Figge said. "Shareholders' equity rose 10 percent to $27 million. Working capital totaled $14 million at Sept. 30, 1993, with $3 million of this in cash. We also have available an unused $10 million bank line of credit."
 FOURTH-QUARTER RESULTS
 For the fourth quarter ended Sept. 30, 1993, In Home Health had revenue of $27.3 million and a net loss of $320,000, or $.02 per share, compared with revenue of $21.7 million and net income of $678,000, or $.04 per share, in the fourth quarter of the previous year. The net loss for the fourth quarter was due to the special charges mentioned above relating to Medicare and the adoption of SFAS No. 109. In the fourth quarter, before the special charges, net income was $465,000, or $.03 per share.
 In Home Health provides comprehensive health care services to clients of all ages in their own homes. The company currently operates 38 locations in 16 geographic markets, including: Phoenix; Los Angeles and San Francisco; Denver; Chicago; Detroit; Minneapolis/St. Paul; Kansas City and St. Louis; Raleigh-Durham, N.C.; Cincinnati; Pittsburgh; Dallas and Houston; Norfolk, Va.; and Seattle.
 IN HOME HEALTH, INC.
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (Amounts in thousands, except per share amounts) (Unaudited)
 Three Months Ended: Year Ended:
 9-30-93 9-30-92 9-30-93 9-30-92
 Revenue $27,250 $21,674 $103,761 $75,072
 Direct costs of revenue 15,615 12,098 57,059 41,111
 General, administrative
 and selling expenses 11,775 8,530 44,270 30,121
 Income (loss) from
 operations (140) 1,046 2,432 3,840
 Interest expense, net 134 84 480 124
 Income before income taxes (274) 962 1,952 3,716
 Income tax expense (26) 284 865 1,413
 Income (loss) before
 cumulative effect of change
 in accounting principle (248) 678 1,087 2,303
 Cumulative effect of change
 in accounting principle 72 0 72 0
 Net income (loss) ($320) $678 $1,015 $2,303
 Net income (loss) per share ($.02) $.04 $.06 $.15
 Weighted average number
 of common and
 common equivalent shares 15,974 15,969 16,056 15,780
 -0- 11/29/93
 /CONTACT: Mike Kennedy, vice president-treasurer of In Home Health, 612-449-7500/
 (IHHI)


CO: In Home Health, Inc. ST: Minnesota IN: HEA SU: ERN

ML -- DE022 -- 8365 11/29/93 14:40 EST
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Date:Nov 29, 1993
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