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QUANTUM HEALTH RESOURCES REPORTS INCREASE IN FIRST QUARTER REVENUE, OPERATING INCOME; NONRECURRING COSTS OF ACQUISITION PARE NET INCOME

 ORANGE, Calif., April 28 /PRNewswire/ -- Quantum Health Resources Inc. (NASDAQ: QHRI) today reported revenues and net income for the first quarter ended March 31, 1993. The company also released restated prior period financial statements which reflect its Feb. 25, 1993, acquisition of The I.V. Clinic Inc. and its two 75 percent owned subsidiaries ("IVC"), a Texas provider of pediatric and adult home infusion therapies and services to individuals affected by chronic and non-chronic disorders. This transaction has been accounted for as a pooling of interests.
 For the 1993 quarter, revenues increased by $13,476,100, or 47 percent, to $42,294,700. Operating income, which bore $927,000 in non-recurring merger transaction costs relating to the IVC acquisition, increased $668,700, or 16 percent, over the 1992 quarter; before such costs, the increase would have been 37 percent. Net income, however, decreased slightly to $3,209,000, compared to $3,290,200 for the first quarter of 1992. This decline was primarily attributable to several factors, all relating to the IVC merger. The restatement of the prior year first quarter produced a much lower effective income tax rate since a significant portion of IVC's earnings were generated by an S Corporation not subject to federal income taxes; the 1992 quarter also included revenues and operating income that pertained to an IVC business relationship that was mutually terminated at the end of that quarter. At the same time, the most recent quarter included transaction costs relating to the conclusion of the IVC merger. Earnings per share declined slightly from $0.22 to $0.21 for the same reasons.
 Commenting on the quarter just ended, Douglas H. Stickney stated, "Although the accounting conventions relating to poolings of interests and income taxes cloud the comparisons, I believe we had a very strong first quarter compared to the year ago and trailing quarters. Revenues were up significantly and operating income, when adjusted for the fourth quarter's litigation settlement and this quarter's transaction costs, reflected solid gains as well. Gross margin is also tracking as expected from the fourth quarter.
 "There are several important considerations in assessing these operating results. First, IVC's revenue and earnings contributions to the comparable period in 1992 included a traditional home I.V. therapy relationship it chose to discontinue at the end of that quarter -- a decision with which we wholeheartedly concur. Moreover, IVC's historical financials for the 1992 quarter reflect only a 14 percent effective tax rate due to the S Corporation status of a significant portion of IVC's earnings. Second, our 1993 figures include the one-time merger transactions costs.
 "A better analysis of our performance can be made in this and subsequent periods this year by excluding the 1993 merger transaction costs and assessing an equivalent pro forma tax rate of approximately 40 percent for both the 1992 and 1993 periods.
 "As the notes to the attached Summary Statement of Income indicate, from an earnings per share standpoint, the use of an equivalent pro forma tax rate alone would convert the quarterly performance from a modest decline to a modest improvement, resulting in a comparison of $0.20 this year to $0.19 for the first quarter of 1992. The prior period also includes an extra $0.02 relating to the discontinued traditional I.V. business relationship discussed above. Further, this year's first quarter bears a rounded $0.04 in merger transaction costs. From that perspective, an apples-to-apples comparison is much more indicative of our strong first quarter 1993 performance -- $0.24 this year compared to $0.17 last year.
 "We are tremendously pleased with the IVC acquisition and our combined results," concluded Stickney. "IVC has, in one step, gained us a major position in the southwest marketplace as well as some unique insights into new disease categories. We believe we are now even better-positioned for the future."
 Quantum Health Resources Inc. is a national provider of therapies and support services to individuals affected by chronic disorders requiring lifelong therapy. Quantum's Chronicare(TM) service is designed to provide therapies and services that enable patients and their families to manage the patient's condition with greater independence, address psychosocial issues related to the disorder and manage the financial burden of the cost of care.
 QUANTUM HEALTH RESOURCES INC. AND SUBSIDIARIES
 Summary Statement of Income
 (Unaudited)
 Three Months Ended
 3/31/93 3/31/92(a)(d)
 Revenues $42,294,700 $28,818,600
 Operating income(b) 4,952,300 4,283,600
 Net income $3,209,000 $3,290,200
 Earnings per share $0.21 $0.22
 Weighted average shares outstanding 15,403,800 15,159,700
 Supplemental pro forma data(c):
 Net income $3,084,000 $2,928,100
 Earnings per share $0.20 $0.19
 Selected Balance Sheet Items
 3/31/93 12/31/92(a)
 Consolidated Balance Sheet Data:
 Current assets $83,301,200 $88,598,500
 Total assets $90,264,600 $94,591,400
 Liabilities $14,138,600 $21,125,900
 Stockholders' equity $76,126,000 $73,465,500
 (a) Restated to account for the Feb. 25, 1993, acquisition of The I.V. Clinic Inc. ("IVC") as a pooling of interests.
 (b) Operating income for 1993 quarter included $927,000 of non- recurring merger transaction costs pertaining to the acquisition of IVC which are not deductible for income tax purposes. These charges reduced net income and earnings per share by $552,000 and $0.036 per share, respectively, in the first quarter of 1993.
 (c) Supplemental pro forma data reflect the combined net income of the company and IVC, adjusted by a pro forma increase in income tax expense for financial reporting purposes on certain S Corporation earnings of IVC which had not been subject to federal income taxes prior to the acquisition, using the company's blended effective income tax rate for the respective periods.
 (d) Operating results for 1992 quarter included revenues and operating income attributable to one of IVC's then-largest business relationships which was discontinued, by mutual agreement, on March 31, 1992, in conjunction with IVC's decision to shift its strategic emphasis to patients affected by chronic disorders. Revenues, operating income and earnings per share (reported and pro forma) generated from this relationship approximated $1.5 million, $0.4 million and $0.02 per share, respectively, in the 1992 quarter.
 -0- 4/28/93 R
 /CONTACT: Douglas H. Stickney, chairman, CEO and president, or William James Nicol, senior VP and CFO of Quantum Health Resources, 714-750-1610; or Gary Strong or Kathy Brunson of The Financial Relations Board, 312-266-7800, for Quantum Health Resources/
 (QHRI)


CO: Quantum Health Resources Inc. ST: California IN: HEA SU: ERN

JB-MS -- LA005 -- 2440 04/29/93 08:11 EDT
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