Revenue Growth, Margin Expansion, Propel Pediatrix's Earnings; Strong Collections Drive DSOs to Record Lows
Revenue Growth, Margin Expansion, Propel Pediatrix's Earnings; Strong Collections Drive DSOs to Record Lows
Business Editors/Health & Medical Writers
FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--Feb. 7, 2002--Pediatrix Medical Group, Inc., (NYSE:PDX) today reported financial results that demonstrate continued improvement in the company's core business.
For the three months ended December 31, 2001, Pediatrix reported earnings per share of 39 cents that included a charge for expenses related to the settlement of securities class-action litigation of approximately $900,000. Pediatrix had announced the settlement on December 14, 2001. Excluding this charge, Pediatrix earned 41 cents per share for the 2001 fourth quarter.
Net patient service revenue was $104.8 million for the three months ended December 31, 2001, an increase of 63 percent over the same period of 2000. Same unit revenue increased by 11.8 percent for the three months ended December 31, 2001.
Operating margins expanded to 18.3 percent for the 2001 fourth quarter, up from 13.4 percent for the comparable period of 2000. Fourth quarter 2001 net income was $10.1 million, up 149 percent from $4.1 million for the fourth quarter of 2000. On a per share basis, earnings of 39 cents are based on a weighted average 26.0 million shares outstanding for the three months ended December 31, 2001, and compare with earnings of 25 cents per share, based on a weighted average 16.4 million shares outstanding for the three months ended December 31, 2000.
Cash flow from operations for the fourth quarter was approximately $32 million, and was used, in part, to eliminate the outstanding balance on the company's line of credit and to finance physician group acquisitions. The company's focus on improved collections led to a reduction in days sales outstanding (DSOs) to below 60 days at December 31, 2001, down from 99 days at December 31, 2000.
For the 12 months ended December 31, 2001, net patient service revenue was $354.6 million, an increase of 46 percent over the same period of 2000. Net income for 2001 was $30.4 million, up from $11 million for 2000. Per share earnings of $1.36 are based on a weighted average 22.5 million shares outstanding at December 31, 2001, and compare with earnings of 68 cents per share, based on a weighted average 16.1 million shares outstanding for the year ended December 31, 2000. Results for the year ended December 31, 2000 include the impact of a second-quarter pre-tax charge against accounts receivable of $6.5 million. For the 12 months ended December 31, 2001, same unit revenue increased by 7.6 percent.
Cash flow from operations for the 12 months ended December 31, 2001, exceeded $90 million, up from $36.1 million for the same period in 2000.
"Our results present a very solid quarter and year that were marked by the continued expansion of our presence across the nation, as well as significant improvements in the management of our core businesses," said Roger J. Medel, M.D., Chairman and Chief Executive Officer of Pediatrix.
Results for the three months and 12 months ended December 31, 2001 were positively impacted by the acquisition of Magella Healthcare Corporation, a national group of neonatal and maternal-fetal medicine physician subspecialists. The acquisition of Magella was completed May 15, 2001.
In addition, Pediatrix acquired four neonatal physician group practices including three in the Orlando area and one in metropolitan Atlanta. During 2001, Pediatrix also acquired a maternal-fetal medicine physician practice based in Seattle and a physician practice in Dallas that cares for babies admitted to the well-baby nursery.
During 2001, Pediatrix has also succeeded in gaining operating efficiencies and market leverage as a result of the considerable presence that it enjoys in many metropolitan markets across the country. The Company expects that the opportunity to positively impact reimbursement in many of its markets may increase same-unit revenue during 2002.
Pediatrix Medical Group, Inc. will host an investor conference call to discuss the quarterly results at 11 a.m. (EST) today. During that call, members of Pediatrix's management team are expected to also provide more specific earnings guidance for 2002 and preliminary longer-term earnings guidance. The conference call will be available through simultaneous Web cast at http://www.vcall.com.
About Pediatrix
Pediatrix was founded in 1979. Its neonatal physicians provide services at more than 185 NICUs and through Obstetrix its perinatal physicians provide services in many markets where Pediatrix's neonatal physicians practice. Combined, Pediatrix and its affiliated professional corporations employ more than 590 physicians in 27 states and Puerto Rico. Additional information is available on the Internet: http://www.pediatrix.com.
Except for historical information, matters discussed in this release include forward-looking statements that involve risks and uncertainties including, but not limited to, business, financial and integration risks. In addition, Pediatrix details other risk factors in its Annual Report on Form 10-K for the year ended December 31, 2000, filed with the U.S. Securities and Exchange Commission. These risks and uncertainties could cause actual results to differ materially from those projected or anticipated in the forward-looking statements.
The forward-looking statements in this press release are made as of the date hereof based on management's current beliefs and expectations, and the Company undertakes no obligation to update or revise any such statements, whether as a result of new developments, new information or otherwise.
Pediatrix Medical Group, Inc.
Consolidated Statements of Operations
(Unaudited)
Three months ended Twelve months ended
December 31 December 31
2001 2000 2001 2000(a)
---- ---- ---- -----
(in thousands except for per share data)
Net patient service
revenue $ 104,755 $ 64,216 $ 354,595 $ 243,075
--------- --------- --------- ---------
Cost of services:
Salaries 68,137 44,757 237,896 177,718
Supplies and other
operating expenses 10,987 7,275 36,823 26,675
Depreciation and
amortization 6,412 3,561 21,437 13,810
----- ----- ------ ------
Total cost of
services 85,536 55,593 296,156 218,203
------ ------ ------- -------
Income from
operations 19,219 8,623 58,439 24,872
------ ----- ------ ------
Investment income 62 146 309 358
Interest expense (430) (818) (2,538) (3,771)
---- ---- ------ ------
Income before
income taxes 18,851 7,951 56,210 21,459
Income tax provision (8,702) (3,881) (25,782) (10,473)
------ ------ ------- -------
Net income $ 10,149 $ 4,070 $ 30,428 $ 10,986
========= ========= ========= =========
Per share data:
Net income per common
and common equivalent
share (diluted) $ 0.39 $ 0.25 $ 1.36 $ 0.68
========= ========= ========= =========
Weighted average
shares used in
computing net income
per common and common
equivalent share
(diluted) 25,989 16,404 22,478 16,053
========= ========= ========= =========
(a)These results include the impact of a second-quarter pre-tax charge
against revenue and accounts receivable of $6.5 million.
Balance Sheet Highlights
As of As of
Dec. 31, 2001 Dec. 31, 2000
------------- -------------
(in thousands)
Assets:
Cash & cash equivalents $ 27,557 $ 3,075
Accounts receivable, net 63,851 69,133
Other current assets 21,550 1,667
Other assets, property and
equipment 460,141 250,859
------- -------
Total assets $ 573,099 $ 324,734
========= =========
Liabilities and shareholders'
equity:
Accounts payable & accrued expenses $ 73,202 $ 29,878
Total debt 3,206 23,500
Other liabilities 17,839 29,456
Total liabilities 94,247 82,834
Shareholders' equity 478,852 241,900
------- -------
Total liabilities and
shareholders' equity $ 573,099 $ 324,734
========= =========
Other Operating Data
Twelve months ended
December 31,
2001 2000
---- ----
Number of:
Births 450,205 381,602
NICU Admissions 48,186 39,272
NICU Patient days 804,293 637,957
--30--bl/mi*
CONTACT: Pediatrix Medical Group, Fort Lauderdale
Bob Kneeley, 954/384-0175, x-5300
KEYWORD: FLORIDA
INDUSTRY KEYWORD: MEDICAL EARNINGS CONFERENCE CALLS
SOURCE: Pediatrix Medical Group