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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): May 6, 2003
PEDIATRIX MEDICAL GROUP, INC.
(Exact name of registrant as specified in its charter)
FLORIDA
(State or other jurisdiction of incorporation)
0-26762 65-0271219
(Commission File Number) (I.R.S. employer identification no.)
1301 CONCORD TERRACE
SUNRISE, FLORIDA 33323-2825
(Address of principal executive offices, including zip code)
(954) 384-0175
(Telephone number, including area code, of Registrant)
ITEM 9. REGULATION FD DISCLOSURE OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITION
This information, furnished under this "Item 9. Regulation FD Disclosure," is
intended to be furnished under "Item 12. Disclosure of Results of Operations and
Financial Condition" in accordance with SEC Release No. 33-8216.
On May 6, 2003, Pediatrix Medical Group, Inc. issued a press release regarding
its earnings for the first quarter ended March 31, 2003. A copy of the press
release is filed as an exhibit to this report on Form 8-K and incorporated by
reference herein.
ITEM 7(C). EXHIBITS
See Exhibit Index.
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: May 6, 2003 PEDIATRIX MEDICAL GROUP, INC.
By: /s/ KARL B. WAGNER
-------------------------
Karl B. Wagner
Chief Financial Officer
3
EXHIBIT INDEX
Exhibit No. Description
99.1 Press Release dated May 6, 2003.
Exhibit 99.1
Pediatrix Earns 68 Cents Per Share in 2003 First Quarter; Raises 2003
EPS Guidance to $3.20 to $3.26
FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--May 6, 2003--Pediatrix
Medical Group, Inc. (NYSE:PDX) reported strong 2003 first quarter
operating results that included double-digit same-unit growth.
Pediatrix has also increased 2003 earnings per share guidance
following the completion of a share repurchase program during the 2003
first quarter.
For the three months ended March 31, 2003, Pediatrix reported net
patient service revenue of $126.2 million, up 17.6 percent from $107.3
million for the three months ended March 31, 2002. Revenue growth was
driven largely by strong same unit growth as well as the impact of
acquisitions made since the beginning of 2002.
Earnings before interest, investment income, taxes, depreciation
and amortization (EBITDA) increased by 23.4 percent to $29.2 million
for the three months ended March 31, 2003, versus EBITDA of $23.7
million for the same period of 2002. EBITDA margin increased by 110
basis points, to 23.2 percent, for the 2003 first quarter, up from
22.1 percent for the comparable period of 2002.
Pediatrix's net income for the 2003 first quarter was $17.0
million or 68 cents per share, based on 25.1 million weighted average
shares outstanding. For the comparable three-month period, Pediatrix
earned $13.5 million, or 51 cents per share based on 26.6 million
weighted average shares outstanding. First quarter 2002 results
included a $1.3 million pre-tax expense related to the settlement of a
Colorado Medicaid investigation.
Same unit revenue growth for the 2003 first quarter of 14.2
percent included neonatal intensive care unit (NICU) patient volume
growth of 5.6 percent as well as contributions from several factors,
principally improved contracting and reimbursement with third-party
payors.
For the three months ended March 31, 2003, the Company had a net
use of cash for operations of $6.5 million largely as a result of
physician bonus payments and a matching 401(k) plan contribution that
had accrued during 2002, as well as regular first quarter payroll tax
payments. In addition, Pediatrix used approximately $50 million of its
cash to purchase 1.6 million shares of its common stock during the
first quarter of 2003. The Company is currently authorized to
repurchase up to an additional $50 million of its common stock.
As a result of the 2003 first quarter share repurchase program,
Pediatrix has increased earnings per share guidance for all of 2003 to
$3.20 to $3.26.
At March 31, 2003, Pediatrix had cash of $13.6 million and remains
confident it will generate cash flow from operations of approximately
$100 million for the year.
"This was another solid quarter during which we continued to make
progress in growing our business, and doing so more profitably," said
Roger J. Medel, M.D., President and Chief Executive Officer of
Pediatrix. "We continue to deliver shareholder value by operating our
business more efficiently."
During the 2003 first quarter, Pediatrix acquired a pediatric
cardiology practice based in West Palm Beach, Florida. It also
announced that it was awarded a contract to manage a NICU at Driscoll
Children's Hospital in Corpus Christi, Texas, which has historical
annual patient volume in excess of 13,000 NICU patient days. The
contract will become effective June 1, 2003.
Investor Conference Call
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 2003. The conference call
Webcast may be accessed from the Company's website,
http://www.pediatrix.com, or from http://www.companyboardroom.com. A
telephone replay of the conference call will be available from 2 p.m.
Eastern Time today through midnight Eastern Time May 13, 2003 by
dialing 800-475-6701, access code 683546. The replay will also be
available at http://www.pediatrix.com and at
http://www.companyboardroom.com.
About Pediatrix
Pediatrix was founded in 1979. Its neonatal physicians provide
services at more than 200 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 625 physicians in 30 states
and Puerto Rico. Additional information is available on the Internet:
http://www.pediatrix.com.
Matters discussed in this release may include forward-looking
statements within the meaning of the securities laws. All statements,
other than statements of historical facts, that address activities,
events or developments that Pediatrix intends, expects, believes or
anticipates will or may occur in the future are forward-looking
statements. These statements are based on assumptions and assessments
made by Pediatrix's management in light of their experience and their
perception of historical trends, current conditions, expected future
developments and other factors they believe to be relevant. Any
forward-looking statement is not a guarantee of future performance and
is subject to various risks and uncertainties that could cause actual
results, developments and business decisions to differ materially from
those contemplated by such forward-looking statement. Such risks and
uncertainties include, among others: pending and future billing and
other investigations by government authorities; Pediatrix's ability to
comply with laws and regulations applicable to the healthcare
industry; limitations of, reductions in or retroactive adjustments to
reimbursement amounts or rates by government-sponsored healthcare
programs; whether physicians appropriately record the services they
provide; Pediatrix's ability to find suitable acquisition candidates
and to successfully integrate future or recent acquisitions; laws
protecting the privacy of patient healthcare information; federal and
state healthcare reform or changes in government-sponsored healthcare
programs; Pediatrix's ability to successfully recruit and retain
qualified physicians; malpractice and other lawsuits; the value of
Pediatrix's intangible assets, such as goodwill; Pediatrix's ability
to manage growth; fluctuations in quarterly results; and competition
in the healthcare industry.
Pediatrix more fully describes these and other risk factors in its
Annual Report on Form 10-K for the year ended December 31, 2002, filed
with the Securities and Exchange Commission. Any forward-looking
statements in this press release are made as of the date hereof based
on management's current beliefs and expectations and Pediatrix has no
obligation to update and revise any such statements, whether as a
result of new developments, information or otherwise.
Pediatrix Medical Group, Inc.
Consolidated Statements of Income
(Unaudited)
Three months ended
March 31,
2003 2002
---------- ----------
(in thousands, except
for per share data)
---------------------
Net patient service revenue $126,200 $107,282
---------- ----------
Operating expenses:
Practice salaries and benefits 74,616 62,534
Practice supplies and other operating expenses 4,065 3,489
General and administrative expenses(a) 18,301 17,572
Depreciation and amortization 1,650 1,465
---------- ----------
Total operating expenses 98,632 85,060
---------- ----------
Income from operations 27,568 22,222
---------- ----------
Investment income 139 153
Interest expense (290) (283)
---------- ----------
Income before income taxes 27,417 22,092
Income tax provision (10,418) (8,616)
---------- ----------
Net income $16,999 $13,476
========== ==========
Per share data:
Net income per common and common equivalent
share (diluted) $ 0.68 $ 0.51
Weighted average shares used in computing net
income per common and common equivalent share
(diluted) 25,091 26,607
(a)General and administrative expenses for the 2002 first quarter
include approximately $1.3 million in settlement expenses related to
the Colorado Medicaid investigation.
Balance Sheet Highlights
As of As of
Mar. 31, 2003 Dec. 31,
(unaudited) 2002
------------- ------------
$ in thousands
Assets:
Cash and cash equivalents $13,628 $73,195
Accounts receivable, net 83,411 75,356
Other current assets 11,880 12,804
Other assets 489,760 487,324
------------- ------------
Total assets $598,679 $648,679
============= ============
Liabilities and shareholders' equity:
Accounts payable & accrued expenses
$ 54,530 $ 76,400
Total debt 2,438 2,489
Other liabilities 25,373 21,792
------------- ------------
Total liabilities 82,341 100,681
Shareholders' equity 516,338 547,998
------------- ------------
Total liabilities and shareholders' equity
$ 598,679 $ 648,679
============= ============
CONTACT: Pediatrix Medical Group, Inc., Fort Lauderdale
Bob Kneeley, 954/384-0175, x-5300
bob_kneeley@pediatrix.com