Companies in the News
Companies in the News
Amedisys reports FY98 results; CFO resignsAmedisys’ (Baton Rouge, LA) CFO, Mitch Morel, resigned March 31 to pursue other interests. The company has not yet named a replacement. Amedisys saw total revenues of $38.1 million in FY98 ended Dec. 31, up from FY97 restated revenues of $37.2 million. The company recorded a net loss in FY98 of $24.9 million, $8.12 per share, compared to a FY97 net loss of $1.2 million, 43 cents per share. Amedisys officials attribute the company’s flat revenue growth to the Interim Payment System (IPS) and the per-beneficiary limit. Amedisys’ FY97 earnings were restated for comparative purposes due to the discontinued operations of its staffing division, which the company sold in 1998. The loss, officials said, was a result of a $10 million write off of acquisition-related goodwill from the consolidation and strategic alignment of certain offices, the start up of its infusion therapy division, operating loss from acquisitions, and the effects of IPS and the per-beneficiary limit.
AHOM to file 10-K lateAmerican HomePatient (AHOM; Brentwood, TN) will not file its annual report on time this year. The company has filed a notification of late filing with the Securities and Exchange Commission (SEC; Washington) under rule 12b-25. AHOM said it will file its annual report with the SEC no later than April 15. The company said it is unable to file on time because it is negotiating with its lenders to potentially amend the bank credit facility to remedy its covenant default status and modify certain financial and other covenants going forward. The company is currently in default of several financial covenants under its bank credit facility. Because these negotiations are not completed, the company is unable to finalize the classification of its debt and complete other portions of the company’s financial statements.
AHOM also said it intends to record an accrued severance expense charge and a non-recurring pre-tax accounting charge for goodwill during 4Q98.
Apria announces first profit in yearApria Healthcare Group (Costa Mesa, CA) last week announced a net profit for the quarter ended Dec. 31 of $2.3 million, 4 cents per share, compared to a net loss in 4Q97 of $238.2 million, $4.62 per share. The profit is the first the company has reported in more than a year.
Net revenues for 4Q98 were $223.3 million, compared to $266.7 million in 4Q97. The decline in 4Q98 revenues reflects Apria’s continued exit of unprofitable elements of its business, officials said.
For the year ended Dec. 31 Apria reported a net loss of $207.9 million, $4.02 per share, compared to a net loss of $272.6 million, $5.30 per share, in FY97. FY98 revenues totaled $933.8 million, compared to FY97 revenues of $1.2 billion. In FY98, Apria generated positive operating cash flow of $133.9 million, compared to $104.1 million in FY97.
In October 1998, Apria announced plans to proceed with a $50 million rights offering of convertible subordinated debentures to stockholders and to use the net proceeds of the offering to reduce bank indebtedness. This offering, which would be underwritten by Relational Investors, Apria’s largest shareholder, is still available to the company.
Since October, Apria believes there has been an improvement in the capital markets and an improvement in the company’s results of operations and financial position. As a result, the company now intends to pursue an alternative $50 million financing with unrelated third parties on terms more favorable to the company than the previously announced rights offering. In the event that such a financing can be completed with pricing acceptable to the company, Apria will not proceed with the contemplated rights offering.
Apria said it expects its 1Q99 revenues will be higher than 4Q98 revenues. In addition, the company said it expects to see a profit in 1Q99 of 25 cents per share. The current First Call consensus of analysts’ expectations for 1Q99, however, is a profit of 4 cents per share.
In other news, Respironics (Pittsburgh) has signed a contract extension to supply Apria with respiratory products through the end of February 2002. Under the terms of the renewed contract, Respironics is the primary supplier for all sleep therapy units and accessories. It also will be the single source provider for sleep study equipment and accessories and infant apnea monitors and accessories. In addition, Respironics has been named a shared primary supplier for volume ventilators.
In other news, An investment group, including investor Peter Cooper, reported a 5.5% investment stake in Apria last week. In a filing with the Securities and Exchange Commission (Washington), the group said it bought 263,600 common shares between March 17 and March 26 at prices ranging from $7.34 to $7.95 a share and currently holds 2.84 million shares of Apria. According to the filing, the group’s holdings of the shares are for investment purposes, and the group has no extraordinary plans regarding the company.
Bindley 29th best company for investorsBindley Western (Indianapolis) was ranked 29th out of 500 companies that were highlighted as America’s Best Companies for Investors in a recent issue of Barron’s magazine. To complete the list, Barron’s reviewed the top 500 U.S. public companies, comparing annual revenues, and then ranked the companies based on stock-market returns and profitability.
OIG subpoenas Centennial’s Medicare recordsCentennial Healthcare Corp. (Atlanta), which owns subsidiaries that provide home health services, received a subpoena for Medicare records from four of its nursing homes. The subpoena was issued in connection with a civil investigation of possible improper Medicare claims, reported The Wall Street Journal. The industry believes that the Office of Inspector General (OIG) is looking at all long term care companies, Centennial CFO Alan Dahl told the Journal. "It may be that we were the next name drawn out of the hat," he said.
Patient Care acquires GA companyChemed’s (Cincinnati) Patient Care (West Orange, NJ) subsidiary has acquired the assets of Georgia Nursing Services, a home care company operating in the central Georgia market that generated revenues exceeding $3.1 million in FY98. The purchase price for the company was not disclosed.
CCSE to trade on Nasdaq Bulletin BoardCommunity Care Services’ (CCSE; Mount Vernon, NY) common stock has been delisted from the Nasdaq Small Cap as of the close of business on March 30 and will now trade on the Nasdaq Bulletin Board. The decision to delist the stock was based upon the failure of the stock to maintain a minimum bid price of $1 pursuant to Nasdaq marketplace rules. The company has proposed a 1-for-3 reverse split to be considered at the April 8 annual shareholders meeting. CCSE said it believes this would cause the bid price of the stock to be in compliance with the Nasdaq Marketplace rules.
Coram to sell products on InternetCoram Healthcare (Denver) announced last week its Internet strategy, which includes plans to sell prescription medication, over-the-counter products, vitamins, and supplements, as well as other healthcare-related products, on line through its Coram Prescription Services (CPS) subsidiary. In addition to selling products, the on-line pharmacy will allow CPS to expand its disease state management programs.
In other news, shareholders who sued Coram over alleged false statements that artificially inflated the price of the company’s stock have petitioned the U.S. Supreme Court to review the dismissal of the suit. The suit, originally filed in 1995, was dismissed by the U.S. District Court for the Northern District of Georgia in 1997. That decision was upheld by the Eleventh Circuit Court of Appeals in October 1998. The plaintiffs filed the petition for review with the High Court on March 15, according to the company’s annual report filed with the Securities and Exchange Commission (Washington).
In other news, Coram may have to repay a $12.7 million tax refund it received from 1995 if the IRS prevails in its proposed adjustments, notice of which the company received in January. Coram said it intends to contest the notice. For FY95, Coram posted a loss of $334.2 million, $8.39 per share, on revenues of $602.6 million. The refund covered deductions for warrants, the write-off of goodwill and the specified liability portion of the FY95 loss that affected the prior year’s tax liability. The company agreed to an adjustment of $24.4 million that only affects net operating loss carryforwards available, but doesn’t agree with the other proposed adjustment.
GF misses date to file 10-KGraham-Field Health Products (GF; Hauppauge, NY) said it missed its March 31 due date to file its annual report because of accounting irregularities and errors the board’s audit committee identified recently. The investigation by the audit committee required GF to restate its FY96 and FY97 earnings. The company said in a filing with the Securities and Exchange Commission (Washington) that it is in the process of determining the amount of adjustments needed to be made to the financials, which will then be subject to audit by GF’s independent auditors, Ernst & Young (New York).
HealthCor to delay 10-k filingHealthCor Holdings (Dallas) filed a not timely form last week with the Securities and Exchange Commission (Washington), saying it has seen a delay in the completion of its annual 10-K filing due to changes in Medicare reimbursement and a "material reduction in staff." The company said in the filing that it has experienced a "significant change in its operating environment" due to substantial changes and reductions made in reimbursement for Medicare part A nursing and therapy services. As a result of these changes and the subsequent restructuring undertaken since the beginning of 4Q98, HealthCor has sold certain of its assets and operations, which has required substantial alteration of its accounting processes and procedures.
HealthCor, according to the filing, expects the FY98 results to represent a loss for the company, stemming from the reimbursement reductions and the subsequent asset sales.
Invacare introduces new seating systemInvacare Corp. (Elyria, OH) has introduced a new seating system called Invacare Infinity Seating Technology. The seating offers support, positioning, and pressure reduction for home care clients with simple to moderately complex seating needs. It includes three layers of cushioning: the postural support layer, the pelvic support layer, and the ischial relief insert. Several options are available to meet a variety of needs.
Mid-South employees fight for back wagesAbout 30 employees of Mid-South Home Health (Memphis, TN) went to court last week to fight for back wages earned just prior to the company’s abrupt closing on Feb. 17. The closing left most of the 300 Mid-South employees unpaid for four weeks work, and the parent company, Hospital Staffing Services (HSS; Fort Lauderdale, FL) filed Chapter 7 bankruptcy two days later. Last month, U.S. Dist. Judge Bernice Donald ordered that HSS not move company documents, including time sheets and invoices, out of its Memphis office. She also ordered money collected from the invoices issued since Jan. 23, the last time employees were paid, be kept in a separate account, reported The Commercial Appeal. That amount totals $800,000.
Respironics and Tri-anim partner to sell BiPAPRespironics (Pittsburgh) will partner with Tri-anim Health Services (Sylmar, CA) for sales and distribution of the company’s BiPAP Vision Ventilatory Support System. The system, which received clearance from the Food and Drug Administration (Washington) in November 1998, will be used for noninvasive and invasive ventilation applications.
Sunrise’s stock receives below-average ratingSunrise Medical (Carlsbad, CA) stock received a below-average rating for its timeliness and an average rating for safety by Phillip Seligman of Value Line. Investors had expected a recent restructuring of the company would result in a profit improvement and a strong 1Q. The company has noticed a sales decline in its home healthcare group. All it can do is focus on sales, reported the San Diego Union-Tribune. "There’s little left for Sunrise to do in the cost-control arena," Seligman said.
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