Other operating costs increased $4.5 million, or 6.4%, in the first six months of the 2009 over the same period in the prior year due to additional variable compensation accruals of $4.0 million, higher occupancy costs of $1.2 million, other operating costs of acquisitions of $1.0 million and additional bad debt expense of $1.0 million, offset by lower advertising costs of $1.2 million and $1.5 million of reductions in other overhead costs. As a percentage of sales, other operating costs decreased by 10 basis points compared to last year's second quarter.
Interest expense for the six months ended June 30, 2009 was $1.1 million less than the same period of last year due to lower variable interest rates.
Net income applicable to common stock for the six months ended June 30, 2009 increased by 25.8% to $14.6 million, or $0.46 per diluted share, compared to pro forma net income applicable to common stock of $11.6 million, or $0.37 per diluted share, in the prior year. The pro forma results for the six months ended June 30, 2008 assume that the previously described one-time, in-kind preferred stock dividend occurred and the preferred stock was converted to common stock at the beginning of the period. Net income applicable to common stock for the six months ended June 30, 2008 on a GAAP basis was $5.9 million, or $0.24 per diluted share.
Cash from operations increased by $4.5 million, or 22.2%, to $24.5 million in the second quarter of 2009, compared to the same quarter in 2008. The improvement was primarily the result of improved operating results and a $2.7 million decrease in working capital offset by a $0.3 million decrease in non-cash items. Days sales outstanding were reduced by 4 days to 48 days as of June 30, 2009 from 52 days as of June 30, 20
|SOURCE Hanger Orthopedic Group, Inc.|
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