Navigation Links
IPC The Hospitalist Company Reports Record Third Quarter 2008 Results
Date:11/11/2008

NORTH HOLLYWOOD, Calif., Nov. 11 /PRNewswire-FirstCall/ -- IPC The Hospitalist Company, Inc. (Nasdaq: IPCM), a leading national hospitalist physician group practice, today announced financial results for the third quarter ended September 30, 2008.

Third Quarter 2008 Highlights:

-- Net revenue increased 32% year-over-year to $63.2 million, largely

driven by same-market area net revenue growth of 19%

-- Patient encounters increased 27% year-over-year to 692,000

-- Income from operations rose 93% year-over-year to $5.4 million, as

operating margin increased to 8.5% from 5.8%

-- Net income increased to $3.2 million, or $0.20 per pro-forma diluted

share

Adam D. Singer, M.D., Chief Executive Officer, stated, "We are very pleased with our growth in third quarter 2008 results, which demonstrate the continued strength of our business model with 32% overall net revenue growth and 19% same-market area net revenue growth. In addition, we continue to generate operating leverage as our revenue base expands, resulting in year-over-year growth in our operating income margin to 8.5% from 5.8%."

Dr. Singer added, "During the quarter, we closed the previously announced acquisition of Hospitalists of America, which provided us with an entry into the Southeast Florida market. Also, we recently completed three in-market acquisitions in Dallas, Texas, Ocala, Florida and Phoenix, Arizona demonstrating our growth strategy to expand in existing markets. Our acquisition pipeline remains robust in this highly fragmented industry, and we will continue to look for opportunities across the hospitalist sector."

Third Quarter 2008

IPC's third quarter 2008 patient encounters rose 27% to 692,000, compared to 544,000 in the same period last year. The Company reported third quarter 2008 net revenue of $63.2 million, a 32% increase from $47.8 million for the third quarter of 2007. Of the increase in net revenue, 57% was attributed to same-market areas. Third quarter 2008 same-market area net revenue grew 19% and same-market area patient encounters rose 14%. The increase in same-market area net revenue was primarily due to an increase in patient encounters from existing hospitalists, as well as new hospitalists either hired or added from in-market acquisitions.

Physician practice salaries and other expenses for the third quarter of 2008 were $45.8 million, compared to $35.4 million in the third quarter of 2007. The physician practice expenses as a percentage of net revenue decreased to 72.5%, compared to 74% for the same period of the prior year. The decrease in physician costs as a percentage of revenue was the result of higher average productivity per physician.

General and administrative expenses for the third quarter of 2008 were $11.4 million, compared to $9.3 million for the third quarter of 2007. General and administrative expenses as a percentage of revenue declined to 18% for the third quarter of 2008, compared to 19.4% for the third quarter of 2007, as the Company continues to leverage these costs over a larger revenue base.

Income from operations for the third quarter of 2008 increased 93% to $5.4 million, compared to $2.8 million for the third quarter of 2007, which was net of depreciation and amortization of $0.6 million and $0.4 million for 2008 and 2007, respectively. Operating margin rose to 8.5% for the third quarter of 2008, compared to 5.8% for the third quarter of 2007. The increase in operating margin was the result of the reduction of physician costs as a percentage of revenue and general and administrative expenses as a percentage of revenue as the Company continues to leverage its administrative costs over a larger revenue base as it grows its existing practices and continues to acquire new practices.

Third quarter 2008 net income was $3.2 million, or $0.20 per pro-forma diluted share, compared to a net loss of $7.3 million, or a loss of $0.65 per pro-forma diluted share, for the third quarter of 2007. The third quarter of 2007 included a loss of $8.7 million due to the change in the fair value of preferred stock warrant liabilities.

Nine Months Ended September 30, 2008

For the nine months ended September 30, 2008, IPC reported net revenue of $182.9 million, an increase of 33% from $137.4 million for the comparable 2007 period. Income from operations was $15.6 million compared to $9.7 million for the first nine months of 2007. Net income for the first nine months of 2008 was $8.9 million or $0.59 per pro-forma diluted share compared to a net loss of $3.7 million or a loss $0.33 per pro-forma diluted share for the same period of the prior year. The comparable period of 2007 included a loss of $8.8 million due to the change in the fair value of preferred stock warrant liabilities.

Recent Developments

In October, the Company completed the acquisition of three in-market acquisitions in Dallas, Texas, Ocala, Florida and Phoenix, Arizona.

Guidance

The Company previously announced financial guidance for the full year 2008 for revenue to be in the range of $254 million to $257 million and earnings per pro-forma diluted share to be in the range of $0.85 to $0.88. Based on the overall negative economic environment and softness in hospital census, the Company now expects full year 2008 financial results to be close to the low end of the previously announced range.

Conference Call

IPC The Hospitalist Company will host an investor conference call to review the quarterly results at 5:00 p.m. ET (2:00 p.m. PT) today. To participate in the conference call, please dial 877-719-9795 (USA) or 719-325-4776 (International). In addition, a dial-up replay of the conference call will be available beginning November 11, 2008 at 8:00 p.m. ET (5:00 p.m. PT) and ending on November 25, 2008. The replay telephone number is 888-203-1112 (USA) or 719-457-0820 (International) Replay Passcode: 9105145. A live web cast of the call will also be available from the Investor Relations section on the corporate web site at http://www.hospitalist.com. A web cast replay can be accessed on the corporate web site beginning November 11, 2008 at approximately 8:00 p.m. ET (5:00 p.m. PT) and will remain available until December 11, 2008.

About IPC The Hospitalist Company

IPC The Hospitalist Company, Inc. (Nasdaq: IPCM) is a leading national hospitalist physician group practice focused on the delivery of hospitalist medicine services. IPC's physicians and affiliated providers manage the care of hospitalized patients in coordination with primary care physicians and specialists. The Company provides its hospitalists with the comprehensive training, information technology, and management support systems necessary to improve the quality and reduce the cost of inpatient care in the facilities it serves. For more information, visit the IPC website at http://www.hospitalist.com.

Safe Harbor Statement

Certain statements and information in this press release may be deemed to be "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release may include, but are not limited to, those statements set forth under the section titled "Guidance" regarding projected operating results, revenues, earnings, and IPC's growth opportunities and strategy. Forward-looking statements are often characterized by terminology such as "believe", "hope", "may", "anticipate", "should", "intend", "plan", "will", "expect", "estimate", "project", "positioned", "strategy" and similar expressions. Any forward-looking statements are necessarily based on a variety of estimates and assumptions which, though considered reasonable by the Company, may not be realized and are inherently subject to significant business, economic, competitive, industry, regulatory, market and financial uncertainties and contingencies, many of which are and will be beyond IPC's control. Important risks and uncertainties that could cause actual results, developments and business decisions to differ materially from those contemplated by any forward-looking statements are described in IPC's most recent Annual Report on Form 10-K, including the section titled "Risk Factors" and actual results could differ materially from those anticipated in forward-looking statements.

In particular the following risks and uncertainties may have such an impact:

-- failure to comply with complex and intensive government regulation of

our industry;

-- the adequacy of our insurance coverage and insurance reserves;

-- our ability to recruit and retain qualified physicians;

-- our ability to successfully integrate new acquisitions;

-- the effect of changes in rates or methods of third-party reimbursement;

and

-- the high level of competition in our industry.

IPC undertakes no obligation following the date of this press release to update or revise any such statements or projections whether as a result of new information, future events, or otherwise.

Contacts:

Devra Shapiro

IPC The Hospitalist Company, Inc.

(818) 766-3502

Stephanie Carrington/Ben Carmichael

The Ruth Group

(646) 536-7017/7023

scarrington@theruthgroup.com

bcarmichael@theruthgroup.com

IPC The Hospitalist Company, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except for share data)

September 30,

2008 December 31,

(unaudited) 2007

Assets

Current assets:

Cash and cash equivalents $55,092 $6,976

Accounts receivable, net 41,329 39,494

Prepaid expenses and other current assets 3,846 10,203

Total current assets 100,267 56,673

Furniture and equipment, net 2,708 2,189

Goodwill 54,076 34,754

Other intangible assets, net 2,875 808

Deferred tax assets, net 2,952 2,952

Total assets $162,878 $97,376

Liabilities

Current liabilities:

Accounts payable and accrued liabilities $4,588 $4,667

Accrued compensation 12,261 12,382

Payables for practice acquisitions 5,936 292

Medical malpractice and self-insurance

reserves, current portion 992 951

Deferred tax liability 45 45

Short-term debt and current portion of

capital leases 3,611 7,029

Total current liabilities 27,433 25,366

Long-term debt and capital leases, less current

portion 6,197 19,793

Medical malpractice and self-insurance reserves,

less current portion 11,028 8,900

Other long-term liabilities 300 300

Total liabilities 44,958 54,359

Stockholders' equity:

Convertible preferred stock, Series A, B,

C, and D $0.001 par value, 64,905,826 shares

authorized, 57,761,235 shares issued and

outstanding in 2007; liquidation preference

of $43,230,532 in 2007 - 57

Preferred stock, $0.001 par value,

15,000,000 and 294,174 shares

authorized in 2008 and 2007, respectively,

none issued - -

Common stock, $0.001 par value, 50,000,000

and 87,300,000 shares authorized in 2008 and

2007, respectively, 16,042,013 and 1,878,382

shares issued and outstanding in 2008 and

2007, respectively 16 2

Additional paid-in capital 121,626 55,605

Accumulated deficit (3,722) (12,647)

Total stockholders' equity 117,920 43,017

Total liabilities and stockholders' equity $162,878 $97,376

IPC The Hospitalist Company, Inc.

Condensed Consolidated Statements of Operations

(dollars in thousands, except for per share data)

(unaudited)

Three months ended Nine months ended

September 30, September 30,

2008 2007 2008 2007

Net revenue $63,164 $47,839 $182,877 $137,425

Operating expenses:

Cost of services -

physician practice

salaries, benefits and

other 45,816 35,408 132,996 100,090

General and

administrative 11,368 9,274 32,727 26,612

Depreciation and

amortization 591 360 1,535 1,003

Total operating

expenses 57,775 45,042 167,258 127,705

Income from operations 5,389 2,797 15,619 9,720

Investment income 186 106 493 329

Interest expense (144) (398) (724) (1,241)

Loss on fair value of

preferred stock warrant

liabilities - (8,695) - (8,781)

Income (loss) before

income taxes 5,431 (6,190) 15,388 27

Income tax provision 2,281 1,064 6,462 3,705

Net income (loss) 3,150 (7,254) 8,926 (3,678)

Accretion of redeemable

convertible preferred

stock - (69) - (206)

Income allocable to

preferred stockholders - - (696) -

Net income (loss)

attributable to common

stockholders $3,150 $(7,323) $8,230 $(3,884)

Per share data:

Net income (loss) per

share attributable to

common stockholders-

historical:

Price per share:

Basic $0.20 $(3.97) $0.59 $(2.35)

Diluted $0.20 $(3.97) $0.58 $(2.35)

Weighted average shares

Basic 15,784,000 1,846,000 14,037,000 1,654,000

Diluted 15,987,000 1,846,000 14,308,000 1,654,000

Net income (loss) per

share attributable to

common stockholders-

pro forma:

Price per share:

Basic $0.20 $(0.65) $0.60 $(0.33)

Diluted $0.20 $(0.65) $0.59 $(0.33)

Weighted average shares

Basic 15,784,000 11,208,000 14,881,000 10,995,000

Diluted 15,987,000 11,208,000 15,099,000 10,995,000

IPC The Hospitalist Company, Inc.

Condensed Consolidated Statements of Cash Flows

(dollars in thousands)

(unaudited)

Nine Months Ended

September 30,

2008 2007

Operating activities

Net income (loss) $8,926 $(3,678)

Adjustments to reconcile net income (loss) to net

cash provided by operating activities:

Depreciation and amortization 1,535 1,003

Stock-based compensation expense 641 45

Deferred income taxes - (283)

Revaluation of preferred stock warrant

liabilities - 8,781

Changes in assets and liabilities:

Accounts receivable (1,835) (3,023)

Prepaid expenses and other current assets 6,355 2,530

Accounts payable (81) 779

Accrued compensation (120) (127)

Medical malpractice and self-insurance

reserves 2,169 2,014

Accrued litigation loss and other claims - 35

Net cash provided by operating activities 17,590 8,076

Investing activities

Acquisitions of physician practices (16,252) (11,484)

Purchase of furniture and equipment (1,545) (633)

Cash restriction by lender - 2,500

Net cash used in investing activities (17,797) (9,617)

Financing activities

Proceeds from (repayments of) long-term debt and

capital leases, net (17,014) 828

Net proceeds from issuance of common and

preferred stock 65,022 438

Excess tax benefits from stock-based

compensation 315 481

Net cash provided by financing activities 48,323 1,747

Net increase in cash and cash equivalents 48,116 206

Cash and cash equivalents, beginning of period 6,976 5,946

Cash and cash equivalents, end of period $55,092 $6,152

Supplemental disclosure of cash flow information

Cash paid for:

Interest $701 $1,065

Income taxes $5,312 $3,123

Acquisitions of physician practices consisted of

the following:

Acquired assets $21,896 $9,317

Accrued consideration (5,644) 2,167

Net cash paid for acquisitions $16,252 $11,484

IPC The Hospitalist Company, Inc.

Operating Data

Number of Patient Encounter Data (unaudited):

The following is a summary of the quarterly patient encounters for the

seven quarters ended September 30, 2008:

Quarter Ended:

Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30,

2007 2007 2007 2007 2008 2008 2008

Patient

encounters 504,000 511,000 544,000 594,000 684,000 660,000 692,000


'/>"/>
SOURCE IPC The Hospitalist Company, Inc.
Copyright©2008 PR Newswire.
All rights reserved


Related medicine news :

1. IPC The Hospitalist Company, Inc. to Present at the 2008 Annual Credit Suisse Health Care Conference
2. IPC The Hospitalist Company Acquires Phoenix Area Practice
3. IPC The Hospitalist Company, Inc. to Report Third Quarter 2008 Financial Results
4. IPC The Hospitalist Company Enters Ohio and Pennsylvania Markets
5. IPC The Hospitalist Company Completes Acquisition of Hospitalists of America
6. IPC The Hospitalist Company, Inc. to Report Second Quarter 2008 Financial Results
7. IPC The Hospitalist Company Acquires Texas Inpatient Services
8. Night Hospitalist Company, LLC Launches First Nighttime Hospitalist Telemedicine Solution
9. IPC The Hospitalist Company, Inc. Provides Second Quarter 2008 Outlook
10. IPC The Hospitalist Company, Inc. Files Registration Statement for Proposed Offering
11. Ingenious Meds IM Quality Measures(TM) Delivers Insight About Hospitalist Performance
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:6/24/2016)... ... June 24, 2016 , ... Marcy was in a crisis. Her son James, eight, was ... his family verbally and physically. , “When something upset him, he couldn’t control his emotions,” ... He would throw rocks at my other children and say he was going to kill ...
(Date:6/24/2016)... ... June 24, 2016 , ... Global law firm Greenberg Traurig, P.A. announced that ... chosen by their peers for this recognition are considered among the top 2 percent ... special honors as members of this year’s Legal Elite Hall of Fame: Miami ...
(Date:6/24/2016)... ... June 24, 2016 , ... Comfort Keepers® of San Diego, CA is ... Road To Recovery® program to drive cancer patients to and from their cancer treatments. ... the highest quality of life and ongoing independence. Getting to and from medical ...
(Date:6/24/2016)... Plano, TX (PRWEB) , ... June 24, 2016 , ... ... taking part in Genome magazine’s Code Talker Award, an essay contest in which patients ... for an award to be presented at the 2016 National Society of Genetic Counselors ...
(Date:6/24/2016)... (PRWEB) , ... June 24, 2016 , ... ... Living, is proud to recognize Dr. Barry M. Weintraub as a prominent plastic ... most beautiful women in the world, and the most handsome men, look naturally ...
Breaking Medicine News(10 mins):
(Date:6/23/2016)... 23, 2016 The vast majority of dialysis ... facility.  Treatments are usually 3 times a week, with ... including travel time, equipment preparation and wait time.  This ... grueling for patients who are elderly and frail.  Many ... and rehabilitation centers for some duration of time. ...
(Date:6/23/2016)... Tenn. , June 23, 2016 /PRNewswire/ ... automating, integrating and transforming the patient payment ... of several innovative new products and services ... of its revenue cycle offerings. These award-winning ... more efficient workflows, remain compliant in an ...
(Date:6/23/2016)... , June 23, 2016  The National ... has joined the health policy research organization as ... Romano , MD, senior vice president and chief ... company,s representative on the NPC Board of Directors. ... pleased that Mallinckrodt has joined us in support ...
Breaking Medicine Technology: