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Rural/Metro Announces Results for Fiscal 2008 First Quarter; Fiscal 2007 Fourth Quarter and Full Year
Date:11/14/2007

this press release and with the Company's related Form 8-K.

Results of Operations for the Quarter Ended June 30, 2007

Consolidated net revenue for the fourth quarter of fiscal 2007 ended June 30, 2007 increased 3.9 percent, or $4.4 million, to $118.1 million, compared to $113.7 million for the same period of the prior year. Ambulance services revenue increased 3.3 percent, or $3.2 million, to $99.2 million, compared to $96.0 million for the prior year. Other services revenue, which includes fire services, increased 6.9 percent, or $1.2 million, to $18.9 million, compared to $17.7 million for the same prior-year period. On a consolidated basis, period-over-period net revenue growth was driven primarily by same-service area market expansion, new contracts for emergency and non-emergency ambulance services, higher subsidies negotiated under 911-emergency contracts, and rate increases on master and subscription fire contracts.

Payroll and employee benefits for the fourth quarter increased $5.2 million, or 7.7 percent, to $72.5 million, compared to $67.3 million for the same prior-year period. The increase was attributable to a $1.5 million increase in workers' compensation insurance expenses related to lower non-cash actuarial reserve adjustments compared to the prior year, and a $1.0 million increase in employee health insurance expense due to increased utilization and rising healthcare costs, with the balance primarily due to increased wages from higher transport volume and competitive wage pricing, These expenses were partly offset by a $2.2 million reduction in the Company's management incentive plan accrual for fiscal 2007.

Other operating expenses for the fourth quarter increased $2.1 million, or 7.4 percent, to $30.5 million, compared to $28.4 million for the same prior-year period. The increase was primarily attributable to a $0.8 million increase in operating supplies, vehicle maintenance and fuel expenses due to added transport volume,
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SOURCE Rural/Metro Corporation
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