United American Healthcare Corporation Announces Fiscal 2008 Third Quart...(he Western GrandRegion of Tennessee when...),Health

Date:5/13/2008

he Western Grand Region of Tennessee when its current TennCare contract expires. Its TennCare contract represented 59 percent of the Company's total revenues in the nine months ended March 31, 2008. UAHC-TN's TennCare members are expected to transfer to other managed care organizations on November 1, 2008, after which UAHC-TN will perform its remaining contractual obligations through its TennCare contract expiration date (which it expects will be extended to June 30, 2009).

The Company reported a net loss of $3.8 million, or ($0.43) per basic share, in the 2008 fiscal third quarter, compared with a net loss of $0.04 million, or ($0.00) per basic share, in the comparable quarter of fiscal 2007. The decline in third quarter profitability was primarily attributable to a $3.5 million goodwill impairment charge resulting from the pending expiration of UAHC-TN's TennCare contract, in addition to a $1.5 million charge related to the write-down of a deferred tax asset also resulting from the pending expiration of the TennCare contract. Both the goodwill impairment charge and the deferred tax asset charge are non-cash charges, in accordance with GAAP guidelines.

Excluding the goodwill impairment and the deferred tax asset charges recorded in the third fiscal quarter ended March 31, 2008, the Company reported pro-forma net income of $1.2 million, or $0.14 per basic share, in that quarter.

"We remain committed to maintaining the highest level of service to our members throughout the duration of our TennCare contract," said William C. Brooks, president, chairman and CEO of United American Healthcare. "Although we are disappointed by not obtaining a new TennCare contract, we are currently evaluating a short list of strategic alternatives identified to help offset the anticipated material decline in our Medicaid revenues beginning Nov. 1, 2008, while acting in the best interests of the Company and its shareholders.

Brooks continued: "Given our ample li
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SOURCE United American Healthcare Corporation Copyright©2008 PR Newswire. All rights reserved

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