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InfuSystem Holdings, Inc. Reports $14.3 Million of Revenues And $1.6 Million Of EBITDA For The First Quarter Of 2012

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MADISON HEIGHTS, Mich., May 21, 2012 /PRNewswire/ -- InfuSystem Holdings, Inc. (NYSE MKT: INFU) ("InfuSystem" or the "Company"), the leading national provider of infusion pumps and related services for the healthcare industry in the United States, today reported results for the first quarter ended March 31, 2012.

Revenues for the quarter ending March 31, 2012 were $14.3 million, up 11% from $13.0 million in the first quarter of 2011.  Gross profit for the three months ending March 31, 2012 was $10.4 million, up 15% from $9.1 million in first quarter of last year. First quarter net loss was $0.9 million, equal to $0.04 loss per diluted share, compared to $0.2 million net loss, equal to $0.01 income per diluted share in the prior period.

Ryan Morris, the newly appointed Executive Chairman, said the first quarter results provide a solid foundation for the new management team that took office in late April, and whose strategy for achieving growth and increasing shareholder value should begin to be reflected in subsequent quarterly results.  Since mid-March, the Company has welcomed the arrival of Interim Chief Executive Officer Dilip Singh, Chief Financial Officer Jonathan P. Foster, as well as five new Board members.

"It's been a very eventful quarter for the Company and I am proud that our employees and operational management continued the top line revenue growth while these Board and management changes took place," Morris said.

The new management team has already begun building on those efforts, starting first with a series of operational improvements, integration of past acquisitions to generate new synergies for the Company and cost-savings initiatives – some of which will be announced soon and some of which are already underway.

Interim Chief Executive Officer Dilip Singh said these operational improvements are just the first steps the Company will implement as part of a broader strategy to achieve long-term growth. "Our initial focus is to maximize cash generation with EBITDA for sustained financial stability while achieving growth by continuing to take market share in our core markets. Over the long-term, we see significant, recurring opportunity for organic growth, notably by enhancing customer service solutions that make it easier for our various partners, channels and customers to rent, lease or buy new and reconditioned pumps with just in time inventory; entering other vertical medical markets disciplines; and, in time, expanding our franchise model globally."

Operating Results

The 11% increase in revenues relative to the first quarter of 2011 is primarily related to the addition of new customers with larger patient bases, increased penetration into our existing customer accounts and the resolution of the oncology drug shortage affecting certain products.

The $10.4 million in gross profit recorded in the first quarter of 2012 represented 73% of revenues for the current period compared with 70% percent in the prior year's period. The increase in the gross margin percentage was primarily related to lower pump depreciation and a higher mix of third party billings as compared to pump sales, rentals and services.

Selling, general and administrative expenses (SG&A) for the first quarter of fiscal 2012 were $10.9 million, 24 percent higher than the prior period's $8.8 million. As a percent of revenues, SG&A was 76 percent compared to 62 percent for the prior fiscal year (excluding non-cash impairment charges).  The major factors contributing to the increase of $2.1 million in SG&A were expenses of $1.5 million related primarily to legal fees and other costs associated with activities related to negotiating and entering into a settlement agreement with a concerned stockholder group and a fifth amendment to the Company's credit facility. The settlement agreement and fifth amendment to the credit facility are described in the 8-K the Company filed on April 26th.  Additional related fees and expenses are expected in the second quarter of 2012.

EBITDA for the first quarter of fiscal 2012 was $1.6 million compared to $2.4 million a year ago.  Excluding the one-time fees associated with the activities described above, EBITDA would have been $3.1 million. A Non-GAAP reconciliation from net income can be found in the appendix.

Financial Condition

Net cash provided by operations for the first quarter ending March 31, 2012 was $0.1 million, compared to $2.1 million in the prior period.  The latest quarter's results reflected increased professional fees associated with the concerned stockholder group and employee compensation costs.  In addition, the Company reported capital expenditures of $1.2 million, a decrease of $1.2 million compared to the prior period.  The cash balance decreased by $3.2 million from the comparable period in the prior year due to issues noted herein and the Company ended the quarter with no cash on the balance sheet due to outstanding payments.  The Company had $2.5 million drawn as of March 31, 2012, on its $5.0 million revolving credit facility.   During the quarter, the Company continued to make the required payments on its $21.0 million in long-term debt.

Conference Call

The Company will host a conference call to share the results of its first quarter fiscal 2012 results on Tuesday, May 22, at 9:00 a.m. Eastern TimeDilip Singh, Interim Chief Executive Officer, and Jonathan P. Foster, Chief Financial Officer, will discuss the Company's financial performance and answer questions from the financial community.

The Company invites interested investors to listen to the presentation, which will be carried live on the Company's Web site: www.infusystem.com in the Investors section.  To participate by telephone, the dial-in number is (888)-895-5271 with confirmation number 32474314.  Those who wish to listen should either dial in or go to the web site several minutes prior to the call to register.  An online archive of the conference call will remain on the Company's Web site for the following 30 days.

About InfuSystem Holdings, Inc.

InfuSystem Holdings, Inc. is the leading provider of infusion pumps and related services to hospitals, oncology practices and other alternate site healthcare providers.  Headquartered in Madison Heights, Michigan, the Company delivers local, field-based customer support and also operates Centers of Excellence in Michigan, Kansas, California, and Ontario, Canada.  The Company's stock is traded on the NYSE MKT under the symbol INFU.

Forward-Looking Statements

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements.  These risks and uncertainties include general economic conditions, as well as other risks, detailed from time to time in the Company's publicly filed documents.

Additional information about InfuSystem Holdings, Inc. is available at www.infusystem.com.

INVESTOR CONTACT:
Jonathan P. Foster
Chief Financial Officer

Info@InfuSystem.com
800-962-9656

FINANCIAL TABLES FOLLOW







INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)








March 31,

December 31,

(in thousands, except share data)

2012

2011




ASSETS



Current Assets:



           Cash and cash equivalents

$       -

$              799

           Accounts receivable, less allowance for doubtful accounts of $2,021 and



                 $1,773 at March 31, 2012 and December 31, 2011, respectively

8,320

7,350

           Accounts receivable - related party

3

98

           Inventory

3,918

3,217

           Prepaid expenses and other current assets

874

934

           Deferred income taxes

681

682




                      Total Current Assets

13,796

13,080

Property & equipment, net

14,864

15,764

Deferred debt issuance costs, net

367

421

Intangible assets, net

27,597

28,221

Deferred income taxes

18,497

18,187

Other assets

509

590




           Total Assets

$    75,630

$          76,263




LIABILITIES AND STOCKHOLDERS' EQUITY



Current Liabilities:



           Accounts payable

$     3,180

$            4,004

           Accounts payable - related party

-

59

           Other current liabilities

2,376

2,235

           Derivative liabilities

256

258

           Current portion of long-term debt

6,303

6,576




                      Total Current Liabilities

12,115

13,132

Revolving credit facility

2,500

-

Long-term debt, net of current portion

21,008

22,551

Other liabilities

470

415




          Total Liabilities

$    36,093

$          36,098




Stockholders' Equity:



Common stock, $.0001 par value; authorized 200,000,000 shares; 

   issued 21,330,235 and 21,330,235, respectively; outstanding 21,132,545 

   and 21,132,545, respectively



2

2

Additional paid-in capital

87,827

87,541

Accumulated other comprehensive loss

(135)

(136)

Retained deficit

(48,157)

(47,242)




Total Stockholders' Equity

$    39,537

$          40,165




          Total Liabilities and Stockholders' Equity

$    75,630

$          76,263













  











INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF OPERATIONS


(UNAUDITED)













(in thousands, except share data)

2012

2011








Net revenues





Rentals

$     12,905

$     11,589



Product sales

1,443

1,368








Total revenues

14,348

12,957








Cost of revenues:





           Cost of revenues — Product, service and supply costs

2,235

2,143



           Cost of revenues — Pump depreciation, sales and disposals 

1,677

1,761



 Gross profit

10,436

9,053








Selling, general and administrative expenses:





           Provision for doubtful accounts

1,247

1,222



           Amortization of intangibles

684

645



           Asset impairment charges

-

-



           Selling and marketing

2,745

2,442



           General and administrative

6,273

4,517








                      Total sales, general and administrative

10,949

8,826








Operating (loss) income 

(513)

227








Other income (expense):





           Interest expense

(601)

(541)



           Other income (expense)

2

(3)








                      Total other loss

(599)

(544)








Loss before income taxes

(1,112)

(317)



Income tax benefit

197

146








Net loss

$        (915)

$        (171)








Net loss per share:





                                 Basic and diluted

$       (0.04)

$       (0.01)



Weighted average shares outstanding:





                                 Basic and diluted

21,132,545

21,012,312








Comprehensive Loss





Net loss

$        (915)

$        (171)



Unrealized gain on interest rate swap, net of taxes

1

47



Comprehensive Loss

$        (914)

$        (124)



  







INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)





Three Months Ended


March 31

(in thousands)

2012

2011




OPERATING ACTIVITIES



Net loss

$ (915)

$  (171)

Adjustments to reconcile net loss to net cash provided by 



    operating activities:



           Provision for doubtful accounts

1,247

1,222

           Depreciation

1,445

1,558

           Loss on disposal of pumps

151

271

           Amortization of intangible assets

684

645

           Amortization of deferred debt issuance costs

54

62

           Stock-based compensation

341

248

           Deferred income taxes

(310)

(146)

Changes in Assets  - (Increase)/Decrease:



           Accounts receivable, net of provision

(2,122)

(1,599)

           Other current assets

(641)

195

           Other assets

302

(11)

Changes in Liabilities  - Increase/(Decrease), exclusive of effects of acquisitions:



           Accounts payable and other liabilities

(149)

(152)




NET CASH PROVIDED BY OPERATING ACTIVITIES

87

2,122




INVESTING ACTIVITIES



           Capital expenditures

(1,207)

(2,438)

           Acquisition of intangible assets

(66)

-




NET CASH USED IN INVESTING ACTIVITIES

(1,273)

(2,438)




FINANCING ACTIVITIES



           Principal payments on term loan and seller's note

(1,217)

(1,030)

Proceeds from draw on revolving credit facility

2,500

-

           Treasury shares repurchased

-

(229)

           Principal payments on capital lease obligations

(896)

(263)







NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

387

(1,522)




Net change in cash and cash equivalents

(799)

(1,838)

Cash and cash equivalents, beginning of period

799

5,014




Cash and cash equivalents, end of period

$       -

$ 3,176




  













INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES



NON-GAAP RECONCILIATION



(UNAUDITED)
















Three Months Ended




March 31 (unaudited)



(in thousands, except share data)

2012


2011









Net loss

$    (915)


$    (171)



Adjustments:






  Interest expense

601


541



  Income tax benefit

(197)


(146)



  Depreciation

1,445


1,558



  Amortization

684


645



EBITDA

1,618


2,427

































SOURCE InfuSystem Holdings, Inc.