InfuSystem Holdings Reports 29% Revenue Increase and $3.9 Million of Adjusted EBITDA for the Third Quarter of 2010
MADISON HEIGHTS, MI--(Marketwire - November 9, 2010) - InfuSystem Holdings, Inc. (
Revenue for the third quarter ended September 30, 2010 was $12.7 million, a 29% improvement compared to $9.9 million for the same period in 2009. The increase in revenue was predominantly the result of the maturation of new accounts signed during the past several months combined with continued growth of new customers gained during the period and the continued strong performance of the First Biomedical division.
Mr. Sean McDevitt, Chief Executive Officer, commented, "We were very pleased with another record quarter for InfuSystem Holdings, which represents twelve straight quarters of year-over-year growth for our company. Our third quarter growth, which represents impressive contributions from both our consignment pump business and First Biomedical, shows that the broader service offering has been well received by our customers resulting in early success in terms of cross-selling. Going forward we expect continued solid organic growth and continued cross-selling benefits, compounded by strategic complementary acquisitions where we can leverage our strong relationships and distribution channel. We are well on our way to achieving our goal of becoming the leading company in the infusion services market."
Financial Results for the Third Quarter 2010
Revenue for the third quarter ended September 30, 2010 was $12,733,000, a 29% improvement compared to $9,902,000 for the same period in 2009. Operating income for the third quarter of 2010 was $828,000 compared to $1,363,000 for the same period in 2009. The decrease in operating income was primarily due to costs related to the recent First Biomedical acquisition, higher selling expenses, and higher non-cash stock-based compensation expenses. The net income for the third quarter of 2010 was $174,000 or $0.01 per diluted share, compared to net loss of ($445,000) or ($0.02) per diluted share, for the same period in 2009. The net income for the third quarter of 2010 included a $250,000 gain on derivative financial instruments compared to a ($564,000) loss on derivative financial instruments in the third quarter of 2009.
Adjusted EBITDA for the third quarter ended September 30, 2010 was $3,933,000, a 4% improvement compared to $3,765,000 for the same period in 2009. The increase in EBITDA for the third quarter of 2010 was primarily due to higher gross profit, partially offset by higher selling expenses. The Company defines Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, and excludes gain (loss) on derivative financial instruments and stock-based compensation, and other non-recurring charges. Adjusted EBITDA is not a measure of performance calculated in accordance with generally accepted accounting principles in the United States ("GAAP"). The Company believes the presentation of Adjusted EBITDA is a relevant and useful measure to assist a reader's ability to understand the Company's operating performance. The Company's management likewise utilizes Adjusted EBITDA as a means to measure its operating performance. Reconciliation from Adjusted EBITDA, a non-GAAP measure, to net income can be found in the appendix.
Total cash and cash equivalents were $4,692,000 at the end of the third quarter, compared to $7,750,000 at the end of 2009. As of September 30, 2010, InfuSystem had $33,475,000 of debt outstanding, compared to $24,141,000 at year end 2009. Both the decrease in cash and the increase in debt, as compared to year end 2009, are primarily related to the acquisition of First Biomedical and the refinancing of the Company's debt, partially offset by continued strong operating cash flows. The Company also had a $5,000,000 revolving credit facility in place at September 30, 2010.
Conference Call
The company will host an investor conference call today at 5:00 p.m. ET to discuss its financial results for the third quarter 2010. The investor conference call will be available via live webcast on InfuSystem's website at www.infusystem.com in the Investors section. To participate by telephone, the dial-in number is (888) 637-7725. The access code is 4874415. Investors are advised to dial into the call at least ten minutes prior to the call to register. A replay of the call can be accessed by dialing (888) 203-1112, confirmation number 4874415. An online archive of the conference call will remain on the Company's website for at least 90 days after the call.
About InfuSystem Holdings, Inc.
InfuSystem is the leading provider of infusion pumps and related services. InfuSystem services hospitals, oncology practices and other alternate site healthcare providers. Headquartered in Madison Heights, Michigan, InfuSystem delivers local, field-based customer support, and also operates Centers of Excellence in Michigan, Kansas, California, and Ontario, Canada.
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 InfuSystem's publicly filed documents.
INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
(in thousands, except share data) 2010 2009
------------- --------------
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 4,692 $ 7,750
Accounts receivable, less allowance for
doubtful accounts of $1,785 and $1,842
at September 30, 2010 and December 31,
2009, respectively 7,348 5,517
Inventory 1,457 925
Prepaid expenses and other current
assets 492 395
Deferred income taxes 357 125
------------- --------------
Total Current Assets 14,346 14,712
Property & equipment, net 17,154 13,499
Deferred debt issuance costs, net 723 781
Goodwill 63,983 56,580
Intangible assets, net 33,588 28,911
Other assets 249 207
------------- --------------
Total Assets $ 130,043 $ 114,690
============= ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 2,177 $ 1,306
Other current liabilities 2,201 1,573
Derivative liabilities 785 2,670
Current portion of long-term debt 5,336 5,501
------------- --------------
Total Current Liabilities 10,499 11,050
Long-term debt, net of current portion 28,139 18,640
Deferred income taxes 5,649 3,314
Other Liabilities 512 221
------------- --------------
Total Liabilities $ 44,799 $ 33,225
------------- --------------
Commitments and Contingencies -- --
Stockholders' Equity
Preferred stock, $.0001 par value: authorized
1,000,000 shares; none issued -- --
Common stock, $.0001 par value; authorized
200,000,000; shares; issued and outstanding
19,941,095 and 18,734,144, respectively 2 2
Additional paid-in capital 85,067 81,410
Accumulated other comprehensive loss (183) --
Retained earnings 358 53
------------- --------------
Total Stockholders' Equity 85,244 81,465
------------- --------------
Total Liabilities and Stockholders'
Equity $ 130,043 $ 114,690
============= ==============
INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ----------------------
(in thousands, except per
share data) 2010 2009 2010 2009
---------- ---------- ---------- ----------
Net revenues $ 12,733 $ 9,902 $ 34,154 $ 28,302
Operating expenses:
Cost of Revenues --
Product, service and
supply costs 2,130 1,793 5,524 4,447
Cost of Revenues --
Pump depreciation,
sales and disposals 1,706 993 4,094 2,727
Provision for doubtful
accounts 986 890 3,454 2,734
Amortization of
intangibles 624 456 1,615 1,370
Selling and marketing 1,702 1,201 4,739 3,749
General and
administrative 4,757 3,206 12,662 9,307
---------- ---------- ---------- ----------
Total Operating
Expenses 11,905 8,539 32,088 24,334
---------- ---------- ---------- ----------
Operating income 828 1,363 2,066 3,968
Other loss:
Gain (loss) on
derivatives 250 (564) (210) (1,200)
Interest expense (609) (831) (2,781) (2,668)
Gain on extinguishment
of long-term debt -- -- 1,118 --
---------- ---------- ---------- ----------
Total other loss (359) (1,395) (1,873) (3,868)
---------- ---------- ---------- ----------
Income (loss) before income
taxes 469 (32) 193 100
Income tax (expense)
benefit (295) (413) 112 (292)
---------- ---------- ---------- ----------
Net income (loss) $ 174 $ (445) $ 305 $ (192)
========== ========== ========== ==========
Net income (loss) per
share:
Basic 0.01 (0.02) 0.02 (0.01)
Diluted 0.01 (0.02) 0.01 (0.01)
Weighted average shares
outstanding:
Basic 19,904,648 18,645,911 19,539,326 18,581,917
Diluted 21,647,904 18,645,911 20,742,765 18,581,917
INFUSYSTEM HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Ended
September 30
----------------------------
(in thousands) 2010 2009
------------- -------------
OPERATING ACTIVITIES
Net Income $ 305 $ (192)
Adjustments to reconcile net income to net
cash provided by operating activities:
Loss on derivative liabilities 210 1,200
Gain on extinguishment of long-term debt (1,118) --
Provision for doubtful accounts 3,454 2,734
Depreciation and loss on disposal of
pumps 4,379 3,250
Amortization of intangible assets 1,615 1,370
Amortization of deferred debt issuance
costs 915 382
Stock-based compensation 1,811 529
Deferred income taxes (519) 787
Changes in assets and liabilities, exclusive
of effects of acquisitions:
Increase in accounts receivable, net of
provision (3,556) (4,157)
Increase in other current assets (89) (632)
Decrease in other assets 170 --
Increase in accounts payable and other
liabilities 553 1,803
Decrease in derivative liabilities from
termination of interest rate swap (365) --
------------- -------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 7,765 7,074
------------- -------------
INVESTING ACTIVITIES
Capital expenditures (1,392) (4,039)
Cash paid for acquisition, net of cash
acquired (16,418) --
Proceeds from sales of property -- 1
Other assets -- (18)
------------- -------------
NET CASH USED IN INVESTING ACTIVITIES (17,810) (4,056)
------------- -------------
FINANCING ACTIVITIES
Principal payments on term loan (21,596) (7,747)
Cash proceeds from term loan 30,000 --
Capitalized debt issuance costs (808) --
Common stock repurchased to satisfy
statutory withholding on Stock-based
compensation (38) --
Principal payments on capital lease
obligation (571) (68)
------------- -------------
NET CASH PROVIDED BY (USED IN) FINANCING
ACTIVITIES 6,987 (7,815)
------------- -------------
Net change in cash and cash equivalents (3,058) (4,797)
Cash and cash equivalents, beginning of
period 7,750 11,513
------------- -------------
Cash and cash equivalents, end of period 4,692 6,716
============= =============
INFUSYSTEM HOLDINGS, INC.
GAAP RECONCILIATION
(UNAUDITED)
Reconciliation from Net Income to Adjusted EBITDA:
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ----------------------
2010 2009 2010 2009
---------- ---------- ---------- ----------
Net Income (loss) $ 174 $ (445) $ 305 $ (192)
Adjustments:
Interest expense 609 831 2,781 2,668
Income tax expense
(benefit) 295 413 (112) 292
Depreciation 1,487 1,085 3,869 2,971
Amortization 624 456 1,615 1,370
---------- ---------- ---------- ----------
EBITDA $ 3,189 $ 2,340 $ 8,458 $ 7,109
---------- ---------- ---------- ----------
Adjustments:
(Gain) loss on
derivatives (250) 564 210 1,200
Stock based compensation 814 (16) 1,811 529
Acquisition costs 180 - 965 -
Termination benefits - 877 - 877
Gain on debt
extinguishment - - (1,118) -
---------- ---------- ---------- ----------
Adj. EBITDA $ 3,933 $ 3,765 $ 10,326 $ 9,715
========== ========== ========== ==========
CFO
InfuSystem
(248) 291-1210
Investor Contacts:
Asher Dewhurst
Bob East
Westwicke Partners
Email Contact
Tel: (443) 213-0500
Released November 9, 2010
