Orion HealthCorp, Inc. (AMEX: ONH) today announced its financial
results for the second quarter and six months ended June 30, 2007.
Terrence L. Bauer, chief executive officer of Orion HealthCorp,
said, �We continue to make progress as we strive to achieve our
goal of becoming a leading multi-regional physician billing,
collections, practice management and revenue cycle management
company. We are working diligently to improve existing operations
and create organic growth, while maintaining fiscal discipline and
evaluating value-added acquisitions. We are particularly focused on
the cost savings and operating efficiency opportunities available
to us as a result of the acquisitions completed in December. We are
optimistic about the remainder of the year.� For the three months
ended June 30, 2007, net operating revenues were $8.2 million, a
55.1% increase over the $5.3 million for the same period in the
prior year. Loss from continuing operations for the second quarter
of 2007 was $904,000, or $0.01 per basic share, compared with a
loss from continuing operations of $619,000, or $0.05 per basic
share, for the second quarter of 2006. Net income, including income
from discontinued operations of $1.0 million, was $116,000 for the
second quarter of 2007 compared with a net loss, including income
from discontinued operations of $139,000, of $480,000 for the
second quarter of 2006. Earnings before interest, taxes,
depreciation and amortization (EBITDA) were $162,000 for the second
quarter of 2007 as compared with an EBITDA loss of $92,000 for the
second quarter ended June 30, 2006. (A reconciliation of EBITDA to
net income for the second quarter and six months ended June 30,
2007 is provided on the attached unaudited consolidated condensed
statements of operations.) For the six months ended June 30, 2007,
net operating revenues were $16.5 million, a 51.3% increase over
the $10.9 million for the same period in the prior year. Loss from
continuing operations for the first half of 2007 was $1.7 million
or $0.02 per basic share, compared with a loss from continuing
operations of $551,000, or $0.04 per basic share, for the first
half of 2006. Net loss, including income from discontinued
operations of $1.0 million, was $670,000, or $0.01 per basic share,
compared with net income, including income from discontinued
operations of $842,000, of $291,000, or $0.03 per basic share, for
the first half of 2006. EBITDA totaled $394,000 for the first six
months of 2007 compared with an EBITDA loss of $166,000 for the
prior year period. The results for the quarter and six months ended
June 30, 2007, included revenues and expenses for Rand Medical
Billing and the On Line companies, which the Company acquired in
December 2006. In addition, results for the three months and six
months ended June 30, 2007 and 2006, respectively, include the
consolidated results of Orion HealthCorp, including its two
reportable segments: Practice Management, which provides business
and management services to pediatric physician groups, and Revenue
Cycle Management, which provides physician billing and collection
services and practice management solutions, primarily to
hospital-based physicians. The surgery center business operated
under the name �SurgiCare� and certain assets of Integrated
Physician Solutions (IPS) are reported as discontinued operations
for the three months and six months ended June�30, 2007 and 2006.
Certain reclassifications have been made in the 2006 financial
statements to conform to the reporting format in 2007. Such
reclassifications had no effect on previously reported earnings. In
addition, the second quarter 2006 financial statements were
restated to reflect operations discontinued subsequent to the
second quarter of 2006. In closing, Mr. Bauer added, �Although we
are disappointed by the fact that EBITDA in the second quarter of
2007 was lower than EBITDA in the first quarter of the year, we
have confidence in our strategy and in the markets we serve. The
demand for our services is growing in a healthcare sector that
continues to be stressed by reimbursement reductions and cost
pressures. Also, there are barriers to entry that we have overcome,
further distancing ourselves from current and potential
competitors. Our experience with physicians and reputation for
creating value for their practices set us apart. It is a
relationship business, and we have years of experience developing
and maintaining these critical physician partnerships.� The live
broadcast of Orion HealthCorp�s second quarter conference call will
begin at 11:00 a.m. Eastern Time on Friday, August 10, 2007. An
online replay of the call will be available for 30 days following
the conclusion of the live broadcast. A link for these events can
be found on the Company�s website at www.orionhealthcorp.com or at
www.earnings.com. Orion�s mission is to provide superior billing,
collections, practice, business and financial management services
for physicians, resulting in optimal profitability for its clients
and increased enterprise value for its stakeholders. For more
information on Orion HealthCorp, Inc., visit the Company�s website
at www.orionhealthcorp.com. Certain statements in this press
release constitute �forward-looking statements� within the meaning
of the Securities Act of 1933, as amended, and the Securities
Exchange Act of 1934, as amended (the �Acts�). Any statements
contained herein that are not statements of historical fact are
deemed to be forward-looking statements, including all statements
regarding improving financial metrics and future growth. The
forward-looking statements in this press release are based on
current beliefs, estimates and assumptions concerning the
operations, future results, and prospects of Orion HealthCorp, Inc.
and the other companies described herein. As actual operations and
results may materially differ from those assumed in forward-looking
statements, there is no assurance that forward-looking statements
will prove to be accurate. Forward-looking statements are subject
to the safe harbors created in the Acts. Any number of factors
could affect future operations and results, including without
limitation, changes in federal or state healthcare laws and
regulations and third party payer requirements, changes in costs of
supplies, the loss of major customers, increases in labor and
employee benefit costs, increases in interest rates on the
Company�s indebtedness as well as general market conditions,
competition and pricing, and the Company�s ability to successfully
implement its business strategies and integrate acquisitions,
including the expense and impact of any potential acquisitions and
the ability to obtain necessary approvals and financing. Orion
HealthCorp, Inc. undertakes no obligation to update publicly any
forward-looking statements, whether as a result of new information
or future events. ORION HEALTHCORP, INC. Unaudited Consolidated
Condensed Statements of Operations (in thousands, except per share
amounts) � Three Months Ended Six Months Ended June 30, June 30, �
2007 � � 2006 � � 2007 � � 2006 � � Net operating revenues $ 8,161
$ 5,263 $ 16,445 $ 10,872 Operating expenses � 8,708 � � 5,759 � �
17,468 � � 11,845 � � Loss from continuing operations before other
income (expense) (547 ) (496 ) (1,023 ) (973 ) Other income
(expense), net � (357 ) � (123 ) � (697 ) � 422 � Loss from
continuing operations (904 ) (619 ) (1,719 ) (551 ) Income from
operations of discontinued components � 1,020 � � 139 � � 1,050 � �
842 � Net income (loss) $ 116 � $ (480 ) $ (670 ) $ 291 � �
Weighted average common shares outstanding: Basic 105,503 12,591
105,498 12,510 Diluted 105,503 12,591 105,498 89,319 � Income
(loss) per share: Basic Net loss per share from continuing
operations $ (0.01 ) $ (0.05 ) $ (0.02 ) $ (0.04 ) Income per share
from discontinued operations � 0.01 � � 0.01 � � 0.01 � � 0.07 �
Net income (loss) per share $ 0.00 � $ (0.04 ) $ (0.01 ) $ 0.03 � �
Diluted Net loss per share from continuing operations $ (0.01 ) $
(0.05 ) $ (0.02 ) $ (0.01 ) Income per share from discontinued
operations � 0.01 � � 0.01 � � 0.01 � � 0.01 � Net income (loss)
per share $ 0.00 � $ (0.04 ) $ (0.01 ) $ 0.00 � � Reconciliation of
EBITDA to net income (loss): EBITDA $ 162 $ (92 ) $ 394 $ (166 )
Less: Depreciation and amortization (709 ) (404 ) (1,417 ) (808 )
Less: Total other income (expenses), net (357 ) (123 ) (697 ) 423
Less: Income from operations of discontinued components � 1,020 � �
139 � � 1,050 � � 842 � Net income (loss) $ 116 � $ (480 ) $ (670 )
$ 291 � ORION HEALTHCORP, INC. Consolidated Condensed Balance
Sheets (in thousands, except share amounts) � June 30, Dec. 31,
2007 2006 (Unaudited) Current assets: Cash and cash equivalents $
277 $ 644 Accounts receivable, net 3,508 3,575 Inventory 251 278
Prepaid expenses and other current assets 577 407 Assets held for
sale � -- � � 502 � Total current assets 4,613 5,406 � Property and
equipment, net 617 711 � Other long-term assets: Intangible assets,
including goodwill, net 21,097 22,158 Other assets, net � 2,643 � �
1,908 � Total other long-term assets � 23,740 � � 24,066 � Total
assets $ 28,970 � $ 30,183 � � Current liabilities: Accounts
payable and accrued expenses $ 6,219 $ 6,938 Current portion of
capital lease obligations and long-term debt 2,363 1,847 Current
portion of long-term debt held by related parties 850 325
Liabilities held for sale � -- � � 159 � Total current liabilities
� 9,432 � � 9,269 � � Long-term liabilities: Capital lease
obligations and long-term debt, net of current portion 6,663 6,989
Long-term debt, net of current portion, held by related parties �
3,969 � � 4,541 � Total long-term liabilities � 10,632 � � 11,530 �
� Stockholders' equity: Preferred stock, par value $0.001;
20,000,000 shares authorized; no shares issued and outstanding --
-- Common stock, Class A, par value $0.001; 300,000,000 shares
authorized and 105,504,032 and 105,374,487 shares issued and
outstanding at June 30, 2007 and December 31, 2006, respectively
105 105 Common stock, Class D, par value $0.001; 50,000,000 shares
authorized and 24,658,955 shares issued and outstanding at June 30,
2007 and December 31, 2006 25 25 Additional paid-in capital 64,068
63,876 Accumulated deficit (55,254 ) (54,584 ) Treasury stock - at
cost; 9,140 shares � (38 ) � (38 ) Total stockholders' equity �
8,906 � � 9,384 � Total liabilities and stockholders' equity $
28,970 � � 30,183 �
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