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BASKING RIDGE, N.J., April 22, 1999 -- Hooper Holmes, Inc. (Amex: HH) today reported record results for the first quarter ended March 31, 1999. Revenue for the first quarter of 1999 rose 15% to $52.9 million from $46.1 million in the first quarter of last year. Net income grew at a significantly higher rate of 49% to $4.8 million over the $3.2 million reported in the comparable quarter last year. Diluted earnings per share increased 45% to $0.16 from the $0.11 reported for the first quarter of 1998. The Company stated that revenue growth for the quarter reflects increased overall unit volume resulting from growing demand for larger life insurance policies and an additional number of tests and services being performed per exam. Additionally the Company experienced an enhanced market share due to Hooper Holmes' competitive state-of-the-art technology and networking service capabilities. The Company continued to successfully execute its business model by further leveraging its infrastructure. First quarter cost of operations improved by 80 basis points over the comparable quarter last year to 67.8% and selling, general and administrative expenses as a percentage of sales was just over 16%, a 240 basis point improvement ove
last year's first quarter. The Company also stated that operating income for the quarter rose to $8.5 million, from the $5.9 million reported in last year's first quarter. Jim McNamee, Chairman and Chief Executive Officer, stated, ``Overall, 1999 is off to a great start. This quarte
marks the highest percentage year-over- year top line growth in the modern history of our 100-year-old Company and reflects the growing demand for our services. Our investments in state-of- the-art computer and networking technology combined with our nationwide presence have led to lower costs and greater efficiencies and, importantly, enable Hooper Holmes to provide unsurpassed service to our clients in the life and health insurance industry.'' ``We are particularly pleased with the progress of Heritage Labs, our majority owned clinical reference laboratory, which reached its break even annual revenue run rate several months earlier than anticipated,'' Mr. McNamee added. ``This accomplishment increases our confidence that we can grow the laboratory testing services business and furthe
leverage Hooper Holmes' service capabilities to the life and health insurance industry and related markets.'' Mr. McNamee, concluded, ``We continue to be optimistic about the internal growth opportunities that lie ahead ove
the course of the year and beyond. At the same time, with our strong cash flow and solid balance sheet, we continue to look for accretive acquisition opportunities that complement our core business.'' Hooper Holmes, Inc. provides medical and other underwriting information on insurance policy applicants to the majo
companies in the life and health insurance industry. The Company provides these health information services through its 200 locations nationwide. Certain information contained herein includes information that is forward-looking. The matters referred to in forward-looking statements may be affected by the risks and uncertainties involved in the Company's business. These forward-looking statements are qualified in the entirety by cautionary statements contained in the Company's Securities and Exchange Commission filings. *T HOOPER HOLMES, INC. CONSOLIDATED STATEMENT OF INCOME (in thousands, except share and per share amounts) Three Months ended March 31, 1999 1998 Revenues $52,939 $46,111 Cost of Operations 35,890 31,614 Gross profit 17,049 14,497 Selling, general and administrative expenses 8,570 8,578 Operating income 8,479 5,919 Other income (expense) Interest expense (10) - Interest income 206 129 Other 3 (38) 199 91 Income before income taxes 8,678 6,010 Income taxes 3,927 2,821 Net income 4,751 3,189 Net Income per share: Basic $0.17 $0.11 Diluted $0.16 $0.11 Weighted average numbe
of shares: Basic 28,391,733 27,925,210 Diluted 30,284,656 29,502,829 *T Note: Per share calculations are adjusted to reflect a two for one stock split effective January 29, 1999. *T HOOPER HOLMES, INC. CONSOLIDATED BALANCE SHEET March 31, December 31, 1999 1998 ASSETS Current Assets: Cash and cash equivalents $ 30,762,678 $29,752,361 Accounts receivable - trade 24,287,055 17,783,256 Accounts receivable - other 279,006 362,600 Escrow funds 0 0 Refundable income taxes 7,408 7,408 Other current assets 5,562,090 5,388,795 Total current assets 60,898,237 53,294,419 Property, plant and equipment: Land and land improvements 591,213 591,213 Building 4,236,358 4,236,358 Furniture, fixtures and equipment 17,952,514 17,345,110 Leasehold improvements 315,478 314,545 Total property, plant and equipment 23,095,563 22,487,225 Less: Accumulated depreciation 14,621,821 14,166,163 Net property, plant and equipment 8,473,742 8,321,062 Cost in excess of net assets of acquired companies 16,229,548 16,398,245 Intangible assets 6,409,911 6,728,112 Other assets 411,365 274,548 Total assets $ 92,422,803 $ 85,016,385 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current maturities of long term debt $450,000 $450,000 Accounts payable 7,970,144 6,606,518 Accrued expenses: Insurance benefits 1,623,655 1,662,747 Salaries, wages and fees 844,211 2,356,582 Payroll and other taxes 286,710 204,893 Income taxes payable 5,243,640 3,315,758 Discontinued operations 2,656,579 2,845,007 Other 1,570,607 2,377,001 Total current liabilities 20,645,546 19,818,506 Long term debt, less current maturities 0 0 Deferred income taxes 2,349,858 2,518,487 Minority interest 345,194 385,441 Common stock 1,146,265 1,135,199 Additional paid-in capital 31,895,405 29,515,099 Retained earnings 37,013,175 32,616,294 70,054,845 63,266,592 Less: Treasury stock 972,640 972,640 Total stockholders' equity 69,082,205 62,293,951 Total liabilities and stockholders' equity $92,422,803 $85,016,385 *T
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