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BASKING RIDGE, N.J., Feb. 26 -- Hooper Holmes, Inc. (Amex: HH) today reported results for the fourth quarter and year-ended December 31, 2000.
For the year 2000, revenue increased 16% to $275.0 million from $237.1 million reported in the prior year. Operating income for 2000 was $32.6 million compared to the $36.5 million reported for 1999. Net income rose to $21.0 million over $20.8 million last year. Earnings per diluted share were $0.31 versus $0.34 in 1999.
Revenue for the fourth quarter of 2000 was $60.3 million compared to $75.8 million in the fourth quarter of 1999. Operating income was $6.0 million compared to $11.3 million reported for the fourth quarter last year. Net income was $4.5 million, or $0.07 per diluted share, versus $6.2 million, or $0.10 per diluted share, reported for the comparable period last year.
Jim McNamee, Chairman and Chief Executive Officer, commented, "2000 was a year of challenges and progress for Hooper Holmes. While the well-documented impact of the Triple X regulatory changes on the life insurance industry resulted in disappointing revenue and earnings for the last nine months of the year, we continued to execute our strategy of strengthening our position within the industry. Through the introduction of Portamedic Select and our equity investment in and marketing agreement with e-Nable.com, Hooper Holmes remains at the forefront of providing life insurance underwriters the tools necessary for transacting a new insurance policy quickly and efficiently. Our exclusive agreement with DNA Sciences leveraged one of our core strengths into a new market while our acquisition of California-based Exam Services, Inc., expanded our geographical presence into new territory. In addition, we expect to announce a new software licensing initiative shortly. We are confident that this progress will enable us to experience moderate revenue and operating earnings growth in the coming year."
"While 2000 was challenging," Fred Lash, Senior Vice President and Chief Financial Officer added, "we ended the year with nearly $21 million of net income, a record. Total assets increased $27 million to $211 million and our liquid assets increased from $41 million to $75 million, as debt decreased from $65 million to $3 million. We provided record cash from operations of $33.4 million versus $30.9 million in 1999. Trade accounts receivables declined from $34.5 million to $27.0 million. These are truly positive results in a challenging environment."
Mr. McNamee concluded, "In 2001, we intend to further strengthen our business by maximizing technological advances and by remaining focused on pursuing strategic opportunities, which we believe will allow us to simultaneously deliver value to both our customers and our shareholders. We strengthened our balance sheet and finished the year with $75 million in liquid assets and minimal debt, which will give us the flexibility to grow both organically and through acquisitions. With successful execution of this strategy in 2001, we expect to grow revenues for the year in the range of 8-10% and earnings per diluted share in the range of 18-22%."
Hooper Holmes will host a conference call today to discuss fourth quarter and year end results at 11:00 a.m. Eastern Time. The call will be broadcast live over the Internet. The broadcast will be accessible at the Company's website located at http://www.hooperholmes.com. In addition, an online archive of the broadcast will be available within two hours of the live call. Hooper Holmes, Inc. provides health information services on insurance policy applicants to the life insurance industry. The Company provides these health information services through over 300 locations nationwide.
This press release contains forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations contained in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove correct. These statements are based on current expectations and projections about future events, and are subject to certain risks and uncertainties that, individually or in the aggregate, could cause actual results to differ materially from those expressed in any forward-looking statements. These risks and uncertainties are beyond the ability of the Company to control or predict and include, but are not limited to, the following important factors: the demand for life insurance policies, and in turn, the demand for the Company's services; the ability to control costs; the impact of federal, state, and local regulatory requirements on the Company's business and on the life insurance industry; to the extent the Company seeks growth through acquisitions or other investments, the ability to identify, consummate and integrate these acquisitions or investments on satisfactory terms; the ability to develop new or advanced technologies and systems on a timely and cost-effective basis; product development; the impact of competition; and the uncertainty of economic conditions in general. Additional information concerning these risks and uncertainties is contained in the Company's filings with the Securities and Exchange Commission. The forward-looking statements contained in this release are made as of the date of this release, and the Company assumes no obligation to update or revise any forward-looking statements based on events that may occur after this date.
HOOPER HOLMES INC. & SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(in thousands, except share and per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
2000 1999 2000 1999
Revenues $60,349 $75,827 $274,974 $237,068
Cost of operations 43,814 52,775 197,347 163,958
Gross profit 16,535 23,052 77,627 73,110
Selling, general and
administrative
expenses 10,502 11,752 44,994 36,574
Operating income 6,033 11,300 32,633 36,536
Other income (expense)
Interest expense (69) (830) (1,291) (860)
Interest income 1,221 358 4,259 1,107
Other income (expense)
net 159 104 533 249
1,311 (368) 3,501 496
Income before income
taxes 7,344 10,932 36,134 37,032
Income taxes 2,829 4,700 15,170 16,239
Net income $4,515 $6,232 $20,964 $20,793
Earnings per share:
Basic $0.07 $0.11 $0.32 $0.36
Diluted $0.07 $0.10 $0.31 $0.34
Weighted average
number of shares:
Basic 65,735,882 58,164,864 64,830,697 57,560,564
Diluted 68,782,030 62,163,600 68,377,742 61,533,558
Note: Per share calculations are adjusted to reflect a two-for-one stock
split effective April 26, 2000.
Hooper Holmes, Inc.
Consolidated Balance Sheets
December 31, December 31,
2000 1999
(audited) (audited)
ASSETS
Current Assets:
Cash and cash equivalents $45,754,297 $41,363,019
Marketable securities 29,114,483 0
Accounts receivable 28,870,624 36,836,412
Other current assets 4,539,330 5,233,884
Total current assets 108,278,734 83,433,315
Property, plant and equipment: 27,382,480 26,465,947
Less: Accumulated depreciation 18,058,073 16,075,132
Net property, plant and equipment 9,324,407 10,390,815
Goodwill, net 78,815,845 73,276,965
Intangible assets, net 13,865,768 16,523,290
Other assets 751,128 846,943
Total assets $211,035,882 $184,471,328
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Note payable $196,836 $142,953
Accounts payable 7,402,862 11,543,665
Accrued expenses:
Insurance benefits 291,408 1,559,552
Salaries, wages and fees 2,585,457 3,209,031
Income taxes payable 902,721 5,033,946
Other 3,594,373 5,868,449
Total current liabilities 14,973,657 27,357,596
Long term debt, less current maturities 3,195,295 65,307,047
Deferred income taxes 1,708,954 1,911,027
Minority interest 81,355 203,962
Stockholders' equity:
Common stock, par value $.04 per share;
authorized 240,000,000 shares issued
67,454,174 in 2000, and 58,391,052 in
1999 2,698,167 2,335,642
Additional paid-in capital 135,419,195 36,357,092
Retained earnings 71,009,995 51,971,602
209,127,357 90,664,336
Less: Treasury stock at cost (1,993,564
and 208,664 shares) 18,050,736 972,640
Total stockholders' equity 191,076,621 89,691,696
Total liabilities and
stockholders' equity $211,035,882 $184,471,328
Note: 1999 share and per share amounts have been reclassified to reflect
a two-for-one stock split effective April 26, 2000.
Contacts:
Fred Lash, Chief Financial Officer
908-766-5000
Investors - Theresa Vogt, Sarah Torres
Media - Stacey Nield, Steve DiMattia
all of Morgen-Walke Associates, 212-850-5600
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