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BASKING RIDGE, N.J., Oct 31, 2005 -- Hooper Holmes, Inc. (HH) today reported its financial results for the third quarter and nine months ended September 30, 2005.
Total revenues for the quarter decreased 6% to $77.5 million compared to $82.4 million in the third quarter of 2004. Net loss was $2.5 million or $0.04 per diluted share compared to net income of $2.4 million or $0.04 per diluted share in the third quarter of the prior year. The third quarter 2005 operating income included an after tax charge of $.04 per diluted share related to costs associated with the previously announced departures of the Company's former President and Chief Executive Officer, and the Company's former Chief Financial Officer, in the third quarter, as well as the write-off of certain purchased business application software.
Third quarter 2005 revenues for the Company's Health Information Division (HID) were $68.3 million, a decrease of 3.7% compared to the $70.9 million reported in the third quarter 2004. Key factors influencing the HID's period- over-period operating results were:
-- A $5.4 million, or 12% decrease in Portamedic revenues to
$40.6 million, reflecting the continued decline in the Company's core
paramedical business
-- A $1.0 million, or 28% increase in Mid-America Agency Services (MAAS)
revenues to $4.5 million
-- A $0.3 million, or 3% increase in Medicals Direct, our UK subsidiary,
revenues to $10.7 million
-- A $0.6 million, or 15% increase in Heritage Labs revenues to
$4.7 million
-- A $0.8 million, or 12% increase in Infolink revenues to approximately
$7.9 million
Revenues for the Company's Claims Evaluation Division (CED) were $9.2 million, compared to $11.5 million, a decrease of 20%, from the third quarter of 2004. The decrease was primarily a result of reduced independent medical exam and peer review activity in New York State, where a substantial amount of the CED's revenue is generated.
For the nine months ended September 30, 2005, total revenues decreased 0.5% to $244.0 million from $245.3 million in last year's comparable period. Net income was $2.8 million, or $0.04 per diluted share, for the nine-month period ended September 30, 2005, compared to $8.8 million, or $0.13 per diluted share, in the first nine months of last year.
Benjamin A. Currier, Chairman and interim Chief Executive Officer of Hooper Holmes, stated, "The third quarter results reflect the continuing decline of our core paramedical business, which prompted our release on October 7th of revised revenue and earnings guidance for the full year of 2005. The management team and Board of Directors are committed to completing our reorganization and promptly improving our earnings performance, demonstrating to our customer base an improved quality and efficiency of our operations, and substantially reducing costs. We intend to leverage our employee resources, geographic reach, experience, industry relationships and products and services."
Mr. Currier added, "The Company's search for both a CEO and CFO are progressing and we will update the market when a decision has been made."
Hooper Holmes will host a conference call on Tuesday, November 1, 2005 to discuss third quarter results at 9:30 a.m. Eastern Time. The call will be broadcast live over the Internet, and is 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 until the next quarterly conference call.
Hooper Holmes provides outsourced risk assessment services to the life insurance industry through over 265 locations nationwide and in the United Kingdom, as well as claims evaluation information services to the automobile, and workers' compensation insurance industries.
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 involving the Company's business. These forward-looking statements are qualified in their entirety by cautionary statements contained in the Company's Securities and Exchange Commission filings. The Company disclaims any obligation to update these forward-looking statements.
HOOPER HOLMES INC.
2005 CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(unaudited)
Three Months ended Nine Months ended
September 30, September 30,
2005 2004 2005 2004
Revenues $77,548 $82,446 $244,019 $245,281
Cost of operations 59,302 59,161 178,810 176,079
Gross profit 18,246 23,285 65,209 69,202
Selling, general and
administrative expenses 22,317 19,260 60,167 54,405
Operating (loss) income (4,071) 4,025 5,042 14,797
Other income (expense):
Interest expense (147) (216) (493) (560)
Interest income 111 94 288 251
Other income, expense, net (126) (65) (353) (265)
(162) (187) (558) (574)
(Loss) Income before
income taxes (4,233) 3,838 4,484 14,223
Income tax (benefit) expense (1,742) 1,488 1,725 5,423
Net (loss) Income $(2,491) $2,350 $2,759 $8,800
Net (loss) income per share:
Basic $(0.04) $0.04 $0.04 $0.14
Diluted $(0.04) $0.04 $0.04 $0.13
Weighted average number of
shares:
Basic 65,527,594 65,032,457 65,351,112 64,965,666
Diluted 65,527,594 66,287,393 66,080,614 66,550,831
Hooper Holmes, Inc.
Consolidated Balance Sheets
(in thousands)
(unaudited)
09/30/2005 12/31/2004
ASSETS
Current Assets:
Cash and cash equivalents $12,188 $16,973
Marketable securities 2,172 6,886
Accounts receivable, net 44,962 42,001
Other current assets 7,117 7,242
Total current assets 66,439 73,102
Property, plant and equipment: 38,994 36,740
Less: Accumulated depreciation and
amortization 26,804 25,540
12,190 11,200
Goodwill 155,586 155,502
Intangible assets 31,447 35,380
Other assets 434 521
Total assets $266,096 $275,705
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term
debt $1,052 $1,067
Accounts payable 12,632 14,701
Accrued expenses:
Salaries, wages and fees 961 1,105
Income taxes payable 454 2,512
Other 14,688 15,453
Total current liabilities 29,787 34,838
Long term debt, less current
maturities - 1,000
Other long term liabilities 152 3,881
Deferred income taxes 6,967 7,475
Minority interest 348 254
Stockholders' equity:
Common stock, par value $.04 per
share; authorized 240,000,000 2,700 2,700
shares, issued 67,499,074 in
2004 and 2003.
Additional paid-in capital 123,882 126,086
Accumulated other comprehensive
income 688 1,466
Retained earnings 115,244 115,424
242,514 245,676
Less: Treasury stock at cost
(1,815,995 shares in 2005
and 2,297,995 shares in 2004) 13,672 17,419
Total stockholders' equity 228,842 228,257
Total liabilities and
stockholders' equity $266,096 $275,705
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Contacts: Hooper Holmes, Inc.
Joseph Marone, Vice President &
Acting Chief Financial Officer of Hooper Holmes
(908) 766-5000
Financial Dynamics for Hooper Holmes
Investors: Jonathan Birt or John Capodanno
Media: Sean Leous
+1-212-850-5600
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