Exhibit 99.2
EMDEON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2006 | 2005 | |||||||
Revenue | $ | 339,119 | $ | 303,934 | ||||
Costs and expenses: | ||||||||
Cost of operations | 195,267 | 172,163 | ||||||
Development and engineering | 14,914 | 14,640 | ||||||
Sales, marketing, general and administrative | 88,832 | 82,137 | ||||||
Depreciation and amortization | 18,928 | 16,504 | ||||||
Legal expense | 542 | 4,160 | ||||||
Loss on investments | — | 3,832 | ||||||
Interest income | 4,419 | 4,321 | ||||||
Interest expense | 4,691 | 4,781 | ||||||
Income before income tax provision and minority interest | 20,364 | 10,038 | ||||||
Income tax provision | 4,562 | 189 | ||||||
Minority interest in WebMD Health Corp., net of tax | (629 | ) | — | |||||
Net income | $ | 16,431 | $ | 9,849 | ||||
Net income per common share: | ||||||||
Basic and diluted | $ | 0.06 | $ | 0.03 | ||||
Weighted-average shares outstanding used in computing net income per common share: | ||||||||
Basic | 287,195 | 325,334 | ||||||
Diluted | 295,492 | 335,689 | ||||||
EMDEON CORPORATION
CONSOLIDATED SEGMENT INFORMATION
(In thousands, except per share data, unaudited)
CONSOLIDATED SEGMENT INFORMATION
(In thousands, except per share data, unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2006 | 2005 | |||||||
Revenues | ||||||||
Emdeon Business Services | $ | 201,154 | $ | 185,733 | ||||
Emdeon Practice Services | 75,706 | 73,018 | ||||||
WebMD | 50,051 | 33,575 | ||||||
Porex | 20,587 | 19,856 | ||||||
Inter-segment eliminations | (8,379 | ) | (8,248 | ) | ||||
$ | 339,119 | $ | 303,934 | |||||
Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) | ||||||||
Emdeon Business Services | $ | 43,193 | $ | 38,253 | ||||
Emdeon Practice Services | 10,173 | 4,397 | ||||||
WebMD (a) | 6,527 | 3,230 | ||||||
Porex | 5,554 | 5,397 | ||||||
Corporate (a) | (11,274 | ) | (12,005 | ) | ||||
$ | 54,173 | $ | 39,272 | |||||
Adjusted EBITDA per basic common share (b) | $ | 0.19 | $ | 0.12 | ||||
Adjusted EBITDA per diluted common share (b) | $ | 0.18 | $ | 0.12 | ||||
Interest, taxes, non-cash and other items (c) | ||||||||
Depreciation and amortization | $ | (18,928 | ) | $ | (16,504 | ) | ||
Amortization of non-cash advertising | (1,605 | ) | (2,627 | ) | ||||
Non-cash stock-based compensation (d) | (12,462 | ) | (1,651 | ) | ||||
Legal expense | (542 | ) | (4,160 | ) | ||||
Loss on investments | — | (3,832 | ) | |||||
Interest income | 4,419 | 4,321 | ||||||
Interest expense | (4,691 | ) | (4,781 | ) | ||||
Minority interest in WebMD Health Corp., net of tax | 629 | — | ||||||
Income tax provision | (4,562 | ) | (189 | ) | ||||
Net income | $ | 16,431 | $ | 9,849 | ||||
Net income per common share: | ||||||||
Basic and diluted | $ | 0.06 | $ | 0.03 | ||||
Weighted-average shares outstanding used in computing net income per common share: | ||||||||
Basic | 287,195 | 325,334 | ||||||
Diluted | 295,492 | 335,689 | ||||||
(a) | Adjusted EBITDA during prior periods, for the Corporate and WebMD segments, has been reclassified to conform to the current period presentation. | |
(b) | Adjusted EBITDA per basic and diluted common share is based on the weighted-average shares outstanding used in computing net income per common share (basic and diluted). | |
(c) | Reconciliation of Adjusted EBITDA to net income. | |
(d) | Reflects the adoption of SFAS 123R effective January 1, 2006. |
EMDEON CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, | December 31, | |||||||
2006 | 2005 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Cash and cash equivalents | $ | 137,145 | $ | 159,510 | ||||
Short-term investments | 239,653 | 267,387 | ||||||
Accounts receivable, net | 236,057 | 233,070 | ||||||
Inventory | 13,852 | 14,251 | ||||||
Prepaid expenses and other current assets | 33,605 | 34,615 | ||||||
Total current assets | 660,312 | 708,833 | ||||||
Marketable equity securities | 4,265 | 4,481 | ||||||
Property and equipment, net | 120,791 | 116,032 | ||||||
Goodwill | 1,087,731 | 1,075,549 | ||||||
Intangible assets, net | 240,095 | 240,510 | ||||||
Other assets | 49,116 | 50,278 | ||||||
Total Assets | $ | 2,162,310 | $ | 2,195,683 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Accounts payable | $ | 10,525 | $ | 11,611 | ||||
Accrued expenses | 172,179 | 186,381 | ||||||
Deferred revenue | 125,705 | 115,840 | ||||||
Total current liabilities | 308,409 | 313,832 | ||||||
Convertible notes | 650,000 | 650,000 | ||||||
Other long-term liabilities | 15,372 | 15,353 | ||||||
Minority interest in WebMD Health Corp. | 48,005 | 43,229 | ||||||
Convertible redeemable exchangeable preferred stock | 98,591 | 98,533 | ||||||
Stockholders’ equity | 1,041,933 | 1,074,736 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 2,162,310 | $ | 2,195,683 | ||||
EMDEON CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2006 | 2005 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 16,431 | $ | 9,849 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 18,928 | 16,504 | ||||||
Minority interest in WebMD Health Corp., net of tax | (629 | ) | — | |||||
Amortization of debt issuance costs | 728 | 726 | ||||||
Non-cash advertising | 1,605 | 2,627 | ||||||
Non-cash stock-based compensation | 12,462 | 1,651 | ||||||
Bad debt expense | 1,050 | 2,283 | ||||||
Loss on investments | — | 3,832 | ||||||
Reversal of income tax valuation allowance applied to goodwill | 2,157 | — | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (2,245 | ) | (14,122 | ) | ||||
Inventory | 446 | 253 | ||||||
Prepaid expenses and other, net | (710 | ) | 2,812 | |||||
Accounts payable | (1,133 | ) | (8,631 | ) | ||||
Accrued expenses and other long-term liabilities | (9,886 | ) | (106 | ) | ||||
Deferred revenue | 7,557 | 5,279 | ||||||
Net cash provided by operating activities | 46,761 | 22,957 | ||||||
Cash flows from investing activities: | ||||||||
Proceeds from maturities and sales of available-for-sale securities | 166,228 | 45,846 | ||||||
Purchases of available-for-sale securities | (137,815 | ) | (2,550 | ) | ||||
Purchases of property and equipment | (14,168 | ) | (11,892 | ) | ||||
Proceeds received from sale of property and equipment | — | 400 | ||||||
Cash paid in business combinations, net of cash acquired | (27,328 | ) | (70,775 | ) | ||||
Net cash used in investing activities | (13,083 | ) | (38,971 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of common stock | 10,565 | 13,170 | ||||||
Purchases of treasury stock | (66,633 | ) | — | |||||
Payments of notes payable and other | (94 | ) | (63 | ) | ||||
Net cash (used in) provided by financing activities | (56,162 | ) | 13,107 | |||||
Effect of exchange rates on cash | 119 | (358 | ) | |||||
Net decrease in cash and cash equivalents | (22,365 | ) | (3,265 | ) | ||||
Cash and cash equivalents at beginning of period | 159,510 | 46,019 | ||||||
Cash and cash equivalents at end of period | $ | 137,145 | $ | 42,754 | ||||