HLTH 8-K Emdeon Announces Second Quarter Results

Exhibit 99.2

EMDEON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2006			2005			2006			2005
Revenue:
Services	$	313,766		$	282,729		$	615,346		$	549,307
Products		41,115			39,827			78,654			77,183
Total revenue		354,881			322,556			694,000			626,490
Cost of operations:
Services		177,039			161,840			354,202			316,016
Products		20,107			20,110			38,211			38,097
Total cost of operations		197,146			181,950			392,413			354,113
Development and engineering		15,283			14,457			30,197			29,097
Sales, marketing, general and administrative		90,008			83,533			178,840			165,670
Depreciation and amortization		19,381			17,541			38,309			34,045
Legal expense		275			4,283			817			8,443
Advisory expense		4,104			—			4,104			—
Loss (gain) on investments		—			(190	)		—			3,642
Loss on redemption of convertible debt		—			1,902			—			1,902
Interest income		4,435			3,936			8,854			8,257
Interest expense		4,668			3,895			9,359			8,676
Income before income tax provision and minority interest		28,451			19,121			48,815			29,159
Income tax provision		5,434			2,955			9,996			3,144
Minority interest in WebMD Health Corp., net of tax		(164	)		—			(793	)		—
Net income	$	23,181		$	16,166		$	39,612		$	26,015
Net income per common share:
Basic	$	0.08		$	0.05		$	0.14		$	0.08
Diluted	$	0.08		$	0.05		$	0.13		$	0.08
Weighted-average shares outstanding used in computing net income per common share:
Basic		285,086			337,303			286,141			331,318
Diluted		296,722			349,624			296,107			342,656

EMDEON CORPORATION
CONSOLIDATED SEGMENT INFORMATION
(In thousands, except per share data, unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2006			2005			2006			2005
Revenue
Emdeon Business Services	$	206,943		$	191,514		$	408,097		$	377,247
Emdeon Practice Services		77,272			78,596			152,978			151,614
WebMD		56,612			40,465			106,663			74,040
Porex		22,659			20,397			43,246			40,253
Inter-segment eliminations		(8,605	)		(8,416	)		(16,984	)		(16,664	)
	$	354,881		$	322,556		$	694,000		$	626,490
Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”)
Emdeon Business Services	$	49,598		$	40,420		$	92,791		$	78,673
Emdeon Practice Services		12,119			8,183			22,292			12,580
WebMD (a)		9,599			2,793			16,126			6,023
Porex		7,045			6,064			12,599			11,461
Corporate (a)		(11,628	)		(11,742	)		(22,902	)		(23,747	)
	$	66,733		$	45,718		$	120,906		$	84,990
Adjusted EBITDA per diluted common share (b)	$	0.22		$	0.13		$	0.41		$	0.25
Interest, taxes, non-cash and other items (c)
Depreciation and amortization	$	(19,381	)	$	(17,541	)	$	(38,309	)	$	(34,045	)
Non-cash stock-based compensation (d)		(13,100	)		(716	)		(25,562	)		(2,367	)
Non-cash advertising		(1,189	)		(2,386	)		(2,794	)		(5,013	)
Legal expense		(275	)		(4,283	)		(817	)		(8,443	)
Advisory expense		(4,104	)		—			(4,104	)		—
(Loss) gain on investments		—			190			—			(3,642	)
Loss on redemption of convertible debt		—			(1,902	)		—			(1,902	)
Interest income		4,435			3,936			8,854			8,257
Interest expense		(4,668	)		(3,895	)		(9,359	)		(8,676	)
Income tax provision		(5,434	)		(2,955	)		(9,996	)		(3,144	)
Minority interest in WebMD Health Corp., net of tax		164			—			793			—
Net income	$	23,181		$	16,166		$	39,612		$	26,015
Net income per common share:
Basic	$	0.08		$	0.05		$	0.14		$	0.08
Diluted	$	0.08		$	0.05		$	0.13		$	0.08
Weighted-average shares outstanding used in computing net income per common share:
Basic		285,086			337,303			286,141			331,318
Diluted		296,722			349,624			296,107			342,656

(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 diluted common share is based on the weighted-average shares outstanding used in computing diluted net income per common share.
(c)	Reconciliation of Adjusted EBITDA to net income (see Annex A — Explanation of Non-GAAP Financial Measures).
(d)	Reflects the adoption of SFAS 123R effective January 1, 2006.

EMDEON CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

	June 30,		December 31,
	2006		2005
	(Unaudited)
Assets
Cash and cash equivalents	$	92,210	$	159,510
Short-term investments		296,750		267,387
Accounts receivable, net		239,024		233,070
Inventory		14,486		14,251
Prepaid expenses and other current assets		36,079		34,615
Total current assets		678,549		708,833
Marketable equity securities		2,944		4,481
Property and equipment, net		126,376		116,032
Goodwill		1,110,521		1,075,549
Intangible assets, net		238,213		240,510
Other assets		47,837		50,278
Total Assets	$	2,204,440	$	2,195,683
Liabilities and Stockholders’ Equity
Accounts payable	$	15,135	$	11,611
Accrued expenses		158,249		186,381
Deferred revenue		125,811		115,840
Total current liabilities		299,195		313,832
Convertible notes		650,000		650,000
Other long-term liabilities		15,946		15,353
Minority interest in WebMD Health Corp.		53,811		43,229
Convertible redeemable exchangeable preferred stock		98,650		98,533
Stockholders’ equity		1,086,838		1,074,736
Total Liabilities and Stockholders’ Equity	$	2,204,440	$	2,195,683

EMDEON CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)

	Six Months Ended
	June 30,
	2006			2005
Cash flows from operating activities:
Net income	$	39,612		$	26,015
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		38,309			34,045
Minority interest in WebMD Health Corp., net of tax		(793	)		—
Amortization of debt issuance costs		1,461			1,333
Non-cash advertising		2,794			5,013
Non-cash stock-based compensation		25,562			2,367
Bad debt expense		1,645			3,722
Loss on investments		—			3,642
Loss on redemption of convertible debt		—			1,902
Reversal of income tax valuation allowance applied to goodwill		5,215			2,146
Changes in operating assets and liabilities:
Accounts receivable		(4,719	)		(18,350	)
Inventory		(179	)		186
Prepaid expenses and other, net		(3,659	)		1,655
Accounts payable		3,479			(5,881	)
Accrued expenses and other long-term liabilities		222			(4,596	)
Deferred revenue		6,272			9,501
Net cash provided by operating activities		115,221			62,700
Cash flows from investing activities:
Proceeds from maturities and sales of available-for-sale securities		398,870			190,673
Purchases of available-for-sale securities		(426,470	)		(94,350	)
Purchases of property and equipment		(28,971	)		(38,717	)
Proceeds received from sale of property and equipment		—			400
Cash paid in business combinations, net of cash acquired		(84,846	)		(74,110	)
Net cash used in investing activities		(141,417	)		(16,104	)
Cash flows from financing activities:
Proceeds from issuance of common stock		30,433			31,437
Purchases of treasury stock		(71,843	)		—
Redemption of convertible debt		—			(86,694	)
Payments of notes payable and other		(173	)		(304	)
Net cash used in financing activities		(41,583	)		(55,561	)
Effect of exchange rates on cash		479			(1,124	)
Net decrease in cash and cash equivalents		(67,300	)		(10,089	)
Cash and cash equivalents at beginning of period		159,510			46,019
Cash and cash equivalents at end of period	$	92,210		$	35,930