EXHIBIT 99.1
[PROXYMED LOGO] COMPANY NEWS RELEASE
IMPORTANT NOTE:
ProxyMed's live teleconference call to discuss its first quarter of 2005 results
is accessible by calling 1-866-270-6388 beginning at 10:00 a.m. Eastern Time on
Tuesday, May 10, 2005 and will be simultaneously broadcast on the Internet at
www.proxymed.com. Replays of the teleconference call will be available at
www.proxymed.com after 1:00 p.m. ET on May 10th.
CONTACT:
PROXYMED, INC.
GREGORY J. EISENHAUER, CFA
EVP & CHIEF FINANCIAL OFFICER
770-806-4780
GEISENHAUER@PROXYMED.COM
PROXYMED INCREASES REVENUES 6% YEAR OVER YEAR
- SENIOR DEBT SUCCESSFULLY REFINANCED AHEAD OF SCHEDULE -
ATLANTA, GA (BUSINESS WIRE) MAY 9, 2005 - ProxyMed, Inc. (Nasdaq:
PILL), a leading provider of healthcare transaction processing and medical cost
containment services, today reported its operating results for the first quarter
of 2005.
FIRST QUARTER 2005 RESULTS
ProxyMed reported revenues of $21.7 million for the first quarter, an
increase of 5.9% compared to revenues of $20.5 million for the same period of
2004. For the quarter, the Company incurred a net loss of $1.8 million, or
($0.14) per diluted share, compared to a net loss of $0.4 million or ($0.05) per
diluted share in the same quarter last year. Sequentially, revenues declined by
$0.9 million, operating loss remained steady at $1.2 million, and net loss
widened by $0.2 million.
The Company ended the quarter with $11.6 million of cash on its balance
sheet. As previously announced, the Company closed a new senior debt facility
with Wachovia Bank, NA. Proceeds from this facility were used to pre-pay the
Company's senior debt obligations that were maturing on May 31, 2005.
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OPERATING SEGMENT PERFORMANCE
TRANSACTION SERVICES
The Transaction Services segment reported revenues of $18.6 million for
the first quarter of 2005, an increase of 27.5% compared to revenues of $14.6
million for the first quarter of 2004. This revenue gain is due mostly to the
inclusion of two additional months of results from the PlanVista acquisition,
made last March. Core transactions grew 9.3% over the same period. Revenue gains
outpaced transaction growth due to the addition of significantly higher value
cost containment transactions for the entire quarter in 2005.
Sequentially, core transactions grew 1%, sustaining and building upon
the new levels of transactions realized by an 8.5% jump in the fourth quarter.
Revenues declined modestly over the fourth quarter as a result of changes in the
transaction mix.
Operating loss was $1.8 million compared to a loss of $1.7 million in
the fourth quarter. A reduction in the Company's cost for Sarbanes-Oxley was
offset by increases in personnel expenses for accrual of paid time off, which is
seasonal, and increased health insurance expense.
Nancy Ham, President and Chief Operating Officer commented, "We had a
good first quarter as we solidified the new business that we brought on in the
fourth quarter. In addition, we have experienced significant progress in rolling
out our new Web-based solutions, including our new partner portal, our PCAT
transaction management solution and ProxyEnroll. These solutions are critical to
our strategy of evolving from a traditional clearinghouse to a sophisticated
provider of high value-added, transaction management solutions, and have been
very well-received by our customer base."
"For our payer customers I am pleased to announce that we are nearing
completion of our first contract for ESP (Enterprise Solutions for Payers). This
sale to a top 10 national payer is an early validation of our strategy, and we
expect it to represent over $2 million in annualized revenue. In addition, we
are making good sales progress in our core cost containment business, as can be
seen by our announcement today of our expanded business with NRECA."
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STATISTICS
Management considers the following metrics important to monitor its
transaction business:
DESCRIPTION:
(all amounts in thousands) Q/E Q/E Q/E Q/E Q/E
(unaudited) 3/31/05 12/31/04 9/30/04 6/30/04 3/31/04
------- -------- ------- ------- -------
Core transactions (excluding 69,752 69,073 63,677 62,790 63,793
encounters)
Encounters 5,916 6,558 6,561 6,086 9,967
------ ------ ------ ------ ------
TOTAL TRANSACTIONS 75,668 75,631 70,238 68,876 73,760
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LABORATORY COMMUNICATION SOLUTIONS
The Laboratory Communication Solutions segment reported revenues of
$3.1 million for the first quarter of 2005, a decrease of 8.5% sequentially. On
a year over year basis, revenue declined 47.4%, primarily as a result of the
June 2004 disposition of certain contract manufacturing assets. However, year
over year operating income improved by 123.7% and 23% sequentially to $0.6
million due to increased sales of higher margin products and the elimination of
the loss from the contract manufacturing business in the comparable period.
"The laboratory segment of ProxyMed is a relatively mature business,
and we will be challenged for revenue growth as we shift our product mix away
from higher revenue, lower margin products to our new products," said Nancy Ham.
"However, we believe we can grow at the operating income line, as we did this
quarter, as we continue to have success with the roll-out of our new products,
Pilot(TM) and Navigator(TM)."
LOOKING FORWARD:
Kevin McNamara, Chairman of the Board and interim CEO said, "Despite a
lot of change within the Company and the industry, the Company kept its focus in
the first quarter and delivered solid results. I am pleased that we have
accomplished two major corporate objectives: securing a new senior debt facility
and nearing completion of our first ESP deal. The Company is setting the
foundation for future revenue growth through building the sales pipeline, and
accelerated earnings growth through the deployment of its Web-based self-service
tools. Out of the major objectives I laid out last quarter, we have only one
remaining, and that is completing our CEO search. We are in the final stages of
this process, and I expect that we will be in a position to announce our new CEO
in the next week or two. We will revisit the issue of providing financial
guidance for the remainder of 2005 thereafter."
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ABOUT PROXYMED, INC.
ProxyMed provides connectivity, medical cost containment services, business
process outsourcing solutions and related value-added products to physicians,
payers, pharmacies, medical laboratories, and other healthcare institutions.
ProxyMed's services support a broad range of both financial and clinical
transactions, and we are HIPAA certified through Edifecs. To facilitate these
services, ProxyMed is completing the conversion of its non-clinical EDI
transactions to Phoenix(TM), our secure national electronic information
platform, which provides physicians and other primary care providers with direct
connectivity to payers.
For more information, please visit the Company's website at www.proxymed.com.
FORWARD LOOKING STATEMENT
ProxyMed cautions that forward-looking statements contained in this document are
based on current plans and expectations, and that a number of factors could
cause the actual results to differ materially from the guidance given at this
time. Some of these factors are described in the Safe Harbor statement below.
Except for the historical information contained herein, the matters discussed in
this document may constitute forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from those
projected. These statements include those concerning the potential benefits and
effects, including but not limited to any expectations as to profitability,
revenue growth, and other aspects of the financial performance of the combined
Company. In some cases, forward-looking statements can be identified by
terminology such as "may," "will," "should," "potential," "continue," "expects,"
"anticipates," "intends," "plans," "believes," "estimates," and similar
expressions. While these statements reflect our current judgment, they are
subject to risks and uncertainties. Actual results may differ significantly from
projected results due to a number of factors, including, the soundness of our
business strategies relative to the perceived market opportunities; ProxyMed's
ability to successfully develop, market, sell, cross-sell, install and upgrade
its clinical and financial transaction services and applications to current and
new physicians, payers, medical laboratories and pharmacies; the ability to
compete effectively on price and support services; ProxyMed's ability to attract
and retain a qualified CEO; ProxyMed's assessment of the healthcare industry's
need, desire and ability to become technology efficient; and ProxyMed's ability
and that of its business associates to perform satisfactorily under the terms of
its contractual obligations, and to comply with various government rules
regarding healthcare and patient privacy. For further cautions about the risks
of investing in ProxyMed, we refer you to the documents the Company files from
time to time with the Securities and Exchange Commission, particularly the
Company's Form 10-K/A for the year ended December 31, 2004, and Form 10-Q for
fiscal period ending March 31, 2005.
ProxyMed does not assume any obligation to update information contained in this
document. Although this release may remain available on the Company's website or
elsewhere, its continued availability does not indicate that the Company is
reaffirming or confirming any of the information contained herein.
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PROXYMED, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(AMOUNTS IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA)
Three Months Ended March 31,
(unaudited)
---------------------------------
2005 2004
------------ ------------
Net revenues $ 21,714 $ 20,504
------------ ------------
Costs and expenses:
Cost of sales 7,683 8,289
Selling, general and administrative expenses 12,625 10,409
Depreciation and amortization 2,596 1,849
------------ ------------
Total operating costs and expenses 22,904 20,547
------------ ------------
Operating loss (1,190) (43)
Interest expense, net 601 334
Provision for income taxes -- 50
------------ ------------
Net loss $ (1,791) $ (427)
============ ============
Basic and diluted loss per share $ (0.14) $ (0.05)
============ ============
Basic and diluted weighted average shares outstanding 12,626,567 8,570,731
============ ============
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PROXYMED, INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(AMOUNTS IN THOUSANDS)
Three Months Ended March 31,
(unaudited)
----------------------------
2005 2004
-------- --------
Revenues:
Transaction Services $ 18,607 $ 14,594
Laboratory Communication Solutions 3,107 5,910
-------- --------
$ 21,714 $ 20,504
======== ========
Cost of sales:
Transaction Services $ 5,999 $ 4,260
Laboratory Communication Solutions 1,684 4,029
-------- --------
$ 7,683 $ 8,289
======== ========
Selling, general and administrative expenses:
Transaction Services $ 11,971 $ 7,984
Laboratory Communication Solutions 654 1,364
Corporate -- 1,061
-------- --------
$ 12,625 $ 10,409
======== ========
Depreciation and amortization:
Transaction Services $ 2,413 $ 1,554
Laboratory Communication Solutions 183 259
Corporate -- 36
-------- --------
$ 2,596 $ 1,849
======== ========
Operating income (loss):
Transaction Services $ (1,776) $ 796
Laboratory Communication Solutions 586 258
Corporate -- (1,097)
-------- --------
$ (1,190) $ (43)
======== ========
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PROXYMED, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(AMOUNTS IN THOUSANDS)
(unaudited)
March 31, December 31,
Assets 2005 2004
--------- -----------
Current assets:
Cash and cash equivalents $ 11,559 $ 12,374
Accounts receivable - trade, net 16,335 17,591
Other receivables 218 312
Inventory, net 1,667 1,775
Other current assets 1,606 1,399
--------- ---------
Total current assets 31,385 33,451
Property and equipment, net 4,765 4,801
Goodwill, net 93,604 93,604
Purchased technology, capitalized software and other intangibles, net 50,589 52,305
Restricted cash 75 75
Other long-term assets 126 167
--------- ---------
Total assets $ 180,544 $ 184,403
========= =========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable and current portion of long-term debt,
including related party debt $ 20,085 $ 20,572
Accounts payable, accrued expenses and accrued compensation 12,303 13,637
Deferred revenue 723 691
Income taxes payable 184 215
--------- ---------
Total current liabilities 33,295 35,115
Convertible notes 13,137 13,137
Other long-term debt -- 206
Long-term deferred revenue and other long-term liabilities 726 863
--------- ---------
Total liabilities 47,158 49,321
--------- ---------
Stockholders' equity:
Series C 7% Convertible preferred stock -- --
Common stock 13 13
Additional paid-in capital 239,298 239,255
Unearned compensation (61) (113)
Accumulated deficit (105,864) (104,073)
--------- ---------
Total stockholders' equity 133,386 135,082
--------- ---------
Total liabilities and stockholders' equity $ 180,544 $ 184,403
========= =========
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PROXYMED, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Three Months Ended March 31,
----------------------------
2005 2004
---------- ----------
Cash flows from operating activities:
Net loss $ (1,791) $ (427)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation and amortization 2,596 1,849
Provision for doubtful accounts -- 207
Non-cash interest income -- (27)
Stock option compensation charges 95 106
Changes in assets and liabilities, net of
effect of acquisitions:
Accounts and other receivables 1,350 (641)
Inventory 108 (226)
Other current assets 251 60
Accounts payable and accrued expenses (1,860) (51)
Accrued expenses of PlanVista paid by ProxyMed -- (4,011)
Deferred revenue 41 53
Income taxes (31) --
Other, net 390 (137)
-------- --------
Net cash provided by (used in) operating activities 1,149 (3,245)
-------- --------
Cash flows from investing activities:
Net cash acquired in acquisition -- 782
Capital expenditures (723) (705)
Capitalized software (127) (380)
Collections on notes receivable -- 45
Decrease in restricted cash -- 40
Payments for acquisition-related costs -- (776)
-------- --------
Net cash used in investing activities (850) (994)
-------- --------
Cash flows from financing activities:
Net proceeds from sale of common stock -- 24,100
Proceeds from exercise of stock options and warrants -- 8,750
Draws on line of credit -- 4,900
Repayments of line of credit -- (4,400)
Payment of related party note payable (600) --
Payment of notes payable, capital leases and long-term debt (514) (24,063)
-------- --------
Net cash (used in) provided by financing activities (1,114) 9,287
-------- --------
Net (decrease) increase in cash and cash equivalents (815) 5,048
Cash and cash equivalents at beginning of period 12,374 5,333
-------- --------
Cash and cash equivalents at end of period $ 11,559 $ 10,381
======== ========
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