EXHIBIT 99A
IDX Systems Corporation
1400 Shelburne Road
P.O. Box 1070
Burlington, VT 05402-1070
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Contact: Jack Kane
Chief Financial Officer
802-862-1022
FOR IMMEDIATE RELEASE
IDX SYSTEMS CORPORATION REPORTS
FIRST QUARTER 1999 RESULTS
BURLINGTON, VT, April 21, 1999--IDX Systems Corporation (Nasdaq: IDXC) reported
financial results today for the first quarter ended March 31, 1999.
Revenue in the first quarter was $60.2 million, compared with $72.7 million in
the first quarter of last year. The company reported a first quarter net loss of
($6.9) million or ($0.26) per share, compared with net income of $4.4 million or
$0.16 per share in the same quarter last year.
"As we announced on March 5, 1999, our first quarter financial results are below
expectation due to the unexpected deferral of purchasing decisions by our
customers and prospects," said Richard E. Tarrant, Chief Executive Officer. "We
believe that our business is fundamentally sound and that the performance of our
core business (excluding Internet initiatives) will improve as the year
progresses. We anticipate reporting positive net income in the second quarter
and increasing the profitability of our core business during the balance of the
year. We expect our Internet tracking division, IDX.com, to lose approximately
$9.0 million pretax in 1999, which will result in a pretax loss of approximately
$7.0 million for the Company overall.
Revenue for the year is expected to reach approximately $310 million."
"It is difficult to fully estimate the impact of deferred purchasing decisions
on our financial results in 2000," Mr. Tarrant continued. "Given the information
currently available, we expect to grow revenue by 15-20% in 2000 and to increase
net income substantially in our core business. Once our customers have reached
the other side of Y2K computer problems, we may see an increase in sales orders
that would help offset the longer sales cycle. We also plan to continue to keep
a tight rein on discretionary spending during the year. "
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As part of its Internet strategy, the Company reported that it purchased 80% of
ChannelHealth, Inc. on April 1, 1999. ChannelHealth, based in Bedford,
Massachusetts, develops Internet services that provide consumers with extensive
health-related information and the ability to purchase medical products on-line.
IDX paid $6.5 million in cash for its ownership interest in ChannelHealth, and
may pay an additional $3.0 million, contingent upon certain performance goals. A
substantial portion of the projected loss for the IDX.com tracking division in
1999 is attributable to ChannelHealth.
"We believe the successful healthcare information technology company of the
future will combine software expertise with Internet capabilities," Mr. Tarrant
said. "Given our established customer base, comprehensive system solutions and
our investments in Internet products and services, IDX has solidly defined its
position as a leader in the industry."
Founded in 1969, IDX Systems Corporation provides complete healthcare
information solutions for integrated delivery networks including group
practices, MSOs, health plans, and hospitals. To connect systems and sites
across the enterprise, IDX offers the IDXtendR @ the Site Series--products and
services designed to align physicians and hospitals, streamline patient flow,
enhance quality, and reduce costs. IDX products are used by or are under
contract to be used by more than 110,000 physicians and are installed at over
1,650 client sites, including more than 250 large group practices, each having
75 physicians or more, 270 multi-entity hospital systems, and over 200
integrated delivery networks.
This material contains forward-looking statements that involve a number of risks
and uncertainties. Among the important factors that could cause actual results
to differ materially from those indicated by such forward-looking statements are
the possible deferral, delay or cancellation by customers of computer system
purchase decisions, variations in the volume and timing of systems sales and
installations, timing and quality of development and implementation of year 2000
ready solutions for customers, the potential disruption of customers' purchasing
plans due to work on their own year 2000 problems, development and
implementation of year 2000 ready products for the Company's internal use,
possible delay, varying lengths of sales cycles and installation processes,
seasonal patterns of sales and customer buying behaviors, development by
competitors of new or superior technologies, possible delays in product
development, undetected errors or bugs in software, potential product liability,
changing economic, political and regulatory influences on the healthcare
industry, changes in product pricing policies, possible regulation of the
Company's software by the U.S. Food and Drug Administration, general economic
conditions, and the risk factors detailed from time to time in the Company's
periodic reports and registration statements filed with the Securities and
Exchange Commission, which important factors are incorporated herein by
reference.
- tables follow -
This release is also available on the Internet at:
www.idx.com
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IDX SYSTEMS CORPORATION
Consolidated Statements of Operations and Comprehensive Income (Loss)
(in thousands, except for per share data)
Three Months Ended
March 31
1999 1998
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(Unaudited)
Revenues
Systems sales $ 22,851 $38,966
Maintenance and service fees 37,330 33,771
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Total revenues 60,181 72,737
Operating expenses
Cost of sales 39,961 37,248
Selling, general, and administrative 18,538 13,752
Research and development 13,548 10,316
Nonrecurring charge - 3,201
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Total operating expenses 72,047 64,517
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Operating income (loss) (11,866) 8,220
Other (income) expense (1,108) (1,122)
Loss on impairment of asset 1,642 -
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Income (loss) before taxes (12,400) 9,342
Income tax provision (benefit) (5,500) 4,940
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Net income (loss) $ (6,900) $ 4,402
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Unrealized gain (loss) on securities
available-for-sale (58) (3)
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Comprehensive income (loss) $ (6,958) $ 4,399
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Basic earnings (loss) per share $ (0.26) $ 0.17
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Basic weighted average shares outstanding 26,654 26,155
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Diluted earnings (loss) per share $ (0.26) $ 0.16
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Diluted weighted average shares outstanding 26,654 27,007
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IDX SYSTEMS CORPORATION
Highlights of Consolidated Balance Sheets
(in thousands)
Unaudited
March 31 December 31,
1999 1998
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Assets
Cash and short term investments $ 113,845 $ 124,517
Accounts receivable, net 85,580 99,345
Other current assets 9,789 4,997
Deferred tax asset 4,720 4,720
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Total current assets 213,934 233,579
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Property & equipment, net 35,342 31,905
Capitalized software costs, net 591 665
Other assets 18,426 15,868
Deferred tax asset 2,307 2,307
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Total assets $ 270,600 $ 284,324
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Liabilities and stockholders' equity
Accounts payable and accrued
expenses $ 29,535 $ 31,162
Income taxes - 5,429
Deferred revenue 15,931 18,239
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Total current liabilities 45,466 54,830
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Minority interest 9,259 8,988
Stockholders' equity 215,875 220,506
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Total liabilities and
stockholders' equity $ 270,600 $ 284,324
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IDX SYSTEMS CORPORATION
Statements of Cash Flows
(in thousands)
Quarter Ended
March 31,
1999 1998
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OPERATING ACTIVITIES
Net Income (loss) $ (6,900) $ 4,402
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation and amortization 3,065 2,490
Deferred tax benefit, net of business
acquisitions - (517)
Increase in allowance for doubtful accounts 356 31
Minority interest 270 741
Loss on investment 1,642 -
Write-off of acquired in-process
research & development costs - 3,201
Changes in operating assets and liabilities,
net of business acquisitions:
Accounts receivable 13,409 (4,522)
Prepaid expenses and other assets (4,791) 1,688
Accounts payable 4,270 5,410
Accrued expenses (5,888) (9,270)
Federal and state taxes payable (5,429) -
Deferred revenue (2,308) (2,008)
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Net cash provided by (used in) operating (2,304) 1,646
activities
INVESTING ACTIVITIES
Purchase of property and equipment, net (6,428) (4,156)
Purchase of securities available-for-sale (59,179) (36,076)
Sale of securities available-for-sale 78,659 33,178
Business acquisitions - (4,000)
Other assets (4,200) -
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Net cash provided by (used in) investing 8,852 (11,054)
activities
FINANCING ACTIVITIES
Proceeds from sale of common stock 2,327 6,060
Contributions to affiliates, net - 6,000
Principal repayments of debt (9) (6,066)
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Net cash provided by financing 2,318 5,994
activities ---------- ---------
Increase (decrease) in cash and cash equivalents 8,866 (3,414)
Cash and cash equivalents at beginning of period 10,953 14,061
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Cash and cash equivalents at end of period 19,819 10,647
Short term investments 94,026 104,721
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Cash and short term investments $ 113,845 $ 115,368
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