EXHIBIT 99.1
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Air Methods
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The #1 Airborne Healthcare Company
AIR METHODS REPORTS 1Q2006 RESULTS AND 2Q2006 UPDATE
Quarterly Revenue Increases 30.5%; Fully Diluted EPS Increases to $0.21
April Community-Based Flight Volume Remained Strong
DENVER, CO., May 9, 2006 -- Air Methods Corporation (NASDAQ: AIRM), the largest
air medical transportation company in the world, reported financial results for
the first quarter ended March 31, 2006 and provided an update of second quarter
2006 flight volumes. Revenue increased 30.5% to $89.4 million from $68.5
million in the year-ago quarter. Net income for the first quarter of 2006 was
$2.6 million or $0.22 per basic share ($0.21 per diluted share), compared with a
net loss of $(0.5) million or $(0.04) per basic and diluted share in the first
quarter of 2005.
The $3.0 million increase in net income was primarily attributed to increases in
patients transported from community bases in operation greater than one year
(Same-Base Transports) and from an increase in net revenue after bad debt
expense per transport for community-based operations. For the quarter,
Same-Base Transports increased by 907 patients or 14.0%. Of this amount, 551
transports were directly attributed to a decrease in missed flights due to
weather cancellations as compared with the prior-year quarter.
During the 2006 first quarter, total patients transported within community-based
operations were 7,612 as compared with 6,738 in the prior-year quarter. Net
revenue, after bad debt expense, per community-based transport increased 16.8%
to $5,978 from $5,118, while days' sales outstanding in receivables, net of bad
debt reserves, for consolidated operations increased from 99 days as of March
31, 2005 and 105 days as of December 31, 2005, to 111 days as of March 31, 2006.
The improvement in net reimbursement per transport is primarily attributed to
price increases, while the increase in days' sales outstanding during the
current quarter was previously anticipated due to recent centralization of
community-based billing operations.
For the first quarter, community-based operations revenue increased 31.9% to
$45.5 million compared to $34.5 million, net of bad debt expense, while current
period divisional net income increased to $6.8 million from $0.5 million.
Hospital-based operations revenue increased 18.9% to $26.6 million compared to
$22.4 million, while divisional net income decreased from $0.6 million to a
$(0.2) million loss in the current period. The decrease in profitability within
the hospital-based operations was primarily attributed to higher labor costs
associated with the new collective bargaining agreement with the pilot workforce
and higher maintenance costs due to an increase in overhaul events. For
consolidated flight operations, pilot wages, overtime pay and benefits increased
$1.7 million during the quarter from the implementation of the collective
bargaining agreement, effective January 1, 2006. The incremental cost
associated with the collective bargaining agreement does not reflect reductions
for inflationary adjustments that would have otherwise applied. External
revenue and divisional net income from external contracts for the Products
Division remained relatively unchanged at $1.6 million and $0.4 million,
respectively, as compared with the prior-year quarter.
The Company also provided an update on second quarter 2006 flight volume. Total
community-based transports of 2,902 during the month of April compare favorably
with an average of 2,537 per month during the first quarter of 2006 and 2,704
during April of 2005. Same-Base Transports during the month of April increased
by 123 transports or 4.6% as compared with the prior-year month. Weather
cancellations for community bases in operation greater than one year decreased
by 15 transports as compared with the prior-year month.
Aaron Todd, CEO, stated, "Our first quarter results reflect a continuation of
growth in both revenue and earnings driven by improved flight volume, increased
reimbursement and new base expansion. We are pleased with our financial
performance, especially when considering the first-year implementation costs
associated with the new pilot collective bargaining agreement have been included
in these results. We are encouraged by the continued growth in Same-Base
Transports in April and will continue our focus on reducing our days' sales
outstanding within our net receivables now that the centralization of our
billing function is nearing completion."
Mr. Todd added, "We continue to enjoy numerous opportunities to expand our
flight operations within both the community-based and hospital-based operations.
Since we have multiple new aircraft already on order, we believe we are better
able to take advantage of many of these opportunities despite the current
limitation in aircraft availability from manufacturers through 2007."
The Company will discuss these results in a conference call scheduled today at
4:15 p.m. Eastern. Interested parties can access the call by dialing (888)
396-5640 (domestic) or (706) 643-0580 (international) or by accessing the web
cast at www.airmethods.com. A replay of the call will be available at (800)
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642-1687 (domestic) or (706) 645-9291 (international), access number 886044, for
3 days following the call; and the web cast can be accessed at
www.airmethods.com for 30 days.
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Air Methods Corporation (www.airmethods.com) is a leader in emergency
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aeromedical transportation and medical services. The Air Medical Services
Division is the largest provider of air medical transport services for
hospitals. The LifeNet Division is the largest community-based provider of air
medical services. The Products Division specializes in the design and
manufacture of aeromedical and aerospace technology. The Company's fleet of
owned, leased or maintained aircraft features approximately 200 helicopters and
fixed wing aircraft.
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AIRM
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NASDAQ
LISTED
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FORWARD LOOKING STATEMENTS: This news release includes certain forward-looking
statements, which are subject to various risks and uncertainties. Actual results
could differ materially from those currently anticipated due to a number of
factors, including but not limited to the size, structure and growth of the
Company's air medical services and products markets; the collection rates for
patient transports; the continuation and/or renewal of air medical service
contracts; the acquisition of profitable Products Division contracts and other
flight service operations; the successful expansion of the community-based
operations; and other matters set forth in the Company's public filings.
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CONTACTS: Aaron D. Todd, Chief Executive Officer, (303) 792-7413 or Joe Dorame
at Lytham Partners, LLC at (602) 889-9700. Please contact Christine Clarke at
(303) 792-7579 to be included on the Company's fax and/or mailing list.
- FINANCIAL STATEMENTS ATTACHED -
AIR METHODS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Amounts in thousands)
March 31, 2006 December 31, 2005
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ASSETS
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Current assets:
Cash and cash equivalents $ 3,051 3,218
Trade receivables, net 89,551 83,567
Other current assets 25,842 25,726
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Total current assets 118,444 112,511
Net equipment and leasehold improvements 94,520 93,530
Other assets, net 15,479 15,491
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Total assets $ 228,443 221,532
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current liabilities:
Notes payable and other indebtedness $ 16,183 16,502
Accounts payable, accrued expenses and other 31,526 29,170
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Total current liabilities 47,709 45,672
Long-term indebtedness 59,355 58,392
Other non-current liabilities 30,676 31,257
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Total liabilities 137,740 135,321
Total stockholders' equity 90,703 86,211
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Total liabilities and stockholders' equity $ 228,443 221,532
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AIR METHODS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except share and per share amounts)
Quarter Ended
March 31,
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2006 2005
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Revenue:
Flight operations $ 87,831 66,958
Product operations 1,605 1,550
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Total revenue 89,436 68,508
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Expenses:
Operating expenses 70,960 56,063
General and administrative 9,827 8,763
Depreciation and amortization 3,171 2,897
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83,958 67,723
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Operating income 5,478 785
Interest expense (1,356) (1,893)
Other, net 346 373
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Income (loss) before income taxes 4,468 (735)
Income tax benefit (expense) (1,888) 267
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Net income (loss) $ 2,580 (468)
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Income (loss) per common share:
Basic $ 0.22 (0.04)
Diluted $ 0.21 (0.04)
Weighted average common shares outstanding - basic 11,635,327 10,998,232
Weighted average common shares outstanding - diluted 12,278,738 10,998,232