EXHIBIT 99.1
Air Methods
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The #1 Airborne Healthcare Company
AIR METHODS ANNOUNCES YEAR 2006 FINANCIAL RESULTS
AND PROVIDES FIRST QUARTER 2007 UPDATE
DENVER, CO., March 8, 2007 -- Air Methods Corporation (NasdaqGS: AIRM), the
largest air medical transportation company in the world, reported revenue and
net income for the year and fourth quarter ended December 31, 2006.
For the year, revenue increased 16% to $319.5 million compared to $276.2 million
in the prior year. Net income, was $17.2 million or $1.40 per diluted share
compared to $11.8 million or $1.02 per diluted share. As previously disclosed,
the current year results include a $0.5 million ($0.04 per diluted share)
increase in income tax expense above the highest federal tax rate of 35%,
resulting from the application of the new higher expected rate to deferred
income tax liabilities. The prior year results included a loss on early
extinguishment of debt, net of income taxes, of $1.9 million or $0.16 per
diluted share.
For the fourth quarter, revenue increased 5% to $77.5 million as compared with
$73.6 million during the prior-year period. Net income decreased to $1.2
million or $0.10 per diluted share compared to net income of $3.5 million or
$0.29 per diluted share in the prior-year period. As previously disclosed, the
current-year quarter results include a $0.8 million ($0.06 per diluted share)
increase in income tax expense above the highest federal tax rate of 35%,
resulting from the application of the new higher expected rate to current and
deferred income tax liabilities. In addition the current-year quarter net
income was decreased by $0.6 million, or $0.05 per diluted share, from the
impact of an aviation accident experienced in December 2006.
The current and prior period revenue amounts are presented net of reserves for
uncompensated care, pursuant to the recently announced change in accounting
policy.
The decrease in net income for the fourth quarter is primarily attributed to the
items discussed above. In addition, net revenue per community-based transport
was below expectation for the quarter due to lower than anticipated collections.
Net revenue per community-based transport decreased slightly from $5,996 in the
prior-year quarter to $5,958 in the current period, despite price increases
during 2006. The lower than anticipated collection rate was attributed to
normal fluctuations inherent in the collection process, since change in payer
mix was not significant between the two periods.
During the fourth quarter of 2006, total patients transported within
community-based operations were 8,382 as compared with 7,809 during the
prior-year quarter. Patients transported for community bases in operation
greater than one year (Same-Base Transports) increased by 78 patients or 1%,
while weather cancellations for these same bases increased by 42 transports,
compared with the prior-year period. For the year 2006, Same-Base Transports
increased by 615 or 2%, while weather cancellations for community-bases in
operation greater than one year increased by 173 patient transports, as compared
with the prior year.
The Company also provided an update on first quarter 2007 flight volume.
Same-Base Transports within community-based operations through February were
down 185 patient transports or 4% as compared with the prior-year period, while
weather cancellations for these same bases increased 26 transports compared with
the prior-year period. In addition, reduction in requests for service, which
are not reflected in weather cancellations, was attributed to more severe
weather conditions.
Aaron Todd, CEO of Air Methods, commented, "We are proud of our 2006 financial
results. Our ability to generate strong growth in earnings during a period of
high inflation in our cost of labor and flight operations is evidence of our
strong position within the air medical industry. While our quarterly results
continue to reflect high variability, the long-term trends continue to
demonstrate year-over-year growth in both revenue and earnings."
Mr. Todd added, "Despite the impact of weather on transports during the first
two months of 2007, we remain very optimistic in our ability to achieve
year-over-year earnings growth. We anticipate improving margins within our
hospital-based operations in 2007 due to projected moderation in our maintenance
expenditures and to anticipated price increases on contract renewals. We expect
continued growth in Same-Base Transports for community-based operations,
adjusted for weather variations, and will continue to expand the number of
operating bases in 2007. In addition, reimbursement rates continue to be
positively affected by periodic price increases, as reimbursement rates for
insured patients have kept pace with recent increases overall."
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 1366633,
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 one of the largest community-based providers
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 over 200 helicopters and fixed
wing aircraft.
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)
December 31, December 31,
2006 2005
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ASSETS
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Current assets:
Cash and cash equivalents $ 4,219 3,218
Trade receivables, net 100,559 83,567
Other current assets 35,083 25,726
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Total current assets 139,861 112,511
Net property and equipment 95,575 93,530
Other assets, net 14,721 15,491
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Total assets $ 250,157 221,532
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current liabilities:
Notes payable related to assets held for sale $ 9,560 6,446
Current portion of indebtedness 9,963 10,056
Accounts payable, accrued expenses and other 28,306 29,170
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Total current liabilities 47,829 45,672
Long-term indebtedness 62,346 58,392
Other non-current liabilities 32,668 31,257
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Total liabilities 142,843 135,321
Total stockholders' equity 107,314 86,211
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Total liabilities and stockholders' equity $ 250,157 221,532
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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 Year Ended
December 31, December 31,
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2006 2005 2006 2005
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Revenue:
Flight operations $ 76,469 71,513 313,879 268,249
Product operations 1,009 2,120 5,625 7,929
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Total revenue 77,478 73,633 319,504 276,178
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Expenses:
Operating expenses 59,084 53,196 231,317 199,051
General and administrative 10,521 9,997 40,710 36,971
Depreciation and amortization 3,306 3,131 12,910 12,021
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72,911 66,324 284,937 248,043
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Operating income 4,567 7,309 34,567 28,135
Interest expense (1,473) (1,310) (5,821) (5,956)
Loss on early extinguishment of debt - - - (3,104)
Other, net 406 256 1,598 950
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Income before income taxes 3,500 6,255 30,344 20,025
Income tax expense (2,299) (2,777) (13,144) (8,193)
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Net income $ 1,201 3,478 17,200 11,832
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Income per common share - basic:
Basic $ 0.10 0.31 1.46 1.07
Diluted $ 0.10 0.29 1.40 1.02
Weighted average common shares outstanding:
Basic 11,819,102 11,171,835 11,748,107 11,058,971
Diluted 12,344,396 11,843,815 12,306,047 11,654,885