EXHIBIT 99.1
Matria Healthcare Announces Revenue Growth of 21% for the Fourth
Quarter and 18% for 2003; Company Reports EPS of $0.20 for the Fourth
Quarter and $0.71 for the Full Year
MARIETTA, Ga.--(BUSINESS WIRE)--Feb. 19, 2004--Matria Healthcare,
Inc. (NASDAQ/NM:MATR) today announced financial results for the fourth
quarter and year ended December 31, 2003.
Revenues for the fourth quarter of 2003 increased 21% to a record
level of $86.5 million compared with $71.7 million in the fourth
quarter of 2002. Earnings before interest, taxes, depreciation and
amortization (EBITDA) for the fourth quarter of 2003 were $9.2
million. Net earnings for the quarter ended December 31, 2003, were
$2.1 million, or $0.20 per diluted common share. The diluted loss per
common share, excluding special items, was $0.26 for the fourth
quarter of 2002.
For the year ended December 31, 2003, revenues increased 18% to a
record level of $326.8 million compared with $277.6 million in the
full year of 2002. EBITDA for the year ended December 31, 2003, was
$34.6 million. Net earnings for the 12 months of 2003 were $7.3
million, or $0.71 per diluted common share. The diluted earnings per
common share, excluding special items, were $0.10 for the full year
2002.
Fourth quarter 2003 revenues for the Company's Health Enhancement
segment increased by 32% to $63.2 million compared with $47.7 million
in the fourth quarter of 2002. The Health Enhancement segment is
comprised of the Company's disease management and related pharmacy,
laboratory and supplies businesses, its foreign diabetes service
operation and Facet Technologies, the Company's diabetes product
design, development and assembly operation. Fourth quarter 2003
revenues for the Women's Health segment were $23.3 million, a 3%
decrease compared with revenues of $24.0 million in the fourth quarter
of 2002. The Women's Health segment is comprised of the Company's
obstetrical home care clinical serves and maternity disease management
services.
For the year ended December 31, 2003, revenues for the Company's
Health Enhancement segment increased by 30% to $232.5 million compared
with $179.5 million in 2002. Full year 2003 revenues for the Women's
Heath segment decreased by 4% to $94.4 million compared with $98.2
million in the same period in 2002.
Parker H. Petit, Chairman and Chief Executive Officer, stated, "As
previously forecasted, we incurred higher expenses during the quarter
related to the start-up of numerous disease management accounts
commencing in the fourth quarter of 2003 and extending into the first
quarter of 2004. However, we exceeded our revenue forecast for the
fourth quarter as a result of the revenues from these accounts. We are
pleased with the progress we are making in our discussions with
pharmaceutical companies to offer Matria's disease management services
for complex medications, including new bio-pharma drugs, to improve
patient outcomes. We look forward to communicating our new
opportunities in this sector in the future."
The Company also announced its strategic initiative to enter the
neonatal intensive care case management market and the market for
certain specialty pharmaceuticals for infants and children. Petit
commented, "As part of our growth strategy for our Women's Health
segment, we are expanding the breadth and reach of that business to
provide services for infants and children. With our clinical expertise
and national networks, pharmacy distribution capabilities, and our
relationships in that sector of healthcare, this new market is a
natural growth opportunity for our Women's Health business. In concert
with this new strategy, we are changing the name of that business to
the Women's and Children's Health segment."
The Company reported that the current covered lives included in
the Company's disease management programs are 14.2 million compared
with 7.2 million at the end of 2002 and 3.0 million at the end of
2001.
The Company confirmed its previous first quarter of 2004 guidance
forecasting revenues to grow to between $87 million and $89 million
and earnings per share to be in the range of $0.14 to $0.19.
A listen-only simulcast and replay of Matria Healthcare's fourth
quarter conference call will be available on-line at the Company's
website at www.matria.com or at www.fulldisclosure.com on February 20,
2004, beginning at 10:00 a.m. Eastern time.
Matria Healthcare is the largest corporation offering
comprehensive disease management programs to health plans and
employers. Matria manages the chronic diseases and episodic conditions
representing the greatest cost to the healthcare system...diabetes,
cardiovascular diseases, respiratory disorders, high-risk obstetrics,
cancer, chronic pain and depression. Headquartered in Marietta,
Georgia, Matria has more than 40 offices in the United States and
internationally. More information about Matria can be found online at
www.matria.com.
This press release contains forward-looking statements. Such
statements include, but are not limited to, the Company's financial
expectations for the first quarter of 2004, the ability of the Company
to reach final agreement with pharmaceutical companies with respect to
prospective disease management accounts, implement on schedule,
achieve revenue expectations from these agreements and successfully
manage the influx of new accounts, the Company's strategy to expand
it's Women's Health business into the neonatal intensive care case
management and specialty pharmaceutical markets and the impact of the
expansion on the growth of that business. These statements are based
on current information and belief and are not guarantees of future
performance. Among the important factors that could cause actual
results to differ materially from those indicated by such
forward-looking statements include the Company's inability to achieve
its financial expectations for 2004, failure to reach agreement with
pharmaceutical companies, failure to achieve the revenue expectations
for the Company's newly awarded business, delays or problems in
implementation or management of new disease management contracts,
failure to expand relationships with pharmaceutical companies or to
generate revenues from any such alliances, failure of the expansion
strategy in the Women's Health business to generate growth for that
business, developments in the healthcare industry, third-party actions
over which Matria does not have control, regulatory requirements
applicable to Matria's business and the risk factors detailed from
time to time in Matria's periodic reports and registration statements
filed with the Securities and Exchange Commission, including Matria's
Annual Report on Form 10-K for the year ended December 31, 2002. By
making these forward-looking statements, Matria does not undertake to
update them in any manner except as may be required by Matria's
disclosure obligations in filings it makes with the Securities and
Exchange Commission under the federal securities laws.
MATRIA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts)
Three Months Ended Years Ended
December 31, December 31,
------------------ ------------------
2003 2002 2003 2002
-------- -------- -------- --------
Revenues $86,453 $71,688 $326,847 $277,631
Cost of revenues 49,645 43,562 190,923 164,298
Selling and
administrative expenses 27,544 26,394 101,837 91,970
Charges from termination
of retirement plan -- 14,247 -- 14,247
Provision for
doubtful accounts 2,688 1,995 8,609 9,955
Amortization of
intangible assets 140 140 560 560
-------- -------- -------- --------
Operating earnings (loss)
from continuing operations 6,436 (14,650) 24,918 (3,399)
Interest expense, net (3,392) (3,631) (13,843) (13,626)
Other income (expense), net 678 (2,535) 1,457 (3,119)
-------- -------- -------- --------
Earnings (loss) from
continuing operations
before income taxes 3,722 (20,816) 12,532 (20,144)
Income tax expense (benefit) 1,656 (4,840) 5,226 (4,500)
-------- -------- -------- --------
Earnings (loss) from
continuing operations 2,066 (15,976) 7,306 (15,644)
Loss from discontinued
operations, net of
income taxes -- -- -- (682)
-------- -------- -------- --------
Net earnings (loss) $2,066 $(15,976) $7,306 $(16,326)
======== ======== ======== ========
Net earnings (loss)
per common share:
Basic:
Continuing operations $0.20 $(1.59) $0.72 $(1.68)
Discontinued operations -- -- -- (0.07)
-------- -------- --------- --------
$0.20 $(1.59) $0.72 $(1.75)
======== ======== ========= ========
Diluted:
Continuing operations $0.20 $(1.59) $0.71 $(1.68)
Discontinued operations -- -- -- (0.07)
-------- -------- --------- --------
$0.20 $(1.59) $0.71 $(1.75)
======== ======== ========= ========
Weighted average
shares outstanding:
Basic 10,176 10,051 10,132 9,309
Diluted 10,540 10,051 10,361 9,309
MATRIA HEALTHCARE, INC.
UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Amounts in thousands, except per share amounts)
Three Months Ended Years Ended
December 31, December 31,
------------------ ------------------
2003 2002 2003 2002
-------- -------- -------- --------
Reconciliation of Net Earnings (Loss) to EBITDA
Net earnings (loss) $2,066 $(15,976) $7,306 $(16,326)
Loss from discontinued
operations, net of
income taxes -- -- -- --
Income tax expense (benefit) 1,656 (4,840) 5,226 (4,918)
Interest expense, net 3,392 3,631 13,843 13,626
Depreciation and amortization 2,084 2,093 8,260 7,513
-------- -------- -------- --------
EBITDA $9,198 $(15,092) $34,635 $(105)
======== ======== ======== ========
Reconciliation of Net Earnings (Loss) to Adjusted EBITDA
Net earnings (loss) $2,066 $(15,976) $7,306 $(16,326)
Income tax expense (benefit) 1,656 (4,840) 5,226 (4,918)
Interest expense, net 3,392 3,631 13,843 13,626
Depreciation and amortization 2,084 2,093 8,260 7,513
Special charges -- 17,315 -- 22,476
Loss from discontinued
operations, net of tax
of $418 -- -- -- 682
-------- -------- -------- --------
Adjusted EBITDA $9,198 $2,223 $34,635 $23,053
======== ======== ======== ========
Reconciliation of Diluted Earnings (Loss) per Common Share to Diluted
Earnings (Loss) per Common Share excluding Special Items
Diluted earnings (loss)
per common share $0.20 $(1.59) $0.71 $(1.75)
Special charges, net of tax -- 1.33 -- 1.78
Loss from discontinued
operations, net of tax -- -- -- 0.07
-------- -------- -------- --------
Diluted earnings (loss) per
common share excluding
special items $0.20 $(0.26) $0.71 $0.10
======== ======== ======== ========
Schedule of Special Items:
Charges from termination of
retirement plan $-- $14,247 $-- $14,247
Write-off of obsolete
technology investments and
other assets -- 3,068 -- 3,068
Additional accounts
receivable reserves -- -- -- 1,996
Write-off of unamortized
loan costs -- -- -- 692
Retirement of note receivable
from former executive -- -- -- 2,473
-------- -------- -------- --------
Total special charges -- 17,315 -- 22,476
Income tax benefit -- (3,904) -- (5,869)
-------- -------- -------- --------
Total special charges,
net of tax -- 13,411 -- 16,607
Loss from discontinued
operations, net of tax
of $418 -- -- -- 682
-------- -------- -------- --------
Special items, net of tax $-- $13,411 $-- $17,289
======== ======== ======== ========
MATRIA HEALTHCARE, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
(Amounts in thousands)
December 31,
2003 2002
-------- --------
ASSETS
Current assets:
Cash, cash equivalents and
short-term investments $9,008 $5,640
Trade accounts receivable, net 62,822 49,693
Inventories 27,312 26,757
Prepaid expenses and other current assets 17,294 15,147
-------- --------
Total current assets 116,436 97,237
Property and equipment, net 30,790 26,716
Intangible assets, net 151,555 130,571
Deferred income taxes 26,524 30,848
Other assets 8,177 6,035
-------- --------
$333,482 $291,407
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt
and obligations under capital leases $832 $743
Accounts payable, principally trade 41,017 35,177
Other accrued liabilities 41,206 18,761
-------- --------
Total current liabilities 83,055 54,681
Long-term debt and obligations under capital
leases, excluding current installments 121,070 118,215
Other long-term liabilities 5,810 4,731
-------- --------
Total liabilities 209,935 177,627
Shareholders' equity 123,547 113,780
-------- --------
$333,482 $291,407
======== ========
CONTACT: Matria Healthcare, Inc., Marietta
Steve Mengert, 770-767-4500