Exhibit 99.1
Healthaxis Announces First Quarter 2007 Operating Results
Revenue Growth Leads to Significant Improvement in Operating Results
IRVING, Texas--(BUSINESS WIRE)--April 27, 2007--Healthaxis Inc.
(NASDAQ: HAXS), an innovative provider of technology-enhanced,
integrated business process solutions and services, including claims
and benefit administration applications, web-enabled software
solutions and outsourced claims related services for health benefit
administrators and health insurance claims processors, reported
financial results today for the three months ended March 31, 2007.
First Quarter 2007 Financial Highlights
-- 2007 first quarter revenues were $4.2 million, 7% higher than
the first quarter of 2006. Revenue from transaction fees, ASP
license fees, and professional services were higher as we
added a significant number of participant lives to our systems
as the result of Insur-Admin(C) and Insur-Claims(C)
implementations for new customers. In addition to a major
implementation over the past year, we are implementing or have
implemented the three additional new customers that we
announced previously this year. BPO services revenues
increased due to the additional participant lives on our
systems combined with the addition of two BPO-only customers
in 2006.
-- The Company reported a $34,000 operating loss in the first
quarter of 2007 compared to an operating loss of $441,000 in
the same quarter of 2006. The improved operating results for
the first quarter of 2007 are primarily derived from higher
revenue combined with lower sales and marketing and general
and administrative expenses. These lower expenses were
partially offset by higher transaction-processing variable
costs from vendor partners related to the increase in
transaction fee revenue. The Company also recorded non-cash
equity compensation expense of approximately $31,000 in the
first quarter of 2007. Depreciation and amortization expense
was $276,000 and $259,000 for the first quarter of 2007 and
2006, respectively.
-- The Company reported a 2007 first quarter net loss of $62,000
($0.01 per share) compared to a net loss in the first quarter
of 2006 of $462,000 ($0.08 per share). In the first quarter of
2007, the Company generated positive cash flow from operations
for the third consecutive quarter.
-- On April 16, 2007, the Company entered into an amendment to
its Loan and Security Agreement ("LSA") with Silicon Valley
Bank. Under the original LSA, the revolving line would have
expired in August 2007. As a result of the amendment, 1) the
expiration of the revolving line is extended to April 2009, 2)
the available borrowing limit and draw period under the
equipment line were increased, and 3) certain covenants were
modified. The Company elected to reduce the maximum amount
available under the revolving line to avoid paying higher
unused revolving line facility fees.
Review and Outlook
Commenting on the Company's first quarter results, President and
Chief Executive Officer, John M. Carradine, said, "We are now
essentially finished with the implementation of a top 10 third party
administrator that has been in process for more than a year. We
believe this implementation and the results we have achieved with this
customer highlight the competitiveness of Healthaxis systems and
solutions and validate our position as a leading competitor in the
outsourced healthcare information technology services market. We have
done in the past year what others were unable to do over a much longer
period of time, validating the power and flexibility of our systems
and the professionalism and domain expertise of our team. Other good
news is that we have continued to win business. The new customers may
not be top 10 TPAs but they are dynamic, growing companies that are
helping to provide solutions to the health insurance market. We look
forward to helping these companies grow and achieve their objectives.
And as they grow, so will Healthaxis.
"As to the first quarter of 2007, revenue and profitability
measures improved over last year, which was also a substantial
improvement over the year before. This marks our third consecutive
quarter of break-even or near break-even operations and positive cash
flow from operations. We believe we now are in the best financial
condition that we have been over the past several years. We need to
continue to improve to reach consistent profitability. To do that, we
continue to assess ways to accelerate our revenue growth. We continue
to balance our growth objectives with prudent cost control, but are
still focused on ways to accelerate contract closes and
implementations."
About Healthaxis Inc.
Healthaxis (NASDAQ: HAXS) is an innovative provider of healthcare
payer solutions. By combining technology and services Healthaxis can
deliver value to payers and their customers. The company offers fully
integrated business process outsourcing and claims administration
systems that incorporate advanced technology solutions. Healthaxis'
technology is time tested, scalable and offered on an ASP basis. The
Smart Front End(R) enables payers the ultimate flexibility in network
re-pricing and delivering to their legacy system a fully edited,
clean, pre-priced claim to ensure the highest levels of auto
adjudication. Healthaxis' claims administration systems solutions
provide an end to end cost competitive solution for all sizes of
payers: enrollment, data capture, administration, claims, customer
service, print distribution and web services. For information on
Healthaxis products and services, call (800) 519-0679 or visit their
website at www.healthaxis.com.
Forward-looking statements:
Statements that are not purely historical facts, including without
limitation statements about anticipated or expected future revenue and
performance, constitute forward-looking statements within the meaning
of Section 27A of the Securities and Exchange Act of 1934, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements are subject to known and unknown
risks, uncertainties and other factors, which may cause actual results
to be materially different from those contemplated by the
forward-looking statements. Such factors include without limitation
the risks and uncertainties identified in our documents filed with, or
furnished to, the Securities and Exchange Commission, including those
identified under the caption "Risk Factors" in our most recently filed
Form 10-K. We undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. Readers are cautioned not to place undue
reliance on forward-looking statements.
Healthaxis Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except share and per share data) (Unaudited)
Three Months Ended March 31,
2007 2006
------------- -------------
Revenues $4,211 $3,918
Expenses:
Cost of revenues 3,438 3,376
Sales and marketing 248 374
General and administrative 559 609
------------- -------------
Total operating expenses 4,245 4,359
------------- -------------
Operating loss (34) (441)
Interest and other income (expense), net (25) (21)
Income tax expense (3) -
------------- -------------
Net loss $(62) $(462)
============= =============
------------- -------------
Net loss per share of common stock $(0.01) $(0.08)
============= =============
(Basic and diluted)
Weighted average common shares used in
computing net loss per share:
Basic and diluted 8,171,551 6,088,855
Healthaxis Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data) (Unaudited)
Mar. 31, Dec. 31,
2007 2006
------------- -------------
Assets
Cash and cash equivalents $3,095 $3,362
Accounts and notes receivable, net 2,869 2,943
Other current assets 605 544
------------- -------------
Current assets 6,569 6,849
Property, equipment and software, net 1,435 1,550
Goodwill 11,276 11,276
Other assets 1,734 1,643
------------- -------------
Total assets $21,014 $21,318
============= =============
Liabilities and stockholders' equity
Current liabilities $4,530 $5,294
Long-term debt 912 454
Other long-term liabilities 1,273 1,248
Stockholders' equity 14,299 14,322
------------- -------------
Total liabilities and stockholders'
equity $21,014 $21,318
============= =============
CONTACT: Healthaxis Inc.
Ron Herbert, CFO, 972-443-5000
rherbert@healthaxis.com