EATONTOWN, N.J., June 29 /PRNewswire-FirstCall/ -- QMed, Inc. today announced financial results for the second quarter ending May 31, 2005. Revenues for the three months were $5,462,897 compared to $3,724,881 a year ago. Net income was $870,991 or $0.05 per share fully diluted compared to a net loss of $(1,432,269) or $(0.10) per share in the year earlier. The Company had working capital of approximately $21,000,000 at May 31, 2005 compared to working capital of approximately $6,000,000 at November 30, 2004.
Net income for the quarter included approximately $261,000 of implementation costs associated with work on the Medicare Advantage Special Needs Plan (SNP) project in South Dakota for the Company’s QMedCare, Inc., subsidiary. In addition, the Company incurred approximately $48,000 of development costs associated with its Health e Monitoring, Inc., (HeM) subsidiary. While it is anticipated that these implementation and development costs will increase during the rest of the fiscal year, core business is expected to remain profitable.
Michael W. Cox, QMed president and CEO said, “We are pleased with our continued profitable performance and especially with the important ongoing implementation and development work that our strong balance sheet permits. Both QMedCare and HeM are integral to our diversification and growth, and we expect that they will be key builders of shareholder value. It is important to emphasize that the growth we anticipate from these efforts is both short- and long-term: we expect to enroll the first members into our South Dakota program in early 2006, while Health e Monitoring is expected to produce its first revenues in the third quarter.”
“QMedCare and HeM are both wholly owned subsidiaries,” he continued. “As previously stated, QMedCare will act as an investor/holding company in affiliated companies. These affiliates are expected to operate as Medicare Advantage Special Needs Plans or as firms that provide third party administration services. QMedCare is the sole investor in QMedCare Dakota, LLC, a company specifically formed to administer the anticipated SNP project in South Dakota. We see such projects as the natural next step to utilizing our sophisticated evidence-based clinical information management system. The market potential for Medicare SNPs is clearly very large. HeM provides QMed with an offering complementary to our traditional health plan business since, for the first time, it gives us access to the employer and consumer markets. Taken together, these strategic developments take QMed to the next level in healthcare services,” Cox concluded.
About QMed, Inc.
QMed provides evidence-based clinical information management systems around the country to its health plan customers. The system incorporates DM services and decision support to physicians. The Company has been selected in two Medicare Demonstrations to test the feasibility of reimbursing its care coordinated DM services in the vast Medicare fee-for-service program. More information on QMed, Inc. can be obtained at http://www.qmedinc.com, by calling (732) 544-5544 or by emailing investor@qmedinc.com.
QMED, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS May 31, 2005 November 30, 2004 ASSETS (unaudited) Current assets Cash and cash equivalents $2,985,872 $3,292,571 Investments 18,935,230 2,097,362 Accounts receivable, net of allowances of $71,312 and $52,690, respectively 3,326,323 2,750,507 Inventory, net of reserve 41,693 38,355 Prepaid expenses and other current assets 349,939 440,620 25,639,057 8,619,415 Property and equipment, net of accumulated depreciation 1,110,149 1,180,050 Product software development costs, net 924,091 858,022 Non-current accounts receivable 199,254 - Other assets 644,881 132,136 Investment in joint ventures 45,458 47,854 $28,562,890 $10,837,477 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable and accrued expenses $1,367,127 $817,234 Leases payable, current portion 135,683 119,757 Accrued salaries and commissions 518,042 416,382 Fees reimbursable to health plans 23,640 161,178 Contract billings in excess of revenues 2,124,825 1,245,862 Deferred warranty revenue 22,026 23,652 Income taxes payable - 16,000 4,191,343 2,800,065 Leases payable - long term 155,374 146,742 4,346,717 2,946,807 Commitments and Contingencies Stockholders’ equity Common stock $.001 par value; 40,000,000 shares authorized; 16,673,626 and 15,150,054 shares issued and 16,651,626 and 15,128,054 outstanding, respectively 16,674 15,150 Paid-in capital 50,547,188 35,961,800 Accumulated deficit (26,258,223) (28,004,017) Accumulated other comprehensive income Unrealized loss on securities available for sale (13,841) (6,638) 24,291,798 7,966,295 Less treasury stock at cost, 22,000 common shares (75,625) (75,625) Total stockholders’ equity 24,216,173 7,890,670 $28,562,890 $10,837,477 QMED, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) For the For the For the For the Three Months Three Months Six Months Six Months Ended May 31, Ended May 31, Ended May 31, Ended May 31, 2005 2004 2005 2004 Revenue Disease management services $5,417,825 $3,667,570 $10,124,892 $7,406,791 Medical equipment 45,072 57,311 93,491 110,910 5,462,897 3,724,881 10,218,383 7,517,701 Cost of revenue Disease management services 1,810,278 2,649,454 3,593,852 4,613,439 Medical equipment 40,243 41,491 78,155 78,704 1,850,521 2,690,945 3,672,007 4,692,143 Gross profit 3,612,376 1,033,936 6,546,376 2,825,558 Selling, general and administrative expenses 2,092,306 2,104,908 3,791,098 3,851,063 Research and development expenses 308,826 243,871 576,852 498,290 Income (loss) from operations 1,211,244 (1,314,843) 2,178,426 (1,523,795) Interest expense (7,083) (9,026) (14,085) (15,724) Interest income 80,122 25,350 121,282 48,883 Loss in operations of joint ventures (386,393) (129,750) (457,278) (204,750) Other income 1,101 - 2,849 8,703 Income (loss) before income tax provision 898,991 (1,428,269) 1,831,194 (1,686,683) Provision for state income taxes (28000) (4,000) (85,400) (8,000) Net income (loss) $870,991 $(1,432,269) $1,745,794 $(1,694,683) Basic earnings (loss) per share Weighted average shares outstanding 16,578,310 14,737,312 16,212,014 14,695,582 Basic earnings (loss)per share $.05 $(.10) $.11 $(.12) Diluted earnings income (loss) per share Weighted average shares outstanding 18,454,850 14,737,312 18,291,267 14,695,582 Diluted earnings (loss) per share $.05 $(.10) $.10 $(.12)
Except for historical information contained herein, matters discussed in this news release are forward-looking statements that involve risks and uncertainties. They include but are not limited to those relating to the timely implementation of programs, the impact of competitive product introductions, acceptance and pricing, and those risks detailed in the Company’s filings with the Securities and Exchange Commission (SEC). Actual results may differ materially from any forward-looking statements due to these risks and uncertainties.
QMed, Inc.
CONTACT: Robert Mosby of QMed, Inc., +1-732-544-5544 x1107
Web site: http://www.qmedinc.com/