BIRMINGHAM, Ala., May 1 /PRNewswire-FirstCall/ -- Emageon Inc. today reported financial results for its first quarter ended March 31, 2006.
Revenue for the quarter was a record $26.6 million, a 134% increase over first quarter 2005 revenue of $11.3 million. The net loss for the quarter was $7.0 million, or $0.34 per share, including $1.2 million, or $0.06 per share, in expenses related to the merger and reorganization of Camtronics Medical Systems, Ltd. into the Company's operations; $1.0 million, or $0.05 per share, in amortization of intangible assets acquired on November 1, 2005 in the Camtronics acquisition; and non-cash expense of $0.6 million, or $0.03 per share, for stock options-based compensation as a result of the Company's adoption of Statement of Financial Accounting Standards No. 123R as of January 1, 2006. The net loss for the prior year quarter ended March 31, 2005 was $4.8 million, or $0.42 per share. On a pro forma basis, assuming the Company's February 9, 2005 initial public offering had occurred on January 1, 2005, the Company's net loss per share in the prior year quarter ended March 31, 2005 would have been $0.24 per share. A reconciliation of actual net loss per share to pro forma net loss per share for this prior year period is included below.
Cash used in operations for the quarter was $4.4 million. At March 31, 2006 cash and marketable securities totaled $15.6 million compared to $20.5 million at December 31, 2005.
"We are pleased to report another quarter of record revenue," said Chuck Jett, Chairman, President, and CEO of Emageon. "I believe we are on track to achieve our financial goals in 2006. We continue to see growth opportunities in our business as hospitals adopt our product offerings as a way to lower their costs and provide better service to physicians and better care to patients."
The Company confirmed its previously announced revenue and earnings guidance for the full year 2006. The Company continues to expect to have revenue in the range of $122 to $125 million for the year, and earnings in the range of $0.02 to $0.06 per share, including non-cash expenses of $0.18 per share for the amortization of intangible assets acquired in the Camtronics acquisition and an incremental $0.10 per share for stock options-based compensation expense, but excluding the effects of expenses incurred in the merger and reorganization of the operations of Camtronics. The Company believes Camtronics merger and reorganization costs will approximate $6 million for the full year 2006.
Emageon will host a conference call for investors on May 1, 2006 at 5:00 P.M. EDT to discuss its financial results for the quarter. The call will be webcast by Thomson/CCBN and can be accessed at Emageon's web site at www.emageon.com. The dial-in telephone number for the call is 800-299-7635 (internationally, at 617-786-2901), passcode 38827967. Replay is available from 7:00 P.M. EDT, May 1, 2006 until 11:59 P.M. EDT, May 11 at 888-286-8010 (internationally, at 617-801-6888), passcode 13353042.
The webcast is also being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.fulldisclosure.com,Thomson/CCBN's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
This press release contains forward-looking statements about Emageon which represent the Company's current views with respect to, among other things, future events and financial performance. Any forward-looking statements contained in this press release are based on Emageon's historical performance and on current plans, beliefs and expectations. Actual results may differ materially from those expressed or implied by such forward-looking statements as a result of various risks, uncertainties and other factors beyond its control. These risks, uncertainties and other factors include, among others, the risk that it may not compete successfully against larger competitors, risks associated with its history of operating losses, the risk that it may not manage its growth effectively, the risk that acquisitions could result in integration difficulties, dilution or other adverse financial consequences, risks associated with its reliance on continuing relationships with large customers, the risk of significant product errors or product failures, the risk of its reliance on reseller arrangements for important components of its solution, the risk that it may not respond effectively to changes in its industry, the risk of its customers' reliance on third party reimbursements, and the risk of the potential impact on its business of FDA regulations and other applicable health care regulations. Additional information concerning these and other factors that could affect Emageon's financial and operating results may be found under the heading "Risk Factors" and elsewhere in the Company's Form 10-K for the year ended December 31, 2005, which was filed with the Securities and Exchange Commission on March 31, 2006. Emageon undertakes no obligation to update these forward-looking statements or other information provided in this press release except as may be required by law.
About Emageon
Emageon provides an enterprise-level advanced visualization and infrastructure solution for the clinical analysis and management of digital medical images within multi-hospital networks, community hospitals and diagnostic imaging centers. Emageon's software, including its HeartSuite set of cardiology solutions from its Camtronics subsidiary, provides physicians in multiple medical specialties such as cardiology, radiology, and orthopedics, among others, with dynamic tools to manipulate and analyze images in two and three dimensions. With these tools physicians have the ability to better understand internal anatomic structure and pathology, which can improve clinical diagnoses, disease screening and therapy planning. Emageon's open standards-based solution is designed to help customers improve staff productivity, automate complex medical imaging workflow, lower total cost of ownership and provide better service to physicians and patients. For more information, please visit www.emageon.com.
Unaudited Statements of Operations In Thousands, Except Share and Per Share Amounts Quarter ended March 31 2006 2005 (1) Revenue: System sales $17,269 $7,719 Support services 9,309 3,617 Total revenue 26,578 11,336 Cost of revenue: System sales 13,284 4,823 Support services 5,795 3,083 Total cost of revenue 19,079 7,906 Gross profit 7,499 3,430 Operating expenses: Research and development 4,130 2,534 Sales and marketing 4,002 2,804 General and administrative 4,318 2,291 Amortization of intangible assets related to Camtronics acquisition 885 - Merger and reorganization costs related to Camtronics acquisition 1,204 - Total operating expenses 14,539 7,629 Operating loss (7,040) (4,199) Interest income 156 232 Interest expense (109) (851) Net loss $(6,993) $(4,818) Net loss per share-basic and diluted $(0.34) $(0.42) Weighted average shares outstanding- basic and diluted 20,583,048 11,531,986 (1) Certain reclassifications have been made to prior year operating expenses to conform with the current year presentation. Summary Consolidated Balance Sheets Dollars In Thousands (Unaudited) March 31, December 31, 2006 2005 ASSETS: Current assets: Cash and cash equivalents $15,597 $15,520 Marketable securities - 4,951 Trade accounts receivable, net 28,558 29,261 Prepaid expenses and other current assets 3,663 3,052 Inventories 9,726 8,031 Total current assets 57,544 60,815 Property and equipment, net 21,102 21,433 Other noncurrent assets 1,471 1,419 Intangible assets, net 32,929 34,277 Total assets $113,046 $117,944 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $20,947 $22,023 Deferred revenue 27,395 25,312 Current portion of long-term debt and capital lease obligations 2,668 2,763 Total current liabilities 51,010 50,098 Long-term deferred revenue 2,899 3,221 Long-term debt and capital lease obligations 395 986 Total liabilities 54,304 54,305 Stockholders' equity 58,742 63,639 Total liabilities and stockholders' equity $113,046 $117,944 Pro Forma Net Loss Per Share for the Quarter Ended March 31, 2005
The following table presents the Company's net loss per share for the first quarter of 2005 on a pro forma basis, a non-GAAP financial measurement, as if the Company's initial public offering of its common stock, which occurred February 9, 2005, had occurred on January 1, 2005. The Company believes that presentation of the net loss per share for the first quarter of 2005 utilizing the Company's post-initial public offering capital structure enhances an overall understanding of its current and historical financial performance and provides an additional meaningful measure of operating performance by enhancing the consistency and comparability of reported financial results, enabling investors to more thoroughly evaluate current performance in comparison to past performance. This information will necessarily differ from comparable information that may be provided by other companies and should not be considered in isolation or as an alternative to the Company's operating and other financial information determined under U.S. generally accepted accounting principles.
The table presents the adjustments made to actual weighted average shares of common stock outstanding in order to derive weighted average common stock outstanding on the pro forma basis described above. The resulting pro forma net loss per share for the period was calculated by dividing the actual net loss for the period by the pro forma weighted average common stock outstanding as determined in the table.
Quarter Ended March 31, 2005 Weighted average shares outstanding 11,531,986 Effects of: Conversion of preferred stock 5,301,223 Required exercise of warrants 262,573 Release of escrowed common stock at completion of initial public offering 83,625 Issuance of common stock in initial public offering 2,844,444 Total pro forma shares outstanding 20,023,851 Pro forma net loss per share $(0.24)
Emageon Inc.CONTACT: W. Randall Pittman of Emageon, +1-205-980-7551; or Susan Noonanof The SAN Group, LLC, +1-212-966-3650
Web site: http://www.emageon.com/
