CHICAGO, July 30, 2014 (GLOBE NEWSWIRE) -- Merge Healthcare Incorporated (Nasdaq:MRGE), a leading provider of innovative enterprise imaging, interoperability and clinical systems that seek to advance healthcare, today announced its financial and business results for the second quarter of 2014.
“I am proud to announce that for the third quarter in a row, Merge realized consistent, forward momentum in our financial results. Revenue and adjusted EBITDA continued to grow. In addition, our cardiology business achieved its highest sales quarter ever,” said Justin Dearborn, CEO of Merge Healthcare. “From a solutions standpoint, we made good headway in the adoption of our subscription-based services for Merge eClinicalOS™ (eCOS), iConnect® Network and iConnect® Cloud Archive. We also successfully launched iConnect® Retinal Screening -- the first end-to-end, cloud-based platform that enables automated, early screening detection of diabetic complications, one of the highest healthcare costs realized worldwide. This new advanced interoperability solution gives our large integrated delivery network (IDN) and international customers as well as accountable care organizations (ACOs) an attractive solution to assist them with their population health strategies. Overall, we are excited about this service, as it gives Merge yet another software-as-a-service model to capitalize on and build our recurring revenue stream. With all of these factors combined, I remain optimistic about the remainder of 2014.”
Financial Summary:
* Adjusted EBITDA increased in the second quarter of 2014 to $11.2 million, representing 21% of pro forma revenue, compared to $8.5 million and 15% in the second quarter of 2013;
* Adjusted net income grew to $4.4 million (or $0.05 per share) in the second quarter of 2014 compared to $0.9 million (or $0.01 per share) in the second quarter of 2013, which compares to a GAAP net loss in the second quarter of 2014 of $4.0 million (including a charge of $4.8 million associated with the refinancing of our debt), or a loss of $0.04 per share, and a GAAP net loss in the second quarter of 2013 of $28.1 million (including a charge of $23.8 million associated with the refinancing of our debt), or a loss of $0.30 per share;
* Sales were $53.8 million ($54.1 million on a pro forma basis) in the second quarter of 2014 compared to $57.2 million ($57.6 million on a pro forma basis) in the second quarter of 2013;
* Subscription backlog grew to $54.6 million, a 12% increase from the second quarter of 2013; and
* Cash generated from business operations was $8.3 million in the second quarter of 2014 compared to $10.6 million in the prior year, which compares to net cash provided by (used in) operating activities on the statement of cash flows of $4.7 million and ($7.3) million, respectively. Business Highlights: * Achieved an all-time record for quarterly Cardiology bookings, recording an increase of over 50% compared to the second quarter of 2013 and contracting seven net new customers;
* Executed seven additional iConnect Network customer agreements for a total of 29 customers since launching the solution in 2013 and signed a second radiology information system (RIS) vendor as a reseller of iConnect Network;
* Completed two, large net new vendor-neutral archive (VNA) deals, including Comanche County Memorial Hospital. The hospital will use Merge’s iConnect® Enterprise Archive and iConnect® Access solutions to archive and share images to ensure the seamless flow of patient data, meet Meaningful Use Stage 2 requirements and improve disaster recovery and operational workflow across their continuum of care;
* Realized significant growth with iConnect Cloud Archive (formerly Merge Honeycomb® Archive), signing 20 new customers in past 12 months;
* Launched iConnect Retinal Screening, the first end-to-end, automated, software-as-a-service solution for early screening and detection of diabetic retinal disease. This advanced interoperability, cloud-based platform complements the existing population health strategy of integrated delivery systems and accountable care organizations and eliminates many of the most common barriers to successful screening programs, including IT costs and the ability to capture meaningful eye photographs by normal medical assistants; and
* Went live with over 70 eCOS studies in Q2, increasing clinical sites by 25%, users by more than 27% and active subjects by 30% since the end of the first quarter. These results demonstrate continued growth in eCOS utilization.
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