EATONTOWN, N.J., Jan. 27 /PRNewswire-FirstCall/ -- QMed, Inc. today announced financial results for the fiscal year and fourth quarter ending November 30, 2005. Revenue for the year increased to $22,146,496 from $15,576,599 a year ago. Net income for the year totaled $3,885,545 or $0.24 per share, $0.21 per share on a diluted basis, compared to a net loss of $(1,739,445) or $(0.12) per share in the previous year. The Company had approximately $23.4 million of cash and investments at November 30, 2005.
Revenue for the three-month period ended November 30, 2005 increased to $6,423,479 up approximately 34% from $4,785,815 in the prior year’s quarter. Previously deferred revenues of approximately $1,400,000 were recognized as a result of achieving or surpassing performance goals on health plan contracts with HealthPartners ($400,000) and PacifiCare ($1,000,000). Net income for the quarter was $1,146,814 or $.07 per share, $.06 per share on a diluted basis, inclusive of approximately $116,000 related to the sale of net operating losses, compared to net income of $1,136,134 or $.08 per share, $.07 per share on a diluted basis, for the same period a year ago.
Michael W. Cox, QMed president and CEO said, “We are pleased to report this strong financial performance for the fourth quarter. Indeed, our Company’s performance for the entire year was quite robust, especially considering the development and operational costs associated with our QMedCare and Health e Monitoring initiatives. We are heartened that our programs continue to deliver superior and dependable quality and financial results to our health plan customers, as shown by the quarter’s recognition of deferred revenues from PacifiCare and HealthPartners contracts. Additionally, we had recognized revenue, previously deferred, under our contract with SummaCare for similar positive outcomes in the achievement of performance measures.”
“These achievements demonstrate yet again that our evidence-based clinical information management system performs extremely well in multiple geographies, as well as among Medicare seniors, and that it engages, and is supported by, physicians,” he continued. “Importantly, these performance achievements reinforce the already strong case for the announced transition to Medicare Advantage Special Needs Plan (MA SNP) business that we have begun in South Dakota with our partner, DAKOTACARE. That transition will shortly be accelerated with our filing in another state, this time for a wholly owned HMO license, so that we will own as well as operate the MA SNP in that new state, creating asset value for shareholders. Meanwhile, we have received positive receptions from several middle market Medicare Advantage health plans on partnering in Special Needs Plan business.”
“We are seeing increased interest in our Health e Monitoring programs from a number of diverse and prominent organizations, health plans among them. We expect that Health e Monitoring will make meaningful contributions to our Company this year and, like QMedCare, provide us with further diversification and industry leadership,” Cox added.
“We expect 2006 to be an active development year for the Company. The SNP project in South Dakota was launched a few days ago and it is too early to estimate enrollment for the quarter or the year. While there is confusion surrounding the Medicare Part D prescription drug benefit, our drug benefit design covers the so-called ‘doughnut hole’ and has been well received by pharmacies and practicing physicians in South Dakota.”
“Consequently, we recently notified CMS that we intend to submit a benefit design for 2007, which may include an expanded South Dakota SNP offering. Preliminary engagement for this project with physicians, institutions and community senior centers to explain the benefits of our SNP approach is proceeding satisfactorily. In this new effort we are building an MA SNP business from scratch with a deeply talented executive QMedCare team. We are competing in an emerging arena, and we get more than our usual share of questions from physicians, clinic administrators, hospitals and patients. With our growing experience in South Dakota, we are confident that this critical migration of our expertise is the right move for our Company. As a result, we expect to submit a freestanding HMO license application to New Jersey regulators within the next few weeks, with expectations of a January 2007 go-live date for this new wholly owned SNP. In keeping with this 2007 plan, we have advised CMS of our intention to apply for a chronically ill SNP in New Jersey, with a start date of January 1, 2007,” Cox concluded.
About QMed, Inc.
QMed provides evidence-based clinical information management systems around the country to its health plan customers. The system incorporates Disease Management services to patients and decision support to physicians. The Company’s QMedCare subsidiary specializes in serving high-risk populations of Medicare beneficiaries with its first project commencing in South Dakota in January 2006. Health e Monitoring is QMed’s subsidiary offering weight, obesity and health promotion programs. The Company has been selected in two Demonstrations 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 Consolidated Balance Sheets November 30, Assets 2005 2004 Current assets Cash and cash equivalents $ 4,051,046 $ 3,292,571 Investments in securities 19,348,503 2,097,362 Accounts receivable, net of allowance for doubtful accounts of $76,518 and $52,690, respectively 3,377,495 2,750,507 Inventory, net of reserve 30,887 38,355 Prepaid expenses and other current assets 411,608 440,620 27,219,539 8,619,415 Property and equipment, net of accumulated depreciation 1,058,295 1,180,050 Product software development costs, net 1,161,083 858,022 Accounts receivable, non-current 271,809 - Acquired intangibles, net 795,848 - Other assets 128,794 132,136 Investment in joint ventures 37,998 47,854 $30,673,366 $10,837,477 Liabilities and Stockholders’ Equity Current liabilities Accounts payable and accrued liabilities $ 1,577,385 $ 817,234 Leases payable, current portion 146,483 119,757 Accrued salaries and commissions 721,792 416,382 Fees reimbursable to health plans 39,000 161,178 Contract billings in excess of revenues 744,743 1,245,862 Deferred warranty revenue 12,253 23,652 Income taxes payable 62,610 16,000 3,304,266 2,800,065 Leases payable, long term 76,005 146,742 Contract billings in excess of revenue, long term 271,809 - 3,652,080 2,946,807 Commitments and contingencies Stockholders’ equity Common stock, $.001 par value, 40,000,000 shares authorized, 16,804,846 and 15,150,054 shares issued 16,782,806 and 15,128,054 outstanding, respectively 16,805 15,150 Paid-in capital 51,219,617 35,961,800 Accumulated deficit (24,118,472) (28,004,017) Accumulated other comprehensive income Unrealized losses on securities available for sale (21,039) (6,638) 27,096,911 7,966,295 Less treasury stock at cost, 22,000 common shares (75,625) (75,625) Total stockholders’ equity 27,021,286 7,890,670 $30,673,366 $10,837,477 QMED, INC. AND SUBSIDIARIES Consolidated Statements of Operations For the Three Months Ended November 30, 2005 2004 Revenue $ 6,423,479 $ 4,785,815 Cost of revenue 2,011,574 1,805,785 Gross profit 4,411,905 2,980,030 Selling, general and administrative expenses 2,866,660 1,665,666 Research and development expenses 399,111 196,599 Income from operations 1,146,134 1,117,765 Interest expense (6,242) (9,540) Interest income, net 179,700 16,332 Loss in operations of joint ventures (55,727) (214,147) Other income 637 - Income before income tax benefit (provision) 1,264,502 910,410 Gain on sale of state tax benefits 115,912 229,724 Provision for income taxes (233,600) (4,000) Net income $ 1,146,814 $ 1,136,134 Basic income per share Weighted average shares outstanding 16,751,233 14,920,523 Basic income per share $ 0.07 $ 0.08 Diluted income per share Weighted average shares outstanding 18,799,678 16,719,362 Diluted income per share $ 0.06 $ 0.07 QMED, INC. AND SUBSIDIARIES Consolidated Statements of Operations For the Years Ended November 30, 2005 2004 2003 Revenue $22,146,496 $15,576,599 $12,899,361 Cost of revenue 7,510,894 8,878,104 6,726,867 Gross profit 14,635,602 6,698,495 6,172,494 Selling, general and administrative expenses 8,720,287 7,288,783 6,875,834 Research and development expenses 1,323,397 903,921 905,360 Litigation settlement - - 230,000 Income (loss) from operations 4,591,918 (1,494,209) (1,838,700) Interest expense (27,294) (33,874) (25,595) Interest income, net 441,353 68,238 90,418 Loss in operations of joint ventures (847,830) (502,027) (362,499) Other income 3,486 8,703 - Income (loss) before income tax benefit (provision) 4,161,633 (1,953,169) (2,136,376) Gain on sale of state tax benefits 115,912 229,724 - Provision for income taxes (392,000) (16,000) (15,000) Net income (loss) $ 3,885,545 $(1,739,445) $(2,151,376) Basic income (loss) per share Weighted average shares outstanding 16,465,178 14,766,895 14,568,781 Basic income (loss) per share $ 0.24 $ (0.12) $ (.15) Diluted income (loss) per share Weighted average shares outstanding 18,457,101 14,766,895 14,568,781 Diluted income (loss) per share $ 0.21 $ (0.12) $ (.15)
QMed, Inc.
CONTACT: Robert Mosby of QMed, Inc., +1-732-544-5544 ext. 1107
Web site: http://www.qmedinc.com/
