Aveta Reports 2006 First Quarter Results

32 Percent Growth in Membership and First Quarter Earnings of $0.16 Per Share


NEW YORK, May 15, 2006 (PRIMEZONE) -- Aveta Inc., one of the largest companies focusing on Medicare Advantage and a leader in addressing the healthcare needs of the chronically ill, reported today that revenues for the first quarter of 2006 totaled $293.7 million, an increase of 43.2% over pro forma revenues of $205.1 million for the first quarter of 2005. Earnings before interest, taxes, depreciation and amortization (EBITDA) grew 78.9% to $31.3 million in Q1 2006, compared to pro forma EBITDA of $17.5 million in Q1 2005. Adjusted first quarter earnings were $0.18 per share excluding stock option expense. Net income for the quarter was $12.3 million or $0.16 per share which includes $0.02 per share for stock option expense. Aveta's membership base of enrolled Medicare beneficiaries grew by more than 11,000 during the first quarter of 2006 to a total of 142,000, up 32% from the corresponding pro forma figure for the first quarter of 2005.

Premium revenues from the company's core managed care businesses, which focus on meeting the healthcare needs of seniors and the chronically ill, totaled $284.9 million in the first quarter of 2006, up 44.2% over the corresponding pro forma figure for the first quarter in 2005. Premium revenues accounted for more than 97% of the company's total revenues. Medical costs totaled $227.0 million for the quarter, representing a medical loss ratio of 79.7%, compared to a pro forma medical loss ratio of 83.3% in the first quarter of 2005. The improvement in the medical loss ratio for the quarter reflects greater medical cost efficiencies including favorable prior period reserve development. Administrative expenses were $34.9 million in the first quarter of 2006, representing an administrative expense ratio of 11.9%, compared to a pro forma administrative expense ratio of 11.0% in the first quarter of 2005.

"Aveta's continues to leverage its community medical management expertise to better serve the special needs of the chronically ill and strengthen our position in the markets we serve," said Timothy J. O'Donnell, President and Chief Executive Officer of Aveta. "During the first quarter of 2006, our operating companies in Puerto Rico, California and Illinois all posted solid growth. Aveta's MMM subsidiary, which pioneered Medicare Advantage in Puerto Rico, broke new ground during the quarter with the launch of two new Medicare Advantage special needs plans (SNPs) serving the chronically ill and dual-eligible beneficiaries. Our recently announced acquisition of PMC Medicare Choice in Puerto Rico will expand our provider network and strengthen our provider relationships on the island, enhancing our ability to better serve the rapidly growing Medicare Advantage population there."

Aveta also launched two additional chronic SNP initiatives in the quarter, for populations in Cook County, Illinois, and the Inland Empire of Southern California. Medicare beneficiaries with qualifying conditions can enroll in these plans throughout the rest of the calendar year due to their one-time exemption from standard CMS lock-in provisions.

"Aveta remains committed to improving the healthcare for all Medicare beneficiaries," said O'Donnell, "and especially for the large and growing segment with one or more chronic illnesses."

About Aveta Inc.

Aveta is one of the largest companies focusing on Medicare Advantage and a leader in addressing the unique healthcare needs of the chronically ill. Caring for over 140,000 Medicare beneficiaries, Aveta is the 5th largest for-profit Medicare Advantage enterprise, and operates more Chronic SNPs than any other company. Aveta has a successful track record of managing care for seniors achieved through its core competency of community medical management. Aveta is headquartered in Fort Lee, New Jersey and currently has operating subsidiaries in Southern California, Puerto Rico, and Illinois.



                     AVETA INC. AND SUBSIDIARIES
                  Condensed Statements of Income (1)

 ($ in 000s)                                Quarter Ended March 31,
                                            2006             2005
                                           Actual          Pro Forma
                                          --------         ---------
 Premium revenue                          $284,865          $197,498
 Management fees & other                     7,209             6,580
 Investment income                           1,614             1,040
                                          --------          --------
 Total Revenue                            $293,688          $205,118
                                          --------          --------
 Medical costs                             226,953           164,551
 Selling, general and
  administrative                            34,902            22,634
 Depreciation & amortization                 4,500             4,001
                                          --------          --------
 Total Operating Expenses                 $266,355          $191,186
                                          --------          --------
 Operating income                           27,333            13,932
 Interest expense                            6,268             3,363
 Stock option and related expense            2,437                66
 Minority interests                            562               391
                                          --------          --------
 Pre-tax Income                           $ 18,066          $ 10,112
 Taxes                                       5,804             2,991
                                          --------          --------
 Net income                               $ 12,262          $  7,121
                                          --------          --------
 Other Operating and Financial
  Information:
 Membership  (in 000s)
  Senior                                     142.0             108.0
  Commercial                                 202.0             212.0
 EBITDA                                   $ 31,300          $ 17,500
 Medical Loss Ratio                          79.7%             83.3%
 Administrative Cost Ratio                   11.9%             11.0%
 Total Cash and Investments               $229,100          $115,000
 Total Assets                             $622,600          $347,900
 Total Debt                               $286,300          $144,600
 Shareholders' Equity                     $ 52,400          $ 74,300
 Earnings per share                       $   0.16               N/A
 Adjusted Earnings per share              $   0.18               N/A
 Weighted average common shares
  outstanding:
                        Basic               77,391               N/A
                        Diluted             77,953               N/A

 Note 1: The financial information for 2005 was prepared on a pro forma 
 basis as if Aveta Inc. owned all of its operating subsidiaries for the  
 entire year of 2005. NAMM California and NAMM Illinois were acquired by
 Aveta in August 2005.

 Note 2: EBITDA reflects net income with the following items added back:
 interest expense, taxes, depreciation and amortization, noncash stock
 options and related charges.

 Note 3: 2006 Adjusted Earnings per Share is prior to noncash stock option
 related expense of $2,437 pre-tax, or $1,655 after tax.


                     AVETA, INC. AND SUBSIDIARIES
   (Formerly known as Aveta Holdings, LLC and Green Field, II, LLC)
                      CONSOLIDATED BALANCE SHEETS
              As of March 31, 2006 and December 31, 2005

                            (In thousands)

                                    Mar. 31, 2006       Dec. 31, 2005
                                    -------------       -------------
 Assets
 Current assets:
  Cash and cash equivalents             $ 160,117           $  67,135
  Investments                              69,027              38,930
                                    -------------       -------------
  Total cash and investments              229,144             106,065
 Premiums receivable, net                  50,970              48,271
 Deferred income tax                        3,042               2,241
 Prepaid expenses and other
  current assets                            4,866               4,760
                                    -------------       -------------
  Total current assets                  $ 288,022           $ 161,337
 Property and equipment, net                8,420               8,093
 Goodwill                                 218,986             218,955
 Other intangible assets, net              95,826              99,483
 Debt issue costs                           8,348               8,734
 Other assets                               3,009               2,166
                                    -------------       -------------
  Total assets                          $ 622,611           $ 498,768
                                    =============       =============
 Liabilities and Stockholders'
  Equity and Members' Equity
 Current liabilities:
   Medical claims liabilities           $ 110,594           $  91,559
   Accounts payable and accrued
    expenses                               39,801              26,626
   Current maturities of long-term
    debt                                    3,650               4,200
   Income taxes payable                    16,582              11,403
   Unearned premiums                       75,707                  --
   Due to Aveta Health                      4,266               4,315
   Other current liabilities                   --                  --
                                    -------------       -------------
    Total current liabilities           $ 250,600           $ 138,103
 Long-term debt, excluding
  current installments                    282,670             282,800
 Deferred income taxes                     36,180              38,096
                                    -------------       -------------
  Total liabilities                     $ 569,450           $ 458,999
                                    -------------       -------------
 Minority interests                           787               1,548
 Stockholders' equity and
  members' equity:
  Preferred stock, par value
   $0.001 per share, 5000 shares
   authorized; -0- shares issued
   and outstanding                             --                  --
  Common Stock, par value $0.001
   per share, 250,000 shares
   authorized, 91,779,775 and
   88,000,000 shares issued and
   outstanding at March 31, 2006
   and December 31, 2005
   respectively                                92                  88
  Additional paid in capital              216,013             166,712
  Members interest                             --                  --
  Retained earnings                        11,377                (885)
  Accumulated other comprehensive
   income                                    (620)                (56)
  Less treasury stock at cost,
   13,750 and 10,000 shares at
   March 31, 2006 and December 31,
   2005, respectively                    (174,488)           (126,900)
  Unearned compensation                         0                (738)
   Total stockholders' equity and
    members' equity (deficit)           $  52,374           $  38,221
                                    -------------       -------------
   Total liabilities, minority
    interest, and stockholders'
    equity and members' equity          $ 622,611           $ 498,768
                                    =============       =============

            

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