Access Plans USA, Inc. - Financial Highlights
(dollars in thousands except per share amounts)
Quarter Ended September 30,
September 30, Year-To-Date
------------------------- --------------------------
% %
2008 2007 Change 2008 2007 Change
---- ---- ------ ---- ---- ------
Revenues $ 8,688 $ 7,482 16% $ 26,895 $ 20,365 32%
Gross margin (1) 2,664 2,346 14% 8,050 7,139 13%
Net loss:
Continuing
operations (2) $ (126) $ (3,794) *** $ (1,112) $ (5,797) ***
Discontinued
operations (702) (3,970) *** (1,085) (7,743) ***
-------- -------- -------- --------
Total net
loss $ (828) $ (7,764) *** $ (2,197) $(13,540) ***
======== ======== ======== ========
Net loss per
diluted share $ (0.04) $ (0.38) *** $ (0.11) $ (0.73) ***
-------- -------- -------- --------
Core earnings
(loss) (3) $ 117 $ 47 149% $ 282 $ (123) ***
======== ======== ======== ========
1) Gross margin comprises total revenue less commissions, provider
network benefit costs, other costs directly related to revenue
generation, and interest expense
2) Continuing operations comprise the results of our Insurance
Marketing and Consumer Plan divisions, plus the costs of our
Corporate and Other activities - primarily expenses attributable
to operating as a public company.
3) Core earnings, a non-GAAP measure, comprise pre-tax income from
continuing operations before charges for depreciation,
amortization, non-cash stock compensation, goodwill and other non-
cash charges, restructuring charges, and significant
legal/settlement costs related to prior year activities.
A reconciliation to our GAAP results is set forth in a table included
in this news release.
*** Not meaningful.
IRVING, Texas, Nov. 14, 2008 (GLOBE NEWSWIRE) -- Access Plans USA, Inc. (Nasdaq:AUSA), a developer and nationwide distributor of quality affordable consumer driven healthcare programs designed to deal with the rising costs of healthcare, reported its financial results for the quarter ended September 30, 2008.
The 16% increase in third quarter revenue to $8,688,000 reflects a 24% growth in Insurance Marketing revenue and increased revenue attributable to Consumer Plan's October 1, 2007 acquisition of Protective Marketing Enterprises, Inc. (PME). Core earnings grew to $117,000 for the quarter and $282,000 year-to-date. The company believes that "core earnings" better recognizes the underlying operating activity - the table set forth later in this news release provides a reconciliation of this non-GAAP financial measure to our reported GAAP results. The third quarter loss of $126,000 from continuing operations reflects a substantial reduction in prior quarter losses. This loss comprises core earnings adjusted to include non-cash depreciation, amortization and stock compensation costs of $211,000 and a provision for state franchise expense.
During the third quarter of 2008, in connection with the Company's agreement to merge with Alliance HealthCard, Inc., which was announced yesterday, the Company has undertaken an initiative to exit the third-party administration market. Accordingly, our El Paso-based Regional Healthcare has been reclassified as a discontinued operation. Discontinued operations also include the results of ACP Agency, which prior to the second quarter of 2008 were included in the Insurance Marketing division.
"Our third quarter results were fairly consistent with second quarter operating results," said Ian R. Stuart, Interim President and Chief Executive Officer of Access Plans USA. "While we generated further growth in our Insurance Marketing division and a modest Consumer Plan division earnings contribution, these combined results were insufficient to cover the substantial costs of operating as public company and significant Regional Healthcare division losses, which are now reported as discontinued operations.
"Based on our year-to-date performance and our present limited capital resources, I firmly believe that the announced merger agreement with Alliance is the best opportunity to restore value for our shareholders and to offer them the prospect of an improved return on their investment," Stuart said.
Additional financial information is set forth below:
* Condensed Consolidated Statement of Operations, Cash Flow and Balance Sheet Data * Reconciliation of GAAP to Non-GAAP (Core Earnings) Financial Measures * Supplementary Financial Data
About Access Plans USA
Access Plans USA provides access to affordable healthcare. We develop and distribute quality affordable consumer driven healthcare programs for individuals and families. Our products and programs are designed to deal with the rising costs of healthcare. They include health insurance plans and non-insurance healthcare discount programs to help provide solutions for the millions of Americans who need access to affordable healthcare. We are committed to assuring that our clients have access to the healthcare that they need at prices they can afford. For more information on Access Plans USA, Inc. please visit www.accessplansusa.com.
The Access Plans USA, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3487
Disclaimer
Certain statements included in this news release constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology such as "anticipate", "believes", "expects", "may", "will", or "should", or other variations thereon, and by discussions of strategies that involve risks and uncertainties. Access Plans USA, Inc. actual results or industry results may be materially different from any future results expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include those set forth under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2007 and each of the Quarterly Reports on Form 10-Q filed since such date. The Company undertakes no obligation to update any forward-looking statements or to make any other forward-looking statement, whether as a result of new information, future events, or otherwise.
Access Plans USA, Inc.
Condensed Consolidated Statements of Operations, Cash Flow
and Balance Sheet Data
(dollars in thousands except per share amounts)
Quarter Ended Nine Months Ended
September 30, September 30,
------------------- -------------------
2008 2007(1) 2008 2007(1)
---- ------- ---- -------
Statement of Operations
Data
-----------------------
Total revenue $ 8,688 $ 7,482 $ 26,895 $ 20,365
Direct expenses 6,024 5,136 18,845 13,226
-------- -------- -------- --------
Gross margin 2,664 2,346 8,050 7,139
Personnel, general and
administrative costs and
depreciation/amortization 2,758 2,637 8,959 8,723
Restructuring and
impairment charges -- 3,977 164 4,673
-------- -------- -------- --------
Total operating
expenses 2,758 6,614 9,123 13,396
-------- -------- -------- --------
Loss from continuing
operations before income
taxes (94) (4,268) (1,073) (6,257)
Income tax provision
(benefit) 32 (474) 39 (460)
-------- -------- -------- --------
Loss from continuing
operations (126) (3,794) (1,112) (5,797)
Loss from discontinued
operations (702) (3,970) (1,085) (7,743)
-------- -------- -------- --------
Net loss $ (828) $ (7,764) $ (2,197) $(13,540)
======== ======== ======== ========
Basic and diluted net
income (loss) per share:
Continuing operations $ (0.01) $ (0.19) $ (0.06) $ (0.31)
Discontinued operations (0.03) (0.19) (0.05) (0.42)
-------- -------- -------- --------
Total $ (0.04) $ (0.38) $ (0.11) $ (0.73)
======== ======== ======== ========
Statement of Cash Flows
Data
-----------------------
Net cash provided by (used
in):
Operating activities:
Continuing operations $ 161 $ 218 $ (1,085) $ 136
Discontinued operations (600) 145 (592) 553
-------- -------- -------- --------
Total (439) 363 (1,677) 689
Investing activities 251 (62) 100 320
Financing activities (280) (651) 92 (735)
-------- -------- -------- --------
Net change in
unrestricted cash $ (468) $ (350) $ (1,485) $ 274
======== ======== ======== ========
September 30, December 31,
Balance Sheet Data 2008 2007
------------------ ---- ----
Unrestricted cash $ 1,226 $ 2,711
Restricted short-term investments 858 1,231
Total debt 1,394 1,255
Working capital 895 1,813
Goodwill and intangible assets 8,366 8,951
Shareholder's equity 9,071 11,257
============= ============
1) Reclassified certain amounts to conform to the current period's
presentation
Access Plans USA, Inc.
Reconciliation of GAAP to Non-GAAP (Core Earnings)
Financial Measures
(Dollars in Thousands)
2008 2007
------------------------- -------------------------
3Q 2Q 1Q 4Q 3Q 2Q
------- ------- ------- ------- ------- -------
Pre-tax
earnings/
(loss) -
GAAP
----------
* Consumer
Plan $ 120 $ 116 $ (268) $ 268 $(3,179) $ (640)
* Insurance
Marketing
(1) 259 190 182 141 (543) (150)
* Corporate (473) (594) (605) (595) (546) (597)
------- ------- ------- ------- ------- -------
Consoli-
dated
Total (94) (288) (691) (186) (4,268) (1,387)
------- ------- ------- ------- ------- -------
Reconciling
items - add
back:
------------
a) Goodwill
valuation
charges:
* Consumer
Plan -- -- -- -- 3,377 --
* Insurance
Marketing -- -- -- -- 600 --
b) Other
impairment
charges:
* Consumer
Plan -- -- -- 28 -- 522
* Insurance
Marketing -- -- -- -- -- 174
* Corporate -- 164 -- -- -- --
c) Intangible
asset
amortiz-
ation:
* Consumer
Plan 45 45 46 46 -- --
* Insurance
Marketing 149 149 149 149 149 149
d) Deprecia-
tion
charges
* Consumer
Plan 48 45 45 53 36 26
* Insurance
Marketing 9 9 9 7 6 5
* Corporate 1 1 2 2 2 2
e) Non-cash
stock
compen-
sation
expense
* Corporate (41) 15 36 34 52 59
f) Legal and
settle-
ment
costs:
* Consumer
Plan -- 45 334 53 93 406
* Corporate -- -- 50 -- -- --
Pre-tax core
earnings -
non-GAAP:
------------
* Consumer
Plan 213 251 157 448 327 314
* Insurance
Marketing
(1) 417 348 340 297 212 178
* Corporate (513) (414) (517) (559) (492) (536)
------- ------- ------- ------- ------- -------
Consolid-
ated
Total $ 117 $ 185 $ (20) $ 186 $ 47 $ (44)
======= ======= ======= ======= ======= =======
1) Insurance Marketing excludes the ACP Agency results reported as
discontinued operations
Access Plans USA, Inc.
Supplementary Financial Information (Dollars in Thousands) (1)
2008 2007
------------------------- -------------------------
3Q 2Q 1Q 4Q 3Q 2Q
------- ------- ------- ------- ------- -------
Consumer Plan
Division (2)
---------------
Member count at
quarter-end
Program 39,855 49,709 55,535 39,737 27,902 28,965
Network 33,483 38,278 37,950 46,718 n/a n/a
Revenues $ 3,304 $ 4,092 $ 3,906 $ 4,238 $ 3,146 $ 3,269
Gross margin 1,437 1,553 1,376 1,735 1,241 1,420
Core earnings 213 251 157 448 327 314
Operating
margin 6.4% 6.1% 4.0% 10.6% 10.4% 9.6%
======= ======= ======= ======= ======= =======
Insurance
Marketing
Division
-------------
Major medical
policies in-
force at
quarter-end 20,318 19,161 17,820 16,449 15,317 14,353
Revenues $ 5,376 $ 5,268 $ 4,923 $ 4,468 $ 4,331 $ 4,077
Gross margin 1,222 1,230 1,216 1,103 1,113 1,159
Core earnings 417 348 340 297 212 178
Operating
margin 7.8% 6.6% 6.9% 6.6% 4.9% 4.4%
======= ======= ======= ======= ======= =======
Total Revenues
--------------
Consumer Plan $ 3,304 $ 4,092 $ 3,906 $ 4,238 $ 3,146 $ 3,269
Insurance
Marketing 5,376 5,268 4,923 4,468 4,331 4,077
Corporate 8 13 5 4 5 10
------- ------- ------- ------- ------- -------
Consolidated
total $ 8,688 $ 9,373 $ 8,834 $ 8,710 $ 7,482 $ 7,356
======= ======= ======= ======= ======= =======
Total Core
Earnings
----------
Consumer Plan $ 213 $ 251 $ 157 $ 448 $ 327 $ 314
Insurance
Marketing 417 348 340 297 212 178
Corporate (513) (414) (517) (559) (492) (536)
------- ------- ------- ------- ------- -------
Consolidated
total $ 117 $ 185 $ (20) $ 186 $ 47 $ (44)
======= ======= ======= ======= ======= =======
1) Certain amounts have been reclassified to conform to the current
period's presentation
2) 4Q07 and later results include Protective Marketing Enterprises
- acquired October 1, 2007