Air Methods Announces Year 2006 Financial Results and Provides First Quarter 2007 Update
03/08/07
DENVER, March 8 /PRNewswire-FirstCall/ -- Air Methods Corporation (Nasdaq: AIRM), the largest air medical transportation company in the world, reported revenue and net income for the year and fourth quarter ended December 31, 2006.
For the year, revenue increased 16% to $319.5 million compared to $276.2 million in the prior year. Net income was $17.2 million or $1.40 per diluted share compared to $11.8 million or $1.02 per diluted share. As previously disclosed, the current year results include a $0.5 million ($0.04 per diluted share) increase in income tax expense above the highest federal tax rate of 35%, resulting from the application of the new higher expected rate to deferred income tax liabilities. The prior year results included a loss on early extinguishment of debt, net of income taxes, of $1.9 million or $0.16 per diluted share.
For the fourth quarter, revenue increased 5% to $77.5 million as compared with $73.6 million during the prior-year period. Net income decreased to $1.2 million or $0.10 per diluted share compared to net income of $3.5 million or $0.29 per diluted share in the prior-year period. As previously disclosed, the current-year quarter results include a $0.8 million ($0.06 per diluted share) increase in income tax expense above the highest federal tax rate of 35%, resulting from the application of the new higher expected rate to current and deferred income tax liabilities. In addition the current-year quarter net income was decreased by $0.6 million, or $0.05 per diluted share, from the impact of an aviation accident experienced in December 2006.
The current and prior period revenue amounts are presented net of reserves for uncompensated care, pursuant to the recently announced change in accounting policy.
The decrease in net income for the fourth quarter is primarily attributed to the items discussed above. In addition, net revenue per community-based transport was below expectation for the quarter due to lower than anticipated collections. Net revenue per community-based transport decreased slightly from $5,996 in the prior-year quarter to $5,958 in the current period, despite price increases during 2006. The lower than anticipated collection rate was attributed to normal fluctuations inherent in the collection process, since change in payer mix was not significant between the two periods.
During the fourth quarter of 2006, total patients transported within community-based operations were 8,382 as compared with 7,809 during the prior- year quarter. Patients transported for community bases in operation greater than one year (Same-Base Transports) increased by 78 patients or 1%, while weather cancellations for these same bases increased by 42 transports, compared with the prior-year period. For the year 2006, Same-Base Transports increased by 615 or 2%, while weather cancellations for community-bases in operation greater than one year increased by 173 patient transports, as compared with the prior year.
The Company also provided an update on first quarter 2007 flight volume. Same-Base Transports within community-based operations through February were down 185 patient transports or 4% as compared with the prior-year period, while weather cancellations for these same bases increased 26 transports compared with the prior-year period. In addition, reduction in requests for service, which are not reflected in weather cancellations, was attributed to more severe weather conditions.
Aaron Todd, CEO of Air Methods, commented, "We are proud of our 2006 financial results. Our ability to generate strong growth in earnings during a period of high inflation in our cost of labor and flight operations is evidence of our strong position within the air medical industry. While our quarterly results continue to reflect high variability, the long-term trends continue to demonstrate year-over-year growth in both revenue and earnings."
Mr. Todd added, "Despite the impact of weather on transports during the first two months of 2007, we remain very optimistic in our ability to achieve year-over-year earnings growth. We anticipate improving margins within our hospital-based operations in 2007 due to projected moderation in our maintenance expenditures and to anticipated price increases on contract renewals. We expect continued growth in Same-Base Transports for community- based operations, adjusted for weather variations, and will continue to expand the number of operating bases in 2007. In addition, reimbursement rates continue to be positively affected by periodic price increases, as reimbursement rates for insured patients have kept pace with recent increases overall."
The Company will discuss these results in a conference call scheduled today at 4:15 p.m. Eastern. Interested parties can access the call by dialing (888) 396-5640 (domestic) or (706) 643-0580 (international) or by accessing the web cast at www.airmethods.com. A replay of the call will be available at (800) 642-1687 (domestic) or (706) 645-9291 (international), access number 1366633, for 3 days following the call; and the web cast can be accessed at www.airmethods.com for 30 days.
Air Methods Corporation (www.airmethods.com) is a leader in emergency aeromedical transportation and medical services. The Air Medical Services Division is the largest provider of air medical transport services for hospitals. The LifeNet Division is one of the largest community-based providers of air medical services. The Products Division specializes in the design and manufacture of aeromedical and aerospace technology. The Company's fleet of owned, leased or maintained aircraft features over 200 helicopters and fixed wing aircraft.
Forward Looking Statements: This news release includes certain forward- looking statements, which are subject to various risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors, including but not limited to the size, structure and growth of the Company's air medical services and products markets; the collection rates for patient transports; the continuation and/or renewal of air medical service contracts; the acquisition of profitable Products Division contracts and other flight service operations; the successful expansion of the community-based operations; and other matters set forth in the Company's public filings.
CONTACTS: Aaron D. Todd, Chief Executive Officer, (303) 792-7413 or Joe
Dorame at Lytham Partners, LLC, at (602) 889-9700. Please contact Christine
Clarke at (303) 792-7579 to be included on the Company's fax and/or mailing
list.
- FINANCIAL STATEMENTS ATTACHED -
AIR METHODS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Amounts in thousands)
December 31, 2006 December 31, 2005
ASSETS
Current assets:
Cash and cash equivalents $4,219 $3,218
Trade receivables, net 100,559 83,567
Other current assets 35,083 25,726
Total current assets 139,861 112,511
Net property and equipment 95,575 93,530
Other assets, net 14,721 15,491
Total assets $250,157 $221,532
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable related to assets held
for sale $9,560 $6,446
Current portion of indebtedness 9,963 10,056
Accounts payable, accrued expenses
and other 28,306 29,170
Total current liabilities 47,829 45,672
Long-term indebtedness 62,346 58,392
Other non-current liabilities 32,668 31,257
Total liabilities 142,843 135,321
Total stockholders' equity 107,314 86,211
Total liabilities and stockholders'
equity $250,157 $221,532
AIR METHODS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except share and per share amounts)
Quarter Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
Revenue:
Flight operations $76,469 $71,513 $313,879 $268,249
Product operations 1,009 2,120 5,625 7,929
Total revenue 77,478 73,633 319,504 276,178
Expenses:
Operating expenses 59,084 53,196 231,317 199,051
General and administrative 10,521 9,997 40,710 36,971
Depreciation and
amortization 3,306 3,131 12,910 12,021
72,911 66,324 284,937 248,043
Operating income 4,567 7,309 34,567 28,135
Interest expense (1,473) (1,310) (5,821) (5,956)
Loss on early
extinguishment of debt -- -- -- (3,104)
Other, net 406 256 1,598 950
Income before income taxes 3,500 6,255 30,344 20,025
Income tax expense (2,299) (2,777) (13,144) (8,193)
Net income $1,201 3,478 17,200 11,832
Income per common share: $0.10 0.31 1.46 1.07
Basic $0.10 0.29 1.40 1.02
Diluted
Weighted average common
shares outstanding:
Basic 11,819,102 11,171,835 11,748,107 11,058,971
Diluted 12,344,396 11,843,815 12,306,047 11,654,885
SOURCE Air Methods Corporation
-0- 03/08/2007
/CONTACT: Aaron D. Todd, Chief Executive Officer of Air Methods
Corporation, +1-303-792-7413; or Joe Dorame at Lytham Partners, LLC,
+1-602-889-9700, for Air Methods Corporation/
/Web site: http://www.airmethods.com /
(AIRM)
CO: Air Methods Corporation
ST: Colorado
IN: AIR HEA MTC
SU: ERN ERP CCA
MH-IL
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8696 03/08/2007 16:01 EST http://www.prnewswire.com
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