Orion HealthCorp, Inc. (AMEX: ONH) today announced its financial
results for the second quarter and six months ended June 30, 2006.
Terrence L. Bauer, chief executive officer of Orion HealthCorp,
said, "We continue to make progress on a number of fronts. During
the second quarter, we were EBITDA positive, demonstrating that our
cost controls and consolidation efforts are producing the desired
results. Also, we are hard at work executing our business plan
that, in addition to reducing costs, includes strategic growth
initiatives. We have identified several acquisition candidates that
we believe would complement our existing revenue cycle management
business and are discussing potential transactions. Halfway through
2006, we believe we are well-positioned with positive momentum for
the remainder of the year." The results for the three months and
six months ended June 30, 2006 and 2005, respectively, include the
consolidated results of Orion HealthCorp, with two of its business
units: Integrated Physician Solutions, Inc., which provides
business and management services to pediatric physician groups, and
Medical Billing Services, Inc., which provides physician billing
and collection services and practice management solutions,
primarily to hospital-based physicians. The surgery center business
operated under the name "SurgiCare" is reported as discontinued
operations for the three months and six months ended June 30, 2006
and 2005. For the three months ended June 30, 2006, net operating
revenues were $6.9 million compared with $7.7 million for the same
period in the prior year. Loss from continuing operations was
$481,000, or $0.04 per basic share, for the second quarter of 2006
compared with a loss from continuing operations of $7.8 million, or
$0.84 per basic share, including a charge for impairment of
intangible assets and goodwill of $6.4 million, for the prior year
period. Net loss, including income from discontinued operations of
$968, was $480,000, or $0.04 per basic share, for the second
quarter of 2006 compared with a net loss, including a loss from
discontinued operations of $540,000, of $8.3 million, or $0.90 per
basic share, for the quarter ended June 30, 2005. Earnings before
interest, taxes, depreciation and amortization ("EBITDA") totaled
$54,000 for the second quarter of 2006. (A reconciliation of EBITDA
to net income is provided on the attached unaudited consolidated
condensed statements of operations.) For the six months ended June
30, 2006, net operating revenues were $14.1 million compared with
$15.3 million for the same period in the prior year. Loss from
continuing operations was $285,000, or $0.02 per basic share, for
the first six months of 2006 compared with a loss from continuing
operations of $9.2 million, or $1.03 per basic share, including the
aforementioned charge for impairment of intangible assets and
goodwill, for the same period in 2005. Net income, including income
from discontinued operations of $576,000, was $291,000, or $0.03
per basic share, for the first half of 2006 compared with a net
loss, including a loss from discontinued operations of $821,000, of
$10.0 million, or $1.12 per basic share, for the first half of
2005. EBITDA totaled $116,000 for the first six months of 2006
compared with an EBITDA loss of $946,000 for the prior year period.
The live broadcast of Orion HealthCorp's second quarter conference
call will begin at 11:00 a.m. Eastern Time on August 10, 2006. An
online replay of the call will be available for 30 days following
the conclusion of the live broadcast. A link for these events can
be found on the Company's website at www.orionhealthcorp.com or at
www.earnings.com. Orion HealthCorp, Inc. provides complementary
business services to physicians through two wholly owned
subsidiaries: Integrated Physician Solutions, Inc., providing
business and management services to physician practices; and
Medical Billing Services, Inc., providing physician billing and
collection services and practice management solutions to
hospital-based physicians. The core competency of the Company is
its long-term experience and success in working with and creating
value for physicians. For more information on Orion HealthCorp,
Inc., visit the Company's website at www.orionhealthcorp.com.
Certain statements in this press release constitute
"forward-looking statements" within the meaning of the Securities
Act of 1933, as amended, and the Securities Exchange Act of 1934,
as amended (the "Acts"). Any statements contained herein that are
not statements of historical fact are deemed to be forward-looking
statements, including all statements regarding improving financial
metrics and future growth. The forward-looking statements in this
press release are based on current beliefs, estimates and
assumptions concerning the operations, future results, and
prospects of Orion HealthCorp, Inc. and the other companies
described herein. As actual operations and results may materially
differ from those assumed in forward-looking statements, there is
no assurance that forward-looking statements will prove to be
accurate. Forward-looking statements are subject to the safe
harbors created in the Acts. Any number of factors could affect
future operations and results, including without limitation,
changes in federal or state healthcare laws and regulations and
third party payer requirements, changes in costs of supplies, the
loss of major customers, labor and employee benefits, an inability
to obtain a forbearance on the Company's revolving lines of credit
as a result of the Company's default of its financial covenants,
increases in interest rates on the Company's indebtedness as well
as general market conditions, competition and pricing, and the
Company's ability to successfully implement its business
strategies, including the impact and expense of any potential
acquisitions. Orion HealthCorp, Inc. undertakes no obligation to
update publicly any forward-looking statements, whether as a result
of new information or future events. -0- *T ORION HEALTHCORP, INC.
Unaudited Consolidated Condensed Statements of Operations (in
thousands, except per share amounts) Three Months Ended Six Months
Ended June 30, June 30, ------------------ ------------------ 2006
2005 2006 2005 -------- -------- -------- -------- Net operating
revenues $6,932 $7,651 $14,086 $15,281 Operating expenses 7,287
15,349 14,788 24,318 Total other income (expenses), net (126) (110)
417 (170) -------- -------- -------- -------- Loss from continuing
operations (481) (7,808) (285) (9,207) Income (loss) from
operations of discontinued components, including gain (loss) on
disposal 1 (540) 576 (821) -------- -------- -------- -------- Net
income (loss) $(480) $(8,348) $291 $(10,028) ======== ========
======== ======== Weighted average common shares outstanding: Basic
12,591 9,246 12,510 8,958 Diluted 12,591 9,246 89,319 8,958 Net
income (loss) per share: Basic Net loss per share from continuing
operations $(0.04) $(0.84) $(0.02) $(1.03) Income (loss) per share
from discontinued operations -- (0.06) 0.05 (0.09) --------
-------- -------- -------- Net income (loss) per share $(0.04)
$(0.90) $0.03 $(1.12) ======== ======== ======== ======== Diluted
Net loss per share from continuing operations $(0.04) $(0.84) $--
$(1.03) Income (loss) per share from discontinued operations --
(0.06) 0.01 (0.09) -------- -------- -------- -------- Net income
(loss) per share $(0.04) $(0.90) $0.01 $(1.12) ======== ========
======== ======== Reconciliation of EBITDA to net income (loss):
EBITDA $54 $(491) $116 $(946) Less: Depreciation and amortization
(409) (844) (818) (1,728) Less: Charge for impairment of intangible
assets and goodwill -- (6,363) -- (6,363) Less: Total other income
(expenses), net (126) (110) 417 (169) Less: Minority interest loss
in partnership -- -- -- (1) Less: Income (loss) from operations of
discontinued components, including net gain (loss) on disposal 1
(540) 576 (821) -------- -------- -------- -------- Net income
(loss) $(480) $(8,348) $291 $(10,028) ======== ======== ========
======== ORION HEALTHCORP, INC. Consolidated Condensed Balance
Sheets (in thousands, except share amounts) June 30, Dec. 31, 2006
2005 -------- -------- (Unaudited) Current assets: Cash and cash
equivalents $329 $299 Accounts receivable, net 2,330 2,798
Inventory 170 206 Prepaid expenses and other current assets 620 716
Assets held for sale -- 976 -------- -------- Total current assets
3,449 4,995 Property and equipment, net 640 742 Other long-term
assets: Intangible assets, including goodwill, net 15,585 16,289
Other assets, net 64 92 -------- -------- Total other long-term
assets 15,649 16,381 -------- -------- Total assets $19,738 $22,118
======== ======== Current liabilities: Accounts payable and accrued
expenses $5,396 $6,738 Other current liabilities -- 25 Current
portion of capital lease obligations 92 92 Current portion of
long-term debt 3,440 4,232 Liabilities held for sale -- 452
-------- -------- Total current liabilities 8,928 11,539 --------
-------- Long-term liabilities: Capital lease obligations, net of
current portion 168 214 Long-term debt, net of current portion
3,795 3,871 Minority interest in partnership -- 35 --------
-------- Total long-term liabilities 3,963 4,120 -------- --------
Stockholders' equity: Preferred stock, par value $0.001; 20,000,000
shares authorized; no shares issued and outstanding -- -- Common
stock, Class A, par value $0.001; 70,000,000 shares authorized,
12,713,776 and 12,428,042 shares issued at June 30, 2006 and
December 31, 2005, respectively 12 12 Common stock, Class B, par
value $0.001; 25,000,000 shares authorized, 10,448,470 shares
issued and outstanding at June 30, 2006 and December 31, 2005,
respectively 11 11 Common stock, Class C, par value $0.001;
2,000,000 shares authorized, 1,437,572 shares issued and
outstanding at June 30, 2006 and December 31, 2005, respectively 2
2 Additional paid-in capital 57,025 56,928 Accumulated deficit
(50,165) (50,456) Treasury stock - at cost; 9,140 shares (38) (38)
-------- -------- Total stockholders' equity 6,847 6,459 --------
-------- Total liabilities and stockholders' equity $19,738 $22,118
======== ======== *T
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