TIDMAHI
RNS Number : 8164W
Allied Healthcare International Inc
04 August 2009
Revenues Increase 7.3%, at Constant Exchange Rates
NEW YORK, NY--(Marketwire - August 04, 2009) - Allied Healthcare International
Inc. (NASDAQ: AHCI) (AIM: AHI)
Allied Healthcare International Inc. (NASDAQ: AHCI) (AIM: AHI)
(http://www.alliedhealthcare.com), a leading provider of flexible healthcare
staffing services in the United Kingdom, has issued financial results for its
fiscal 2009 third quarter.
To provide investors with an increased understanding of the Company's business,
as in previous quarters, Allied is providing a breakdown of its revenues, gross
profits, selling, general and administrative costs and operating income at
constant exchange rates using the comparable prior period weighted average
exchange rate. In addition, as the Company's revenues and gross profits are
generated in the United Kingdom, an analysis is included, within the management
discussion below, of the last seven quarters' revenues and gross profits in
pounds sterling to enable investors to fully understand the underlying trends
over these periods without the effects of currency exchange rates. As noted in
the reported numbers, recent fluctuations in foreign exchange rates have
significantly impacted the Company's current period results.
Fiscal Third Quarter Results:
For the third quarter of fiscal 2009, at constant exchange rates, revenues
increased by $5.5 million, or 7.3%, to $80.5 million, compared with $75.0
million reported during the same period in fiscal 2008. Contributing to the
increase in revenues was Allied's Homecare revenues, which grew by 17.3% to
$67.5 million. Nursing Home revenues declined by 25.3% to $7.3 million. Hospital
revenues decreased by 26.0% to $5.7 million. After the unfavorable impact of
currency exchange of $17.4 million, revenues decreased to $63.1 million.
At constant exchange rates, total gross profit for the third fiscal quarter
increased 5.8% to $24.5 million, compared with $23.1 million reported for the
comparable quarter in fiscal 2008. Gross profit margin for the third quarter was
30.4%, as compared to 30.8% for the comparable prior period. Foreign exchange
decreased gross profit by $5.3 million to $19.2 million for the quarter.
At constant exchange rates, SG&A for the third fiscal quarter was $20.5 million,
compared with $19.4 million reported last year. As a percent of revenues, SG&A
costs were 25.8%, compared to 25.9% in the comparable prior year period. Foreign
exchange decreased costs by $4.2 million to $16.3 million for the quarter.
At constant exchange rates, operating income for the third quarter of fiscal
2009 increased to $4.0 million, compared to operating income of $3.7 million
reported during the 2008 third fiscal quarter. Foreign exchange decreased
operating income by $1.1 million to $2.9 million for the quarter.
Net income for the third quarter of fiscal 2009 was $2.4 million, as compared
with $2.5 million reported during the 2008 third fiscal quarter. Diluted
earnings per share was $0.05 for the quarter, compared to diluted earnings per
share of $0.05 last year.
Fiscal Nine-Month Results:
For the fiscal nine months ended June 30, 2009, at constant exchange rates,
revenues increased by $12.8 million, or 5.7%, to $236.4 million, compared with
$223.6 million reported during the same period in fiscal 2008. Contributing to
the increase in revenues was Allied's Homecare revenues, which grew by 13.8% to
$191.2 million. Nursing Home revenues declined by 21.1% to $25.3 million.
Hospital revenues decreased by 15.2% to $19.9 million. After the unfavorable
impact of currency exchange of $56.4 million, revenues decreased to $180.0
million.
At constant exchange rates, total gross profit for the fiscal nine months ended
June 30, 2009, increased 7.4% to $72.5 million, compared with $67.5 million
reported for the comparable period in fiscal 2008. Gross profit margin for the
fiscal nine months ended June 30, 2009, increased to 30.6% from 30.2% for the
comparable prior period. Foreign exchange decreased gross profit by $17.3
million to $55.2 million for the quarter.
At constant exchange rates, SG&A for the fiscal nine months ended June 30, 2009,
was $60.0 million, compared with $59.1 million reported last year, an increase
of 1.5%. As a percent of revenues, SG&A costs were 25.7% compared to 26.4% in
the comparable prior year period. Foreign exchange decreased costs by $13.8
million to $46.2 million for the quarter.
At constant exchange rates, operating income for the fiscal nine months ended
June 30, 2009, increased to $12.5 million, compared to operating income of $8.4
million reported during the 2008 nine months ended June 30, an increase of 48.6%
over the prior year. Foreign exchange decreased operating income by $3.5 million
to $8.9 million for the nine-month period.
Income from continuing operations for the nine months ended June 30, 2009,
increased to $7.0 million, as compared with $5.9 million reported during the
2008 fiscal nine-month period. Diluted earnings per share from continuing
operations was $0.15 for the nine month period ended June 30, 2009, compared to
diluted earnings per share from continuing operations of $0.13 last year.
Net income for the nine months ended June 30, 2009, increased to $7.4 million,
as compared with $5.9 million reported during the 2008 fiscal nine-month period.
Diluted earnings per share was $0.16 for the nine-month period, which includes
$0.01 from discontinued operations due to the release of reserves as a result of
the warranty period within the sales agreement, related to the sale of the
respiratory business in fiscal 2007, having expired. This compares to $0.13 for
the same prior year period.
At June 30, 2009, and September 30, 2008, Allied's cash balance was $33.7
million (GBP20.4 million) and $26.2 million (GBP14.4 million), respectively,
representing an underlying increase in the cash balance of GBP6.0 million.
For the fiscal nine months ended June 30, 2009, depreciation and amortization
was $2.8 million (GBP1.8 million) and capital expenditures were $2.2 million
(GBP1.4 million). Days Sales Outstanding was twenty-four days at June 30, 2009
(46 days including unbilled account receivables), and twenty-five days at June
30, 2008 (44 days including unbilled account receivables).
Management Discussion:
"We continue to see good growth in our homecare business, which now represents
almost 84% of our business," commented Sandy Young, Chief Executive Officer of
Allied. "The revenue growth in the quarter of 17.3% was particularly pleasing
and was ahead of the 10-15% growth range that we have recently been operating
within. Our Continuing Care continues to grow strongly and accounts for over 15%
of the revenues of this business. Continuing Care has benefitted from the
restructuring we carried out earlier this year. We have low penetration in this
market and our proposition of providing homecare with a lower level medical
requirement via support staff under nurse supervision is popular with hospital
trusts."
Mr. Young continued: "Our nursing homes and hospital staffing business results
continue to struggle but following our acceptance onto the new PASA framework
agreements, which come into effect in October 2009, we are hopeful that the
higher charges under this revised contract will give us opportunities going
forward. The higher charges are necessary to enable us to effectively recruit
staff to service this business. We currently have plans in the next financial
year to re-launch this service line in a few of our regional offices as well as
our existing London operation.
"While current period SG&A running costs of 25.8% of revenues are lower than the
prior year period, we are continuing to invest in certain areas of our business
that includes such items as continuing care, learning disability, IT systems,
and business improvement projects to ensure that we support future growth in
revenues. At the same time, we maintain tight controls over other areas of SG&A
costs so as to maintain our objective of reducing SG&A costs as a percent of
revenues.
"We currently have several business improvement initiatives under way with
project management support. These projects cover winning new business, carer
retention, bid implementation, and branch operations. There are also other
projects supporting service delivery. We believe that being a high quality
service provider is a key driver to increased revenue and profit growth.
"The third quarter also concluded the successful pilot phase of our Coldharbour
IT replacement. We now have thirteen branches successfully running on
Coldharbour. The cost of the project is within the original budget and time
projections with a total capital expenditure of $2.4 million and operating
expense of $4.5 million. To date, expenditures have been $2.7 million split
between $2.2 million capital and $0.5 million operating expense. The project
will allow us to make further efficiencies in the way we process transactions
and will also improve service delivery."
Mr. Young concluded: "As noted in our previous quarter's press release, with
nearly all our operations in the United Kingdom, we believe it is important for
investors to see the underlying revenues and gross profits in pound currency as
detailed below. This shows growth in our gross margins year to date of 7.4% and
our third quarter gross margin of 30.4% is well within our expectations. Our
SG&A costs year to date, excluding exchange effects, increased by 1.5%, compared
to the prior year despite the increase in revenues that we have generated."
Dr. Jeffrey Peris, Non-Executive Chairman of the Board of Allied, commented:
"Sandy Young and the management team have achieved operating income for the
first three quarters of $12.5 million, excluding exchange, which compares to
$8.4 million for the same prior year's quarters. This is an increase of 48.6%,
and reflects the continued improvements the Company is making across its
business to help it affirm its position as one of the leaders in the U.K.
homecare market place. We are pleased with the results of the third quarter and
that the successes of previous quarters have enabled Allied to be included in
the Russell 3,000 Index, thereby providing us with opportunities to reach
additional investors."
Conference Call Information -- August 4, 2009 at 10:00AM EST / 3:00PM GMT:
Allied invites all those interested in listening to management's discussion of
the results to join the call by dialing 877-407-0778 for domestic participants,
and 201-689-8565 for international participants today, August 4, 2009, at
10:00AM EST / 3:00PM GMT. Participants may also access a live webcast of the
conference call through the "Investors" section of Allied Healthcare's Website:
www.alliedhealthcare.com. A replay will be available for one week following the
call by dialing 877-660-6853 for domestic participants, and 201-612-7415 for
international participants. When prompted, please enter account number 286 and
conference ID number 321299. The presentation will be available and archived on
the Company's website for ninety days.
In addition to disclosing results of operations that are determined in
accordance with generally accepted accounting principles ("GAAP"), this press
release also discloses non-GAAP results of operations that exclude or include
certain charges. These non-GAAP measures adjust for foreign exchange effects.
Management believes that the presentation of these non-GAAP measures provides
useful information to investors regarding the Company's results of operations,
as these non-GAAP measures allow investors to better evaluate ongoing business
performance. Investors should consider non-GAAP measures in addition to, and not
as a substitute for, financial measures prepared in accordance with GAAP. A
reconciliation of the non-GAAP measures disclosed in this press release with the
most comparable GAAP measures are included in the financial tables included in
this press release.
For more news and information on Allied Healthcare International Inc., please
visit http://www.IRGnews.com/coi/AHCI where you can find the CEO's video, a fact
sheet on the company, investor presentations, and more.
ABOUT ALLIED HEALTHCARE INTERNATIONAL INC.
Allied Healthcare International Inc. (http://www.alliedhealthcare.com) is a
leading provider of flexible healthcare staffing services in the United Kingdom.
Allied operates a community-based network of approximately one hundred ten
branches with the capacity to provide carers (known as home health aides in the
U.S.), nurses, and specialized medical personnel to locations covering
approximately 90% of the U.K. population. Allied meets the needs of private
patients, community care, nursing and care homes, and hospitals.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this news release may be forward-looking
statements. These forward-looking statements are based on current expectations
and projections about future events. Actual results could differ materially from
those discussed in, or implied by, these forward-looking statements. Factors
that could cause actual results to differ from those implied by the
forward-looking statements include: general economic and market conditions;
Allied's ability to continue to recruit and retain flexible healthcare staff;
Allied's ability to enter into contracts with local government social services
departments, NHS Trusts, hospitals and other healthcare facility clients on
terms attractive to Allied; the general level of patient occupancy at our
clients' hospitals and healthcare facilities; dependence on the proper
functioning of Allied's information systems; the effect of existing or future
government regulation of the healthcare industry, and Allied's ability to comply
with these regulations; the impact of medical malpractice and other claims
asserted against Allied; the effect of regulatory change that may apply to
Allied and that may increase costs and reduce revenues and profitability;
Allied's ability to use net operating loss carry forwards to offset net income;
the effect that fluctuations in foreign currency exchange rates may have on our
dollar-denominated results of operations; and the impairment of goodwill, of
which Allied has a substantial amount on the balance sheet, may have the effect
of decreasing earnings or increasing losses. Other factors that could cause
actual results to differ from those implied by the forward-looking statements in
this press release include those described in Allied's most recently filed SEC
documents, such as its most recent annual report on Form 10-K, all quarterly
reports on Form 10-Q and any current reports on Form 8-K filed since the date of
the last Form 10-K. Allied undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events, or otherwise.
Contacts:
Allied Healthcare International Inc.
Sandy Young
Chief Executive Officer
Paul Weston
Chief Financial Officer
UK 00-44-1785 810-600
sandyyoung@alliedhealthcare.com
paulweston@alliedhealthcare.com
or
The Investor Relations Group
Adam Holdsworth
212-825-3210
or
Cenkos Securities plc (Nominated Advisor)
Elizabeth Bowman
London: 00-44-20-7397-8928
or
Ian Soanes
London: 00-44-20-7397-8924
This information is provided by RNS
The company news service from the London Stock Exchange
END
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