Hythiam, Inc. (NASDAQ:HYTM) today announced financial results for the second quarter ended June 30, 2009, which include the consolidated results from Comprehensive Care Corporation (CompCare) through January 20, 2009, the disposition date. As a result of the January 20, 2009 sale, the Company’s results treat CompCare as a Discontinued Operation.
"We continue to work toward securing final agreements with health plans and other third-party payors, and are looking forward to launching Catasys™ with customers,” said Rick Anderson, Hythiam’s President and COO. “The contracting process has taken longer than anticipated, but we are expending significant effort to address complexities and complete final agreements. In addition, we have continued to expand our sales pipeline as prospective customers are recognizing the cost impact of substance dependence on their populations. We continue to refine our product offering and are prepared for anticipated implementations. Based on the current level of interest in Catasys and given the overall market conditions and pressures, we expect additional adoption of Catasys in the coming quarters,” Anderson concluded.
The company reported a consolidated net loss of $4.9 million, or $0.09 per share for the second quarter of 2009. This compares with a 2008 second quarter consolidated net loss of $14.1 million, or $0.26 per share, which includes a $3.9 million net loss from discontinued operations, or $0.07 per share. The consolidated net loss for the six months ended June 30, 2009 amounted to $1.9 million, or $0.03 per share, which includes $10.4 million of income from discontinued operations, or $0.19 per share.
For the 2009 second quarter, the Company reported revenues of $371,000 from its continuing operations (healthcare services business), compared to revenues from continuing operations of $2.0 million during the comparable period last year. The decrease in healthcare services revenues was primarily attributable to the difficult economy and the Company's decision to streamline operations by reducing operating costs and resources supporting private-pay to focus on managed care opportunities. There were a total of 49 patients treated with the PROMETA® Treatment Program in the second quarter of 2009, compared to 246 patients treated in the second quarter of 2008. During the second quarter of 2009, there were 17 licensee sites contributing to revenues, versus 31 in the same period last year.
Loss from continuing operations for the 2009 second quarter was $4.9 million, or $0.09 per share, versus a loss of $10.2 million, or $0.19 per share, in the second quarter of 2008. Included in the 2009 second quarter loss were consolidated non-cash charges for depreciation, amortization and stock-based compensation expense of $1.6 million, compared to $2.5 million in non-cash charges in the same period in 2008. The loss for the 2009 second quarter also included a $28,000 “other-than-temporary” loss on auction-rate securities and a non-cash gain of $15,000 from the change in fair value of the Company's warrant liabilities. The loss from continuing operations for the 2008 second quarter also included a non-cash charge of $1.3 million from the change in fair value of the Company's warrant liability.
For the six months ended June 30, 2009, revenues for continuing operations were $1.1 million, compared to revenues of $4.0 million in the same period in 2008. The decrease in healthcare services revenues was primarily attributable to the difficult economy and the Company's decision to streamline operations by reducing operating costs and resources supporting private-pay to focus on managed care opportunities. Net loss from continuing operations for six months ended June 30, 2009 was $12.3 million, or $0.22 per share, compared to a net loss of $19.2 million, or $0.36 per share, for the six months ended June 30, 2008. The net loss for the six months ended June 30, 2009 included non-cash charges for depreciation, amortization and stock-based compensation expenses of $3.2 million, compared to $5.5 million for similar expenses in the same period in 2008. The net loss for the six months ended June 30, 2009 also included impairment charges of $1.1 million related to property, equipment and intangible assets and $160,000 related to “other-than-temporary” losses on auction rate securities, a $276,000 loss on extinguishment of debt and a non-cash gain of $84,000 from the change in fair value of the Company's warrant liabilities, compared to a non-cash gain of $955,000 from the change in fair value of the Company's warrant liabilities for the same period in 2008.
As of June 30, 2009, the Company had consolidated cash, cash equivalents, and marketable securities of approximately $3.0 million, excluding auction rate securities of $10.4 million.
In an effort to continue enhancing the Company’s ability to fund ongoing operations, management further reduced yearly operating expenses by an additional $4.5 million in the first and second quarters of 2009. The Company will continue to monitor and reduce expenses as necessary, and is focused on signing new agreements with health plans for its Catasys offering.
About the PROMETA® Treatment Program
Hythiam's PROMETA Treatment Program is designed for use by health care providers seeking to treat individuals diagnosed with dependencies to alcohol, cocaine or methamphetamine, as well as combinations of these drugs. The PROMETA Treatment Program includes nutritional supplements, FDA-approved oral and IV medications used off-label and separately administered in a unique dosing algorithm, as well as psychosocial or other recovery-oriented therapy chosen by the patient and his or her treatment provider. As a result, PROMETA represents an innovative approach to managing alcohol, cocaine, or methamphetamine dependence that is designed to address physiological, nutritional, and psychosocial aspects of the disease, and is thereby intended to offer patients an opportunity to achieve sustained recovery. To learn more, please visit www.prometainfo.com.
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