UAHC first quarter revenues increase 20.3% to $2.1 million

Nov 22 2010

United American Healthcare Corporation (OTCQB: UAHC) today announced financial results for the Company's fiscal first quarter ended Sept. 30, 2010, which included higher revenues and improved bottom line results.  

Revenues for the first quarter were $2.1 million, an increase of 20.3% compared with revenues of $1.8 million for the first quarter of fiscal 2010.  The increase was primarily the result of the inclusion of a full quarter of contract manufacturing revenues from UAHC's acquisition of Pulse Systems, LLC, which were partially offset by a decline in medical premiums from the expiration of the Company's contract with the Centers for Medicare & Medicaid Services (CMS) to offer a Medicare Advantage -- Special Needs Plan.  

Total expenses decreased 2.5%, to $3.3 million in the fiscal 2011 first quarter, compared with total expenses of $3.4 million in the prior fiscal year's first quarter.  Expenses for the quarter were impacted by the substantial reduction in medical expenses associated with the Company's discontinued CMS Medicare business, and partially offset by increases in marketing, general and administrative expenses, and depreciation and amortization expense, as well as the inclusion of cost of goods sold for UAHC's contract manufacturing business.  For the first quarter of fiscal 2011, the Company reported a net loss of $1.4 million, or $0.15 per share, compared with a net loss of $1.6 million, or $0.19 per share, in the comparable quarter a year ago.  

"We made significant progress in the first quarter as we worked to integrate our acquisition of Pulse Systems and begin pursuing long-term growth in the dynamic medical device industry," said John M. Fife, Chairman, President and CEO of United American Healthcare.  "UAHC's first-quarter results offer our shareholders a clear view of the positive impact of Pulse Systems on our business, including top-line growth and improvements in our bottom line.  Although we are pleased with the results of our efforts, we understand that more work lies ahead, as we seek to further reduce costs while growing revenue to achieve our ultimate goal of consistent profitability."

As of Sept. 30, 2010, UAHC reported cash, cash equivalents and restricted marketable securities of $3.3 million, compared with $4.4 million as of June 30, 2010.  The decrease was primarily the result of negative operating cash flow of approximately $0.4 million in the first quarter as well as $0.3 million in payments on long-term debt and capital lease obligations.  Earnings before interest, taxes, depreciation and amortization (EBITDA) improved to ($672,000) in the first quarter of fiscal 2011 from ($1.6 million) in the prior year's first quarter.  UAHC's management and Board continued to evaluate a number of actions to reduce expenses and conserve cash, while focusing on top-line growth over the long-term.  In this effort, the Company recently announced the consolidation and relocation of its corporate headquarters, from Detroit to Chicago, which is scheduled for completion by the end of the calendar year.

"We have come through a number of events, including the economic downturn and recent proxy contest, that have posed significant challenges for our Board and management team," concluded Fife.  "By maintaining a clear focus on our strategic objectives, UAHC has emerged stronger and firmly committed to successfully integrating the Pulse acquisition and driving our future results.  We see significant opportunities for long-term growth, and our newly seated Board looks forward to putting aside the differences highlighted in the recent contest and working together to achieve this potential."

SOURCE United American Healthcare Corporation