Mar 11 2011
Hooper Holmes (NYSE Amex:HH) today announced financial results for the fourth quarter and year ended December 31, 2010.
“I am pleased to report net income of $2.2 million, or $0.03 per diluted share, for the 2010 fourth quarter, despite a 4% decline in revenue vs. the 2009 fourth quarter”
Consolidated revenues totaled $43.4 million for the fourth quarter of 2010, representing a 4% revenue decline from $45.0 million in the fourth quarter of 2009. The Company recorded net income of $2.2 million for the fourth quarter of 2010, or $0.03 per diluted share, compared to net income of $3.0 million, or $0.04 per diluted share, in the fourth quarter of 2009. The fourth quarter of 2009 included a federal tax benefit of $1.5 million pertaining to the utilization of fully reserved net operating losses, pursuant to the Business Assistance Act signed into law in the fourth quarter of 2009.
For the year ended December 31, 2010, consolidated revenues were $166.4 million, a decline of 9% compared to revenue of $182.4 million in 2009. The Company's net income for 2010 totaled $1.5 million, or $0.02 per diluted share, compared to approximately breakeven, or $0.00 per diluted share, in 2009. The results for 2010 include a $1.6 million reduction in a previously established reserve for interest and penalties pertaining to unclaimed property. In addition, the results for 2010 and 2009 include a non-cash charge of $0.6 million and $2.7 million, respectively, attributable to increased depreciation expense resulting from a reduction in the estimated useful life of the Company's current IT system. The 2010 and 2009 results also include restructuring and other charges totaling $1.0 million and $1.2 million, respectively.
Fourth quarter 2010 revenues by service line:
- Portamedic revenue declined 10% to $29.2 million in the fourth quarter of 2010 compared to $32.3 million in the fourth quarter of 2009, primarily due to an 8% decline in paramedical exams completed during the quarter, along with a 2.6% decrease in revenue per exam.
- Heritage Labs revenue totaled $3.1 million for the fourth quarter of 2010, an increase of 3% compared to the fourth quarter of 2009, primarily attributable to an increase in revenue per specimen tested.
- Hooper Holmes Services revenue totaled $5.3 million for the fourth quarter of 2010, a 5% decline from $5.5 million in the fourth quarter of 2009, primarily attributable to reduced demand for tele-interviewing services.
- Health & Wellness revenue totaled $5.8 million for the fourth quarter of 2010, a 41% increase from revenue in the fourth quarter of 2009, primarily attributable to a 29% increase in screenings.
Net cash provided by operations approximated $4.6 million in the fourth quarter of 2010. Capital expenditures totaled $1.4 million in the fourth quarter. For the year ended December 31, 2010, net cash provided by operations totaled $9.4 million, with capital expenditures approximating $4.3 million for 2010. As of December 31, 2010, cash and cash equivalents totaled $21.4 million, with no outstanding borrowings under the Company's credit facility.
"I am pleased to report net income of $2.2 million, or $0.03 per diluted share, for the 2010 fourth quarter, despite a 4% decline in revenue vs. the 2009 fourth quarter," said Ransom J. Parker, President and CEO of Hooper Holmes. "In addition, 2010 was a strong cash generating year as we increased our cash position by nearly 30%. While the fourth quarter demonstrated a step in the right direction, we have a lot of work ahead of us. For 2011, we will be making targeted investments in initiatives to improve our infrastructure, including plans to strengthen our sales and marketing teams, IT programs, and quality of service. We are optimistic that these initiatives will build the correct foundation for revenue growth and profitability in 2012."
Larry Ferguson, Chairman of the Board of Hooper Holmes, commented: "We achieved a 5% net margin in the fourth quarter, despite the revenue decline. However, for the Company to succeed for the long term and create sustained shareholder value we need to stop the decline in revenues. The Board is confident that the turnaround strategies management has outlined will be successful, but it is going to take hard work, time and management focus for these initiatives to take hold."
SOURCE Hooper Holmes