Sep 7 2011
Continucare Corporation (NYSE: CNU) today reported strong financial results for its fourth quarter and fiscal year ended June 30, 2011. Financial and operational highlights for the quarter include:
“Our track record of consistent improvement in operating results continued in our fourth quarter”
- Total revenue increased 12% to $88.5 million, compared to $79.3 million in the fourth quarter of fiscal 2010;
- Income from operations was $7.6 million, compared to $9.1 million in the fourth quarter of fiscal 2010;
- Net income was $4.7 million, or $0.07 per diluted share, compared to $5.7 million, or $0.09 per diluted share, in the fourth quarter of fiscal 2010;
- In June, Continucare entered into a definitive merger agreement with Metropolitan Health Networks, Inc. whereby Metropolitan will acquire Continucare in a cash and stock transaction valued at approximately $416 million; and
- Excluding $2.4 million of expenses incurred during the quarter related to the pending merger with Metropolitan, adjusted income from operations and net income increased to $10.0 million and $6.1 million (or $0.10 per diluted share), respectively, compared to the fourth quarter of fiscal 2010.
Full Year Results
For the fiscal year ended June 30, 2011, total revenue increased 7% to $333.5 million compared to $310.8 million in the prior fiscal year. Income from operations for fiscal 2011 increased to $37.4 million compared to $36.1 million for fiscal 2010. Net income for fiscal 2011 increased to $23.9 million, or $0.38 per diluted share, compared to $22.2 million, or $0.36 per diluted share for fiscal 2010. Excluding $2.5 million of expenses incurred during fiscal 2011 related to the pending merger with Metropolitan, adjusted income from operations and net income increased to $39.9 million and $25.5 million (or $0.41 per diluted share), respectively, compared to fiscal 2010.
Balance Sheet
Continucare's cash and cash equivalents increased to $50.5 million at June 30, 2011 compared to $37.5 million at June 30, 2010, while working capital increased to $64.9 million at June 30, 2011 compared to $49.5 million at June 30, 2010. Total liabilities were $18.9 million at June 30, 2011 compared to $17.8 million at June 30, 2010. Shareholders' equity increased to $162.0 million at June 30, 2011 from $136.0 million at June 30, 2010.
"Our track record of consistent improvement in operating results continued in our fourth quarter," said Richard C. Pfenniger, Jr., Continucare's Chairman and Chief Executive Officer. "Revenues and operating income, excluding expenses related to our pending merger with Metropolitan Health Networks, exceeded the prior fiscal year's fourth quarter results, marking our 17th consecutive quarter of year-over-year improvement. In addition, our balance sheet continued to strengthen with our cash and working capital positions reaching new record levels at fiscal year-end while our balance sheet remained virtually free of long-term debt."
Definitive Merger Agreement with Metropolitan Health Networks, Inc.
On June 27, 2011, Continucare announced that it entered into a definitive merger agreement providing for the merger of Continucare with and into a wholly-owned subsidiary of Metropolitan Health Networks, Inc. (NYSE Amex: MDF) in a cash and stock transaction valued at approximately $416 million at the time of the announcement. Under the terms of the merger agreement, each holder of an outstanding share of Continucare common stock will receive $6.25 per share in cash, and 0.0414 of a share of Metropolitan common stock, which, based upon the share price at the time of announcement, is equal to approximately $0.20. The exact value of the consideration per share will depend on Metropolitan's share price at closing. The merger is subject to the satisfaction of the closing conditions contained in the merger agreement. Continucare's shareholders approved the proposed merger at a Special Meeting of Shareholders on August 22, 2011. Continucare currently expects to complete the merger on or about the end of September 2011.
Source: Continucare Corporation