LCA-Vision Inc. (Nasdaq: LCAV), a leading provider of laser vision correction services under the LasikPlus® brand, today announced financial and operating results for the three and nine months ended September 30, 2009.
Third Quarter 2009 Operational and Financial Results (all comparisons are with the third quarter of 2008)
- Revenue was $27.6 million compared with $37.4 million; adjusted revenue was $25.7 million compared with $33.0 million.
- Procedure volume was 15,335 compared with 21,484.
- Same-store revenue (70 vision centers) decreased 24.9%; adjusted same-store revenue decreased 20.6%.
- Operating loss was $10.4 million compared with $6.2 million; adjusted operating loss was $12.1 million compared with $10.1 million. Operating loss and adjusted operating loss in the third quarter of 2009 included $4.4 million in impairment charges; the third quarter of 2008 included $0.8 million in restructuring charges.
- Income tax expense was $10.3 million, which reflected the previously announced establishment of a full valuation allowance on net deferred tax assets, compared with an income tax benefit of $2.0 million.
- Net loss was $19.9 million, or $1.07 per share, compared with net loss of $4.7 million, or $0.25 per share.
- Cash and investments totaled $62.1 million as of September 30, 2009, up $2.6 million from December 31, 2008.
Year-to-date 2009 Operational and Financial Results (all comparisons are with the first nine months of 2008)
- Revenue was $107.2 million compared with $171.1 million; adjusted revenue was $100.0 million compared with $156.2 million.
- Procedure volume was 61,058 compared with 95,729.
- Operating loss was $26.4 million compared with operating income of $1.4 million; adjusted operating loss was $32.9 million compared with adjusted operating loss of $12.1 million. Operating loss and adjusted operating loss included $6.9 million in restructuring and impairment charges and $0.8 million in consent revocation solicitation charges in 2009; operating income and adjusted operating loss in the first nine months of 2008 included restructuring charges of $1.3 million.
- Net cash provided by operations was $7.8 million compared with $9.3 million.
- Net loss was $29.6 million, or $1.59 per share, compared with net income of $1.6 million, or $0.09 per diluted share.
Since the first quarter of 2007, LCA-Vision has provided both adjusted revenue and operating income (loss) as a means of measuring performance that adjusts for the non-cash impact of accounting for separately priced extended warranties. A reconciliation of revenue and operating income (loss) as reported in accordance with U.S. Generally Accepted Accounting Principles (GAAP) is provided at the end of this news release. Management believes the adjusted information better reflects operating performance and, therefore, is more meaningful to investors.
"As an organization, we are focused on maximizing our business results in the current challenging environment while building a foundation for growth and profitability when the economy improves. Our priorities include cash conservation, patient acquisition and retention, and organizational effectiveness," said LCA-Vision's Chief Financial Officer Michael J. Celebrezze. "We are taking multiple actions that involve every aspect of our operations. To expedite needed change, we expanded our leadership advisory committee that now includes three LasikPlus(®) surgeons to provide more immediate medical input on our strategic decisions.
"During the third quarter, we implemented programs that improved financial performance in 28 targeted LasikPlus(®) vision centers, resulting in approximately $900,000 in monthly profit improvements," stated Celebrezze. "However, in order to further conserve cash, we will be closing 10 underperforming vision centers and reducing our workforce by 15%, both by year end. These 70 positions include reductions from the closing of 10 vision centers, as well as reductions in our call center and corporate and regional offices. We expect these actions to reduce annual expenses by more than $4 million annually. During the fourth quarter of 2009, we anticipate recording restructuring charges of approximately $4.1 million related to these closures and staff reductions. We will consider the closure of additional underperforming vision centers in the future as we continue to take aggressive actions to conserve cash."
Chief Operating Officer David L. Thomas commented, "We improved marketing efficiency to $359 per procedure during the third quarter, while evaluating a host of initiatives to support procedure volume. Among these, we conducted consumer research to identify factors driving customer choice and we have developed and are testing new television advertisements. We also have underway a new 'See Now; Pay Later' promotion that tested well with focus groups. We are reaching new prospects through innovative programs such as our Delta Airlines SkyMiles and Life Time Fitness partnerships that provide their members with options such as frequent flyer miles or reduced out-of-pocket procedure costs. Additionally, we plan in the coming weeks to unveil an upgraded LasikPlus(®) website with enhanced features including easier online appointment scheduling.