HMS fourth quarter revenue increases 14.3% to $99.7 million

HMS Holdings Corp. (NASDAQ: HMSY) today announced financial results for its fourth quarter and full year ended December 31, 2011.

Revenue for the fourth quarter of 2011 increased 14.3% to $99.7 million, compared with $87.2 million for the same period a year ago. Net income decreased 9.9% to $11.1 million or $0.13 per diluted common share for the fourth quarter of 2011, compared to net income of $12.4 million or $0.14 per diluted common share during the fourth quarter of the prior year. After adjusting for revenue and expenses related to the December 16, 2011 acquisition of HealthDataInsights ("HDI"), net income for the quarter increased 26.2% from the prior year to $15.6 million and earnings per diluted common share increased 28.6% from the prior year to $0.18 per diluted common share.

For the full year 2011, the Company reported revenue of $363.8 million, a 20.1% increase over 2010 revenue of $302.9 million. Also for the full year, the Company reported net income increased 19.2% to $47.8 million or $0.55 per diluted common share, versus net income of $40.1 million or $0.47 per diluted common share in the prior year. After adjusting for revenue and expenses related to the acquisition of HDI, net income for 2011 increased 30.3% from the prior year to $52.2 million and earnings per diluted common share increased 27.7% from the prior year to $0.60 per diluted common share.

"We made tremendous progress in 2011 on our multi-year plan to diversify our market and product portfolio and create a platform for continued growth," said Bill Lucia, Chief Executive Officer of HMS. We established ourselves as the Medicaid RAC market leader, securing 17 contracts for RAC and RAC-like services. Despite slower than anticipated implementation by CMS and by the states of the Medicaid RAC program nationally, we are well positioned to meet our revenue growth targets from this sector over the long term."

Lucia continued, "In addition, with the purchase of HDI we completed what we believe will be a transformational acquisition. HDI accelerates our entry into the commercial market and establishes a major presence in the Medicare space."