Hooper Holmes (NYSE Amex:HH) today announced financial results for the second quarter ended June 30, 2010.
“Three of our divisions were profitable as we worked hard to control costs, even with a slowdown in insurance exams due to the economy”
Consolidated revenues totaled $40.7 million for the second quarter of 2010, representing a 12% revenue decline from the $46.2 million in the second quarter of 2009. The Company recorded net income of $1.2 million for the second quarter of 2010, or $0.02 per share, compared to a net loss of $0.5 million, or a loss of ($0.01) per share for the second quarter of 2009. Net income for the second quarter of 2010 includes a $1.6 million reduction in a previously established reserve for interest and penalties pertaining to unclaimed property. In addition, net income for the second quarter 2010 includes non-cash charges of $0.2 million attributable to accelerated depreciation expense resulting from a reduction in the estimated useful life of the Company's current IT system, along with $0.1 million of restructuring charges. The net loss for the second quarter 2009 included $0.8 million attributable to accelerated depreciation expense and $0.7 million of restructuring and other charges.
Second quarter 2010 revenues by service line:
- Portamedic revenue declined 13% to $30.1 million in the second quarter of 2010 compared to $34.6 million in the second quarter of 2009, primarily due to a 15% decline in paramedical exams completed during the quarter, partially offset by a 0.4% increase in revenue per exam.
- Heritage Labs revenue totaled $2.8 million for the second quarter of 2010, a decrease of 10% compared to the second quarter of 2009, primarily attributable to reduced demand for lab testing services and specimen collection kits.
- Hooper Holmes Services revenue totaled $5.5 million for the second quarter of 2010, a 15% decline from $6.5 million in the second quarter of 2009, primarily due to reduced demand for the Company's medical records collection services.
- Health & Wellness revenue totaled $2.3 million for the second quarter of 2010, an 18% increase from revenue in the comparable second quarter of 2009.
Net cash provided by operations approximated $2.8 million in the second quarter of 2010. Capital expenditures totaled $1.1 million in the second quarter. As of June 30, 2010, cash and cash equivalents totaled $19.5 million, with no borrowings under the Company's credit facility.
"Three of our divisions were profitable as we worked hard to control costs, even with a slowdown in insurance exams due to the economy," said Roy H. Bubbs, President and CEO of Hooper Holmes. "In our remaining Services division, we are taking actions to eliminate unacceptable losses and we expect to achieve sustained profitability in this division by December 2010. I am pleased with the strong growth in our Health and Wellness division compared to the prior year, and with the favorable customer response to our new iParamed platform, which should lead to increased profits consistent with our 5% profitability goal."
Larry Ferguson, Chairman of the Board of Hooper Holmes, commented "Management and the Board continue to pursue short-term operational improvements and broader strategic initiatives. Efforts are still underway to drive us toward our goal of 5% profitability and we are cautiously optimistic we will achieve this goal in the fourth quarter."