Healthways (HWAY) reported first-quarter fiscal 2011 earnings per share of 12 cents, largely missing the Zacks Consensus Estimate of 20 cents and also falling short of the year-ago earnings of 27 cents. Net income more than halved year over year to $4.14 million.
Revenues
Revenues came in at $163 million in the first quarter, down 8.9% year over year, missing the Zacks Consensus Estimate of $168 million.
Margins
Healthways’ operating income dropped sharply 44.2% year over year to $10.8 million in the reported quarter. Operating margin shrank to 6.6% from 10.8% in the year-ago quarter.
Balance Sheet and Cash Flow
The company had cash and cash equivalents of only $4.3 million as of March 31, 2011, down a substantial 96.3% year over year. Long-term debt stood at $239.6 million, lower 14.1% year over year.
Other
During the reported quarter, Healthways inked 32 new, expanded or extended contracts. The company experienced a 33% year over year growth in Requests for Proposals (“RFP”) and generated several possible leads on a non-RFP basis.
On April 25, 2011, Healthways announced an expansion of its ties with CareFirst BlueCross BlueShield with whom it would form a partnership to deliver their network-wide Primary Care Medical Home model. The program is supposed to be the largest in its category in the nation.
Healthways had earlier sealed deals with the Hawaii Medical Service Association, the Government of New South Wales in Australia and a public body under the supervision of the French Ministry of Health, which insures more than 85% of the French population.
Outlook
Healthways has affirmed its revenue guidance for 2011 between $672 million and $710 million. It assumes revenues from domestic operations of about $650 million to $680 million. International sales are expected in the range of $22 million to $30 million.
The company also reiterated fiscal 2011 adjusted earnings guidance of 90 cents to $1.08 per share. It forecasts net income of 94 cents to $1.04 a share from domestic operations and a loss of 4 cents to an income of 4 cents a share from international ventures.
Healthways is a prominent vendor of specialized and composite solutions, enabling recipients to maintain or improve their wellbeing and, consequently, reduce systemic healthcare costs. The company’s solutions are intended to keep people healthy and mitigate lifestyle risk factors that can cause disease and optimize care for those with chronic illness. Healthways competes, in niches, with Express Scripts (ESRX) among others.
EXPRESS SCRIPTS (ESRX): Free Stock Analysis Report
Be the first to comment