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Exhibit 99.1
[CLAIMSNET.COM LOGO]
For more information, please contact:
Paul Miller Doris Banchik, Investor Relations
Claimsnet.com Banchik & Associates
(972) 458-1701 (805) 688-2340
[email protected] [email protected]
FOR IMMEDIATE RELEASE:
Claimsnet.com Reports Record Third Quarter 2000 Results
Revenues up 475%
Internet Transactions Up 120%
DALLAS - November 14, 2000 - Claimsnet.com inc. (NASDAQ: CLAI; BSE: CLA), a
leading provider of Internet-based business to business solutions for the
healthcare industry, today reported record financial and operating results for
the third quarter and nine months ended September 30, 2000.
For the quarter ended September 30, 2000, revenues increased 475% to a record
$483,000, as compared with $84,000 for the third quarter 1999. The increase in
revenues is attributable to a combination of sharp increases in the number of
Internet transactions processed and in the average revenue per transaction,
along with revenues from license agreements. There was a 120% increase in
Internet transactions, which reached a record 1,489,000 in third quarter 2000,
as compared with 676,000 in the same period 1999. The average revenue per
transaction in the quarter increased 138% to $0.19, versus $0.08 in the quarter
ended September 30, 1999. Revenue of $131,000 related to license agreements was
recognized during the quarter with no comparable revenue in the prior year.
Revenues were up 46% over the $330,000 reported for the second quarter 2000,
primarily attributable to the increase in transactions processed and revenue per
transaction, with no increase in revenue from license agreements.
The 475% increase in third quarter 2000 revenues was produced with only a 6%
increase in operating expenses, excluding one-time non-cash charges. Similar
leverage was realized in the cost of revenues, producing a 33% decrease in the
gross loss to $263,000 for the period. The net loss for the quarter ended
September 30, 2000, excluding a one-time non-cash charge of $1,540,000, was
$2,188,000, or $0.24 per share, versus a net loss of $2,080,000, or $0.31 per
share for the corresponding quarter in 1999. The net loss for the quarter,
including all charges, was $3,728,000, or $0.41 per share. There was a 37%
increase in basic shares outstanding between the periods, related to 1.2 million
shares issued in connection with an asset purchase during the second quarter and
the private placement of 1.37 million shares during the second and third
quarters.
For the nine months ended September 30, 2000, revenues reached $1,093,000, a
413% increase over $213,000 for the first nine months of 1999. As with the third
quarter results, this substantial increase was driven by sharp increases in the
number of transactions processed and in the average revenue per transaction,
along with revenues from license agreements. The Company processed 3,937,000
transactions in the first nine months of 2000, a 137% increase over the
1,660,000 processed in the same period 1999. The average revenue per transaction
also increased 63%, to $0.13, as compared with $0.08 in the nine months ended
September 30, 1999. The net loss for the first
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nine months of 2000 was $14,971,000, or $1.91 per share. The net loss for the
nine month period without giving effect to unusual expenses of $7,694,000 for
charges and expenses related to the April 2000 HealthExchange asset purchase,
was $6,892,000, or $0.88 per share, as compared with a net loss of $6,469,000,
or $1.17 per share in the corresponding period 1999.
In November 2000, in response to events related to the purchase of certain
assets from VHx Company, the Company reached an agreement in principal with VHx
and John Deere Health, Inc. to cancel certain agreements and cancel 400,000
shares of common stock issued to VHx. The Company also determined that there had
been an impairment of the value of assets acquired. As a result of the revised
agreement and cancellation of shares, the Company recognized a net non-cash
charge of $1,540,000 in the quarter ended September 30, 2000.
Among Claimsnet.com's most significant accomplishments in the third quarter 2000
were the co-branding partnerships with Synertech and ProxyMed, Inc. (NASDAQ:
PILL). Synertech is a premier application service provider (ASP) to an expanding
network of payers with a multi-million membership base. Synertech projects that
it will process 12 million claims, encounters and authorizations by year end for
its customers. Under the terms of this agreement, Claimsnet.com will create
co-branded claims processing Web sites for Synertech's customer (payer) base.
These Web sites will allow the payers to register their providers for
Claimsnet.com's claims processing services and to actually initiate the
processing of claims directly from the provider's practice management software.
ProxyMed, Inc. is a leading provider of eHealth physician solutions and
business-to-business healthcare transaction services. ProxyMed links more than
50,000 physician's offices to one of the industry's largest lists of payers.
Under the terms of this agreement, the two companies will provide a co-branded,
HIPAA compliant, Internet-based claims processing solution to compliment
ProxyMed's current desktop claims submission application. Both of these
co-branding efforts are expected to go live in the fourth quarter 2000.
"The results of the third quarter 2000, most clearly demonstrate both the
momentum in our business and the upside economics of our volume-sensitive
pricing", commented Bo W. Lycke, chairman and chief executive officer of
Claimsnet.com. "Our most recent co-branding partnerships are expected to begin
to contribute to our momentum as we enter our next fiscal year. These
relationships are a reflection of the increasing demand for HIPPA-compliant,
Internet-based transaction processing services by the health care industry. It
appears that the HIPPA standards may be a very important catalyst for the
industry's transition to Internet-based claims processing. We believe that the
transition will be driven by the payers, and are very excited about the
opportunity to serve that market through our well-positioned partners."
Claimsnet.com inc. is a leading provider of Internet-based, business to business
solutions for the healthcare industry, including distinctive, advanced
technology for online healthcare transaction processing. Headquartered in
Dallas, Claimsnet.com offers proprietary systems that are distinguished by ease
of use, customer care, security and measurable cost advantages. Claimsnet.com
trades on the NASDAQ Smallcap under the symbol "CLAI" and on the Boston Stock
Exchange under the symbol "CLA". More information on Claimsnet.com can be found
at www.claimsnet.com.
Safe Harbor Statement Under the Private Securities Litigation Act 1995 - With
the exception of historical information, the matters discussed in this press
release are forward looking statements that involve a number of risks and
uncertainties. The actual future results of the Company could differ
significantly from those statements. Factors that could cause or contribute to
such differences include, but are not limited to the limited operating history
of Claimsnet.com, assumptions regarding business expansion, operating
strategies, pricing trends, contract implementations, strategic business
alliances, continued access to capital, new product development, anticipated
contractual agreements, future economic, political, competitive, and market
conditions. Further information on the Company's risk factors is contained in
the Company's quarterly, annual, and other periodic reports as filed with the
Securities and Exchange Commission.
[Table and Conference Call Information to Follow]
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CLAIMSNET.COM INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- -----------------------
2000 1999 2000 1999
---------- --------- --------- ---------
<S> <C> <C> <C> <C>
REVENUES $ 483 $ 84 $ 1,093 $ 213
COST OF REVENUES 746 475 2,108 1,102
-------- --------- --------- ---------
GROSS LOSS (263) (391) (1,015) (889)
-------- --------- --------- ---------
OPERATING EXPENSES:
Research and Development 523 212 1,579 560
Purchased Research and Development
and Write-off of Purchased Intangibles 1,540 - 7,694 -
Amortization of Software and Intangibles 305 192 794 528
Selling, General & Administrative 1,098 1,420 4,012 3,620
-------- --------- --------- ---------
Total operating expenses 3,466 1,824 14,079 4,708
-------- --------- --------- ---------
LOSS FROM OPERATIONS (3,729) (2,215) (15,094) (5,597)
OTHER INCOME (EXPENSE)
Interest expense (2) - (5) -
Interest expense - bridge debt - - - (967)
Interest expense - affiliate - - - (124)
Interest income 3 135 128 219
-------- --------- --------- ---------
Total Other Income (Expense) 1 135 123 (872)
-------- --------- --------- ---------
NET LOSS $ (3,728) $ (2,080) $ (14,971) $ (6,469)
-------- --------- --------- ---------
BASIC AND DILUTED NET LOSS PER COMMON SHARE $ (0.41) $ (0.31) $ (1.91) $ (1.17)
======== ========= ========= =========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING - BASIC AND DILUTED 9,107 6,625 7,831 5,536
======== ========= ========= =========
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Third Quarter Conference Call Webcast/Replay: The Company's third quarter
analyst and investor conference call will be Webcast at 11:00 AM Eastern
Standard Time today, November 14, 2000, and available for a period of 30
days thereafter. It can be accessed through Claimsnet.com's Web site,
www.claimsnet.com, and through StreetFusion's Web site,
www.streetfusion.com.
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