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[LANDACORP LOGO]
EXHIBIT 20.2
News for Immediate Release
For more information contact: Steve Kay
Landacorp, Inc.
530-891-0853
[email protected]
LANDACORP POSTS RECORD REVENUE FOR THIRD CONSECUTIVE QUARTER
ATLANTA, GA. (November 2, 2000) -- Landacorp, Inc. (NASDAQ: LCOR), a leading
provider of Internet- and Windows(R)-based medical management solutions to
health plan and healthcare delivery organizations, today reported record results
for the third quarter ended September 30, 2000.
Total revenues for the third quarter of 2000 increased 64% to $4.0 million from
revenues of $2.4 million in the corresponding period of 1999. The Company
reported a net loss of $530,000, or $0.04 per share, in the third quarter of
2000, compared with a net loss of $548,000, or $0.42 per share in the
corresponding period of 1999. Excluding stock-based compensation and goodwill,
the Company reported a net loss of $66,000, less than $0.01 per share in the
third quarter of 2000. (NOTE: THE CONSENSUS ESTIMATE OF A NET LOSS OF $0.05 PER
SHARE EXCLUDES THE STOCK-BASED COMPENSATION AND GOODWILL, AND SHOULD BE COMPARED
WITH THE REPORTED NET LOSS OF $0.005 PER SHARE.) This compares with a net loss
of $34,000, or $0.03 per share, in the corresponding period of 1999.
Total revenues for the first three quarters of 2000 increased 36% to $9.6
million from revenues of $7.1 million in the corresponding period of 1999. The
Company reported a net loss of $3.7 million, or $0.33 per share, in the first
three quarters of 2000, compared with a net loss of $1.5 million, or $1.21 per
share, in the corresponding period of 1999. Excluding stock-based compensation,
goodwill and a one-time IPO-related bonus payment, the Company reported a net
loss of $1.7 million, or $0.15 per share, in the first three quarters of 2000.
This compares with a net profit of $60,000 or $0.05 per share, in the
corresponding period of 1999.
A BOLD STEP FORWARD
"I am again pleased to report that we have beaten our planned results, as well
as equaled analysts' revenue targets," said Landacorp President and CEO, Gene
Cattarina. "Our net loss for the quarter was less than published projections.
Additionally, I can report that our cash burn for the quarter was just slightly
over $700,000. This is well short of our planned $1.5 million burn rate per
quarter that we had anticipated for this year. Overall, it's a positive
performance that has kept us ahead of our plan year to date.
"Clearly, I think our big news is the bold step we have taken with of our
acquisitions of ProMedex and PatientCentrix, which we announced earlier today,"
said Mr. Cattarina. "These acquisitions have clearly positioned us among the
industry's most comprehensive end-to-end medical
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LANDACORP POSTS RECORD THIRD-QUARTER RESULTS
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NOVEMBER 2, 2000
management services. And, in doing so, opened up significant opportunities in
population health management, which include disease management, predictive
modeling and preventive intervention. These capabilities are a natural fit with
our core Landacorp software applications. The combined expertise of the three
organizations will enable us to package a range of population health management
services that will allow our payer clients to work cost effectively with
chronically ill patients as well as target patients at risk. As Al Lewis,
Executive Director of the Disease Management Consortium, stated in today's
announcement, this is a compelling revenue opportunity.
"I believe the population health management arena is key to our future growth
strategy and we will be working diligently to integrate and position ourselves
with these two acquisitions as we move forward into next year. Of even greater
importance to our shareholders, is my belief that we have taken an important
step forward in realizing the strategies that drove our IPO last February,"
Mr. Cattarina concluded.
FURTHER DETAILS OF THE PREVIOUSLY ANNOUNCED PROMEDEX AND PATIENTCENTRIX
ACQUISITIONS
Terms of the acquisition of ProMedex, which was closed October 27,
2000, include cash at the closing of approximately $585,000, together with
250,000 shares that will be issued on Friday, November 3, 2000. The deal also
includes issuing new incentive stock options to certain key employees of
ProMedex to acquire approximately 715,000 shares of Landacorp stock.
The principal terms of the PatientCentrix acquisition, which became effective on
November 2, 2000, include $2 million in cash to the shareholders, and $3.2
million in cash to the shareholders and option holders of PatientCentrix,
pro-rata to their rights to PatientCentrix stock. Additionally, based on the
total contract value of sales for PatientCentrix software and services capped at
$50 million in orders for the twelve months from the closing of the acquisition;
up to $6 million in additional cash will be paid to the shareholders and option
holders of PatientCentrix, prorata to their rights to PatientCentrix stock.
Prior to the closing, PatientCentrix was also allowed to distribute its cash to
its shareholders and option holders pro rata to their rights to PatientCentrix
stock. Landacorp issued 1,157,000 shares of its stock to the PatientCentrix
stockholders and Landacorp assumed the PatientCentrix option plan that has
issued rights to acquire up to approximately 1,583,000 shares of Landacorp.
Landacorp has the right to repurchase up to 30% of the stock and cancel up to
30% of the options, should key individuals leave the company within the first
three years. Additionally, 10% of the all of the acquisition consideration is
subject to escrow arrangements.
The shares of common stock of Landacorp that were issued to acquire
PatientCentrix and ProMedex are restricted. However, Landacorp has granted
standard "piggy-back" registration rights to the shares used to acquire the
business and assets of ProMedex. Landacorp has granted registration rights to
the shares used to acquire the PatientCentrix business, including unlimited
"piggy-back" registrations, subject to any applicable underwriter cut-back, and
one demand
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LANDACORP POSTS RECORD THIRD-QUARTER RESULTS
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NOVEMBER 2, 2000
registration right pursuant to which the shareholders may demand that Landacorp
file a registration statement on Form S-3 to register up to all of the shares of
Landacorp common stock held by them; provided, however, that such demand right
shall only be exercisable on or after the first anniversary of Landacorp's
initial public offering, and then, only if the average closing price for one
share of Landacorp common stock for the ten days prior to the date of such
exercise, as quoted on the Nasdaq Stock Market, exceeds $7.00.
Further discussion of these acquisitions will take place during a conference
call on Friday, November 3, 2000. The call may be heard online at:
www.landacorp.com, www.StreetEvents.com, or www.vcall.com beginning at 11:00
a.m. ET.
LANDACORP: THE E-MEDICAL MANAGEMENT COMPANY
Landacorp offers healthcare payers and providers Internet- and Windows-based
medical management solutions that are designed to control the cost and improve
the quality of healthcare delivery. Landacorp's medical management
solutions--MAXSYS II(TM) for healthcare providers, and MAXMC(TM) and E-MAXMC(TM)
for managed care organizations--automate and streamline administrative and
business processes, minimize inefficient paper-, fax-, and phone-based
communications, and facilitate interaction among various healthcare
participants. The company's products are implemented at more than 160 client
sites.
Through its recently acquired iHealthMedia(sm) division, Landacorp also provides
interactive media strategies, and Internet and extranet site development to help
payers and providers better connect with their stockholders.
Landacorp's corporate headquarters and sales and marketing offices are located
in Atlanta, GA. Research and development and client services operations are
located in Chico, CA. iHealthMedia.com is located in Portland, OR. Additional
sales and service offices are located across the country.
This release contains information about future expectations, financial
performance, plans and prospects of Landacorp's management that constitute
forward-looking statements for purposes of the safe harbor provisions under The
Private Securities Litigation Reform Act of 1995. Actual results may differ
materially from those indicated by these forward-looking statements as a result
of various important factors including, but not limited to, Landacorp's
dependence on a limited number of products with limited market acceptance and
other factors that are discussed in the Company's Registration Statement on Form
S-1 and other documents periodically filed with the SEC. Examples of such
forward looking statements include statements about anticipated markets for
population health management services; statements about synergies among our
products and the product offerings of ProMedex and PatientCentrix; and
statements about expected revenue opportunities and growth resulting from the
combination of Landacorp, ProMedex and PatientCentrix. These statements involve
risks and uncertainties including, but not limited to, the risk that the market
for population health management services does not develop as anticipated; and
the risk that we are unable to successfully integrate our products with ProMedex
and PatientCentrix products and capitalize on the anticipated synergies and
revenue growth opportunities resulting from the combination of the companies.
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LANDACORP POSTS RECORD THIRD-QUARTER RESULTS
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NOVEMBER 2, 2000
LANDACORP, INC.
<TABLE>
<CAPTION>
IN $'000s EXCEPT PER SHARE DATA
Condensed Statement of Operations: Three months Nine months
ended Sept 30, ended Sept 30,
2000 1999 2000 1999
(unaudited)
<S> <C> <C> <C> <C>
Total revenues 3,968 2,416 9,643 7,067
Costs and expenses:
Cost of revenues 1,269 890 3,740 2,663
Sales and marketing 1,600 790 4,927 2,294
Research and development 1,013 470 2,505 1,241
General and administrative 1,155 837 3,480 2,393
Total costs and expenses 5,037 2,987 14,652 8,591
Loss from operations (1,069) (571) (5,009) (1,524)
Interest and other income 548 27 1,331 76
Interest expense (9) (4) (34) (4)
Net loss (530) (548) (3,712) (1,452)
Net loss per share:
Basic and diluted (0.04) (0.42) (0.33) (1.21)
Net loss, pre-adjustment (see above) (530) (548) (3,712) (1,452)
Add back of adjusting items (see below) 464 514 1,965 1,512
Adjusted net (loss)/profit (66) (34) (1,747) 60
Adjusted net (loss)/profit per share:
Basic (0.005) (0.03) (0.15) 0.05
</TABLE>
Adjusted net loss and Adjusted net loss per share excludes stock-based
compensation, goodwill amortization arising from the purchase of
iHealthMedia.com and a one-time IPO-related bonus payment to an officer.
Adjusted net loss and Adjusted net loss per share are not standard accounting
terms or ratios as defined by GAAP and should not be used instead of the, or as
the preferred, standard Net loss and Net loss per share calculations to evaluate
our company's performance.
The total number of shares used for the calculations of net loss per share are
as follows:
<TABLE>
<CAPTION>
THOUSANDS OF SHARES IN ISSUE
Weighted average shares: Three months Nine months
ended Sept 30, ended Sept 30,
2000 1999 2000 1999
(unaudited)
<S> <C> <C> <C> <C>
Basic and diluted shares in issue 12,976 1,293 11,352 1,204
</TABLE>
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Landacorp Posts Record Third-Quarter Results
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November 2, 2000
Landacorp, Inc.
Condensed Balance Sheet:
<TABLE>
<CAPTION>
In $'000s
(unaudited)
Sept. 30 Dec. 31
2000 1999
<S> <C> <C>
Assets:
Current assets:
Cash and cash equivalents 32,071 1,884
Accounts receivable and costs and estimated earnings
in excess of billings on uncompleted contracts, net 4,084 2,090
Other current assets 341 164
Total current assets 36,496 4,138
Property and equipment, net 1,456 1,057
Intangible assets, net 919 --
Capitalized software, net 49 61
Deferred offering costs -- 595
Other assets 16 8
Total assets 38,936 5,859
Liabilities:
Current liabilities:
Accounts payable 367 463
Accrued expenses 2,094 1,804
Deferred revenue and billings in excess of costs and
estimated earnings on uncompleted contracts 2,677 2,637
Current portion of long-term debt 259 277
Total current liabilities 5,397 5,181
Long-term debt, net of current portion 146 164
Current liabilities and long-term debt 5,543 5,345
Stockholders' equity:
Preferred Stock, $0.001 par value, aggregate liquidation amount
$8,160,000 at December 31, 1999; 8,000,000 shares authorized;
6,800,000 shares issued
and outstanding at December 31, 1999; none at Sept 30, 2000 -- 7
Common Stock, $0.001 par value, 15,000,000 shares
authorized; 2,610,000 and 13,706,000 shares issued
and outstanding 14 3
Additional paid-in capital 52,575 16,955
Notes receivable from officers (187) (189)
Unearned stock-based compensation (1,679) (2,645)
Accumulated deficit (17,330) (13,617)
Total stockholders' equity 33,393 514
Total liabilities and stockholders' equity 38,936 5,859
</TABLE>
Browse the Landacorp web-site at http://www.landacorp.com.
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Landacorp Posts Record Third-Quarter Results
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November 2, 2000
Landacorp, ProMedex, PatientCentrix, iHealthMedia, Maxsys II, maxMC, and e-maxMC
and their associated logos are trademarks, registered trademarks, or service
marks of Landacorp, Inc. Windows is a registered trademark of Microsoft
Corporation
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