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Exhibit 99.1
CONTACTS:
INVESTOR RELATIONS:
Risa Fisher
201/703-3415
MEDIA:
Dawn Whaley
404/881-2321
[email protected]
WEBMD BOARD OF DIRECTORS APPROVES STRATEGIC PLAN TO STREAMLINE
BUSINESS AND ACCELERATE PATH TO PROFITABILITY
EXECUTION OF INTEGRATION PLAN EXPECTED TO RESULT IN $250 MILLION IN
ANNUALIZED COST SAVINGS AND A THIRD QUARTER RESTRUCTURING CHARGE
ANTHONY VUOLO APPOINTED CHIEF FINANCIAL OFFICER
JACK D. DENNISON AND CHARLES A. MELE APPOINTED CO-GENERAL COUNSEL
ATLANTA (SEPTEMBER 28, 2000) - WebMD Corporation (NASDAQ: HLTH)
announced today that it anticipates total annualized savings of approximately
$250 million to be realized by the fourth quarter of 2001 resulting from the
execution of the first phase of the Company's integration plan. This phase of
the plan, which was approved by its Board of Directors, includes a consolidation
of offices and data centers and reduction in marketing and promotional expenses,
the result of which substantially eliminates the redundancies that were created
in the combination of WebMD with recently acquired companies, Envoy, Medical
Manager, CareInsite and OnHealth. The plan will result in the elimination of
approximately 1,100 jobs by the end of calendar year 2001. The Company
anticipates taking a pre-tax restructuring charge of between $35 million and $45
million in the quarter ended September 30, 2000. As a result of the execution of
this phase of the plan, the Company expects to incur additional costs related to
moving and relocations that will be expensed as incurred in accordance with the
applicable accounting guidelines. Additionally, the Company is evaluating many
of its business relationships that are currently in place. It is possible that
some of those relationships may be revised or terminated, which may result in
additional restructuring charges in future quarters.
WebMD also announced today that it will divest its plastics and
filtration technologies subsidiaries. WebMD has received indications of interest
from several potential buyers and plans to explore various divestiture
alternatives in consultation with financial advisors.
The Company will now focus on its core business which encompasses
enabling healthcare transactions and connectivity, providing the software and
services that automate the physician's practice and
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providing Internet-based content, applications and services for physicians,
payers, other healthcare organizations and consumers.
"While we are reducing expenses through the consolidation of operations
and the elimination of redundancy, the focus of our integration process is to
create a streamlined organization with a unified set of goals and objectives. An
important step in creating an efficient organization is aligning our development
resources with proven domain expertise. For example, the continued development
of administrative applications will reside at Envoy in Tennessee, clinical
application development will reside at Medical Manager Health Systems in Florida
and Internet-based content, applications and services development will reside in
Santa Clara. As a result of having the right set of combined assets and
management team in place, we believe that we will be able to offer an
unparalleled set of value-added services to physicians, payers and other
healthcare organizations," said Marv Rich, President of WebMD.
Mr. Rich continued, "A comprehensive integration which results in job
reductions is a difficult time at any company. At WebMD, while we are committed
to doing what is necessary to ensure a strong future for the Company, we are
equally committed to ensuring that all employees are treated fairly and
professionally. Employees separating from the Company as a result of the job
reductions will be provided with severance packages and outplacement counseling
to help with the transition."
The company plans to provide more details on the integration plan and
its future operations at an analyst/investor meeting in New York City on
Thursday, October 12, 2000. This meeting will also be available via audio
conference.
Several significant management changes were also announced today.
Anthony Vuolo has been named Executive Vice President, Chief Financial Officer
and Treasurer, filling the vacancy created by the retirement of John L.
Westermann III. Until WebMD's merger with Medical Manager and CareInsite, Mr.
Vuolo had been Senior Vice President of Business Development at Medical Manager.
Jeff Arnold, Co-CEO of WebMD said, "Tony has spent his entire career providing
leadership and innovation to the financial operations of aggressive, high-growth
companies. His breadth of experience ranges from managing financial operations
and systems integration to structuring complex corporate transactions. His
understanding of the healthcare industry and our company's mission give him the
ability to make an immediate contribution to WebMD's success."
Charles A. Mele, former General Counsel of Medical Manager Corporation,
will join Jack D. Dennison as Co-General Counsel of WebMD. For the last five
years, Mr. Mele has been Executive Vice President and General Counsel of Medical
Manager Corporation and prior to that time was Executive Vice President and
General Counsel for Medco Containment Services for over ten years. Mr. Dennison
is currently Executive Vice President, General Counsel and Secretary of WebMD.
Prior to joining the Company in July 1998, Mr. Dennison was Deputy General
Counsel of Computer Sciences Corporation and Vice President and General Counsel
of The Continuum Company, Inc.
Martin J. Wygod, Co-CEO of WebMD said, "Given the complexity of our
business and the nature of the industry's legal and regulatory environment, we
have created a position that will allow us to leverage Jack's and Charlie's
unique skills and experience. These skills will prove invaluable as we
rationalize many of the Company's complex business relationships in order to
more effectively bring our services to the leading payers and healthcare
organizations across the country."
ABOUT WEBMD
WebMD provides connectivity and a full suite of services to the healthcare
industry that improve
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administrative efficiencies and clinical effectiveness enabling high-quality
patient care. The company's products and services facilitate information
exchange, communication and transactions between the consumer, physician and
healthcare institutions. The company's corporate headquarters are located in
Atlanta.
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All statements contained in this press release, other than statements of
historical fact, are forward-looking statements, including those regarding:
future financial results of WebMD; the amount and timing of the benefits
expected from WebMD's integration plan and of the costs of executing such plan;
and potential changes in WebMD's business relationships. These statements are
based on WebMD's current plans and expectations and involve risks and
uncertainties that could cause actual future events or results to be different
from those described in or implied by such forward-looking statements. These
risks and uncertainties include those relating to: market acceptance of WebMD's
products and services; operational difficulties relating to combining acquired
companies and businesses; the profit potential of WebMD's strategic
relationships and customer contracts; economic conditions and regulatory matters
affecting the Internet and healthcare industries; and the ability of WebMD to
attract and retain qualified personnel. Further information about these matters
can be found in WebMD's Securities and Exchange Commission filings. WebMD
expressly disclaims any intent or obligation to update these forward-looking
statements.
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