<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
{X} QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
OR
{ } TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Transition period from ________ to ________
Commission file number 0-15846
HealthCare COMPARE Corp.
(Exact name of registrant as specified in its charter)
Delaware 36-3307583
-------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
3200 Highland Avenue, Downers Grove, Illinois 60515
(Address of principal executive offices, Zip Code)
(708) 241-7900
(Registrant's phone number, including area code)
__________________________
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
----------- ----------
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
The number of shares of Common Stock, par value $.01 per share, outstanding on
November 10, 1995 was 34,548,511.
<PAGE> 2
HealthCare COMPARE Corp. and Subsidiaries
INDEX
<TABLE>
<CAPTION>
Part I. Financial Information Page Number
-----------
<S> <C>
Item 1. Financial Statements
Consolidated Balance Sheets - Assets at September 30, 1995
and December 31, 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Consolidated Balance Sheets - Liabilities and Stockholders'
Equity at September 30, 1995 and December 31, 1994 . . . . . . . . . . . . 4
Consolidated Statements of Operations for the three months
ended September 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . 5
Consolidated Statements of Operations for the nine months
ended September 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . 6
Consolidated Statements of Cash Flows for the nine months
ended September 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . 7-8
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . 9-10
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . 11-13
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . 14
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Exhibit 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16-17
</TABLE>
2
<PAGE> 3
PART 1. FINANCIAL INFORMATION
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS September 30, 1995 December 31, 1994
------------------ -----------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents . . . . . . . . . . . . . . $ 46,017,000 $ 29,412,000
Short-term investments . . . . . . . . . . . . . . . . 82,990,000 37,043,000
Accounts receivable, less allowances for
doubtful accounts of $3,191,000
and $3,874,000, respectively . . . . . . . . . . . 27,528,000 24,386,000
Other current assets . . . . . . . . . . . . . . . . . 6,028,000 2,953,000
------------ ------------
Total current assets . . . . . . . . . . . . . . . . . 162,563,000 93,794,000
------------ ------------
Long-Term Investments:
Marketable securities . . . . . . . . . . . . . . . . 50,212,000 62,229,000
Other . . . . . . . . . . . . . . . . . . . . . . . . 16,355,000 10,000,000
------------ ------------
66,567,000 72,229,000
------------ ------------
Property and Equipment:
Buildings and improvements . . . . . . . . . . . . . . 32,786,000 31,940,000
Computer equipment and software . . . . . . . . . . . 26,868,000 25,236,000
Office furniture and equipment . . . . . . . . . . . . 17,377,000 16,235,000
------------ ------------
77,031,000 73,411,000
Less accumulated depreciation and
amortization . . . . . . . . . . . . . . . . . . . (33,775,000) (28,111,000)
------------ ------------
Net property and equipment . . . . . . . . . . . . . . 43,256,000 45,300,000
------------ ------------
Other Assets . . . . . . . . . . . . . . . . . . . . . . . 5,604,000 3,686,000
------------ ------------
$277,990,000 $215,009,000
============ ============
</TABLE>
3
<PAGE> 4
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
September 30, 1995 December 31, 1994
------------------ -----------------
<S> <C> <C>
Current Liabilities:
Accounts payable . . . . . . . . . . . . . . . . . . . . $ 6,502,000 $ 4,938,000
Accrued expenses . . . . . . . . . . . . . . . . . . . . 11,801,000 9,606,000
Income taxes payable . . . . . . . . . . . . . . . . . . -- 806,000
----------- ------------
Total current liabilities . . . . . . . . . . . . . . . 18,303,000 15,350,000
Non-Current Liabilities . . . . . . . . . . . . . . . . . . . 141,000 102,000
----------- ------------
Total liabilities . . . . . . . . . . . . . . . . . . . 18,444,000 15,452,000
----------- -----------
Commitments and Contingencies . . . . . . . . . . . . . . . . -- --
Stockholders' Equity:
Common stock . . . . . . . . . . . . . . . . . . . . . . 365,000 360,000
Additional paid-in capital . . . . . . . . . . . . . . . 102,384,000 89,798,000
Retained earnings . . . . . . . . . . . . . . . . . . . 192,015,000 143,533,000
Unrealized holding gain (loss) on marketable
securities . . . . . . . . . . . . . . . . . . . . . 151,000 (935,000)
Treasury stock, at cost . . . . . . . . . . . . . . . . (35,369,000) (33,199,000)
----------- -----------
Total stockholders' equity . . . . . . . . . . . . . . . 259,546,000 199,557,000
----------- -----------
$277,990,000 $215,009,000
=========== ===========
</TABLE>
4
<PAGE> 5
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended September 30,
------------------------------------
1995 1994
-------------------- --------------------
<S> <C> <C>
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . $54,238,000 $48,132,000
----------- -----------
Operating expenses:
Cost of services . . . . . . . . . . . . . . . . . . . 15,650,000 15,054,000
Selling and marketing . . . . . . . . . . . . . . . . 6,616,000 5,752,000
General and administrative . . . . . . . . . . . . . . 2,734,000 2,503,000
Depreciation and amortization . . . . . . . . . . . . 2,479,000 3,239,000
Interest income, net . . . . . . . . . . . . . . . . . (1,993,000) (1,238,000)
----------- -----------
25,486,000 25,310,000
----------- -----------
Income before income taxes . . . . . . . . . . . . . . . . 28,752,000 22,822,000
Income taxes . . . . . . . . . . . . . . . . . . . . . . . (11,500,000) (9,432,000)
----------- -----------
Net income . . . . . . . . . . . . . . . . . . . . . . . . $17,252,000 $13,390,000
=========== ===========
Weighted average common and
common share equivalents . . . . . . . . . . . . . . . . 35,057,000 34,330,000
=========== ===========
Net income per common share . . . . . . . . . . . . . . . . $ .49 $ .39
=========== ===========
</TABLE>
5
<PAGE> 6
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------------
1995 1994
-------------------- --------------------
<S> <C> <C>
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . $158,677,000 $137,165,000
------------ ------------
Operating expenses:
Cost of services . . . . . . . . . . . . . . . . . . . 47,777,000 46,963,000
Selling and marketing . . . . . . . . . . . . . . . . 19,279,000 16,443,000
General and administrative . . . . . . . . . . . . . . 8,204,000 7,665,000
Depreciation and amortization . . . . . . . . . . . . 7,845,000 7,998,000
Interest income, net . . . . . . . . . . . . . . . . . (5,713,000) (3,637,000)
------------ ------------
77,392,000 75,432,000
------------ ------------
Income before income taxes . . . . . . . . . . . . . . . . 81,285,000 61,733,000
Income taxes . . . . . . . . . . . . . . . . . . . . . . . (32,803,000) (25,002,000)
------------ ------------
Net income . . . . . . . . . . . . . . . . . . . . . . . . $ 48,482,000 $ 36,731,000
============ ============
Weighted average common and
common share equivalents . . . . . . . . . . . . . . . . 35,020,000 35,034,000
============ ============
Net income per common share . . . . . . . . . . . . . . . . $ 1.38 $ 1.05
============ ============
</TABLE>
6
<PAGE> 7
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------------
1995 1994
-------------------- --------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers . . . . . . . . . . . . . . . . $155,985,000 $135,695,000
Cash paid to suppliers and employees . . . . . . . . . . . . (72,370,000) (68,860,000)
Interest received, net . . . . . . . . . . . . . . . . . . . 5,997,000 4,448,000
Income taxes paid, net . . . . . . . . . . . . . . . . . . . (34,388,000) (23,121,000)
----------- -----------
Net cash provided by operating activities . . . . . . . . . 55,224,000 48,162,000
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investments . . . . . . . . . . . . . . . . . . (133,970,000) (61,806,000)
Sales of investments . . . . . . . . . . . . . . . . . . . . 94,503,000 53,517,000
Purchase of property and equipment . . . . . . . . . . . . . (5,821,000) (5,821,000)
----------- -----------
Net cash used in investing activities . . . . . . . . . . . (45,288,000) (14,110,000)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sales of put options on common stock . . . . . . -- 778,000
Purchase of treasury stock . . . . . . . . . . . . . . . . . (2,170,000) (28,130,000)
Proceeds from issuance of common stock . . . . . . . . . . . 8,839,000 3,932,000
----------- -----------
Net cash provided by (used in) financing activities . . . . 6,669,000 (23,420,000)
----------- -----------
NET INCREASE IN CASH AND CASH EQUIVALENTS . . . . . . . . . . . . 16,605,000 10,632,000
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD . . . . . . . . . 29,412,000 23,425,000
----------- -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD . . . . . . . . . . . . $46,017,000 $34,057,000
========== ==========
</TABLE>
7
<PAGE> 8
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------------
1995 1994
-------------------- --------------------
<S> <C> <C>
RECONCILIATION OF NET INCOME TO NET CASH PROVIDED BY
OPERATING ACTIVITIES:
NET INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $48,482,000 $36,731,000
----------- -----------
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Depreciation and amortization . . . . . . . . . . . . . . . . 7,845,000 7,998,000
Change in provision for uncollectible receivables . . . . . . (683,000) 510,000
Amortization of bond premiums . . . . . . . . . . . . . . . . 1,061,000 930,000
Tax benefit from stock options and unrealized
holding (gain) loss on marketable securities, net . . . . . 3,017,000 1,720,000
(Gain) loss on sale of investments . . . . . . . . . . . . . (58,000) 152,000
Loss on property disposal . . . . . . . . . . . . . . . . . . 20,000 --
Changes in Assets and Liabilities:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . (2,459,000) (748,000)
Other current assets . . . . . . . . . . . . . . . . . . . . (3,075,000) (688,000)
Other assets . . . . . . . . . . . . . . . . . . . . . . . . (1,918,000) 14,000
Accounts payable . . . . . . . . . . . . . . . . . . . . . . 1,564,000 (526,000)
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . 2,195,000 1,882,000
Income taxes payable . . . . . . . . . . . . . . . . . . . . (806,000) 161,000
Other liabilities . . . . . . . . . . . . . . . . . . . . . . 39,000 26,000
----------- -----------
TOTAL ADJUSTMENTS . . . . . . . . . . . . . . . . . . . . . . . . 6,742,000 11,431,000
----------- -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES . . . . . . . . . . . . $55,224,000 $48,162,000
=========== ===========
</TABLE>
8
<PAGE> 9
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. The unaudited financial statements herein have been prepared by the Company
pursuant to the rules and regulations of the Securities and Exchange
Commission. The accompanying interim financial statements have been
prepared under the presumption that users of the interim financial
information have either read or have access to the audited financial
statements for the latest fiscal year ended December 31, 1994.
Accordingly, footnote disclosures which would substantially duplicate the
disclosures contained in the December 31, 1994 audited financial statements
have been omitted from these interim financial statements. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations. Although the Company believes that the disclosures are
adequate to make the information presented not misleading, it is suggested
that these interim financial statements be read in conjunction with the
financial statements and the notes thereto included in the Company's latest
Annual Report on Form 10-K.
2. The Company's investments in marketable securities which are classified as
available for sale had a net unrealized gain in market value of $1,086,000,
net of deferred income taxes, for the nine months ended September 30, 1995.
The net unrealized gain at September 30, 1995, included as a component of
stockholders' equity, was $151,000, net of deferred income taxes. The
Company's $10,000,000 investment in a limited partnership is carried at
cost. The current value of the Company's interest in the limited
partnership at September 30, 1995, as reported by the partnership, was
$9,936,000. In the third quarter of 1995, the Company invested $6,355,000
in another limited partnership which is being accounted for under the
equity method of accounting. The Company's proportionate share of the
partnership's income was $57,000 for the three months ended September 30,
1995 and is included in interest income.
3. Commitments and Contingencies
Litigation: In April 1993, seven lawsuits were filed in the United States
District Court for the Northern District of Illinois alleging violations of
Federal securities laws by the Company and two of its executive officers.
The plaintiffs allege, among other things, that the defendants made false
and misleading statements regarding the Company's financial prospects for
1993, which they further allege resulted in the price of the Company's
common stock being inflated during the period in question. The plaintiffs
seek compensatory damages, pre-and post-judgement interest, and the costs
and disbursements of the lawsuits, including reasonable attorneys' and
experts' fees. The lawsuits have been consolidated and in May, 1993, the
defendants filed a motion to dismiss the consolidated complaint. The
plaintiffs filed a motion for class certification in June, 1993, and
defendants subsequently filed their opposition to class certification. In
November 1993, the presiding Magistrate Judge recommended that the
consolidated complaint be dismissed and subsequently stayed all proceedings
involving class certification and discovery. Plaintiffs appealed the
Magistrate's ruling to the presiding Federal Judge who, in June, 1994,
affirmed the dismissal of the complaint. In August 1994, the Federal Judge
entered an order allowing the plaintiffs to file
9
<PAGE> 10
an amended complaint, and in February 1995, the Federal Judge denied the
Company's motion to dismiss the plaintiffs' amended complaint. The
presiding Federal Judge subsequently certified, for review by the Seventh
Circuit Court of Appeals, the issue of whether the amended complaint should
be dismissed. The Seventh Circuit Court of Appeals accepted the
certification and the matter was duly briefed before the Court of Appeals.
In October, oral arguments were presented to the panel from the Seventh
Circuit Court of Appeals. The Court has not yet ruled on the defendant's
motion to dismiss. Management continues to believe that the plaintiffs'
claims are without merit and is vigorously contesting these actions.
However, the ultimate outcome of the litigation cannot presently be
determined. Accordingly, no provision for liability, if any, that may
result upon resolution of the matter has been made in the financial
statements.
10
<PAGE> 11
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
(UNAUDITED)
RESULTS OF OPERATIONS
Revenues for the three and nine months ended September 30, 1995
increased $6,106,000 (13%) and $21,512,000 (16%), respectively, from the
comparable periods of 1994. The Company's revenues consist of fees for cost
management services provided under contracts which typically require clients to
pay based upon a percentage of savings or on a predetermined contractual basis
(fee-based revenue). The Company also derives revenues based on a fixed
monthly fee for each participant, excluding covered dependents, in a
client-sponsored health care plan (capitated revenue). The fee varies based
upon the programs selected. Fee-based revenue has increased substantially from
1989 to the present as COMPARE has significantly expanded its PPO networks.
The following tables set forth information with respect to the types
and sources of the Company's revenues for the three and nine months ended
September 30, 1995 and 1994:
TYPES OF REVENUE
($ in thousands)
<TABLE>
<CAPTION>
Three Months Ended September 30, Nine Months Ended September 30,
------------------------------------------------ -----------------------------------------
1995 % 1994 % 1995 % 1994 %
---- - ---- - ---- - ---- -
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Fee-based Revenue $48,392 89% $41,619 86% $140,508 89% $117,250 85%
Capitated Revenue 5,846 11 6,513 14 18,169 11 19,915 15
------- -- ------- -- --------- -- -------- --
Total $54,238 100% $48,132 100% $158,677 100% $137,165 100%
====== === ====== === ======= === ======= ===
</TABLE>
SOURCES OF REVENUE
($ in thousands)
<TABLE>
<CAPTION>
Three Months Ended September 30, Nine Months Ended September 30,
----------------------------------------- -------------------------------------
1995 % 1994 % 1995 % 1994 %
----- -- ---- -- ---- -- ----- --
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PPO Services $42,421 78% $36,310 75% $122,513 77% $102,731 75%
Utilization Mgmt.
Services 6,389 12 6,455 14 19,458 12 19,022 14
Fee Schedule Services 3,960 7 3,897 8 12,418 8 10,572 8
Government Contract
Services 1,468 3 1,470 3 4,288 3 4,840 3
------- --- ------ --- ------- --- ------ ---
Total $54,238 100% $48,132 100% $158,677 100% $137,165 100%
====== === ====== === ======= === ======= ===
</TABLE>
11
<PAGE> 12
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
(UNAUDITED) (CONT'D.)
The growth in revenue during the three and nine months ended September
30, 1995 from the comparable periods of 1994 is primarily attributable to the
expansion and development of the Company's PPO services. PPO revenue increased
$6,111,000 (17%) and $19,782,000 (19%), respectively, from the same periods of
1994. This growth is the result of new client additions and increased
utilization of the PPO network by existing clients. Revenue from utilization
management (U/M) services decreased $66,000 (1%) and increased $436,000 (2%)
for the three and nine months ended September 30, 1995, respectively, from the
comparable periods in 1994. Revenue from fee schedule services increased
$63,000 (2%) and $1,846,000 (17%) for the three and nine months ended September
30, 1995, respectively, from the comparable periods in 1994 due to new client
additions and increased revenue from several existing clients. Government
contract revenue decreased $2,000 (0%) and $552,000 (11%) from the same periods
in 1994 due to the successful completion of the regional review portion of the
Company's CHAMPUS contract.
Cost of services increased $596,000 (4%) and $814,000 (2%) for the
three and nine months ended September 30, 1995, respectively, from the
comparable periods of 1994. Cost of services consists primarily of salaries
for personnel involved in PPO administration, development and expansion,
utilization management programs, fee schedule and other cost management
services offered by the Company. To a lesser extent, cost of services includes
telephone expenses, facility expenses and information processing costs. The
increase in these costs is primarily attributable to expenses incurred in the
development of the Company's risk-based products. For the nine months ended
September 30, 1995, cost of services increased only 2% on a 16% revenue
increase due to the Company's consolidation of various California operations
into one facility and due to the fixed cost nature of the PPO business.
Selling and marketing costs increased $864,000 (15%) and $2,836,000
(17%) for the three and nine months ended September 30, 1995 from the same
periods of 1994, primarily as a result of the hiring of additional sales
personnel.
General and administrative costs for the three and nine months ended
September 30, 1995 increased $231,000 (9%) and $539,000 (7%), respectively,
from the comparable periods of 1994. This increase is primarily attributable
to the utilization of outside professional services in connection with the
Company's efforts to acquire an insurance company.
Depreciation and amortization expenses decreased $760,000 (23%) and
$153,000 (2%) for the three and nine months ended September 30, 1995 from the
comparable periods of 1994, principally as a result of shortening the useful
life of certain assets in 1994 which resulted in higher depreciation expense in
1994.
Interest income for the three and nine months ended September 30, 1995
increased $755,000 (61%) and $2,076,000 (57%), respectively, from the same
periods in 1994 due to a 50% increase in the amount of cash equivalents and
investments since September 30, 1994.
12
<PAGE> 13
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
(UNAUDITED) (CONT'D.)
Net income for the three and nine months ended September 30, 1995
increased $3,862,000 (29%) and $11,751,000 (32%), respectively, from the
comparable periods of 1994. This increase is due primarily to the growth in
revenues from the Company's PPO services occurring at a more rapid pace than
the growth of related expenses.
LIQUIDITY AND CAPITAL RESOURCES
The Company had $144,260,000 in working capital at September 30, 1995
compared with working capital of $78,444,000 at December 31, 1994. Cash
equivalents and short- and long-term investments increased to $195,574,000 at
September 30, 1995 from $138,684,000 at December 31, 1994, primarily as the
result of cash provided by operating activities and, to a lesser extent, cash
received upon the exercise of stock options. Through the first nine months of
the year, operating activities provided $55,224,000 of cash.
The Company believes that its working capital, long-term investments,
and cash generated from future operations will be sufficient to fund the
Company's anticipated operations and expansion plans.
13
<PAGE> 14
PART II
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 11 - Computation of Primary Earnings Per Common Share
(b) Exhibit 11 - Computation of Fully Diluted Earnings Per Common
Share
14
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
HealthCare COMPARE Corp.
Dated: November 13, 1995 /s/James C. Smith
------------------------------------------
James C. Smith
President and Chief Executive Officer
Dated: November 13, 1995 /s/Joseph E. Whitters
------------------------------------------
Joseph E. Whitters
Chief Financial Officer
(Principal Financial and Accounting Officer)
15
<PAGE> 1
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES EXHIBIT 11
COMPUTATION OF PRIMARY EARNINGS PER COMMON SHARE
(UNAUDITED)
________________________________________________________________________________
<TABLE>
<CAPTION>
Three Months Ended September 30,
--------------------------------
1995 1994
------------ ------------
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . $17,252,000 $13,390,000
========= ==========
Weighted average number of common shares
outstanding:
Shares outstanding from beginning of period . . . . . . . . 34,253,000 33,892,000
Other issuances of common stock . . . . . . . . . . . . . . 96,000 35,000
Purchases of treasury stock . . . . . . . . . . . . . . . . -- (16,000)
Common Stock Equivalents:
Additional equivalent shares issuable from
assumed exercise of common stock options . . . . . . . . . 708,000 419,000
---------- -----------
Weighted average common and common share
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . 35,057,000 34,330,000
=========== =============
Net income per common share . . . . . . . . . . . . . . . . . . . $ .49 $ .39
============ =============
</TABLE>
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------
1995 1994
------------ ------------
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . $48,482,000 $36,731,000
========== ==========
Weighted average number of common shares
outstanding:
Shares outstanding from beginning of period . . . . . . . . 34,034,000 35,033,000
Other issuances of common stock . . . . . . . . . . . . . . 261,000 206,000
Purchases of treasury stock . . . . . . . . . . . . . . . . (58,000) (695,000)
Common Stock Equivalents:
Additional equivalent shares issuable from
assumed exercise of common stock options . . . . . . . . . 783,000 490,000
----------- -----------
Weighted average common and common share
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . 35,020,000 35,034,000
========== ==========
Net income per common share . . . . . . . . . . . . . . . . . . . $ 1.38 $ 1.05
============= =============
</TABLE>
16
<PAGE> 2
EXHIBIT 11
HEALTHCARE COMPARE CORP. AND SUBSIDIARIES
COMPUTATION OF FULLY DILUTED EARNINGS PER COMMON SHARE
(UNAUDITED)
________________________________________________________________________________
<TABLE>
<CAPTION>
Three Months Ended September 30,
--------------------------------
1995 1994
------------ ------------
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . $17,252,000 $13,390,000
========== ==========
Weighted average number of common shares
outstanding:
Shares outstanding from beginning of period . . . . . . . . 34,253,000 33,892,000
Other issuances of common stock . . . . . . . . . . . . . . 96,000 35,000
Purchases of treasury stock . . . . . . . . . . . . . . . . -- (16,000)
Common Stock Equivalents:
Additional equivalent shares issuable from
assumed exercise of common stock options . . . . . . . . . 840,000 698,000
---------- ----------
Weighted average common and common share
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . 35,189,000 34,609,000
========== ==========
Net income per common share . . . . . . . . . . . . . . . . . . . $ .49 $ .39
========== ==========
</TABLE>
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------
1995 1994
------------ ------------
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . $48,482,000 $36,731,000
========== ==========
Weighted average number of common shares
outstanding:
Shares outstanding from beginning of period . . . . . . . . 34,034,000 35,033,000
Other issuances of common stock . . . . . . . . . . . . . . 261,000 206,000
Purchases of treasury stock . . . . . . . . . . . . . . . . (58,000) (695,000)
Common Stock Equivalents:
Additional equivalent shares issuable from
assumed exercise of common stock options . . . . . . . . . 848,000 610,000
---------- ----------
Weighted average common and common share
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . 35,085,000 35,154,000
========== ==========
Net income per common share . . . . . . . . . . . . . . . . . . . $ 1.38 $ 1.05
========== ==========
</TABLE>
17
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<CURRENCY> USD
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JUL-01-1995
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1
<CASH> 46,017
<SECURITIES> 149,557
<RECEIVABLES> 30,719
<ALLOWANCES> (3,191)
<INVENTORY> 0
<CURRENT-ASSETS> 162,563
<PP&E> 77,031
<DEPRECIATION> (33,775)
<TOTAL-ASSETS> 277,990
<CURRENT-LIABILITIES> 18,303
<BONDS> 0
<COMMON> 365
0
0
<OTHER-SE> 259,181
<TOTAL-LIABILITY-AND-EQUITY> 277,990
<SALES> 0
<TOTAL-REVENUES> 56,231
<CGS> 0
<TOTAL-COSTS> 25,000
<OTHER-EXPENSES> 2,479
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 28,752
<INCOME-TAX> 11,500
<INCOME-CONTINUING> 17,252
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,252
<EPS-PRIMARY> 0.49
<EPS-DILUTED> 0.49
</TABLE>
