SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of Earliest Event Reported): January 31, 2000
MEDICAL MANAGER CORPORATION
(Exact name of registrant as specified in charter)
DELAWARE 0-17822 22-2975182
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation) Identification No.)
669 River Drive, River Drive Center II 07407
Elmwood Park, NJ (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (201) 703-3400
Exhibit Index Appears on page 2.
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2
Item 5. Other Events.
Medical Manager Corporation issued on January 31, 2000 the press
release attached hereto as Exhibit 99.1. Such press release is incorporated
herein by reference.
Exhibit Index
Exhibit No. Description
- ----------- -----------
99.1 Press Release, dated January 31, 2000
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3
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 hereunto duly authorized.
MEDICAL MANAGER CORPORATION
Date: January 31, 2000 By: /s/ James R. Love
-----------------------------------
Name: James R. Love
Executive Vice President --
Finance and Administration
and Chief Financial Officer
Contact: James R. Love
Executive Vice President and
Chief Financial Officer
(201) 703-3400
MEDICAL MANAGER ANNOUNCES SECOND QUARTER RESULTS
ELMWOOD PARK, NEW JERSEY, January 31, 1999 - Medical Manager
Corporation (NASDAQ: MMGR) announced today financial results for the quarter
ended December 31, 1999. Revenues for the period were $79,932,000, as compared
to $65,056,000 in the prior year, an increase of 23%. Net income for the period
was $17,445,000 or $0.43 per share compared with $2,833,000 or $0.08 per share
in the prior year. Excluding the impact of certain non-recurring items discussed
below, net income for the quarter was $798,000 or $0.02 per share, as compared
to $5,777,000 or $0.16 per share in the prior year. The decrease in net income
and income per share reflects the increased investment in the development of
CareInsite's business. Non-recurring items for the current period include a net
pre-tax gain on the sale of investments of $24,887,000 and a pre-tax charge
related to certain litigation of $450,000. Non-recurring items for the prior
year period include a pre-tax write-off of capitalized software of $2,381,000
and pre-tax charges related to certain litigation of $2,366,000.
Revenues at Medical Manager Health Systems for the quarter were
$48,425,000, an increase of 15% over prior year. EBITDA increased 30% to
$9,744,000, as compared to $7,496,000 in the prior year. During the quarter,
Medical Manager announced the signing of an agreement to acquire Physician
Computer Network (PCN), a leading provider of physician practice management
systems with an installed base of approximately 55,000 physicians. This
acquisition, which is expected to close in the spring of 2000, is subject to the
confirmation of the Plan of Reorganization filed by PCN with the U.S. Bankruptcy
Court and certain other customary conditions to closing. With the acquisition of
PCN, Medical Manager's installed base increases to 185,000 physicians in 33,000
sites. Medical Manager and PCN also extended their previously announced
exclusive arrangement to offer CareInsite's web-based physician portal services
and clinical e-commerce transactions to PCN's entire client base. John Kang,
Co-CEO of Medical Manager said, "We are working closely with PCN in anticipation
of closing the acquisition this spring. We have completed our initial
acquisitions of key strategic independent PCN dealerships and are in various
stages of discussions with other key PCN dealerships to continue to strengthen
our premier network of company-owned and independent dealers." He continued,
"Operationally, upgrading users to Version 9 and increasing penetration of our
network services offering continues to have a strong impact on our results. In
addition, we have received a tremendous interest in our newest products,
OmniChart and OmniDocs and we are expecting a broad roll-out of Intergy in the
latter part of calendar 2000."
In following its strategy of adding additional products and services
which leverage Medical Manager's strong installed base, the Company acquired
Mednetrix, Inc. in January 2000, a leading provider of custom web sites for
physicians. Mednetrix, which is located in Boca Raton, Florida, designs,
produces and hosts content-rich websites for physician practices. Mednetrix's
unique website development tools will be offered to physician practices across
the United States. Mr. Kang said, "Mednetrix's impressive technology and
approach to building physician web sites reinforces our philosophy of providing
feature-rich products to the health care community which enhance a physician's
ability to practice medicine. Physician sites developed with Mednetrix tools are
differentiated in that they provide an Internet presence, branding, and
e-commerce opportunity for the medical practice. Physicians can provide
education materials, as well as communicate and participate in e-commerce
directly with their patients."
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Revenues at CareInsite for the quarter were $1,501,000. There were no
revenues in the prior year period. EBITDA was $(12,642,000) as compared to
$(3,980,000) in the prior year. During the quarter, CareInsite also recognized a
gain resulting from the sale of investments of $25,511,000. CareInsite continued
to strengthen its presence in the New York metropolitan area with the expansion
of its existing relationships with Empire Blue Cross and Blue Shield, Group
Health Incorporated, HIP Health Plans and Greater New York Hospital Association.
These leading healthcare organizations, who already participate in CareInsite's
physician services network, will be the initial participants in CareInsite's
consumer health services network. As previously announced, CareInsite also
acquired in January the remaining 80% equity interest in The Health Information
Network Connection (THINC) that it did not already own.
Commenting on the second quarter results, Marvin P. Rich, CEO of
CareInsite, said, "We are excited to expand our relationships with the New York
area's leading payers. These payers, and their 7 million members, will benefit
from CareInsite's comprehensive suite of physician and member services. As of
the end of December, CareInsite was processing transactions for more than 3,500
physicians in the New York/New Jersey area. The integration of CareInsite's
services with the practice management systems of Medical Manager and others is
proceeding as planned and our physician portal will be launched shortly. As a
result of these initiatives and our expanded relationships with the New York
area's leading payers, we expect to continue to grow both the number of
physicians and the breadth of services offered."
Revenues at Porex Corporation, the Company's plastic and filtration
technologies subsidiary, for the quarter were $30,006,000, an increase of 30%
over prior year. EBITDA increased 16% to $9,474,000, as compared to $8,144,000
in the prior year. "During the quarter, Porex acquired important new separations
technology," said Kim Davis, President and CEO of Porex. He continued, "This new
technology adds substantial breadth and depth to the products and technology of
the company's Porous Products Group. Porex continues to focus on new business
opportunities through the acquisition of new technologies and the expansion of
current and new markets."
Martin J. Wygod, Chairman of Medical Manager, said, "These results mark
another quarter of significant accomplishments across all three of our
businesses. We continue to pursue strategic transactions in each business line
that will enhance our product and service offerings and create long-term value
for shareholders. I am particularly pleased with the pipeline of transactions
and the negotiations taking place at CareInsite. Numerous regional and national
payers, as well as strategic partners, have endorsed our product and service
offerings and we expect to jointly announce the completion of definitive
agreements related to these discussions in the near future."
The Company currently has approximately $440,000,000 in cash and
marketable securities to be used for general corporate purposes, as well as
acquisitions and other strategic transactions. This amount includes
approximately $116,000,000 in cash and marketable securities at CareInsite.
Medical Manager Corporation is publicly traded on NASDAQ and operates
three lines of business. Medical Manager Health Systems is a leading provider of
physician practice management systems. Porex Corporation is a leader in the
development, manufacturing and distribution of porous and solid plastic
products. CareInsite, Inc. provides innovative healthcare network and e-commerce
services that leverage Internet technology to enable the confidential exchange
of clinical, administrative and financial information among physicians and their
patients, and affiliated health plans, providers and suppliers. CareInsite is a
69% owned subsidiary of Medical Manager Corporation.
<PAGE>
A report of Medical Manager's financial results for the quarter ended December
31, 1999 is as follows:
<TABLE>
<CAPTION>
MEDICAL MANAGER CORPORATION
SUMMARY FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended Six Months Ended
December 31, December 31,
1999(a) 1998(b) 1999(c) 1998(d)
-------------- --------------- -------------- ------------
<S> <C> <C> <C> <C>
Net revenues:
Medical Manager Health Systems $48,425 $41,941 $96,482 $82,446
Porex 30,006 23,115 59,655 43,661
CareInsite 1,501 - 3,158 -
-------------- --------------- -------------- ------------
79,932 65,056 159,295 126,107
Income/(loss) before interest, taxes, depreciation and
amortization (EBITDA):
Medical Manager Health Systems 9,744 7,496 19,037 15,210
Porex 9,474 8,144 18,909 14,727
CareInsite, before minority interest (12,642) (3,980) (19,707) (5,630)
Corporate and other (1,925) (1,479) (3,656) (2,820)
-------------- --------------- -------------- ------------
4,651 10,181 14,583 21,487
Depreciation and amortization (5,970) (3,370) (11,365) (6,526)
Interest income, net 4,182 2,896 8,879 5,869
Gain on sale of investments, net 24,887 - 24,887 -
Merger and other expenses (450) (4,747) (19,091) (4,747)
Minority interest in CareInsite (3,814) - (1,787) -
-------------- --------------- -------------- ------------
Income before provision for income taxes 23,486 4,960 16,106 16,083
Provision for income taxes 6,041 2,127 8,895 6,576
-------------- --------------- -------------- ------------
Net income $17,445 $2,833 7,211 9,507
============== =============== ============== ============
Income per share - basic $0.50 $0.09 $0.21 $0.29
Income per share - diluted (e) $0.43 $0.08 $0.18 $0.27
Weighted average shares outstanding - basic 35,159 32,761 35,096 32,594
Weighted average shares outstanding - diluted 38,677 35,257 38,724 35,223
</TABLE>
(a) Includes pre-tax charge related to certain litigation with Merck & Co.,
Inc. of $450 and a net gain on the sale of investments of $24,887.
Excluding these items, net income would have been $798 or $0.02 per share
(basic and diluted).
(b) Includes pre-tax charges related to the write-off of capitalized software
of $2,381 and charges related to certain litigation of $2,366. Excluding
these expenses, net income would have been $5,777 or $0.18 (basic) and
$0.16 (diluted).
<PAGE>
(c) Includes pre-tax charge related to certain litigation with Merck & Co.,
Inc. of $1,100 and charges related to the acquisition of Medical Manager
Health Systems of $17,991 and a net gain on the sale of investments of
$24,887. Excluding these items, net income would have been $5,667 or $0.16
per share (basic) and $0.15 (diluted).
(d) Includes pre-tax charges related to the write-off of capitalized software
of $2,381 and charges related to certain litigation of $2,366. Excluding
these expenses, net income would have been $12,451 or $0.38 (basic) and
$0.35 (diluted).
(e) In calculating fully diluted earnings per share for the three and six
months ended December 31, 1999, net income has been adjusted to reflect the
impact of common stock equivalents of our majority-owned subsidiary,
CareInsite.
This press release contains certain forward looking statements relating
to the Company's future operations, dealings with customers and
partners and potential customers and partners, development and
deployment of its products and services, and external transactions.
These statements are based on the Company's current plans and
expectations and involve risks and uncertainties that could cause
actual future activities and results of operations to be different from
those described or implied by such forward looking statements. The
risks and uncertainties of the Company's businesses include, but are
not limited to, product demand and market acceptance risks, the
feasibility of developing and deploying commercially profitable
products and services, the effect of economic conditions, user
acceptance, the impact of competitive products or services, and
pricing, product development, commercialization and technological
difficulties, risks associated with the integration and management of
acquired businesses, and other risks detailed in the Company's
Securities and Exchange Commission filings. Further information about
these matters can be found in the Company's Securities and Exchange
Commission filings. The Company expressly disclaims any intent or
obligation to update these forward looking statements.
