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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): July 22, 1997
OCCUSYSTEMS, INC.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 0-24440 75-2543036
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(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification
incorporation) Number)
3010 LBJ Freeway
Suite 400
Dallas, Texas 75234
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(Address of Principal Executive Offices) (Zip Code)
(972) 484-2700
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(Registrant's Telephone Number, Including Area Code)
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ITEM 5. OTHER EVENTS
See the following press release attached hereto as Exhibit 99.1, dated
July 22, 1997, announcing the Company's second quarter 1997 earnings.
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SIGNATURES
Pursuant to the requirements of the Security and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OCCUSYSTEMS, INC.
By:
Date: July 28, 1997 /s/ John K. Carlyle
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John K. Carlyle
Chairman and Chief Executive Officer
/s/ James M. Greenwood
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James M. Greenwood
Senior Vice President
Chief Financial Officer
(Principal Accounting Officer)
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EXHIBIT 99.1
FOR IMMEDIATELY RELEASE Contact: James M. Greenwood
- ----------------------- Senior Vice President and
Chief Financial Officer
(972) 484-2t00
OCCUSYSTEMS REPORTS 54% INCREASE IN SECOND QUARTER EARNINGS
DALLAS, Texas (July 22, 1997) - Occusystems, Inc. (Nasdaq/NM:OSYS) today
announced continued strong growth in net revenues and earnings for the second
quarter and first half of 1997. The Company's results for the periods were
fueled by higher same-market revenues and margins as well as the addition of new
centers during the past year.
Net revenues for the second quarter rose 22% to $52,665,000 from
$43,246,000 in the second quarter of 1996. Net income increased 54% to
$5,025,000 or $.23 per share compared with $3,266,000 or $.15 per share in the
year-earlier period.
Net revenues for the first half of 1997 rose 21% to $99,048,000 from
$81,577,000 in the year-earlier period. Net income for the first six months of
the year increased 77% to $8,038,000 compared with $4,541,000 last year. On a
per share basis, earnings increased 64% to $.36 versus $.22 last year.
The Company's second quarter and first half 1996 results have been restated
to reflect pooling of interest transactions completed during the past year. Net
revenues and earnings per share for the second quarter of 1997, before
restatement, increased 38% and 35%, respectively; net revenues and earnings per
share for the first half of 1997, before restatement, increased 37% and 44%,
respectively.
"We are pleased with the ongoing momentum we have seen in same center
performance," commented John K. Carlyle, Chairman and Chief Executive Officer.
"Same-market revenues increased 11.0% in the second quarter - at the high end of
our target range of 8% to 12%. Growth in patient visits contributed
approximately two-thirds or 7.1% of the total gain. We achieved similar growth
for the first half of the year as same-market revenues increased 10.5% on 6.5%
higher patient visits. Higher revenue per visit, which increased 3.8% to $73.78
in the first six months of 1997, accounted for the balance of our improvement in
same-market revenues." Carlyle noted that center operating margins on a same-
market basis increased to 27.2% in the second quarter versus 26.3% in the same
period last year. For the first half of 1997, same-market center operating
margins increased to 25.1% from 23.2% in the year-earlier period.
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OSYS Reports Second Quarter Results
Page 2
July 22, 1997
"The Company's acquisition, development and joint venture program also has
contributed significantly to our growth in the first half of 1997," Carlyle
continued. "Over the past year we have added 37 centers to our network,
expanding our presence to eight new markets and increasing by 66 the number of
physicians affiliated with OccuSystems."
Carlyle also announced that OccuSystems recently has completed two
acquisitions that will add strategic capabilities to the Company's product
offering. The first involved the acquisition of EnviroCare Health Services, an
Edison, New Jersey-based occupational medicine clinic that specializes in non-
injury and worksite environmental services. Located in the Raritan Center, the
largest industrial park in the state with 350 employers and a workforce of
13,500 people, EnviroCare will complement the Company's presence in the Newark
area and will expand its capabilities in on-site environmental consulting.
OccuSystems also has acquired Hillman & Associates, Inc., an occupational
healthcare consulting company specializing in feasibility studies, program
assessments and start-up programs for hospitals. Headed by Kathleen Hillman,
Hillman & Associates is expected to aid in the development of new hospital joint
ventures and the identification of management service opportunities through
existing hospital relationships. Terms of the acquisitions were not disclosed.
As announced in April 1997, OccuSystems and CRA Managed Care have agreed to
a merger that will form the nation's first fully integrated managed care company
focused on workers' compensation cost containment. The new company created by
this merger, Concentra/R/ Managed Care, Inc., will provide preventive services,
first report of injury, primary care, specialist networks, specialized cost
containment services, and field case management for worker's compensation as
well as for the disability and automobile injury markets. In the intervening
period since the merger's announcement, the companies have made significant
progress in implementing certain activities, such as joint product marketing on
both a local and national basis, to achieve the operating synergies envisioned
by the merger. The companies note that in May the Federal Trade Commission
granted an early termination to the applicable waiting period under the Hart-
Scott-Rodino Antitrust Improvements Act and that proxy materials related to the
merger are expected to be mailed to shareholders during the week of July 28,
1997. Special meetings of stockholders will be scheduled for late August, and
the merger is expected to close immediately thereafter subject to the approval
by the stockholders of both companies and the satisfaction of other customary
conditions.
Statements contained in this news release that are not based on historical
facts are forward-looking statements, subject to uncertainties and risks,
including, but not limited to, the demand for the Company's products and
services, economic and competitive conditions, the availability of appropriate
acquisition candidates, access to borrowed or equity capital on favorable terms,
and other risks detailed in the Company's Securities and Exchange Commission
filings.
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OSYS Reports Second Quarter Results
Page 3
July 22, 1997
OccuSystems is the nation's largest physician practice management company
focusing on occupational healthcare. OccuSystems provides the management,
facilities, administrative and technical support, case management, physical
therapy services and other ancillary services necessary to establish and
maintain a fully integrated network of occupational healthcare providers.
OccuSystems currently manages the practices of 216 physicians in the Company's
120 occupational healthcare centers located in 32 markets in 16 states.
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<CAPTION>
OCCUSYSTEMS, INC.
UNAUDITED FINANCIAL HIGHLIGHTS
(In thousands, except per share amounts)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
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1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Net revenues $52,665 $43,246 $99,048 $81,577
Earning before interest, taxes,
depreciation and amortization $11,471 $ 7,369 $19,345 $11,589
Net income $ 5,025 $ 3,266 $ 8,038 $ 4,541
Net income per share $ .23 $ .15 $ .36 $ .22
Weighted average shares
outstanding 22,326 22,081 22,321 21,871
</TABLE>
Note: 1996 results have been restated for pooling of interest transactions.
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