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) April 22, 1997
MEDCATH INCORPORATED
(Exact name of registrant
as specified in its charter)
North Carolina 0-25176 56-1635096
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
7621 Little Avenue, Suite 106, Charlotte, North Carolina 28226
(Address of principal executive offices)
Registrant's telephone number, including area code (704) 541-3228
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Item 5. Other Events
On April 22, 1997 MedCath Incorporated announced financial results for the
second quarter and six months ended March 31, 1997. Highlights included second
quarter EPS of $0.18, record net revenue and net income and the opening of the
Arkansas Heart Hospital in Little Rock, Arkansas.
Exhibits:
99.1 - Press Release dated April 22, 1997
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
MEDCATH INCORPORATED
Date: April 30, 1997 By: /s/ Richard J. Post
------------------------------
Richard J. Post
Chief Financial Officer,
Secretary and Treasurer
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Exhibit 99.1
MEDCATH INCORPORATED ANNOUNCES
SECOND QUARTER RESULTS
Second Quarter Highlights:
Second quarter EPS of $0.18 with record net revenue and net income
Arkansas Heart Hospital receives Medicare certification and opened on
March 3
McAllen Heart Hospital signed 13 agreements to date with Preferred
Provider Organizations (PPOs) which cover over 200,000 lives; Arkansas
Heart Hospital signed four agreements with PPOs covering over 235,000
lives
Financing commitment obtained for the Arizona Heart Hospital
Charlotte, North Carolina (April 22, 1997) -- MedCath Incorporated
(Nasdaq/NM:MCTH) today announced financial results for the second quarter ended
March 31, 1997.
Net revenue for the second quarter ended March 31, 1997, increased 55%
to $26.7 million compared with $17.3 million for the same period in 1996. Net
income for the second quarter ended March 31, 1997, increased 61% to $2.1
million compared with $1.3 million for the same period in 1996. Net income per
share for the second quarter ended March 31, 1997, increased to $0.18 on 11.7
million shares compared with $0.14 on 9.1 million shares for the same period in
1996.
For the six months ended March 31, 1997, net revenue increased 74% to
$49.6 million compared with $28.5 million for the same period in 1996. Net
income for the six months ended March 31, 1996, increased 52% to $3.9 million
compared with $2.5 million for the same period in 1996. Net income per share for
the six months ended March 31, 1996, increased to $0.33 per share on 11.7
million shares compared with $0.28 per share on 9.1 million shares for the same
period in 1996.
Stephen R. Puckett, president of MedCath said, "We are very pleased
with our strong financial performance, which reached record levels during the
quarter. Profitability for the McAllen Heart Hospital in McAllen, Texas,
exceeded levels achieved in the first quarter, and we continued to achieve what
we believe is a dominant cardiac market share. To date, the McAllen Hospital has
signed 13 agreements with Preferred Provider Organizations (PPOs) which cover
over 200,000 lives.
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"In addition, we are very pleased with the early operating results at
Arkansas Heart Hospital, which opened ahead of schedule. The Arkansas Department
of Health completed its inspection of the hospital on March 3, 1997, and all
conditions of compliance regarding Medicare regulations were met without
exception. Thus far, the Arkansas Heart Hospital has signed four agreements with
PPOs which cover over 235,000 lives. We are very excited about the PPO contracts
signed by our two heart hospitals and feel that this further validates our
strategy of providing low cost, high quality cardiac care.
"In March, we obtained a commitment from NationsBank, Charlotte, North
Carolina, to provide financing for the land acquisition and construction of the
Arizona Heart Hospital. We are excited to have established this relationship as
it should provide us with more favorable terms and greater flexibility to
finance our heart hospitals. We expect to complete the transaction in the third
quarter."
In closing, Mr. Puckett said, "We are pleased with the results we have
achieved in the first half of our fiscal year. Including the Arizona Heart
Hospital in Phoenix, Arizona, which we announced in January 1997, we now have
two heart hospitals in operation and four in various stages of development. We
are dramatically expanding our base of knowledge as a result of opening and
operating these facilities, and as we learn, we improve. In addition, our
optimistic outlook for the remainder of our fiscal year is supported by the
strong contributions of MedCath's Practice Management Division and Diagnostics
Division. These two divisions are both profitable, generate strong cash flow,
and support, in large measure, the ongoing development efforts of our heart
hospital strategy."
Statements contained in this press release which are not historical
facts may be considered forward-looking statements as that term is defined in
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to risks and uncertainties which could cause actual
results to differ materially from those projected. Such risks and uncertainties
include construction and development risks associated with heart hospitals;
operating losses and negative cash flows during the initial operation of heart
hospitals; dependence on physician relationships; dependence on long-term
management contracts; fluctuations in quarterly operating results from
seasonality, population shifts and other factors; dependence on key management;
as well as other risks detailed in the Company's filings with the Securities and
Exchange Commission.
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MedCath Incorporated is a provider of cardiology and cardiovascular
services through the operation of specialized facilities and the management of
physician practices. The Company operates two specialty heart hospitals and has
four additional heart hospitals under development, manages three medical
practices comprised of a total of 76 physicians, manages fixed-site cardiac
diagnostic and therapeutic centers, and owns and operates mobile cardiac
catheterization laboratories serving networks of hospitals.
<TABLE>
<CAPTION>
MEDCATH INCORPORATED
Financial Highlights
Three Months Ended Six Months Ended
March 31, March 31,
--------------------------------------------------------------------
1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net revenue $ 26,709,491 $ 17,283,929 $ 49,563,944 $ 28,492,562
Operating expenses (22,805,218) (14,630,488) (42,138,464) (23,476,100)
------------ ------------- ----------- -----------
Income from operations 3,904,273 2,653,441 7,425,480 5,016,462
Income before income taxes 3,381,765 2,170,721 6,305,525 4,214,338
Provision for income taxes (1,284,454) (868,288) (2,453,958) (1,685,735)
------------ ------------ ------------ -----------
Net income $ 2,097,311 $ 1,302,433 $ 3,851,567 $ 2,528,603
====================================================================
Net income per common and
common equivalent share $ 0.18 $ 0.14 $ 0.33 $ 0.28
====================================================================
Weighted average number
of shares outstanding 11,664,220 9,132,538 11,666,776 9,061,070
====================================================================
</TABLE>
<TABLE>
<CAPTION>
March 31, September 30,
1997 1996
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash and short-term investments $ 48,444,195 $ 61,693,549
Working capital $ 57,138,224 $ 65,809,625
Total assets $ 224,381,120 $ 181,920,718
Long-term debt and capital leases, excluding current maturities $ 76,334,370 $ 45,895,438
Shareholders' equity $ 124,186,657 $ 120,245,093
</TABLE>
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