<PAGE>
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
CRA MANAGED CARE, INC.
(Exact name of registrant as specified in its charter)
Massachusetts 02-25856 004-2658593
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
organization)
312 Union Wharf, Boston, Massachusetts 02109
(Address of principal executive offices)
Registrant's telephone number, including area code: (617) 367-2163
N/A
(Former name or former address, if changed since last report)
Exhibit Index located at Page 2
<PAGE>
ITEM 5. OTHER EVENTS.
On July 22, 1997, CRA Managed Care, Inc. (the "Registrant")
released the press release attached as Exhibit 99.1 hereto, which press
release is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements. None.
(b) Pro Forma Financial Information. None.
(c) Exhibits - The following Exhibit to this Form 8-K is
hereby filed:
Exhibit 99.1 Press Release dated July 22, 1997
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 hereunto duly authorized.
CRA MANAGED CARE, INC.
July 28, 1997 /s/ Donald J. Larson
-----------------------------
By: Donald J. Larson
President and Chief Executive Officer
-2-
<PAGE>
Exhibit 99.1
FOR IMMEDIATE RELEASE
Contacts: Joseph F. Pesce, CFO Jon Siegal, Associate
CRA Managed Care, Inc. Ronald Trahan Associates, Inc.
617-367-2163, Ext. 142 617-332-0101, Ext. 15
CRA Managed Care, Inc. announces
second-quarter 1997 financial results
Revenues up 37%; operating income increases 45%; net income rises
41% over the second quarter last year
BOSTON, July 22, 1997 -- CRA Managed Care, Inc. (NASDAQ: CRAA) today
announced that revenues for the second quarter ended June 30, 1997, increased
37 percent to $61.1 million, compared with revenues of $44.8 million during
the three months ended June 30, 1996. Operating income for the three months
ended June 30, 1997, increased 45 percent to $6.3 million, compared with $4.4
million for the same period last year.
Net income for the three months ended June 30, 1997, increased 41 percent to
$3.3 million, or $0.37 per share, compared with $2.4 million, or $0.29 per
share, for the same period last year.
For the six months ended June 30, 1997, revenues increased 36 percent to
$115.6 million, compared with revenues of $85.0 million for the same period
last year. In addition, operating income increased 49 percent to $12.0
million, compared with $8.1 million, also for the same period last year. Net
income increased 46 percent to $6.4 million, or $0.71 per share, compared
with $4.4 million, or $0.56 per share, for the six months ended June 30, 1996.
"We were extremely pleased to see strong growth across the board for our
highly diversified mix of managed care services," said Donald J. Larson,
president and chief executive officer of CRA Managed Care. "We continue to
benefit from two important trends in our industry: the transformation of
workers' compensation to a managed care delivery system, and the increasing
interest of a variety of payors in outsourcing this critically important
function."
As announced in April 1997, CRA and OccuSystems Inc. 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 Managed Care Inc., will provide preventive
services, first report of injury, primary care, specialist networks,
specialized cost containment services and field case management for workers'
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. more...
<PAGE>
CRA/2
CRA Managed Care provides services designed to reduce the costs associated
with workers' compensation, automobile and disability insurance claims. The
Company operates one of the largest field case-management organizations in
North America, consisting of 122 field case management offices with
approximately 1,225 field case managers who provide medical management and
return-to-work services in 49 states, the District of Columbia and Canada.
The Company also owns FOCUS Healthcare Management Inc., one of the country's
largest specialized PPOs focused on the workers' compensation and automobile
liability marketplaces; as well as Prompt Associates Inc., a leading provider
of both inpatient and outpatient bill review services to the healthcare
marketplace for claims that fall outside of a payor's network of hospitals or
outpatient facilities. Additionally, CRA provides a broad range of
specialized cost containment services from 83 service locations -- including
utilization management, telephonic case management and retrospective medical
bill review services -- that are designed to reduce costs associated with
work- and auto-related injuries.
This press release contains certain forwrard-looking statements, which the
Company is making in reliance on the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Investors are cautioned that all
forward-looking statements involve risks and uncertainties, and that the
Company's actual results may differ materially from the results discussed in
the forward-looking statements. Factors that could cause or contribute to
such differences include, but are not limited to, the potential adverse
impact of governmental regulation on the Compoany's operations, an
interruption in its data processing capabilities, operational, financing and
strategic risks related to the Company's growth strategy, possible quarterly
and annual fluctuations in its operating results, litigation against the
Company, possible legal liability for adverse medical consequences,
competitive pressures, adverse changes in market conditions for the Company's
services, and the dependence of the Company on key management personnel.
Additional factors include those described in the Company's Form 10-K filed
with the SEC on March 31, 1997 (SEC File No. 02-25856).
# # #
Copyright-C- 1997 by CRA Managed Care, Inc. All rights reserved.
Financial Tables Follow...
<PAGE>
Statement of Operations
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
------------------- -----------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES............................. $61,130,000 $44,759,000 $115,619,000 $84,984,000
COST OF SERVICES..................... 49,876,000 36,747,000 94,447,000 70,169,000
----------- ----------- ------------ -----------
GROSS PROFIT.................... 11,254,000 8,012,000 21,172,000 14,815,000
GENERAL & ADMIN EXPENSES............. 4,922,000 3,636,000 9,173,000 6,745,000
----------- ------------ ------------ -----------
OPERATING INCOME................ 6,332,000 4,376,000 11,999,000 8,070,000
INTEREST EXPENSE, NET................ 357,000 331,000 497,000 525,000
----------- ----------- ------------- -----------
INCOME BEFORE INCOME TAXES...... 5,975,000 4,045,000 11,502,000 7,545,000
PROVISION FOR INCOME TAXES........... 2,629,000 1,678,000 5,061,000 3,131,000
----------- ----------- ------------- -----------
NET INCOME........................... $ 3,346,000 $ 2,367,000 $ 6,441,000 $ 4,414,000
----------- ----------- ------------- -----------
----------- ----------- ------------- -----------
EARNINGS PER SHARE:.................. $0.37 $0.29 $0.71 $0.56
----- ----- ----- -----
----- ----- ----- -----
WEIGHTED AVERAGE SHARES
OUTSTANDING........................ 9,081,000 8,150,000 9,092,000 7,850,000
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
</TABLE>
Consolidated Balance Sheets
(unaudited)
<TABLE>
<CAPTION>
June 30 December 31
1997 1996
------- -----------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents........ $ - $ 2,596,000
Accounts receivable, net......... 49,340,000 36,446,000
Prepaid expenses and prepaid
taxes.......................... 904,000 1,012,000
------------ ------------
Total current assets........ 50,244,000 40,054,000
PROPERTY AND EQUIPMENT, NET........... 15,392,000 8,890,000
GOODWILL, NET......................... 85,045,000 48,788,000
OTHER ASSETS.......................... 242,000 396,000
------------ ------------
TOTAL ASSETS.......................... $150,923,000 $ 98,128,000
------------ ------------
------------ ------------
CURRENT LIABILITIES:
Revolving credit facilities...... $ 45,678,000 $ 5,700,000
Current portion of long-term
debt........................... 24,000 56,000
Accounts payable and accrued
expenses....................... 19,385,000 14,953,000
------------ -------------
Total current liabilities... 65,087,000 20,709,000
LONG-TERM DEFERRED TAX LIABILITIES.... 841,000 841,000
STOCKHOLDERS' EQUITY.................. 84,995,000 76,578,000
------------ -------------
TOTAL LIABILITIES AND EQUITY.......... $150,923,000 $ 98,128,000
------------ -------------
------------ -------------
</TABLE>
