Air Methods reports FY11Q1 results and Q2 update

Air Methods reports FY11Q1 results and Q2 update

5-May-2011 Source: Air Methods

Air Methods Corporation (Nasdaq:AIRM), the largest air medical transportation company in the world, reported financial results for the quarter ended March 31, 2011 and provided an update on April 2011 flight volume. For the quarter, revenue increased 11% to $131.9 million from $118.5 million in the prior-year quarter. Net income for the first quarter of 2011 was $6.0 million, or $0.47 per diluted share, compared with net income of $0.1 million, or $0.01 per diluted share, in the first quarter of 2010. The current-year quarter includes a pre-tax, non-cash gain of $1.0 million for the mark to market of a fuel derivative, compared with a pre-tax, non-cash loss of $0.2 million in the prior-year quarter.

Community-based patient transports were 8,875 during the current-year quarter, compared with 8,592 in the prior-year quarter, a 3% increase. Patients transported for community bases in operation greater than one year (Same-Base Transports) decreased by 1% or 114 transports, while weather cancellations for these same bases increased by 324 transports compared with the prior-year quarter. Requests for community-based service increased 3% for bases open greater than one year. Net revenue per community-based transport increased 16% from $7,621 to $8,837 in the current-year quarter reflecting current and prior-year price increases.

Maintenance expense decreased $0.6 million or 3% compared with the prior-year quarter, despite a 3% increase in flight hours. This improvement was attributed to benefit of fleet replacement activities and lower costs associated with major aircraft component overhauls or replacements. Fuel expense decreased by $0.4 million to $2.5 million compared with the prior-year quarter, reflecting a 13% decrease per hour flown due to fuel derivative gains and cash settlements.

For the first quarter, community-based divisional revenue increased 20% to $80.0 million, compared to $66.7 million in the prior year, while segment net income increased to $10.5 million from $0.9 million. Hospital-based divisional revenue decreased 4% to $46.1 million from $48.0 million in the prior-year period, while segment net income increased 3% to $4.1 million compared with $4.0 million in the prior-year quarter. Decrease in hospital-based divisional revenue was partially attributed to the conversion of three contracts to a community-based service subsequent to the first quarter of 2010. Products Division’s external revenue increased 49% to $5.8 million compared with $3.9 million in the prior-year quarter, while its external segment net income increased by $1.5 million as compared with the prior-year quarter.

The Company also provided an update on preliminary April 2011 flight volume. Total community-based transports were 3,205 during April 2011 compared with 3,478 in April 2010. April 2011 Same-Base Transports decreased by 411 transports, or 12%, as compared with April 2010. Weather cancellations during April 2011 for these same bases increased by 411 compared with the prior-year month.

Aaron Todd, CEO, stated, “We are pleased with the strong start to our 2011 fiscal year, despite higher weather cancellations experienced within our flight operations. We are especially encouraged by the increase in requests for service for community-bases open greater than one year. Although weather was very severe in April 2011 compared with April 2010, weather cancellations in April 2010 were the second fewest of the entire year and were by far the fewest for the second quarter of 2010. We are also pleased to have experienced moderation in our maintenance expenditures, following higher than anticipated maintenance expense experienced during the previous year.”

The Company will discuss these results in a conference call scheduled today at 4:15 p.m. Eastern. Interested parties can access the call by dialing (877) 883-0656 (domestic) or (706) 643-8826 (international), or by accessing the web cast at www.airmethods.com. A replay of the call will be available at (800) 642-1687 (domestic) or (706) 645-9291 (international), access number 63074081, for 3 days following the call, and the web cast can be accessed at www.airmethods.com for 30 days.

Air Methods Corporation (www.airmethods.com) is a leader in emergency air medical transportation and medical services. The Hospital Based Services Division is the largest provider of air medical transport services for hospitals. The Community Based Services Division is one of the largest community-based providers of air medical services. The Products Division specializes in the design and manufacture of aeromedical and aerospace technology. The Company’s fleet of owned, leased or maintained aircraft features over 300 helicopters and fixed wing aircraft.

The Air Methods Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6955.

Forward-Looking Statements: This news release includes certain forward-looking statements, which are subject to various risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors, including but not limited to, the size, structure and growth of the Company’s air medical services and products markets; the collection rates for patient transports; the continuation and/or renewal of air medical service contracts; the acquisition of profitable Products Division contracts and other flight service operations; the successful expansion of the community-based operations; and other matters set forth in the Company’s public filings.

Please contact Christine Clarke at (303) 792-7579 to be included on the Company’s fax and/or mailing list.

        AIR METHODS CORPORATION AND SUBSIDIARIES
     UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
                 (Amounts in thousands)

                                   March 31,  December
                                     2011     31, 2010
                                  ----------  --------

  ASSETS
  ------------------------------

  Current assets:
  Cash and cash equivalents         $ 56,412    60,710
  Trade receivables, net             128,342   132,329

  Other current assets                51,991    45,034
                                  ----------  --------

  Total current assets               236,745   238,073

  Net property and equipment         210,600   200,875

  Other assets, net                   38,562    35,731
                                  ----------  --------

  Total assets                     $ 485,907   474,679
                                  ==========  ========

  LIABILITIES AND STOCKHOLDERS'
   EQUITY
  ------------------------------

  Current liabilities:
  Notes payable related to
   assets held for sale              $ 6,714        --
  Current portion of
   indebtedness                       15,611    15,835
  Accounts payable, accrued
   expenses and other                 59,922    58,217
                                  ----------  --------

  Total current liabilities           82,247    74,052

  Long-term indebtedness              77,551    81,305

  Other non-current liabilities       72,184    73,566
                                  ----------  --------

  Total liabilities                  231,982   228,923

  Total stockholders' equity         253,925   245,756
                                  ----------  --------

  Total liabilities and
   stockholders' equity            $ 485,907   474,679
                                  ==========  ========
     AIR METHODS CORPORATION AND SUBSIDIARIES
   UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
                       INCOME
    (Amounts in thousands, except share and per
                   share amounts)

                                Quarter Ended
                                  March 31,
                           ----------------------

                              2011        2010
                           ----------  ----------

  Revenue:
  Flight operations         $ 124,521     113,279
  Product operations            5,801       3,905

  Other                         1,583       1,318
                           ----------  ----------

  Total revenue               131,905     118,502
                           ----------  ----------

  Expenses:
  Operating expenses           95,866      95,391
  General and
   administrative              18,307      15,935
  Depreciation and
   amortization                 6,709       5,595
                           ----------  ----------

                              120,882     116,921
                           ----------  ----------

  Operating income             11,023       1,581

  Interest expense            (1,328)     (1,461)

  Other, net                      180          46
                           ----------  ----------

  Income before income
   taxes                        9,875         166

  Income tax expense          (3,889)        (63)
                           ----------  ----------

  Net income                  $ 5,986         103
                           ==========  ==========

  Income per common
   share:
    Basic                      $ 0.47        0.01
    Diluted                    $ 0.47        0.01

  Weighted average common
   shares outstanding -
   basic                   12,607,522  12,459,592
  Weighted average common
   shares outstanding -
   diluted                 12,758,669  12,529,664

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