13-Aug-2014 Source: Air Methods
Air Methods Corporation (Nasdaq:AIRM), the global leader in air medical transportation, reported financial results for the quarter ended June 30, 2014 and provided an update on July 2014 patient transports. For the quarter, revenue increased 14% from $226.2 million to $258.5 million from the prior year quarter. For the six-month period, revenue increased 19% to $481.6 million, compared with $405.4 million in the prior-year six-month period. Financial results for the three and six months ended June 30, 2014 include operations associated with the Company’s acquisition of Helicopters Consultants of Maui, LLC (doing business as Blue Hawaiian Helicopters) and certain of its affiliates (collectively, Blue Hawaiian), which was acquired by the Company on December 13, 2013. Revenue generated from Blue Hawaiian during the quarter and six months ended June 30, 2014 was $14.0 million and $27.5 million, respectively.
For the quarter, net income increased 50% to $28.8 million, or $0.73 per diluted share, as compared with prior-year second quarter net income of $19.1 million, or $0.49 per diluted share. Net income for the six-month period increased 195% to $39.7 million, or $1.01 per diluted share, compared to $13.5 million, or $0.34 per diluted share, for the prior-year six-month period. The prior-year second quarter and six-month results included pre-tax hull & liability insurance retention expenses of $2.0 million associated with claims incurred during the second quarter of 2013. The current-year second quarter and six-month results include a profit commission of $1.1 million associated with significantly reduced hull and liability insurance claims during the most recent plan year. The current year second quarter and six-month period include net losses on disposition of assets of $0.8 million and $1.2 million, respectively. This compares with the prior-year quarter net gain of $0.2 million and prior-year six-month net loss of $0.2 million. Net cash provided by operating activities increased by $22.7 million during the six months ended June 30, 2014, compared with the prior-year period. This increase is consistent with increase in net income of $26.2 million during the same comparative periods.
Patient transports were 14,994 during the current-year quarter, compared with 13,984 in the prior-year quarter, a 7% increase. Patients transported for community bases in operation greater than one year (Same-Base Transports) increased by 3%, or 333 transports, while weather cancellations for these same bases decreased by 333 transports compared with the prior-year quarter. Requests for community-based service increased 4% for bases open greater than one year. Net revenue per patient transport increased 7% to $11,353, compared with $10,650 in the prior-year quarter.
Maintenance expense, excluding tourism operations, decreased $4.7 million, or 17%, compared with the prior-year quarter, while flight hours decreased by 7%. Excluding tourism operations, fuel expense per hour flown decreased by 4%.
For the second quarter, Air Medical Services revenue increased by 7% to $219.6 million compared with $205.2 million in the prior-year quarter, while its segment net income increased by 37% from $39.4 million to $54.1 million. Tourism operations generated segment net income of $4.7 million on revenue of $31.4 million during the quarter, compared with prior-year second quarter segment net income and revenue of $1.1 million and $16.0 million, respectively. United Rotorcraft Division’s external revenue increased 51% to $7.4 million compared with $4.9 million in the prior-year quarter, while its external segment net income remained essentially unchanged at breakeven.
The Company also provided an update on preliminary July 2014 flight volume. Total community-based transports increased 13% to 5,489 during July 2014, compared with 4,838 in July 2013. July 2014 Same-Base Transports increased by 158 transports, or 3%, while weather cancellations decreased by 546 transports compared with July 2013.
Aaron Todd, CEO, stated, “During our second quarter, we continued to experience strong growth in both revenue and earnings. Increase in community-based operating locations and average flight volumes, more moderate weather and maintenance expenditures, dividends from safe flight operations, and accretive results from recent diversification into helicopter tourism have all contributed to this success. The 13% growth in July community-based patient flight volumes reflects a strong start to the third quarter as well. We also anticipate continued growth in net revenue per transport based on improving payer mix trends experienced in recent months, compared with earlier winter months. We feel these factors justify our continued optimism for the second half of 2014.”
Full financial statements can be seen here