CardioNet, Inc. (NASDAQ:BEAT), a leading wireless medical technology company with a current focus on the diagnosis and monitoring of cardiac arrhythmias, today reported results for the third quarter ended September 30, 2011.
Third Quarter 2011 and Recent Highlights
President and CEO Commentary
- Achieved positive adjusted EBITDA year to date
- Biotel contributed positive EBITDA and is on track to exceed our expectations
- Improved GAAP and adjusted operating loss as a percentage of revenue compared to prior year due to efficiency and cost-saving initiatives
- Secured 13 new payor contracts during the quarter
- Appointed existing Director Kirk Gorman as Chairman of the Board; replaces Randy Thurman following successful completion of transition plan
- Launching next-generation MCOT TM device during fourth quarter 2011
- $43 million in cash and investments as of September 30, 2011, with no outstanding debt
Joseph Capper, President and Chief Executive Officer of CardioNet, commented: “During the third quarter, we advanced on our strategic initiatives and positioned the Company for long-term success. We added 13 new payor contracts and maintained a strong presence in the physicians’ office by offering an entire suite of cardiac monitoring tools. We spent significant time and money in the quarter evaluating ongoing strategic opportunities. We expect a limited market release of our next generation MCOT
in the fourth quarter, which will assist in reducing our overall cost structure. To further reduce costs in response to a down market, we have identified and will eliminate another $5 to $7 million of expenses. Year-to-date, we have generated positive adjusted EBITDA and have $43 million in cash and investments with no debt. This positions us to capitalize on opportunities to drive future growth and profitability.
“Despite the many examples of operational progress during the third quarter, our financial results were impacted by a decline in overall patient volume, coupled with continued pressure on reimbursement. We believe our results are reflective of the overall macro-economic environment, which includes declines in physician office visits compared to the prior year and a drop-off in the U.S. Consumer Confidence Index, which fell to its lowest level in over two years. While the current environment has been challenging, we believe the long-term prospects for MCOT
are strong given the growing awareness of the risks associated with atrial fibrillation.”
Third Quarter Financial Results
Revenue for the third quarter 2011 was $26.6 million, a decrease of 3.2% compared to $27.5 million in the third quarter 2010. The decrease in revenue was primarily due to lower patient volume, which we believe is as a result of an overall decline in physician office visits compared to prior year. This decrease was partially offset by the addition of Biotel revenue. For the three months ended September 30, 2011, patient revenue was comprised of 39% Medicare and 61% commercial, and patient volume was comprised of 51% Medicare and 49% commercial.