Full year revenues increased to $661,661 an increase of 18% over revenues of $558,642 in the prior fiscal year (based on the storm calculations above, Management estimates, this would have been a 19% increase for the year without the effects of Hurricane Sandy). Net income after taxes for the current year was $42,156 resulting in an EPS of $1.51; this was an increase of 29% from the prior fiscal year pro forma net income after taxes of $32,627, which resulted in an EPS of $1.16 (pro forma for FY2011 excludes the impact of tax refunds and a loss from the sale of an aircraft). The Company reported gross profit on revenues for the 2012 fiscal year of $324,017, resulting in a margin for gross profit on revenues of 49% compared to the prior year same period of $270,789 which resulted in a margin of 48%. The number of patients served increased 16% to 7,801 in the fiscal year from the prior fiscal year total of 6,739. Cash flow from operations for the year was about $53,000, the best ever in the Company’s history.
The Company further noted that its 2011 Stock Repurchase Resolution to buyback up to 1,000,000 shares of its common stock expired on October 31, 2012. Under this plan the Company repurchased 285,450 shares. The Company announced today that its board of directors has approved a new Stock Repurchase Program authorizing the buyback of up to 714,550 shares of its Common Stock in the over-the-counter market at prevailing market prices through October 31, 2013.
Marc D. Grodman, MD, CEO, commented: "Hurricane Sandy wreaked devastation along the eastern coastal states in late October and has had a lasting effect on the lives of many people. It is virtually impossible to discuss our fourth quarter without addressing the effect of the hurricane; however throughout these tumultuous, challenging times, the extraordinary growth of BioReference remains indisputable. This is our 19
year of 20% compound annual growth and, like other years, our growth was wholly organic and across all business units. We are a specialized national laboratory that offers one stop shopping to specialty physicians. We are a full service regional laboratory in the Northeast/Mid-Atlantic region with an impressive menu of managed care contracts. We have outstanding academic associations and cutting edge expertise in the most relevant areas of testing today, including genetics, oncology and Women's Health. This defines us as an enterprise. GeneDx, our genetic sequencing laboratory, has shown strong growth, as strong as any part of BioReference, but the expertise we have gained at GeneDx has had immeasurable value in our other testing areas, such as in oncology and Women's Health. In conjunction with our expertise in Oncology through GenPath, our connectivity solution, CareEvolve, which is being utilized in nearly 200 installations around the country, has enabled us to introduce StormPath. StormPath is an innovative virtual pathology system that allows us to work in partnership with hospital-based pathologists around the country. We are also sequencing solid tumors in a cost effective manner to allow patients to identify their eligibility for clinical trials when the information can be most effective; providing exome sequencing for children who need a diagnosis when all other avenues have been exhausted; delivering unquestioned leadership in Cardiac Genetics. GenPath Women's Health has been successful not because it is built on one test but because we understand that to assume leadership in this area we must offer cutting edge solutions in all clinically relevant areas for all Obstetricians and Gynecologists including Women's cancer, Women's infectious diseases and Pre-Natal genetics."
Dr. Grodman further noted: "There are two issues that I want to specifically address with regard to reimbursement. On November 1, 2012, Medicare (CMS) announced the physician fee schedule that will be in effect for calendar year 2013 for Medicare reimbursement. While there were several adjustments throughout the fee schedule that may affect laboratories, the Company has determined that the effect of the changes to BRLI will not be significant. In particular, while the Company bills CPT Code 88305 in some of its testing procedures, the decrease in the reimbursement for this code will have an overall de minimis effect; based on 2012 billings, the Company's total 88305 billings to Medicare were less than seven tenths of one percent of total billings and the reduction to net income in 2012 based on the 2013 rates would have been just under two tenths of one percent of net income. In addition to the physician fee schedule, CMS has announced that it will be formalizing and setting rates on a little over 100 procedures that fall under the category of molecular diagnostics. The Company has analyzed the molecular pathology codes that will be included in this category and has determined that the overall revenue that it receives for the subject codes is less than 3% of total revenues. Many of the associated codes are already paid under contract or by third party payers and will not be affected by Medicare changes. The Company has always implemented conservative billing policies in seeking reimbursement for these tests and does not expect any significant impact from the reimbursement changes that will probably take effect for these molecular diagnostic tests."