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Athenahealth, Inc. Reports Second Quarter Fiscal Year 2013 Results

Stocks in this article: ATHN

Q2 2013 Financial Results

  • 41% Revenue Growth Over Second Quarter of 2012
  • Non-GAAP Adjusted Operating Income of $11.2 million
  • GAAP Tax Provision of $7.3 million
  • GAAP Net Loss of $12.4 million or $0.34 Per Diluted Share
  • Non-GAAP Adjusted Net Loss of $3.1 million, or $0.08 Per Diluted Share

WATERTOWN, Mass., July 18, 2013 (GLOBE NEWSWIRE) -- athenahealth, Inc. (Nasdaq:ATHN) (the "Company," "we," or "athenahealth"), a leading provider of cloud-based electronic health record ( EHR), practice management, and care coordination services to medical groups and health systems, today announced financial and operational results for the second quarter of fiscal year 2013. The Company will conduct a conference call tomorrow July 19, 2013, at 8:00 a.m. Eastern Time to discuss these results and management's outlook for future financial and operational performance.

  • Total revenue for the three months ended June 30, 2013, was $146.3 million, compared to $103.5 million in the same period last year, an increase of 41%.
  • Excluding the Epocrates revenue of $14.6 million and other revenue consisting of third-party tenant revenue of $2.2 million, core athenahealth revenue was $129.5 million, an increase of 25% over Q2 2012.
  • For the three months ended June 30, 2013, GAAP Net Loss was $12.4 million, or $0.34 per diluted share, compared to GAAP Net Income of $4.2 million, or $0.11 per diluted share, in the same period last year.  
  • For the three months ended June 30, 2013, Non-GAAP Adjusted Net Loss was $3.1 million, or $0.08 per diluted share, down from Non-GAAP Adjusted Net Income of $9.0 million, or $0.24 per diluted share, in the same period last year.
  • Non-GAAP Adjusted Net Loss per Diluted Share of $0.08 was impacted by a $7.3 million GAAP tax provision as the significant GAAP tax benefit we recorded for the three months ended March 31, 2013 started to reverse during the three months ended June 30, 2013.  
  • We expect our full year 2013 Non-GAAP tax provision will be approximately 43% and our cash taxes paid to be approximately $2 million.

"The fruits of our labor are showing. This past quarter we delivered meaningful achievements that are immensely important to the future of our business. We added Ascension Health - the largest non-profit health system in the country - to our client list. This milestone shows that the values of the cloud are universal across provider groups of all sizes," said Jonathan Bush, the Company's Chairman and Chief Executive Officer. "Likewise, athenaClinicals was recognized as the 'most usable' EHR in the ambulatory space and our work with Epocrates moves forward, setting the future of our mobile vision. Finally, we keep growing, not only across the network, but across the various locations from which our teams work."

  • For the three months ended June 30, 2013, Non-GAAP Adjusted Gross Margin was 62.4%, down from 62.6% in the same period last year, as the Company continues to invest in its service offerings.  
  • For the three months ended June 30, 2013, Non-GAAP Adjusted Operating Income of $11.2 million, or 7.6% of total revenue, decreased 25% from Non-GAAP Adjusted Operating Income of $14.8 million, or 14.3% of total revenue, in the same period last year. This decrease reflects our continued investment in growth and innovation and depreciation related to our capital expenditure investments. 
  • Non-GAAP Adjusted Operating Income excludes $2.5 million of integration and transaction costs relating to the acquisition of Epocrates, Inc. which closed on March 12, 2013, and the purchase of the Arsenal on the Charles campus in Watertown, Massachusetts which closed on May 10, 2013.  
  • Non-GAAP Adjusted Operating Income also excludes a $2.5 million gain relating to the early termination of the Arsenal lease.
  • As of June 30, 2013, the Company had cash and cash equivalents of $33.6 million and outstanding indebtedness of $246.3 million.

"Halfway through the year, we are tracking well against our corporate scorecard which includes value-driving financial and operational metrics," said Tim Adams, the Company's Chief Financial Officer. "While Q2 2013 GAAP Total Revenue and Non-GAAP Adjusted Net Income per Diluted Share came in modestly below our plan, we are very pleased the quarter was highlighted by record physicians adds, the signing of the largest deal in our company's history and continued progress consolidating the Epocrates and Arsenal acquisitions."

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