The differences between the pro forma financial estimates in the table above and the revised financial estimates below relate to the extent the operating results of the two acquisitions are included in the respective financial estimates. The pro forma financial estimates above include the operating results of the acquisitions for the entire fourth quarter, whereas the revised financial estimates below include the operating results of the acquisitions from the date of acquisition through the end of the quarter (i.e., the month of December for Whitaker and the last 3.5 weeks of December for CyberCoders).
- Revenues of $418 to $422 million
- Gross margin of 30.5 to 30.7 percent
- SG&A (excludes amortization of intangible assets) of $88.0 to $89.0 million (includes $2.5 million in depreciation and $3.9 million in equity-based compensation)
- Amortization of intangible assets of $5.6 million
- Adjusted EBITDA of $45.5 million to $46.5 million
- Effective tax rate of 41.5 percent
- Income from continuing operations of $17.0 to $18.2
- Income from continuing operations of $0.31 to $0.33 per diluted share
- Adjusted income from continuing operations of $0.46 to $0.48 per diluted share
- Diluted shares outstanding of 54.7 million
The pro forma and revised financial estimates also reflect adjustments to the Company’s Q4 2013 financial estimates for its other operating units based on actual results through October and revised estimates for November and December. The current revenue estimate for these units is below our previously announced estimates with no appreciable change in Adjusted EBITDA or income from continuing operations. The downward revision in revenues mainly related to Oxford and was due a number of factors, including, (i) the effects of the loss of Oxford’s largest customer in Q3 (which accounted for $5.9 million in revenues in Q4 of 2012 and $2.6 million in Q3 of 2013), (ii) a higher than expected sequential drop in revenues from Oxford’s Healthcare IT Group as spending on a number of projects have been slowed or delayed until Q1 of 2014, (iii) slower than expected growth in new practices and disciplines and (iv) fewer than expected billing days based on recent client feedback on planned shutdowns over the Christmas and New Year’s holidays.