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Digirad Corporation Reports First Quarter Financial Results

Stocks in this article: DRAD

Year Over Year Revenues Increase 13%

Announces Cash Dividend of $0.05 Cents Per Share

SUWANEE, Ga., May 1, 2014 (GLOBE NEWSWIRE) -- Digirad Corporation (Nasdaq:DRAD) today reported total revenues for the first quarter 2014 of $13.0 million, an increase of 13 percent compared to the prior year's first quarter. The GAAP loss for the 2014 first quarter, which included $0.4 million of one-time lease termination charges and approximately $0.2 million in transaction costs related to the purchase of Telerhythmics, was $0.1 million, or $0.01 per diluted share. Included within the results are the operations of Telerhythmics, LLC, which contributed approximately $255,000 to total revenue since being acquired by Digirad on March 13, 2014.

The Company also announced a cash dividend of $0.05 per share that will be paid on May 27, 2014, to shareholders of record on May 13, 2014.

Adjusted EBITDA, a non-GAAP measure of operating performance, for the first quarter of 2014 was $0.8 million, compared to an adjusted EBITDA loss of $0.8 million for the same period of the prior year. During the quarter, the Company took a restructuring charge of $0.4 million related to its previously announced lease termination in Poway, California, to move to a much smaller alternative facility to house its ongoing camera and camera support operations. The change in facilities is expected to save between $400,000 and $500,000 annually once the transition is complete. A reconciliation of adjusted EBITDA to net income (loss) is provided later in this release.

Digirad President and CEO Matt Molchan said, "Revenues in the 2014 first quarter increased year over year despite the impact of the challenging weather conditions up and down the East Coast, primarily in January and February. Still, we generated a year-over-year increase in Diagnostic Services revenue of 4%, not including the impact of Telerhythmics. Excluding the lease termination costs and the Telerhythmics transaction costs, this year's first quarter would have been profitable. The first quarter of the year is historically our lowest revenue and profitability quarter for our services business, which was expected notwithstanding the challenging weather. We expect our Diagnostic Services business to have positive earnings contributions over the remaining portion of the year. Our Diagnostic Imaging business was not as impacted by weather conditions, and it had a great quarter, selling several good margin systems."

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