Air Methods Reports 3Q2013 Results And 4Q2013 Update

DENVER, Nov. 7, 2013 (GLOBE NEWSWIRE) -- Air Methods Corporation (Nasdaq:AIRM) reported results for the quarter ended September 30, 2013. Revenue increased 14% to $252.4 million from $221.3 million in the year-ago quarter. For the nine-month period, revenue increased 4% to $657.8 million, up from $634.6 million in the prior-year nine-month period. For the quarter, net income increased 28% to $35.6 million, or $0.91 per diluted share, as compared with 2012 third quarter net income of $27.8 million, or $0.71 per diluted share. Net income for the nine-month period decreased 32% to $49.1 million, or $1.25 per diluted share, compared to $71.7 million, or $1.84 per diluted share, for the prior-year period. Financial results for the three and nine months ended September 30, 2013 include operations associated with the Company's acquisition of Sundance Helicopters, Inc., a Grand Canyon tour operator (Sundance), on December 31, 2012. Revenue generated by Sundance during the quarter and nine months ended September 30, 2013 was $16.0 million and $42.4 million, respectively.

The current year after-tax quarterly earnings were increased by $0.7 million associated with the cumulative effect of changes in expected blended state income tax rates, compared with a $0.7 million reduction in after-tax earnings in the prior-year quarter for similar changes. Prior year after-tax quarterly earnings were further reduced by $0.6 million associated with a net loss on disposition of assets.  

Third Quarter Highlights

Community-based patient transports were 14,570 during the current-year quarter, compared with 14,829 in the prior-year quarter, a 2% decrease. Patients transported for community bases in operation greater than one year (Same-Base Transports) decreased by 6%, or 854 transports, while weather cancellations for these same bases increased by 436 transports compared with the prior-year quarter. Requests for community-based service decreased 3% for bases open greater than one year. Net revenue per patient transport increased 18% to $12,141, compared with $10,316 in the prior-year quarter. 

Maintenance expense, excluding Sundance, decreased $1.8 million, or 7%, compared with the prior-year quarter, while flight hours decreased by 8%. Excluding Sundance, fuel expense increased by $0.3 million, or 5%, as compared with the prior-year quarter. Fuel expense per flight hour increased 6% over the prior-year quarter. 

For the third quarter, Air Medical Services revenue increased by 8% to $230.8 million compared with $212.8 million in the prior-year quarter, while its segment net income increased by 21% from $52.7 million to $63.6 million. Sundance generated segment net income of $3.8 million on revenue of $16.0 million during the quarter. United Rotorcraft Division's external revenue decreased 33% to $5.6 million compared with $8.4 million in the prior-year quarter, while its external segment net income decreased from $1.7 million in the prior-year quarter to a loss of $0.4 million in the current-year quarter. 

The Company also provided an update on preliminary October 2013 flight volume. Total community-based transports increased 1% to 4,703 during October 2013, compared with 4,674 in October 2013. October 2013 Same-Base Transports decreased by 116 transports, or 3%, while weather cancellations increased by 46 transports compared with October 2012.       

Aaron Todd, CEO, stated, "Our third quarter reflects a return to growth in earnings fueled by strong growth in net revenue per patient transport and more moderate maintenance expenditures as anticipated. Our growth in net revenue per transport reflects more stable year-over-year payer mix and has been realized while reducing our days' sales outstanding, which decreased from 108 days as of September 30, 2012 and 99 days as of June 30, 2013, to 92 days as of September 30, 2013 based on 90-day annualized net revenue. We are also very pleased that our investment in Sundance and the tourism sector continues to generate accretive financial results, in line with our initial expectations."

The Company will discuss these results in a conference call scheduled today at 4:15 p.m. Eastern. Interested parties can access the call by dialing (855) 601-0049 (domestic) or (720) 398-0100 (international) or by accessing the web cast at www.airmethods.com. A replay of the call will be available at (855) 859-2056 (domestic) or (404) 537-3406 (international), access number 94368497, for 3 days following the call and the web cast can be accessed at www.airmethods.com for 30 days.

Air Methods Corporation ( www.airmethods.com) is the global leader in air medical transportation. The Air Medical Services Division is the largest provider of air medical transport services in the United States. The United Rotorcraft Division specializes in the design and manufacture of aeromedical and aerospace technology. The Tourism Division is comprised of Sundance Helicopters, Inc., which provides helicopter tours and charter flights, primarily focusing on Grand Canyon tours. Air Methods' fleet of owned, leased or maintained aircraft features over 400 helicopters and fixed wing aircraft.

Forward Looking Statements: Forward-looking statements in this news release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements in this press release that are "forward-looking statements", including statements regarding the Company's preliminary October 2013 flight volume, anticipated earnings results and anticipated weather and maintenance trends, are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors, including but not limited to, the size, structure and growth of the Company's air medical services and United Rotorcraft Division; the collection rates for patient transports; the continuation and/or renewal of air medical service contracts; the final results of October 2013 flight volume; weather conditions across the U.S.; development and changes in laws and regulations, including, without limitation, the impact of the Patient Protection and Affordable Care Act; increased regulation of the health care and aviation industry through legislative action and revised rules and standards; and other matters set forth in the Company's filings with the SEC. The Company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

Please contact Christine Clarke at (303) 792-7579 to be included on the Company's fax and/or mailing list.

– FINANCIAL STATEMENTS ATTACHED –

AIR METHODS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
(unaudited)
     
     
  September 30, 2013 December 31, 2012
     
     
ASSETS    
     
Current assets:    
Cash and cash equivalents  $ 19,159  3,818
Trade receivables, net 236,560  232,929
Other current assets 76,231  70,058
     
Total current assets 331,950  306,805
     
Net property and equipment 611,480  597,238
Other assets, net 216,290  214,820
     
Total assets  $ 1,159,720  1,118,863
     
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
     
Current liabilities:    
Notes payable related to assets held for sale  $ 0  3,570
Current portion of indebtedness 63,305  63,139
Accounts payable, accrued expenses and other 79,321  76,743
     
Total current liabilities 142,626  143,452
     
Long-term indebtedness 563,794  581,019
Other non-current liabilities 98,266  94,782
     
Total liabilities 804,686  819,253
     
Total stockholders' equity 355,034  299,610
     
Total liabilities and stockholders' equity  $ 1,159,720  1,118,863
 
AIR METHODS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except share and per share amounts)
(unaudited)
         
  Three Months Ended September 30, Nine Months Ended September 30,
         
  2013 2012 2013 2012
         
Revenue:        
Flight operations  $ 227,543  211,109  593,311  606,719
Product operations  5,616  8,490  15,026  23,238
Tourism operations  16,002  --   42,385  -- 
Other  3,224  1,691  7,097  4,627
Total revenue  252,385  221,290  657,819  634,584
         
Expenses:        
Operating expenses  139,527  124,961  415,880  365,918
General and administrative  30,448  23,478  87,738  73,902
Loss on disposition of assets, net  118  985  326  774
Depreciation and amortization  19,781  20,638  59,790  62,460
   189,874  170,062  563,734  503,054
         
Operating income  62,511  51,228  94,085  131,530
         
Interest expense  (5,190)  (5,022)  (15,169)  (15,887)
Other, net  349  711  964  2,639
         
Income before income taxes  57,670  46,917  79,880  118,282
         
Income tax expense  (22,065)  (19,073)  (30,815)  (46,551)
         
Net income  $ 35,605  27,844  49,065  71,731
         
Income per common share:        
Basic  $ 0.91 0.72 1.26 1.86
Diluted  $ 0.91 0.71 1.25 1.84
         
Weighted average common shares outstanding:        
Basic 38,933,915 38,690,436  38,882,943  38,551,587
Diluted 39,194,532 39,050,247  39,228,113  38,969,937
CONTACT: Trent J. Carman, Chief Financial Officer, (303) 792-7591

Air Methods Corporation