ELMSFORD, N.Y., March 2, 2015 /PRNewswire/ -- BioScrip®, Inc. (NASDAQ: BIOS) (the “Company”) today announced 2014 fourth quarter financial results. Fourth quarter revenue from continuing operations was $253.7 million and the net loss from continuing operations was $61.9 million, or $0.90 per basic and diluted share. Non-GAAP adjusted loss from continuing operations per basic and diluted share was $0.69.
Fourth Quarter Highlights
- Total revenue increased by $28.2 million, or 12.5%, as compared to the prior year period. Revenue from the Infusion Services segment increased to $239.5 million, reflecting 13.0% growth year-over-year, driven by organic revenue growth;
- Gross profit from continuing operations was $65.6 million, or 25.9% of revenue, as compared to $68.2 million, or 30.2% of revenue, in the prior year period;
- Adjusted EBITDA from continuing operations was a loss of $30.6 million, primarily reflecting incremental allowance for bad debt expense.
- The Company booked an incremental $31.7 million charge to bad debt, an increase of $29.2 million compared to the prior year period, bringing the total bad debt expense in 2014 to $79.6 million. The Company believes this charge appropriately reserves older account receivables;
- The Company implemented an annualized $15 million in previously identified cost savings projects and identified incremental gross savings of $9 million expected to be realized in 2015, for a total of $24 million of expected gross cost savings in the year. Net of investments and expenses to support double digit organic growth and continued improvement of cash collections, the Company anticipates realizing a total of $10 million in net cost savings in 2015;
- Cash flow from continuing operations was positive for the second consecutive sequential quarter at $2.0 million; and,
- As a result of the continued focus on cash collections, the Company has increased monthly average accounts receivable collections from $70.0 million in the first quarter of 2014 to $83.0 million in the fourth quarter of 2014.
“Fourth quarter and full year 2014 results reflect double digit organic revenue growth in our infusion business. We have taken a number of actions to align our cost structure and focus our resources in support of core infusion therapies, which we believe will continue to drive profitable growth and shareholder value. In addition, following an in-depth review of our bad debt reserve, we recorded a charge this quarter that we feel appropriately reserves older account receivables,” said Rick Smith, President and Chief Executive Officer of BioScrip.
“As we head into 2015, we expect to continue to focus on double digit organic growth, operating cash flow generation and cost savings initiatives. We have confidence that our platform and our solid payor and hospital relationships will continue to drive profitable growth,” concluded Mr. Smith.
Results of Operations
Fourth Quarter 2014 versus Fourth Quarter 2013
Revenue from continuing operations for the fourth quarter of 2014 totaled $253.7 million, compared to $225.5 million for the same period a year ago, an increase of $28.2 million or 12.5%. Infusion Services segment revenue was $239.5 million in the fourth quarter of 2014 as compared to $212.0 million for the same period in 2013. The 13.0% increase was driven primarily by continued strong organic growth.
Consolidated gross profit for the fourth quarter of 2014 was $65.6 million, or 25.9% of revenue, compared to $68.2 million, or 30.2% of revenue, for the fourth quarter of 2013. The decrease in gross profit dollars and margin percentage was primarily the result of a decrease in the PBM Services segment and the impact of therapy mix on the Infusion Services segment.
During the fourth quarter of 2014, on a consolidated basis, Adjusted EBITDA from continuing operations declined by $43.9 million to a loss of $30.6 million, compared to $13.3 million in the prior year period. Infusion Services segment Adjusted EBITDA was a loss of $18.3 million in the fourth quarter of 2014.
PBM Services segment revenue was $14.2 million for the fourth quarter of 2014, compared to $13.5 million for the prior year period. PBM Services segment Adjusted EBITDA was $1.6 million, or 11.2% of segment revenue, for the fourth quarter of 2014 compared to $1.7 million, or 12.7% of segment revenue, in the prior year quarter.
Interest expense in the fourth quarter of 2014 was $9.3 million compared to $8.0 million in the prior year period.
Income tax expense for continuing operations in the fourth quarter of 2014 was $2.9 million compared to an income tax expense of $2.6 million in the prior year period.
Net loss from continuing operations for the fourth quarter of 2014 was $61.9 million, or a loss of $0.90 per basic and diluted share, compared to a net loss of $15.6 million, or $0.23 per basic and diluted share, in the prior year period.
Twelve Months Ended 2014 versus Twelve Months Ended 2013
Revenue from continuing operations for the twelve months ended December 31, 2014 totaled $984.1 million, compared to $769.5 million for the same period a year ago. The 27.9% increase was driven primarily by organic growth in infusion therapies. Infusion Services segment revenue was $922.7 million for the twelve months ended December 31, 2014, compared to $696.9 million for the same period in 2013, a 32.4% increase.
Consolidated gross profit for the twelve months ended December 31, 2014, was $261.1 million, or 26.5% of revenue, compared to $243.6 million, or 31.7% of revenue, in the prior year. The net increase in gross profit was primarily due to organic growth. Consolidated gross profit margin percentage was primarily impacted by the PBM Services segment and the impact of therapy mix on the Infusion Services segment.
PBM Services segment revenue for the twelve months ended December 31, 2014 was $61.4 million, compared to $72.6 million for the prior year period.
For the twelve months ended December 31, 2014, on a consolidated basis, Adjusted EBITDA from continuing operations declined by $68.8 million to a loss of $23.0 million, compared to $45.7 million in the prior year period. Infusion Services segment Adjusted EBITDA was $6.5 million, or 0.7% of segment revenue, compared to $60.7 million, or 8.7% of segment revenue, in the prior year. On a pro-forma basis, Infusion Services segment Adjusted EBITDA was $62.8 million, compared to $60.7 million, in the prior year period.
On a pro-forma basis, consolidated Adjusted EBITDA from continuing operations was $39.3 million, which adjusts for the impact of non-recurring items that primarily include $56.3 million in Infusion Services pro-forma adjustments and $5.8 million of one-time accounting fees incurred during the fourth quarter of 2014.
Interest expense for the twelve months ended December 31, 2014 was $38.5 million compared to the $28.2 million in the prior year.
Income tax expense from continuing operations for the twelve months ended December 31, 2014 was $11.4 million, compared to an income tax expense of $2.5 million in 2013.
The net loss from continuing operations, net of taxes, for the twelve months ended December 31, 2014 was $143.4 million, or $2.09 per basic and diluted share, compared to a net loss of $57.0 million, or $0.89 per basic and diluted share, in the prior year.
Liquidity and Capital Resources
For the twelve months ended December 31, 2014, BioScrip used $24.6 million in net cash from continuing operating activities, compared to cash used of $46.0 million during the twelve months of 2013, a decrease of $21.4 million. The Company achieved positive cash flow from continuing operations during the last two quarters of 2014. As of December 31, 2014, the Company has $740,000 in cash and $423.8 million of outstanding debt. In addition, the Company had availability of $70.0 million on its $75.0 million revolving credit facility.
Conference Call and Presentation
BioScrip will host a conference call and live webcast to discuss its fourth quarter 2014 financial results on March 2, 2015 at 8:30 a.m. Eastern Time. Interested parties may participate by dialing 800-771-6917 (US), or 212-231-2919 (International) or accessing a link on the Company’s website at www.bioscrip.com. The Company is also providing supplemental slides that will be posted prior to the conference call and will be accessible through the “Investor Relations” section of the BioScrip website at www.bioscrip.com.
A replay of the conference call will be available for two weeks after the call’s completion by dialing 800-633-8284 (US) or 402-977-9140 (International) and entering conference call ID number 21762174. An audio webcast and archive will also be available for 30 days under the “Investor Relations” section of the Company’s website.
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