Attached files
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| 8-K - Catamaran Corp | q22012pressrelease8k.htm |
Catamaran Corporation
Exhibit 99.1
Catamaran Corporation Announces Record Second Quarter Financial Results
- Quarterly net income of $27.3 million and EBITDA of $58.6 million reach record levels -
- Q2 revenue of $1.7 billion increases 40% compared to prior year -
- 2012 guidance updated to reflect merger with Catalyst -
Lisle, Illinois, August 1, 2012 - Catamaran Corporation (formerly known as SXC Health Solutions Corp.) (“Catamaran” or the “Company”) (NASDAQ: CTRX, TSX: CCT), a leading provider of pharmacy benefit management (“PBM”) services and technology, announces its financial results for the three and six month periods ended June 30, 2012.
Q2 2012 Highlights
• | Revenue grew 40% on a year over year basis to $1.7 billion, compared to $1.2 billion in Q2 2011 |
• | Gross profit increased 65% to $122.5 million during Q2 2012, compared to $74.2 million in Q2 2011 |
• | Net income increased 27% to $27.3 million, or $0.41 per share (fully-diluted) for Q2 2012, compared to $21.6 million, or $0.34 per share (fully-diluted), in Q2 2011 |
• | EBITDA¹ increased 50% to $58.6 million for Q2 2012, compared to $39.0 million in Q2 2011 |
• | Adjusted earnings per share¹ (fully-diluted), increased 29% to $0.49 for Q2 2012, compared to $0.38 in Q2 2011 |
• | Both GAAP and Non-GAAP EPS included a $0.09 per share (fully-diluted), impact from transaction expenses and tax expense related to the Catalyst acquisition in Q2 2012 |
• | Cash from operations increased $31.1 million during Q2 2012 compared to Q2 2011 |
• | Adjusted prescription claim volume¹ for the PBM segment increased 46% to 33.2 million, in Q2 2012 compared to 22.8 million in Q2 2011 |
• | Transaction processing volume for the HCIT segment increased to 116.7 million for Q2 2012 compared to 98.1 million in Q2 2011 |
• | Generic dispense rate increased to an industry leading 81% for Q2 2012 compared to 78% in Q2 2011 |
• | The Company issued 5,980,000 common shares through a public offering in May 2012, yielding $519.3 million in proceeds |
• | Today the Company announced, a five year full service PBM contract with BCBS Arizona, valued at $350 million per year in annual drug spend |
• | Successfully converted two HCIT clients to PBM services in the quarter |
• | Subsequent to the quarter end, completed the merger with Catalyst Health Solutions, Inc. (“Catalyst”), a full-service PBM |
• | Executed a $1.8 billion credit agreement subsequent to the quarter end to partially finance the Catalyst acquisition |
“During Q2 we continued to execute on our plan, which yielded another quarter of strong results. The completion of our merger with Catalyst and the rebranding of the combined companies to Catamaran Corporation is the start of a remarkable and transformative time for our Company. This combination brings together the right resources and scale to help solve healthcare challenges for our customers and deliver a distinct product and experience. We believe our increased purchasing power, coupled with a management team that's second to none, has created a truly scaled alternative to the traditional PBM model. All of these factors have put us in a great position to continue delivering a record setting 2012 and continued growth moving forward," said Mark Thierer, Chairman and CEO of Catamaran Corporation.
Catamaran Corporation
Financial Review
Revenue and Gross Profit segmented by PBM and HCIT:
Catamaran evaluates segment performance based on revenue and gross profit. Reconciliations of the Company's business segments, PBM and Health Care Information Technology (“HCIT”), to the consolidated financial statements for the three and six months ended June 30, 2012 and 2011 are as follows:
Three months ended June 30, (unaudited, in thousands)
PBM | HCIT | Consolidated | |||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||||||||
Revenue | $ | 1,661,129 | $ | 1,182,856 | $ | 41,574 | $ | 29,183 | $ | 1,702,703 | $ | 1,212,039 | |||||||||||
Cost of revenue | 1,564,414 | 1,122,501 | 15,785 | 15,335 | 1,580,199 | 1,137,836 | |||||||||||||||||
Gross profit | $ | 96,715 | $ | 60,355 | $ | 25,789 | $ | 13,848 | $ | 122,504 | $ | 74,203 | |||||||||||
Gross profit % | 6 | % | 5 | % | 62 | % | 47 | % | 7 | % | 6 | % | |||||||||||
Six months ended June 30, (unaudited, in thousands)
PBM | HCIT | Consolidated | |||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||||||||
Revenue | $ | 3,342,274 | $ | 2,254,778 | $ | 77,526 | $ | 54,911 | $ | 3,419,800 | $ | 2,309,689 | |||||||||||
Cost of revenue | 3,154,603 | 2,142,689 | 32,304 | 29,221 | 3,186,907 | 2,171,910 | |||||||||||||||||
Gross profit | $ | 187,671 | $ | 112,089 | $ | 45,222 | $ | 25,690 | $ | 232,893 | $ | 137,779 | |||||||||||
Gross profit % | 6 | % | 5 | % | 58 | % | 47 | % | 7 | % | 6 | % | |||||||||||
PBM Revenue
Q2 2012 PBM revenue increased $478.3 million, or 40%, to $1.7 billion, compared to $1.2 billion in Q2 2011. Revenue was $3.3 billion for the year to date (“YTD”) period ended June 30, 2012, an increase of $1.1 billion, or 48%, as compared to the same period in 2011. The increase in revenue is primarily due to increased prescription claim volume as a result of new customer implementations during 2012, as well as revenues generated from customers acquired from the acquisition of HealthTran, LLC ("HealthTran") which closed on January 1, 2012.
HCIT Revenue
HCIT revenue increased $12.4 million, or 42%, to $41.6 million in Q2 2012 compared to $29.2 million in Q2 2011. HCIT revenue increased $22.6 million, or 41%, to $77.5 million for the YTD period ended June 30, 2012, as compared to $54.9 million for the same period in 2011. The increase in the quarterly and YTD periods were primarily due to an increase in revenues earned from transaction processing, revenues generated from the HCIT customer base acquired from HealthTran and an increase in system sales.
Consolidated Gross Profit
Gross profit for Q2 2012 increased $48.3 million, or 65%, to $122.5 million compared to $74.2 million in Q2 2011. Gross profit increased $95.1 million, or 69%, to $232.9 million for the YTD period ended June 30, 2012 as compared to $137.8 million for the same period in 2011. The increase is mostly due to incremental PBM revenues generated from new customer implementations in 2012 and customers acquired from HealthTran. Gross profit percentage increased to 7% of revenue in Q2 2012 from 6% of revenue in Q2 2011. Gross profit has increased from 6% of revenue to 7% of revenue during the YTD period
Catamaran Corporation
ended June 30, 2012 as compared to the same period in 2011. The gross profit percentage increased in both periods primarily as a result of realizing synergies with the integration of HealthTran customers acquired.
Selling, General and Administration (“SG&A”) Costs
SG&A costs for Q2 2012 were $61.2 million compared to $32.2 million in Q2 2011. SG&A costs increased by $55.2 million, or 93% to $114.9 million for the YTD period ended June 30, 2012 compared to $59.7 million for the same period in 2011. SG&A costs have increased due to the addition of operating costs related to the Company's recent acquisitions, including HealthTran, additional resources added to support the growth of the PBM segment and due to transaction and integration expenses related to the merger with Catalyst totaling $6.4 million for Q2 2012, and $6.7 million for the YTD period ended June 30, 2012.
Income Taxes
The Company recognized income tax expense of $17.1 million for Q2 2012, representing an effective tax rate of 38.5%, as compared to $10.9 million, representing an effective tax rate of 33.6%, for the same period in 2011. The Company recognized income tax expense of $30.5 million for the YTD period ended June 30, 2012, representing an effective tax rate of 36.2%, as compared to $20.0 million, representing an effective tax rate of 33.4%, for the same period in 2011. The Company's effective tax rate increased during these periods primarily due to expenses incurred during 2012 related to the merger with Catalyst that are not tax deductible.
Net Income
The Company reported Q2 2012 net income of $27.3 million, or $0.41 per share (fully-diluted), compared to $21.6 million, or $0.34 per share (fully-diluted), in Q2 2011. Net income for the YTD period ended June 30, 2012 was $53.7 million or $0.82 per share (fully-diluted), as compared to $39.8 million or $0.63 per share (fully-diluted) for the same period in 2011. The increase is driven by an increase in revenues from new customer implementations and the HealthTran acquisition offset by an increase in SG&A expense and amortization of intangibles due to acquisitions, and transaction expenses related to the merger with Catalyst and the increase in tax expense due to non-deductible transaction expenses.
Adjusted EPS¹ (fully-diluted), which excludes all transaction-related amortization of intangible assets, net of tax, increased 29% to $0.49 per share (fully-diluted), compared to $0.38 per share (fully-diluted) in Q2 2011. Adjusted EPS¹ (fully-diluted) increased 44% for the YTD period ended June 30, 2012 to $1.01 (fully-diluted), as compared to $0.70 (fully-diluted), in the same period of 2011.
EBITDA¹
Q2 2012 EBITDA increased 50% to $58.6 million compared to $39.0 million in Q2 2011. In the quarter the Company incurred $6.4 million of transaction expenses related to the merger with Catalyst, which are not excluded from EBITDA. EBITDA for the YTD period ended June 30, 2012 increased 56% to $113.0 million, compared to $72.5 million for the same period of 2011. The EBITDA growth was due primarily to new contract implementations, as well as additional business generated from recent acquisitions and their associated synergies.
Catamaran Corporation
Cash from Operations
For Q2 2012, the Company generated $29.7 million of cash from operations, compared to a use of $1.4 million of cash during the same period in 2011. For the YTD period ended June 30, 2012, the Company generated $85.9 million of cash from operations, compared to a use of $0.6 million of cash during the same period in 2011. The increased transaction volume in the PBM segment, propelled by new customer implementations during 2012, as well as the additional business generated as a result of the Company's recent acquisitions, were the primary drivers of increased operating cash flow during 2012.
2012 Full Year Financial Guidance
With today's announcement, the Company is updating its 2012 full year financial targets to reflect the merger with Catalyst. The updated GAAP EPS (fully diluted) and Adjusted EPS (fully diluted) amounts consider the effects of the approximately 33.4 million shares issued to complete the merger;
▪ | Revenue of $9.9 to $10.0 billion. |
▪ | EBITDA1 of $353 to $358 million. |
▪ | GAAP EPS (fully-diluted) of $1.24 to $1.27. |
▪ | Adjusted EPS1 (fully-diluted) of $2.14 to $2.17 (excluding all transaction-related amortization of $126-128 million less an estimated 2012 tax rate of 38-40%). |
Notice of Conference Call
Catamaran will host a conference call on Wednesday, August 1, 2012, at 8:30 a.m. ET to discuss its financial results. Mark Thierer, Chairman and CEO, and Jeff Park, EVP and CFO, will co-chair the call. This call is being webcast and can be accessed from the IR Events page of the Catamaran Corporation web site at www.catamaranrx.com. An archived replay of the webcast will be available for 90 days.
1Non-GAAP Financial Measures
Catamaran reports its financial results in accordance with generally accepted accounting principles in the United States (“GAAP”). Catamaran's management also evaluates and makes operating decisions using various other measures. Two such measures are Adjusted EPS and EBITDA, which are non-GAAP financial measures. Catamaran's management believes that these two measures provide useful supplemental information regarding the performance of Catamaran's business operations.
Adjusted EPS adds back the impact of all amortization of intangible asset expenses, net of tax. Amortization of intangible asset expense arises from the acquisition of intangible assets in connection with the Company's business acquisitions. The Company excludes acquisition-related amortization expense from EPS because it believes (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of Catamaran's business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired intangible assets. Investors should note that the use of these intangible assets contributes to revenue in the periods presented as well as future periods and should also note that such expenses will recur in future periods.
EBITDA is a non-GAAP measure that management believes is a useful supplemental measure of operating performance prior to interest and other expense, net, income taxes, depreciation and amortization. Management believes it is useful to exclude these expenses as they are essentially amounts that cannot be influenced by management in the short term.
The 2012 full year guidance of EBITDA was computed using the Company's estimated 2012 earnings before interest and other
Catamaran Corporation
expense, net, taxes, depreciation and amortization. Adjusted EPS was computed by taking the Company's GAAP EPS (fully-diluted) guidance and adding back the expected impact of all acquisition-related amortization expense totaling approximately $126-128 million less an estimated 2012 tax rate of 38-40%.
Adjusted prescription claim volume equals Catamaran's mail service prescriptions multiplied by three, plus its retail and specialty prescriptions. The mail service prescriptions are multiplied by three to adjust for the fact that they typically include approximately three times the amount of product days supplied compared with retail prescriptions.
Management believes that Adjusted EPS, EBITDA and adjusted prescription claim volume provide useful supplemental information to management and investors regarding the performance of the Company's business operations and facilitate comparisons to its historical operating results. Management also uses this information internally for forecasting and budgeting as it believes that the measures are indicative of the Company's core operating results. Note, however, that these items are performance measures only, and do not provide any measure of the Company's cash flow or liquidity. Non-GAAP financial measures should not be considered as a substitute for measures of financial performance in accordance with GAAP, and investors and potential investors are encouraged to review the reconciliations of Adjusted EPS and EBITDA to their most directly comparable GAAP measure.
Adjusted EPS and EBITDA do not have standardized meanings prescribed by GAAP. The Company's method of calculating these items may differ from the methods used by other companies and, accordingly, may not be comparable to similarly titled measures used by other companies. Reconciliations of EBITDA to net income and GAAP EPS (fully-diluted) to adjusted EPS (fully-diluted) are shown below:
EBITDA Reconciliation | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(in thousands) | 2012 | 2011 | 2012 | 2011 | |||||||||||
(unaudited) | (unaudited) | ||||||||||||||
Net Income (GAAP) | $ | 27,310 | $ | 21,565 | $ | 53,652 | $ | 39,836 | |||||||
Add: | |||||||||||||||
Depreciation of property and equipment | 3,241 | 2,251 | 6,297 | 4,580 | |||||||||||
Amortization of intangible assets | 9,011 | 3,667 | 19,330 | 7,226 | |||||||||||
Interest and other expense, net | 1,980 | 584 | 3,219 | 870 | |||||||||||
Income tax expense | 17,065 | 10,910 | 30,483 | 19,978 | |||||||||||
EBITDA | $ | 58,607 | $ | 38,977 | $ | 112,981 | $ | 72,490 | |||||||
Adjusted EPS Reconciliation | ||||||||||||||||||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||||||||||||||
Operational Results | Per Diluted Share | Operational Results | Per Diluted Share | Operational Results | Per Diluted Share | Operational Results | Per Diluted Share | |||||||||||||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||||||||||||||||
Net income (GAAP) | $ | 27,310 | $ | 0.41 | $ | 21,565 | $ | 0.34 | $ | 53,652 | $ | 0.82 | $ | 39,836 | $ | 0.63 | ||||||||||||||||
Amortization of intangible assets | 9,011 | 0.13 | 3,667 | 0.06 | 19,330 | 0.30 | 7,226 | 0.11 | ||||||||||||||||||||||||
Tax effect of reconciling item | (3,469 | ) | (0.05 | ) | (1,232 | ) | (0.02 | ) | (6,997 | ) | (0.11 | ) | (2,413 | ) | (0.04 | ) | ||||||||||||||||
Non-GAAP net income | $ | 32,852 | $ | 0.49 | $ | 24,000 | $ | 0.38 | $ | 65,985 | $ | 1.01 | $ | 44,649 | $ | 0.70 | ||||||||||||||||
Catamaran Corporation
About Catamaran Corporation
Catamaran, the industry's fastest-growing pharmacy benefits manager, helps organizations and the communities they serve take control of prescription drug costs. Managing more than 200 million prescriptions each year on behalf of 25 million members, our flexible, holistic solutions improve patient care and empower individuals to take charge of their health. Processing one in every five prescription claims in the U.S., Catamaran's skill and scale deliver compelling financial results and sustainable improvement in the overall health of members. Catamaran is headquartered in Lisle, Ill. with multiple locations in the U.S. and Canada. For more information, please visit www.catamaranrx.com.
Forward-Looking Statements
Certain information included herein is forward-looking within the meaning of certain securities laws and is subject to important risks, uncertainties and assumptions. This forward-looking information includes, among other things, information with respect to the Company’s anticipated operating results and the Company's objectives and the strategies to achieve those objectives, as well as information with respect to the Company’s beliefs, plans, expectations, anticipations, estimates and intentions. Numerous factors could cause actual results to differ materially from those in the forward-looking statements, including without limitation, our dependence on, and ability to retain, key customers; our ability to achieve increased market acceptance for our product offerings and penetrate new markets; consolidation in the healthcare industry; the existence of undetected errors or similar problems in our software products; our ability to identify and complete acquisitions, manage our growth, integrate acquisitions and achieve expected synergies from acquisitions; our ability to compete successfully; potential liability for the use of incorrect or incomplete data; the length of the sales cycle for our healthcare software solutions; interruption of our operations due to outside sources; maintaining our intellectual property rights and litigation involving intellectual property rights; our ability to obtain, use or successfully integrate third-party licensed technology; compliance with existing laws, regulations and industry initiatives and future changes in laws or regulations in the healthcare industry; breach of our security by third parties; our dependence on the expertise of our key personnel; our access to sufficient capital to fund our future requirements; potential write-offs of goodwill or other intangible assets; and the outcome of any legal proceeding that has been or may be instituted against us. This list is not exhaustive of the factors that may affect any of our forward-looking statements and is subject to change.
In addition, numerous factors could cause actual results with respect to the merger with Catalyst Health Solutions, Inc. ("Catalyst" or the "Merger") to differ materially from those in the forward-looking statements, including without limitation, the possibility that the expected efficiencies and cost savings from the Merger will not be realized, or will not be realized within the expected time period; the risk that the Company's and Catalyst businesses will not be integrated successfully; disruption from the Merger making it more difficult to maintain business and operational relationships; the risk of customer attrition; and the impact on the availability of funds for other business purposes due to our debt service obligations and funds required to integrate Catalyst.
When relying on forward-looking information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. In making the forward-looking statements contained herein, the Company does not assume any significant future acquisitions, dispositions or one-time items. It does assume, however, the renewal of certain customer contracts. Every year, the Company has major customer contracts that come up for renewal. In addition, the Company also assumes new customer contracts. In this regard, the Company is pursuing large opportunities that present a very long and complex sales cycle which substantially affects its forecasting abilities. The Company has assumed certain timing for the realization of these opportunities which it thinks is reasonable but which may not be achieved. Furthermore, the pursuit of these larger opportunities does not ensure a linear progression of revenue and earnings since they may involve significant up-front costs followed by renewals and cancellations of existing contracts. The Company has assumed certain revenues which may not be realized. The Company has also assumed that the material factors referred to in the previous paragraphs will not cause such forward-looking information to differ materially from actual results or events. The foregoing list of factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.Other factors that should be considered are discussed from time to time in Catamaran's filings with the U.S. Securities and Exchange Commission, including the risks and uncertainties discussed under the captions “Risk Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our 2011Annual Report on Form 10-K and subsequent Form 10-Qs, which are available at www.sec.gov. Investors are cautioned not to put undue reliance on forward-looking statements. All subsequent written and oral forward-looking statements attributable to Catamaran or persons acting on our behalf are expressly qualified in their entirety by this notice. We disclaim any intent or obligation to update publicly these forward-looking statements, whether as a result of new information, future events or otherwise.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS RELEASE REPRESENTS THE COMPANY’S CURRENT EXPECTATIONS AND, ACCORDINGLY, IS SUBJECT TO CHANGE. HOWEVER, THE COMPANY EXPRESSLY DISCLAIMS ANY INTENTION OR OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING INFORMATION, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE, EXCEPT AS REQUIRED BY APPLICABLE LAW.
For more information, please contact:
Tony Perkins | ||
Investor Relations | ||
Catamaran Corporation | ||
(630) 577-4871 | ||
tony.perkins@catamaranrx.com | ||
Catamaran Corporation
CATAMARAN CORPORATION
Consolidated Balance Sheets
(in thousands, except share data)
June 30, 2012 | December 31, 2011 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 798,921 | $ | 341,382 | |||
Restricted cash | 12,588 | 12,017 | |||||
Accounts receivable, net of allowance for doubtful accounts of $2,232 (2011 — $2,725) | 288,121 | 240,425 | |||||
Rebates receivable | 79,312 | 33,834 | |||||
Prepaid expenses and other current assets | 8,553 | 6,409 | |||||
Inventory | 23,039 | 19,554 | |||||
Deferred income taxes | 7,694 | 9,642 | |||||
Total current assets | 1,218,228 | 663,263 | |||||
Property and equipment, net of accumulated depreciation of $49,571 (2011 — $43,304) | 29,017 | 21,658 | |||||
Goodwill | 462,579 | 291,045 | |||||
Other intangible assets, net of accumulated amortization of $67,402 (2011 — $48,072) | 127,577 | 69,777 | |||||
Other assets | 13,830 | 4,564 | |||||
Total assets | $ | 1,851,231 | $ | 1,050,307 | |||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
Current liabilities | |||||||
Accounts payable | $ | 22,333 | $ | 19,679 | |||
Accrued expenses and other current liabilities | 97,076 | 66,729 | |||||
Pharmacy benefit management rebates payable | 64,718 | 59,235 | |||||
Pharmacy benefit claims payable | 276,025 | 199,701 | |||||
Total current liabilities | 460,152 | 345,344 | |||||
Deferred income taxes | 16,712 | 18,361 | |||||
Long term debt | 100,000 | — | |||||
Other liabilities | 8,519 | 15,564 | |||||
Total liabilities | 585,383 | 379,269 | |||||
Commitments and contingencies | |||||||
Shareholders’ equity | |||||||
Common shares: no par value, unlimited shares authorized; 68,987,840 shares issued and outstanding at June 30, 2012 (December 31, 2011 — 62,383,661 shares) | 936,247 | 394,769 | |||||
Additional paid-in capital | 37,616 | 37,936 | |||||
Retained earnings | 291,985 | 238,333 | |||||
Total shareholders’ equity | 1,265,848 | 671,038 | |||||
Total liabilities and shareholders’ equity | $ | 1,851,231 | $ | 1,050,307 | |||
Catamaran Corporation
CATAMARAN CORPORATION
Consolidated Statements of Operations
(in thousands, except share and per share data)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
(unaudited) | (unaudited) | ||||||||||||||
Revenue | $ | 1,702,703 | $ | 1,212,039 | $ | 3,419,800 | $ | 2,309,689 | |||||||
Cost of revenue | 1,580,199 | 1,137,836 | 3,186,907 | 2,171,910 | |||||||||||
Gross profit | 122,504 | 74,203 | 232,893 | 137,779 | |||||||||||
Expenses: | |||||||||||||||
Product development costs | 3,436 | 3,666 | 6,510 | 7,026 | |||||||||||
Selling, general and administrative | 61,223 | 32,229 | 114,864 | 59,668 | |||||||||||
Depreciation of property and equipment | 2,479 | 1,582 | 4,835 | 3,175 | |||||||||||
Amortization of intangible assets | 9,011 | 3,667 | 19,330 | 7,226 | |||||||||||
76,149 | 41,144 | 145,539 | 77,095 | ||||||||||||
Operating income | 46,355 | 33,059 | 87,354 | 60,684 | |||||||||||
Interest and other expense, net | 1,980 | 584 | 3,219 | 870 | |||||||||||
Income before income taxes | 44,375 | 32,475 | 84,135 | 59,814 | |||||||||||
Income tax expense (benefit): | |||||||||||||||
Current | 17,533 | 11,687 | 31,188 | 20,297 | |||||||||||
Deferred | (468 | ) | (777 | ) | (705 | ) | (319 | ) | |||||||
17,065 | 10,910 | 30,483 | 19,978 | ||||||||||||
Net income | $ | 27,310 | $ | 21,565 | $ | 53,652 | $ | 39,836 | |||||||
Earnings per share: | |||||||||||||||
Basic | $ | 0.41 | $ | 0.35 | $ | 0.83 | $ | 0.64 | |||||||
Diluted | $ | 0.41 | $ | 0.34 | $ | 0.82 | $ | 0.63 | |||||||
Weighted average number of shares used in computing earnings per share: | |||||||||||||||
Basic | 66,220,869 | 62,074,246 | 64,374,780 | 61,938,392 | |||||||||||
Diluted | 66,884,741 | 63,768,457 | 65,065,394 | 63,649,369 | |||||||||||
Catamaran Corporation
CATAMARAN CORPORATION
Consolidated Statements of Cash Flows
(in thousands)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
(unaudited) | (unaudited) | ||||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net income | $ | 27,310 | $ | 21,565 | $ | 53,652 | $ | 39,836 | |||||||
Items not involving cash: | |||||||||||||||
Stock-based compensation | 4,064 | 2,419 | 6,853 | 4,102 | |||||||||||
Depreciation of property and equipment | 3,241 | 2,251 | 6,297 | 4,580 | |||||||||||
Amortization of intangible assets | 9,012 | 3,667 | 19,330 | 7,226 | |||||||||||
Deferred lease inducements and rent | 154 | (125 | ) | 205 | (247 | ) | |||||||||
Deferred income taxes | (469 | ) | (778 | ) | (705 | ) | (319 | ) | |||||||
Tax benefit on stock-based compensation plans | (2,792 | ) | (5,696 | ) | (10,581 | ) | (9,019 | ) | |||||||
Changes in operating assets and liabilities, net of effects from acquisitions: | |||||||||||||||
Accounts receivable | 4,259 | (24,879 | ) | (27,584 | ) | (103,044 | ) | ||||||||
Rebates receivable | (32,235 | ) | (723 | ) | (41,012 | ) | (401 | ) | |||||||
Restricted cash | 94 | (1,160 | ) | (571 | ) | (1,172 | ) | ||||||||
Prepaid expenses and other current assets | (798 | ) | (2,162 | ) | (654 | ) | (2,939 | ) | |||||||
Inventory | (1,570 | ) | (1,304 | ) | (3,172 | ) | (3,487 | ) | |||||||
Income taxes | 5,816 | 4,643 | 11,703 | 12,862 | |||||||||||
Accounts payable | 5,578 | (209 | ) | 1,547 | 6,320 | ||||||||||
Accrued expenses and other current liabilities | 2,344 | (95 | ) | 9,985 | (7,879 | ) | |||||||||
Pharmacy benefit claims payable | 12,672 | 7,609 | 61,433 | 60,329 | |||||||||||
Pharmacy benefit management rebates payable | (4,505 | ) | (7,672 | ) | 2,720 | (7,832 | ) | ||||||||
Other | (2,459 | ) | 1,273 | (3,508 | ) | 487 | |||||||||
Net cash provided (used) by operating activities | 29,716 | (1,376 | ) | 85,938 | (597 | ) | |||||||||
Cash flows from investing activities: | |||||||||||||||
Acquisition, net of cash acquired | 294 | (12,985 | ) | (242,884 | ) | (12,985 | ) | ||||||||
Purchases of property and equipment | (4,697 | ) | (898 | ) | (10,839 | ) | (2,095 | ) | |||||||
Net cash used by investing activities | (4,403 | ) | (13,883 | ) | (253,723 | ) | (15,080 | ) | |||||||
Cash flows from financing activities: | |||||||||||||||
Proceeds from public offering, net of issuance costs | 519,260 | — | 519,260 | — | |||||||||||
Proceeds from issuance of debt | — | — | 100,000 | — | |||||||||||
Tax benefit on stock-based compensation plans | 2,792 | 5,696 | 10,581 | 9,019 | |||||||||||
Proceeds from exercise of options | 1,130 | 3,348 | 4,464 | 5,106 | |||||||||||
Payment of financing cost | (9,000 | ) | — | (9,000 | ) | — | |||||||||
Net cash provided by financing activities | 514,182 | 9,044 | 625,305 | 14,125 | |||||||||||
Effect of foreign exchange on cash balances | (11 | ) | (7 | ) | 19 | (25 | ) | ||||||||
Increase (decrease) in cash and cash equivalents | 539,484 | (6,222 | ) | 457,539 | (1,577 | ) | |||||||||
Cash and cash equivalents, beginning of period | 259,437 | 325,929 | 341,382 | 321,284 | |||||||||||
Cash and cash equivalents, end of period | $ | 798,921 | $ | 319,707 | $ | 798,921 | $ | 319,707 | |||||||