TLCVision Corporation: TLCVision Reports First Quarter 2009 Results
ST. LOUIS, MO--(Marketwire - May 14, 2009) - TLCVision Corporation (
James B. Tiffany, President and Chief Operating Officer of TLCVision, commented, "Overall, we had a seasonally strong first quarter that was consistent with industry estimates. While demand for Lasik surgery remains soft, we benefitted from growth in our non-refractive businesses and from our cost reduction initiatives.
"Our non-refractive businesses, which include other surgical procedures and general eye care, posted revenue growth in the quarter of 23%, and this growth helped to offset weaker performance in our refractive businesses. We also continue to realize significant cost reductions related to ongoing initiatives that generated approximately $11.0 million of cost savings in the first quarter of 2009 versus the first quarter of 2008. Furthermore, we generated $5.3 million in operating cash flow in the quarter versus ($6.2) million in the fourth quarter of 2008, bringing our cash balance at March 31, 2009 to $18.5 million.
"We recently announced the formation of the office of the Chairman consisting of our Chairman, Chief Restructuring Officer and myself. The Office of the Chairman is working diligently and constructively with our lenders and advisors to secure a more flexible capital structure.
"Although we are encouraged by recent economic data on consumer spending, we remain resolute on positioning the Company to weather the current economic climate while reaping the substantial benefits of the economic rebound when pent-up demand returns."
First Quarter 2009 Results -- Revenue for the first quarter was $69.4 million, a 23% decrease over prior year revenue of $90.4 million, with refractive revenues showing a decline of 37% while our current non-refractive businesses grew by a combined 23%. - Refractive Centers revenue of $36 million decreased by 39%, as majority-owned center procedures declined by 38%, consistent with estimated market declines. - Doctor Services revenue of $23.6 million decreased by 6%, reflecting weakness in the refractive access business, as the non-refractive businesses showed growth of 9%. - Eye Care revenue of $9.9 million increased 56%. This increase was due to the timing of the annual national meeting and an increase in franchise revenue. -- Overhead expenses were reduced by 23% or $4.8 million below prior year costs, and those costs included advisor fees and expenses of $2.7 million related to the Company's ongoing lender negotiations. -- Consolidated net loss attributable to TLCVision Corporation for the first quarter was $1.3 million, compared to net income of $6.1 million from the prior year period. Net loss attributable to TLCVision Corporation per diluted share for the first quarter was ($0.03), compared to net income of $0.12 for the prior year period. -- Pro-forma net income attributable to TLCVision Corporation for the first quarter (excluding severance and restructuring charges) was $1.4 million or $0.03 per fully diluted share, compared with $6.1 million, or $0.12 per fully diluted share in our record first quarter of 2008. -- Adjusted EBITDA for the first quarter was $8.8 million compared to $14.0 million in our record first quarter of 2008.
Use of Non-GAAP Measures
Pro-forma results are presented to facilitate a comparison of current year and prior year results. The calculations of pro-forma results are not specified by United States generally accepted accounting principles ("GAAP"). Our calculations of pro-forma results may not be comparable to similarly-titled measures of other companies. A reconciliation of reported net income to pro-forma net income for the quarter is included in the attached Consolidated Statements of Operation.
Adjusted EBITDA is a non-GAAP financial measure. It is used in addition to and in conjunction with results presented in accordance with GAAP. This non-GAAP financial measure reflects an additional way of viewing aspects of our operations that, when viewed with our GAAP results, provide a more complete understanding of factors and trends affecting our business. A schedule detailing the calculation of Adjusted EBITDA is attached to this release.
Non-GAAP measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with generally accepted accounting principles.
Conference Call
The company will host a conference call and live webcast with investors and analysts on Thursday, May 14, 2009 at 10:00 a.m. (EDT). To access, please dial 877-795-3647 or 719-325-4781 (international callers) and enter the pass code: 6758749. The call will be broadcast live on the company's website at [ www.tlcv.com ] under the "Webcasts" link in the Investor Relations section.
A replay of the conference call will be available until May 22, 2009. To access the replay, dial 888-203-1112 or 719-457-0820 (international callers) and enter the pass code: 6758749. The call will also be archived on the company's website at [ www.tlcv.com ] under the "Webcasts" link in the Investor Relations section.
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, Section 21E of the U.S. Securities Exchange Act of 1934 and Canadian Provincial Securities Laws, which statements can be identified by the use of forward-looking terminology, such as "may," "will," "expect," "intend," "anticipate," "estimate," "predict," "plans" or "continue" or the negative thereof or other variations thereon or comparable terminology referring to future events or results. We caution that all forward-looking information is inherently uncertain and that actual results may differ materially from the assumptions, estimates or expectations reflected in the forward-looking information. A number of factors could cause actual results to differ materially from those in forward-looking statements, including but not limited to economic conditions, the level of competitive intensity for laser vision correction, the market acceptance of laser vision correction, concerns about potential side effects and long term effects of laser vision correction, the ability to maintain agreements with doctors on satisfactory terms, quarterly fluctuation of operating results that make financial forecasting difficult, the volatility of the market price of our common shares, profitability of investments, successful execution of our direct-to-consumer marketing programs, the ability to open new centers, the reliance on key personnel, medical malpractice claims and the ability to maintain adequate insurance therefore, claims for federal, state and local taxes, compliance with industry regulation, compliance with U.S. and Canadian healthcare regulations, disputes regarding intellectual property, many of which are beyond our control.
Therefore, should one or more of theses risks materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary significantly from what we currently foresee. Accordingly, we warn investors to exercise caution when considering any such forward-looking information herein and to not place undue reliance on such statements and assumptions. We are under no obligation (and we expressly disclaim any such obligation) to update or alter any forward-looking statements or assumptions whether as a result of new information, future events or otherwise, except as required by law.
See the Company's reports filed with the Canadian Securities Regulators and the U.S. Securities and Exchange Commission from time to time for cautionary statements identifying important factors with respect to such forward-looking statements, including certain risks and uncertainties, that could cause actual results to differ materially from results referred to in forward-looking statements. TLCVision assumes no obligation to update the information contained in this press release.
About TLCVision
TLCVision is North America's premier eye care services company, providing eye doctors with the tools and technologies needed to deliver high-quality patient care. Through its centers' management, technology access service models, extensive optometric relationships, direct to consumer advertising and managed care contracting strength, TLCVision maintains leading positions in Refractive, Cataract and Eye Care markets. Information about vision correction surgery can be found on the TLC Laser Eye Centers' website at [ www.lasik.com ]. More information about TLCVision can be found on the Company's website at [ www.tlcv.com ].
TLC VISION CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (In thousands, except per share amounts) Three months ended March 31, -------------------- 2009 2008 --------- --------- Revenues: Refractive centers $ 36,000 $ 58,967 Doctor services 23,556 25,063 Eye care 9,866 6,325 --------- --------- Total revenues 69,422 90,355 Cost of revenues (excluding amortization): Refractive centers 26,035 37,357 Doctor services 18,334 18,141 Eye care 4,772 2,822 --------- --------- Total cost of revenues (excluding amortization) 49,141 58,320 --------- --------- Gross profit 20,281 32,035 --------- --------- General and administrative 5,936 8,367 Marketing and sales 6,828 11,651 Amortization of intangibles 583 830 Other expense (income), net 2,518 (197) --------- --------- Total operating costs 15,865 20,651 --------- --------- Operating income 4,416 11,384 Interest income 134 210 Interest expense (3,101) (2,476) Earnings from equity investments 350 217 --------- --------- Income before income taxes 1,799 9,335 Income tax expense (210) (447) --------- --------- Net income 1,589 8,888 Less: Net income attributable to noncontrolling interest 2,913 2,816 --------- --------- Net (loss) income attributable to TLC Vision Corporation $ (1,324) $ 6,072 ========= ========= Net (loss) income per share attributable to TLC Vision Corporation, diluted $ (0.03) $ 0.12 ========= ========= Weighted average number of common shares outstanding, diluted 50,518 50,282 Calculation of Pro Forma Net (Loss) Income and EPS Net (loss) income attributable to TLC Vision Corporation, as reported $ (1,324) $ 6,072 Add: Restructuring Costs 2,686 0 --------- --------- Pro forma net income attributable to TLC Vision Corporation $ 1,362 $ 6,072 ========= ========= Pro forma net income per share attributable to TLC Vision Corporation, diluted $ 0.03 $ 0.12 ========= ========= Calculation of Adjusted EBITDA Net (loss) income attributable to TLC Vision Corporation, as reported $ (1,324) $ 6,072 Add: Income tax (benefit) expense 210 447 Depreciation and amortization 4,012 4,895 Interest expense, net 2,967 2,266 Non-cash compensation 208 357 Severance and restructuring charges 2,686 - --------- --------- Adjusted EBITDA $ 8,759 $ 14,037 ========= ========= Adjusted EBITDA per share, diluted $ 0.17 $ 0.28 --------- --------- TLC VISION CORPORATION CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) As of As of March 31, December 31, 2009 2008 ----------- ----------- ASSETS Current assets: Cash and cash equivalents $ 18,534 $ 4,492 Accounts receivable, net 18,474 16,870 Prepaid expenses, inventory and other 13,310 14,214 ----------- ----------- Total current assets 50,318 35,576 Restricted cash 876 - Investments and other assets, net 11,469 11,694 Goodwill 28,570 28,570 Other intangible assets, net 9,900 10,628 Fixed assets, net 48,784 50,514 ----------- ----------- Total assets $ 149,917 $ 136,982 =========== =========== LIABILITIES Current liabilities: Accounts payable $ 19,272 $ 17,897 Accrued liabilities 22,779 28,076 Current maturities of long-term debt (including $76.7 million of term debt at March 31, 2009 and $82.7 million in default December 31, 2008) 106,997 89,081 ----------- ----------- Total current liabilities 149,048 135,054 Long-term debt, less current maturities 16,239 16,500 Other long-term liabilities 5,000 5,444 ----------- ----------- Total liabilities 170,287 156,998 ----------- ----------- STOCKHOLDERS' DEFICIT TLC Vision Corporation stockholders' deficit: Common stock, no par value 339,342 339,112 Option and warrant equity 745 745 Accumulated other comprehensive loss (1,337) (1,545) Accumulated deficit (374,982) (373,658) ----------- ----------- Total TLC Vision Corporation stockholders' deficit (36,232) (35,346) Noncontrolling interest 15,862 15,330 ----------- ----------- Total stockholders' deficit (20,370) (20,016) ----------- ----------- Total liabilities and stockholders' deficit $ 149,917 $ 136,982 ----------- ----------- TLC VISION CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (In thousands, except per share amounts) Three months ended March 31, -------------------- 2009 2008 --------- --------- OPERATING ACTIVITIES Net (loss) income attributable to TLC Vision Corporation $ (1,324) $ 6,072 Adjustments to reconcile net (loss) income attributable to TLC Vision Corporation to net cash from operating activities: Depreciation and amortization 4,012 4,895 Noncontrolling interest 2,913 2,816 Earnings from equity investments (350) (217) Gain on sales and disposals of fixed assets (164) (69) Gain on sale of businesses - (145) Non-cash compensation expense 208 357 Other 384 251 Changes in operating assets and liabilities, net of acquisitions and dispositions: (404) 8,846 --------- --------- Cash provided by operating activities 5,275 22,806 --------- --------- INVESTING ACTIVITIES Purchases of fixed assets (417) (851) Proceeds from sales of fixed assets 189 165 Distributions and loan payments received from equity investments 657 601 Acquisitions and equity investments (4,588) (2,984) Divestitures of businesses - 1,179 Other 37 29 --------- --------- Cash used in investing activities (4,122) (1,861) --------- --------- FINANCING ACTIVITIES Restricted cash movement (876) (14) Principal payments of debt financing and capital leases (1,770) (13,199) Proceeds from debt financing 17,971 5,384 Capitalized debt costs (78) (534) Distributions to noncontrolling interests (2,381) (2,746) Proceeds from issuances of common stock 23 231 --------- --------- Cash provided by (used in) financing activities 12,889 (10,878) --------- --------- Net increase in cash and cash equivalents during the period 14,042 10,067 Cash and cash equivalents, beginning of period 4,492 12,925 --------- --------- Cash and cash equivalents, end of period $ 18,534 $ 22,992 ========= ========= Operating cash flow per diluted share $ 0.10 $ 0.45