Apria’s 2004 revenue jumps 5.1%, net income drops $2 million

Sunday, February 20, 2005

February 21, 2005

LAKE FOREST, Calif. - During the fourth quarter of 2004 , Apria closed one acquisition for $1.6 million, bringing the total number of acquisitions for the year to 27, the company reported in its year-end financial statement released earlier this month.
Revenues were $376.4 million in the fourth quarter, a 5.7% increase over revenues of $356.3 million for the comparable period in 2003. Net income for the fourth quarter was $27.3 million compared to $29.9 million for the fourth quarter of 2003.
Revenues for 2004 were $1.5 billion, a 5.1% increase over 2003 revenues of $1.4 billion. Net income for 2004 was $114 million compared to $116 million in 2003.
As previously reported, the company's overall revenue growth rate and earnings were impacted by the Medicare respiratory medication reimbursement cuts ($3.7 million for the fourth quarter and $15.2 million for the year) and the company's decision not to renew its contract with Gentiva CareCentrix, Inc. Excluding those effects, revenue growth was 10.8% for the fourth quarter and 9.6% for the year.
Days sales outstanding improved to 52 days at December 31, 2004 from 55 days reported at September 30, 2004. This trend is primarily attributable to the timing of acquisitions in 2004. Delays in billing occur as patient data from acquisitions is converted to Apria's systems and as Medicare provider numbers for newly acquired locations are obtained.
In other news, two of the company's current directors, Ralph Whitworth, chairman, and Beverly Benedict Thomas, have decided not to stand for reelection.
In commenting on his decision, Whitworth, a principal of Relational Investors, LLC, said, "Serving as Apria's chairman during its spectacular transformation since April of 1998 is among the most satisfying experiences in my business career. Apria is now the unrivaled industry leader and our stock price has appreciated 330%, giving our shareholders a 20% annualized return over that period. My decision does not reflect my view of Apria's future prospects, but rather my evolving priorities. With Apria solidly positioned for continued excellent performance, I will now be able to devote additional attention to more pressing ongoing projects."
The Board has elected David L. Goldsmith, who has served on Apria's Board for 18 years, to be the Annual Meeting of Stockholders in April.