-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PMnbdYs/m+iGM0+ExScveSJmfGRJpcA6obr/Nw7OZCa2kPuqqd4hfPv30kqFcyMy LQx/9aY5lUVaoMgfhWUXTQ== 0000897069-03-000831.txt : 20030801 0000897069-03-000831.hdr.sgml : 20030801 20030801141721 ACCESSION NUMBER: 0000897069-03-000831 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030729 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030801 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HANGER ORTHOPEDIC GROUP INC CENTRAL INDEX KEY: 0000722723 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SPECIALTY OUTPATIENT FACILITIES, NEC [8093] IRS NUMBER: 840904275 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10670 FILM NUMBER: 03817595 BUSINESS ADDRESS: STREET 1: TWO BETHESDA METRO CENTER STREET 2: SUITE 1300 CITY: BETHESDA STATE: MD ZIP: 20814 BUSINESS PHONE: 3019860701 MAIL ADDRESS: STREET 1: TWO BETHESDA METRO CENTER STREET 2: SUITE 1300 CITY: BETHESDA STATE: MD ZIP: 20814 FORMER COMPANY: FORMER CONFORMED NAME: SEQUEL CORP DATE OF NAME CHANGE: 19890814 FORMER COMPANY: FORMER CONFORMED NAME: CELLTECH COMMUNICATIONS INC DATE OF NAME CHANGE: 19860304 8-K 1 cmw64.txt CURRENT REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): July 29, 2003 _________________ HANGER ORTHOPEDIC GROUP, INC. (Exact Name of Registrant as Specified in Charter) Delaware 1-10670 84-0904275 (State or Other Jurisdiction of (Commission File (I.R.S. Employer Incorporation) Number) Identification No.) Two Bethesda Metro Center, Suite 1200, Bethesda, MD 20814 (Address of Principal Executive Office) (Zip Code) Registrant's telephone number, including area code: (301) 986-0701 Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (a) Not applicable. (b) Not applicable. (c) Exhibits: Exhibit Description ------- ----------- 99.1 Press Release dated April 30, 2003. Item 12. Results of Operations and Financial Condition. Furnished herewith as Exhibit 99.1 is a press release issued by Hanger Orthopedic Group, Inc. on July 29, 2003. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HANGER ORTHOPEDIC GROUP, INC. /s/ George E. McHenry -------------------------------------- Date: July 31, 2003 George E. McHenry Chief Financial Officer EXHIBIT INDEX Exhibit Description - ------- ----------- 99.1 Press Release dated July 29, 2003. EX-99.1 3 cmw64a.txt PRESS RELEASE [GRAPHIC OMITTED] [HANGER ORTHOPEDIC LOGO] Two Bethesda Metro Center Phone 301-986-0701 Suite 1200 Fax 301-986-0702 Bethesda, MD 20814 Contacts: Ivan R. Sabel (301) 986-0701 George E. McHenry(301) 986-0701 Jason P. Owen (301) 986-0701 NEWS RELEASE HANGER ORTHOPEDIC GROUP, INC. ANNOUNCES SECOND QUARTER NET INCOME OF $0.35 PER DILUTED SHARE, A 21% INCREASE BETHESDA, MARYLAND, July 29, 2003 - Hanger Orthopedic Group, Inc. (NYSE:HGR) today announced net income of $0.35 per diluted share for the three-month period ended June 30, 2003. Net sales for the quarter ended June 30, 2003 increased by $5.8 million, or 4.4%, to $138.9 million from $133.1 million in the prior year's comparable quarter. The sales growth was primarily the result of a $2.3 million, or 1.9%, increase in same-center sales in the Company's O&P practices and a $1.9 million, or 27.6%, increase in sales of the Company's distribution segment. Gross profit for the second quarter of 2003 was $73.5 million, or 52.9%, of net sales, compared to $69.9 million, or 52.5%, of net sales, in the second quarter of the prior year. The improvement in gross profit, in both dollars and as a percentage of net sales, was due to a reduction in labor costs. Income from operations increased by $2.3 million in the second quarter of 2003 to $25.2 million from $22.9 million in the same period of the prior year. The increase in income from operations is the result of increased net sales and gross profit. Net income for the second quarter of 2003 was $9.4 million, or approximately $0.35 per diluted share, on 26.8 million weighted average diluted shares outstanding. During the quarter it became more dilutive to earnings per share to convert the Company's outstanding preferred stock to common stock, therefore the preferred stock dividends declared and accretion of $1.4 million were not included in the computation, as required by accounting principles generally accepted in the United States. In the corresponding period of the prior year, Hanger had net income of $7.7 million, or approximately $0.29 per diluted share, on 22.0 million weighted average diluted shares outstanding. Net sales for the six months ended June 30, 2003 increased by $8.5 million, or 3.3%, to $265.1 million from $256.6 million in the prior year's comparable period. The sales growth was primarily the result of a $2.6 million or 1.1% increase in same-center sales in the Company's O&P practices and a $3.4 million, or 24.9%, increase in the sales of the Company's distribution segment. Gross profit for the first six months of 2003 was $139.0 million, or 52.4% of net sales, compared to $133.8 million, or 52.1%, of net sales, in the prior year. The improvement in gross profit, in both dollars and as a percentage of net sales, was due to a reduction in labor and material costs. Income from operations increased by $4.1 million in the first half of 2003 to $43.4 million from $39.3 million in the same period of the prior year. The increase in income from operations is the result of increased net sales and gross profit. Net income for the first six months of 2003 was $14.8 million, or approximately $0.55 per diluted share, on 26.8 million weighted average diluted shares outstanding. During the first six months of 2003 it became more dilutive to earnings per share to convert the preferred stock to common stock, therefore the preferred stock dividends declared and accretion of $2.7 million were not included in the computation, as required by accounting principles generally accepted in the United States. In the corresponding period of the prior year, Hanger had net income of $9.2 million, or approximately $0.31 per diluted share, on 21.7 million weighted average diluted shares outstanding. Chairman and CEO Ivan R. Sabel stated, "Sales continued to improve at our patient-care centers during the quarter. We were able to achieve our profitability goals through a combination of the sales increase, continued control of our costs and the continued exceptional overall performance by our distribution segment. This quarter's results represent record sales and earnings". Hanger Orthopedic Group, Inc., headquartered in Bethesda, Maryland, is the world's premier provider of orthotic and prosthetic patient-care services. Hanger is the market leader in the United States, owning and operating 591 patient-care centers in 44 states and the District of Columbia, with 3,139 employees including 875 certified practitioners. Hanger is organized into two business segments: patient-care, which consists of nationwide orthotic and prosthetic practice centers, and distribution, which consists of distribution centers managing the supply chain of orthotic and prosthetic componentry to Hanger and third party patient-care centers. In addition, Hanger operates the largest orthotic and prosthetic managed care network in the country. ______________________ Certain statements included in this press release are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Please refer to the Company's SEC filings for factors that could cause actual results to differ materially from the Company's expectations. -tables to follow- Hanger Orthopedic Group, Inc. (In Thousands, Except Share and Per Share Data)
Three Months Six Months Income Statement: Ended June 30, Ended June 30, - ----------------- 1 1 2003 2002 2003 2002 Net sales $ 138,936 $ 133,056 $ 265,064 $ 256,566 Cost of goods sold 65,416 63,189 126,106 122,726 ---------- ---------- ---------- ---------- Gross profit 73,520 69,867 138,958 133,840 Selling, general and administrative 45,712 44,690 90,478 89,467 Depreciation and amortization 2,620 2,294 5,073 5,078 ---------- ---------- ---------- ---------- Income from operations 25,188 22,883 43,407 39,295 Interest expense 9,354 9,978 18,450 19,056 Loss on early extinguishment of debt --- --- --- 4,686 ---------- ---------- ---------- ---------- Income before taxes 15,834 12,905 24,957 15,553 Provision for income taxes 6,481 5,234 10,126 6,360 ---------- ---------- ---------- ---------- Net income 9,353 7,671 14,831 9,193 Less preferred stock dividends declared and accreted 1,381 1,291 2,738 2,557 ---------- ---------- ---------- ---------- Net income applicable to common stock $ 7,972 $ 6,380 $ 12,093 $ 6,636 ========== ========== ========== ========== Diluted Per Share Data: Net income $ 0.35 $ 0.29 $ 0.55 $ 0.31 ========== ========== ========== ========== Weighted average number of diluted common shares outstanding 26,844,609 22,013,471 26,804,325 21,669,180 ========== ========== ========== ==========
June 30, June 30, Balance Sheet Data: 2003 2002 - ------------------ ---- ---- Working Capital $134,314 $139,191 Total Debt 379,609 391,438 Shareholders' Equity 180,399 154,361 Note 1: Approximately $1.9 million in medical benefits for the quarter and six month period ended June 30, 2002 were reclassed from Selling, General and Administrative expenses to Cost of Goods Sold to conform to the current year presentation. -more- Hanger Orthopedic Group, Inc.
Three Months Six Months Statistical Data: Ended June 30, Ended June 30, - ----------------- -------------- -------------- 2003 2002 2003 2002 ---- ---- ---- ---- Patient-care centers 591 586 591 586 Certified practitioners 875 859 875 859 Number of states (including D.C.) 45 45 45 45 Payer Mix: Private pay and other 55.1% 56.8% 55.4% 57.0% Medicare 33.6% 32.1% 32.9% 31.7% Medicaid 9.0% 9.0% 9.2% 9.2% VA 2.3% 2.1% 2.5% 2.1% EBITDA (millions) $27.8 $25.2 $48.5 $44.4 EBITDA margin 20.0% 18.9% 18.3% 17.3% Operating margin 18.1% 17.2% 16.4% 15.3% Percentage of net sales from: Patient-care services 93.6% 94.8% 93.6% 94.4% Distribution 6.4% 5.2% 6.4% 5.6%
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