-----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, ILZ3DQhH0B2rwHAPyK84xhtWFnagFSqOMEVKg13llnXVXafcec1CsEx/XZPbtMoP IrvAD9dlx1Kz7BkWCM3uTw== 0000926236-03-000112.txt : 20030728 0000926236-03-000112.hdr.sgml : 20030728 20030728082231 ACCESSION NUMBER: 0000926236-03-000112 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030728 ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030728 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST HEALTH GROUP CORP CENTRAL INDEX KEY: 0000812910 STANDARD INDUSTRIAL CLASSIFICATION: HOSPITAL & MEDICAL SERVICE PLANS [6324] IRS NUMBER: 363307583 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-15846 FILM NUMBER: 03804874 BUSINESS ADDRESS: STREET 1: 3200 HIGHLAND AVE STREET 2: HEALTH COMPARE CORP CITY: DOWNERS GROVE STATE: IL ZIP: 60515 BUSINESS PHONE: 6302417900 MAIL ADDRESS: STREET 1: 3200 HIGHLAND AVENUE STREET 2: 3200 HIGHLAND AVENUE CITY: DOWNERS GROVE STATE: IL ZIP: 60515 FORMER COMPANY: FORMER CONFORMED NAME: HEALTHCARE COMPARE CORP/DE/ DATE OF NAME CHANGE: 19920703 8-K 1 fhg8k03q2.txt 8-K FINANCIAL RESULTS QUARTER ENDED JUNE 30, 2003 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 28, 2003 First Health Group Corp. (Exact name of registrant as specified in its charter) Delaware 0-15846 36-3307583 (State of Incorporation) (Commission (IRS Employer File Number) Identification No.) 3200 Highland Avenue, Downers Grove, IL 60515 (Address of principal executive offices, including zip code) (630) 737-7900 (Registrant's telephone number including area code) Item 9: Information Provided Under Item 12 (Results of Operations and Financial Condition) The information required by Item 12 is being provided under Item 9 pursuant to SEC interim filing guidance provided in SEC press release No. 2003-41. The following information is furnished pursuant to Item 12, "Results of Operations and Financial Condition." The information in this Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. On July 28, 2003, First Health Group Corp. issued a press release announcing financial results for the quarter ended June 30, 2003. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K. 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 thereunto duly authorized. First Health Group Corp. July 28, 2003 /s/ Joseph E. Whitters ----------------------- Joseph E. Whitters Vice President, Finance and Chief Financial Officer EX-99.1 3 exh99-1.txt PRESS RELEASE FINANCIAL RESULTS QUARTER ENDED JUNE 30, 2003 EXHIBIT 99.1 FIRST HEALTH 3200 Highland Avenue Downers Grove, IL 60515-1223 (630) 737-7900 www.firsthealth.com Investor Contact: Joseph E. Whitters, CFO (630) 737-7511 Media Contact: Erin Gardiner (630) 737-5016 FOR IMMEDIATE RELEASE --------------------- FIRST HEALTH REPORTS RECORD RESULTS: 23% EPS GROWTH ---------------------------------------------------------------------------- DOWNERS GROVE, IL - July 28, 2003 - Edward L. Wristen, President and Chief Executive Officer of First Health Group Corp. (NASDAQ: FHCC), announced today the results of operations for the second quarter ended June 30, 2003. Highlights for the quarter include: * Record revenue of $219 million, up 24% from 2Q 2002 * Record net income of $37 million, up 14% from 2Q 2002 * Record EPS of $.38 up 23% from 2Q 2002 Diluted earnings per share (EPS) and net income for the three months and six months ended June 30, 2003, increased 23% to $.38 or $37,171,000 and 23% to $.75 or $74,012,000 respectively, compared with $.31 or $32,484,000 and $.61 or $63,498,000 respectively, during the same periods last year. Revenues for the three months and six months ended June 30, 2003, increased 24% to $218,651,000 from $175,923,000 and 25% to $432,404,000 from $345,284,000, respectively, during the same periods last year. "The second quarter results reflect a continuing strong growth in revenue and net income that was led by the group health and public sector business," said Wristen. "Group health revenue increased 32% to $134,145,000 from second quarter of 2002 primarily due to the Mail Handlers Benefit Plan administration business. Public sector revenue increased 37% to $44,200,000 from second quarter of 2002 primarily due to new clients." Additionally, Mr. Wristen commented that he expects continued strong growth in 2003 revenue to approximately $875 million and EPS in the range of $1.55. Conference Call and Webcast --------------------------- First Health Group Corp. will be hosting a conference call and webcast on Monday, July 28 at 9 a.m. Central Daylight Time to discuss the Company's second quarter results. The quarterly conference call will be available on a live webcast from the Company's website (www.firsthealth.com). The webcast is open to all interested parties on a listen-only basis. Individuals who listen to the call will be presumed to have read First Health's Annual Report on Form 10-K for the year ended December 31, 2002, and Quarterly Report on Form 10-Q for the three months ended March 31, 2003. Business Description -------------------- First Health, the premier national health-benefits services company, specializes in providing large payors with integrated managed care solutions. First Health is a unique national managed care company serving the group health, workers' compensation and state agency markets. Using technology to enable service and managed care innovations, First Health sets the bar for industry performance. For more information, visit the company website at www.firsthealth.com. Forward-Looking Statements Notice --------------------------------- Certain statements herein regarding anticipated financial results for 2003 and the Company's business prospects are forward-looking statements that involve substantial risks and uncertainties. In accordance with the Private Securities Litigation Reform Act of 1995, factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward-looking statements include, among others, the inability of the Company to continue to: (i) enter into contracts with and successfully implement programs for new clients within the time frame established by the Company and achieve the revenue growth expected to result from the addition of such clients, (ii) expand its group health, workers' compensation and public sector business, (iii) control health care benefit expenses, and (iv) successfully integrate the Mail Handlers Benefit Plan administrative assets. All forward-looking statements herein are made as of the date hereof, and the Company undertakes no obligation to update such statements. First Health Group Corp. (000's Omitted Except EPS and Percentages) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, --------------------------- --------------------------- % Increase % Increase 2003 2002 (Decrease) 2003 2002 (Decrease) ------- ------- ---------- ------- ------- ---------- ------------------------------------------------------------------------------------------- Revenues $218,651 $175,923 24% $432,404 $345,284 25% ------------------------------------------------------------------------------------------- Operating Expenses: Cost of Services 100,148 75,077 33% 196,325 148,049 33% Selling and Marketing 21,356 17,755 20% 42,392 34,833 22% General and Administrative 15,447 11,956 29% 30,654 23,349 31% Health Care Benefits 4,389 3,903 12% 9,551 7,684 24% ------- ------- -- ------- ------- -- 141,340 108,691 30% 278,922 213,915 30% ------------------------------------------------------------------------------------------- Operating Income 77,311 67,232 15% 153,482 131,369 17% ------------------------------------------------------------------------------------------- Depreciation and Amortization 15,554 13,356 16% 30,680 26,328 17% Interest Income (1,359) (1,544) (12)% (2,727) (3,172) (14)% Interest Expense 1,421 1,503 (5)% 2,688 2,819 (5)% ------- ------- -- ------- ------- -- Income Before Income Taxes 61,695 53,917 14% 122,841 105,394 17% Income Taxes 24,524 21,433 14% 48,829 41,896 17% ------- ------- -- ------- ------- -- Net Income $ 37,171 $ 32,484 14% $ 74,012 $ 63,498 17% ======= ======= == ======= ======= == Share Information: ------------------ Weighted Average Shares Outstanding - Basic 95,273 101,217 (6)% 96,174 100,759 (5)% ======= ======= == ======= ======= == Net Income Per Common Share - Basic $ .39 $ .32 22% $ .77 $ .63 22% ======= ======= == ======= ======= == Weighted Average Shares Outstanding - Diluted 97,696 104,735 (7)% 98,689 104,584 (6)% ======= ======= == ======= ======= == ------------------------------------------------------------------------------------------- Net Income Per Common Share - Diluted $ .38 $ .31 23% $ .75 $ .61 23% ======= ======= == ======= ======= == -------------------------------------------------------------------------------------------
First Health Group Corp. (000's Omitted Except Percentages) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, --------------------------- --------------------------- % Increase % Increase Revenue Information 2003 2002 (Decrease) 2003 2002 (Decrease) ------- ------- ---------- ------- ------- ---------- ------------------------------------------------------------------------------------------- Commercial Revenue Group Health: PPO + Administration Services $ 91,087 $ 32,512 180% $180,028 $ 66,504 171% PPO Services 38,936 65,561 (41)% 79,795 128,420 (38)% Premiums 4,122 3,810 8% 8,357 7,820 7% ------- ------- -- ------- ------- -- Total Group Health 134,145 101,883 32% 268,180 202,744 32% Workers' Compensation: PPO + Administration Services 25,174 27,206 (7)% 50,159 53,289 (6)% PPO Services 15,132 14,663 3% 30,284 27,780 9% ------- ------- -- ------- ------- -- Total Workers' Compensation 40,306 41,869 (4)% 80,443 81,069 (1)% Total Commercial Revenue 174,451 143,752 21% 348,623 283,813 23% ------- ------- -- ------- ------- -- Public Sector 44,200 32,171 37% 83,781 61,471 36% ------- ------- -- ------- ------- -- Total Revenue $218,651 $175,923 24% $432,404 $345,284 25% ======= ======= == ======= ======= == ------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------- Operating Income Margins* ------------------------------------------------------------------------------------------- Commercial 41% 46% 41% 45% Public Sector 12% 4% 12% 7% ======================================================================================== *Excludes Depreciation and Amortization June 30, December 31, Summary Balance Sheet Information: 2003 2002 --------------------------------- ------- ------- Assets: -------------------------------------------------------------------- Cash and Investments $157,304 $152,712 Accounts Receivable 83,499 69,981 Reinsurance Recoverable 25,959 27,582 Fixed Assets 207,455 205,503 Goodwill 283,231 279,447 Intangible Assets 51,988 54,086 Deferred Taxes 35,240 35,255 Other Assets 18,246 18,795 ------- ------- Total Assets $862,922 $843,361 ======= ======= Liabilities: -------------------------------------------------------------------- Claims Reserves $ 39,700 $ 40,420 Debt Outstanding 150,000 120,000 Deferred Taxes 115,168 114,692 Purchase Reserve 4,934 5,795 Accounts Payable 61,185 50,841 Accrued Expenses 41,931 47,740 Other Liabilities 65,522 49,727 ------- ------- Total Liabilities 478,440 429,215 Stockholders' Equity: 384,482 414,146 ------- ------- Total Liabilities and Stockholders' Equity $862,922 $843,361 ======= =======
First Health Group Corp. (000's Omitted) (Unaudited) Consolidated Statement of Cash Flows: ------------------------------------- Six Months Ended June 30, ------------------------- 2003 2002 -------- -------- Cash flows from operating activities: Net Income $ 74,012 $ 63,498 -------- -------- Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation and amortization 30,680 26,328 Change in allowance for uncollectible receivables (144) 1,893 Provision for deferred income taxes 117 (111) Tax benefits from stock options exercised 6,215 12,423 Other, net (1,248) 103 Changes in Assets and Liabilities (net of effects of acquired businesses): Accounts receivable (13,866) 1,790 Other current assets 688 4,788 Reinsurance recoverable 1,430 863 Accounts payable and accrued expenses (2,570) 8,206 Claims reserves (720) 574 Income taxes payable 15,101 13,574 Non-current assets and liabilities 748 (2,541) -------- -------- Net cash provided by operating activities 110,443 131,388 -------- -------- Cash flows from investing activities: Purchases of investments (20,701) (30,355) Sales of investments 24,349 27,096 Acquisition of business, net of cash acquired (3,442) (24,027) Assets held for sale -- 923 Purchase of property and equipment (30,571) (27,001) -------- -------- Net cash used in investing activities (30,365) (53,364) -------- -------- Cash flows from financing activities: Purchase of treasury stock (119,074) (14,813) Proceeds from issuance of long-term debt 105,000 150,000 Repayment of long-term debt (75,000) (217,500) Proceeds from issuance of common stock 14,703 21,436 Stock option loans to employees -- (2,272) Stock option loan repayments 232 2,360 Sales of put options on common stock -- 375 -------- -------- Net cash used in financing activities (74,139) (60,414) -------- -------- Net increase in cash and cash equivalents 5,939 17,610 Cash and cash equivalents, beginning of period 20,852 14,001 -------- -------- Cash and cash equivalents, end of period $ 26,791 $ 31,611 ======== ======== -----END PRIVACY-ENHANCED MESSAGE-----