Nightingale Acquisition Target VantageMed Announces Year-End Results



    MARKHAM, ON, March 1 /CNW/ - Nightingale Informatix Corporation
("Nightingale" or the "Company") (TSX-V: NGH), a healthcare application
service provider (ASP) of Electronic Medical Record (EMR) and practice
management solutions, today announces that its acquisition target, VantageMed,
has released financial results for the three- and 12-month periods ended
December 31, 2006. On February 19, 2007, Nightingale announced that it had
entered into a definitive agreement to acquire all the outstanding shares of
VantageMed, with the acquisition expected to close prior to April 15, 2007.
The following is the text of VantageMed's release. All figures are in U.S.
dollars unless otherwise noted.
    VantageMed reported a profit of $145,000, or $0.01 per basic and diluted
share, in the fourth quarter of 2006, compared to a loss of ($303,000), or
($0.02) per share, for the year ago quarter and ($232,000), or ($0.02) per
share, for the prior quarter. Net loss for the year ended December 31, 2006
was ($983,000), or ($0.07) per share, compared to a net loss of
($4.3) million, or ($0.31) per share, for the year ended December 31, 2005.

    Revenues

    Total revenues for the quarter ended December 31, 2006 were $2.9 million,
a decrease of $599,000, or 17.3%, from the year ago quarter and an increase of
$251,000, or 9.6%, from the quarter ended September 30, 2006. Total revenues
for the year ended December 31, 2006 were $11.0 million, a decrease of
$4.3 million, or 28.3%, from $15.3 million for the year ended December 31,
2005. The decrease in revenues in the year-over-year periods is primarily a
reflection of the Company's previously stated strategy to discontinue support
of legacy technology products and consolidate its practice management
customers onto a core set of higher value products. This process was completed
in 2006.
    The increase in revenues in the consecutive quarterly periods was
primarily the result of a successful sales and marketing promotion that has
continued into the first quarter of 2007. Although this particular program has
yielded some continued success in 2007, the Company does not expect the impact
to revenues beyond the first quarter of 2007 to be as significant. VantageMed
has also continued to experience growth in recurring revenues(1) associated
with its core product group. Recurring revenues from core products increased
4.2% from $7.6 million in 2005 to $7.9 million in 2006 and in the consecutive
quarterly periods increased 2.1% to $2.0 million.

    Costs, Expenses and Cash

    Over the course of 2006, VantageMed continued to reduce its spending on
resources once committed to the support and migration process for the
discontinued legacy products and shifted its sales, marketing and operations
focus to its core product lines. Several vendor contracts were renegotiated or
restructured during 2006 to reduce ongoing costs which, along with reductions
in labor costs, contributed to an improvement in gross margins from 36.3% in
2005 to 51.3% in 2006. Company staffing levels were reduced to 85 at
December 31, 2006 from 130 at December 31, 2005.
    The Company generated $405,000 of cash from operations in the fourth
quarter of 2006 and reduced its cash usage from operations to $702,000 in 2006
from $4.6 million in 2005. This considerable reduction in cash usage for the
annual periods is due to the significant cost and expense reductions
implemented in 2005 and 2006. Both the year end sales promotion and year end
maintenance billings contributed toward the cash generated during the fourth
quarter. As of December 31, 2006, VantageMed had cash and short term
investments totaling $820,000.

    Management Commentary

    Steve Curd, VantageMed's CEO, commented, "I am pleased to report
profitable results of operations during the fourth quarter and a net loss of
less than $1 million for the year. This is the first time we have reported a
quarterly profit since I joined VantageMed in November 2004. These improved
financial results helped position VantageMed favorably for the cash offer by
Nightingale that we announced last week. As I stated previously, the market
for our core practice management products and services is maturing and we
require a robust suite of Electronic Medical Record products to maintain our
customer base and facilitate our future growth. To obtain EMR technology on
our own would have required extensive stockholder dilution. The purchase price
and liquidity in the Nightingale offer is fair from a financial point of view,
as verified by an independent analysis from Healthcare Growth Partners, Inc.
Also, the combined company will be significantly larger than VantageMed is
today, which will allow us to improve support to clients and eliminate
expenses associated with our being a public company in the U.S., while the
additional scale will enable us to intensify our focus on providing
comprehensive, high quality solutions and support services to our customer
base."

    VantageMed Acquisition by Nightingale

    The definitive agreement with Nightingale Informatix Corporation calls
for VantageMed stockholders to receive a fixed price of $0.75 per share.
VantageMed has filed materials related to the merger with the Securities and
Exchange Commission and plans to file the proxy statement for the special
stockholders meeting before March 15, 2007.

    About Nightingale

    Nightingale Informatix Corporation is one of North America's fastest
growing healthcare application service providers (ASP). Nightingale's
Internet-based Electronic Health Record (EHR), Electronic Medical Record (EMR)
and practice management solutions are designed to help physicians, clinics,
hospitals and other healthcare organizations more efficiently manage their
operations and patient records.
    Nightingale's products and services offer physicians in United States and
Canada leading-edge functionality for clinical documentation, patient
scheduling, resource scheduling, billing, transcription, end-to-end coding and
claims processing, data management, work flow tools, laboratory interfaces,
documentation management and patient portals, along with other real-time
services. The Company's proprietary offerings of software include
myNightingale, Entity and Physician WorkStation, providing physicians with a
fully integrated, simple-to-use system that automates daily tasks and creates
a single, accessible source of patient data.

    About VantageMed

    VantageMed is a trusted provider of healthcare software products and
services to more than 18,000 physicians, anesthesiologists and behavioral
health providers nationwide. These providers use VantageMed's core products
including ChartKeeper Computerized Medical Records software as well as
RidgeMark, Northern Health Anesthesia and Helper family of Practice Management
products which are all supported by SecureConnect electronic transaction
services. VantageMed is dedicated to providing these cost effective, easy to
use solutions that empower healthcare providers and their staff with the tools
and data they need to improve productivity and reimbursements. For more
information about VantageMed and our products, please call 877-879-8633, or
visit our website at www.vantagemed.com.
    VantageMed defines recurring revenues as revenues derived from sales of
software and hardware maintenance contracts and electronic transactions.
Recurring revenue is not a measurement defined by US GAAP and should not be
considered an alternative to, or more meaningful than, revenues as defined by
US GAAP. Not all companies calculate recurring revenues in the same manner as
VantageMed or at all. Accordingly, VantageMed's recurring revenue data may not
be comparable with that of other companies. VantageMed has included the
following information concerning recurring revenues because they believe
recurring revenues provide useful information regarding overall revenue mix.

    
                                 (a) Three Months End       (b) Year Ended
                              (c) Dec  (d) Sep  (e) Dec     Dec 31   Dec 31
                                  31       30       31       2006      2005
                                 2006     2006     2005      ----      ----
                                 ----     ----     ----
    Recurring (non-GAAP)        $2,090   $2,052   $2,587    $8,485   $11,138
    Non-recurring (non-GAAP)       775      562      877     2,475     4,157
                                   ---      ---      ---     -----     -----
    Total revenues (GAAP)       $2,865   $2,614   $3,464   $10,960   $15,295
                                ------   ------   ------   -------   -------
                                ------   ------   ------   -------   -------
    



    Forward Looking Statement

    This press release contains "forward-looking statements" within the
meaning of applicable Canadian securities legislation. Generally,
forward-looking statements can be identified by the use of forward-looking
terminology such as "plans", "expects" or "does not expect", "is expected",
"budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or
"does not anticipate", or "believes", or variations of such words and phrases
or state that certain actions, events or results "may" ,"could", "would",
"might" or "will be taken", "occur" or "be achieved". Forward-looking
statements are subject to known and unknown risks, uncertainties and other
factors that may cause the actual results, level of activity, performance or
achievements of Nightingale to be materially different from those expressed or
implied by such forward-looking statements, including but not limited to:
risks related to the offering and the acquisition not being completed on
favourable terms, or all, speculative nature of the medical software industry,
which is affected by numerous factors beyond Nightingale's control; the
ability of Nightingale to successfully integrate its acquisitions and any
liabilities arising as a result of such acquisitions; the existence of present
and possible future government regulation; the significant and increasing
competition that exists in the medical software industry; the early stage of
Nightingale's business; and therefore it is subject to the risks associated
with early stage companies, including uncertainty of revenues, markets and
profitability and the need to raise additional funding. In particular, there
is no assurance that the Offering will be completed as it is subject to market
conditions. There is no assurance that the acquisition of VantageMed
Corporation will be completed upon the announced terms or at all.
    Although Nightingale has attempted to identify important factors that
could cause actual results to differ materially from those contained in
forward-looking statements, there may be other factors that cause results not
to be as anticipated, estimated or intended. There can be no assurance that
such statements will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking
statements. Nightingale does not undertake to update any forward-looking
statements that are incorporated by reference herein, except in accordance
with applicable securities laws. Further information on Nightingale Informatix
Corporation is available at www.sedar.com.

    The TSX Venture Exchange Inc. has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release.





For further information:

For further information: Dave Mason, Investor Relations, The Equicom
Group, Tel: (416) 815-0700 x237, Email: dmason@equicomgroup.com; Crystal
Quast, Media Relations, The Equicom Group, Tel: (416) 815-0700 x240, Email:
cquast@equicomgroup.com

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Nightingale Informatix Corporation

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