Nightingale reports fiscal 2008 results



    MARKHAM, ON, July 29 /CNW/ - Nightingale Informatix Corporation
("Nightingale" or the "Company") (TSX-V: NGH), an application service provider
(ASP) of electronic medical record (EMR) software and related services with
more than 5.3 million patient records under management, announces its
financial results for the three- and 12-month periods ended March 31, 2008.
All results are reported in Canadian dollars unless otherwise stated.

    
    Q4 and Fiscal 2008 Highlights
    -----------------------------
    -  Completed US$13.0 million acquisition of VantageMed Corporation in Q1
       and in Q4, sold Therapist Helper (one of four VantageMed business
       units) for net proceeds of US$11.0 million. The performance of this
       division is reported as discontinued operations and accordingly
       reduced fiscal 2008 reported revenue and net income by $4.2 million
       and $0.5 million, respectively, and reduced Q4 fiscal 2008 reported
       revenue and net income by $0.7 million and $0.09 million, respectively
    -  Revenue from continuing operations for fiscal 2008 was $18.9 million,
       compared to $14.0 million in fiscal 2007. The change in the U.S.
       dollar negatively affected revenue for fiscal 2008 by 9%, or
       $1.4 million.
    -  Revenue for Q4 fiscal 2008 was $4.2 million, compared to $3.4 million
       in Q4 fiscal 2007. The change in the U.S. dollar negatively affected
       Q4 revenue for fiscal 2008 by 14%, or $0.5 million
    -  Recurring Revenue for fiscal 2008 was $13.1 million, compared to
       $9.8 million in fiscal 2007, and Recurring Revenue for Q4 fiscal 2008
       was $3.2 million, compared to $2.5 million in Q4 fiscal 2007.
    -  Grew number of healthcare practitioners on technology platform to
       13,000 from 5,000 in 2007.
    -  Increased number of patient records under management on Company's ASP
       EMR to 5.3 million from 2.5 million in 2007.
    -  Secured a 15-year contract with OntarioMD to be one of three funding
       approved ASP EMR providers in Ontario. Subsequent to year-end,
       completed the OntarioMD certification process, enabling eligible
       primary care physicians across Ontario to receive funding when
       implementing Nightingale's hosted EMR solution.
    -  Won a three-year US$3.1 million revenue cycle management agreement
       with Baltimore, Maryland-based Harbor Hospital.
    -  Signed a three-year agreement with the Medical Society of the State of
       New York (MSSNY) to be one of three preferred ASP EMR providers for
       MSSNY's 30,000 members.
    

    "Through a combination of acquisitive and organic growth initiatives, in
fiscal 2008 we grew the base of healthcare practitioners and patients on our
technology platform, expanded our geographic footprint throughout North
America, and strengthened our team to better address the unique needs of the
Canadian and U.S. healthcare markets," said Sam Chebib, President & CEO
Nightingale Informatix Corporation. "In terms of revenue and profitability, we
experienced some downward pressure on our reported operating results for the
year due in part to the divestiture of our Therapist Helper business. However,
this sale generated approximately $10 million in cash in the current year,
enabling us to reduce our long-term debt by almost 50 percent and add cash
resources to the balance sheet."
    "We enter fiscal 2009 focused on improved financial performance, in
particular achieving positive cash flow and expanding our base of recurring
revenue. We intend to drive growth by increasing the number of healthcare
practitioners on our technology platform, cross-selling our products and
services to our existing customers and capitalizing on our patient base by
launching patient-centric products. Furthermore, as we received OntarioMD
certification earlier this month, our team is now working to convert our
pipeline of opportunities into sales, which we expect to materialize in the
upcoming quarters."

    Q4 and Fiscal 2008 Financial Review
    -----------------------------------
    As a result of Nightingale's sale of Therapist Helper, all financial
results for the three- and 12-month periods ended March 31, 2008, are reported
on a continuing operations basis.
    Revenue from continuing operations for fiscal 2008 increased 35% to
$18.9 million, compared to revenue of $14.0 million in fiscal 2007. The
year-over-year improvement primarily reflects incremental revenue from the
acquired VantageMed business and increased professional services revenue,
which were partially offset by the negative impact of the fluctuation in
foreign exchange and a decrease in data management and transcription revenue.
For Q4 fiscal 2008, revenue from continuing operations was $4.2 million, a 23%
increase over revenue of $3.4 million in Q4 fiscal 2007.
    Recurring revenue, consisting of support and maintenance, utilization and
transaction fees, transcription and billing services, increased $3.3 million,
or 33%, to $13.1 million, or approximately 69% of total revenue, for fiscal
2008. This is compared to recurring revenue of $9.8 million, or 70% of total
revenue, for fiscal 2007. Recurring revenue for Q4 fiscal 2008 increased to
$3.2 million, or 78% of total revenue, compared to $2.5 million, or 74% of
total revenue, in Q4 fiscal 2007.
    During 2008, Nightingale generated approximately 69% of its revenue in
the U.S. As such, the Company estimates that revenue was negatively affected
by U.S. currency fluctuations relative to the Canadian dollar by a difference
of approximately 9%, or $1.4 million. In Q4 fiscal 2008, Nightingale generated
approximately 75% of its revenue in the U.S. and estimates that revenue was
negatively affected by a difference of approximately 14%, or $0.5 million.
Nightingale generates approximately 50% of its expenses (including costs of
goods sold) in the U.S., providing the Company with a natural hedge position.
The Company expects to continue to be susceptible to currency exchange
fluctuations.
    In fiscal 2008, gross profit margin increased to 73% from 68% in fiscal
2007, primarily as a result of an increase in higher-margin software sales.
Gross profit margin for Q4 fiscal 2008 was 71%, up from gross profit margin of
68% in Q4 fiscal 2007.
    Nightingale generated an EBITDA loss of $3.5 million in fiscal 2008,
compared to an EBITDA loss of $3.8 million in fiscal 2007. For Q4 fiscal 2008,
Nightingale generated an EBITDA loss of $1.2 million, compared to an EBITDA
loss of $1.6 million for the same period in fiscal 2007.
    Loss from continuing operations was $14.3 million, or $(0.22) per share,
in fiscal 2008, compared to a net loss of $5.7 million, or $(0.14) per share,
in fiscal 2007. The year-over-year increase is primarily a result of lower
data management and transcription revenue, increased amortization of
intangible assets associated with the acquisition of VantageMed and increased
interest expenses related to the Company's long-term debt. With the sale of
Therapist Helper, Nightingale also incurred a $4.6 million tax expense
comprised of a $3.3 million non-cash income tax expense relating to the
expected realization of previously unrecognized tax losses acquired on the
acquisition of VantageMed, a $0.9 million current income tax provision and a
$0.4 million tax provision related to estimated withholding taxes. Combined,
these factors contributed approximately $10.0 million to the Company's loss
from continuing operations for fiscal 2008. For Q4 fiscal 2008, loss from
continuing operations was $7.3 million, or $(0.11) per share, compared to a
net loss of $2.0 million, or $(0.05) per share, for Q4 fiscal 2007.
    Cash and cash equivalents increased $3.3 million to $5.0 million at
March 31, 2008, from $1.7 million at March 31, 2007.
    At March 31, 2008, total shares issued and outstanding were 67,478,540.
    The financial statements and MD&A will be available at
http://www.nightingale.md and filed on www.sedar.com on July 29, 2008. This
press release should be read in conjunction with Nightingale's Consolidated
Financial Statements for the fiscal year ended March 31, 2008 and the
accompanying Management Discussion and Analysis.

    Non-GAAP Financial Measures

    The Company internally measures its performance and results of
initiatives through a number of measures that are not recognized under
Canadian generally accepted accounting principles (GAAP) and may not be
comparable to similar measures used by other companies.

    a. Recurring and Non-Recurring Revenue

    The Company has included recurring revenue and non-recurring revenue
measurements since it believes that this information is useful to investors to
evaluate its performance. Investors should be cautioned, however, that
recurring revenue and non-recurring revenue should not be construed as an
alternative to revenue as determined in accordance with GAAP.

    b. EBITDA

    EBITDA is a non-GAAP measure that management believes is a useful
measurement to evaluate the performance of the Company. Investors should be
cautioned, however, that EBITDA should not be construed as an alternative to
net earnings as determined in accordance with GAAP. The Company's method of
calculating EBITDA may differ from the methods used by other companies and,
accordingly, it may not be comparable to similarly titled measures used by
other companies.
    EBITDA is defined as earnings before other loss (income), interest,
income taxes, depreciation, amortization, and stock-based compensation.
Management believes it is useful to exclude these items as they are either
non-cash expenses, items that cannot be influenced by management in the short
term, or items that do not impact core operating performance, and Management
uses this information internally for forecasting and budgeting purposes.

    
    The following provides a reconciliation of EBITDA to Net Loss calculated
in accordance with GAAP:

    -------------------------------------------------------------------------
                                  Fiscal      Fiscal
                                 Quarter     Quarter        Year        Year
                                   Ended       Ended       Ended       Ended
                                March 31,   March 31,   March 31,   March 31,
    Definition                      2008        2007        2008        2007
    -------------------------------------------------------------------------

    Loss and
     Comprehensive Loss        $  (6,273)  $  (1,956)  $ (12,811)  $  (5,713)
    -------------------------------------------------------------------------

    Adjustments for:
    Gain on Sale of
     Discontinued Operations   $    (977)  $       -   $    (977)  $       -
    Earnings from
     Discontinued Operations         (92)          -        (501)          -
    Current Tax Expense            1,299           -       1,299           -
    Future Tax Expense             3,300           -       3,300           -
    Other Loss (Income)              (26)        (34)        144        (192)
    Interest                        1008          46       3,297         639
    Depreciation and Amortization    552         257       2,190         867
    Stock-based Compensation          23          52         535         558
    -------------------------------------------------------------------------

    EBITDA                      $ (1,186)  $  (1,635)   $  (3,524)  $ (3,841)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    Notice of Conference Call and Webcast
    -------------------------------------
    Nightingale will host a conference call on Tuesday July 29, 2008 at
8:30 a.m. Eastern Standard Time. To access the conference call by telephone,
dial 416-644-3426 or 1-800-731-5319. Please connect approximately fifteen
minutes prior to the beginning of the call to ensure participation. The
conference call will be archived for replay until Monday, August 5, 2008. To
access the archived conference call, dial 416-640-1917 or 1-877-289-8525 and
enter reference 21279023 followed by the number sign. A live audio webcast of
the call will be available at www.newswire.ca and http://www.nightingale.md.
Please connect to the website at least 15 minutes prior to the conference call
to ensure adequate time for any software download that may be necessary. The
webcast will be archived for 365 days.

    About Nightingale

    Nightingale is one of the fastest growing healthcare service and software
companies in North America with over 5.3 million patient records under
management in a hosted (ASP) environment. It is recognized as an industry
leader in Web-based clinician and community based electronic medical records
(EMR) serving the needs of small primary care practices, multi-physician
outpatient clinics, and large scale regional health organizations and
networks. Coupled with integrated practice management, transcription and
revenue cycle management, Nightingale's comprehensive service offering allows
customers to enhance patient care, increase revenue opportunities and optimize
operations. Nightingale is continuously innovating and enhancing its services
to meet the needs of its growing and diverse customer base. Nightingale -
Healthcare connected. www.nightingale.md

    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 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 capital.
    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 has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release


    
    CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
    FOR THE YEAR ENDED MARCH 31, 2008

    -------------------------------------------------------------------------
                                                         Year           Year
                                                        Ended          Ended
                                                     March 31,      March 31,
                                                         2008           2007
    -------------------------------------------------------------------------

    Revenue                                      $ 18,875,556   $ 14,014,108

    Cost of Sales
    Hardware, Software and Services                 4,661,951      4,043,824
    Sales Commissions                                 507,267        381,154
                                                 -------------  -------------
                                                    5,169,218      4,424,978
                                                 -------------  -------------

    Gross Profit                                   13,706,338      9,589,130
                                                 -------------  -------------

    Expenses
    General and Administration                      3,773,404      3,826,080
    Sales and Marketing                             3,191,495      2,881,932
    Research and Development                        4,611,547      3,814,413
    Client Services                                 5,655,493      2,908,160
    Stock Based Compensation                          534,992        557,860
    Depreciation and Amortization                   2,189,583        867,262
                                                 -------------  -------------
                                                   19,956,514     14,855,707
                                                 -------------  -------------

    Operating Loss                                 (6,250,176)    (5,266,577)
                                                 -------------  -------------

    Interest                                        3,296,684        638,807
    Foreign Currency Loss (Gain)                      143,956       (192,148)
                                                 -------------  -------------

    Loss from Continuing Operations Before Tax     (9,690,816)    (5,713,236)

    Current Tax Expense                             1,298,811              -
    Future Tax Expense                              3,299,857              -
                                                 -------------  -------------

    Loss from Continuing Operations               (14,289,484)    (5,713,236)
    Earnings from Discontinued Operations             501,113              -
    Gain on Sale of Discontinued Operations           976,944              -
                                                 -------------  -------------

    Loss and Comprehensive Loss                  $(12,811,427)  $ (5,713,236)
                                                 -------------  -------------
                                                 -------------  -------------

    Basic and Diluted (Loss per Common Share)
    Loss from Continuing Operations                     (0.22)         (0.14)
    Earnings from Discontinued
     Operations - Basic and Diluted                      0.01              -
    Gain on Sale of Discontinued Operations              0.01              -
                                                 -------------  -------------
    Loss and Comprehensive Loss per Common Share        (0.19)         (0.14)
                                                 -------------  -------------
                                                 -------------  -------------

    Weighted Average Number of
     Common Shares - Basic and Diluted             66,227,558     40,119,580
                                                 -------------  -------------
                                                 -------------  -------------

                                               ------------------------------
                                               ------------------------------


    CONSOLIDATED BALANCE SHEET
    AS AT MARCH 31, 2008

    -------------------------------------------------------------------------
                                                        As at          As at
                                                     March 31,      March 31,
                                                         2008           2007
    -------------------------------------------------------------------------
    ASSETS

    Current Assets
    Cash and Cash Equivalents                    $  5,033,746   $  1,747,660
    Accounts Receivable                             3,151,582      3,018,767
    Other Receivables                               1,034,721         79,739
    Inventory                                         168,948          7,893
    Prepaid Expenses                                  649,207        257,157
                                                 -------------  -------------
                                                   10,038,204      5,111,216
                                                 -------------  -------------

    Long-Term Assets
    Deferred Costs                                    201,940        626,890
    Property and Equipment                          1,722,276      1,352,739
    Intangible Assets                               7,336,804      3,108,571
    Goodwill                                        4,692,399      7,331,853
                                                 -------------  -------------
                                                   13,953,419     12,420,053
                                                 -------------  -------------

    Total Assets                                 $ 23,991,623   $ 17,531,269
                                                 -------------  -------------
                                                 -------------  -------------

    LIABILITIES

    Current Liabilities
    Borrowing under Line of Credit               $          -   $  1,541,733
    Accounts Payable and Accrued Liabilities        5,384,530      2,770,367
    Current Portion of Deferred Revenue             4,199,690      1,829,931
    Current Portion of Capital Lease Obligations      278,658        258,586
                                                 -------------  -------------
                                                    9,862,878      6,400,617
                                                 -------------  -------------

    Long Term Liabilities
    Subordinated Debt                               5,295,648              -
    Deferred Compensation Payable to Employees              -        100,824
    Deferred Revenue                                1,214,110      1,716,512
    Capital Lease Obligations                         438,682        196,246
                                                 -------------  -------------
                                                    6,948,440      2,013,582
                                                 -------------  -------------

    Total Liabilities                              16,811,318      8,414,199
                                                 -------------  -------------

    SHAREHOLDERS' EQUITY
    Capital Stock                                  27,521,485     18,553,953
    Contributed Surplus                             1,459,085      1,021,217
    Warrants                                        3,277,011      1,807,749
    Deficit                                       (25,077,276)   (12,265,849)
                                                 -------------  -------------
                                                    7,180,305      9,117,070
                                                 -------------  -------------

    Total Liabilities and Shareholders' Equity   $ 23,991,623   $ 17,531,269
                                                 -------------  -------------
                                                 -------------  -------------

                                               ------------------------------
                                               ------------------------------


    CONSOLIDATED STATEMENT OF CASH FLOWS
    FOR THE YEAR ENDED MARCH 31, 2008

    -------------------------------------------------------------------------
                                                         Year           Year
                                                        Ended          Ended
                                                     March 31,      March 31,
                                                         2008           2007
    -------------------------------------------------------------------------
    Cash Flow from Operating Activities
    Loss from continuing operations              $(14,289,484)  $ (5,713,236)

    Adjustments for:
    Depreciation and Amortization                   2,189,583        867,262
    Amortization of Transaction Costs
     Related to Debt Financing                        536,398              -
    Gain on Sale of Assets                            (22,130)             -
    Stock Based Compensation                          534,992        557,860
    Future Tax Expense                              3,299,857              -
    Unrealized Foreign Exchange Gain                  (83,813)       (34,735)
    Interest Accretion                              1,138,700              -
                                                 -------------  -------------
                                                   (6,695,897)    (4,322,849)

    Changes in Non-Cash Working Capital Balances
      Accounts Receivable                             500,593     (1,503,360)
      Investment Tax Credits Receivable                     -        221,191
      Prepaid Expenses                               (195,044)       173,327
      Inventory                                      (132,224)             -
      Deferred Costs                                  424,950       (266,667)
      Other Receivables                              (929,806)       147,820
      Accounts Payable and Accrued Liabilities        326,993        607,230
      Deferred Compensation Payable                  (100,824)      (303,151)
      Deferred Revenue                                (71,523)       757,927
                                                 -------------  -------------
    Cash flows used in operating activities        (6,872,782)    (4,488,532)
                                                 -------------  -------------

    Cash Flow from Investing Activities
    Purchase of Property and Equipment               (368,671)       (10,349)
    Investment in Development of
     Proprietary Software                                   -       (205,062)
    Sale of Helper Division,                       10,810,873              -
    IHPS Acquisition                                        -     (2,990,880)
    VantageMed Acquisition                        (13,533,087)             -
                                                 -------------  -------------
    Cash flows used in investing activities        (3,090,885)    (3,206,291)
                                                 -------------  -------------

    Cash Flow from Financing Activities
    Increase in Capital Stock                       8,741,932      9,422,375
    Payments on Bank Loan                                   -       (148,782)
    Proceeds from Subordinated Debt Financing      11,089,812      5,000,000
    Repayment of Subordinated Debt Financing       (6,000,000)    (4,569,000)
    Repayment of Promissory Notes Payable                   -     (1,643,500)
    Repayment of Capital Lease Obligations           (297,961)      (534,034)
    Increase (Decrease) in Borrowing
     under Line of Credit                          (1,541,733)     1,541,733
                                                 -------------  -------------
    Cash flows provided by financing activities    11,992,050      9,068,792
                                                 -------------  -------------

    Foreign Exchange Gains(Losses) on Cash
     Held in Foreign Currency                        (227,769)       157,413

    Net Increase in Cash From
     Continuing Operations                          2,256,152      1,216,556
    Net Increase in Cash From
     Discontinued Operations                        1,257,703              -
                                                 -------------  -------------
    Net Increase in Cash During the Period          3,286,086      1,373,969
    Cash and Cash Equivalents,
     Beginning of Period                            1,747,660        373,691
                                                 -------------  -------------

    Cash and Cash Equivalents, End of Period     $  5,033,746   $  1,747,660

                                               ------------------------------
                                               ------------------------------

    Non-cash investing and financing activities:
      Acquisition of property and
       equipment under capital lease             $    520,128   $    170,564

    Supplemental cash flow information:
      Interest paid                              $  1,734,905   $    271,179
      Income taxes paid                          $          -   $          -
    

    %SEDAR: 00022709E




For further information:

For further information: Michael Ford, CFO, Nightingale Informatix
Corporation, Tel: (905) 307-7870, mford@nightingale.md; Dave Mason, Investor
Relations, The Equicom Group, Tel: (416) 815-0700 x237, Email:
dmason@equicomgroup.com

Organization Profile

Nightingale Informatix Corporation

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890