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MONTREAL, July 12, 2013 /CNW Telbec/ - OPMEDIC GROUP Inc. ("OPMEDIC GROUP") (TSX: OMG), a healthcare-related company in fertility, laboratories and surgeries providing services and facilities to patients and surgeons, announces its financial results for the third quarter ended May 31, 2013.
HIGHLIGHTS FOR THE QUARTER ENDED MAY 31, 2013:
- Revenue down by 4%. Revenue for the quarter ended May 31, 2013 amounted to $4.863 million compared to $5.084 million in 2012.
- Gross profit down by 14%. Gross profit for the quarter ended May 31, 2013 amounted to $2.147 million compared to $2.497 million in 2012.
- Net earnings up by 52%. Net earnings and net earnings per share for the quarter ended May 31, 2013 were respectively $0.997 million and $0.06 compared to $0.658 million and $0.04 in 2012.
Revenues for the quarter ended May 31, 2013 totalled $4.863 million, down $0.221 million or 4% from $5.084 million for the same period the previous year. Prenatal screening was down $0.110 million because of the increased offer of services in Quebec's public healthcare system. Surgical activities decreased by $0.117 million as a result of the decline in operating room rentals revenues. For fertility activities, the new clinic in Newmarket, Ontario recorded revenues of $0.166 million, which were offset by a decline in the fertility clinics in Quebec.
Revenues for the nine-month period ended May 31, 2013 totalled $14.513 million, down $0.417 million or 3% from $14.930 million for the previous period. Prenatal screening was down $0.331 million, a trend that has continued for a number of quarters following the expanded offer in the public system. Surgical activities declined by $0.145 million as a result of the drop in operating room rentals revenues while the Montreal South Shore endoscopic centre increased its revenues by $0.315 million.
Cost of services
The cost of services for the quarter ended May 31, 2013 was $2.716 million, up $0.129 million or 5% from $2.587 million in 2012. The new activities of the Newmarket fertility clinic entailed costs of $0.147 million in payroll, consulting fees and purchases of medication, while the fertility clinics in Quebec recorded an increase in payroll and fees of $0.114 million. Otherwise, payroll, supplies, depreciation and amortization were down $0.132 million for surgical activities, and $0.036 million for prenatal screening.
For the nine-month period ended May 31, 2013, the cost of services was $7.901 million, up $0.552 million or 8% from $7.349 million in 2012. The new activities of the Newmarket fertility clinic incurred costs of $0.445 million in payroll, consulting fees and purchases of medication, while the fertility clinics in Quebec recorded an increase in payroll, supplies and fees of $0.317 million. However, payroll, supplies, depreciation and amortization were down $0.340 million for surgical activities, and $0.117 million for prenatal screening. Finally, the higher volume of activities at the Montreal South Shore endoscopic centre required additional costs of $0.184 million in payroll, rent, supplies, depreciation and amortization.
Gross profit for the quarter ended May 31, 2013 totalled $2.147 million, down $0.350 million or 14% from $2.497 million in 2012. Gross profit for the fertility segment was down by $0.348 million and in the OPMEDIC division there was a small drop of $0.002 million.
Gross profit in relation to revenues for the quarter was 44% in 2013, versus 49% in 2012.
Gross profit for the nine-month period ended May 31, 2013 was $6.612 million, down $0.969 million or 13% from $7.581 million in 2012. For the fertility segment, gross profit decreased by $1.015 million, while in the OPMEDIC division, it was up by $0.046 million.
Gross profit in relation to revenues for the nine-month period was 46% in 2013, versus 51% in 2012.
General and administrative expenses
General and administrative expenses for the quarter ended May 31, 2013 totalled $1.318 million, down $0.112 million or 8% from $1.430 million in 2012. The expenses of the new clinic in Newmarket totalled $0.025 million which were offset by the $0.109 million drop in research and development expenses and the $0.034 million in professional fees.
For the nine-month period ended May 31, 2013, general and administrative expenses were $4.087 million, up $0.135 million or 3% from $3.952 million in 2012. The expenses of the new clinic in Newmarket totalled $0.102 million and stock-based compensation increased by $0.063 million which were offset by the drop of $0.032 million in communication costs.
In order to enhance the profitability of its surgical and endoscopic services business unit, the Corporation restructured its operations in the Laval area. In fact, until just recently, surgical activities were provided in premises with four operating rooms while endoscopic activities were offered in another location with two operating rooms. Following the restructuring, operations were merged at surgical locations, which now have three operating rooms, with the fourth room currently being used as a separate sterilization room for endoscopy. As a result, some of the Corporation's assets were impaired in the amount of $0.539 million less a gain on disposal of assets held under finance leases for a net amount of $0.437 million, which was recognized in the current quarter.
Share of investments in joint ventures
The share of the profit on investments in joint ventures for the quarter ended May 31, 2013 was $0.736 million, versus a loss of $0.066 million in 2012. During the quarter, joint venture 4531582 Canada Inc., in which the Corporation has a 50% interest, sold the land and building of the Montreal South Shore medical centre. This sale resulted in a non-recurring pre-tax profit of $0.978 million for the Corporation's share.
For the nine-month period ended May 31, 2013, the share of the profit on investments in joint ventures totalled $0.694 million, compared with a loss of $0.211 million in 2012. The non-recurring profit on the sale of the medical centre accounted for the significant gain in 2013 compared with 2012.
Net profit and earnings per share for the quarter ended May 31, 2013 were respectively $0.997 million and $0.06, compared with $0.658 million and $0.04 in 2012. Net profit in relation to revenues was 21%, versus 13% in 2012.
For the nine-month period ended May 31, 2013, net profit and earnings per share were respectively $2.102 million and $0.12, compared with $2.283 million and $0.13 in 2012. Net profit in relation to revenues was 14%, versus 15% in 2012.
DECLARATION OF DIVIDEND ON COMMON SHARES
The Company's Board of Directors has declared a cash dividend of $0.02 per share payable on July 31, 2013 to shareholders of record at the close of business on July 24, 2013. Future dividends are subject to the discretion of the Board of Directors.
The Company designates this dividend to be an "eligible dividend" pursuant to subsection 89(14) of the Income Tax Act (Canada) and its equivalent in any provinces of Canada.
Detailed financial results can be accessed on the OPMEDIC GROUP web site at www.opmedicgroup.com.
About OPMEDIC GROUP
OPMEDIC GROUP is a company incorporated under the laws of the Province of Quebec which provides healthcare-related services including surgical and endoscopic facilities and services to patients and surgeons (with its OPMEDIC division), fertility treatments, medical imaging, laboratory services and diagnostic procedures (with its PROCREA Cliniques division and a joint venture 7667264 Canada Inc.) and sperm banking services (with its PROCREA Cryopreservation Centre subsidiary). OPMEDIC GROUP's Common Shares trade on the Toronto Stock Exchange under the symbol "OMG".
This news release does not constitute an offer to sell or to solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful. This news release contains certain forward-looking statements that reflect the current views and/or expectations of OPMEDIC GROUP with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.
The Content of this press release has not been approved by nor submitted to the TSX which assumes no liability therefore.
SOURCE: OPMEDIC GROUP INC.
For further information:
Vice President Finance and Chief Financial Officer
(514) 345-8535, x 2260