SCHAUMBURG, IL, Aug. 1, 2014 /PRNewswire/ - Catamaran Corporation ("Catamaran" or the "Company") (NASDAQ: CTRX, TSX: CCT), a leading provider of pharmacy benefit management ("PBM") services and technology, announces its financial results for the three and six months ended June 30, 2014.
Q2 2014 Highlights
- Revenue increased 58% to $5.4 billion in Q2 2014, compared to $3.4
billion in Q2 2013
- Gross profit increased 25% to $329.8 million in Q2 2014, compared to
$264.6 million in Q2 2013
- EBITDA¹ increased 19% to $188.5 million in Q2 2014, compared to $158.1
million in Q2 2013
- Net income attributable to the Company increased 13% to $71.4 million,
or $0.34 per share (fully-diluted) in Q2 2014, compared to $63.4
million, or $0.31 per share (fully-diluted) in Q2 2013
- Adjusted EPS¹ (fully-diluted) increased 10% to $0.54 in Q2 2014,
compared to $0.49 in Q2 2013
- Cash flow from operations was $57.2 million in Q2 2014, and cash on hand
as of June 30, 2014 was $709.5 million
- Adjusted prescription claim volume¹ for the PBM segment increased 49% to
101.2 million in Q2 2014, compared to 68.0 million in Q2 2013
- Generic dispensing rate increased to 86% for Q2 2014, compared to 84% in
Q2 2013
"The second quarter results reflect our continued success in offering a flexible and scalable alternative within the PBM industry. The Catamaran team continues to execute on multiple strategic efforts, including developing the very best service offering to our clients, integrating the Cigna partnership and Restat acquisition as well as pursuing new opportunities for growth. We continue to build upon our foundation for continued record financial results," said Mark Thierer, Chairman and CEO of Catamaran Corporation.
Financial Review
Revenue and Gross Profit segmented by PBM and HCIT:
Catamaran evaluates segment performance based on revenue and gross profit. Reconciliations of the Company's business segments, PBM and Health Care Information Technology ("HCIT"), to the consolidated financial statements for the three and six months ended June 30, 2014and 2013 are as follows:
Three months ended June 30, (unaudited, in thousands)
| PBM | HCIT | Consolidated | |||||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||||
| Revenue | $ | 5,350,962 | $ | 3,382,195 | $ | 34,846 | $ | 35,235 | $ | 5,385,808 | $ | 3,417,430 | |||||||||||
| Cost of revenue | 5,039,279 | 3,135,211 | 16,716 | 17,630 | 5,055,995 | 3,152,841 | |||||||||||||||||
| Gross profit | $ | 311,683 | $ | 246,984 | $ | 18,130 | $ | 17,605 | $ | 329,813 | $ | 264,589 | |||||||||||
| Gross profit % | 5.8 | % | 7.3 | % | 52.0 | % | 50.0 | % | 6.1 | % | 7.7 | % | |||||||||||
Six months ended June 30, (unaudited, in thousands)
| PBM | HCIT | Consolidated | |||||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||||
| Revenue | $ | 10,229,337 | $ | 6,563,748 | $ | 70,950 | $ | 73,399 | $ | 10,300,287 | $ | 6,637,147 | |||||||||||
| Cost of revenue | 9,622,564 | 6,089,312 | 33,249 | 34,873 | 9,655,813 | 6,124,185 | |||||||||||||||||
| Gross profit | $ | 606,773 | $ | 474,436 | $ | 37,701 | $ | 38,526 | $ | 644,474 | $ | 512,962 | |||||||||||
| Gross profit % | 5.9 | % | 7.2 | % | 53.1 | % | 52.5 | % | 6.3 | % | 7.7 | % | |||||||||||
Revenue
PBM revenue increased $2.0 billion, or 58%, to $5.4 billion in Q2 2014,
compared to $3.4 billion in Q2 2013. Revenue increased $3.7 billion, or
56% to $10.2 billion for the year to date ("YTD") period ended June 30,
2014, compared to $6.6 billion for the same period in 2013. The
increases in both periods are mainly due to organic growth driven by
increased claim volume added through new customer implementations,
including the continued implementation of the Cigna contract, as well
as additional claim volume related to the Restat acquisition.
Additionally, revenues have increased in both periods as a result of
increased specialty claim volume, which carries a higher revenue per
claim rate compared to the Company's general book of business.
HCIT revenue decreased $0.4 million, or 1%, to $34.8 million in Q2 2014, compared to $35.2 million in Q2 2013. HCIT revenue decreased $2.4 million, or 3%, to $71.0 million for the YTD period ended June 30, 2014, compared to $73.4 million for the same period in 2013. These decreases in the quarterly and YTD periods were primarily due to lower professional services revenue.
Gross Profit
Gross profit for Q2 2014 increased $65.2 million, or 25%, to $329.8
million, compared to $264.6 million in Q2 2013. Gross profit for the
YTD period ended June 30, 2014 increased $131.5 million, or 26%, to
$644.5 million, compared to $513.0 million for the same period in 2013.
The increases during both periods are mostly due to the successful
implementations of new customer contracts in 2014. Gross profit
percentage decreased to 6% of revenue in Q2 2014, from 8% of revenue in
Q2 2013. The YTD gross profit percentage decreased to 6% of revenue
from 8% of revenue during the YTD period ended June 30, 2014, compared
to the same period in 2013. The decreases are mainly due to the large
Cigna volume carrying a significantly lower gross profit percentage per
claim compared to the historical PBM business.
Selling, General and Administrative ("SG&A") Costs
SG&A costs for Q2 2014 increased $26.7 million, or 27%, to $126.6
million, compared to $99.9 million in Q2 2013. SG&A costs for the YTD
period ended June 30, 2014 increased $56.8 million, or 28%, to $257.2
million, compared to $200.4 million for the YTD period ended June 30,
2013. These increases are mainly due to the addition of Restat
operating expenses and additional resources needed to support the
growth of the PBM business.
Amortization
Amortization of intangible assets for Q2 2014 increased $4.9 million, or
10%, to $55.0 million, compared to $50.1 million in Q2 2013.
Amortization of intangible assets for the YTD period ended June 30,
2014 increased $9.8 million or 10% to $110.0 million, compared to
$100.1 million in the YTD period ended June 30, 2014. These increases
are mainly driven by the amortization of intangible assets from the
acquisition of Restat.
Interest and Other Expense, Net
Interest and other expense, net for Q2 2014 increased $4.7 million to
$15.6 million compared to $10.9 million in Q2 2013. Interest and other
expense, net for the YTD period ended June 30, 2014 increased $5.0
million to $27.0 million compared to $21.9 million for the same period
in 2013. The increases during both periods are mainly due to higher
average principal amount of long-term debt outstanding resulting from
the issuance in March 2014 of $500 million aggregate principal amount
of 4.75% senior notes.
Income Taxes
The Company recognized income tax expense of $33.2 million for Q2 2014,
representing an effective tax rate of 28%, compared to $24.6 million,
representing an effective tax rate of 26%, for the same period in 2013.
The Company recognized income tax expense of $61.3 million for the YTD
period ended June 30, 2014, representing an effective tax rate of 27%,
compared to $47.6 million, representing an effective tax rate of 27%,
for the same period in 2013. The increases during both periods in
income tax expense were mainly due to higher taxable income compared to
the same periods in 2013.
Net Income and EPS Attributable to the Company
The Company reported Q2 2014 net income attributable to the Company of
$71.4 million, or $0.34 per share (fully-diluted), compared to $63.4
million, or $0.31 per share (fully-diluted), in Q2 2013. The Company
reported YTD period ended June 30, 2014 net income attributable to the
Company of $134.9 million or $0.65 per share (fully-diluted), compared
to $114.8 million, or $0.56 per share (fully-diluted), for the same
period in 2013. Net income attributable to the Company increased during
both periods mainly due to increased revenue as a result of new
customer implementations and additional income generated as a result of
the Restat acquisition. These increases were partially offset by
increases in SG&A expense, interest expense and amortization of
intangible assets.
Q2 2014 Adjusted EPS¹ (fully-diluted), which excludes all amortization of intangible assets of $55.0 million, net of tax, increased 10% to $0.54 per share (fully-diluted) in Q2 2014, compared to $0.49 per share (fully-diluted) in Q2 2013. YTD 2014 Adjusted EPS (fully-diluted), which excludes all amortization of intangible assets of $110.0 million, net of tax, increased 14% to $1.04 per share (fully-diluted) in YTD 2014.
EBITDA¹
Q2 2014 EBITDA increased $30.4 million, or 19%, to $188.5 million,
compared to $158.1 million in Q2 2013. YTD 2014 EBITDA increased $57.8
million, or 19%, to $359.4 million, compared to $301.6 million in YTD
2013. The increases during both periods are mainly due to increased net
income attributable to the Company as a result of increased revenue, as
noted previously. These increases were partially offset by increased
SG&A costs due to the acquisition of Restat and additional resources
added to support the growth of the PBM business.
Cash Flow
For Q2 2014, the Company generated $57.2 million of cash from
operations, compared to $173.0 million of cash during the same period
in 2013. For YTD 2014, the Company generated $192.9 million of cash
from operations, compared to $236.3 million of cash during the same
period in 2013. Cash from operations decreased during both periods
primarily due to an increase in inventory purchases in 2014 compared to
the same periods in 2013 driven by the increase in the Company's mail
and specialty pharmacy claim volume. Additionally, during the YTD
period the Company generated approximately $164.3 million in cash from
financing activities due to the issuance of $500 million in senior
notes, offset by repaying $300 million of outstanding debt under the
Company's revolving credit facility.
2014 Full Year Financial Guidance
With today's announcement, the Company is updating its 2014 full year
financial guidance:
- Revenue of $20.5 to $21.0 billion
- EBITDA1 of $770 to $800 million
- GAAP EPS (fully-diluted) of $1.40 to $1.50
- Adjusted EPS1 (fully-diluted) of $2.12 to $2.22 (excluding all amortization of intangible assets)
Notice of Conference Call
Catamaran will host a conference call on Friday, August 1, 2014, at 8:30
a.m. ET to discuss its financial results. Mark Thierer, Chairman and
CEO, and Mike Shapiro, SVP and CFO, will co-chair the call. This call
is being webcast and can be accessed from the IR Events page of the
Catamaran Corporation web site at www.catamaranrx.com. An archived replay of the webcast will be available for 90 days.
1Non-GAAP Financial Measures
Catamaran reports its financial results in accordance with generally accepted accounting principles in the United States ("GAAP"). Catamaran's management also evaluates and makes operating decisions using various other measures. Two such measures are Adjusted EPS and EBITDA, which are non-GAAP financial measures. Catamaran's management believes that these two measures provide useful supplemental information regarding the performance of Catamaran's business operations.
Adjusted EPS adds back the impact of all intangible asset amortization expense, net of tax. Amortization of intangible asset expense arises from the acquisition of intangible assets in connection with the Company's acquisitions. The Company excludes intangible asset amortization expense from EPS because it believes (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of Catamaran's business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired intangible assets. Investors should note that the use of these intangible assets contributes to revenue in the periods presented as well as future periods and should also note that such expenses will recur in future periods.
EBITDA is a non-GAAP measure that management believes is a useful supplemental measure of operating performance. EBITDA consists of earnings attributable to the Company prior to depreciation, amortization, interest and other expense, net, income taxes and adjustments to remove the applicable impact of any non-controlling interest. Management believes it is useful to exclude these items as they are essentially amounts that cannot be influenced by management in the short term.
The 2014 full year EBITDA guidance was computed using the Company's estimated 2014 earnings attributable to the Company prior to depreciation, amortization, interest and other expense, net, income taxes and adjustments to remove the applicable impact of any non-controlling interest. The 2014 full year Adjusted EPS guidance was computed by taking the Company's GAAP EPS (fully-diluted) guidance and adding back the expected impact of all 2014 amortization of intangible asset expense totaling approximately $210 to $215 million, net of estimated income taxes (expected effective tax rate of approximately 28%).
Adjusted prescription claim volume equals Catamaran's mail service prescriptions multiplied by three, plus its retail and specialty prescriptions. The mail service prescriptions are multiplied by three to adjust for the fact that they typically include approximately three times the amount of product days supplied compared with retail prescriptions.
Management believes that Adjusted EPS, EBITDA and adjusted prescription claim volume provide useful supplemental information to management and investors regarding the performance of the Company's business operations and facilitate comparisons to its historical operating results. Management also uses this information internally for forecasting and budgeting as it believes that the measures are indicative of the Company's core operating results. Note, however, that these items are performance measures only, and do not provide any measure of the Company's cash flow or liquidity. Non-GAAP financial measures should not be considered as a substitute for measures of financial performance in accordance with GAAP, and investors and potential investors are encouraged to review the reconciliations of Adjusted EPS and EBITDA to their most directly comparable GAAP measure.
Adjusted EPS and EBITDA do not have standardized meanings prescribed by GAAP. The Company's method of calculating these items may differ from the methods used by other companies and, accordingly, may not be comparable to similarly titled measures used by other companies.
| EBITDA Reconciliation | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
| (in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||
| (unaudited) | (unaudited) | ||||||||||||||
| Net income attributable to the Company (GAAP) | $ | 71,432 | $ | 63,421 | $ | 134,877 | $ | 114,826 | |||||||
| Add: | |||||||||||||||
| Depreciation of property and equipment | 14,019 | 9,042 | 27,378 | 17,145 | |||||||||||
| Amortization of intangible assets | 54,977 | 50,092 | 109,963 | 100,148 | |||||||||||
| Interest and other expense, net | 15,626 | 10,907 | 26,962 | 21,946 | |||||||||||
| Income tax expense | 33,241 | 24,607 | 61,349 | 47,635 | |||||||||||
| Adjustments related to non-controlling interest | (791) | (6) | (1,176) | (98) | |||||||||||
| EBITDA | $ | 188,504 | $ | 158,063 | $ | 359,353 | $ | 301,602 | |||||||
| Adjusted EPS Reconciliation | ||||||||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||||||
| Operational Results | Per Diluted Share | Operational Results | Per Diluted Share | Operational Results | Per Diluted Share | Operational Results | Per Diluted Share | |||||||||||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||||||||||
| Net income attributable to the Company (GAAP) | $ | 71,432 | $ | 0.34 | $ | 63,421 | $ | 0.31 | $ | 134,877 | $ | 0.65 | $ | 114,826 | $ | 0.56 | ||||||||||||||||
| Amortization of intangible assets | 54,977 | 0.27 | 50,092 | 0.24 | 109,963 | 0.53 | 100,148 | 0.48 | ||||||||||||||||||||||||
| Tax effect of reconciling item | (15,284) | (0.07) | (12,874) | (0.06) | (30,020) | (0.14) | (27,140) | (0.13) | ||||||||||||||||||||||||
| Non-GAAP net income attributable to the Company | $ | 111,125 | $ | 0.54 | $ | 100,639 | $ | 0.49 | $ | 214,820 | $ | 1.04 | $ | 187,834 | $ | 0.91 | ||||||||||||||||
About Catamaran Corporation
Catamaran, the industry's fastest-growing pharmacy benefits manager,
helps organizations and the communities they serve take control of
prescription drug costs. Managing more than 350 million prescriptions
each year on behalf of over 32 million members, our flexible, holistic
solutions improve patient care and empower individuals to take charge
of their health. Processing one in every five prescription claims in
the U.S., Catamaran's skill and scale deliver compelling financial
results and sustainable improvement in the overall health of members.
Catamaran is headquartered in Schaumburg, IL., with multiple locations
in the U.S. and Canada. For more information, please visit Catamaranrx.com, and for industry news and information follow Catamaran on Twitter, @CatamaranCorp.
Forward-Looking Statements
Certain statements included herein, including guidance and those that
express management's objectives and the strategies to achieve those
objectives, as well as information with respect to the Company's
beliefs, plans, expectations, anticipations, estimates and intentions,
constitute "forward-looking statements" within the meaning of
applicable securities laws. Forward-looking statements are necessarily
based upon a number of estimates and assumptions that, while considered
reasonable by management at this time, are inherently subject to
significant business, economic and competitive uncertainties and
contingencies. We caution that such forward-looking statements involve
known and unknown risks, uncertainties and other risks that may cause
our actual financial results, performance, or achievements to be
materially different from our estimated future results, performance or
achievements expressed or implied by those forward-looking statements.
Numerous factors could cause actual results to differ materially from
those in the forward-looking statements, including without limitation,
our ability to achieve increased market acceptance for our product
offerings and penetrate new markets; our ability to compete
successfully; our dependence on, and ability to retain, key customers;
customer demands for enhanced services levels or loss or unfavorable
modification with our customers; the risks and challenges associated
with our PBM partnering agreement with Cigna Corporation due to the
size of the client and the complexity and long-term nature of the agreement; consolidation in the healthcare industry; our ability
to identify and complete acquisitions, manage our growth, integrate
acquisitions and achieve expected synergies from acquisitions; changes
in industry pricing benchmarks and continuing market and economic
challenges; our ability to maintain our relationships with pharmacy
providers, pharmaceutical manufacturers, third-party rebate
administrators and suppliers; compliance with existing laws,
regulations and industry initiatives and future change in laws or
regulations in the healthcare industry; our ability to maintain our
relationships with suppliers; the outcome of any legal or tax
proceeding that has been or may be instituted against us; the existence
of undetected errors or similar problems in our software products;
potential liability for the use of incorrect or incomplete data;
interruption of our operations due to outside sources and breach of our
security by third parties; our dependence on the expertise of our
senior management and other personnel; maintaining our intellectual
property rights and litigation involving intellectual property rights;
our ability to obtain, use or successfully integrate third-party
licensed technology; our ability to accurately forecast our financial
results; our level of indebtedness and the covenants and restrictions
in the agreements governing our outstanding indebtedness; our access to
sufficient capital to fund our future requirements; potential
write-offs of goodwill or other intangible assets; and the material
weakness identified in our internal control over financial reporting.
The foregoing list of factors is not exhaustive and is subject to
change and there can be no assurance that such assumptions will reflect
the actual outcome of such items or factors. Other factors that should
be considered are discussed from time to time in Catamaran's filings
with the U.S. Securities and Exchange Commission, including the risks
and uncertainties discussed under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" in our Annual Report on Form 10-K and subsequent
filings with the U.S. Securities and Exchange Commission, which are
available at www.sec.gov.
When relying on forward-looking information to make decisions, investors
and others should carefully consider the foregoing factors and other
uncertainties and potential events. In making the forward-looking
statements contained herein, the Company does not assume any future
significant acquisitions, dispositions or one-time items. It does
assume, however, the renewal of certain customer contracts. Every year,
the Company has major customer contracts that come up for renewal. In
addition, the Company also assumes new customer contracts. In this
regard, the Company is pursuing large opportunities that present a very
long and complex sales cycle which substantially affects its
forecasting abilities. The Company has assumed certain timing for the
realization of these opportunities which it believes is reasonable but
which may not be achieved. Furthermore, the pursuit of these larger
opportunities does not ensure a linear progression of revenue and
earnings since they may involve significant up- front costs followed by
renewals and cancellations of existing contracts. The Company has
assumed certain revenues which may not be realized. The Company has
also assumed that the material factors referred to in the previous
paragraph will not cause such forward-looking information to differ
materially from actual results or events. There can be no assurance
that such assumptions will reflect the actual outcome of such items or
factors. Accordingly, investors are cautioned not to put undue reliance
on forward-looking statements. All subsequent written and oral
forward-looking statements attributable to Catamaran or persons acting
on our behalf are expressly qualified in their entirety by this notice.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS RELEASE REPRESENTS THE
COMPANY'S CURRENT EXPECTATIONS AND, ACCORDINGLY, IS SUBJECT TO CHANGE.
HOWEVER, THE COMPANY EXPRESSLY DISCLAIMS ANY INTENTION OR OBLIGATION TO
UPDATE OR REVISE ANY FORWARD-LOOKING INFORMATION, WHETHER AS A RESULT
OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE, EXCEPT AS REQUIRED BY
APPLICABLE LAW.
CATAMARAN CORPORATION
Consolidated Balance Sheets
(in thousands, except share data)
| June 30, 2014 | December 31, 2013 | ||||||
| (unaudited) | |||||||
| ASSETS | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 709,548 | $ | 387,241 | |||
| Restricted cash | 32,223 | 32,220 | |||||
| Accounts receivable, net of allowance for doubtful accounts of $4,642 (2013 - $5,860) | 1,173,606 | 959,586 | |||||
| Rebates receivable | 908,216 | 305,955 | |||||
| Other current assets | 219,519 | 152,673 | |||||
| Total current assets | 3,043,112 | 1,837,675 | |||||
| Property and equipment, net of accumulated depreciation of $131,729 (2013 - $103,858) | 198,392 | 197,007 | |||||
| Goodwill | 4,724,639 | 4,720,275 | |||||
| Other intangible assets, net of accumulated amortization of $471,246 (2013 - $363,546) | 1,071,456 | 1,181,419 | |||||
| Other long-term assets | 80,287 | 59,387 | |||||
| Total assets | $ | 9,117,886 | $ | 7,995,763 | |||
| LIABILITIES AND EQUITY | |||||||
| Current liabilities | |||||||
| Accounts payable | $ | 1,000,760 | $ | 817,805 | |||
| Accrued expenses and other current liabilities | 275,576 | 254,100 | |||||
| Rebates payable | 942,857 | 356,265 | |||||
| Current portion - long-term debt | 68,750 | 50,000 | |||||
| Total current liabilities | 2,287,943 | 1,478,170 | |||||
| Deferred income taxes | 276,664 | 301,341 | |||||
| Long-term debt | 1,379,432 | 1,215,363 | |||||
| Other long-term liabilities | 97,178 | 89,391 | |||||
| Total liabilities | 4,041,217 | 3,084,265 | |||||
| Shareholders' equity | |||||||
| Common shares: no par value, unlimited shares authorized; 207,411,365
shares issued and outstanding at June 30, 2014 (December 31, 2013 - 206,305,070 shares) | 4,261,667 | 4,215,291 | |||||
| Additional paid-in capital | 58,881 | 77,790 | |||||
| Retained earnings | 752,038 | 617,161 | |||||
| Accumulated other comprehensive loss | (1,834) | (1,752) | |||||
| Total shareholders' equity | 5,070,752 | 4,908,490 | |||||
| Non-controlling interest | 5,917 | 3,008 | |||||
| Total equity | 5,076,669 | 4,911,498 | |||||
| Total liabilities and equity | $ | 9,117,886 | $ | 7,995,763 | |||
CATAMARAN CORPORATION
Consolidated Statements of Operations
(in thousands, except share and per share data)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2014 | 2013 | 2014 | 2013 | ||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||
| Revenue | $ | 5,385,808 | $ | 3,417,430 | $ | 10,300,287 | $ | 6,637,147 | |||||||
| Cost of revenue | 5,055,995 | 3,152,841 | 9,655,813 | 6,124,185 | |||||||||||
| Gross profit | 329,813 | 264,589 | 644,474 | 512,962 | |||||||||||
| Expenses: | |||||||||||||||
| Selling, general and administrative | 126,635 | 99,888 | 257,153 | 200,386 | |||||||||||
| Depreciation of property and equipment | 13,093 | 7,938 | 25,461 | 14,908 | |||||||||||
| Amortization of intangible assets | 54,977 | 50,092 | 109,963 | 100,148 | |||||||||||
| 194,705 | 157,918 | 392,577 | 315,442 | ||||||||||||
| Operating income | 135,108 | 106,671 | 251,897 | 197,520 | |||||||||||
| Interest and other expense, net | 15,626 | 10,907 | 26,962 | 21,946 | |||||||||||
| Income before income taxes | 119,482 | 95,764 | 224,935 | 175,574 | |||||||||||
| Income tax expense | 33,241 | 24,607 | 61,349 | 47,635 | |||||||||||
| Net income | $ | 86,241 | $ | 71,157 | $ | 163,586 | $ | 127,939 | |||||||
| Less: Net income attributable to non-controlling interest | 14,809 | 7,736 | 28,709 | 13,113 | |||||||||||
| Net income attributable to the Company | $ | 71,432 | $ | 63,421 | $ | 134,877 | $ | 114,826 | |||||||
| Earnings per share attributable to the Company: | |||||||||||||||
| Basic | $ | 0.35 | $ | 0.31 | $ | 0.65 | $ | 0.56 | |||||||
| Diluted | $ | 0.34 | $ | 0.31 | $ | 0.65 | $ | 0.56 | |||||||
| Weighted average number of shares used in computing earnings per share: | |||||||||||||||
| Basic | 206,938,789 | 205,975,724 | 206,733,127 | 205,782,438 | |||||||||||
| Diluted | 207,310,851 | 206,624,432 | 207,207,122 | 206,535,143 | |||||||||||
CATAMARAN CORPORATION
Consolidated Statements of Cash Flows
(in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2014 | 2013 | 2014 | 2013 | ||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||
| Cash flows from operating activities: | |||||||||||||||
| Net income | $ | 86,241 | $ | 71,157 | $ | 163,586 | $ | 127,939 | |||||||
| Items not involving cash: | |||||||||||||||
| Stock-based compensation | 8,570 | 6,487 | 15,398 | 13,131 | |||||||||||
| Depreciation of property and equipment | 14,019 | 9,042 | 27,378 | 17,145 | |||||||||||
| Amortization of intangible assets | 54,977 | 50,092 | 109,963 | 100,148 | |||||||||||
| Deferred lease inducements and rent | 267 | 821 | 190 | 15,349 | |||||||||||
| Deferred income taxes | (13,710) | (9,135) | (26,044) | (25,787) | |||||||||||
| Tax benefit on option exercises | (1,302) | (4,549) | (3,993) | (9,479) | |||||||||||
| Deferred financing cost amortization | 2,470 | 2,373 | 4,658 | 4,866 | |||||||||||
| Changes in operating assets and liabilities, net of effects from acquisitions: | |||||||||||||||
| Accounts receivable | (42,114) | (19,608) | (214,015) | (21,271) | |||||||||||
| Rebates receivable | (240,163) | 32,966 | (602,515) | 18,413 | |||||||||||
| Restricted cash | (1) | 4 | (3) | 231 | |||||||||||
| Other current assets | (82,758) | 900 | (56,448) | 13,367 | |||||||||||
| Accounts payable | 38,671 | 11,504 | 182,933 | (22,632) | |||||||||||
| Accrued expenses and other current liabilities | (3,723) | (2,115) | 17,032 | (12,305) | |||||||||||
| Rebates payable | 223,957 | 22,461 | 586,592 | 13,787 | |||||||||||
| Other long-term assets and liabilities | 11,805 | 583 | (11,826) | 3,351 | |||||||||||
| Net cash provided by operating activities | 57,206 | 172,983 | 192,886 | 236,253 | |||||||||||
| Cash flows from investing activities: | |||||||||||||||
| Acquisition, net of cash acquired | - | (7,076) | (2,026) | (7,076) | |||||||||||
| Purchases of property and equipment | (20,091) | (46,892) | (32,873) | (72,135) | |||||||||||
| Proceeds from restricted cash | - | - | - | 20,004 | |||||||||||
| Net cash used by investing activities | (20,091) | (53,968) | (34,899) | (59,207) | |||||||||||
| Cash flows from financing activities: | |||||||||||||||
| Proceeds from issuance of debt | - | 100,000 | 492,500 | 100,000 | |||||||||||
| Repayment of long-term debt | (6,250) | (150,000) | (312,500) | (250,000) | |||||||||||
| Payment of financing costs | (1,008) | (2,347) | (1,963) | (2,347) | |||||||||||
| Proceeds from exercise of options | 1,376 | 1,145 | 4,944 | 1,928 | |||||||||||
| Proceeds from exercise of warrants | 3,453 | - | 3,453 | - | |||||||||||
| Tax benefit on option exercises | 1,302 | 4,549 | 3,993 | 9,479 | |||||||||||
| Payments of contingent consideration | - | - | - | (23,203) | |||||||||||
| Distributions to non-controlling interest | (10,800) | (10,115) | (25,800) | (10,115) | |||||||||||
| Other | (321) | - | (321) | - | |||||||||||
| Net cash (used) provided by financing activities | (12,248) | (56,768) | 164,306 | (174,258) | |||||||||||
| Effect of foreign exchange on cash balances | (34) | (15) | 14 | 24 | |||||||||||
| Increase in cash and cash equivalents | 24,833 | 62,232 | 322,307 | 2,812 | |||||||||||
| Cash and cash equivalents, beginning of period | 684,715 | 311,356 | 387,241 | 370,776 | |||||||||||
| Cash and cash equivalents, end of period | $ | 709,548 | $ | 373,588 | $ | 709,548 | $ | 373,588 | |||||||
SOURCE Catamaran
