BioScrip Timely Files Annual Form 10-K, Concludes Accounting Review and Provides Update on Immaterial Financial Statement Corrections
As disclosed on the Company’s Form 10-K filed today with the
Year Ended December 31, 2017 | ||||||||
In $000s | March 8, 2018 Press Release |
Corrections |
Reduction in Bonus Expense |
As Disclosed in 10-K |
||||
Net revenue | 817,190 | — | — | 817,190 | ||||
Gross profit | 271,331 | (2,089 | ) | — | 269,242 | |||
Total operating expenses | 270,125 | (1) 594 | (150 | ) | 270,569 | |||
Interest expense | 52,357 | (285 | ) | — | 52,072 | |||
Income tax benefit | 3,900 | 230 | — | 4,130 | ||||
(Loss) income from continuing operations, net of income taxes | (61,285 | ) | (2,168 | ) | 150 | (63,303 | ) | |
(Loss) income from discontinued operations, net of income taxes | (1,320 | ) | 427 | — | (893 | ) | ||
Net (loss) income | (62,605 | ) | (1,741 | ) | 150 | (64,196 | ) | |
Adjusted EBITDA | 45,023 | (166 | ) | 150 | 45,007 |
(1) The following operating expenses decreased: Other operating expenses
“BioScrip concluded its previously announced management-initiated accounting review and corrected certain immaterial errors in the Company’s financial statements,” said
Additionally, the following table sets forth the effect of immaterial corrections to the Company’s 2016 and 2015 statements of operations, as reported on the Company’s Form 10-K:
Year Ended December 31, 2016 | Year Ended December 31, 2015 | ||||||||||||||||||||||||
In $000s | Previously Reported |
Corrections | As Revised | Previously Reported |
Corrections | As Revised | |||||||||||||||||||
Net revenue | 935,589 | — | 935,589 | 982,223 | — | 982,223 | |||||||||||||||||||
Gross profit | 265,631 | (3,549 | ) | 262,082 | 260,915 | (963 | ) | 259,952 | |||||||||||||||||
Total operating expenses | 263,702 | (1,081 | ) | 262,621 | 548,562 | 803 | 549,365 | ||||||||||||||||||
Interest expense | 38,235 | (663 | ) | 37,572 | 37,313 | (375 | ) | 36,938 | |||||||||||||||||
Loss from continuing operations, net of income taxes |
(34,367 | ) | (1,805 | ) | (36,172 | ) | (303,428 | ) | (1,391 | ) | (304,819 | ) | |||||||||||||
(Loss) income from discontinued operations, net of income taxes |
(7,139 | ) | 546 | (6,593 | ) | 3,721 | 970 | 4,691 | |||||||||||||||||
Net loss | (41,506 | ) | (1,259 | ) | (42,765 | ) | (299,707 | ) | (421 | ) | (300,128 | ) | |||||||||||||
Adjusted EBITDA |
30,852 | (2,156 | ) | 28,696 | 15,864 | (1,645 | ) | 14,219 |
The following table sets forth the effect of immaterial corrections to the Company’s 2016 balance sheet, as reported on the Company’s Form 10-K:
Year Ended December 31, 2016 | |||||||||||
In $000s | Previously Reported |
Corrections |
As Revised |
||||||||
Total assets | 607,740 | (2,755 | ) | 604,985 | |||||||
Total liabilities | 567,301 | (697 | ) | 566,604 | |||||||
Additional paid-in capital | 611,844 | (162 | ) | 611,682 | |||||||
Accumulated deficit | (643,419 | ) | (1,896 | ) | (645,315 | ) | |||||
Total stockholders' equity | (31,563 | ) | (2,058 | ) | (33,621 | ) | |||||
Total liabilities and stockholders' equity | 607,740 | (2,755 | ) | 604,985 |
About
Investor Contacts
Stephen Deitsch
Chief Financial Officer & Treasurer
T: (720) 697-5200
stephen.deitsch@bioscrip.com
The
T: (212) 836-9614
kahl@equityny.com
Forward-Looking Statements – Safe Harbor
This press release includes statements that may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including the statements regarding guidance, projections of certain measures of the Company's results of operations, projections of future levels of certain charges and expenses, incremental cost structure improvements and other statements regarding the Company's financial improvement plan and strategy and anticipated effects of the Cures Act. You can identify these statements by the fact that they do not relate strictly to historical or current facts. In some cases, forward-looking statements can be identified by words such as "may," "should," "could," "anticipate," "estimate," "expect," "project," "outlook," "aim," "intend," "plan," "believe," "predict," "potential," "continue" or comparable terms. Because such statements inherently involve risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward-looking statements as a result of various factors. Important factors that could cause actual results to differ materially from those in the forward-looking statement include but are not limited to risks associated with: the Company’s ability to make principal and interest payments on our debt and unsecured notes and satisfy the other covenants contained in its debt agreements; the Company’s ability to grow its core Infusion revenues; the Company's ability to continue to execute its financial improvement plan to reduce operating costs and focus its business on its Infusion Services segment; the Company’s ability to evaluate opportunities for improvement and implement solutions as part of its strategic review process; the success of the Company’s initiatives to mitigate the impact of the Cures Act on its business; reductions in federal, state and commercial reimbursement for the Company's products and services; increased government regulation related to the health care and insurance industries; as well as the risks described in the Company's periodic filings with the
Note Regarding Use of Non-GAAP Financial Measures
In addition to reporting financial information in accordance with generally accepted accounting principles (GAAP), the Company is also reporting Adjusted EBITDA, which is a non-GAAP financial measure. Adjusted EBITDA is not a measurement of financial performance under GAAP and should not be used in isolation or as a substitute or alternative to net income, operating income or any other performance measure derived in accordance with GAAP, or as a substitute or alternative to cash flow from operating activities or a measure of the Company’s liquidity. In addition, the Company's definition of Adjusted EBITDA may not be comparable to similarly titled non-GAAP financial measures reported by other companies. Adjusted EBITDA, as defined by the Company, represents net income before net interest expense, income tax expense, depreciation and amortization, impairment of goodwill, stock-based compensation expense, and restructuring, integration and other expenses. As part of restructuring, the Company may incur significant charges such as the write down of certain long−lived assets, temporary redundant expenses, retraining expenses, potential cash bonus payments and potential accelerated payments or terminated costs for certain of its contractual obligations. Management believes that Adjusted EBITDA provides useful supplemental information regarding the performance of BioScrip’s business operations and facilitates comparisons to the Company’s historical operating results. For a full reconciliation of Adjusted EBITDA to the most comparable GAAP financial measure, please see the attachment to this earnings release.
RECONCILIATION BETWEEN GAAP AND NON-GAAP MEASURES
(in thousands)
Twelve Months Ended | |||||||||||
12/31/2017 |
12/31/2016 |
12/31/2015 |
|||||||||
Income (loss) from continuing operations, net of income taxes |
$ (63,303 | ) | $ (36,172 | ) | $ (304,819 | ) | |||||
Interest expense, net | (52,072 | ) | (37,572 | ) | (36,938 | ) | |||||
Loss on extinguishment of debt | (13,453 | ) | — | — | |||||||
(Loss) gain on dispositions | (581 | ) | 3,954 | — | |||||||
Income tax benefit (expense) | 4,130 | (2,015 | ) | 21,532 | |||||||
Depreciation and Amortization expense | (27,725 | ) | (22,025 | ) | (22,864 | ) | |||||
Impairment of goodwill | — | — | (251,850 | ) | |||||||
Stock-based compensation expense | (2,360 | ) | (1,801 | ) | (4,513 | ) | |||||
Change in fair value of equity linked liabilities | (3,587 | ) | 10,450 | — | |||||||
Acquisition, integration, restructuring, and other expenses, net |
(12,662 | ) | (15,859 | ) | (24,405 | ) | |||||
Consolidated Adjusted EBITDA | $ 45,007 | $ 28,696 | $ 14,219 |
Source: BioScrip, Inc.