Precis Announces Second Quarter 2005 Financial Results
August 15 2005 - 4:00PM
PR Newswire (US)
GRAND PRAIRIE, Texas, Aug. 15 /PRNewswire-FirstCall/ -- Precis Inc.
(NASDAQ:PCIS), a provider of access to affordable healthcare
services to the ever growing number of uninsured and/or
underinsured in the United States, announced its financial results
for the quarter ended June 30, 2005. For the second quarter, the
price of the company's stock declined significantly, necessitating
an impairment analysis of the fair value of goodwill related to one
of the company's subsidiaries, The Capella Group, Inc. The result
of that impairment analysis is a non-cash charge to earnings of
$9,900,000 to reduce the carrying value of that goodwill. As the
result of that charge, the company reported a loss for the second
quarter of $10,826,000 or $(0.89) per diluted share. The company
reported revenue of $8,037,000, a decrease of $1,366,000, or 14.5%,
compared to $9,403,000 during the comparable quarter in 2004 and a
decrease of $663,000 or 7.6% compared to $8,700,000 during the
first quarter of 2005. The company's net loss for the second
quarter of 2005 also included a charge of $800,000 during the
quarter for officer severance payments. Despite the loss, the
company's operations provided net cash of $909,000 for the second
quarter, and the company ended the quarter with $7,778,000 of cash
and no debt. Nicholas Zaffiris, Chairman of the Board of Precis
Inc., commented, "While the goodwill impairment charge and the
severance charge result in a significant net loss, I am nonetheless
pleased with the progress that we made this quarter in effecting
the transition to our new management team. Cost reductions to which
our Board of Directors has been previously committed were largely
achieved. We continue to vigorously pursue new marketing
initiatives, including the launch of our nutraceuticals line of
products." "With respect to the lawsuit filed against us by the
State of Texas, we are meeting with representatives of the Attorney
General's office and remain hopeful that we can resolve this matter
in the near future," Mr. Zaffiris concluded. Precis Inc.
(NASDAQ:PCIS) will conduct a conference call to discuss financial
results for the second quarter ended June 30, 2005 on Monday,
August 15, 2005 at 4:00 p.m. Eastern time. Interested parties can
access the call by dialing 877-407-8035 or 201-689-8035 or by
accessing the web cast at:
http://www.vcall.com/CEPage.asp?ID=94034. A replay of the call will
be available at 877-660-6853 or 201-612-7415, account number 286
and conference ID 165550, for 7 days following the call; and the
web cast can be accessed at
http://www.vcall.com/CEPage.asp?ID=94034 for 30 days. About Precis
Inc. Precis Inc. and its subsidiaries market non-insurance health
care savings programs, administer tax-favored reimbursement
accounts, and provide third party administration services to self
funded employer groups. For more information on Precis, its
subsidiaries Care 125 and Access Administrators visit
http://www.precis-pcis.com/, http://www.care125.com/ and
http://www.accesshealthsource.com/ respectively. Disclaimer Certain
statements included in this news release constitute
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended. Certain, but not
necessarily all, of such forward-looking statements can be
identified by the use of forward-looking terminology such as
"anticipate," "believes," "expects," "may," "will," or "should," or
other variations thereon, by discussions of strategies that involve
risks and uncertainties. Precis Inc.'s actual results or industry
results may be materially different from any future results
expressed or implied by such forward-looking statements. Factors
that could cause actual results to differ materially include
general economic and business conditions; Precis Inc.'s ability to
implement its business strategies; competition; availability of key
personnel; increasing operating costs; unsuccessful promotional
efforts; changes in brand awareness; acceptance of new product
offerings; retention of members and independent marketing
representatives; and changes in, or the failure to comply with,
government regulations. The Company undertakes no obligation to
update any forward-looking statements or to make any other
forward-looking statement, whether as a result of new information,
future events, or otherwise. Contact: Bob Bintliff Joe Diaz Chief
Financial Officer The RCG Group Precis Inc. 480-675-0400
972-343-6501 Precis Inc. and Subsidiaries Condensed Consolidated
Statement of Operations and Balance Sheet Data Dollars in
Thousands, except per share amounts For the Three Months For the
Six Months Ended Ended June 30, June 30, 2005 2004 2005 2004
Statement of Operations Data: Product and service revenues $8,037
$9,403 $16,737 $19,349 Total operating expenses 18,906 8,801 27,700
17,630 Operating (loss) income (10,869) 602 (10,963) 1,719 (Loss)
earnings before income taxes (10,843) 580 (10,924) 1,669 (Benefit)
provision for income taxes (17) 292 (47) 775 Net (loss) earnings
applicable to shareholders $(10,826) $288 $(10,877) $894 (Loss)
earnings applicable to shareholders per share: Basic $(0.89) $0.02
$(0.90) $0.08 Diluted $(0.89) $0.02 $(0.90) $0.07 June 31, December
31, 2005 2004 Balance Sheet Data: Cash and cash equivalents $7,778
$8,283 Working capital $4,579 $6,345 Total assets $33,341 $41,975
Total liabilities $11,658 $9,606 Stockholders' equity $21,683
$32,369 http://www.vcall.com/CEPage.asp?ID=94034DATASOURCE: Precis
Inc. CONTACT: Bob Bintliff, Chief Financial Officer of Precis Inc.,
+1-972-343-6501; or Joe Diaz of The RCG Group, +1-480-675-0400, for
Precis Inc. Web site: http://www.precis-pcis.com/
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