EX-99.2 3 g13258exv99w2.htm EX-99.2 FINANCIAL TABLES ACCOMPANYING EXHIBIT 99.1 EX-99.2 FINANCIAL TABLES ACCOMPANYING EXHIBIT 99.1
 

EXHIBIT 99.2
HLTH CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
                 
    Three Months Ended  
    March 31,  
    2008     2007  
Revenue
  $ 81,682     $ 71,881  
 
               
Costs and expenses:
               
Cost of operations
    31,570       28,618  
Sales and marketing
    25,830       22,870  
General and administrative
    21,144       28,443  
Depreciation and amortization
    6,888       6,325  
Interest income
    11,936       9,674  
Interest expense
    4,607       4,709  
Gain on sale of EBS Master LLC
    538,024        
Impairment of auction rate securities
    60,108        
Transition services income, net
    50       2,456  
Other (expense) income, net
    (4,194 )     426  
 
           
Income (loss) from continuing operations before income tax provision (benefit)
    477,351       (6,528 )
Income tax provision (benefit)
    25,614       (231 )
Minority interest in WHC (loss) income
    (3,845 )     115  
Equity in earnings of EBS Master LLC
    4,007       7,099  
 
           
Income from continuing operations
    459,589       687  
Income from discontinued operations (net of tax $2,910 and $1,221 in 2008 and 2007)
    3,569       5,015  
 
           
Net income
  $ 463,158     $ 5,702  
 
           
 
               
Basic income per common share:
               
Income from continuing operations
  $ 2.52     $ 0.00  
Income from discontinued operations
    0.02       0.03  
 
           
Net income
  $ 2.54     $ 0.03  
 
           
 
               
Diluted income per common share:
               
Income from continuing operations
  $ 2.03     $ 0.00  
Income from discontinued operations
    0.01       0.03  
 
           
Net income
  $ 2.04     $ 0.03  
 
           
 
               
Weighted-average shares outstanding used in computing income per common share:
               
Basic
    182,175       176,011  
 
           
Diluted
    228,159       186,355  
 
           

 


 

HLTH CORPORATION
CONSOLIDATED SEGMENT INFORMATION
(In thousands, except per share data, unaudited)
                 
    Three Months Ended  
    March 31,  
    2008     2007  
Revenue
               
WebMD Online Services:
               
Advertising and sponsorship
  $ 56,065     $ 47,421  
Licensing
    21,923       20,115  
Content syndication and other
    417       884  
 
           
Total WebMD Online Services
    78,405       68,420  
WebMD Publishing and Other Services
    3,277       3,524  
Inter-segment eliminations
          (63 )
 
           
 
  $ 81,682     $ 71,881  
 
           
 
Earnings (loss) before interest, taxes, non-cash and other items (“Adjusted EBITDA”)
               
WebMD Online Services
  $ 16,531     $ 12,992  
WebMD Publishing and Other Services
    (754 )     (358 )
Corporate
    (5,059 )     (6,726 )
 
           
 
  $ 10,718     $ 5,908  
 
               
Adjusted EBITDA per diluted common share (a)
  $ 0.05     $ 0.03  
 
           
 
               
Interest, taxes, non-cash and other items (b)
               
Depreciation and amortization
  $ (6,888 )   $ (6,325 )
Non-cash stock-based compensation
    (5,972 )     (9,182 )
Non-cash advertising
    (1,558 )     (2,320 )
Interest income
    11,936       9,674  
Interest expense
    (4,607 )     (4,709 )
Gain on sale of EBS Master LLC
    538,024        
Income tax (provision) benefit
    (25,614 )     231  
Minority interest in WHC loss (income)
    3,845       (115 )
Equity in earnings of EBS Master LLC
    4,007       7,099  
Impairment of auction rate securities
    (60,108 )      
Other (expense) income, net
    (4,194 )     426  
 
           
Income from continuing operations
    459,589       687  
Income from discontinued operations, net of tax
    3,569       5,015  
 
           
Net income
  $ 463,158     $ 5,702  
 
           
 
               
Basic income per common share:
               
Income from continuing operations
  $ 2.52     $ 0.00  
Income from discontinued operations
    0.02       0.03  
 
           
Net income
  $ 2.54     $ 0.03  
 
           
 
               
Diluted income per common share:
               
Income from continuing operations
  $ 2.03     $ 0.00  
Income from discontinued operations
    0.01       0.03  
 
           
Net income
  $ 2.04     $ 0.03  
 
           
 
               
Weighted-average shares outstanding used in computing income per common share:
               
Basic
    182,175       176,011  
 
           
Diluted
    228,159       186,355  
 
           
 
(a)   Adjusted EBITDA per diluted common share is based on the weighted-average shares outstanding used in computing diluted income per common share.
 
(b)   Reconciliation of Adjusted EBITDA to net income (see Annex A — Explanation of Non-GAAP Financial Measures).

 


 

HLTH CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
                 
    Three Months Ended  
    March 31,  
    2008     2007  
Cash flows from operating activities:
               
Net income
  $ 463,158     $ 5,702  
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
               
Income from discontinued operations, net of tax
    (3,569 )     (5,015 )
Depreciation and amortization
    6,888       6,325  
Minority interest in WHC (loss) income
    (3,845 )     115  
Equity in earnings of EBS Master LLC
    (4,007 )     (7,099 )
Amortization of debt issuance costs
    743       721  
Non-cash advertising
    1,558       2,320  
Non-cash stock-based compensation
    5,972       9,182  
Deferred income taxes
    5,389       2  
Gain on sale of EBS
    (538,024 )     (399 )
Impairment of auction rate securities
    60,108        
Changes in operating assets and liabilities:
               
Accounts receivable
    12,220       2,185  
Prepaid expenses and other, net
    17,493       421  
Accrued expenses and other long-term liabilities
    10,320       (46,158 )
Deferred revenue
    11,714       7,678  
 
           
Net cash provided by (used in) continuing operations
    46,118       (24,020 )
Net cash (used in) provided by discontinued operations
    (3,751 )     6,712  
 
           
Net cash provided by (used in) operating activities
    42,367       (17,308 )
 
               
Cash flows from investing activities:
               
Proceeds from maturities and sales of available-for-sale securities
    104,518       67,922  
Purchases of available-for-sale securities
    (177,150 )     (65,932 )
Purchases of property and equipment
    (2,662 )     (4,780 )
Proceeds related to sales of EBS, EPS and ACS/ACP, net of fees
    598,935       2,898  
Decrease in net advances to EBS Master LLC
    1,195       19,691  
 
           
Net cash provided by continuing operations
    524,836       19,799  
Net cash used in discontinued operations
    (1,438 )     (847 )
 
           
Net cash provided by investing activities
    523,398       18,952  
 
               
Cash flows from financing activities:
               
Proceeds from issuance of HLTH and WHC common stock
    1,777       63,404  
Purchases of treasury stock under repurchase program
          (11,322 )
 
           
Net cash provided by continuing operations
    1,777       52,082  
Net cash used in discontinued operations
    (46 )     (43 )
 
           
Net cash provided by financing activities
    1,731       52,039  
Effect of exchange rates on cash
    1,753       184  
 
           
Net increase in cash and cash equivalents
    569,249       53,867  
Cash and cash equivalents at beginning of period
    536,879       614,691  
 
           
Cash and cash equivalents at end of period
  $ 1,106,128     $ 668,558  
 
           

 


 

HLTH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)
                 
    March 31, 2008     December 31, 2007  
Assets
               
Cash and cash equivalents
  $ 1,106,128     $ 536,879  
Marketable securities
    309,256       290,858  
Accounts receivable, net
    73,861       86,081  
Due from EBS Master LLC
    28       1,224  
Prepaid expenses and other current assets
    27,781       71,090  
Assets of discontinued operations
    266,591       262,964  
 
           
Total current assets
    1,783,645       1,249,096  
 
               
Marketable equity securities
    2,036       2,383  
Property and equipment, net
    47,883       49,554  
Goodwill
    214,623       217,323  
Intangible assets, net
    33,766       36,314  
Investment in EBS Master LLC
          25,261  
Other assets
    59,922       71,466  
 
           
Total Assets
  $ 2,141,875     $ 1,651,397  
 
           
 
               
Liabilities and Stockholders’ Equity
               
Accrued expenses
  $ 59,002     $ 49,598  
Deferred revenue
    88,114       76,401  
Liabilities of discontinued operations
    113,397       123,131  
 
           
Total current liabilities
    260,513       249,130  
 
               
Convertible notes
    650,000       650,000  
Other long-term liabilities
    21,214       21,137  
 
               
Minority interest in WHC
    130,231       131,353  
 
               
Stockholders’ equity
    1,079,917       599,777  
 
               
 
           
Total Liabilities and Stockholders’ Equity
  $ 2,141,875     $ 1,651,397