EX-99.2 3 0003.txt 4TH QUARTER FINANCIAL INFORMATION/EXPRESS SCRIPTS EXHIBIT 99.2 EXPRESS SCRIPTS, INC. Table 1 Unaudited Operating Statistics (in thousands, except per claim, per member and percentage data)
------------------------------------------------ -------------------------------------------------- Three months ended Year ended December 31, December 31, ------------------------------------------------ -------------------------------------------------- 2000 1999 % Var. 2000 1999 % Var. -------------- --------------- ----------- --------------- --------------- ----------- Drug Spending Drug spend, excl. UHC $ 2,999,854 $ 2,663,853 12.6% $ 11,198,727 $ 8,738,648 28.2% UHC 79,142 866,005 -90.9% 2,675,964 2,421,741 10.5% --------------- --------------- -------------- --------------- Total $ 3,078,996 $ 3,529,858 -12.8% 13,874,691 11,160,389 24.3% ============== =============== =============== =============== Revenue Detail PBM revenues (1) $ 1,899,052 $ 1,289,872 47.2%(2) $ 6,698,820 $ 4,222,294 58.7%(2) Non-PBM revenues 22,447 18,900 18.8%(3) 88,044 65,810 33.8%(3) --------------- --------------- -------------- --------------- Total revenues $ 1,921,499 $ 1,308,772 46.8% $ 6,786,864 $ 4,288,104 58.3% ============== =============== =============== =============== Per Claim Network revenue/claim $ 20.50 $ 10.84 89.1%(2) $ 16.28 $ 11.12 46.4% Mail revenue/claim 119.97 108.36 10.7% 115.77 106.13 9.1% Claims Detail Network, excl. UHC 66,469 63,512 4.7% 241,819 211,318 14.4% Mail 4,061 3,180 27.7% 15,183 10,608 43.1% -------------- --------------- --------------- --------------- Total claims,excl. UHC 70,530 66,692 5.8% 257,002 221,926 15.8% UHC claims 1,585 21,793 -92.7% 57,765 62,591 -7.7% -------------- --------------- --------------- --------------- Total claims 72,115 88,485 -18.5% 314,767 284,517 10.6% =============== =============== =============== ============== Adjusted claims (4) 80,237 94,845 -15.4% 345,133 305,733 12.9% ============== =============== =============== =============== Membership Detail (5) Members, excl. UHC 43,500 38,500 13.0% UHC members - 9,500 N/A -------------- --------------- Total members, incl. UHC 43,500 48,000 -9.4% ============== =============== Avg.members, incl. UHC 42,750 47,500 -10.0% 45,575 41,000 11.2% ============== =============== =============== =============== Per Avg. Member (6) Drug spend $ 72.02 $ 74.31 -3.1% $ 304.44 $ 272.20 11.8% Gross profit $ 3.20 $ 2.83 13.2%(7) $ 11.84 $ 11.25 5.3%(7) EBITDA $ 1.64 $ 1.47 11.5%(7) $ 6.12 $ 5.83 5.0%(7) Margin Analysis Gross profit margin 7.1% 10.3% -30.6%(8) 8.0% 10.8% -26.1%(8) EBITDA margin 3.6% 5.3% -31.7%(8) 4.1% 5.6% -26.6%(8) Per Adjusted Claim Drug spend $ 38.37 $ 37.22 3.1% $ 40.20 $ 36.50 10.1% Gross profit $ 1.71 $ 1.42 20.4%(7) $ 1.56 $ 1.51 3.7%(7) EBITDA $ 0.87 $ 0.74 18.6%(7) $ 0.81 $ 0.78 3.4%(7)
EXPRESS SCRIPTS, INC. Table 2 Unaudited Earnings Excluding Non-Recurring Items (in thousands, except per share data)
3 Months Ended December 31, Year Ended December 31, ---------------------------------- ----------------------------------- 2000 1999 2000 1999 --------------- --------------- ---------------- -------------- Reported income (loss) before income taxes $ 33,867 $ 196,600 $ (4,468) $ 265,466 Non-recurring items: Write-down of marketable securities(1) 9,707 - 165,207 - Gain on sale of assets(1) - (182,930) - (182,930) Stock compensation charge on sale of - 19,520 - 19,520 assets(1) Gain on restructuring of interest rate - - (1,500) - swaps Operational restructurings - 1,301 - 10,701 Interest on temporary debt(2) - - - 6,161 --------------- --------------- ---------------- -------------- 43,574 34,491 159,239 118,918 Income before tax excluding non-recurring items Provision for income taxes 17,566 14,856 65,097 51,592 --------------- --------------- ---------------- -------------- Net income excluding non-recurring items $ 26,008 $ 19,635 $ 94,142 $ 67,326 =============== =============== ================ ============== Weighted average number of shares outstanding during period - diluted(2) 39,502 39,403 39,033 38,125 =============== =============== ================ ============== Diluted earnings per share excluding non- recurring items $ 0.66 $ 0.50 $ 2.41 $ 1.77 =============== =============== ================ ============== (1) Relates to PlanetRx (2) Assume that the 1999 equity and debt offerings occurred on April 1, 1999, and exclude financing costs on the temporary debt associated with the acquisition of DPS.
Unaudited Cash Earnings Excluding Non-Recurring Items Table 3 (in thousands, except per share data)
3 Months Ended December 31, Year Ended December 31, ======================================== ================================== 2000 1999 2000 1999 ======================================== ================================== Income before tax excluding non-recurring items $ 43,574 $ 34,491 $ 159,239 $ 118,918 8,848 8,750 35,031 28,202 Goodwill amortization --------------- --------------- ---------------- ------------- Income before tax excluding goodwill amortization and non-recurring items 52,422 43,241 194,270 147,120 Provision for income taxes 19,994 17,243 74,663 58,683 --------------- --------------- ---------------- ------------- Net income excluding goodwill amortization and non-recurring items $ 32,428 $ 25,998 $ 119,607 $ 88,437 =============== =============== ================ ============= Weighted average number of shares outstanding during period - diluted(2) 39,502 39,403 39,033 38,125 =============== =============== ================ ============= Diluted Cash earnings per share excluding non-recurring items $ 0.82 $ 0.66 $ 3.06 $ 2.32 =============== =============== ================ ============= (2) Assume that the 1999 equity and debt offerings occurred on April 1, 1999, and exclude financing costs on the temporary debt associated with the acquisition of DPS.
EXPRESS SCRIPTS, INC. Notes (in thousands) Unaudited Operating Statistics (excludes non-recurring items) (1) Our PBM revenues generally include administrative fees, dispensing fees and ingredient costs of pharmaceuticals dispensed from retail pharmacies included in our of our networks or from one of our mail pharmacies, and the associated costs are recorded in cost of revenues (the Gross Basis). Where we only administer the contracts between our clients and the client's retail pharmacy networks we record as revenues only the administrative fee we received from our activities (the Net Basis). (2) This increase primarily reflects the transfer of clients to pharmacy networks managed by us (gross method--see footnote 1). (3) This increase primarily reflects additional volume in Specialty Distribution Services as a result of a new contract that took effect during the fourth quarter of 1999. (4) Adjusted claims represent network claims plus mail claims, which are multiplied by 3, as mail claims are typically 90 day scripts and network claims are generally 30 day scripts. (5) Represents members as of January 1, 2001 and 2000, respectively. (6) Calculated based on average members. (7) Reflects the increase in mail prescriptions and the success in cross-selling additional services to our existing membership. (8) Margin analysis is not indicative of profitability-margins are greatly impacted by the transfer of clients to pharmacy networks managed by us (gross basis) from clients' networks (net basis). When we process claims for a client's pharmacy network, all we record as revenue is an administrative fee (net basis). When a client is transferred to one of our networks, we charge the administrative fee and a fee for managing the pharmacy network. In addition, we gross up revenues and cost of revenues to include the ingredient cost (gross basis). Thus, while the margin percentage appears to decline because revenues are grossed up for the ingredient cost, our actual profit per claim and net income improves due to the fee we receive for managing the pharmacy network. EXPRESS SCRIPTS, INC. Table 4
Selected Ratio Analysis As of December 31, 2000 Debt to EBITA ratio (1) 1.4x Interest coverage ratio (1) 5.8x Debt to enterprise value 9.1% Debt to capitalization 36.0% (1) Uses financial information for the year ended December 31, 2000
Table 5
Days Sales Outstanding (DSO) Year ended December 31, ($ in thousands) 2000 1999 ---- ---- Total revenue $ 6,786,864 $ 4,288,104 Client/pharmacy pass through (1) 2,812,150 3,570,108 ---------------- ---------------- Total $ 9,599,014 $ 7,858,212 ================ ================ Average monthly gross receivables $ 818,551 $ 597,160 ================ ================ DSO (in days) 31.2 27.7 ================ ================ (1) For clients that have their own pharmacy network, we record only an administrative fee in revenue (Net Basis). The client/pharmacy pass through reflects the amounts paid to the pharmacies that are not included in revenue, but are recorded as both an Accounts Receivable and Accounts Payable on our books.