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Press release from CNW Group

OPMEDIC GROUP Inc. announces its financial results for the fourth quarter and for the year ended August 31, 2011 and declares a dividend on common shares

Monday, November 14, 2011

OPMEDIC GROUP Inc. announces its financial results for the fourth quarter and for the year ended August 31, 2011 and declares a dividend on common shares09:15 EST Monday, November 14, 2011/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES./MONTREAL, Nov. 14, 2011 /CNW Telbec/ - OPMEDIC GROUP Inc. ("OPMEDIC GROUP") (TSX: OMG), a healthcare-related company in fertility, laboratories and surgeries providing services and facilities to patients and surgeons, is pleased to announce its financial results for the fourth quarter and for the year ended August 31, 2011.HIGHLIGHTS FOR THE YEAR ENDED AUGUST 31, 2011:Revenue up by 55%. Revenue for the year ended August 31, 2011 totalled $22.297 million compared to $14.348 million in 2010.Gross profit up by 67%. Gross profit for the year ended August 31, 2011 totalled $13.267 million compared to $7.932 million in 2010.Net earnings up by 185%. Net earnings and net earnings per share for the year ended August 31, 2011 were respectively $5.355 million and $0.31 compared to $1.877 million and $0.11 in 2010.RevenuesRevenues for the year ended August 31, 2011 totalled $22.297 million, up 55% or $7.949 million from $14.348 million for the same period in 2010. The increase in fertility activities as a result of the new free assisted procreation services program established in the Province of Quebec generated additional revenues of $7.729 million over the same period in the previous year. Surgical and endoscopic activities continued to grow with additional revenues of $0.446 million, while prenatal screening was down by $0.412 million due to higher competition in both the public and private sectors.Cost of ServicesThe cost of services for the year ended August 31, 2011 increased by $2.614 million or 41% from   $6.416 million in the previous year to $9.030 million in 2011. The higher volume of fertility activities required additional costs of $1.018 million in payroll, of $0.798 million in supplies, and of $0.271 million in professional fees. Surgical and endoscopic activities required extra payroll expenses and supplies of $0.218 million.Gross ProfitGross profit totalled $13.267 million for the year ended August 31, 2011, up $5.335 million or 67% from $7.932 million in 2010. This improvement was primarily attributable to the upward trend in revenues. The fertility services segment enhanced gross profit by $5.175 million, while the surgical and endoscopic services and facilities segment contributed $0.160 million to gross profit.Gross profit in relation to revenues rose to 60% in 2011 from 55% in 2010.General and Administrative ExpensesGeneral and administrative expenses rose to $4.429 million for the year ended August 31, 2011, up $0.573 million or 15% from $3.856 million in 2010. Professional fees increased by $0.353 million mainly because of external consulting fees to prepare for convergence with the international accounting standards, legal and consulting fees paid to open the new fertility clinic in the city of Vaughan (Ontario), and assessment fees for ISO 15189 accreditation of the laboratories by the Bureau de normalisation du Québec. In addition, administrative salaries were up by $0.283 million as a result of the extra customer service staff added to handle the higher volume of activities, which was offset by a $0.082 million drop in advertising expenses.Net Earnings  Net earnings and net earnings per share for the year ended August 31, 2011 were respectively $5.355 million and $0.31, versus $1.877 million and $0.11, respectively, for the previous year.HIGHLIGHTS FOR THE FOURTH QUARTER:Revenue up by 60%. Revenue for the fourth quarter totalled $5.762 million compared to $3.599 million for the same period in 2010.Gross profit up by 65%. Gross profit for the quarter ended August 31, 2011 totalled $3.177 million compared to $1.922 million in 2010.Net earnings up by 174%. Net earnings and net earnings per share for the quarter ended August 31, 2011 were respectively $1.166 million and $0.07 compared to $0.425 million and $0.02 in 2010.RevenuesRevenues for the quarter ended August 31, 2011 totalled $5.762 million, up 60% or $2.163 million from $3.599 million in the previous year.The increase in fertility activities as a result of the new free assisted procreation services program established in the Province of Quebec generated additional revenues of $2.282 million, compared to the same period in the previous year, while prenatal screening activities were down by $0.129 million due to higher competition in both the public and private sectors.Cost of ServicesThe cost of services for the quarter ended August 31, 2011 rose by $0.908 million or 54% from $1.677 million in 2010 to $2.585 million in 2011.The higher volume of fertility activities entailed additional costs of $0.328 million in payroll, of $0.247 million in supplies, and of $0.108 million in professional fees. In addition, the joint venture for the clinic in the city of Vaughan (Ontario) has cost $0.169 million mainly in payroll, rent and supplies since the clinic opened on July 11, 2011.Gross ProfitGross profit for the quarter ended August 31, 2011 was up $1.255 million or 65% to $3.177 million from $1.922 million in 2010. The major increase in revenue directly affected gross profit because of economies of scale. For the fertility services segment, gross profit was up $1.327 million, while gross profit was down $0.072 million in the surgical and endoscopic services and facilities segment.Gross profit in relation to revenues for the fourth quarter was 55% in 2011, versus 53% in 2010.General and Administrative Expenses General and administrative expenses for the quarter ended August 31, 2011 totalled $1.230 million, up $0.282 million or 30% from $0.948 million in 2010. Administrative salaries increased by $0.159 million following the addition of customer service staff and the recognition of stock-based compensation. Furthermore, $0.139 million was required for payroll and the opening of the clinic in the city of Vaughan (Ontario).Net Earnings  Net earnings and net earnings per share for the fourth quarter were respectively $1.166 million and $0.07, as opposed to $0.425 million and $0.02 in 2010.DECLARATION OF DIVIDEND ON COMMON SHARESThe Company's Board of Directors has declared a cash dividend of $0.025 per share payable on November 28, 2011 to shareholders of record at the close of business on November 21, 2011. Future dividends are subject to the discretion of the Board of Directors.The Company designates this dividend to be an "eligible dividend" pursuant to subsection 89(14) of the Income Tax Act (Canada) and its equivalent in any provinces of Canada.Detailed financial results can be accessed on the OPMEDIC GROUP web site at www.opmedicgroup.com.About OPMEDIC GROUPOPMEDIC GROUP is a company incorporated under the laws of the Province of Quebec which provides healthcare-related services including surgical and endoscopic facilities and services to patients and surgeons (with its OPMEDIC division), fertility treatments, medical imaging, laboratory services and diagnostic procedures (with its PROCREA Cliniques division and a joint venture 7667264 Canada Inc.) and sperm banking services (with its PROCREA Cryopreservation Centre subsidiary). OPMEDIC GROUP's Common Shares trade on the Toronto Stock Exchange under the symbol "OMG".This news release does not constitute an offer to sell or to solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful. This news release contains certain forward-looking statements that reflect the current views and/or expectations of OPMEDIC GROUP with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.The Content of this press release has not been approved by nor submitted to the TSX which assumes no liability therefore.For further information: Jean-Marc LACHANCE Vice President Finance and Chief Financial Officer (514) 345-8535, x 2260 jmlachance@opmedicgroup.com