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Press release from CNW Group

OPMEDIC Group Inc. announces its financial results for the third quarter and declares a dividend on common shares

Friday, July 13, 2012

OPMEDIC Group Inc. announces its financial results for the third quarter and declares a dividend on common shares09:15 EDT Friday, July 13, 2012/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES./MONTREAL, July 13, 2012 /CNW Telbec/ - OPMEDIC Group Inc. ("OPMEDIC GROUP") (TSX: OMG), a healthcare-related corporation in fertility, laboratories and surgeries providing services and facilities to patients and surgeons, announces its financial results for the third quarter ended May 31, 2012.HIGHLIGHTS:Revenue down by 18%. Revenue for the third quarter totalled $5.084 million compared to $6.164 million for the same period a year earlier.Gross profit down by 33%. Gross profit for the third quarter totalled $2.718 million compared to $4.033 million for the same period a year earlier.Net profit down. Net profit and earnings per share for the third quarter were respectively $0.658 million and $0.04 compared to $1.833 million and $0.11 a year earlier.Declaration of a dividend of $0.02 on common sharesRevenuesRevenues for the quarter ended May 31, 2012 totalled $5.084 million, down $1.080 million or 18% from $6.164 million in the same period in 2011. Despite an 8% increase in the volume of IVF procedures during the quarter versus the previous period, fertility revenues decreased by $0.871 million primarily as a result of the reduction in the government prescribed rates for IVF procedures as of the beginning of January 2012. Prenatal screening was down $0.204 million mainly due to the increased offer of services in the public system.For the nine-month period ended May 31, 2012, revenues totalled $14.930 million, down $1.605 million or 10% from $16.535 million in 2011. Despite a 16% increase in the volume of IVF procedures compared with the previous period, fertility revenues were down $0.724 million as a result of the reduced rates. Prenatal screening was down $0.550 million, still affected by the increased offer in the public system, and OPMEDIC Division's surgical operations decreased by $0.191 million primarily because of fewer hours of operating room rentals.Cost of ServicesThe cost of services for the three-month period rose from $2.131 million in 2011 to $2.366 million in 2012, up $0.235 million or 11%. The increase in fertility operations entailed additional costs of $0.085 million in payroll, and $0.030 million in supplies. In addition, the operations of the new South Shore endoscopic centre incurred costs of $0.095 million in payroll, rentals and medical supplies.For the nine-month period ended May 31, 2012, the cost of services totalled $6.717 million, up $0.489 million or 8% from $6.228 million in 2011. The increase in fertility operations required additional costs of $0.269 million in payroll, and of $0.140 million in supplies, which were partially offset by the $0.185 million decline in professional fees primarily related to prenatal screening. The new South Shore endoscopic centre incurred costs of $0.212 million in payroll, rentals and medical supplies.Gross ProfitGross profit for the quarter ended May 31, 2012 stood at $2.718 million, down $1.315 million or 33% from $4.033 million in 2011. For the fertility segment, gross profit decreased by $1.172 million, while in the OPMEDIC division, it was down by $0.143 million as a result of lower revenues.Gross profit in relation to revenues for the quarter was 53% in 2012, versus 65% in 2011.Gross profit for the nine-month period ended May 31, 2012 totalled $8.213 million, down $2.094 million or 20% from $10.307 million in 2011. For the fertility segment, gross profit decreased by $1.689 million, while in the OPMEDIC division, it was down by $0.405 million as a result of lower revenues.Gross profit in relation to revenues for the nine-month period ended May 31, 2012 was 55%, as opposed to 62% in 2011.General and Administrative ExpensesGeneral and administrative expenses for the quarter ended May 31, 2012 were $1.651 million, up $0.278 million or 20% over $1.373 million in 2011. Additional administrative support staff hired plus higher advertising expenses and annual report costs accounted for the $0.101 million increase. Furthermore, payroll, rental and office expenses for the opening of the new endoscopic centre on the South Shore totalled $0.046 million, and capital asset depreciation rose by $0.087 million as a result of the previous year's fertility segment acquisitions and the investments in the new endoscopic centre.For the nine-month period ended May 31, 2012, general and administrative expenses were $4.584 million, up $0.505 million or 12% over $4.079 million in 2011. Administrative salaries, advertising expenses and annual report costs totalled $0.244 million, while payroll, rental and office expenses for the new South Shore endoscopic centre amounted to $0.117 million, and the depreciation expense was also up by $0.140 million. The $0.073 million decrease in professional fees offset increases emanating, for instance, from ISO and Standards Council of Canada laboratory accreditation in 2011, which was not required in 2012, and the lower fees for the conversion to the new accounting standards in 2011.Net Profit  Net profit and net earnings per share for the quarter ended May 31, 2012 were respectively $0.658 million and $0.04, compared with $1.833 million and $0.11, respectively, for the previous year.For the nine-month period ended May 31, 2012, net profit and net earnings per share were respectively $2.283 million and $0.13, compared with $4.268 million and $0.25, respectively, for 2011.DECLARATION OF DIVIDEND ON COMMON SHARESThe Corporation announces that its Board of Directors has declared a cash dividend of $0.02 per share payable July 31, 2012 to shareholders of record at the close of business on July 25, 2012. Future dividends are subject to the discretion of the Board of Directors.The Corporation 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 corporation 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 one of its joint ventures) 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