Envision Healthcare Holdings (EVHC) has reported 50.20 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $25.89 million, or $0.13 a share in the quarter, compared with $17.24 million, or $0.09 a share for the same period last year. On an adjusted basis, earnings per share were at $0.36 for the quarter compared with $0.30 in the same period last year. Revenue during the quarter grew 19.85 percent to $1,638.75 million from $1,367.37 million in the previous year period. Total expenses were 94.92 percent of quarterly revenues, down from 95.62 percent for the same period last year. This has led to an improvement of 70 basis points in operating margin to 5.08 percent.
Operating income for the quarter was $83.30 million, compared with $59.96 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $180.65 million compared with $142.48 million in the prior year period. At the same time, adjusted EBITDA margin improved 60 basis points in the quarter to 11.02 percent from 10.42 percent in the last year period.
"In spite of lower sector volume growth in the period, our third quarter reflects strong operating results at EmCare, including encouraging progress at Evolution Health, and performance improvement at AMR’s Rural Metro operations," said William A. Sanger, chairman, president and chief executive officer of Envision. "Rural Metros margins improved, driven by continued integration into AMR’s operations and technology platforms. Our results at Evolution Health improved as we realized benefits from our participation in bundled payment models and medical cost savings from our contract with a Florida health plan.
For financial year 2016, the company forecasts diluted earnings per share to be in the range of $1.39 to $1.42 on adjusted basis.
Operating cash flow improves significantlyEnvision Healthcare Holdings has generated cash of $252.43 million from operating activities during the nine month period, up 29.49 percent or $57.49 million, when compared with the last year period. The company has spent $287.17 million cash to meet investing activities during the nine month period as against cash outgo of $629.45 million in the last year period. It has incurred net capital expenditure of $137.13 million on net basis during the nine month period, up 134.77 percent or $78.72 million from year ago period.
Cash flow from financing activities was $83.09 million for the nine month period, down 66.16 percent or $162.41 million, when compared with the last year period.
Cash and cash equivalents stood at $190.03 million as on Sep. 30, 2016, up 46.30 percent or $60.14 million from $129.89 million on Sep. 30, 2015.
Working capital increases sharply
Envision Healthcare Holdings has recorded an increase in the working capital over the last year. It stood at $946.50 million as at Sep. 30, 2016, up 37.90 percent or $260.16 million from $686.34 million on Sep. 30, 2015. Current ratio was at 2.25 as on Sep. 30, 2016, up from 2 on Sep. 30, 2015.
Days sales outstanding went down to 68 days for the quarter compared with 75 days for the same period last year.
Debt increases substantially
Envision Healthcare Holdings has witnessed an increase in total debt over the last one year. It stood at $3,055.44 million as on Sep. 30, 2016, up 36.49 percent or $816.86 million from $2,238.58 million on Sep. 30, 2015. Total debt was 45.91 percent of total assets as on Sep. 30, 2016, compared with 42.26 percent on Sep. 30, 2015. Debt to equity ratio was at 1.43 as on Sep. 30, 2016, up from 1.15 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 2.12 for the quarter from 2.17 for the same period last year.
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