Dallas, Texas (August 16, 2011) – StockGuru Shines its Spotlight on Access Plans, Inc. (OTCBB: APNC), a leading membership benefits marketing company, yesterday announced results for the third quarter and first nine months of FY2011. The Company will hosted an investor conference call at 11:00 a.m. Eastern Time on August 15, 2011, to discuss its operating results and related topics. The Company closed on August 15, 2011, at $2.50, up 8.7 percent trading at the top of its fifty-two week range of $2.86 – 1.55.
For the three months ended June 30, 2011, pretax income rose 124% to approximately $3.0 million, compared with approximately $1.3 million in the three months ended June 30, 2010, reflecting continued moderation of variable expenses associated with Wholesale Plans Division offerings and income associated with programs implemented during FY2010 in the Retail Plans Division. Net income increased 61% to approximately $1.5 million, or $0.07 per diluted share, in the third quarter of FY2011, compared with $0.9 million, or $0.05 per diluted share, in the corresponding period of the previous fiscal year. Revenues decreased 9%, as expected, to $13.1 million, reflecting mandated commission schedule reductions on major medical policies sold by the Insurance Marketing Division effective January 1, 2011.
For the nine months ended June 30, 2011, revenues were essentially unchanged at approximately $41.1 million, versus approximately $41.1 million in the first nine months of FY2010. Increases in revenues in the Wholesale Plans Division of $2.3 million and an increase of $0.6 million in the Retail Plans Division were offset by a decrease of $0.3 million in intercompany eliminations and a decrease of $1.9 million associated with reductions in commissions associated with premiums earned on major medical insurance policies sold after January 1, 2011. Pretax income increased 101% to approximately $8.6 million, compared with approximately $4.3 million in the nine months ended June 30, 2010. Net income rose 90% to approximately $4.9 million, or $0.24 per diluted share, in the first nine months of FY2011, compared with approximately $2.6 million, or $0.13 per diluted share, in the corresponding period of the previous fiscal year.
“For the nine months of Fiscal 2011, the Company has produced record earnings, and our debt-free balance sheet is stronger than ever,” noted Danny Wright, Chairman and Chief Executive Officer of Access Plans, Inc. “The return to historic margin levels in the Wholesale and Retail Plan divisions, coupled with increased employee productivity, have more than offset the challenges that our Insurance Marketing Division has faced due to the reduction in major medical insurance commissions mandated by the Health Care Reform Act. The Company continues to see increased customer participation in many of its membership programs and expects this trend to continue. We expect earnings in the fourth quarter of Fiscal 2011 to substantially exceed earnings in the prior-year period and look forward to a record fiscal year ending September 30, 2011.”
Wholesale Plans
Wholesale Plans Division revenue increased 11% to $6.4 million in the most recent quarter, versus $5.8 million in the third quarter of FY2010, while operating income rose 42% to $1.9 million, compared with $1.4 million in the prior-year period.
For the nine months ended June 30, 2011, revenues in the Wholesale Plans Division increased 14% to $18.8 million, versus $16.5 million in the prior-year period. The increase in revenues was attributable to improved sell-through at existing customer locations, along with the addition of new accounts and new locations within existing accounts. Gross profit improved 71% to $7.0 million (37% of revenues), compared with $4.1 million (25% of revenues) in the first three quarters of FY2010, reflecting higher revenues and a reduction in involuntary unemployment waiver expenses resulting from lower levels of initial unemployment claims nationally and the expiration of certain waiver benefits. Operating income at the division increased 117% to $5.6 million for the nine-month period, versus $2.6 million in the first nine months of FY2010.
Retail Plans
For the quarter, revenue within the Retail Plans Division decreased 11% to $4.3 million, versus $4.9 million in the third quarter of FY2010. Operating income increased 306%, from $0.4 million in the third quarter of FY2010 to $1.8 million in the most recent quarter due to the discontinuation of an inbound call center initiative that, although high in revenue, had a negative impact on income in the FY2010 period.
Revenues in the Retail Plans Division increased 2% during the nine months ended June 30, 2011 to $13.2 million, prior to inter-company eliminations, versus $12.9 million in the prior-year period. The increase was attributable primarily to contributions from new programs that offset anticipated revenue declines in the Company’s legacy business and the discontinuation of the inbound call center initiative. Gross profit increased 29%, from $6.0 million (47% of revenues) in the first nine months of FY2010 to $7.8 million (59% of revenues) in the nine months ended June 30, 2011. Retail Plans Division operating income increased 85% to $4.8 million for the nine-month period, versus $2.6 million in the first nine months of FY2010.
Insurance Marketing
Insurance Marketing Division revenues decreased 24% to $3.8 million in the third quarter of FY2011, compared with $5.0 million in the third quarter of FY2010. The decline was due to reductions in commission income on major medical insurance policies resulting from the implementation of the Healthcare Reform Act. The division’s operating income improved to $0.01 million in the third quarter of FY2011, versus an operating loss of $0.05 million in last year’s third quarter.
For the nine-month period, Insurance Marketing revenues decreased 13%, from $15.4 million in the first nine months of FY2010 to $13.5 million in the corresponding FY2011 period. Operating income for the Insurance Marketing Division decreased from $0.3 million in the nine months ended June 30, 2010 to $0.1 million in the corresponding period of FY2011.
Other Matters
Cash, cash equivalents and restricted cash increased 97% during the first three quarters of FY2011, from $6.2 million on September 30, 2010 to $12.1 million on June 30, 2011. The Company does not have any long-term debt outstanding. Stockholders’ equity totaled $19.3 million on June 30, 2011, which represented a nine-month increase of approximately 35% when compared with $14.2 million in stockholders’ equity on September 30, 2010.
Conference Call Information
The Company will host an investor conference call at 11:00 a.m. Eastern Time today, August 15, 2011. Shareholders and other interested parties may participate in the conference call by dialing 877-317-6789 (international/local participants dial 412-317-6789) and asking to be connected to the “Access Plans, Inc. Conference Call” a few minutes before 11:00 a.m. EDT today. The call will also be broadcast live on the Internet at http://www.videonewswire.com/event.asp?id=81654 .
A replay of the conference call will be available one hour after the call through Monday, August 22, 2011 at 9:00 a.m. EDT by dialing 877-344-7529 (U.S.) or 412-317-0088 (international) and entering the conference ID Number 10002994.
The conference call will be archived for review on the Internet at http://www.videonewswire.com/event.asp?id=81654 and on the Company’s website at www.accessplans.com through Monday, August 22, 2011.
About Access Plans, Inc.
Access Plans, Inc. (OTCBB: APNC) is a leading membership benefits marketing company with two distribution channels. The Wholesale/Retail Plans distribution channel specializes in turnkey, private-label membership benefit plans that provide discount products and services, protection benefits and retail services to more than 1 million customers in the United States and Canada. America’s Health Care Plan (AHCP), the Company’s Insurance Marketing distribution channel, is one of the nation’s largest independent agent networks and provides major medical, life and supplemental insurance products to individuals. For more information, please visit: www.accessplans.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act:
This press release contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, Section 27A of the Securities Act of 1933, as amended and pursuant to the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may relate to financial results and plans for future business activities, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are competitive pressures, loss of significant customers, the mix of revenue, changes in pricing policies, delays in revenue recognition, lower-than-expected demand for the Company’s products and services, general economic conditions, and the risk factors detailed from time to time in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission. Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and the Company assumes no responsibility for updating such forward-looking statements after the date of this release.
| Access Plans, Inc. | |||||||||||||||||||||||||||||||
| Consolidated Statements of Operations | |||||||||||||||||||||||||||||||
| (Unaudited and dollars in thousands, except earnings per share) | |||||||||||||||||||||||||||||||
| For the Three Months | For the Nine Months | ||||||||||||||||||||||||||||||
| Ended June 30, | Ended June 30, | ||||||||||||||||||||||||||||||
| 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||||||||||
| Net revenues | $ | 13,077 | $ | 14,371 | $ | (1,294 | ) | -9 | % | $ | 41,135 | $ | 41,134 | $ | 1 | 0 | % | ||||||||||||||
| Direct costs | 7,289 | 10,129 | (2,840 | ) | -28 | % | 24,225 | 28,390 | (4,165 | ) | -15 | % | |||||||||||||||||||
| Gross profit | 5,788 | 4,242 | 1,546 | 36 | % | 16,910 | 12,744 | 4,166 | 33 | % | |||||||||||||||||||||
| Operating expenses | 2,830 | 2,900 | (70 | ) | -2 | % | 8,368 | 8,505 | (137 | ) | -2 | % | |||||||||||||||||||
| Operating income | 2,958 | 1,342 | 1,616 | 120 | % | 8,542 | 4,239 | 4,303 | 102 | % | |||||||||||||||||||||
| Net other income (expense) | 11 | (19 | ) | 30 | -158 | % | 12 | 20 | (8 | ) | -40 | % | |||||||||||||||||||
| Provision for income taxes, net | 1,443 | 375 | 1,068 | 285 | % | 3,646 | 1,679 | 1,967 | 117 | % | |||||||||||||||||||||
| Net income | $ | 1,526 | $ | 948 | $ | 578 | 61 | % | $ | 4,908 | $ | 2,580 | $ | 2,328 | 90 | % | |||||||||||||||
| Per Share Data: | |||||||||||||||||||||||||||||||
| Basic | $ | 0.08 | $ | 0.05 | 0.02 | 39 | % | $ | 0.25 | $ | 0.13 | 0.12 | 91 | % | |||||||||||||||||
| Diluted | $ | 0.07 | $ | 0.05 | 0.03 | 53 | % | $ | 0.24 | $ | 0.13 | 0.11 | 86 | % | |||||||||||||||||
| Average Shares Outstanding: | |||||||||||||||||||||||||||||||
| Basic | 19,927 | 19,777 | 150 | 1 | % | 19,899 | 19,954 | (55 | ) | 0 | % | ||||||||||||||||||||
| Diluted | 20,998 | 20,009 | 989 | 5 | % | 20,619 | 20,134 | 485 | 2 | % | |||||||||||||||||||||
| For the Three Months | For the Nine Months | ||||||||||||||||||||||||||||||
| Ended June 30, | Ended June 30, | ||||||||||||||||||||||||||||||
| 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||||||||||
| Segment net revenues | |||||||||||||||||||||||||||||||
| Wholesale Plans | $ | 6,424 | $ | 5,764 | $ | 660 | 11 | % | $ | 18,795 | $ | 16,539 | $ | 2,256 | 14 | % | |||||||||||||||
| Retail Plans | 4,332 | 4,883 | (551 | ) | -11 | % | 13,182 | 12,893 | 289 | 2 | % | ||||||||||||||||||||
| Insurance Marketing | 3,815 | 5,017 | (1,202 | ) | -24 | % | 13,509 | 15,441 | (1,932 | ) | -13 | % | |||||||||||||||||||
| Eliminations | (1,494 | ) | (1,293 | ) | (201 | ) | 16 | % | (4,351 | ) | (3,739 | ) | (612 | ) | 16 | % | |||||||||||||||
| $ | 13,077 | $ | 14,371 | $ | (1,294 | ) | -9 | % | $ | 41,135 | $ | 41,134 | $ | 1 | 0 | % | |||||||||||||||
| For the Three Months | For the Nine Months | ||||||||||||||||||||||||||||||
| Ended June 30, | Ended June 30, | ||||||||||||||||||||||||||||||
| 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||||||||||
| Segment operating income | |||||||||||||||||||||||||||||||
| Wholesale Plans | $ | 1,942 | $ | 1,364 | $ | 578 | 42 | % | $ | 5,596 | $ | 2,584 | $ | 3,012 | 117 | % | |||||||||||||||
| Retail Plans | 1,800 | 443 | 1,357 | 306 | % | 4,783 | 2,589 | 2,194 | 85 | % | |||||||||||||||||||||
| Insurance Marketing | 13 | (49 | ) | 62 | -127 | % | 122 | 275 | (153 | ) | -56 | % | |||||||||||||||||||
| Corporate | (797 | ) | (416 | ) | (381 | ) | 92 | % | (1,959 | ) | (1,209 | ) | (750 | ) | 62 | % | |||||||||||||||
| $ | 2,958 | $ | 1,342 | $ | 1,616 | 120 | % | $ | 8,542 | $ | 4,239 | $ | 4,303 | 102 | % | ||||||||||||||||
| Access Plans, Inc. | ||||||
| Condensed Consolidated Balance Sheets | ||||||
| (Unaudited and dollars in thousands) | ||||||
| September 30, | ||||||
| 2010 | ||||||
| June 30, | (Derived From | |||||
| 2011 | Audited | |||||
| (Unaudited) | Statements) | |||||
| Total current assets | $ | 18,770 | $ | 16,297 | ||
| Total assets | $ | 26,335 | $ | 24,852 | ||
| Total current and long term liabilities | $ | 7,086 | $ | 10,638 | ||
| Total stockholders’ equity | $ | 19,249 | $ | 14,214 | ||
| Total liabilities and stockholders’ equity | $ | 26,335 | $ | 24,852 | ||
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