Merge Healthcare Incorporated, a health IT solutions provider, announced financial results for the fourth quarter and full year 2009.
“Merge Healthcare ended 2009 as a much different company than it started the year,” says Justin Dearborn, Merge CEO. “We have executed on a strategy to diversify the company to take advantage of opportunities within the broader global Healthcare IT market, while leveraging our core imaging expertise. We believe the investments we have made during 2009 in new products and international markets, along with our acquisition strategy, will benefit our shareholders in 2010 and beyond.”
Recurring revenue* comprised greater than 60% of total net sales in each of the fourth and third quarter of 2009, and greater than 50% of total net sales in the fourth quarter of 2008. Net sales in each of the periods indicated above have been reduced by the impact of purchase accounting, which was $1.0 million in the fourth quarter compared to $0.6 million in the third quarter of 2009.
Additionally, Merge completed a registered direct common stock offering in the fourth quarter that resulted in proceeds, net of advisor fees, of $25.2 million. These proceeds were used to retire an existing note payable, resulting in $7.1 million of net proceeds. The debt retirement timing led to an income statement charge of $3.3 million, and resulted in total debt-related charges of $3.7 million in the fourth quarter.
In the fourth quarter of 2009, the cash balance increased by $2.7 million to $19.6 million as of December 31, 2009. Cash flow from operations was reduced in the fourth quarter by $5.4 million, primarily as a result of $3.1 million of interest and early debt retirement cash costs. An additional $1.0 million was expended on an acquisition of assets in support of 2010 business initiatives, as well as another $1.0 million of real estate costs.
Merge Healthcare Incorporated develops solutions that automate healthcare data and diagnostic workflow to enable a better electronic record of the patient experience, and to enhance product development for health IT, device and pharmaceutical companies. Merge products, ranging from standards-based development toolkits to sophisticated clinical applications, have been used by healthcare providers, vendors and researchers worldwide for over 20 years. Additional information can be found at www.merge.com