Air Methods Q2 Results Miss Estimates

(RTTNews) - Air medical transportation provider Air Methods Corp. (AIRM) reported Thursday a profit for the second quarter that declined 39 percent from last year, hurt by higher maintenance costs and fewer transportation amid increased number of cancellations due to weather. Both earnings per share and quarterly revenues missed analysts' expectations.

"While severe increases in weather cancellations and higher maintenance had a significant impact on the quarter, we are pleased to see that decreases in June and July flight volumes appear to be primarily attributed to higher weather cancellations," CEO Aaron Todd said in a statement.

The Englewood, Colorado-based air medical emergency transport services and systems provider reported net income of $19.15 million or $0.49 per share for the second quarter, lower than $31.41 million or $0.81 per share in the prior-year quarter.

On average, eight analysts polled by Thomson Reuters expected the company to report earnings of $0.60 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue for the quarter increased 2 percent to $226.21 million from $222.48 in the same quarter last year, but missed six Wall Street analysts' consensus estimate of $227.71 million by a whisker.

Results for the latest quarter include the operations associated with Sundance Helicopters Inc., a Grand Canyon tour operator that was acquired by Air Methods in December 2012. Sundance generated segment net income of $1.1 million on quarterly revenues of $16.0 million.

Air Medical Services revenue declined 5 percent to $205.2 million, while United rotorcraft division's external revenue decreased 34 percent to $4.9 million from last year.

Patient transports for the quarter decreased 9 percent to 13,835 from 15,134 in the prior-year quarter, with same-base transports declining 12 percent as weather cancellations for these same bases increased and requests for community-based service for these same bases decreased 7 percent.

Net revenue per patient transport increased 4 percent to $10,766, compared with $10,396 in the prior-year quarter.

Maintenance expense, excluding Sundance, increased 16 percent from last year, despite flight hours having decreased 9 percent, due to higher engine overhaul costs and higher heavy airframe inspections on two models of aircraft.

Total expenses for the quarter increased to $190 million from $167 million from last year, with operating expenses growing to $141 million from $120 million a year ago.

Air Methods also provided an update on preliminary July 2013 flight volume. Total community-based transports for the month decreased 6 percent from the year-ago period to 4,760. Same-base transports decreased by 491 transports, or 10 percent, while weather cancellations for these same bases increased by 540 transports.

"We expect meaningful improvement in future earnings based on anticipated improvement in weather and maintenance trends over the coming periods," Todd added.

AIRM closed Thursday's regular trading session at $35.61, up $1.91 or 5.67% on a volume of 0.49 million shares. The stock gained a further $0.39 or 1.10% in after-hours trading.