Despite growing revenue by 10.6 percent, Emdeon’s net loss widened from $1.2 million to $7.2 million in the third quarter of 2009.
The health care revenue and payment cycle solutions company, which went public in August, had total revenue of $236 million, compared to $213 million in Q3 2008, and net loss per share of 9 cents , up from 2 cents.
Excluding $12.6 million in equity compensation related to the IPO and other special items, Emdeon’s adjusted net income was 21 cents per share, compared to 17 cents per share in Q3 2008.
After closing the day 2.7 percent higher than its Tuesday open, at $16.20 per share, the company’s stock (Ticker: EM ) took a dive in after-hours trading Tuesday, falling more than 6 percent. In pre-market activity, it was off about 5 percent.
Talking to analysts after the earnings release, company executives said they were pleased with the quarter’s results and optimistic about future growth opportunities. The company’s payer business, which represents 42 percent of revenue, already has exceeded its full-year 2008 sales total. Sales for Emdeon’s provider business are up 10 percent year to date and its e-prescribing pharmacy business has more than doubled year over year.
Chairman Tracy Bahl said the company also is “encouraged” by the reform bills in both the House and Senate as they relate to electronic payments. “Technology is a meaningful component of health care reform, regardless of the final bill,” he said.
During the quarter, Emdeon divested its non-core office supplies and forms business, which was responsible for $9 million in revenue in 2008. It also signed a multi-year agreement with Cigna in the quarter, though it no longer holds  an exclusive contract with the insurer.
In a note to clients, Jefferies analyst Richard Close said Emdeon is staying on track with its strategic plans and said the new Cigna contract should be seen as the exception. He reiterated his 'buy' rating and $20 price target.