RADNOR, Pa., May 15, 2008 (PRIME NEWSWIRE) -- Health Benefits Direct Corporation (OTCBB:HBDT), a leading technology innovator in the direct marketing and sales of a wide range of individual health insurance, family health insurance, life insurance and other related products for the individual and family insurance market, today announced its results of operations for the first quarter ended March 31, 2008.
First Quarter Operational Highlights
* Revenues increased 42% compared to the first quarter of 2007. * Raised aggregate gross proceeds of $5 million from a private placement of common stock and warrants to certain institutional investors. * Closed New York office and reduced agency sales and support staff in Florida as part of overall strategic initiative to reduce operating costs. * Signed first contract to provide the Insurint(tm) platform to independent agents and successfully deployed the technology subsequent to quarter-end
"We are pleased to report an increase in our revenues for the first quarter of 2008 which were largely due to the performance of Atiam, a technology company that we acquired in October of last year, and, to a lesser extent, an increase in commission revenue in our Telesales business," stated Anthony Verdi, Chief Operating Officer and Chief Financial Officer of Health Benefits Direct. "Atiam contributed significant revenue and a modest profit to our results and, as part of our technology portfolio, further positions us for continued growth and execution on our strategy to be a technology innovator to the insurance industry. As part of this, Atiam's InsPro product continues to be highly visible and well received in the insurance carrier and TPA market place."
Mr. Verdi continued, "Our recently accelerated initiatives to increase our operating efficiency, including closing the New York office and reducing the sales and support staff in Florida, are already beginning to show positive results as evidenced by our first quarter financial results."
First Quarter 2008 Financial Results
Net loss for the first quarter of 2008 was $(4,321,232), or $(0.12) per basic and diluted share, as compared to a net loss of $(3,268,498), or $(0.11) per basic and diluted share for the first quarter of 2007. The net loss for the first quarter of 2008 included non-recurring restructuring and other charges amounting to approximately $1.6 million.
Revenues for the first quarter of 2008 increased 42% to $6,388,021 as compared to $4,513,015 for the first quarter of 2007. Atiam's revenue accounted for $1,285,323, or 28%, of the increase. Atiam's operating results prior to our October 1, 2007 acquisition of Atiam are excluded from our 2007 comparable quarter results.
Operating expenses for the first quarter ended March 31, 2008, totaled $10,350,594 as compared to $7,821,777, a 32% increase as compared to the first quarter ended March 31, 2007. Atiam's expenses accounted for $1,246,292 or, 16%, of the increase over 2007. Operating expenses include approximately $1.6 million of unique charges in the first quarter of 2008.
Salaries, wages and related taxes in the Telesales business segment for the first quarter of 2008 included approximately $1 million of non-recurring charges pertaining to the departure of certain executives and a director, together with expenses related to the Company's closing of its New York office. Depreciation and rent expense for the first quarter of 2008 included approximately $0.2 million of non-recurring charges pertaining to Company's closing of its New York office.
Additionally, the Company recorded an approximate $0.4 million charge for the impairment of leasehold improvements for its New York Office and certain intangible assets in the first quarter of 2008.
At March 31, 2008, Health Benefits Direct had a cash balance of $7,420,494, total assets of $16,848,984 and total shareholders' equity of $5,936,331.
Mr. Verdi concluded, "As announced in January of this year, we signed an agreement to provide our Insurint(tm) platform to AHCP, a leading health insurance agency and we are pleased to report that their independent insurance agents are taking advantage of Insurint(tm). For the first time, Insurint(tm) is being actively used outside of our own agency and we are proud to have reached this critical milestone. We look forward to reporting on the progress of this important business segment in coming quarters."
About Health Benefits Direct Corporation
Health Benefits Direct Corporation is a technologically innovative contact center based insurance agency that operates an interactive online marketplace enabling consumers to shop for, compare, and apply for individual health insurance, family health insurance, life insurance and other related products for the individual and family insurance market. Its streamlined Quick-to-Call sales platform, supported by proprietary online technology, dialing applications and tele-application voice signature process, promotes efficiency for consumers purchasing and insurance carriers underwriting individual and family insurance products. Through its subsidiary, Insurint (tm) Corporation, Health Benefits Direct provides a proprietary, professional-grade, web-based agent quote engine portal that aggregates accurate real-time quotes from multiple highly-rated health insurance carriers, life insurance carriers and carriers of related insurance products. Insurint's user-friendly platform enables agents to view and share with proposed insureds detailed comparisons of multiple insurance products, policy brochures and other useful information instantly, resulting in highly competitive application processing platform for insurance agents and consumers. Through its subsidiary, Atiam Technologies, Health Benefits Direct offers the InsPro system, an internet-based marketing and administration system used by Insurance carriers and Third Party Administrators. www.healthbenefitsdirect.com
Safe Harbor Statement
In addition to historical facts or statements of current condition, this press release contains forward-looking statements within the meaning of the "Safe Harbor" provisions of The Private Securities Litigation Reform Act of 1995, including statements regarding the effect of the agreement to offer the Insurint platform to AHCP's agents or the anticipated launch date of this offering to AHCP agents. Forward-looking statements provide Health Benefits Direct's current expectations or forecasts of future events. Moreover, Health Benefits Direct cautions readers that forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially and which are identified from time to time in Health Benefits Direct's reports filed with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, any or all of these forward-looking statements may prove to be incorrect. Therefore, you should not rely on any such factors or forward-looking statements. Health Benefits Direct undertakes no obligation to update publicly any forward-looking statement.
HEALTH BENEFITS DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended
March 31,
------------ ------------
2008 2007
------------ ------------
(Unaudited) (Unaudited)
Revenues $ 6,388,021 $ 4,513,015
Operating expenses:
Salaries, commission and related taxes 5,776,986 4,093,920
Lead, advertising and other marketing 1,998,733 1,861,584
Depreciation and amortization 715,716 551,106
Rent, utilities, telephone and
communications 811,988 650,739
Professional fees 528,727 260,307
Other general and administrative 518,444 404,121
------------ ------------
10,350,594 7,821,777
------------ ------------
Loss from operations (3,962,573) (3,308,762)
------------ ------------
Other income (expense):
Loss on impairment of property and
equipment (88,922) --
Loss on impairment of intangible asset (295,633) --
Interest income 30,506 49,078
Interest expense (4,610) (8,814)
------------ ------------
Total other income (expense) (358,659) 40,264
------------ ------------
Net loss $ (4,321,232) $ (3,268,498)
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Net loss per common share:
Net loss per common share - basic and
diluted $ (0.12) $ (0.11)
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Weighted average common shares outstanding
- basic and diluted 35,335,465 28,896,388
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HEALTH BENEFITS DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
March 31, December 31,
2008 2007
------------ ------------
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash $ 7,420,494 $ 5,787,585
Accounts receivable, less allowance for
doubtful accounts $35,080 and $59,106 1,732,037 1,720,014
Tax receivable 36,212 --
Deferred compensation advances 345,732 578,372
Prepaid expenses 218,949 182,087
Other current assets 12,193 22,285
------------ ------------
Total current assets 9,765,617 8,290,343
Restricted cash 1,150,000 1,150,000
Property and equipment, net of accumulated
depreciation $1,274,178 and $1,115,562 1,348,983 1,592,480
Intangibles, net of accumulated
amortization $3,416,560 and $3,108,771 4,420,387 5,095,960
Other assets 163,997 165,871
------------ ------------
Total assets $ 16,848,984 $ 16,294,654
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 986,835 $ 1,483,064
Amount payable to private placement
investor
Accrued expenses 1,579,788 1,406,641
Current portion of capital lease
obligations 22,776 14,707
Sub-tenant security deposit 7,301 --
Due to related parties -- 28,500
Unearned commission advances 8,117,836 8,450,585
Deferred revenue 128,875 209,125
Income tax payable -- 157,288
------------ ------------
Total current liabilities 10,843,411 11,749,910
------------ ------------
LONG TERM LIABILITIES:
Capital lease obligations 69,242 44,241
------------ ------------
Total long term liabilities 69,242 44,241
------------ ------------
SHAREHOLDERS' EQUITY:
Preferred stock ($.001 par value;
10,000,000 shares authorized; no shares
issued and outstanding) -- --
Common stock ($.001 par value; 90,000,000
shares authorized; 41,255,635 and
34,951,384 shares issued and outstanding 41,255 34,951
Additional paid-in capital 42,619,165 36,868,409
Accumulated deficit (36,724,089) (32,402,857)
------------ ------------
Total shareholders' equity 5,936,331 4,500,503
------------ ------------
Total liabilities and shareholders'
equity $ 16,848,984 $ 16,294,654
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HEALTH BENEFITS DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended
March 31,
--------------------------
2008 2007
------------ ------------
(Unaudited) (Unaudited)
Cash Flows From Operating Activities:
Net loss $ (4,321,232) $ (3,268,498)
Adjustments to reconcile net loss to net
cash (used in) operating activities:
Depreciation and amortization 715,716 551,106
Stock-based compensation and consulting 854,688 514,861
Loss on impairment of property and
equipment 88,922 --
Loss on impairment of intangible assets 295,633 --
Provision for bad debt (22,029) (25,179)
Changes in assets and liabilities:
Accounts receivable 10,006 813,009
Tax receivable (36,212) --
Deferred compensation advances 232,640 (212,085)
Prepaid expenses (36,862) 4,379
Other current assets 10,092 (16,010)
Other assets 1,874 37,217
Accounts payable (496,229) (135,654)
Accrued expenses 148,143 (87,437)
Sub-tenant security deposit 7,301 --
Due to related parties (28,500) (24,509)
Unearned commission advances (332,749) 1,908,619
Deferred revenue (80,250) --
Income tax payable (157,288) --
------------ ------------
Net cash (used in) operating activities (3,146,336) 59,819
------------ ------------
Cash Flows From Investing Activities:
Purchase of property and equipment (90,595) (176,403)
Purchase of intangible assets and
capitalization of software development (92,993) (193,710)
------------ ------------
Net cash used in investing activities (183,588) (370,113)
------------ ------------
Cash Flows From Financing Activities:
Gross proceeds from capital leases 37,411 --
Payments on capital leases (4,340) --
Gross proceeds from sales of common stock 5,000,000 6,817,500
Gross proceeds from exercise of warrants -- 337,500
Placement and other fees paid in
connection with offering (70,238) --
------------ ------------
Net cash provided by financing
activities 4,962,833 7,155,000
------------ ------------
Net increase in cash 1,632,909 6,844,706
Cash - beginning of the year 5,787,585 2,311,781
------------ ------------
Cash - end of the period $ 7,420,494 $ 9,156,487
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