Chronimed Reports Third Quarter Results for Fiscal 2001; Record Revenues; Operating Expense Trend Continues to Improve; Also Announces Closing Of Transplant Pharmacy Acquisition

Apr 24, 2001, 01:00 ET from Chronimed Inc.

    MINNEAPOLIS, April 24 /PRNewswire Interactive News Release/ --
     Chronimed Inc. (Nasdaq:   CHMD) reported record revenue for the third fiscal
 quarter of 2001 of $79.3 million, up $24.2 million or 44 percent over last
 year's adjusted third quarter results.  Comparable earnings per diluted share
 from continuing operations grew to nine cents versus seven cents last year, a
 29 percent increase.
     Henry F. Blissenbach, Chronimed's chairman and chief executive officer,
 commented, "We achieved several strategic objectives during the quarter.
 First, we significantly strengthened our business with two key acquisitions
 that will improve our position in the HIV and organ transplant markets.
 Second, all business lines showed exciting year-over-year revenue growth, with
 our injectables line up an impressive 68 percent on the strength of sales into
 several diseases such as multiple sclerosis, RSV, rheumatoid arthritis and
 hepatitis-C.  Finally, we continued our trend of lowering operating costs as a
 percent of revenue.  For the quarter, our operating expense was 11.3 percent
 of revenue, down more than 40 basis points from the second quarter and down
 over 300 basis points from last year's adjusted third quarter results."
     Gregory H. Keane, Chronimed's Chief Financial Officer, commented on the
 financial results of the business:  "Despite continued reimbursement pressures
 in the quarter from several key payors, we generated year-over-year and
 sequential quarter gains.  We believe that as we increase market share, while
 reducing operating expenses, we will continue to improve our earnings
 performance in fiscal 2002."
     The Company also provided revenue and earnings expectations for the rest
 of fiscal 2001 and full year fiscal 2002.  For the fourth quarter, revenue is
 expected to be in the range of $82 to $85 million, up more than 50 percent
 over last year's adjusted fourth quarter, with earnings of 10 to 11 cents per
 diluted share, roughly double last year's fourth quarter adjusted results of
 five cents.  This would result in total fiscal year 2001 adjusted revenue of
 $294 to $297 million from continuing operations, with adjusted earnings per
 diluted share of 34 to 35 cents, excluding any non-operating gains or losses
 on the sale of securities.  For next full fiscal year ending June 2002, the
 Company reiterated its revenue and earnings growth targets of 25 to
 30 percent.
     Chronimed also reported a non-operating loss on the sale of securities of
 $250,000 before income taxes and $153,000 after income taxes.  These
 securities were received as partial consideration from Chronimed's sale of its
 MEDgenesis diagnostic products business on January 5, 2001 to Medisys PLC, a
 UK company.  Through March 30, 2001, Chronimed has sold 2.351 million shares
 for $4.4 million in cash, which resulted in the $250,000 loss.  As of
 March 30, 2001, Chronimed held 2.429 million shares at a market value of
 approximately $2.5 million, with an unrealized loss of $2.3 million being
 carried against shareholders' equity.  Should Chronimed divest its position in
 Medisys shares, any realized losses or gains will be charged against earnings
 as a non-operating item.  Because they are difficult to predict and are of a
 non-operating nature, such losses or gains are excluded from earnings
 projections.
     In an unrelated matter, Chronimed announced the closing of its previously
 announced purchase of The Transplant Pharmacy(R) from SangStat (Nasdaq:   SANG).
 The transaction closed Friday, April 20, 2001.  Chronimed acquired the
 transplant drug distribution business from SangStat, paying cash for
 substantially all assets, excluding inventory and receivables.
     Chronimed invites interested parties to participate in the third quarter
 conference call on Wednesday, April 25, 2001, 9:00 a.m. Central Daylight Time.
 To participate in the conference call, dial 212-676-5002 at least five minutes
 prior to the scheduled time, and follow the operator's instructions.  The
 conference call will also be Webcast live over the Internet.  To participate,
 logon to the Company's website at http://www.chronimed.com
     If you are unable to join the live call, it will be archived on
 Chronimed's website.  In addition, a recording of the conference call will be
 available through an Instant Replay Service for a 24-hour period beginning at
 11:00 a.m. CDT.  To access the replay during this period, call 800-633-8284
 and enter the Reservation Number 18641523, followed by the "#" key.
     Chronimed Inc. is a disease-focused drug distribution company serving the
 prescription drug needs of people with chronic health conditions.  The Company
 distributes pharmaceuticals and provides specialized patient management
 services nationwide for people with long-term chronic conditions such as
 HIV/AIDS, organ transplant and diseases treated with biotech injectable
 medications.  Chronimed works directly with patients, providers, payors,
 manufacturers and wholesalers to improve clinical and cost-of-care outcomes.
 
     As a cautionary note to investors, certain matters discussed in this press
 release are forward-looking statements within the meaning of the Private
 Securities Litigation Reform Act of 1995.  Such matters involve risks and
 uncertainties that may cause actual results to differ materially, including
 the following:  changes in economic conditions; general competitive factors;
 pressures on gross profit margins; the Company's ability to execute its sales
 and marketing plans; changes in the status of managed care contracts,
 particularly but not limited to Aetna U.S. Healthcare; changes in ownership;
 material litigation; gains or losses on the sale of available-for-sale
 securities; performance of acquired businesses; and the risks described from
 time to time in the Company's public reports filed with the SEC.
 
 
     Adjusted Income Statements
     (In thousands, except per share data)
     (Unaudited)
 
                             Third Quarter Ended         Nine Months Ended
                            March 30,     March 31,    March 30,    March 31,
                              2001          2000         2001         2000
     Revenue
     -- as adjusted         $79,343       $55,142(a)  $212,212(b)  $155,574(c)
          % increase             44%                        36%
 
     -- as reported         $79,343       $57,596     $214,442     $166,820
          % increase             38%                        29%
 
     Pre-Tax Income from Operations
 
      -- as adjusted         $1,550        $1,485(d)    $4,820(e)    $2,728(f)
      -- as reported         $1,550       $(4,098)      $4,626      $(2,686)
 
 
     Net Income after Tax
       -- Continuing
           Operations as
           adjusted          $1,116(g)       $880(g)    $3,113(g)    $1,588(g)
       -- Strategic
           alternative expenses  --           (30)          --         (568)
       -- Loss on sale of
           securities          (153)(h)        --         (153)(h)       --
       -- Write-down of
           Clinical Partners
           contracts line        --        (3,355)          --       (3,355)
       -- Home Service
           Medical (loss)
           income                --           (21)        (114)         620
     Total Continuing
      Operations as
      reported                 $963       $(2,526)      $2,846      $(1,715)
 
       -- Discontinued
           Operations          $(81)         $346       $1,464       $1,429
       -- Gain on Sale of
           Discontinued
           Operations        12,836                     12,836
       -- Gain on sale of
           securities            --           289(i)        --          289(i)
     Total Discontinued
      Operations as
      reported              $12,755          $635      $14,300       $1,718
 
     Total Net Income
      (Loss) as reported    $13,718       $(1,891)     $17,146           $3
 
 
     Diluted Earnings
      per Share:
       -- Continuing
           Operations as
           adjusted           $0.09         $0.07        $0.25        $0.13
       -- Strategic
           alternative
           expenses              --            --           --        (0.04)
       -- Loss on sale
           of securities      (0.01)           --        (0.01)          --
       -- Write-off of
           Clinical
           Partners
           contracts line        --         (0.28)          --        (0.28)
       -- Home Service
           Medical income
           (loss)                --            --        (0.01)        0.05
     Total Continuing
      Operations as
      reported                $0.08        $(0.21)       $0.23       $(0.14)
 
       -- Discontinued
           Operations        $(0.01)        $0.03        $0.12        $0.12
       -- Gain on Sale
           of Discontinued
           Operations          1.01            --         1.04           --
       -- Gain on sale
           of securities         --          0.02           --         0.02
     Total Discontinued
      Operations as
      reported                $1.00         $0.05        $1.16        $0.14
 
     Total Net Income
      (Loss) as reported      $1.08        $(0.16)       $1.39        $0.00
 
     Average Shares
      Outstanding --
      Diluted                12,670        12,133       12,341       12,106
 
     (a) Excludes Home Service Medical ("HSM") revenue of $2,454
     (b) Excludes HSM revenue of $2,230
     (c) Excludes HSM revenue of $11,246
     (d) Excludes the charge of $5,500 before tax ($3,355 after tax) to
         write-off goodwill and restructuring charges for Clinical Partner's
         contracts management line, $49 before tax ($30 after tax) for
         strategic alternative costs, and HSM loss of $(34) before tax ($(21)
         after tax).
     (e) Excludes HSM loss of $(194) before tax ($(114) after tax)
     (f) Excludes the charge of $5,500 before tax ($3,355 after tax) to
         write-off goodwill and restructuring charges for Clinical Partner's
         contracts management line, $931 before tax ($568 after tax) for
         strategic alternative costs, and HSM income of $1,017 before tax ($620
         after tax).
     (g) Includes interest income and expense and other income for the
         respective period
     (h) Loss of $(250) before tax ($(153) after tax) on the sale of
         available-for-sale securities.
     (i) Gain of $474 before tax ($289 after tax) on the sale of
         available-for-sale securities.
 
 
     Consolidated Statements of Income
     (In thousands, except per share amounts)
     (Unaudited)
 
                               Quarter Ended           Nine Months Ended
                           March 30,     March 31,    March 30,      March 31,
                              2001          2000        2001           2000
     Revenues
      Mail Order            $39,422       $29,386     $113,891       $88,369
      Retail                 39,921        28,210      100,551        78,451
       Total Revenue         79,343        57,596      214,442       166,820
          Yr to Yr Growth        38%                        29%
     Costs and Expenses
      Cost of revenues       68,863        47,463      184,304       136,452
       Gross profit          10,480        10,133       30,138        30,368
          % of Revenue         13.2%         17.6%        14.1%         18.2%
 
      Selling and marketing     700         1,127        2,472         3,380
      General and
       administrative         8,230         7,604       23,040        24,174
      Other expense -
       Clinical Partners
       write-off                 --         5,500           --         5,500
       Total operating
        expenses              8,930        14,231       25,512        33,054
          % of Revenue         11.3%         24.7%        11.9%         19.8%
 
     Income (Loss) from
      Operations              1,550        (4,098)       4,626        (2,686)
          % of Revenue          2.0%         -7.1%         2.2%         -1.6%
 
      Interest income           289             8          472            28
      Interest (expense)        (11)          (51)         (91)         (153)
      Other (expense)          (250)           --         (238)           --
 
     Income (Loss) before
      Income Taxes            1,578        (4,141)       4,769        (2,811)
      Income tax (expense)
       benefit                 (615)        1,615       (1,923)        1,096
 
     Income (Loss) from
      Continuing Operations     963        (2,526)       2,846        (1,715)
          % of Revenue          1.2%         -4.4%         1.3%         -1.0%
 
     Discontinued Operations
      (Loss) Income from
       Discontinued
       Operations, net
       of tax                   (81)          635        1,464         1,718
      Gain on sale of
       Discontinued
        Operations, net
        of tax               12,836            --       12,836            --
 
     Net Income (Loss)      $13,718       $(1,891)     $17,146            $3
          % of Revenue         17.3%         -3.3%         8.0%          0.0%
 
     Basic Earnings (Loss)
      per Share:
      Income (Loss) from
       Continuing Operations  $0.08        $(0.21)       $0.23        $(0.14)
      Income/Gain from
       Discontinued
       Operations              1.04          0.05         1.18          0.14
      Net Income (Loss)
       per share              $1.12        $(0.16)       $1.41         $0.00
 
     Diluted Earnings (Loss)
      per Share:
      Income (Loss) from
       Continuing Operations  $0.08        $(0.21)       $0.23        $(0.14)
      Income/Gain from
       Discontinued
       Operations              1.00          0.05         1.16          0.14
      Net Income (Loss)
       per share              $1.08        $(0.16)       $1.39         $0.00
 
     Average Shares
      Outstanding -- Basic   12,222        12,133       12,174        12,106
     Average Shares
      Outstanding -- Diluted 12,670        12,133       12,341        12,106
 
 
     Consolidated Balance Sheets
     (In thousands)
 
                                                March 30, 2001    June 30, 2000
     Assets                                       (Unaudited)
     Current assets:
      Cash and cash equivalents                        $9,662            $--
      Available-for-sale securities                     2,541             --
      Accounts receivable, net                         56,556         47,352
      Income taxes receivable                              --            774
      Inventory                                         6,661          6,111
      Other current assets                              1,105            848
      Deferred taxes                                    1,311          1,311
       Total current assets                            77,836         56,396
 
     Property and equipment:
      Property and equipment                           16,229         14,889
      Allowance for depreciation                       (9,226)        (8,338)
                                                        7,003          6,551
 
     Goodwill, net                                     23,828          9,031
     Net assets of discontinued operations                 --         10,465
     Deferred taxes                                       508            508
     Other assets                                         156            109
      Total assets                                   $109,331        $83,060
 
     Liabilities and shareholders' equity
     Current liabilities:
      Accounts payable                                $13,353        $10,507
      Accrued expenses                                  3,243          2,366
      Income taxes payable                              8,794             --
      Short-term debt                                      --          2,500
       Total current liabilities                       25,390         15,373
 
     Shareholders' equity:
      Preferred Stock                                      --             --
      Common Stock, issued and outstanding
       shares -- 12,295 and 12,147 respectively           123            121
      Additional paid-in capital                       54,687         52,839
      Retained earnings                                31,417         14,271
                                                       86,227         67,231
     Accumulated other comprehensive income --
      Unrealized (loss) gain on
       available-for-sale securities                   (2,286)           456
      Total shareholders' equity                       83,941         67,687
 
     Total liabilities and shareholders' equity      $109,331        $83,060
 
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SOURCE Chronimed Inc.
    MINNEAPOLIS, April 24 /PRNewswire Interactive News Release/ --
     Chronimed Inc. (Nasdaq:   CHMD) reported record revenue for the third fiscal
 quarter of 2001 of $79.3 million, up $24.2 million or 44 percent over last
 year's adjusted third quarter results.  Comparable earnings per diluted share
 from continuing operations grew to nine cents versus seven cents last year, a
 29 percent increase.
     Henry F. Blissenbach, Chronimed's chairman and chief executive officer,
 commented, "We achieved several strategic objectives during the quarter.
 First, we significantly strengthened our business with two key acquisitions
 that will improve our position in the HIV and organ transplant markets.
 Second, all business lines showed exciting year-over-year revenue growth, with
 our injectables line up an impressive 68 percent on the strength of sales into
 several diseases such as multiple sclerosis, RSV, rheumatoid arthritis and
 hepatitis-C.  Finally, we continued our trend of lowering operating costs as a
 percent of revenue.  For the quarter, our operating expense was 11.3 percent
 of revenue, down more than 40 basis points from the second quarter and down
 over 300 basis points from last year's adjusted third quarter results."
     Gregory H. Keane, Chronimed's Chief Financial Officer, commented on the
 financial results of the business:  "Despite continued reimbursement pressures
 in the quarter from several key payors, we generated year-over-year and
 sequential quarter gains.  We believe that as we increase market share, while
 reducing operating expenses, we will continue to improve our earnings
 performance in fiscal 2002."
     The Company also provided revenue and earnings expectations for the rest
 of fiscal 2001 and full year fiscal 2002.  For the fourth quarter, revenue is
 expected to be in the range of $82 to $85 million, up more than 50 percent
 over last year's adjusted fourth quarter, with earnings of 10 to 11 cents per
 diluted share, roughly double last year's fourth quarter adjusted results of
 five cents.  This would result in total fiscal year 2001 adjusted revenue of
 $294 to $297 million from continuing operations, with adjusted earnings per
 diluted share of 34 to 35 cents, excluding any non-operating gains or losses
 on the sale of securities.  For next full fiscal year ending June 2002, the
 Company reiterated its revenue and earnings growth targets of 25 to
 30 percent.
     Chronimed also reported a non-operating loss on the sale of securities of
 $250,000 before income taxes and $153,000 after income taxes.  These
 securities were received as partial consideration from Chronimed's sale of its
 MEDgenesis diagnostic products business on January 5, 2001 to Medisys PLC, a
 UK company.  Through March 30, 2001, Chronimed has sold 2.351 million shares
 for $4.4 million in cash, which resulted in the $250,000 loss.  As of
 March 30, 2001, Chronimed held 2.429 million shares at a market value of
 approximately $2.5 million, with an unrealized loss of $2.3 million being
 carried against shareholders' equity.  Should Chronimed divest its position in
 Medisys shares, any realized losses or gains will be charged against earnings
 as a non-operating item.  Because they are difficult to predict and are of a
 non-operating nature, such losses or gains are excluded from earnings
 projections.
     In an unrelated matter, Chronimed announced the closing of its previously
 announced purchase of The Transplant Pharmacy(R) from SangStat (Nasdaq:   SANG).
 The transaction closed Friday, April 20, 2001.  Chronimed acquired the
 transplant drug distribution business from SangStat, paying cash for
 substantially all assets, excluding inventory and receivables.
     Chronimed invites interested parties to participate in the third quarter
 conference call on Wednesday, April 25, 2001, 9:00 a.m. Central Daylight Time.
 To participate in the conference call, dial 212-676-5002 at least five minutes
 prior to the scheduled time, and follow the operator's instructions.  The
 conference call will also be Webcast live over the Internet.  To participate,
 logon to the Company's website at http://www.chronimed.com
     If you are unable to join the live call, it will be archived on
 Chronimed's website.  In addition, a recording of the conference call will be
 available through an Instant Replay Service for a 24-hour period beginning at
 11:00 a.m. CDT.  To access the replay during this period, call 800-633-8284
 and enter the Reservation Number 18641523, followed by the "#" key.
     Chronimed Inc. is a disease-focused drug distribution company serving the
 prescription drug needs of people with chronic health conditions.  The Company
 distributes pharmaceuticals and provides specialized patient management
 services nationwide for people with long-term chronic conditions such as
 HIV/AIDS, organ transplant and diseases treated with biotech injectable
 medications.  Chronimed works directly with patients, providers, payors,
 manufacturers and wholesalers to improve clinical and cost-of-care outcomes.
 
     As a cautionary note to investors, certain matters discussed in this press
 release are forward-looking statements within the meaning of the Private
 Securities Litigation Reform Act of 1995.  Such matters involve risks and
 uncertainties that may cause actual results to differ materially, including
 the following:  changes in economic conditions; general competitive factors;
 pressures on gross profit margins; the Company's ability to execute its sales
 and marketing plans; changes in the status of managed care contracts,
 particularly but not limited to Aetna U.S. Healthcare; changes in ownership;
 material litigation; gains or losses on the sale of available-for-sale
 securities; performance of acquired businesses; and the risks described from
 time to time in the Company's public reports filed with the SEC.
 
 
     Adjusted Income Statements
     (In thousands, except per share data)
     (Unaudited)
 
                             Third Quarter Ended         Nine Months Ended
                            March 30,     March 31,    March 30,    March 31,
                              2001          2000         2001         2000
     Revenue
     -- as adjusted         $79,343       $55,142(a)  $212,212(b)  $155,574(c)
          % increase             44%                        36%
 
     -- as reported         $79,343       $57,596     $214,442     $166,820
          % increase             38%                        29%
 
     Pre-Tax Income from Operations
 
      -- as adjusted         $1,550        $1,485(d)    $4,820(e)    $2,728(f)
      -- as reported         $1,550       $(4,098)      $4,626      $(2,686)
 
 
     Net Income after Tax
       -- Continuing
           Operations as
           adjusted          $1,116(g)       $880(g)    $3,113(g)    $1,588(g)
       -- Strategic
           alternative expenses  --           (30)          --         (568)
       -- Loss on sale of
           securities          (153)(h)        --         (153)(h)       --
       -- Write-down of
           Clinical Partners
           contracts line        --        (3,355)          --       (3,355)
       -- Home Service
           Medical (loss)
           income                --           (21)        (114)         620
     Total Continuing
      Operations as
      reported                 $963       $(2,526)      $2,846      $(1,715)
 
       -- Discontinued
           Operations          $(81)         $346       $1,464       $1,429
       -- Gain on Sale of
           Discontinued
           Operations        12,836                     12,836
       -- Gain on sale of
           securities            --           289(i)        --          289(i)
     Total Discontinued
      Operations as
      reported              $12,755          $635      $14,300       $1,718
 
     Total Net Income
      (Loss) as reported    $13,718       $(1,891)     $17,146           $3
 
 
     Diluted Earnings
      per Share:
       -- Continuing
           Operations as
           adjusted           $0.09         $0.07        $0.25        $0.13
       -- Strategic
           alternative
           expenses              --            --           --        (0.04)
       -- Loss on sale
           of securities      (0.01)           --        (0.01)          --
       -- Write-off of
           Clinical
           Partners
           contracts line        --         (0.28)          --        (0.28)
       -- Home Service
           Medical income
           (loss)                --            --        (0.01)        0.05
     Total Continuing
      Operations as
      reported                $0.08        $(0.21)       $0.23       $(0.14)
 
       -- Discontinued
           Operations        $(0.01)        $0.03        $0.12        $0.12
       -- Gain on Sale
           of Discontinued
           Operations          1.01            --         1.04           --
       -- Gain on sale
           of securities         --          0.02           --         0.02
     Total Discontinued
      Operations as
      reported                $1.00         $0.05        $1.16        $0.14
 
     Total Net Income
      (Loss) as reported      $1.08        $(0.16)       $1.39        $0.00
 
     Average Shares
      Outstanding --
      Diluted                12,670        12,133       12,341       12,106
 
     (a) Excludes Home Service Medical ("HSM") revenue of $2,454
     (b) Excludes HSM revenue of $2,230
     (c) Excludes HSM revenue of $11,246
     (d) Excludes the charge of $5,500 before tax ($3,355 after tax) to
         write-off goodwill and restructuring charges for Clinical Partner's
         contracts management line, $49 before tax ($30 after tax) for
         strategic alternative costs, and HSM loss of $(34) before tax ($(21)
         after tax).
     (e) Excludes HSM loss of $(194) before tax ($(114) after tax)
     (f) Excludes the charge of $5,500 before tax ($3,355 after tax) to
         write-off goodwill and restructuring charges for Clinical Partner's
         contracts management line, $931 before tax ($568 after tax) for
         strategic alternative costs, and HSM income of $1,017 before tax ($620
         after tax).
     (g) Includes interest income and expense and other income for the
         respective period
     (h) Loss of $(250) before tax ($(153) after tax) on the sale of
         available-for-sale securities.
     (i) Gain of $474 before tax ($289 after tax) on the sale of
         available-for-sale securities.
 
 
     Consolidated Statements of Income
     (In thousands, except per share amounts)
     (Unaudited)
 
                               Quarter Ended           Nine Months Ended
                           March 30,     March 31,    March 30,      March 31,
                              2001          2000        2001           2000
     Revenues
      Mail Order            $39,422       $29,386     $113,891       $88,369
      Retail                 39,921        28,210      100,551        78,451
       Total Revenue         79,343        57,596      214,442       166,820
          Yr to Yr Growth        38%                        29%
     Costs and Expenses
      Cost of revenues       68,863        47,463      184,304       136,452
       Gross profit          10,480        10,133       30,138        30,368
          % of Revenue         13.2%         17.6%        14.1%         18.2%
 
      Selling and marketing     700         1,127        2,472         3,380
      General and
       administrative         8,230         7,604       23,040        24,174
      Other expense -
       Clinical Partners
       write-off                 --         5,500           --         5,500
       Total operating
        expenses              8,930        14,231       25,512        33,054
          % of Revenue         11.3%         24.7%        11.9%         19.8%
 
     Income (Loss) from
      Operations              1,550        (4,098)       4,626        (2,686)
          % of Revenue          2.0%         -7.1%         2.2%         -1.6%
 
      Interest income           289             8          472            28
      Interest (expense)        (11)          (51)         (91)         (153)
      Other (expense)          (250)           --         (238)           --
 
     Income (Loss) before
      Income Taxes            1,578        (4,141)       4,769        (2,811)
      Income tax (expense)
       benefit                 (615)        1,615       (1,923)        1,096
 
     Income (Loss) from
      Continuing Operations     963        (2,526)       2,846        (1,715)
          % of Revenue          1.2%         -4.4%         1.3%         -1.0%
 
     Discontinued Operations
      (Loss) Income from
       Discontinued
       Operations, net
       of tax                   (81)          635        1,464         1,718
      Gain on sale of
       Discontinued
        Operations, net
        of tax               12,836            --       12,836            --
 
     Net Income (Loss)      $13,718       $(1,891)     $17,146            $3
          % of Revenue         17.3%         -3.3%         8.0%          0.0%
 
     Basic Earnings (Loss)
      per Share:
      Income (Loss) from
       Continuing Operations  $0.08        $(0.21)       $0.23        $(0.14)
      Income/Gain from
       Discontinued
       Operations              1.04          0.05         1.18          0.14
      Net Income (Loss)
       per share              $1.12        $(0.16)       $1.41         $0.00
 
     Diluted Earnings (Loss)
      per Share:
      Income (Loss) from
       Continuing Operations  $0.08        $(0.21)       $0.23        $(0.14)
      Income/Gain from
       Discontinued
       Operations              1.00          0.05         1.16          0.14
      Net Income (Loss)
       per share              $1.08        $(0.16)       $1.39         $0.00
 
     Average Shares
      Outstanding -- Basic   12,222        12,133       12,174        12,106
     Average Shares
      Outstanding -- Diluted 12,670        12,133       12,341        12,106
 
 
     Consolidated Balance Sheets
     (In thousands)
 
                                                March 30, 2001    June 30, 2000
     Assets                                       (Unaudited)
     Current assets:
      Cash and cash equivalents                        $9,662            $--
      Available-for-sale securities                     2,541             --
      Accounts receivable, net                         56,556         47,352
      Income taxes receivable                              --            774
      Inventory                                         6,661          6,111
      Other current assets                              1,105            848
      Deferred taxes                                    1,311          1,311
       Total current assets                            77,836         56,396
 
     Property and equipment:
      Property and equipment                           16,229         14,889
      Allowance for depreciation                       (9,226)        (8,338)
                                                        7,003          6,551
 
     Goodwill, net                                     23,828          9,031
     Net assets of discontinued operations                 --         10,465
     Deferred taxes                                       508            508
     Other assets                                         156            109
      Total assets                                   $109,331        $83,060
 
     Liabilities and shareholders' equity
     Current liabilities:
      Accounts payable                                $13,353        $10,507
      Accrued expenses                                  3,243          2,366
      Income taxes payable                              8,794             --
      Short-term debt                                      --          2,500
       Total current liabilities                       25,390         15,373
 
     Shareholders' equity:
      Preferred Stock                                      --             --
      Common Stock, issued and outstanding
       shares -- 12,295 and 12,147 respectively           123            121
      Additional paid-in capital                       54,687         52,839
      Retained earnings                                31,417         14,271
                                                       86,227         67,231
     Accumulated other comprehensive income --
      Unrealized (loss) gain on
       available-for-sale securities                   (2,286)           456
      Total shareholders' equity                       83,941         67,687
 
     Total liabilities and shareholders' equity      $109,331        $83,060
 
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 SOURCE  Chronimed Inc.