First Health Reports Record Results 20% EPS Growth

Apr 30, 2001, 01:00 ET from First Health Group Corp.

    DOWNERS GROVE, Ill., April 30 /PRNewswire/ -- James C. Smith, Chairman and
 Chief Executive Officer of First Health Group Corp. (Nasdaq:   FHCC), announced
 today the results of operations for the first quarter ended March 31, 2001.
     Diluted earnings per share for the three months ended March 31, 2001
 increased 20% to a record $.48 or $24,400,000 compared with $.40 or
 $19,612,000 during the same period last year.  Revenues for the three months
 ended March 31, 2001 increased 12% to $136,984,000 from $122,475,000 during
 the same period last year.
     Mr. Smith commented that the addition of new clients on January 1 and the
 effective control of the Company's operating expenses have allowed for a
 strong start to the new year.  As a result of the strong results in the first
 quarter, the Company is currently estimating EPS growth for the year in the
 19%-20% area, up from its previous estimate of 18% EPS growth.
     First Health, the nation's premier full-service national health benefits
 company, specializes in providing large employers with one integrated source
 for group health and workers' compensation.  By combining pioneering
 technology with expert industry knowledge, First Health delivers
 comprehensive, cost-effective solutions for its clients nationally.  For more
 information, visit the company web site at http://www.firsthealth.com.
 
     Certain statements herein regarding anticipated financial results for
 fiscal 2001 and the Company's business and growth prospects are
 forward-looking statements that involve substantial risks and uncertainties.
 In accordance with the Private Securities Litigation Reform Act of 1995,
 factors that could cause the Company's actual results to differ materially
 from those expressed or implied by such forward-looking statements include,
 among others, the inability of the Company to continue to: (i) enter into
 contracts with and successfully implement programs for new clients within the
 time frame established by the Company and achieve the revenue growth expected
 to result from the addition of such clients, (ii) expand its group health,
 workers' compensation and public sector business, (iii) achieve the growth in
 the group health area that is anticipated as a result of the Company's
 strategy of focusing on larger, multi-sited national employers, or (iv)
 control healthcare benefit expenses.  All forward-looking statements herein
 are made as of the date hereof and the Company undertakes no obligation to
 update such statements.
 
                            First Health Group Corp.
                   (000's Omitted Except EPS and Percentages)
                                  (Unaudited)
 
                                            Three Months Ended March 31,
                                                                % Increase
                                        2001            2000    (Decrease)
 
     Revenues                       $136,984        $122,475       12%
 
     Operating Expenses:
      Cost of Services                59,737          55,435        8%
      Selling and Mktg.               12,944          11,473       13%
      General and Admin.               8,370           8,725      (4)%
      Healthcare Benefits              3,703           2,359       57%
                                      84,754          77,992        9%
 
     Operating Income                 52,230          44,483       17%
 
     Depreciation and
      Amortization                    10,602           9,113       16%
     Interest Income                 (1,851)         (1,557)       19%
     Interest Expense                  2,471           3,966     (38)%
     Income Before
      Income Taxes                    41,008          32,961       24%
     Income Taxes                   (16,608)        (13,349)       24%
 
     Net Income                      $24,400         $19,612       24%
 
     Weighted Average Shares
      Outstanding-Basic               48,363          47,712        1%
     Net Income Per Common
      Share-Basic                       $.50            $.41       22%
     Weighted Average Shares
      Outstanding-Diluted             50,849          49,531        3%
     Net Income Per Common
      Share-Diluted                     $.48            $.40       20%
 
                            First Health Group Corp.
                       (000's Omitted Except Percentages)
                                  (Unaudited)
 
                                            Three Months Ended March 31,
                                                                % Increase
                                        2001            2000    (Decrease)
     Revenue Information:
     Sources of Revenue:
 
      PPO Services                   $75,711         $64,917       17%
      Claims Administration           41,545          37,545       11%
      Clinical Mgmt. Services          7,087           7,711      (8)%
      Fee Schedule Services            8,754           8,958      (2)%
      Premiums & Related               3,887           2,908       34%
      Service                             --             436    (100)%
 
     Total Revenue                  $136,984       $ 122,475       12%
 
 
     Summary Balance Sheet Information:
                                                    March 31,   December 31,
                                                         2001           2000
 
      Cash and Investments                           $130,398       $127,582
      Accounts Receivable                              58,604         57,137
      Reinsurance Recoverable                          29,616         31,282
      Fixed Assets                                    165,474        155,717
      Goodwill                                         89,109         89,975
      Other Assets                                     30,644         29,903
 
         Total Assets                                $503,845       $491,596
 
     Claims Reserves                                  $39,184        $41,228
     Long-Term Debt                                   100,000        127,500
     Other Liabilities                                148,312        141,455
     Stockholders' Equity                             216,349        181,413
 
        Total Liabilities and
         Stockholders' Equity                        $503,845       $491,596
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X36806445
 
 

SOURCE First Health Group Corp.
    DOWNERS GROVE, Ill., April 30 /PRNewswire/ -- James C. Smith, Chairman and
 Chief Executive Officer of First Health Group Corp. (Nasdaq:   FHCC), announced
 today the results of operations for the first quarter ended March 31, 2001.
     Diluted earnings per share for the three months ended March 31, 2001
 increased 20% to a record $.48 or $24,400,000 compared with $.40 or
 $19,612,000 during the same period last year.  Revenues for the three months
 ended March 31, 2001 increased 12% to $136,984,000 from $122,475,000 during
 the same period last year.
     Mr. Smith commented that the addition of new clients on January 1 and the
 effective control of the Company's operating expenses have allowed for a
 strong start to the new year.  As a result of the strong results in the first
 quarter, the Company is currently estimating EPS growth for the year in the
 19%-20% area, up from its previous estimate of 18% EPS growth.
     First Health, the nation's premier full-service national health benefits
 company, specializes in providing large employers with one integrated source
 for group health and workers' compensation.  By combining pioneering
 technology with expert industry knowledge, First Health delivers
 comprehensive, cost-effective solutions for its clients nationally.  For more
 information, visit the company web site at http://www.firsthealth.com.
 
     Certain statements herein regarding anticipated financial results for
 fiscal 2001 and the Company's business and growth prospects are
 forward-looking statements that involve substantial risks and uncertainties.
 In accordance with the Private Securities Litigation Reform Act of 1995,
 factors that could cause the Company's actual results to differ materially
 from those expressed or implied by such forward-looking statements include,
 among others, the inability of the Company to continue to: (i) enter into
 contracts with and successfully implement programs for new clients within the
 time frame established by the Company and achieve the revenue growth expected
 to result from the addition of such clients, (ii) expand its group health,
 workers' compensation and public sector business, (iii) achieve the growth in
 the group health area that is anticipated as a result of the Company's
 strategy of focusing on larger, multi-sited national employers, or (iv)
 control healthcare benefit expenses.  All forward-looking statements herein
 are made as of the date hereof and the Company undertakes no obligation to
 update such statements.
 
                            First Health Group Corp.
                   (000's Omitted Except EPS and Percentages)
                                  (Unaudited)
 
                                            Three Months Ended March 31,
                                                                % Increase
                                        2001            2000    (Decrease)
 
     Revenues                       $136,984        $122,475       12%
 
     Operating Expenses:
      Cost of Services                59,737          55,435        8%
      Selling and Mktg.               12,944          11,473       13%
      General and Admin.               8,370           8,725      (4)%
      Healthcare Benefits              3,703           2,359       57%
                                      84,754          77,992        9%
 
     Operating Income                 52,230          44,483       17%
 
     Depreciation and
      Amortization                    10,602           9,113       16%
     Interest Income                 (1,851)         (1,557)       19%
     Interest Expense                  2,471           3,966     (38)%
     Income Before
      Income Taxes                    41,008          32,961       24%
     Income Taxes                   (16,608)        (13,349)       24%
 
     Net Income                      $24,400         $19,612       24%
 
     Weighted Average Shares
      Outstanding-Basic               48,363          47,712        1%
     Net Income Per Common
      Share-Basic                       $.50            $.41       22%
     Weighted Average Shares
      Outstanding-Diluted             50,849          49,531        3%
     Net Income Per Common
      Share-Diluted                     $.48            $.40       20%
 
                            First Health Group Corp.
                       (000's Omitted Except Percentages)
                                  (Unaudited)
 
                                            Three Months Ended March 31,
                                                                % Increase
                                        2001            2000    (Decrease)
     Revenue Information:
     Sources of Revenue:
 
      PPO Services                   $75,711         $64,917       17%
      Claims Administration           41,545          37,545       11%
      Clinical Mgmt. Services          7,087           7,711      (8)%
      Fee Schedule Services            8,754           8,958      (2)%
      Premiums & Related               3,887           2,908       34%
      Service                             --             436    (100)%
 
     Total Revenue                  $136,984       $ 122,475       12%
 
 
     Summary Balance Sheet Information:
                                                    March 31,   December 31,
                                                         2001           2000
 
      Cash and Investments                           $130,398       $127,582
      Accounts Receivable                              58,604         57,137
      Reinsurance Recoverable                          29,616         31,282
      Fixed Assets                                    165,474        155,717
      Goodwill                                         89,109         89,975
      Other Assets                                     30,644         29,903
 
         Total Assets                                $503,845       $491,596
 
     Claims Reserves                                  $39,184        $41,228
     Long-Term Debt                                   100,000        127,500
     Other Liabilities                                148,312        141,455
     Stockholders' Equity                             216,349        181,413
 
        Total Liabilities and
         Stockholders' Equity                        $503,845       $491,596
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X36806445
 
 SOURCE  First Health Group Corp.