Neoforma's First Quarter 2001 Results Exceed Company Projections

Gross Revenue Increases 138% Over Prior Quarter, Net Revenue 309%, Excluding

Units To Be Divested



Company Continues to Execute In Key Areas



Apr 26, 2001, 01:00 ET from Neoforma.com, Inc.

    SAN JOSE, Calif., April 26 /PRNewswire/ --
 Neoforma.com, Inc. (Nasdaq: NEOF), the leading healthcare supply chain
 solutions company, today announced its financial results for the first quarter
 ended March 31, 2001.  Neoforma builds and operates Internet marketplaces that
 empower healthcare trading partners to optimize supply chain performance.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010420/NEOFORMALOGO )
     The gross volume of transactions through Neoforma's marketplaces for the
 first quarter was $80.8 million, exceeding previously announced estimates by
 21% and representing a record high for the Company.  Neoforma's net revenue
 for the quarter, excluding the results of the business units to be divested,
 was $2.4 million, comprised of $2.3 million in marketplace revenue and
 $93,000 in trading partner services revenue.  Net revenue exceeded previous
 Company estimates by 18%.
     Excluding the business units to be divested, the first quarter results
 represent increases in gross transaction volume of $46.9 million, or 138%, and
 total net revenue of $1.8 million, or 309%, compared to the prior quarter.
     Cash operating expenses for the first quarter, excluding the business
 units to be divested, were $18.8 million, significantly better than the
 estimate of $21 million previously announced by the Company.  On the same
 basis, cash operating expenses for the prior quarter were $19.3 million.
 Total non-cash operating expenses for the first quarter were $35.7 million.
     The net loss for the first quarter, excluding non-cash and non-recurring
 charges and the results of the business units to be divested, was
 $16.5 million, or $0.11 per share, compared to a net loss of $18.5 million, or
 $0.14 per share, for the fourth quarter of 2000.
     Including the results of the business units to be divested, total net
 revenue for the first quarter was $2.8 million.  On the same basis, total cash
 operating expenses were $20.2 million, significantly below the Company's
 previous estimate of $23 million.  The net loss for the first quarter,
 excluding non-cash and non-recurring charges, was $17.5 million, or $0.12 per
 share, compared to $19.4 million, or $0.15 per share, for the prior quarter.
 The total net loss for the quarter was $53.2 million, or $0.36 per share,
 compared to a total net loss of $69.8 million, or $0.54 per share, for the
 prior quarter.
     "Our progress and performance in the first quarter were outstanding and
 lay the foundation for a successful year ahead," says Bob Zollars, chairman
 and chief executive officer of Neoforma.  "We delivered on all of our
 financial and operational goals.  Not only did we surpass our gross
 transaction volume and net revenue projections, we decreased our expenses
 while increasing participation in our marketplaces.  The fact that we did this
 in a challenging economy speaks to the size of our market opportunity and the
 stability of the healthcare industry."
 
     Key Milestones
     In the first quarter, Neoforma continued to execute successfully in
 several strategic areas, including customer traction, strengthened focus,
 financial position and partnerships.
 
     Customer Traction
     To date, 79 healthcare suppliers have joined Neoforma's largest
 marketplace, Marketplace@Novation(TM), representing more than $7.5 billion in
 annual sales to Novation hospital members.  Recent participants include
 healthcare industry giants Abbott Laboratories, Allegiance Healthcare
 Corporation and McKessonHBOC, Inc.
     In addition, a total of 404 hospitals have now chosen
 Marketplace@Novation, the supply chain solution Neoforma built and operates
 for Novation members, as their supply chain solution.  These hospitals
 represent over $9.8 billion in annual supply purchases.  Each hospital has
 contractually committed to purchasing a minimum of 50% of its annual supply
 purchases through Neoforma's solution.
     As of March 31, 2001, Neoforma had connected 156 hospitals to
 Marketplace@Novation, an increase of 91 hospitals since year-end.
 
     Strengthened Focus
     In January 2001, Neoforma announced its intent to divest certain business
 units that are not aligned with its core strategy.  In early April, Neoforma
 sold U.S. Lifeline, Inc., a content services business, to Medical Distribution
 Solution, Inc. (MDSI).  Under the terms of the agreement, Neoforma will
 provide access to MDSI content and services for all of its marketplace trading
 partners, and MDSI will offer exclusive content and service upgrades and will
 share revenue with Neoforma generated by the upgrades.
     The Company's divestiture of General Asset Recovery, a live auction
 business, is pending.  Neoforma expects that the divestiture will be completed
 by the end of the second quarter.
     "Our strengthened focus on our core business contributed to our success in
 the first quarter," says Dan Eckert, president and chief operating officer.
 "We executed on all fronts, while refocusing and streamlining our company to
 build a profitable business for the long term."
     In addition to Marketplace@Novation, Neoforma is building Canadian Health
 Marketplace, a custom online marketplace for the members of Medbuy
 Corporation, Canada's largest national medical group purchasing organization.
 Neoforma also operates a third marketplace, NeoMD(TM), for the alternate site
 healthcare market.
 
     Financial Position
     In January 2001, Neoforma received $30.5 million in equity financing from
 the Company's key strategic partners:  i2 Technologies, Inc., VHA Inc. and
 University HealthSystem Consortium (UHC).  VHA and UHC are the parent
 organizations of Novation.
     In April 2001, Neoforma entered into a $25 million revolving credit
 agreement with VHA.  Under the credit agreement, until May 31, 2002, Neoforma
 may borrow funds up to an amount based on a specified formula dependent on the
 gross volume of transactions through Marketplace@Novation.
     As of March 31, 2001, Neoforma's cash, cash equivalents and investments
 totaled $25.0 million.  Confirming previously issued guidance, the Company
 expects to achieve cash operating income breakeven in the first quarter of
 2002.
 
     Partnerships
     Neoforma established key partnerships with industry-leading companies
 during the first three months of 2001.  The Company forged an important
 strategic relationship with i2 Technologies to develop, deploy and market
 Internet supply chain solutions for healthcare.  Neoforma also formed a
 strategic alliance with Lawson Software to integrate the lawson.insight(TM)
 e-Procurement Service with Neoforma's marketplace solutions.
     In January, Neoforma enhanced its fee structure with Novation to better
 align the interests of the two companies and reflect the value that
 Marketplace@Novation provides suppliers and hospitals.
     "With our solid financial results, stable financial position and continued
 focus on optimizing the healthcare supply chain, Neoforma is well positioned
 for lasting success," adds Zollars.
 
     About Neoforma
     Neoforma builds and operates Internet marketplaces that empower healthcare
 trading partners to optimize supply chain performance.  Neoforma uses proven,
 scalable technologies to provide customized marketplace solutions and services
 that enable customers to maximize their existing technology and supply chain
 relationships.  Healthcare providers, leading group purchasing organizations,
 manufacturers and distributors choose Neoforma as their e-commerce partner.
 For more information, visit the Company's new Web site at www.neoforma.com.
 
     This news release contains forward-looking statements within the meaning
 of Section 27A of the Securities Act of 1933 as amended and Section 21E of the
 Securities Exchange Act of 1934 as amended.  These forward-looking statements
 include statements related to future growth and success, the Company's
 anticipated breakeven date, completions of planned divestitures and benefits
 of completed divestitures of certain business units, and the Company's focus
 on core business.  These forward-looking statements are based on current
 expectations, forecasts and assumptions and involve a number of risks and
 uncertainties that could cause actual results to differ materially from those
 anticipated by these forward-looking statements.  These risks include the
 volatility and unpredictability of the Company's quarterly operating results;
 the ability of the Company to obtain additional financing for its future
 capital needs; the ability of the Company to expand the breadth of products
 and services offered through its online marketplaces; the willingness of
 buyers and sellers of medical products to accept the Company's business model
 of providing an online marketplace for the purchase and sale of medical
 products; the ability of the Company to manage its growth and related
 technological challenges; the Company has a history of losses and may never
 achieve profitability; and the ability of the Company to successfully manage
 its changing relationships with its partners, suppliers and strategic
 customers.  These risks and other risks are described in the Company's
 periodic reports filed with the SEC including its Form 10-K for the year ended
 December 31, 2000, its Form 10-Q for the quarter ended September 30, 2000 and
 its Proxy Statement, dated June 29, 2000, relating to the VHA and UHC
 transactions.  The Company assumes no obligation to update the forward-looking
 information contained in this news release.
 
     NOTE:  Neoforma and Neoforma.com are trademarks of Neoforma.com, Inc.
 Other Neoforma logos, product names and service names are also trademarks of
 Neoforma.com, Inc., which may be registered in other countries.  Other product
 and brand names are trademarks of their respective owners.
 
 
                               NEOFORMA.COM, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share amounts)
 
                                                       For the Quarters Ended
                                                              March 31,
                                                       2000              2001
     REVENUE:
       Marketplace revenue                             $801            $2,270
       Trading partner services & other:
          Trading partner services                      351               542
          Sales of used equipment                        76                --
          Cost of used equipment sold                   (22)               --
            Total trading partner services & other      405               542
              Total revenue                           1,206             2,812
     OPERATING EXPENSES:
       Cost of services                                  --             3,653
       Operations                                     2,660             3,464
       Product development                            4,536             4,559
       Selling and marketing                          9,315             5,984
       General and administrative                     3,460             2,534
       Depreciation and amortization                  3,033            10,420
       Amortization of deferred compensation          8,466             6,329
       Amortization of partnership costs                 --            18,978
       Write-off of acquired in-process
        research and development                      3,000                --
           Total operating expenses                  34,470            55,921
           Loss from operations                     (33,264)          (53,109)
     OTHER INCOME (EXPENSE):
       Interest income                                1,508               321
       Interest expense                                (221)             (303)
       Other income (expense)                            --              (132)
           Net loss                                $(31,977)         $(53,223)
 
     NET LOSS PER SHARE:
       Basic and diluted                             $(0.77)           $(0.36)
       Weighted average shares -- basic and
        diluted                                      41,520           149,474
 
     PRO FORMA NET LOSS PER SHARE:
       Basic and diluted                             $(0.61)           $(0.36)
       Weighted average shares -- basic and
        diluted                                      52,067           149,474
 
     PRO FORMA NET LOSS PER SHARE
      EXCLUDING NON-CASH AND NON-RECURRING
      CHARGES*:
       Basic and diluted                             $(0.34)           $(0.12)
       Weighted average shares -- basic and
        diluted                                      52,067           149,474
 
     * Pro forma net loss per share excluding non-cash and non-recurring
       charges specifically excludes depreciation and amortization,
       amortization of deferred compensation and partnership costs and
       write-off of acquired in-process research and development.
 
 
                               NEOFORMA.COM, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (in thousands)
 
                                          December 31, 2000    March 31, 2001
     Cash, cash equivalents and
      investments                               $29,760           $25,044
     Working capital                               (947)            9,427
     Total assets                               513,938           485,244
     Notes payable, less current portion          7,958             6,841
     Total stockholders' equity                 468,791           455,087
 
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X65755622
 
 

SOURCE Neoforma.com, Inc.
    SAN JOSE, Calif., April 26 /PRNewswire/ --
 Neoforma.com, Inc. (Nasdaq: NEOF), the leading healthcare supply chain
 solutions company, today announced its financial results for the first quarter
 ended March 31, 2001.  Neoforma builds and operates Internet marketplaces that
 empower healthcare trading partners to optimize supply chain performance.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010420/NEOFORMALOGO )
     The gross volume of transactions through Neoforma's marketplaces for the
 first quarter was $80.8 million, exceeding previously announced estimates by
 21% and representing a record high for the Company.  Neoforma's net revenue
 for the quarter, excluding the results of the business units to be divested,
 was $2.4 million, comprised of $2.3 million in marketplace revenue and
 $93,000 in trading partner services revenue.  Net revenue exceeded previous
 Company estimates by 18%.
     Excluding the business units to be divested, the first quarter results
 represent increases in gross transaction volume of $46.9 million, or 138%, and
 total net revenue of $1.8 million, or 309%, compared to the prior quarter.
     Cash operating expenses for the first quarter, excluding the business
 units to be divested, were $18.8 million, significantly better than the
 estimate of $21 million previously announced by the Company.  On the same
 basis, cash operating expenses for the prior quarter were $19.3 million.
 Total non-cash operating expenses for the first quarter were $35.7 million.
     The net loss for the first quarter, excluding non-cash and non-recurring
 charges and the results of the business units to be divested, was
 $16.5 million, or $0.11 per share, compared to a net loss of $18.5 million, or
 $0.14 per share, for the fourth quarter of 2000.
     Including the results of the business units to be divested, total net
 revenue for the first quarter was $2.8 million.  On the same basis, total cash
 operating expenses were $20.2 million, significantly below the Company's
 previous estimate of $23 million.  The net loss for the first quarter,
 excluding non-cash and non-recurring charges, was $17.5 million, or $0.12 per
 share, compared to $19.4 million, or $0.15 per share, for the prior quarter.
 The total net loss for the quarter was $53.2 million, or $0.36 per share,
 compared to a total net loss of $69.8 million, or $0.54 per share, for the
 prior quarter.
     "Our progress and performance in the first quarter were outstanding and
 lay the foundation for a successful year ahead," says Bob Zollars, chairman
 and chief executive officer of Neoforma.  "We delivered on all of our
 financial and operational goals.  Not only did we surpass our gross
 transaction volume and net revenue projections, we decreased our expenses
 while increasing participation in our marketplaces.  The fact that we did this
 in a challenging economy speaks to the size of our market opportunity and the
 stability of the healthcare industry."
 
     Key Milestones
     In the first quarter, Neoforma continued to execute successfully in
 several strategic areas, including customer traction, strengthened focus,
 financial position and partnerships.
 
     Customer Traction
     To date, 79 healthcare suppliers have joined Neoforma's largest
 marketplace, Marketplace@Novation(TM), representing more than $7.5 billion in
 annual sales to Novation hospital members.  Recent participants include
 healthcare industry giants Abbott Laboratories, Allegiance Healthcare
 Corporation and McKessonHBOC, Inc.
     In addition, a total of 404 hospitals have now chosen
 Marketplace@Novation, the supply chain solution Neoforma built and operates
 for Novation members, as their supply chain solution.  These hospitals
 represent over $9.8 billion in annual supply purchases.  Each hospital has
 contractually committed to purchasing a minimum of 50% of its annual supply
 purchases through Neoforma's solution.
     As of March 31, 2001, Neoforma had connected 156 hospitals to
 Marketplace@Novation, an increase of 91 hospitals since year-end.
 
     Strengthened Focus
     In January 2001, Neoforma announced its intent to divest certain business
 units that are not aligned with its core strategy.  In early April, Neoforma
 sold U.S. Lifeline, Inc., a content services business, to Medical Distribution
 Solution, Inc. (MDSI).  Under the terms of the agreement, Neoforma will
 provide access to MDSI content and services for all of its marketplace trading
 partners, and MDSI will offer exclusive content and service upgrades and will
 share revenue with Neoforma generated by the upgrades.
     The Company's divestiture of General Asset Recovery, a live auction
 business, is pending.  Neoforma expects that the divestiture will be completed
 by the end of the second quarter.
     "Our strengthened focus on our core business contributed to our success in
 the first quarter," says Dan Eckert, president and chief operating officer.
 "We executed on all fronts, while refocusing and streamlining our company to
 build a profitable business for the long term."
     In addition to Marketplace@Novation, Neoforma is building Canadian Health
 Marketplace, a custom online marketplace for the members of Medbuy
 Corporation, Canada's largest national medical group purchasing organization.
 Neoforma also operates a third marketplace, NeoMD(TM), for the alternate site
 healthcare market.
 
     Financial Position
     In January 2001, Neoforma received $30.5 million in equity financing from
 the Company's key strategic partners:  i2 Technologies, Inc., VHA Inc. and
 University HealthSystem Consortium (UHC).  VHA and UHC are the parent
 organizations of Novation.
     In April 2001, Neoforma entered into a $25 million revolving credit
 agreement with VHA.  Under the credit agreement, until May 31, 2002, Neoforma
 may borrow funds up to an amount based on a specified formula dependent on the
 gross volume of transactions through Marketplace@Novation.
     As of March 31, 2001, Neoforma's cash, cash equivalents and investments
 totaled $25.0 million.  Confirming previously issued guidance, the Company
 expects to achieve cash operating income breakeven in the first quarter of
 2002.
 
     Partnerships
     Neoforma established key partnerships with industry-leading companies
 during the first three months of 2001.  The Company forged an important
 strategic relationship with i2 Technologies to develop, deploy and market
 Internet supply chain solutions for healthcare.  Neoforma also formed a
 strategic alliance with Lawson Software to integrate the lawson.insight(TM)
 e-Procurement Service with Neoforma's marketplace solutions.
     In January, Neoforma enhanced its fee structure with Novation to better
 align the interests of the two companies and reflect the value that
 Marketplace@Novation provides suppliers and hospitals.
     "With our solid financial results, stable financial position and continued
 focus on optimizing the healthcare supply chain, Neoforma is well positioned
 for lasting success," adds Zollars.
 
     About Neoforma
     Neoforma builds and operates Internet marketplaces that empower healthcare
 trading partners to optimize supply chain performance.  Neoforma uses proven,
 scalable technologies to provide customized marketplace solutions and services
 that enable customers to maximize their existing technology and supply chain
 relationships.  Healthcare providers, leading group purchasing organizations,
 manufacturers and distributors choose Neoforma as their e-commerce partner.
 For more information, visit the Company's new Web site at www.neoforma.com.
 
     This news release contains forward-looking statements within the meaning
 of Section 27A of the Securities Act of 1933 as amended and Section 21E of the
 Securities Exchange Act of 1934 as amended.  These forward-looking statements
 include statements related to future growth and success, the Company's
 anticipated breakeven date, completions of planned divestitures and benefits
 of completed divestitures of certain business units, and the Company's focus
 on core business.  These forward-looking statements are based on current
 expectations, forecasts and assumptions and involve a number of risks and
 uncertainties that could cause actual results to differ materially from those
 anticipated by these forward-looking statements.  These risks include the
 volatility and unpredictability of the Company's quarterly operating results;
 the ability of the Company to obtain additional financing for its future
 capital needs; the ability of the Company to expand the breadth of products
 and services offered through its online marketplaces; the willingness of
 buyers and sellers of medical products to accept the Company's business model
 of providing an online marketplace for the purchase and sale of medical
 products; the ability of the Company to manage its growth and related
 technological challenges; the Company has a history of losses and may never
 achieve profitability; and the ability of the Company to successfully manage
 its changing relationships with its partners, suppliers and strategic
 customers.  These risks and other risks are described in the Company's
 periodic reports filed with the SEC including its Form 10-K for the year ended
 December 31, 2000, its Form 10-Q for the quarter ended September 30, 2000 and
 its Proxy Statement, dated June 29, 2000, relating to the VHA and UHC
 transactions.  The Company assumes no obligation to update the forward-looking
 information contained in this news release.
 
     NOTE:  Neoforma and Neoforma.com are trademarks of Neoforma.com, Inc.
 Other Neoforma logos, product names and service names are also trademarks of
 Neoforma.com, Inc., which may be registered in other countries.  Other product
 and brand names are trademarks of their respective owners.
 
 
                               NEOFORMA.COM, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share amounts)
 
                                                       For the Quarters Ended
                                                              March 31,
                                                       2000              2001
     REVENUE:
       Marketplace revenue                             $801            $2,270
       Trading partner services & other:
          Trading partner services                      351               542
          Sales of used equipment                        76                --
          Cost of used equipment sold                   (22)               --
            Total trading partner services & other      405               542
              Total revenue                           1,206             2,812
     OPERATING EXPENSES:
       Cost of services                                  --             3,653
       Operations                                     2,660             3,464
       Product development                            4,536             4,559
       Selling and marketing                          9,315             5,984
       General and administrative                     3,460             2,534
       Depreciation and amortization                  3,033            10,420
       Amortization of deferred compensation          8,466             6,329
       Amortization of partnership costs                 --            18,978
       Write-off of acquired in-process
        research and development                      3,000                --
           Total operating expenses                  34,470            55,921
           Loss from operations                     (33,264)          (53,109)
     OTHER INCOME (EXPENSE):
       Interest income                                1,508               321
       Interest expense                                (221)             (303)
       Other income (expense)                            --              (132)
           Net loss                                $(31,977)         $(53,223)
 
     NET LOSS PER SHARE:
       Basic and diluted                             $(0.77)           $(0.36)
       Weighted average shares -- basic and
        diluted                                      41,520           149,474
 
     PRO FORMA NET LOSS PER SHARE:
       Basic and diluted                             $(0.61)           $(0.36)
       Weighted average shares -- basic and
        diluted                                      52,067           149,474
 
     PRO FORMA NET LOSS PER SHARE
      EXCLUDING NON-CASH AND NON-RECURRING
      CHARGES*:
       Basic and diluted                             $(0.34)           $(0.12)
       Weighted average shares -- basic and
        diluted                                      52,067           149,474
 
     * Pro forma net loss per share excluding non-cash and non-recurring
       charges specifically excludes depreciation and amortization,
       amortization of deferred compensation and partnership costs and
       write-off of acquired in-process research and development.
 
 
                               NEOFORMA.COM, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (in thousands)
 
                                          December 31, 2000    March 31, 2001
     Cash, cash equivalents and
      investments                               $29,760           $25,044
     Working capital                               (947)            9,427
     Total assets                               513,938           485,244
     Notes payable, less current portion          7,958             6,841
     Total stockholders' equity                 468,791           455,087
 
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X65755622
 
 SOURCE  Neoforma.com, Inc.