HLTH Corporation Announces Second Quarter Financial Results

* Reuters is not responsible for the content in this press release.

Tue Aug 5, 2008 4:00pm EDT

ELMWOOD PARK, N.J., Aug. 5 /PRNewswire-FirstCall/ -- HLTH Corporation
(Nasdaq: HLTH) today announced financial results for the three months ended
June 30, 2008.
    Martin J. Wygod, Chairman and Acting Chief Executive Officer of HLTH
Corporation, said: "We firmly believe that the size and breadth of the overall
market opportunity remains unchanged. With its unique set of assets and
industry leadership, WebMD is well positioned to capitalize on the shift to
online marketing and education to both consumers as well as physicians both
here in the U.S. and abroad."
    Consolidated Financial Highlights
    Revenue for the second quarter was $89.1 million, an increase of 15% over
the prior year. Earnings before interest, taxes, non-cash and other items
("Adjusted EBITDA") for the second quarter was $14.3 million, an increase of
66% over the prior year. Income from continuing operations for the second
quarter was $0.8 million or $0.00 per share, loss from discontinued operations
was $3.7 million or $0.02 per share and net loss was $2.9 million or $0.02 per
share.
    At June 30, 2008, HLTH had approximately $1.4 billion in cash and
investments, of which $325 million is attributable to WebMD.
    Segment Operating Results
    WebMD Online Services segment revenue was $84.6 million for the second
quarter compared to $72.9 million in the prior year period, an increase of
16%. Advertising and sponsorship revenue increased 19% to $62.4 million.
Private portal licensing revenue increased 10% to $21.9 million. Online
Services segment Adjusted EBITDA increased 34% to $18.8 million compared to
$14.0 million in the prior year period.
    WebMD Publishing and Other Services segment revenue was $4.6 million for
the second quarter compared to $4.4 million in the prior year period, an
increase of 5%. Publishing and Other Services segment Adjusted EBITDA was $1.0
million compared to $0.86 million in the prior year period.
    Discontinued Operations
    HLTH's financial results present the ViPS and Porex businesses as
discontinued operations in the current and prior year periods, reflecting the
decision to divest these businesses. The sale of the ViPS business was
completed on July 22, 2008 for $225 million in cash. WebMD's offline
professional medical reference and textbook publication business is presented
as a discontinued operation in the prior year period, reflecting the sale of
that business on December 31, 2007.
    Discontinued operations during the quarter included the results of
operations of ViPS and Porex as well as an additional pre-tax charge of $17
million relating to HLTH's obligation to advance the legal costs of certain
former officers of the Practice Services subsidiary which HLTH sold in 2006.
As of June 30, 2008, this accrual totaled $58 million. As previously reported,
several insurance carriers who had issued D&O insurance to HLTH have refused
to advance these costs and HLTH commenced an action against these carriers to
enforce its rights. On July 31, 2008 the Superior Court for the State of
Delaware granted HLTH's motion for partial summary judgment to enforce the
duty of such carriers to advance and reimburse these costs.
    Merger with WebMD
    As previously announced, HLTH and WebMD entered into a definitive merger
agreement on February 20, 2008. Completion of the merger is conditioned upon,
among other things, approval of the stockholders of both HLTH and WebMD. HLTH
and WebMD expect to file a joint preliminary proxy statement/prospectus
relating to the merger shortly after the filing of their respective second
quarter Form 10-Q filings. Assuming that timely clearance is received from the
SEC, HLTH and WebMD expect to be in a position to hold stockholder meetings in
October 2008 to seek the necessary stockholder approvals. Those meetings would
also be the Annual Meetings for HLTH and WebMD.
    Financial Guidance
    WebMD reaffirmed its financial guidance for the remainder of 2008 today.
HLTH is not providing consolidated financial guidance for 2008 at this time
due to its pending merger with WebMD.
    Analyst and Investor Conference Call
    As previously announced, HLTH and WebMD will host a conference call at
4:45 pm (Eastern) today to discuss their respective second quarter results.
Investors can access the call via webcast at www.hlth.com (in the Investor
Relations section). A replay of the call will be available at the same web
address.
    About HLTH
    HLTH Corporation (NASDAQ: HLTH) owns approximately 84% of WebMD Health
Corp. (NASDAQ: WBMD). WebMD is the leading provider of health information
services, serving consumers, physicians, healthcare professionals, employers
and health plans through its public and private online portals and health-
focused publications.  HLTH also owns Porex, a developer, manufacturer and
distributor of proprietary porous plastic products and components used in
healthcare, industrial and consumer applications.
    This press release does not constitute an offer of any securities for
sale. In connection with the proposed merger, HLTH and WebMD expect to file,
with the SEC, a proxy statement/prospectus as part of a registration statement
regarding the proposed transaction. Investors and security holders are urged
to read the proxy statement/prospectus because it will contain important
information about HLTH and WebMD and the proposed transaction. Investors and
security holders may obtain a free copy of the definitive proxy
statement/prospectus and other documents when filed by HLTH and WebMD with the
SEC at www.sec.gov or www.hlth.com or www.wbmd.com. Investors and security
holders are urged to read the proxy statement, prospectus and other relevant
material when they become available before making any voting or investment
decisions with respect to the merger.
    All statements contained in this press release and the related analyst and
investor conference call, other than statements of historical fact, are
forward-looking statements, including those regarding:  expectations regarding
the market for HLTH's and WebMD's investments in auction rate securities
(ARS); our guidance on HLTH's and WebMD's future financial results and other
projections or measures of their future performance; market opportunities and
WebMD's ability to capitalize on them; the benefits expected from new products
or services and from other potential sources of additional revenue; the merger
transaction between HLTH and WebMD (the "Merger Transaction"); and the
potential sale transaction with respect to Porex (the "Potential Sale
Transaction").  These statements speak only as of the date of this press
release, are based on HLTH's and WebMD's current plans and expectations, and
involve risks and uncertainties that could cause actual future events or
results to be different than those described in or implied by such forward-
looking statements.  These risks and uncertainties include those relating to:
changes in the markets for ARS; market acceptance of WebMD's products and
services; WebMD's relationships with customers and strategic partners; and
changes in economic, political or regulatory conditions or other trends
affecting the healthcare, Internet, information technology and plastics
industries.  Further information about these matters can be found in our other
Securities and Exchange Commission filings.  In addition, there can be no
assurances regarding: whether HLTH and WebMD will be able to complete the
Merger Transaction or as to the timing of such transaction; or whether HLTH
will be able to complete the Potential Sale Transaction or as to the timing or
terms of such transaction. Except as required by applicable law or regulation,
we do not undertake any obligation to update our forward-looking statements to
reflect future events or circumstances.
    This press release, and the accompanying tables, include both financial
measures in accordance with accounting principles generally accepted in the
United States of America, or GAAP, as well as certain non-GAAP financial
measures. The tables attached to this press release include reconciliations of
these non-GAAP financial measures to GAAP financial measures. In addition, an
"Explanation of Non-GAAP Financial Measures" is attached to this press release
as Annex A.

    WebMD(R), WebMD Health(R) and POREX(R) are trademarks of HLTH Corporation
or its subsidiaries.



                               -Tables Follow-



                               HLTH CORPORATION
                    CONSOLIDATED STATEMENTS OF OPERATIONS
               (In thousands, except per share data, unaudited)


                                       Three Months Ended   Six Months Ended
                                            June 30,            June 30,
                                         2008      2007      2008      2007

    Revenue                             $89,136   $77,197  $170,818  $149,078

    Costs and expenses:
      Cost of operations                 32,763    28,997    64,333    57,615
      Sales and marketing                25,460    21,929    51,290    44,799
      General and administrative         23,181    26,950    44,325    55,393
      Depreciation and amortization       7,315     7,239    14,203    13,564
      Interest income                     8,062    10,100    19,998    19,774
      Interest expense                    4,628     4,616     9,235     9,325
      Gain on sale of EBS Master LLC        -         -     538,024       -
      Impairment of auction rate
       securities                           -         -      60,108       -
      Other (expense) income, net          (666)    1,396    (4,810)    4,278
    Income (loss) from continuing
     operations before income tax
     provision                            3,185    (1,038)  480,536    (7,566)
      Income tax provision                1,330     1,658    26,944     1,427
      Minority interest in WHC income
       (loss)                             1,071       843    (2,774)      958
      Equity in earnings of EBS Master
       LLC                                  -       7,575     4,007    14,674
    Income from continuing operations       784     4,036   460,373     4,723
      Loss from discontinued
       operations, net of tax            (3,651)  (49,499)      (82)  (44,484)
    Net (loss) income                   $(2,867) $(45,463) $460,291  $(39,761)

    Basic (loss) income per common
     share:
      Income from continuing operations   $0.00     $0.02     $2.52     $0.03
      Loss from discontinued operations   (0.02)    (0.27)    (0.00)    (0.25)
    Net (loss) income                    $(0.02)   $(0.25)    $2.52    $(0.22)

    Diluted (loss) income per common
     share:
      Income from continuing operations   $0.00     $0.02     $2.04     $0.02
      Loss from discontinued operations   (0.02)    (0.26)    (0.00)    (0.23)
    Net (loss) income                    $(0.02)   $(0.24)    $2.04    $(0.21)

    Weighted-average shares outstanding
     used in computing (loss) income
     per common share:
          Basic                         182,622   180,219   182,399   178,115
          Diluted                       186,243   191,032   228,209   188,693



                               HLTH CORPORATION
                       CONSOLIDATED SEGMENT INFORMATION
               (In thousands, except per share data, unaudited)

                                       Three Months Ended   Six Months Ended
                                            June 30,            June 30,
                                         2008      2007      2008      2007
    Revenue
      WebMD Online Services:
        Advertising and sponsorship     $62,383   $52,436  $118,448   $99,857
        Licensing                        21,866    19,799    43,789    39,914
        Content syndication and other       345       653       762     1,537
      Total WebMD Online Services        84,594    72,888   162,999   141,308
      WebMD Publishing and Other
       Services                           4,582     4,382     7,859     7,906
      Inter-segment eliminations            (40)      (73)      (40)     (136)
                                        $89,136   $77,197  $170,818  $149,078
    Earnings before interest, taxes,
     non-cash and other items
     ("Adjusted EBITDA") (a)
      WebMD Online Services             $18,800   $14,042   $35,331   $27,034
      WebMD Publishing and Other
       Services                           1,027       863       273       505
      Corporate                          (5,573)   (6,337)  (10,632)  (13,063)
                                        $14,254    $8,568   $24,972   $14,476

      Adjusted EBITDA per diluted
       common share (b)                   $0.08     $0.04     $0.11     $0.08

    Interest, taxes, non-cash and other
     items (c)
      Interest income                    $8,062   $10,100   $19,998   $19,774
      Interest expense                   (4,628)   (4,616)   (9,235)   (9,325)
      Income tax provision               (1,330)   (1,658)  (26,944)   (1,427)
      Depreciation and amortization      (7,315)   (7,239)  (14,203)  (13,564)
      Non-cash stock-based compensation  (6,471)   (7,779)  (12,443)  (16,961)
      Non-cash advertising                  -         -      (1,558)   (2,320)
      Minority interest in WHC (income)
       loss                              (1,071)     (843)    2,774      (958)
      Equity in earnings of EBS Master
       LLC                                  -       7,575     4,007    14,674
      Gain on sale of EBS Master LLC        -         -     538,024       -
      Impairment of auction rate
       securities                           -         -     (60,108)      -
      Other (expense) income, net          (717)      (72)   (4,911)      354
    Income from continuing operations       784     4,036   460,373     4,723
      Loss from discontinued
       operations, net of tax            (3,651)  (49,499)      (82)  (44,484)
    Net (loss) income                   $(2,867) $(45,463) $460,291  $(39,761)

    Basic (loss) income per common
     share:
      Income from continuing operations   $0.00     $0.02     $2.52     $0.03
      Loss from discontinued operations   (0.02)    (0.27)    (0.00)    (0.25)
    Net (loss) income                    $(0.02)   $(0.25)    $2.52    $(0.22)

    Diluted (loss) income per common
     share:
      Income from continuing operations   $0.00     $0.02     $2.04     $0.02
      Loss from discontinued operations   (0.02)    (0.26)    (0.00)    (0.23)
    Net (loss) income                    $(0.02)   $(0.24)    $2.04    $(0.21)

    Weighted-average shares outstanding
     used in computing (loss) income
     per common share:
      Basic                             182,622   180,219   182,399   178,115
      Diluted                           186,243   191,032   228,209   188,693


    (a) See Annex A-Explanation of Non-GAAP Financial Measures.
    (b) Adjusted EBITDA per diluted common share is based on the weighted-
        average shares outstanding used in computing diluted (loss) income per
        common share.
    (c) Reconciliation of Adjusted EBITDA to income from continuing
        operations.



                               HLTH CORPORATION
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                          (In thousands, unaudited)

                                             June 30, 2008   December 31, 2007
    Assets
    Cash and cash equivalents                   $1,123,899           $536,879
    Short-term investments                         304,325            290,858
    Accounts receivable, net                        68,865             86,081
    Due from EBS Master LLC                             69              1,224
    Prepaid expenses and other current assets       24,331             71,090
    Assets of discontinued operations              268,046            262,964
          Total current assets                   1,789,535          1,249,096

    Marketable equity securities                     2,543              2,383
    Property and equipment, net                     48,491             49,554
    Goodwill                                       214,475            217,323
    Intangible assets, net                          31,323             36,314
    Investment in EBS Master LLC                       -               25,261
    Other assets                                    62,330             71,466
    Total Assets                                $2,148,697         $1,651,397

    Liabilities and Stockholders' Equity
    Accrued expenses                               $44,807            $49,598
    Deferred revenue                                87,401             76,401
    Liabilities of discontinued operations         124,788            123,131
          Total current liabilities                256,996            249,130

    Convertible notes                              650,000            650,000
    Other long-term liabilities                     21,332             21,137

    Minority interest in WHC                       135,416            131,353

    Stockholders' equity                         1,084,953            599,777

    Total Liabilities and Stockholders' Equity  $2,148,697         $1,651,397



                               HLTH CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                          (In thousands, unaudited)


                                                        Six Months Ended
                                                            June 30,
                                                     2008              2007
    Cash flows from operating activities:
    Net income (loss)                              $460,291         $(39,761)
    Adjustments to reconcile net income (loss)
     to net cash provided by operating activities:
        Loss from discontinued
         operations, net of tax                          82           44,484
        Depreciation and amortization                14,203           13,564
        Minority interest in WHC (income) loss       (2,774)             958
        Equity in earnings of EBS Master LLC         (4,007)         (14,674)
        Amortization of debt issuance costs           1,490            1,447
        Non-cash advertising                          1,558            2,320
        Non-cash stock-based compensation            12,443           16,961
        Deferred income taxes                         5,556            1,041
        Gain on sale of EBS Master LLC and 2006
         EBS Sale                                  (538,024)            (399)
        Impairment of auction rate securities        60,108              -
        Changes in operating assets and
         liabilities:
          Accounts receivable                        17,216            7,976
          Prepaid expenses and other, net            21,090            1,128
          Accrued expenses and other long-term
           liabilities                               (3,695)         (44,070)
          Deferred revenue                           11,000           10,576
            Net cash provided by continuing
             operations                              56,537            1,551
            Net cash (used in) provided by
             discontinued operations                   (343)          17,429
            Net cash provided by operating
             activities                              56,194           18,980

    Cash flows from investing activities:
      Proceeds from maturities and sales
       of available-for-sale securities             106,586          194,096
      Purchases of available-for-sale securities   (177,150)        (388,942)
      Purchases of property and equipment            (6,985)         (10,217)
      Proceeds related to the sales of
       EBS, EPS and ACS/ACP, net of expenses        598,935            2,898
      Decreases in net advances to EBS Master LLC     1,155           19,730
      Other                                             148              -
            Net cash provided by (used in)
             continuing operations                  522,689         (182,435)
            Net cash used in discontinued
             operations                              (3,144)          (2,341)
            Net cash provided by (used in)
             investing activities                   519,545         (184,776)

    Cash flows from financing activities:
      Proceeds from issuance of HLTH and
       WHC common stock                               9,644          103,263
      Purchases of treasury stock under
       repurchase program                               -            (42,906)
      Other                                             (80)             457
            Net cash provided by continuing
             operations                               9,564           60,814
            Net cash used in discontinued
             operations                                 (76)            (101)
            Net cash provided by financing
             activities                               9,488           60,713
    Effect of exchange rates on cash                  1,793              361
    Net increase (decrease) in cash and
     cash equivalents                               587,020         (104,722)
    Cash and cash equivalents at
     beginning of period                            536,879          614,691
    Cash and cash equivalents at end of period   $1,123,899         $509,969



                                   ANNEX A

                  Explanation of Non-GAAP Financial Measures

    The accompanying HLTH Corporation press release and financial tables
include both financial measures in accordance with U.S. generally accepted
accounting principles, or GAAP, as well as non-GAAP financial measures. The
non-GAAP financial measures represent earnings before interest, taxes, non-
cash and other items (which we refer to as "Adjusted EBITDA") and related per
share amounts.  Adjusted EBITDA should be viewed as supplemental to, and not
as an alternative for, "(loss) income from continuing operations" calculated
in accordance with GAAP.  The tables attached to the accompanying press
release include reconciliations of non-GAAP financial measures to GAAP
financial measures.
    Adjusted EBITDA is used by HLTH's management as an additional measure of
HLTH's overall performance and its reporting segments' performance for
purposes of business decision-making, including developing budgets, managing
expenditures, and evaluating potential acquisitions or divestitures.  Period-
to-period comparisons of Adjusted EBITDA help HLTH's management identify
additional trends in HLTH's and its reporting segments' financial results that
may not be shown solely by period-to-period comparisons of (loss) income from
continuing operations or net (loss) income.  In addition, HLTH uses Adjusted
EBITDA in the incentive compensation programs applicable to many of its
employees in order to evaluate HLTH's performance. HLTH management recognizes
that Adjusted EBITDA has inherent limitations because of the excluded items,
particularly those items that are recurring in nature.  In order to compensate
for those limitations, management also reviews the specific items that are
excluded from Adjusted EBITDA, but included in income from continuing
operations or net (loss) income, as well as trends in those items.  The
amounts of those items are set forth, for the applicable periods, in the
reconciliations of Adjusted EBITDA to (loss) income from continuing operations
or to net (loss) income that accompany our press releases containing non-GAAP
financial measures, including the reconciliations contained in the tables
attached to the accompanying press release.
    HLTH believes that the presentation of Adjusted EBITDA is useful to
investors in their analysis of HLTH's results for reasons similar to the
reasons why HLTH's management finds it useful and because it helps facilitate
investor understanding of decisions made by HLTH's management in light of the
performance metrics used in making those decisions.  In addition, as more
fully described below, HLTH believes that providing Adjusted EBITDA, together
with a reconciliation of Adjusted EBITDA to (loss) income from continuing
operations or to net (loss) income, helps investors make comparisons between
HLTH and other companies that may have different capital structures, different
effective income tax rates and tax attributes, different capitalized asset
values and/or different forms of employee compensation.  However, Adjusted
EBITDA is intended to provide a supplemental way of comparing HLTH with other
public companies and is not intended as a substitute for comparisons based on
"income from continuing operations" or "net (loss) income" calculated in
accordance with GAAP.  In making any comparisons to other companies, investors
need to be aware that companies use different non-GAAP measures to evaluate
their financial performance.  Investors should pay close attention to the
specific definition being used and to the reconciliation between such measures
and the corresponding GAAP measures provided by each company under applicable
SEC rules.
    The following is an explanation of the items excluded by HLTH from
Adjusted EBITDA but included in income from continuing operations:
    -- Depreciation and Amortization.  Depreciation and amortization expense
is a non-cash expense relating to capital expenditures and intangible assets
arising from acquisitions that are expensed on a straight-line basis over the
estimated useful life of the related assets. HLTH excludes depreciation and
amortization expense from Adjusted EBITDA because it believes (i) the amount
of such expenses in any specific period may not directly correlate to the
underlying performance of HLTH's business operations and (ii) such expenses
can vary significantly between periods as a result of new acquisitions and
full amortization of previously acquired tangible and intangible assets.
Accordingly, HLTH believes this exclusion assists management and investors in
making period-to-period comparisons of operating performance.  Investors
should note that the use of tangible and intangible assets contributed to
revenue in the periods presented and will contribute to future revenue
generation and should also note that such expense will recur in future
periods.
    -- Stock-Based Compensation Expense.  Stock-based compensation expense is
a non-cash expense arising from the grant of stock-based awards to employees.
HLTH believes that excluding the effect of stock-based compensation from
Adjusted EBITDA assists management and investors in making period-to-period
comparisons in its operating performance because it believes (i) the amount of
such expenses in any specific period may not directly correlate to the
underlying performance of HLTH's business operations and (ii) such expenses
can vary significantly between periods as a result of the timing of grants of
new stock-based awards, including grants in connection with acquisitions.
Additionally, HLTH believes that excluding stock-based compensation from
Adjusted EBITDA assists management and investors in making meaningful
comparisons between HLTH's operating performance and the operating performance
of other companies that may use different forms of employee compensation or
different valuation methodologies for their stock-based compensation.
Investors should note that stock-based compensation is a key incentive offered
to employees whose efforts contributed to the operating results in the periods
presented and are expected to contribute to operating results in future
periods.  Investors should also note that such expenses will recur in the
future.
    -- Non-Cash Advertising Expense.  This expense relates to the usage of
non-cash advertising obtained from News Corporation ("Newscorp") in exchange
for equity securities issued by HLTH in 2000. The advertising is available
only on various Newscorp properties, primarily its television network and
cable channels without any cash cost to HLTH. The amount of advertising that
can be used in any year is subject to annual contractual limitation and
expires in 2010. HLTH does not incur any other cash expenses related to airing
of television advertising. HLTH excludes this expense from Adjusted EBITDA (i)
because it is a non-cash expense, (ii) because it is incremental to other non-
television cash advertising expense that HLTH otherwise incurs, (iii) because
HLTH has not and believes it will not incur cash expenses relating to
television advertising in the future and (iv) to assist management and
investors in comparing its operating results over multiple periods.  Investors
should note that it is likely that HLTH derives some benefit from such
advertising and that such expenses will recur in the future.
    -- Interest Income and Expense.  Interest income is associated with the
level of marketable debt securities and other interest bearing accounts in
which HLTH invests, as well as with interest expenses arising from the capital
structure of HLTH.  Interest income and expense varies over time due to a
variety of financing transactions and due to acquisitions and divestitures
that HLTH has entered into or may enter into in the future.  HLTH has, in the
past several years, issued convertible debentures and preferred stock,
repurchased shares in cash tender offers and through other repurchase
transactions, conducted an initial public offering of equity in its WebMD
subsidiary and completed the divestiture of certain businesses. HLTH excludes
interest income and interest expense from Adjusted EBITDA (i) because these
items are not directly attributable to the performance of HLTH's business
operations and, accordingly, their exclusion assists management and investors
in making period-to-period comparisons of operating performance and (ii) to
assist management and investors in making comparisons to companies with
different capital structures. Investors should note that interest income and
expense will recur in future periods.
    -- Income Tax Provision.  HLTH had a net operating loss (NOL) carryforward
of approximately $1.3 billion as of the year ended December 31, 2007.  HLTH
maintained a full valuation allowance on these NOL carryforwards until the
fourth quarter of 2007, at which time a portion of the valuation allowance was
reversed after consideration of the relevant factors.  The related valuation
allowances are either reversed through the income statement, additional paid-
in capital, or reversed to goodwill, to the extent those tax benefits were
acquired through business combinations.  The timing of such reversals has not
been consistent and as a result, HLTH's income tax expense can fluctuate
significantly from period to period in a manner not directly related to HLTH's
operating performance.  HLTH excludes the income tax provision from Adjusted
EBITDA (i) because it believes that the income tax provision is not directly
attributable to the underlying performance of HLTH's business operations and,
accordingly, its exclusion assists management and investors in making period-
to-period comparisons of operating performance and (ii) to assist management
and investors in making comparisons to companies with different tax
attributes.  Investors should note that income tax provision will recur in
future periods.
    -- Minority Interest in WHC.  This represents the minority stockholders'
proportionate share of net income or loss of HLTH's majority-owned WebMD
Health Corp. subsidiary (which we refer to as WHC).  The size of this Minority
Interest is related to HLTH's percentage ownership of WHC.  Changes in that
percentage ownership may result from changes in WHC's capital structure,
including as a result of sales of WHC equity securities by WHC or HLTH or as a
result of exercise of WHC employee stock options.  HLTH excludes Minority
Interest from Adjusted EBITDA (i) because it believes that the size of the
Minority Interest can vary for reasons not attributable to the underlying
performance of HLTH's business operations and, accordingly, its exclusion
assists management and investors in making period-to-period comparisons of
operating performance and (ii) to assist management and investors in making
comparisons to companies with different capital structures. Investors should
note that Minority Interest in WHC will recur in future periods.
    -- Other Items.  HLTH engages in other activities and transactions that
can impact HLTH's overall income from continuing operations.  These other
items included, but were not limited to, (i) legal expenses relating to the
on-going Department of Justice investigation, (ii) equity in earnings of EBS
Master LLC, which represents 48% of EBS's income through February 8, 2008,
(iii) working capital adjustment from the sale of 52% of the Emdeon Business
Services segment on November 16, 2006, (iv) a reduction of certain sales and
use tax contingencies resulting from the expiration of certain applicable
statutes of limitations, (v) advisory expenses relating to the evaluation, in
2008 and 2007, by HLTH's Board of Directors of strategic alternatives for
HLTH, (vi) gain on sale from the sale of the remaining 48% ownership interest
in EBS Master LLC and (vii) loss on the impairment of auction rate securities.
HLTH excludes these other items from Adjusted EBITDA because it believes these
activities or transactions are not directly attributable to the performance of
HLTH's business operations and, accordingly, their exclusion assists
management and investors in making period-to-period comparisons of operating
performance.  Investors should note that some of these other items may recur
in future periods.
SOURCE  HLTH Corporation

Investors, Risa Fisher, rfisher@hlth.com, +1-201-414-2002, or Media, Jennifer
Newman, jnewman@hlth.com, +1-212-624-3912, both of HLTH Corporation
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.