28 Dec Merge Healthcare continues downward trend; SEC to probe finances
Milwaukee, Wis. – The financial bleeding continues for Merge Technologies, which reported a $10.7 million net loss, or $0.32 per share, for the second quarter of 2007, and now faces a Securities and Exchange Commission investigation into its finances.
The medical software company’s second quarter performance compares to the net loss of $211.0 million, or $6.27 per share, in the second quarter of 2006, and a net loss of $9.7 million, or $0.29 per share, in the first quarter of 2007. During the second quarter of 2006, Merge recognized a goodwill impairment charge of $214.1 million, or $6.36 per share.
The financially troubled company is still trying to recover from financial reporting errors that resulted in the resignations of several key executives in 2006. In conjunction with the second quarter numbers, Merge announced that it has filed with the SEC its restated financial statements for the 2004, 2005 and 2006, and restated financial statements for the three months ended March 31, 2007 and 2006.
It is the latest in a series of restated quarterly and annual financial reports dating back to 2003, prompting the SEC to launch a formal investigation into its accounting.
Merge also has faced delisting from the NASDAQ Global Market.
For the second quarter of, 2007, revenue totaled $14.0 million, compared to $31.4 million in the second quarter of 2006 and the $15.9 million reported in the first quarter of 2007. That represents decreases of 55 percent and 12 percent, respectively.
For the first six months of 2007, revenue totaled $29.9 million, compared to $47.6 million for the same period of 2006, a decrease of 37 percent.
• Merge to introduce new “teleradiology” tool
• NASDAQ panel grants Merge another reprieve
• Merge Healthcare to restate annual financials
• Merge subsidiary shows company’s healthcare IT products still have some market traction