Rural/Metro Corp. F2Q08 (Qtr End 12/31/07) Earnings Call Transcript

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2008-02-11 11:04:07.0

Tags: Rural/Metro Corp.

Question-and-Answer Session

Operator

Thank you, sir. Today's question-and-answer session will be conducted electronically. (Operator Instructions). We will go first to Lawrence Weiss with Citigroup.

Lawrence Weiss - Citigroup

Hi, guys. Just two questions really. One, on the guidance, the $13.9 million that put out today was included about the $1.9 million gain on the sale of accounts receivable. The $50 million to $55 million, is that going to include a $1.9 million and how much of the $50 million to $55 million are you going to -- within that $50 million to $55 million, how much of these gains on sales of a previously written-off AR are going to be included into that number?

Kristy Ponczak

Hi Lawrence.

Lawrence Weiss - Citigroup

How are you?

Kristy Ponczak

I am good, thank you. To talk a little bit about the guidance, the sale of AR would be included in that number and, but in terms of sort of looking at EBITDA, what I might walk you through is that our EBITDA of $13.9 million has a couple of things in it that you might characterize as that we would not expect to repeat. In the quarter we have $1.9 million reserved in there within the contractual allowance line in revenue that relates to an alleged overpayment related to Tennessee, Medicare that we reserved for.

There is also approximately $1 million as Jack outlined of additional professional fees as described in addition to the AR sale. So, if you adjust those numbers that $13.9 million comes closer to sort of a $15.2 million for the quarter. But, again, in that number is include -- in terms of, in the $55 million, the AR sale would be in there.

Lawrence Weiss - Citigroup

Okay. Because you consider that to be more of an operating thing or because why would you actually include that into EBITDA, if it's more just one-time in nature?

Kristy Ponczak

Well, when I get to $15.2 million -- sorry, but I just walked you through, I may then backing that out, but from a GAAP perspective it is included in the calculation of EBITDA.

Lawrence Weiss - Citigroup

Okay. Fine. And the second question is Jack, you kind of -- or going through the percentage of revenue that were considered to be uncompensated care and there was meaningful improvements from 15.2 to 14.5, what drove that? There was a big jump between this last quarter and the second quarter, what drove with this specific quarter?

 

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