The Providence Service Corp. (PRSC, Financial) filed Quarterly Report for the period ended 2010-03-31.
The Providence Service Corp. has a market cap of $212.4 million; its shares were traded at around $16.45 with a P/E ratio of 10 and P/S ratio of 0.3. PRSC is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Stock-based compensation. Stock-based compensation expense of approximately $108,000 for the three months ended March 31, 2010 represents the amortization of the fair value of stock options awarded to employees of our NET Services operating segment during 2009 under our 2006 Plan. Of the total stock-based compensation expense of approximately $800 and $119,000 for the three months ended March 31, 2009 and 2010, respectively, approximately $0 and $108,000 was expensed as part of cost of non-emergency transportation services and the remainder was expensed as client service expense and general and administrative expense.
Interest expense. Our current and long-term debt obligations have decreased to approximately $195.6 million at March 31, 2010 from $234.2 million at March 31, 2009, which was a significant factor contributing to the decrease in our interest expense for the three months ended March 31, 2010 of approximately $940,000 as compared to the three months ended March 31, 2009. In addition, interest expense for the three months ended March 31, 2009 included approximately $127,000 related to the de-designation of our interest rate swap during the first quarter of 2009 and approximately $348,000 of accelerated amortization of deferred financing fees due to the amendment of our credit and guarantee agreement (which were not included in interest expense for the three months ended March 31, 2010).
Sources of cash for the three months ended March 31, 2010 were primarily from operations. Our balance of cash and cash equivalents was approximately $55.5 million at March 31, 2010, up from $51.2 million at December 31, 2009. Approximately $4.9 million of cash was held by WCG International Ltd. (our foreign wholly-owned subsidiary), or WCG, at March 31, 2010 and was not freely transferable without unfavorable tax consequences. We had restricted cash of approximately $14.1 million and $14.4 million at December 31, 2009 and March 31, 2010, respectively, related to contractual obligations and activities of our captive insurance subsidiaries and correctional services business. At December 31, 2009 and March 31, 2010, our total debt was approximately $204.2 million and $195.6 million, respectively.
Operating activities. Net income of approximately $9.1 million plus non-cash depreciation, amortization, amortization of deferred financing costs, provision for doubtful accounts, stock-based compensation, deferred income taxes and other items of approximately $5.1 million was partially offset by the growth of our billed and unbilled accounts receivable of approximately $9.8 million for the three months ended March 31, 2010. The growth of our billed and unbilled accounts receivable during the three months ended March 31, 2010 was mostly due to revenue growth and one payer who has deferred payment of approximately $6.2 million which we expect to collect in our second quarter.
For the three months ended March 31, 2010, net cash flow from operating activities totaled approximately $15.4 million. Decreases in management fees receivable and other receivables resulted in an increase in cash provided by operations of approximately $418,000. Prepaid expenses and other assets decreased, which resulted in an increase in cash flow from operations of approximately $385,000. Restricted cash related to the collection activities of the correctional services business resulted in additional cash used in operating activities of approximately $305,000. Changes in accounts payable, accrued expenses and accrued transportation costs resulted in cash provided by operating activities of approximately $11.7 million, while decreases in deferred revenue and other long term liabilities resulted in cash used in operating activities of approximately $422,000. Reinsurance liability reserves related to our reinsurance programs decreased resulting in cash used in operating activities of approximately $892,000.
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The Providence Service Corp. has a market cap of $212.4 million; its shares were traded at around $16.45 with a P/E ratio of 10 and P/S ratio of 0.3. PRSC is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Stock-based compensation. Stock-based compensation of approximately $930 for the three months ended March 31, 2010 represents the amortization of the fair value of stock options awarded to an executive officer in January 2009 under our 2006 Long-Term Incentive Plan, or 2006 Plan. Of the total stock-based compensation expense of approximately $800 and $119,000 for the three months ended March 31, 2009 and 2010, respectively, approximately $800 and $900 was expensed as part of client service expense and the remainder was expensed as cost of non-emergency transportation services and general and administrative expense.Stock-based compensation. Stock-based compensation expense of approximately $108,000 for the three months ended March 31, 2010 represents the amortization of the fair value of stock options awarded to employees of our NET Services operating segment during 2009 under our 2006 Plan. Of the total stock-based compensation expense of approximately $800 and $119,000 for the three months ended March 31, 2009 and 2010, respectively, approximately $0 and $108,000 was expensed as part of cost of non-emergency transportation services and the remainder was expensed as client service expense and general and administrative expense.
Interest expense. Our current and long-term debt obligations have decreased to approximately $195.6 million at March 31, 2010 from $234.2 million at March 31, 2009, which was a significant factor contributing to the decrease in our interest expense for the three months ended March 31, 2010 of approximately $940,000 as compared to the three months ended March 31, 2009. In addition, interest expense for the three months ended March 31, 2009 included approximately $127,000 related to the de-designation of our interest rate swap during the first quarter of 2009 and approximately $348,000 of accelerated amortization of deferred financing fees due to the amendment of our credit and guarantee agreement (which were not included in interest expense for the three months ended March 31, 2010).
Sources of cash for the three months ended March 31, 2010 were primarily from operations. Our balance of cash and cash equivalents was approximately $55.5 million at March 31, 2010, up from $51.2 million at December 31, 2009. Approximately $4.9 million of cash was held by WCG International Ltd. (our foreign wholly-owned subsidiary), or WCG, at March 31, 2010 and was not freely transferable without unfavorable tax consequences. We had restricted cash of approximately $14.1 million and $14.4 million at December 31, 2009 and March 31, 2010, respectively, related to contractual obligations and activities of our captive insurance subsidiaries and correctional services business. At December 31, 2009 and March 31, 2010, our total debt was approximately $204.2 million and $195.6 million, respectively.
Operating activities. Net income of approximately $9.1 million plus non-cash depreciation, amortization, amortization of deferred financing costs, provision for doubtful accounts, stock-based compensation, deferred income taxes and other items of approximately $5.1 million was partially offset by the growth of our billed and unbilled accounts receivable of approximately $9.8 million for the three months ended March 31, 2010. The growth of our billed and unbilled accounts receivable during the three months ended March 31, 2010 was mostly due to revenue growth and one payer who has deferred payment of approximately $6.2 million which we expect to collect in our second quarter.
For the three months ended March 31, 2010, net cash flow from operating activities totaled approximately $15.4 million. Decreases in management fees receivable and other receivables resulted in an increase in cash provided by operations of approximately $418,000. Prepaid expenses and other assets decreased, which resulted in an increase in cash flow from operations of approximately $385,000. Restricted cash related to the collection activities of the correctional services business resulted in additional cash used in operating activities of approximately $305,000. Changes in accounts payable, accrued expenses and accrued transportation costs resulted in cash provided by operating activities of approximately $11.7 million, while decreases in deferred revenue and other long term liabilities resulted in cash used in operating activities of approximately $422,000. Reinsurance liability reserves related to our reinsurance programs decreased resulting in cash used in operating activities of approximately $892,000.
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