Earnings Labs

CorVel Corporation (CRVL)

Q2 2016 Earnings Call· Tue, Nov 3, 2015

$57.69

-0.74%

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Transcript

Operator

Operator

Thank you for standing by. Welcome to the CorVel Corporation quarterly earnings release conference call. During the course of this conference call, CorVel Corporation may make projections or other forward-looking statements regarding future events or the future financial performances of the company. CorVel wishes to caution you that these statements are only predictions, and the actual events or results may differ materially. CorVel refers you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the company's last Form 10-K and 10-Q files for the most recent fiscal year and quarter. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Mr. Gordon Clemons. Sir, please go ahead.

V. Clemons

Analyst

Thank you for joining us to review CorVel's September quarter. Revenues for the September quarter were $124.5 million, up just slightly versus the revenue for the September 2014 quarter. Earnings per share for the quarter ended September 30, 2015, were $0.41 a share, up 10% over the same quarter of 2014. In the quarter, our Enterprise Comp TPA product continued to add accounts and to implement our next-generation claims management platform. The trend toward integrated programs and workers' compensation favors CorVel's proprietary service continuum. As I indicated in the June quarter call, we're also steadily transitioning our operations to incorporate our workflow management processes. We made progress on that in the quarter. Turning now to our markets. The market for our workers' compensation services remains active and evolving. As the labor market improves, workers' compensation expenses has become more problematic, which in turn slowly improves our market. The slow recovery from the great recession created an understandably soft workers' compensation market. The workers' comp market lags the economy but should gradually improve, as has the economy. Private equity ownership in our industry has largely completed the phase where such firms can resell their properties to one another and would seem to be entering the distribution phase of their involvement. As we've discussed on previous calls, the leveraged financings for such firms create incentives to cut costs and to look for short-term sales gains. CorVel had a lot of customer renewals over the last 12 months. We retained a high percentage of them, and yet we did lose 1 public entity, which impacted our revenue in the September quarter. The private equity-owned firms compete on price as they look for short-term gains, which can support a sale of their leveraged positions. Our investments in technology are creating a steadily strengthening business…

Operator

Operator

[Operator Instructions] At this time, we have no questions in the audio portion of this conference. I would now like to turn conference back over to management for closing remarks.

V. Clemons

Analyst

Thank you, Tim, and I'd like to thank everyone for joining us for the quarterly earnings call. We will look forward to speaking to you again after the current quarter. Thank you.

Operator

Operator

This concludes today's teleconference. You may disconnect your lines at this time. We thank you for your participation, and have a wonderful rest of your day.