So regardless of the new M&A type ventures -lets looks at core business. Current HBS customers are leaving them at an alarming rate.- Mayo and multiple others. There same based transport volume is declining on the CBS side. They currently dont fly at night unless their programs are night vision goggle certified after the Rockford Il crash. They have increased their CBS bill to almost $30,000. How long do you think the run can last? Decreasing volumes, insurances now refusing to pay the unbelievable rates, and old stand by customers leaving. After making significant $ on this one. Im done and goingthe other way. SHORT.
We’ve obviously seen an abrupt change in our same-based transport flight volume trends, from August 2012 through January 2013 our same-based transport after adjusting for weather cancelation variations increased 4%, from February through April 2013 after adjusting for weather our same-based transport have declined 9%, a 13% shift in just a few short months which suggest that weather also had an affect on call volume, as well as on canceled flights.
Our hospital-based programs are experiencing similar decline as well, suggesting that pricing variation among programs is not a primary factor in the decline in demand. While we have isolated a small percentage of the decline to increase competition in a couple of markets we have addressed this partially through base consolidation.
The decrease in net revenue per transport in the first quarter resulted from a steep decrease in percentage of privately-insured patients transported as we had previously announced.
We received notice that two of our hospital customers will not be renewing with us, one effective May 31st involving just one single base and one effective near the end of the year involving three bases.
so ralph, what is your opinion at this point. is this a buy or the beginning of a period of problems again. the stock was savaged so far and even management seems clueless as to what the problems are.
you flat out called this. amazingly prescient commentary, beyond what the analysts indicated, beyond the street, beyond the company guidance. what a poor, poor performance by AIRM management here. they are not even sure what happened to them! well called Ralph.
Mayo is getting their own part 135. just like several of the other air methods HBS customers- they are going out on their own. From the mayo web posting:
"Mayo Clinic begins their search for a Chief Pilot and Director of Operations to pursue an air carrier certificate for part 135 operations at the Mayo One Helicopter program"
I wont argue with the institutional support. BUT- you cant argue with no increase in same base transport. And do your research they still have 30% of programs non aided with goggles. So couple the decrease in volume from normal base transports and then add the goggle issues and you are going to have an ugly next quarter- it wont show in this one.
I put two of them above- If you do your research you can find it. I am in the industry- times are a changing- the customers do not like being run by the 600 lb gorilla and are therefore doing what Mayo and the others are doing and going out on their own. Research the lawsuit with BC/BS in florida- these insurance companies are not going to pay $30,000 anymore to haul a patient and now you have to prove why you needed the aircraft over critical care ground. This is the biggest smoke and mirror show I have seen in awhile. It wont last- I guarentee it. we are seeing it in the industry. Another 2-3 quarters and you will see what I am talking about.