UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of report (Date of earliest event reported): November 12, 2015


Hooper Holmes, Inc.
(Exact name of registrant as specified in charter)


New York

1-9972

22-1659359

(State or other jurisdiction

of incorporation)

(Commission File Number)

(IRS Employer Identification No.)

560 N. Rogers Road, Olathe, KS 66062
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code  (913) 764-1045

Not Applicable
(Former names or former address, if changed since last report)

          Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



Item 2.02         Results of Operations and Financial Condition

On November 12, 2015, Hooper Holmes, Inc. (the “Company”) issued a press release announcing its preliminary operating results and financial condition for the quarter ended September 30, 2015.  A copy of the press release is attached hereto as Exhibit 99.1, which is incorporated herein by reference.  The presentation discussed during the third quarter investor call on November 12, 2015 is attached as Exhibit 99.2, which is also incorporated herein by reference.

The information furnished in this section of the Current Report on Form 8-K and Exhibits attached hereto shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01         Financial Statements and Exhibits

                         (d) Exhibits

                          99.1 Press Release, dated November 12, 2015.

                          99.2 Presentation used during the third quarter investor conference call on November 12, 2015.



SIGNATURES

          Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Hooper Holmes, Inc.

 

Date:

November 12, 2015

 

 

By: /s/ Steven R. Balthazor

Steven R. Balthazor

Chief Financial Officer



Exhibit 99.1

Hooper Holmes Announces Third Quarter 2015 Financial Results

OLATHE, Kan.--(BUSINESS WIRE)--November 12, 2015--Hooper Holmes (NYSE MKT:HH) today announced financial results for the quarter ended September 30, 2015, reporting an 18% increase in revenues, a 15% improvement in gross profit and a significantly reduced net loss compared to the quarter ended September 30, 2014. The Company also filed an initial S-1 registration statement with the Securities and Exchange Commission to raise $4.0 million in capital through a rights offering to existing shareholders.

Consolidated revenues totaled $9.3 million for the third quarter of 2015, representing an increase of 18% from $7.9 million in the third quarter of 2014, due to additional revenue from the acquisition of Accountable Health Solutions, Inc. (AHS) and increased biometric screenings. The Company completed 139,000 biometric screenings during the third quarter of 2015, representing an increase of 17% from 119,000 biometric screenings completed in the third quarter of 2014. Gross profit totaled $2.1 million for the third quarter of 2015, representing an increase of 15% from $1.9 million in the third quarter of 2014, due to increased revenue and our expanded suite of health and wellness products and services. Margins were impacted by operational investments of $700 thousand during the third quarter 2015 for process improvements, oversight and staff training, which are expected to be leveraged as revenues increase.

Selling, general and administrative expense totaled $3.7 million for the third quarter of 2015 compared to $3.5 million in the third quarter of 2014. Excluding the impact of one-time events, the Company recorded a net loss of $1.6 million, or $0.02 per share, for the third quarter of 2015, compared to a net loss of $4.5 million, or $0.06 per share, in the third quarter of 2014. As of September 30, 2015, cash and cash equivalents totaled $1.5 million, an increase of $0.3 million from the three month period ending June 30, 2015, with $3.4 million in borrowings outstanding under the Company's credit facility.

Henry Dubois, President and CEO of Hooper Holmes commented, "Our business momentum continues to build. Year to date, we have won new sales providing approximately $5.0 million of revenue in 2015 and an estimated $11.0 million in revenue in 2016. To support our operations, sales growth, and service our debt obligations associated with the AHS acquisition we plan to raise $4.0 million by offering existing shareholders the opportunity to purchase additional shares through a rights offering. Directors, executive officers, related parties and a key shareholder, as disclosed in our S-1, are fully engaged in this capital raise. I am pleased to report that we have more than $1 million in non-binding commitments from this group. We hope to launch this program in early December and close the transaction in the first quarter of 2016. The registration statement is available on our website, and with the SEC."


Conference Call

The Company will host a conference call today, Thursday, November 12, 2015, at 7:30 a.m. CT (8:30 a.m. ET) to discuss third quarter 2015 financial results. A slide presentation will accompany the conference call and is available on the Company’s website located at www.hooperholmes.com.

To participate in the conference call, please dial 888-438-5519, or internationally 719-785-1765, conference ID: 3408680, five to ten minutes before the call is scheduled to begin. A live webcast will be hosted on the Company's website located at www.hooperholmes.com. A replay of the conference call will be available from 10:30 a.m. CT (11:30 a.m. ET) on November 12, 2015 until 11:00 p.m. CT (midnight ET) on November 19, 2015, by dialing 877-870-5176, or internationally 858-384-5517. The access code for the replay is 3408680.

About Hooper Holmes

Hooper Holmes mobilizes a national network of health professionals to provide on-site health screenings, laboratory testing, risk assessment and sample collection services to wellness and disease management companies, employers and brokers, government organizations and academic institutions nationwide. Under the Accountable Health Solutions brand, the Company combines smart technology, healthcare and behavior change expertise to offer comprehensive health and wellness programs that improve health, increase efficiencies and reduce healthcare delivery costs.

This press release contains “forward-looking” statements, as such term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on the Company’s current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions. Among the important factors that could cause actual results to differ materially from those expressed in, or implied by, these forward-looking statements are our ability to realize the expected benefits from this acquisition and our strategic alliance with Clinical Reference Laboratory; our ability to successfully implement our business strategy and integrate Accountable Health Solutions’ business with ours; our ability to retain and grow our customer base; our ability to recognize operational efficiencies and reduce costs; uncertainty as to our working capital requirements over the next 12 to 24 months; our ability to maintain compliance with the financial covenant in our credit facility and the financing for this acquisition; and the rate of growth in the Health and Wellness market. Additional information about these and other factors that could affect the Company’s business is set forth in the Company’s annual report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission on March 31, 2015. The Company undertakes no obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release to reflect the occurrence of unanticipated events, except as required by law.


       
HOOPER HOLMES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands, except share and per share data)
 
 
 
Three months ended September 30,   Nine months ended September 30,
    2015   2014 2015   2014
 
Revenues $ 9,272 $ 7,875 $ 22,615 $ 21,852
Cost of operations   7,143     6,021     18,060     16,193  
Gross profit   2,129     1,854     4,555     5,659  
Selling, general and administrative expenses 3,740 3,541 10,212 12,007
Transaction costs 57 - 737 -
Gain on sale of real estate     (1,830 )     (1,830 )
Operating income (loss) from continuing operations (1,668 ) 143 (6,394 ) (4,518 )
Interest expense, net   (388 )   (61 )   (1,097 )   (156 )
Income (loss) from continuing operations before taxes (2,056 ) 82 (7,491 ) (4,674 )
Income tax expense   5     5     15     15  
Income (loss) from continuing operations   (2,061 )   77     (7,506 )   (4,689 )
 
Discontinued operations:
Gain on sale of subsidiaries, net of adjustments - 1,354 - 1,204
Loss from discontinued operations, net of tax   (57 )   (2,739 )   (82 )   (3,321 )
Loss from discontinued operations   (57 )   (1,385 )   (82 )   (2,117 )
Net loss $ (2,118 ) $ (1,308 ) $ (7,588 ) $ (6,806 )
 
Reconciliation of GAAP results to Non-GAAP results
Gain on sale of real estate/restructuring - (1,830 ) - (1,738 )
Gain on sale of lab services - (1,354 ) - (1,204 )
AHS transaction & integration costs 304 - 1,242 -
Close-out cost of 2013 Portamedic sale   168     -     168     -  
Adjusted (Non-GAAP) net loss $ (1,646 ) $ (4,492 ) $ (6,178 ) $ (9,748 )
 
Adjusted net loss for third quarter 2015 was $1.6 million, compared to $4.5 million of adjusted net loss in the third quarter of 2014. The above schedule is a description of adjustments made to net loss.
 
 
Income (loss) per share
Continuing operations:
Basic $ (0.03 ) $ 0.00 $ (0.10 ) $ (0.07 )
Diluted (0.03 ) 0.00 (0.10 ) (0.07 )
Discontinued operations:
Basic (0.00 ) (0.02 ) (0.00 ) (0.03 )
Diluted (0.00 ) (0.02 ) (0.00 ) (0.03 )
Net loss:
Basic (0.03 ) (0.02 ) (0.10 ) (0.10 )
Diluted   (0.03 )   (0.02 )   (0.10 )   (0.10 )
 
Weighted average number of shares:
Basic and diluted 77,789,792 70,866,603 75,391,420 70,623,068
 

Adjusted net loss is not a recognized term under GAAP. These non-GAAP financial measures should not be substituted for GAAP net earnings or GAAP diluted earnings per share, respectively, as measures of Hooper Holmes’ performance, but instead should be utilized as supplemental measures of financial performance in evaluating our business.


 
Hooper Holmes, Inc.
Consolidated Balance Sheets
(unaudited; in thousands)
     
September 30, 2015 December 31, 2014
ASSETS
Current assets:
Cash and cash equivalents $ 1,528 $ 5,201
Accounts receivable, net of allowance for doubtful accounts 7,546 3,178
Inventories 822 897
Other current assets   452     202  
Total current assets 10,348 9,478
 
Property, plant and equipment, net 3,183 3,054
Intangible assets 5,498 -
Goodwill 657 -
Other assets   662     607  
Total assets   20,348     13,139  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 4,688 2,508
Accrued expenses 5,276 4,083
Short-term debt   5,195     -  
Total current liabilities 15,159 6,591
 
Long-term debt, net of discount 65 -
Other long term liabilities 1,702 1,191
 
Commitments and contingencies
 
Stockholders' equity:
Common stock 3,119 2,835
Additional paid-in capital 156,116 150,747
Accumulated deficit   (155,742 )   (148,154 )
3,493 5,428
Less: Treasury stock at cost   (71 )   (71 )
Total stockholders' equity   3,422     5,357  
Total liabilities and stockholders' equity $ 20,348   $ 13,139  
 

CONTACT:
Hooper Holmes
Henry E. Dubois, 913-764-1045
President and CEO
or
Investors:
S.M. Berger & Company
Andrew Berger, 216-464-6400



Exhibit 99.2

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1 Hooper Holmes, Inc. November 12, 2015 Earnings Presentation Speakers: Henry Dubois, Chief Executive Officer Steven Balthazor, Chief Financial Officer



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2 Safe Harbor Statement 2 This presentation contains forward‐looking statements, as such term is defined in the Private Securities Litigation Reform Act of 1995, concerning the Company’s plans, objectives, goals, strategies, future events or performances, which are not statements of historical fact and can be identified by words such as: “expect,” “continue,” “should,” “may,” “will,” “project,” “anticipate,” “believe,” “plan,” “goal,” and similar references to future periods. The forward‐looking statements contained in this presentation reflect our current beliefs and expectations. Actual results or performance may differ materially from what is expressed in the forward looking statements. Among the important factors that could cause actual results to differ materially from those expressed in, or implied by, the forward‐looking statements contained in this presentation are our ability to realize the expected benefits from the acquisition of Accountable Health Solutions and our strategic alliance with Clinical Reference Laboratory; our ability to successfully implement our business strategy and integrate Accountable Health Solutions’ business with ours; our ability to retain and grow our customer base; our ability to recognize operational efficiencies and reduce costs; uncertainty as to our working capital requirements over the next 12 to 24 months; our ability to maintain compliance with the financial covenants contained in our credit facilities; the rate of growth in the Health and Wellness market and such other factors as discussed in Part I, Item 1A, Risk Factors, and Part II, Item 7, Management’s Discussion and Analysis of Financial Conditions and Results of Operations of our Annual Report on Form 10‐K for the year ended December 31, 2014. The Company undertakes no obligation to update or release any revisions to these forward‐looking statements to reflect events or circumstances, or to reflect the occurrence of unanticipated events, after the date of this presentation, except as required by law. This presentation contains information from third‐party sources, including data from studies conducted by others and market data and industry forecasts obtained from industry publications. Although the Company believes that such information is reliable, the Company has not independently verified any of this information and the Company does not guarantee the accuracy or completeness of this information. Any references to documents not included in the presentation itself are qualified by the full text and content of those documents. During our prepared comments or responses to your questions, we may offer incremental metrics to provide greater insight into the dynamics of our business or our quarterly results, such as references to EBITDA and other measures of financial performance. Please be advised that this additional detail may be one‐time in nature and we may or may not provide an update in the future. These and other financial measures may also have been prepared on a non‐GAAP basis. For some of these measures, a reconciliation schedule showing GAAP versus non‐GAAP results has been provided in our press release that was issued after the market closed today.



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3 Significant New Sales Results January 1st through September 30th we have grown the revenue base by adding… New Sales Consummated in 2015 and Associated Estimated Recurring Revenue ($mm) New sales revenue in million $ 17 New Direct Customers  Estimated $1.9mm annual revenue  Contracts are typically multi‐year 3 New Clinical Research Organizations  Estimated $3.5mm over the life of these contracts  The University of Michigan study tails off in 2017  An additional clinical study extension possible for 2016 16 New Channel Partners  Estimated over $4mm annually with ability to grow Numerous New End Customers Through Channel Partners  Estimated $3mm annual revenue  We are positioned to grow with our Channel Partners



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4 Q3 Consolidated Revenue ($mm) 2013 to 2015 Q3 Screening Units 2013 to 2015  Consolidated revenue, which includes screening and wellness services, increased 18% year‐over‐year in Q3 2015; this is the second consecutive year of Q3 growth ̶ Screening business, which includes screenings completed for both channel partners and direct customers, increased 14% over Q3 2014 excluding the impact of the clinical research customer  Q3 screening units increased 17% year‐over‐year; excluding impact of clinical research customer units grew by 22% ̶ As discussed on prior calls, a large clinical research study began to wind down in Q4 2014; 24,400 unit increase in core business offset this expected reduction for the clinical research study Key Takeaways # of Screenings Q3 2015 Results vs. Q3 2013 and Q3 2014 18% Improvement over Q3 2014 17% Growth over Q3 2014 Revenue in million $


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5 Gross Margin ($mm) SG&A Expense ($mm)  Gross Margin dollars increased 15% compared to prior year, primarily driven by increased revenue ̶ Portal and coaching margins offset the winding down of high margin clinical research customer ̶ Gross Margin as a percent of revenue was flat to Q3 2014  SG&A expenses as a percent of revenue decreased 5% compared to 2014 ̶ SG&A expenses flat to Q3 2014 Key Takeaways Q3 2015 Results vs. Q3 2014 15% Improvement 5% Improvement as % of Revenue Gross Margin in million $ SG&A % of Revenue


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6 Net Loss Excluding One‐Time Events ($mm)  Excluding the impact of one‐time events, Net Loss decreased 63% over Q3 2014 Q3 2015 Results vs. Q3 2014 ‐ continued 63% Improvement EBITDA Excluding One‐Time Events ($mm) 87% Improvement  EBITDA excluding one‐time events increased 87% over Q3 2014 Net loss in million $ EBITDA in million $


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 Biometric screenings  Clinical research support  Mobile data collection  Portal activities/msg.  Team challenges  Rewards mall  Incentives  Email/direct mail  Coaching w/medical sensor  plans ‐ future  Onsite health coaching  Telephonic health coaching  Condition management  Online content and seminars  Health assessment  Personal wellness report  plans ‐ future 7 Hooper Services Provide End‐to‐End Integrated Health & Wellness ‐ $ 7 Billion Market Data Collection Screening & Education Engagement Knowledge Aggregation Hooper 2015 Hooper 2014 AHS


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Customer & Client Testimonials “This has been the most well organized, and professionally orchestrated Screening clinic in the history of our onsite program.” – Human Resources Director of a direct customer “The Site Manager and her group did a fantastic job working our event. They were courteous and quick and the professionals everyone wants at their event. Thank you for making our event a true success.” – Channel Partner customer “Thanks for the professional company which did the screening this year – Hooper Holmes is great. The setup was private, the process was easier, technical, painless, and faster. The examiner was sweet and I was relaxed while she took all of my vitals.” – Direct customer “A participant called and wanted to personally thank the examiner she saw the day of her screening. She said her first blood pressure reading was extremely high. The examiner sat with her and tried to calm her down. Since that didn’t appear to be working, she left work and went to the doctor immediately. Her physician put her on medication and she had to stay overnight in the hospital. They are now working together to monitor and lower he blood pressure. She shared with us that she feels like the examiner sincerely saved her life.” – Screening participant “Hooper Holmes offers a user‐friendly portal design to inspire and motivate the employee to take small steps towards better well‐being.” – Large, full service wellness client “After the 2014 health screening I received a phone call that I was eligible to receive health coaching. I took them up on the offer and lost over 30 lbs. between Fall 2014 and Spring 2015. It was just the boost I needed to make some needed health changes.” – Health coaching participant 8


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9 Plan to Raise $4mm in Equity Existing Hooper shareholders offered the opportunity to purchase additional shares of our common stock through a Rights Offering  Provides additional working capital to continue growth as a health and wellness focused company  Ensures sufficient working capital to make investments in sales and marketing, operations, and IT to fuel growth while meeting repayment requirements associated with SWK credit agreement  Validates liquidity position  Anti‐dilutive to those who participate  Directors, executive officers, related parties, and a key shareholder have indicated they intend to participate in the capital raise contributing at least $1mm Summary Capital Structure After Rights Offering: Cash Addition $4.0 million $7mm Revolving Line of Credit $3.4mm at 9/30 Fluctuates based on need SWK Term Loan $5.0 million Total Shares Outstanding TBD Timeline: Draft S‐1 filing November 12, 2015 SEC comment period Up to 30 days Offering period Target close early Q1 2016 For more information contact: SM Berger & Company, Inc. (216) 464‐6400 Overview


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10 Scalable Platform For Growth Our platform supports growth and stability Note: The chart above is for illustrative purposes only and should not be considered guidance or forecast financials Estimated Break‐even