Merge books positive Q4, makes headway on losses in year-end

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Merge Healthcare showed net income for its fiscal 2008 fourth quarter, which ended Dec. 31, 2008.

For the period, the Milwaukee-based company reported that net sales totaled $15.1 million, compared with net sales of $15.6 million in the fourth quarter of 2007.

Operating income for the fourth quarter was $3.7 million, compared with an operating loss of $8.5 million in the fourth quarter of 2007.

Net income for the fourth quarter of 2008 was $1.9 million, compared to a net loss of $9.5 million in the fourth quarter of 2007. Net income for the fourth quarter of 2008 includes a non-cash charge of $1.4 million due to the impairment of certain equity investments.

During the fourth quarter, the cash balance increased by $3.4 million to $17.8 million. In addition, deferred revenue increased by $1 million to $16.8 million as of the year-end.

"These results show continued positive progress on our turnaround efforts at Merge," said Justin Dearborn, CEO of Merge. "They also indicate our ability to function profitably in a very challenging market."

For the full year, net sales totaled $56.7 million, a downturn compared with $59.6 million in sales for 2007. The operating loss for 2008 was $21.7 million, a significant reduction compared with an operating loss of $171.2 million for 2007.

Total operating loss for 2008 reflects an operating loss of $26.7 million during the first half of the year and operating income of $5 million during the second half of the year. Contributing to the operating loss for 2007 was a goodwill impairment charge of $122.4 million.

Net loss for 2008 totaled $23.7 million, compared with a loss of $171.6 million for 2007.