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National Mentor repays $40 million revolver draw
By Jennifer Lanning Drey
Portland, Ore., Jan. 6 - National Mentor Holdings, Inc. repaid $40 million of funds drawn in October under its revolving credit facility on Dec. 31, Denis Holler, chief financial officer of National Mentor, said Tuesday during the company's fourth-quarter earnings conference call.
The company ended fiscal 2008 with a cash balance of $38.9 million and total operating company debt of $513.9 million at Sept. 30.
During the fourth quarter, National Mentor's cash balance declined by $13.1 million, but the cash balance increased by $9.5 million for the full year.
National Mentor's fourth-quarter revenues grew by $9.0 million, or 3.8%. At the same time, adjusted EBITDA decreased to $22.0 million, down 5.8% from the same quarter in 2007.
Adjusted EBITDA was negatively impacted by the ongoing effects of a change in reimbursement policy in North Carolina, Edward "Ned" Murphy, the company's chief executive officer, said.
In addition, volume growth was negatively impacted by actions taken by some states to contain costs, and short-term profitability was impacted by investments made by the company in its business processes and infrastructure programs, he said.
In response, the company has curtailed some of the investments as well as reduced discretionary spending and divested underperforming units and exited lower performing markets.
"We expect the next 12 to 30 months will be very challenging for our public payers, and we're taking appropriate steps to ensure that we remain financially strong throughout this period and poised to seize on opportunities to grow and serve more individuals who would benefit from our service," Murphy said.
Boston-based National Mentor provides home and community-based human services.
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