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Quality Systems Q2 profits bolster 53%, beats estimates

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Quality Systems (NASDAQ:QSII), the medical health records company, said that its second-quarter earnings soared 53 percent driven by the US federal government's stimulus plan. 

The company, which makes information systems for the healthcare sector, posted revenues of $107.6 million for the three months ended Sept. 30. That is up from $81.5 million a year ago.

Net income bolstered 53 percent to $20.5 million, or 35 cents per fully diluted share, compared with $13.4 million, or 23 cents, a year-earlier.

Analysts, on average, had expected the company to earn 34 cents on revenues of $103.6 million, according to Yahoo Finance.

Quality’s CEO Steven Plochocki said: "The extraordinary growth and our solid performance stem from sales resulting from decisions made, in part based on the stimulus plan.

"As the stimulus continues to gain momentum, and our pipeline fills, we are realizing the benefit of the positioning and preparation we did in advance. The quarterly results reflect the ongoing acceptance of our solutions and strength of our services in the marketplace."

Under the 2009 federal stimulus package, the US government planned to spend billions to encourage healthcare professionals and hospitals to modernize health records. The spending has been a bonus for the companies that cater to medical information-technology systems. 

Gross margin rose to 66.5 percent from 63 percent, while operating margin rose to 29.3 percent from 19.3 percent.

Quality Systems also announced it will pay a dividend of 17 cents to shareholders on record as of Dec. 20, 2011. The dividend had been adjusted to reflect the two to one stock split that went in to effect yesterday.

Quality Systems, headquartered in Irvine, California, makes and develops electronic health records and revenue cycle management applications. It also makes connectivity products and services for medical, dental and small hospitals.

Shares of Quality lost $3.22, or 7.43 percent, falling to $40.13 Thursday afternoon on the Nasdaq.

Quick facts: Quality Systems, Inc.

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NASDAQ:QSII
Market: NASDAQ
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