Monday was a busy day for electronic medical data processing company NDCHealth
But before we dig into Monday's details, a little factoid in NDCHealth's amended filings caught my eye. NDCHealth estimates that it touches 45% of all electronic health-care claims in the United States and that it handles a higher volume of electronic health-care claims than any other company. These are pretty big claims, and despite all of the company's recent problems, they may explain why so many analysts were on the call asking questions about the immediate future of a $500 million small cap.
First up on Monday was a restatement of financials from 2002 through the first quarter of 2005, which wiped away $7 million in net income. This is not a huge amount for NDCHealth, but after four years of restructuring charges with no clear end in sight, a large debt load, an ongoing SEC investigation, and the fact that the company is not finished with its Sarbanes-Oxley review, it only hurts credibility. The restatement, coupled with the other ongoing items, also means it's not unreasonable to assume that further restatements are yet to come.
To get back on track and reduce the debt load of $302 million -- $42 million is currently due -- NDCHealth is selling off international operations. If all sales are successful this year, the company believes it could be down to under $100 million in total debt, which is a large improvement. This also refocuses the company's management and resources on what are believed to be its strongest assets.
There's a direct lesson from the Nortel
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Fool contributor Nathan Parmelee wonders why NDCHealth didn't opt for a space in between NDC and Health. He does not own shares in any of the companies mentioned.