CorVel Corporation (NASDAQ:CRVL) Q3 2019 Earnings Conference Call Transcript
Nov 05, 2019 • 11:30 am ET
Thank you for standing by. Welcome to the CorVel Corporation Quarterly Earnings Release Webcast.
During the course of this webcast, CorVel Corporation may make projections or other forward-looking statements regarding future events or the future financial performances of the company. CorVel wishes to caution you that these statements are only predictions and that actual events or results may differ materially.
CorVel refers you to the documents that the company files from time to time with the Securities and Exchange Commission specifically the company's last Form 10-K and 10-Q files for the most recent fiscal year and quarter. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.
I would now like to turn it over to Michael Combs, President and Chief Executive Officer.
Good morning. Thank you for joining us to review CorVel's September quarter. On the call with me today is Brandon O'Brien, CorVel's Chief Financial Officer. Today I will be discussing market trends , strategic themes on which we are focused and the progress that we've made on our key initiatives.
Brandon will then provide an overview of our financial results for the September quarter. Revenues for the September quarter were $147 million. Earnings per share was $0.69, an increase of 2% from $0.67 per share in the same quarter of the prior year.
The earnings per share increase was enabled through a 4% increase in gross profit, a one percentage point decline in the tax rate and a 2% reduction in shares outstanding. The results we are achieving in claims management are predicated on ensuring that all constituents in the claim continuum continue are actively engaged as key events unfold throughout the life of the claim.
This model represents a fundamental change from the historical diary approach to claims management in which stakeholders review claim information in disparate systems as infrequently as every few weeks. Early engagement of the appropriate medical constituencies, the objective of our 24/7 service, which is the first step in guiding an injured employee to appropriate care immediately following an instance of injury.
While we implemented 24/7 many years ago payors including carriers are now more fully appreciating the importance of this service in driving optimal outcomes. The services transitioned from a nice to have, to an essential component in achieving optimal outcomes.
In the workers' compensation claims management space, we have chosen to manage claims to optimize the recovery of injured workers and focus on return to work. We have also chosen to provide a full line of integrated services and have shown that this model can produce results 25% better than the best-of-breed legacy model. In the short-term, this strategic positioning has sacrificed some growth opportunity by reducing unnecessary, but common fees and services.
But in the intermediate term, we are confident that this path of digital transformation will continue to lead to steadily improving results for our customers as well as for our investors. Challenging the