Merge Healthcare, undergoing restructuring, shows another loss

Milwaukee, Wis. — Merge Healthcare's net sales dropped slightly in the second quarter, though it was the company's ongoing restructuring that made the biggest impact on the bottom line compared to a year ago.

Operating losses were $18.3 million. The largest individual contribution was the firm's restructuring initiative, announced in June, which cost $7.5 million in the quarter, including $4.6 million in severance and related employee termination costs. Without the restructuring costs, the operating loss would have looked much more similar to the second-quarter 2006 operating loss of $10.7 million. The restructuring coincided with the second wave of executive resignations, which included CEO Kenneth Rardin.

Net sales for the quarter were $13.3 million, compared to $14 million in Q2 2007. The firm reported a consistent pipeline, with 9 new customers booked in the quarter, the same as the first quarter this year and just one less than in Q2 2007.

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