Allscripts Healthcare Solutions Inc. (NASDAQ: MDRX) fired its board chairman, saw three directors leave in protest, and announced the resignation of the company’s CFO all at the same time that it reported quarterly earnings that were half the consensus estimates. This perfect storm of negative factors adds up to a -40% drop in the company’s share price.
Allscripts’ chairman, Phil Pead, had been CEO of Eclipsys, a company Allscripts acquired in 2010. He will receive a severance package described in the “terminated without cause” clause in his contract. The three directors who opposed Pead’s firing resigned following the decision to fire Pead.
The company’s CFO is leaving to accept a position with a company outside the healthcare industry. He has been temporarily replaced by another former employee of Eclipsys.
Finally, the earnings collapse was blamed on lower-than-expected sales and “an unfavorable sales mix.” Presumably that latter was due to “a number of our clients and prospects [who] delayed commitments as they wait for us to introduce new releases and demonstrate more robust integration.” Those clients and prospects are probably scattered to the four winds today.
Shares are down -40.7% at $9.50 after posting a new 52-week intraday low of $9.00 earlier. The prior 52-week range had been $13.85-$21.92. The stock closed at $16.02 last night.