AdCare Health Systems, Inc. Reports 2009 Third Quarter Earnings Results; Third Consecutive Profitable Quarter
SPRINGFIELD, Ohio, Nov. 16 /PRNewswire-FirstCall/ -- AdCare Health Systems, Inc. (NYSE AMEX: ADK), an Ohio based long term care, home care and management company, today reported financial results for its third quarter of 2009.
Revenues for the quarter ended September 30, 2009 were $6,909,499 as compared to $6,185,760 for the same quarter in 2008, an increase of $723,739. The increase was mostly due to better occupancy at our skilled nursing centers and improved revenues at our home health care provider. Also, there was an increase in the number of patients covered by Medicare at our nursing centers as well as covered for services provided by our home health care agency.
The net income attributable to AdCare Health Systems for the quarter ended September 30, 2009 was $200,017 as compared to a loss of $664,449 for the third quarter ended September 30, 2008, an improvement of $864,466. Basic and diluted net income per share for the quarter ended September 30, 2009 was $0.05 as compared to a basic and diluted net loss per share of ($0.18) for the same quarter ended September 30, 2008, an improvement of $0.23 per share.
Revenues for the nine-months ended September 30, 2009 were $19,907,515 as compared to $18,194,838 for the same period in 2008, an increase of $1,712,677. Net income attributable to AdCare Health Systems for the nine-months ended September 30, 2009 was $442,932 as compared to a loss of $780,595 for the same period in 2008, an improvement of $1,223,527. The increase was again mostly due to better occupancy at our skilled nursing centers and improved revenues at our home health care division together with servicing more Medicare patients. The significant improvement in net income would have been higher without the $413,954 gain on the acquisition of the Lincoln Lodge in the second quarter of 2008. Basic and diluted net income per share for the nine-months ended September 30, 2009 was $0.12 as compared to a basic and diluted net loss per share of ($0.21) for the same nine-months period ended September 30, 2008, an improvement of $0.33 per share.
David A. Tenwick, Chairman of AdCare, stated that "all the hard work since becoming a public company is starting to pay off with three consecutive profitable quarters. We have been able to increase revenues and occupancy at several of our facilities, control expenses in this difficult economic environment; and at the same time, maintain our commitment to be the provider of choice in the areas we serve by providing quality care." He continued, "Our financial performance continues to improve with income from operations for the first nine months of 2009, increasing to $1,429,701 from a loss of $131,766 for the same period last year. In addition, we continued to improve our working capital position by $919,020, since the end of 2008 with current assets now $378,998 more than current liabilities." He added that "AdCare is now focusing on acquisition opportunities in the health care field that will expand our operations, and is confident that Chris Brogdon, recently appointed Chief Acquisition Officer, will be able to accelerate this expansion through his efforts to locate and assist in funding selective acquisitions of nursing homes and assisted living facilities."
On November 10, 2009, AdCare refinanced its 30-unit assisted living facility located in Van Wert, Ohio. AdCare was the developer and is the owner and manager of the property. Red Mortgage Capital, Inc., as FHA/LEAN lender, processed and funded the total $2,181,200 Section 232/223(f) refinancing at an annual interest rate of 5.1% for a period of 35 years. The Company now has long term, fixed rate HUD financing in place on all eight properties in which the Company has ownership interests.
About AdCare Health Systems, Inc.
AdCare Health Systems, Inc. (NYSE AMEX: ADK) develops, owns and manages assisted living facilities, nursing homes and retirement communities and provides home health care services. Prior to becoming a publicly traded company in November of 2006, AdCare operated as a private company for 18 years. AdCare's 900 employees provide management, development and accounting/financial services to 20 long term care facilities, nine of which are assisted living facilities, ten skilled nursing centers and one independent senior living community totaling over 1,400 beds. The Company has ownership interests in eight of those facilities. In the ever expanding marketplace of long term care, AdCare's mission is to provide quality healthcare services to the elderly.
Safe Harbor Statement
Statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of federal law. Such forward-looking statements reflect management's beliefs and assumptions and are based on information currently available to management. The forward-looking statements involve known and unknown risks, results, performance or achievements of the Company to differ materially from those expressed or implied in such statements. Such factors are identified in the public filings made by the Company with the Securities and Exchange Commission and include the Company's ability to secure lines of credit and/or an acquisition credit facility, find suitable acquisition properties at favorable terms, changes in the health care industry because of political and economic influences, changes in regulations governing the industry, changes in reimbursement levels including those under the Medicare and Medicaid programs and changes in the competitive marketplace. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements.
ADCARE HEALTH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
September 30, December 31,
2009 2008
---- ----
ASSETS (Unaudited)
------
Current Assets:
Cash $2,031,370 $1,266,315
Accounts receivable:
Long-term care resident receivables, net 2,019,183 2,008,847
Management, consulting and
development receivables, net 114,433 258,811
Advances and receivables from affiliates 37,638 17,635
Prepaid expenses and other 434,965 478,534
--------- ---------
Total current assets 4,637,589 4,030,142
--------- ---------
Restricted cash 1,107,646 1,155,596
Property and equipment, net 16,447,215 16,772,660
License, net 1,189,307 1,189,307
Goodwill 2,679,482 2,679,482
Other assets 916,687 1,012,340
---------- ----------
Total assets $26,977,926 $26,839,527
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current Liabilities:
Current portion of notes payable
and other debt $663,078 $713,323
Current portion of notes
payable to stockholder 9,432 9,432
Accounts payable 722,606 1,009,002
Accrued expenses 2,863,475 2,838,407
--------- ---------
Total current liabilities 4,258,591 4,570,164
--------- ---------
Notes payable and other debt,
net of current portion 16,498,924 16,974,788
Notes payable to stockholder,
net of current portion 28,748 34,626
Other liabilities 570,690 299,314
Income tax payable 201,932 170,007
---------- ----------
Total liabilities 21,558,885 22,048,899
Stockholders' equity:
Preferred stock, no par value; 500,000
shares authorized; no shares
issued or outstanding - -
Common stock and additional paid-in capital,
no par value; 14,500,000 shares authorized;
3,786,129 shares issued and outstanding 14,933,652 14,766,967
Accumulated deficit (9,802,600) (10,245,532)
---------- ------------
Total stockholders' equity 5,131,052 4,521,435
Noncontrolling interest in subsidiaries 287,989 269,193
--------- ---------
Total equity 5,419,041 4,790,628
---------- ----------
Total liabilities and stockholders'
equity $26,977,926 $26,839,527
=========== ===========
See notes to consolidated financial statements
ADCARE HEALTH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three-Months Ended Nine-Months Ended
September 30, September 30,
------------- -------------
2009 2008 2009 2008
---- ---- ---- ----
Revenues:
Patient care
revenues $6,434,186 $5,731,938 $18,513,767 $16,874,113
Management,
consulting and
development
fee revenue 475,313 453,822 1,393,748 1,320,725
--------- --------- --------- ---------
Total revenue 6,909,499 6,185,760 19,907,515 18,194,838
--------- --------- ---------- ----------
Expenses:
Payroll and related
payroll costs 3,929,280 4,162,908 11,376,737 11,447,782
Other operating
expenses 2,250,032 2,086,919 6,418,118 6,223,303
Depreciation and
amortization 231,773 222,500 682,959 655,519
--------- --------- ---------- ----------
Total expenses 6,411,085 6,472,327 18,477,814 18,326,604
--------- --------- ---------- ----------
Income (Loss) from
Operations 498,414 (286,567) 1,429,701 (131,766)
------- -------- --------- --------
Other Income (Expense):
Interest income 520 6,381 2,926 20,609
Interest expense,
others (292,364) (352,931) (886,311) (972,641)
Interest expense,
related parties (489) (14,598) (1,717) (43,044)
Other expense (1,622) - (50,946) -
------ ------- ------- -------
(293,955) (361,148) (936,048) (995,076)
-------- -------- -------- --------
Gain on Acquisition - - - 413,954
------ ------- ------- -------
Income (Loss) Before
Income Taxes 204,459 (647,715) 493,653 (712,888)
Income Tax Expense (10,641) (10,641) (31,925) (31,925)
------- ------- ------- -------
Net Income (Loss) 193,818 (658,356) 461,728 (744,813)
Net (Income) Loss
Attributable to
Noncontrolling
Interests 6,199 (6,093) (18,796) (35,782)
----- ------ ------- -------
Net Income (Loss)
Attributable to AdCare
Health Systems $200,017 $(664,449) $442,932 $(780,595)
======== ======== ======== ========
Net Income (Loss)
Per Share, Basic: $0.05 $(0.18) $0.12 $(0.21)
===== ====== ===== ======
Net Income (Loss)
Per Share, Diluted: $0.05 $(0.18) $0.12 $(0.21)
===== ====== ===== ======
Weighted Average Common
Shares Outstanding,
Basic 3,786,129 3,786,129 3,786,129 3,786,129
========= ========= ========= =========
Diluted 3,998,789 3,786,129 3,998,789 3,786,129
========= ========= ========= =========
See notes to consolidated financial statements.
ADCARE HEALTH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine-Months Ended
September 30,
2009 2008
---- ----
Cash flows from operating activities:
Net income (loss) inclusive of
noncontrolling interest $461,728 $(744,813)
Adjustments to reconcile net income (loss)
to net cash
provided by operating activities:
Depreciation and amortization 682,959 655,519
Warrants issued for services 40,486 75,462
Stock option compensation expense 120,776 243,948
Note receivable forgiveness exchanged for
rent - 9,000
Gain on acquisition - (413,954)
Changes in certain assets and liabilities:
Accounts receivable 114,039 321,298
Prepaid expenses and other 3,830 (24,680)
Other assets 95,653 (121,132)
Accounts payable and accrued expenses (261,328) 208,151
Income tax liability 31,925 31,925
Other liabilities 271,377 (88,317)
------- -------
Net cash provided by operating activities 1,561,445 152,407
Cash flows from investing activities:
Distribution to noncontrolling interest - (50,000)
Proceeds from the sale of assets, net of
associated costs 892 2,500
Increase in restricted cash 47,950 77,639
Restricted cash received upon acquisition
of assets - 19,813
Assets transferred to noncontrolling
interest upon acquisition - (6,651)
Purchase of property plant and equipment (343,245) (286,689)
-------- --------
Net cash used in investing activities (294,403) (243,388)
Cash flows from financing activities:
Proceeds from notes payable - 2,287,127
Stock issuance 30,000 -
Repayment of notes payable to stockholder (5,878) (760,000)
Prepaid financing costs - 159,130
Repayment of notes payable (526,109) (560,587)
-------- --------
Net cash (used in) provided by financing
activities (501,987) 1,125,670
Net Increase in Cash 765,055 1,034,689
Cash, Beginning 1,266,315 926,625
--------- -------
Cash, Ending $2,031,370 $1,961,314
========== ==========
Supplemental Disclosure of Cash Flow Information:
Cash paid during the year for interest $876,987 $855,030
======== ========
Supplemental Disclosure of Non-Cash Activities:
Rent in exchange of note receivable
repayment $- $9,000
== ======
Acquisition of assets in exchange for note
forgiveness $- $2,740,584
== ==========
See notes to consolidated financial statements.
SOURCE AdCare Health Systems, Inc.
RELATED LINKS
http://www.adcarehealth.com
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