Birner Dental Management Services, Inc. Announces Earnings For 1Q 2013

DENVER, May 9, 2013 /PRNewswire/ -- Birner Dental Management Services, Inc. (NASDAQ Capital Market: BDMS), operators of PERFECT TEETH® dental practices, announced results for the quarter ended March 31, 2013.  For the quarter ended March 31, 2013, revenue increased $405,000, or 2.5%, to $16.6 million. The Company's earnings before interest, taxes, depreciation, amortization, and non-cash expense associated with stock-based compensation ("Adjusted EBITDA") decreased $27,000, or 1.9%, to $1.4 million.  Net income for the quarter ended March 31, 2013 decreased $67,000, or 21.9%, to $241,000 compared to $309,000 for the quarter ended March 31, 2012.  Earnings per share decreased to $0.13 for the quarter ended March 31, 2013 compared to $0.17 for the quarter ended March 31, 2012.

As previously announced, in January 2013, the Company changed the operating strategy of its Vantage Dental Implant Center ("Vantage").  Vantage will no longer provide All-on-4™ services to its patients, and the Company has converted Vantage into a traditional Perfect Teeth specialty office providing oral surgery and endodontic services.  For the quarter ended March 31, 2012, revenue from All-on-4™ services was approximately $200,000.  The Company had no revenue from these services in the quarter ended March 31, 2013 because of the change in operating strategy.

The Company has signed a lease for a de novo office in the Loveland, Colorado market and anticipates this office will open early in the third quarter of 2013.

During the quarter ended March 31, 2013, the Company had capital expenditures of $492,000, paid out approximately $405,000 in dividends to its shareholders and decreased total bank debt outstanding by approximately $674,000.  During the quarter ended March 31, 2013, the Company converted two of its offices to digital radiography. 

Birner Dental Management Services, Inc. acquires, develops, and manages geographically dense dental practice networks in select markets in Colorado, New Mexico, and Arizona.  The Company currently manages 65 dental offices, of which 37 were acquired and 28 were de novo developments.  The Company currently has 123 dentists.  The Company operates its dental offices under the PERFECT TEETH® name.

The Company previously announced it would conduct a conference call to review results for the quarter ended March 31, 2013 on Thursday, May 9, 2013 at 9:00 a.m. MT. In addition to current operating results, the teleconference may include discussion of management's expectations of future financial and operating results. To participate in this conference call, dial in to 1-888-556-4997 and refer to Confirmation Code 9998560 approximately five minutes prior to the scheduled time. If you are unable to join the conference call on May 9, the rebroadcast number is 1-888-203-1112 with the pass code of 9998560.  This rebroadcast will be available through May 23, 2013.

Non-GAAP Disclosures

This press release includes a non-GAAP financial measure with respect to Adjusted EBITDA.  Please see below for more information regarding Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income.

Forward-Looking Statements

Certain of the matters discussed herein may contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from expectations. These include statements regarding potential de novo offices and the Company's prospects and performance in future periods.  These statements involve known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.  These and other risks and uncertainties are set forth in the reports filed by the Company with the Securities and Exchange Commission. The Company disclaims any obligation to update these forward-looking statements.

For Further Information Contact:
Birner Dental Management Services, Inc.
Dennis Genty   
Chief Financial Officer
(303) 691-0680

 


BIRNER DENTAL MANAGEMENT SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)



Quarters Ended




March 31,




2012


2013








REVENUE:

$   16,199,687


$   16,604,302








DIRECT EXPENSES:






Clinical salaries and benefits

9,137,850


9,712,539



Dental supplies

676,992


706,649



Laboratory fees

753,456


760,376



Occupancy

1,365,316


1,457,577



Advertising and marketing

675,562


362,827



Depreciation and amortization

649,562


819,881



General and administrative

1,209,468


1,210,900




14,468,206


15,030,749









Contribution from dental offices

1,731,481


1,573,553








CORPORATE EXPENSES:






General and administrative 

1,167,494

(1)

1,104,988

(1)


Depreciation and amortization

35,289


46,253








OPERATING INCOME

528,698


422,312



Interest expense, net

22,480


26,716








INCOME BEFORE INCOME TAXES

506,218


395,596



Income tax expense

197,424


154,282








NET INCOME

$        308,794


$        241,314









Net income per share of Common Stock - Basic

$              0.17


$              0.13









Net income per share of Common Stock - Diluted

$              0.17


$              0.13









Cash dividends per share of Common Stock

$              0.22


$              0.22









Weighted average number of shares of

Common Stock and dilutive securities: 











Basic

1,847,024


1,845,375









Diluted

1,859,522


1,857,088



(1)

Corporate expenses - general and administrative includes $232,765 of stock-based compensation expense pursuant to ASC Topic 718 for the quarter ended March 31, 2012 and $131,008 of stock-based compensation expense pursuant to ASC Topic 718 for the quarter ended March 31, 2013.

 

 

BIRNER DENTAL MANAGEMENT SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS




December 31, 


March 31,

ASSETS

2012


2013

CURRENT ASSETS:





Cash and cash equivalents

$          1,112,511


$             808,886


Accounts receivable, net of allowance for doubtful

accounts of approximately $304,000 and $288,000, respectively





2,614,152


3,355,086


Notes Receivable

165,718


160,317


Deferred tax asset

205,693


243,641


Income Tax Receivable

442,630


-


Prepaid expenses and other assets

482,297


827,848







Total current assets

5,023,001


5,395,778






PROPERTY AND EQUIPMENT, net

7,894,333


7,745,186






OTHER NONCURRENT ASSETS:





Intangible assets, net

10,193,488


9,968,346


Deferred charges and other assets

158,316


158,316







Total assets

$        23,269,138


$        23,267,626






LIABILITIES AND SHAREHOLDERS' EQUITY









CURRENT LIABILITIES:





Accounts payable 

$          1,919,457


$          1,896,828


Accrued expenses

1,640,076


1,583,816


Accrued payroll and related expenses

1,718,417


2,450,713


Income taxes payable

-


84,517


Current maturities of long-term debt

400,000


400,000







Total current liabilities

5,677,950


6,415,874






LONG-TERM LIABILITIES:





Deferred tax liability, net

2,997,808


2,916,643


Long-term debt, net of current maturities

6,074,042


5,400,000


Other long-term obligations

1,547,369


1,585,880







Total liabilities

16,297,169


16,318,397






SHAREHOLDERS' EQUITY:





Preferred Stock, no par value, 10,000,000 shares





authorized; none outstanding

-


-


Common Stock, no par value, 20,000,000 shares authorized;

1,842,402 and 1,851,598 shares issued and outstanding, respectively





329,236


471,392


Retained earnings

6,642,733


6,477,837







Total shareholders' equity

6,971,969


6,949,229







Total liabilities and shareholders' equity

$        23,269,138


$        23,267,626






Reconciliation of Adjusted EBITDA

Adjusted EBITDA is not a U.S. generally accepted accounting principle ("GAAP") measure of performance or liquidity. However, the Company believes that it may be useful to an investor in evaluating the Company's ability to meet future debt service, capital expenditures and working capital requirements, and the Company uses Adjusted EBITDA for this purpose.  Investors should not consider Adjusted EBITDA in isolation or as a substitute for operating income, cash flows from operating activities or any other measure for determining the Company's operating performance or liquidity that is calculated in accordance with GAAP. In addition, because Adjusted EBITDA is not calculated in accordance with GAAP, it may not necessarily be comparable to similarly titled measures employed by other companies. A reconciliation of Adjusted EBITDA to net income can be made by adding depreciation and amortization expense - Offices, depreciation and amortization expense – Corporate, stock-based compensation expense, interest expense, net and income tax expense to net income as in the table below.

 





Quarters





Ended March 31,





2012


2013

RECONCILIATION OF EBITDA:





Net income

$308,794


$241,314


Add back:






Depreciation and amortization - Offices

649,562


819,881



Depreciation and amortization - Corporate

35,289


46,253



Stock-based compensation expense

232,765


131,008



Interest expense, net

22,480


26,716



Income tax expense

197,424


154,282








Adjusted EBITDA

$1,446,314


$1,419,454

 

SOURCE Birner Dental Management Services, Inc.



RELATED LINKS
http://www.bdms-perfectteeth.com

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