Healthcare Services Group, Inc. Reports Results for the Three Months Ended March 31, 2001

Apr 24, 2001, 01:00 ET from Healthcare Services Group, Inc.

    BENSALEM, Pa., April 24 /PRNewswire Interactive News Release/ --
 Healthcare Services Group, Inc. (Nasdaq:   HCSG) reported that revenues for the
 three months ended March 31, 2001, increased by 11% to $66,618,000 compared to
 $60,128,000 for the same 2000 period.  Net income for the three months ended
 March 31, 2001, was $1,629,000 or $.15 per basic and diluted common share,
 compared to the 2000 first quarter net income of $1,501,000 or $.14 per basic
 and diluted common share, representing an increase of 9% in net income.
 
     Forward-Looking Statements/Risk Factors
     Certain matters discussed may include forward-looking statements that are
 subject to risks and uncertainties that could cause actual results or
 objectives to differ materially from those projected.  Such risks and
 uncertainties include, but are not limited to, risks arising from the Company
 providing its services exclusively to the health care industry, primarily
 providers of long-term care; credit and collection risks associated with this
 industry; the effects of changes in regulations governing the industry and
 risk factors described in the Company's Form 10-K filed with the Securities
 and Exchange Commission for the year ended December 31, 2000, in Part I
 thereof under "Government Regulation of Clients," "Competition" and "Service
 Agreements/Collections."  The Company's clients have been adversely affected
 by the change in Medicare payments under the 1997 enactment of the Prospective
 Payment System ("PPS"), as well as other trends in the long-term care industry
 resulting in certain of the Company's clients filing voluntary bankruptcy
 petitions.  Others may follow.  These factors, in addition to delays in
 payments from clients, has resulted in and could result in additional bad
 debts in the near future.  Additionally, the Company's operating results would
 also be adversely affected if unexpected increases in labor and labor-related
 costs, materials, supplies and equipment used in performing its services could
 not be passed on to clients.
     In addition, the Company believes that to improve its future financial
 performance it must continue to obtain service agreements with new clients,
 provide new services to existing clients, achieve modest price increases on
 current service agreements with existing clients and maintain internal cost
 reduction strategies at the various operational levels of the Company.
 Furthermore, the Company believes that its ability to sustain the internal
 development of managerial personnel is an important factor impacting future
 operating results and successfully executing projected growth strategies.
     Healthcare Services Group, Inc. is the largest national provider of
 professional housekeeping, laundry and food services to long-term care and
 related facilities.
 
                                           HEALTHCARE SERVICES GROUP, INC.
                                       CONDENSED CONSOLIDATED BALANCE SHEETS
                                                      (Unaudited)
 
                                              March 31, 2001  Dec. 31, 2000
 
     Cash and cash equivalents                 $21,418,000     $22,842,000
     Accounts receivable, net                   51,771,000      52,744,000
     Prepaid income taxes                                        1,129,000
     Deferred income taxes                       1,010,000         839,000
     Other current assets                       10,210,000      10,568,000
     Property and equipment                      4,959,000       5,158,000
     Cost in excess of fair value of net
         assets acquired                         1,693,000       1,720,000
     Deferred income taxes                       1,378,000       1,366,000
     Other assets                               12,553,000      11,977,000
 
                                              $104,992,000    $108,343,000
 
 
     Accrued insurance claims current             $905,000        $907,000
     Other current liabilities                   8,560,000      13,220,000
     Accrued insurance claims                    3,404,000       3,411,000
     Stockholders' equity                       92,123,000      90,805,000
 
                                              $104,992,000    $108,343,000
 
 
 
                                          HEALTHCARE SERVICES GROUP, INC.
                                        CONSOLIDATED STATEMENTS OF INCOME
                                                    (Unaudited)
 
                                            For the Three Months Ended
                                                    March 31,
                                                2001           2000
 
     Revenues                                $66,618,000    $60,128,000
     Operating costs and expenses:
        Cost of services provided             59,082,000     53,225,000
        Selling, general and administrative    5,172,000      4,655,000
     Other income:
         Interest income                         307,000        213,000
 
     Income before income taxes                2,671,000      2,461,000
     Income taxes                              1,042,000        960,000
 
     Net income                               $1,629,000     $1,501,000
 
 
     Basic earnings per common share                $.15           $.14
 
 
     Diluted earnings per common share              $.15           $.14
 
 
     Basic weighted average number of
          common shares outstanding           10,948,372     11,033,140
 
 
     Diluted weighted average number of
          common shares outstanding           10,972,080     11,107,838
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X85225927
 
 

SOURCE Healthcare Services Group, Inc.
    BENSALEM, Pa., April 24 /PRNewswire Interactive News Release/ --
 Healthcare Services Group, Inc. (Nasdaq:   HCSG) reported that revenues for the
 three months ended March 31, 2001, increased by 11% to $66,618,000 compared to
 $60,128,000 for the same 2000 period.  Net income for the three months ended
 March 31, 2001, was $1,629,000 or $.15 per basic and diluted common share,
 compared to the 2000 first quarter net income of $1,501,000 or $.14 per basic
 and diluted common share, representing an increase of 9% in net income.
 
     Forward-Looking Statements/Risk Factors
     Certain matters discussed may include forward-looking statements that are
 subject to risks and uncertainties that could cause actual results or
 objectives to differ materially from those projected.  Such risks and
 uncertainties include, but are not limited to, risks arising from the Company
 providing its services exclusively to the health care industry, primarily
 providers of long-term care; credit and collection risks associated with this
 industry; the effects of changes in regulations governing the industry and
 risk factors described in the Company's Form 10-K filed with the Securities
 and Exchange Commission for the year ended December 31, 2000, in Part I
 thereof under "Government Regulation of Clients," "Competition" and "Service
 Agreements/Collections."  The Company's clients have been adversely affected
 by the change in Medicare payments under the 1997 enactment of the Prospective
 Payment System ("PPS"), as well as other trends in the long-term care industry
 resulting in certain of the Company's clients filing voluntary bankruptcy
 petitions.  Others may follow.  These factors, in addition to delays in
 payments from clients, has resulted in and could result in additional bad
 debts in the near future.  Additionally, the Company's operating results would
 also be adversely affected if unexpected increases in labor and labor-related
 costs, materials, supplies and equipment used in performing its services could
 not be passed on to clients.
     In addition, the Company believes that to improve its future financial
 performance it must continue to obtain service agreements with new clients,
 provide new services to existing clients, achieve modest price increases on
 current service agreements with existing clients and maintain internal cost
 reduction strategies at the various operational levels of the Company.
 Furthermore, the Company believes that its ability to sustain the internal
 development of managerial personnel is an important factor impacting future
 operating results and successfully executing projected growth strategies.
     Healthcare Services Group, Inc. is the largest national provider of
 professional housekeeping, laundry and food services to long-term care and
 related facilities.
 
                                           HEALTHCARE SERVICES GROUP, INC.
                                       CONDENSED CONSOLIDATED BALANCE SHEETS
                                                      (Unaudited)
 
                                              March 31, 2001  Dec. 31, 2000
 
     Cash and cash equivalents                 $21,418,000     $22,842,000
     Accounts receivable, net                   51,771,000      52,744,000
     Prepaid income taxes                                        1,129,000
     Deferred income taxes                       1,010,000         839,000
     Other current assets                       10,210,000      10,568,000
     Property and equipment                      4,959,000       5,158,000
     Cost in excess of fair value of net
         assets acquired                         1,693,000       1,720,000
     Deferred income taxes                       1,378,000       1,366,000
     Other assets                               12,553,000      11,977,000
 
                                              $104,992,000    $108,343,000
 
 
     Accrued insurance claims current             $905,000        $907,000
     Other current liabilities                   8,560,000      13,220,000
     Accrued insurance claims                    3,404,000       3,411,000
     Stockholders' equity                       92,123,000      90,805,000
 
                                              $104,992,000    $108,343,000
 
 
 
                                          HEALTHCARE SERVICES GROUP, INC.
                                        CONSOLIDATED STATEMENTS OF INCOME
                                                    (Unaudited)
 
                                            For the Three Months Ended
                                                    March 31,
                                                2001           2000
 
     Revenues                                $66,618,000    $60,128,000
     Operating costs and expenses:
        Cost of services provided             59,082,000     53,225,000
        Selling, general and administrative    5,172,000      4,655,000
     Other income:
         Interest income                         307,000        213,000
 
     Income before income taxes                2,671,000      2,461,000
     Income taxes                              1,042,000        960,000
 
     Net income                               $1,629,000     $1,501,000
 
 
     Basic earnings per common share                $.15           $.14
 
 
     Diluted earnings per common share              $.15           $.14
 
 
     Basic weighted average number of
          common shares outstanding           10,948,372     11,033,140
 
 
     Diluted weighted average number of
          common shares outstanding           10,972,080     11,107,838
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X85225927
 
 SOURCE  Healthcare Services Group, Inc.