Shows a Net Profit from Property Sale and Continues to Reduce Losses
SPRINGFIELD, Ohio, Nov. 14 /PRNewswire-FirstCall/ -- AdCare Health Systems, Inc. (AMEX:ADK), an Ohio based long term care, home care and management company, today reported financial results for the third quarter of 2007.
Revenues for the quarter ended September 30th, 2007 were $5,906,326 as compared to $5,660,337 for the same quarter in 2006, an increase of $245,989, or 4.3%. The increase was due to improved occupancy in our assisted living properties and an increase in visits made by our nurses and caregivers at our home health care division.
The loss before discontinued operations for the quarter ended September 30, 2007 was $212,840 as compared to a loss of $655,599 for the quarter ended September 30, 2006, an improvement of $442,759. The improvement was due to an increased occupancy at our assisted living properties, more visits made by our staff at our home health care division and lower interest expense as a result of the expenses related to the mezzanine financing in 2005 being fully recognized in 2006.
Net income for the quarter ended September 30th, 2007 was $395,785 as compared to a loss of $654,646 for the quarter ended September 30th, 2006, an improvement of $1,050,431. Approximately $618,000 of this improvement resulted from recognizing a gain on the sale of assets in our discontinued operations.
David A. Tenwick, Chairman of AdCare, stated that "AdCare reduced its losses this quarter and looks for continued improvement. For the nine months of 2007, the loss before discontinued operations was $539,360 as compared to a loss of $1,908,864 for the nine months of 2006. The loss this year would have been reduced by an additional $137,000 if not for increased fees for a letter of credit extension relating to changing banks and expenses for a discontinued acquisition. If you add the profit from the sale of assets from discontinued operations, we had a net profit of $48,125 for the nine months. AdCare continues to make progress." Mr. Tenwick further stated "We are refinancing some of our properties to improve cash flow and are actively engaged in seeking out suitable acquisitions to further the growth of AdCare." AdCare Health Systems, Inc. will host a conference call on Thursday, November 15th, 2007 at 4:15 PM EST. The dial-in number is 1-800-257-2182.
About AdCare Health Systems, Inc.
AdCare Health Systems, Inc. (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 920 employees provide high-quality care for patients and residents residing in the 15 facilities that they manage, seven of which are assisted living facilities, six skilled nursing centers and two independent senior living communities. The Company has ownership interests in seven of those facilities. In the ever expanding marketplace of long term care, AdCare's mission is to provide quality healthcare services to the elderly.
(Investor Relations website: http://www.b2i.us/irpass.asp?BzID=1540&to=ea&s=0 ) 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 SHEETS September 30, December 31,
2007 2006
(Unaudited)
ASSETS
Current Assets:
Cash $1,168,803 $2,136,414
Certificate of deposit, restricted 207,298 198,266
Accounts receivable:
Long-term care resident receivables, net 2,187,632 1,949,745
Management, consulting and development
receivables, net 252,566 254,321
Advances and receivables from affiliates 24,664 35,897
Assets of discontinued operations 446 4,677
Prepaid expenses and other 501,621 337,638
Total current assets 4,343,030 4,916,958 Restricted Cash 957,343 914,941
Property and Equipment, Net 14,228,260 13,750,870
Note Receivable, Net 230,413 257,413
License, Net 1,189,306 1,189,306
Goodwill 2,638,193 2,638,193
Assets of Discontinued Operations, Net of
Current Portion - 880,430
Other Assets 1,041,615 838,283
Total assets $24,628,160 $25,386,394 LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of notes payable and other
debt $ 813,798 $ 744,131
Current portion of note payable to
stockholder 9,466 828,344
Accounts payable and accrued expenses 3,767,172 3,804,590
Liabilities of discontinued operations - 22,177
Total current liabilities 4,590,436 5,399,242 Notes Payable and Other Debt, Net of Current
Portion 12,625,359 12,909,162 Note Payable to Stockholder, Net of Current
Portion 811,433 -
Other Liabilities 338,263 262,597
Forward Purchase Contract 900,000 900,000
Liabilities of Discontinued Operations - 848,394
Minority Interest in Equity of Consolidated
Entities 228,815 160,259
Total liabilities 19,494,306 20,479,654 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 and 3,778,129 shares issued and
outstanding 14,036,155 13,857,166
Accumulated deficit (8,902,301) (8,950,426)
Total stockholders' equity 5,133,854 4,906,740
Total liabilities and stockholders' equity $ 24,628,160 $ 25,386,394
ADCARE HEALTH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) Three-Months Ended Nine-Months Ended
September 30, September 30,
2007 2006 2007 2006 Revenues:
Patient care
revenues $5,468,027 $5,226,756 $16,292,143 $15,352,272
Management,
consulting and
development fee
revenue 438,299 433,581 1,310,908 1,271,254
Total revenue 5,906,326 5,660,337 17,603,051 16,623,526 Expenses:
Payroll and related
payroll costs 3,746,406 3,559,660 11,088,853 10,559,092
Other operating
expenses 1,855,225 1,824,999 5,559,608 5,336,836
Depreciation and
amortization 222,843 191,407 632,126 563,951
Total expenses 5,824,474 5,576,066 17,280,587 16,459,879
Income from Continuing
Operations 81,852 84,271 322,464 163,647 Other Income (Expense):
Interest income 13,586 11,472 46,894 13,920
Interest expense,
others (250,693) (753,797) (767,465) (2,104,304)
Interest expense,
related parties (16,023) (20,771) (35,683) (62,887)
Minority interest
in (earnings)
losses of
consolidated
entities (4,548) 23,226 (68,556) 80,760
Other expense (37,014) - (37,014) -
(294,692) (739,870) (861,824) (2,072,511) Loss Before
Discontinued
Operations (212,840) (655,599) (539,360) (1,908,864)
Discontinued Operations:
Income from
discontinued
operations 608,625 953 587,485 (23,643)
Net Income (Loss) $395,785 $(654,646) $ 48,125 (1,932,507) Net Income (Loss)
Per Share, Basic and Diluted:
Continuing
operations $(0.06) $(0.33) $(0.14) $(0.96)
Discontinued
operations 0.16 0.00 0.16 (0.01)
$0.10 $(0.33) $0.02 $(0.97) Weighted Average Common
Shares Outstanding,
Basic 3,786,129 1,996,150 3,786,129 1,996,150 Diluted 3,786,129 1,996,150 3,786,129 1,996,150
DATASOURCE: AdCare Health Systems, Inc.
CONTACT: David Tenwick, Chairman of the Board of AdCare Health Systems, Inc., +1-937-964-8974, Web site: http://www.adcarehealth.com/ http://www.b2i.us/irpass.asp?BzID=1540&to=ea&s=0
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