PSAI Pediatric Services OF America (MM)

Pediatric Services of America, Inc. d/b/a PSA HealthCare (NASDAQ:PSAI) announced today financial results for the second quarter of fiscal year 2007, ended March 31, 2007. Highlights of PSA�s results for the second quarter ended March 31, 2007, include: Acquiring the pediatric assets of Americare At Home Inc., Wilko Enterprises, Inc., and Maternal Child Health, Inc. Achieving 928,000 staffed hours in the PDN business. Achieving revenue growth, including acquisitions, of 15% over second quarter of fiscal year 2006. For the second quarter of fiscal 2007, net revenue from continuing operations was $33,644,000. Income before income tax expense from continuing operations was $6,000. �We�ve made solid progress on the acquisition front. As we continue to grow, improving our profitability will be paramount,� said Daniel J. Kohl President and CEO. Conference Call A conference call to discuss these results has been scheduled for Wednesday May 9, 2007 at 11:00 a.m. ET. The dial-in number for all Participants is 800-374-1702. Note: To join the Q&A session, please press the asterisk followed by 1. If you are unable to listen to the live broadcast, replays of the conference call will be available until May 23, 2007 by dialing 800-642-1687. To connect with the replay of the conference call, please refer to the PSA HealthCare earnings call, Passcode: 8491237 #. PSA provides comprehensive pediatric home health care services through a network of over 54 branch offices in 18 states, including satellite offices and branch office start-ups. Through these offices, PSA provides a combination of services, including pediatric private duty nursing (PDN) and pediatric day treatment centers (PPECs). Additional information on PSA may be found on the Company's website at http://www.psahealthcare.com. NOTE: This press release contains certain forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) relating to future financial performance of Pediatric Services of America, Inc. d/b/a PSA Healthcare (the �Company�). When used in this press release, the words �may,� �targets,� �goal,� �will,� �could,� �should,� �would,� �believe,� �feel,� �expects,� �confident,� �anticipate,� �estimate,� �intend,� �plan,� �potential� and similar expressions may be indicative of forward-looking statements. These statements by their nature involve substantial risks and uncertainties, certain of which are beyond the Company�s control. The Company cautions that various factors, including the factors described hereunder and those discussed in the Company�s other filings with the Securities and Exchange Commission, as well as general economic conditions, industry trends, the Company�s proposed merger with Portfolio Logic LLC (or its failure to complete that merger because of a number of factors, including the failure to obtain the requisite approval of its stockholders and the failure to satisfy other closing conditions), the Company's anticipated uses of the proceeds from the sale of its Pharmacy and RTES Businesses, assimilate and manage previously acquired field operations, collect accounts receivable, including receivables related to acquired businesses and receivables under appeal, hire and retain qualified personnel and comply with and respond to billing requirements issues, including those related to the Company�s billing and collection system, nurse shortages, HIPAA regulations, adverse litigation, workers� compensation losses, availability and cost of medical malpractice insurance and reduced state funding levels and nursing hours authorized by Medicaid programs, and the impact of changes resulting from the recently enacted Medicare Act, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements of the Company made by or on behalf of the Company. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of an unanticipated event. New factors emerge from time to time, and it is not possible for management to predict all of such factors. Further, management cannot assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. PSA HEALTHCARE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands, Except Per Share Data) � � � Three Months Ended March 31, March 31, � 2007� � 2006� � � Net revenue $ 33,644� $ 29,203� Costs and expenses: Costs of goods and services (exclusive of depreciation shown separately below) 20,960� 17,494� Other operating costs and expenses Administrative and marketing salaries, wages and benefits 5,416� 4,910� Business insurance 1,495� 1,408� Overhead � 1,903� � 1,841� Other operating costs and expenses 8,814� 8,159� Corporate, general and administrative Salaries, wages and benefits 2,469� 3,329� Business insurance 63� 59� Professional services 1,196� 1,044� Overhead � 608� � 675� Corporate, general and administrative 4,336� 5,107� Provision for doubtful accounts 215� 60� Provision for insurance recoveries (134) -� Depreciation and amortization � 279� � 246� Total costs and expenses � 34,470� � 31,066� � Operating loss (826) (1,863) Other income -� 5� Interest income 832� 626� Interest expense � -� � (4) � Income (loss) from continuing operations before income tax expense (benefit) 6� (1,236) Income tax expense (benefit) � 2� � (446) Income (loss) from continuing operations 4� (790) Discontinued operations: Income from discontinued operations before income tax (benefit) expense -� 2,145� Income tax (benefit) expense (1) 837� Income from discontinued operations � 1� � 1,308� (Loss) gain on disposal of discontinued operations before income tax benefit (17) 38� Income tax benefit (9) (42) (Loss) gain on disposal of discontinued operations � (8) � 80� Net (loss) income $ (3) $ 598� � Income per share data: Basic net (loss) income per share data: Income (loss) from continuing operations $ 0.00� $ (0.11) Income from discontinued operations 0.00� 0.18� (Loss) gain on disposal of discontinued operations � (0.00) � 0.01� Net (loss) income $ (0.00) $ 0.08� � Diluted net (loss) income per share data: Income (loss) from continuing operations $ 0.00� $ (0.11) Income from discontinued operations 0.00� 0.18� (Loss) gain on disposal of discontinued operations � (0.00) � 0.01� Net (loss) income $ (0.00) $ 0.08� � � Weighted average shares outstanding: Basic � 7,549� � 7,372� Diluted � 7,734� � 7,372� � Nursing � PPEC Consolidated Total � Three Months Ended March 31, 2007 � Net revenue $ 31,092� $ 2,552� $ 33,644� � Costs of goods and services (exclusive of depreciation shown separately below) � Nursing and therapist salaries, wages, benefits and supplies 20,864� 66� 20,930� Disposables/Supplies � 21� � � 9� � 30� Total cost of goods and services 20,885� 75� 20,960� Other operating costs and expenses Administrative and marketing salaries, wages and benefits 3,910� 1,506� 5,416� Business Insurance 1,377� 118� 1,495� Overhead � 1,529� � � 374� � 1,903� Total operating costs and expenses 6,816� 1,998� 8,814� � Provision for doubtful accounts 199� 16� 215� Depreciation � 59� � � 69� � 128� � Branch office contribution margin $ 3,133� � $ 394� $ 3,527� � Three Months Ended March 31, 2006 � Net revenue $ 26,404� $ 2,799� $ 29,203� � Costs of goods and services (exclusive of depreciation shown separately below) � Nursing and therapist salaries, wages, benefits and supplies 17,341� 126� 17,467� Disposables/Supplies � 12� � � 15� � 27� Total cost of goods and services 17,353� 141� 17,494� Other operating costs and expenses Administrative and marketing salaries, wages and benefits 3,408� 1,502� 4,910� Business Insurance 1,302� 106� 1,408� Overhead � 1,400� � � 441� � 1,841� Total operating costs and expenses 6,110� 2,049� 8,159� � Provision for doubtful accounts 106� (46) 60� Depreciation � 38� � � 46� � 84� � Branch office contribution margin $ 2,797� � $ 609� $ 3,406� � � � � � � Three Months Three Months Ended Ended March 31, March 31, 2007� 2006� � Total profit for reportable segments $ 3,527� $ 3,406� � Corporate, general and administrative (4,336) (5,107) Corporate depreciation and amortization (151) (162) Provision for insurance recoveries 134� -� Other income -� 5� Interest income 832� 626� Interest expense -� (4) � � � � Income (loss) from continuing operations, before income tax expense (benefit) $ 6� � $ (1,236)