American CareSource Holdings, Inc. (NASDAQ: ANCI) today announced
record financial and operational results for the three and nine
months ended September 30, 2008. Recent highlights include:
-- Reported quarterly net income of $1.0 million, or $0.06 per diluted
share, resulting in five consecutive quarters of profit growth.
-- Achieved $16.1 million in revenue for the third quarter, a 127%
increase in revenues compared to the same prior year period,
representing six quarters of sequential revenue growth.
-- Attained gross margins of approximately 16% compared to approximately
14% in the three months ended September 30, 2007, reflecting continued
leverage of the Company's fixed cost infrastructure.
-- Generated EBITDA, as adjusted, of approximately $1.3 million for the
quarter.
-- EBITDA, as adjusted, (a non-GAAP measure) is defined as income
(loss) from operations adjusted for depreciation and
amortization, non-cash warrant and option compensation expense
and executive severance. EBITDA, as adjusted, should be
considered in addition to, but not in lieu of, income (loss) from
operations reported under generally accepted accounting
principles (GAAP).
-- The Company finished the quarter with approximately $8.2 million in
cash and cash equivalents on hand and generated approximately $2.1
million in cash from operating activities in the third quarter and
approximately $4.2 million during the first nine months of 2008.
-- Claims volume increased to approximately 87,000 for the third quarter
of 2008, up 89% over the third quarter of 2007.
-- Signed a new client service contract with JMS and Associates, Inc., to
provide a full range of ancillary care services, initially to one of
JMS' key clients, Insurance Design Administrators (IDA).
-- Signed a new client agreement with Evolutions Healthcare Systems, Inc.,
one of the largest independently owned PPOs.
-- Began trading on The NASDAQ Stock Market� under the symbol "ANCI",
effective September 29, 2008.
Commenting on today's announcement, David S. Boone, Chief
Executive Officer of American CareSource, stated, "Our results this
quarter are a continuation of the momentum we have been building
over the last year. We are continuing to generate strong top-line
growth while proving the organization's ability to translate that
growth into expanding earnings per share. Our recent customer wins,
coupled with our ability to generate strong organic growth within
our existing customer base, demonstrates the attractiveness of the
market we are addressing and our organization's ability to deliver
ancillary cost savings to our clients.
"Based on the strength of this quarter's results and our
continued positive future outlook, we are increasing our 2008
revenue guidance from $50 - $55 million to $55 - $57 million."
Revenues for the third quarter of 2008 rose 127% to $16.1
million compared to $7.1 million in the third quarter of 2007. The
Company's third quarter revenues also represent a 24% improvement
over the second quarter of 2008 reported revenues of $13.0 million.
For the nine months ended September 30, 2008, the Company reported
revenues of $40.6 million, a 204% increase compared to revenues of
$13.4 million in the same period of 2007.
The Company reported net income of $1.0 million, or $0.06 per
diluted share, for the three months ended September 30, 2008,
compared to net income of approximately $188,000, or $0.01 per
share, in the same period last year. For the nine months ended
September 30, 2008, the Company reported net income of $2.1
million, or $0.12 per diluted share, compared to a net loss of $1.1
million, or $0.08 per share, for the same period in 2007.
Cash provided by operations was $4.2 million for the nine months
ended September 30, 2008 versus cash used in operations of
approximately $969,000 during the same period in 2008. Factors
affecting the improvement in operating cash flows include earnings
growth, accelerated client collections and overall effectiveness in
working capital management. At September 30, 2008, the Company had
approximately $8.2 million in cash and cash equivalents compared to
$4.3 million at December 31, 2007.
Conference Call
As previously announced, American CareSource will hold a
conference call to discuss financial results of the third quarter
ended September 30, 2008 as follows:
Date: Thursday, November 13, 2008
Time: 10:00 a.m. (CT)/11:00 a.m. (ET)
Dial-in numbers: 877-856-1956 (U.S. & Canada) or 719-325-4818
Live webcast: www.anci-care.com, under "New & Events"
The teleconference replay will be available two hours after
completion through Thursday, November 20, 2008 at 888-203-1112
(U.S. & Canada) or 719-457-0820. The replay pass code is
6431291. The archived webcast will be available for one year on the
Company's investor website, www.anci-care.com, under "News and
Events."
About Ancillary Healthcare Services
American CareSource provides ancillary healthcare services
through its network that offers cost effective alternatives to
physician and hospital-based services. This market is estimated at
$574 billion, and has grown to 30% of total national health
expenditures. These providers offer services in over 30 categories,
including laboratories, dialysis centers, free-standing diagnostic
imaging centers, non-hospital surgery centers, as well as durable
medical equipment such as orthotics and prosthetics, and
others.
About American CareSource Holdings, Inc.
American CareSource Holdings, the first national, publicly
traded ancillary care network services company, offers a
comprehensive national network of approximately 2,500 ancillary
service providers at over 25,000 sites. The Company's ancillary
network and management provides a complete outsourced solution for
a wide variety of healthcare payors and plan sponsors including
self-insured employers, indemnity insurers, PPOs, HMOs, third party
administrators and both federal and local governments. For
additional information, please visit www.anci-care.com.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995:
Any statements that are not historical facts contained in this
release, including with respect to future engagements by clients,
revenue growth, earnings, and guidance are forward-looking
statements. It is possible that the assumptions made by American
CareSource Holdings, Inc. for purposes of such statements may prove
to be inaccurate or may not materialize. Actual results may differ
materially from those projected or implied in any forward-looking
statements. Such statements may involve further risks and
uncertainties, including but not limited to those relating to
demand for our services, pricing, market acceptance, our ability to
integrate with our clients, our ability to attract and maintain
providers, our ability to manage growth, the effect of economic
conditions, and the affect of competitive services, risks in
product development, the ability to complete transactions, and
other risks identified in this release, and the Securities and
Exchange Commission filings of American CareSource Holdings,
Inc.
(Tables to Follow)
AMERICAN CARESOURCE HOLDING, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
Three months ended Nine months ended
September 30, September 30,
-------------------------- --------------------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
Net Revenues $ 16,110,795 $ 7,088,499 $ 40,628,998 $ 13,363,356
Cost of revenues 13,554,352 6,091,789 34,466,067 11,671,724
------------ ------------ ------------ ------------
Gross profit 2,556,443 996,710 6,162,931 1,691,632
Selling, general
and administrative
expenses 1,488,455 766,648 3,795,813 2,677,920
Depreciation and
amortization 105,887 86,445 294,559 248,160
------------ ------------ ------------ ------------
Total operating
expenses 1,594,342 853,093 4,090,372 2,926,080
------------ ------------ ------------ ------------
Operating income
(loss) 962,101 143,617 2,072,559 (1,234,448)
------------ ------------ ------------ ------------
Interest income (65,531) (47,430) (137,439) (151,063)
Interest expense 1,067 2,836 4,511 9,286
Debt issuance costs - - - 46,300
------------ ------------ ------------ ------------
Total interest
(income) expense,
net (64,464) (44,594) (132,928) (95,477)
Income (loss)
before income
taxes 1,026,565 188,211 2,205,487 (1,138,971)
Income tax
provision 25,559 - 61,623 -
------------ ------------ ------------ ------------
Net Income (Loss) $ 1,001,006 $ 188,211 $ 2,143,864 $ (1,138,971)
============ ============ ============ ============
Earnings (loss) per
common share:
Basic $ 0.07 $ 0.01 $ 0.14 $ (0.08)
============ ============ ============ ============
Diluted $ 0.06 $ 0.01 $ 0.12 $ (0.08)
============ ============ ============ ============
Basic weighted
average common
shares outstanding 15,139,839 14,555,314 15,029,161 14,511,642
============ ============ ============ ============
Diluted weighted
average common
shares outstanding 18,044,602 16,888,882 17,577,846 14,511,642
============ ============ ============ ============
Reconciliation of non-GAAP financial measures to reported GAAP financial
measures
Reconciliation of EBITDA and EBITDA, as adjusted:
Three months ended Nine months ended
September 30, September 30,
------------------------- --------------------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
Operating income
(loss) $ 962,101 $ 143,617 $ 2,072,559 $ (1,234,448)
Depreciation and
amortization 105,887 86,445 294,559 248,160
------------ ------------ ------------ ------------
EBITDA 1,067,988 230,062 2,367,118 (986,288)
Executive severance - - 21,844 338,010
Non-cash stock-based
compensation expense 197,433 127,161 540,035 342,012
------------ ------------ ------------ ------------
EBITDA, as adjusted $ 1,265,421 $ 357,223 $ 2,928,997 $ (306,266)
============ ============ ============ ============
AMERICAN CARESOURCE HOLDING, INC.
CONSOLIDATED BALANCE SHEET
September 30,
2008 December 31,
(unaudited) 2007
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 8,221,348 $ 4,272,498
Accounts receivable, net 4,960,235 3,651,203
Prepaid expenses and other current assets 371,134 409,445
------------- -------------
Total current assets 13,552,717 8,333,146
Property and equipment, net 807,745 332,450
Other assets:
Certificate of Deposit, restricted - 145,000
Other non-current assets 432,644 492,977
Intangible assets, net 1,334,052 1,494,238
Goodwill 4,361,299 4,361,299
------------- -------------
Total assets $ 20,488,457 $ 15,159,110
============= =============
LIABILITIES and SHAREHOLDERS' EQUITY
Current Liabilities:
Due to service providers $ 5,077,322 $ 3,344,278
Accounts payable and accrued liabilities 1,919,484 1,320,036
Current maturities of long-term debt 10,765 55,697
------------- -------------
Total current liabilities 7,007,571 4,720,011
Long-term debt 5,911 50,348
Shareholders' equity 13,474,975 10,388,751
------------- -------------
Total liabilities and shareholders' equity $ 20,488,457 $ 15,159,110
============= =============
AMERICAN CARESOURCE HOLDING, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Nine months ended
September 30,
--------------------------
2008 2007
------------ ------------
Cash flows from operating activities:
Net income (loss) $ 2,143,864 $ (1,138,971)
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operations:
Stock-based compensation expense 485,568 319,965
Depreciation and amortization 294,559 248,160
Amortization of debt issuance costs - 46,300
Client administration fee expense related
to warrants 54,467 22,047
Changes in operating assets and
liabilities:
Accounts receivable (1,309,032) (1,132,521)
Prepaid expenses and other assets 205,510 (550,488)
Accounts payable and accrued
liabilities 599,448 412,378
Due to service providers 1,733,044 804,528
------------ ------------
Net cash provided by (used in)
operating activities 4,207,428 (968,602)
------------ ------------
Cash flows from investing activities:
Investment in software development costs (351,605) -
Additions to property and equipment (258,065) (139,563)
Redemption of certificate of deposit 145,000 -
------------ ------------
Net cash used in investing activities (464,670) (139,563)
------------ ------------
Cash flows from financing activities:
Payments on long-term debt (89,369) (339,308)
Proceeds from exercise of stock warrants 127,428 -
Proceeds from exercise of stock options 168,033 52,226
------------ ------------
Net cash provided by (used in)
financing activities 206,092 (287,082)
------------ ------------
Net increase (decrease) in cash and cash
equivalents 3,948,850 (1,395,247)
Cash and cash equivalents at beginning of
period 4,272,498 5,025,380
------------ ------------
Cash and cash equivalents at end of period $ 8,221,348 $ 3,630,133
============ ============
Contact: Steven J. Armond Chief Financial Officer American
CareSource Holdings, Inc. Tel: 972-308-6847
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