American CareSource Holdings, Inc. (NASDAQ: ANCI) today announced
record financial and operational results for the three months and
year ended December 31, 2008. Recent highlights include:
-- Reported quarterly net income of $1.5 million, or $0.08 per diluted
share, resulting in six consecutive quarters of profit growth.
-- Achieved $17.7 million in revenue for the fourth quarter, a 74.4%
increase in revenues compared to the same prior year period,
representing seven quarters of sequential revenue growth.
-- Attained quarterly gross margins of approximately 16.3% compared to
approximately 11.8% in the three months ended December 31, 2007,
reflecting continued leverage of the Company's fixed cost
infrastructure.
-- Generated EBITDA, as adjusted, of approximately $1.82 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 year with approximately $10.6 million in cash
and cash equivalents on hand and generated approximately $2.24 million
in cash from operating activities in the fourth quarter and
approximately $6.5 million during the full year of 2008.
-- Claims volume increased to approximately 82,500 for the fourth quarter
of 2008, up 62% over the fourth quarter of 2007.
-- Signed new client agreement with Principal Financial Group to provide a
full range of ancillary care services for its newly launched
proprietary healthcare network, Principal Edge Network.
-- Signed new client agreement with Insurers Administrative Corporation,
expanding growth in the TPA market.
-- Signed new client agreement with InterGroup Services Corporation,
extending reach into the Mid-Atlantic PPO market.
-- Extended contract with HealthSmart Preferred Care II, LP through 2012
and expanded services provided.
-- The Company ranked number one stock performer on The NASDAQ Capital
Market� for 2008.
"We are pleased to report that we exceeded our previously
updated 2008 revenue guidance of $55 to $57 million," stated David
S. Boone, Chief Executive Officer of American CareSource. "As we
move into 2009, we expect annual revenues to range between $85 and
$95 million for the year as we gain additional market share. Our
2009 revenue guidance is based on continued rapid growth which will
be driven by the expansion of services offered to existing clients
as well as the addition of new clients and expansion of our
provider network across the United States."
Revenues for the fourth quarter of 2008 rose 74.4% to $17.7
million compared to $10.1 million in the fourth quarter of 2007.
The Company's fourth quarter revenues also represent a 9.6%
improvement over the third quarter of 2008 reported revenues of
$16.1 million. For the full year ended December 31, 2008, the
Company reported revenues of $58.3 million, a 148.2% increase
compared to revenues of $23.5 million in the same period of
2007.
Net income increased to $1.5 million, or $0.08 per diluted
share, for the three months ended December 31, 2008, compared to
net income of approximately $318 thousand, or $0.02 per share, in
the same period last year. For the full year ended December 31,
2008, net income increased to $3.6 million, or $0.21 per diluted
share, compared to a net loss of $820 thousand, or $0.06 per share,
for the same period in 2007. Net income for the three months ended
December 31, 2008 reflected reduced bonus expenses of approximately
$327 thousand related to variable compensation expense that will be
paid in the form of restricted stock units in lieu of cash. Expense
related to the restricted stock units will be expensed over the
corresponding two year vesting period beginning March 2009.
Cash provided by operations was $6.5 million for the full year
ended December 31, 2008 versus cash used in operations of
approximately $281 thousand during the same period in 2007. Factors
affecting the improvement in operating cash flows include earnings
growth, accelerated client collections and overall effectiveness in
working capital management. The Company has generated positive cash
flow for six consecutive quarters and continues to operate debt
free. At December 31, 2008, the Company had approximately $10.6
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 fourth quarter
and year ended December 31, 2008 as follows:
Date: Tuesday, March 31, 2009
Time: 10:00 a.m. (CT)/11:00 a.m. (ET)
Dial-in numbers: 877-795-3610 (U.S. & Canada) or 719-325-4819
Live webcast: www.anci-care.com, under "Events"
The teleconference replay will be available two hours after
completion through Tuesday, April 7, 2009 at 888-203-1112 (U.S.
& Canada) or 719-457-0820. The replay pass code is 1234640. The
archived webcast will be available for one year on the Company's
investor website, www.anci-care.com, under "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 through its subsidiary,
Ancillary Care Services. 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.
ANCI-F
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 HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended Year ended
December 31, December 31,
-------------------------- --------------------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
Net Revenues $ 17,659,778 $ 10,124,555 $ 58,288,775 $ 23,487,911
Cost of revenues:
Provider payments 12,912,709 7,675,391 42,602,808 17,205,652
Administrative
fees 1,014,458 611,245 3,395,085 1,250,386
Fixed costs 859,798 643,240 3,255,140 2,145,562
------------ ------------ ------------ ------------
Total cost of
revenues 14,786,965 8,929,876 49,253,033 20,601,600
------------ ------------ ------------ ------------
Contribution
margin 2,872,813 1,194,679 9,035,742 2,886,311
Selling, general
and administrative
expenses 1,298,767 1,076,255 5,094,580 3,754,175
Depreciation and
amortization 120,900 80,679 415,459 328,839
------------ ------------ ------------ ------------
Total operating
expenses 1,419,667 1,156,934 5,510,039 4,083,014
------------ ------------ ------------ ------------
Operating income
(loss) 1,453,146 37,745 3,525,703 (1,196,703)
------------ ------------ ------------ ------------
Interest income 45,537 49,657 182,976 200,719
Interest expense (372) (1,414) (4,883) (10,700)
Debt issuance costs - - - (46,300)
------------ ------------ ------------ ------------
Total interest
income, net 45,165 48,243 178,093 143,719
Income (loss)
before income
taxes 1,498,311 85,988 3,703,796 (1,052,984)
Income tax
provision
(benefit) 3,710 (232,754) 65,333 (232,754)
------------ ------------ ------------ ------------
Net Income (loss) $ 1,494,601 $ 318,742 $ 3,638,463 $ (820,230)
============ ============ ============ ============
Earnings (loss) per
common share:
Basic $ 0.10 $ 0.02 $ 0.24 $ (0.06)
============ ============ ============ ============
Diluted $ 0.08 $ 0.02 $ 0.21 $ (0.06)
============ ============ ============ ============
Basic weighted
average common
shares outstanding 15,166,817 14,659,757 15,083,827 14,546,796
============ ============ ============ ============
Diluted weighted
average common
shares outstanding 18,207,577 17,253,245 17,735,576 14,546,796
============ ============ ============ ============
Reconciliation of non-GAAP financial measures to reported
GAAP financial measures
Reconciliation of EBITDA and EBITDA, as adjusted:
Three months ended Year ended
December 31, December 31,
-------------------------- --------------------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
Operating income
(loss) $ 1,453,146 $ 37,745 $ 3,525,703 $ (1,196,703)
Depreciation and
amortization 120,900 80,679 415,459 328,839
------------ ------------ ------------ ------------
EBITDA 1,574,046 118,424 3,941,162 (867,864)
Executive severance - - 21,844 338,010
Non-cash
stock-based
compensation
expense 241,307 216,805 781,340 705,965
------------ ------------ ------------ ------------
EBITDA, as
adjusted $ 1,815,353 $ 335,229 $ 4,744,346 $ 176,111
============ ============ ============ ============
AMERICAN CARESOURCE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
2008 2007
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 10,577,829 $ 4,272,498
Accounts receivable, net 5,788,457 3,651,203
Prepaid expenses and other current assets 495,814 409,445
------------- -------------
Total current assets 16,862,100 8,333,146
Property and equipment, net 915,224 332,450
Other assets:
Certificate of Deposit, restricted - 145,000
Other non-current assets 1,127,114 492,977
Intangible assets, net 1,280,656 1,494,238
Goodwill 4,361,299 4,361,299
------------- -------------
Total assets $ 24,546,393 $ 15,159,110
============= =============
LIABILITIES and SHAREHOLDERS' EQUITY
Current Liabilities:
Due to service providers $ 5,964,392 $ 3,344,278
Accounts payable and accrued liabilities 3,100,839 1,320,036
Current maturities of long-term debt 11,023 55,697
------------- -------------
Total current liabilities 9,076,254 4,720,011
Long-term debt 3,053 50,348
Shareholders' equity 15,467,086 10,388,751
------------- -------------
Total liabilities and shareholders' equity $ 24,546,393 $ 15,159,110
============= =============
AMERICAN CARESOURCE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year ended
December 31,
---------------------------
2008 2007
------------ ------------
Cash flows from operating activities:
Net income (loss) $ 3,638,463 $ (820,230)
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operations:
Stock-based compensation expense 698,863 418,058
Depreciation and amortization 415,462 328,839
Amortization of debt issuance costs - 46,300
Client administration fee expense
related to warrants 82,478 35,276
Deferred income taxes 11,772 (255,731)
Changes in operating assets and
liabilities:
Accounts receivable (2,137,254) (2,316,253)
Prepaid expenses and other assets 346,575 (542,626)
Accounts payable and accrued
liabilities 780,803 558,110
Due to service providers 2,620,114 2,267,104
------------ ------------
Net cash provided by (used in)
operating activities 6,457,276 (281,153)
------------ ------------
Cash flows from investing activities:
Investment in software development costs (492,185) -
Additions to property and equipment (292,469) (181,153)
Redemption of certificate of deposit 145,000 -
------------ ------------
Net cash used in investing
activities (639,654) (181,153)
------------ ------------
Cash flows from financing activities:
Payments on long-term debt (91,969) (348,215)
Proceeds from exercise of stock warrants 127,428 -
Proceeds from exercise of stock options 452,250 57,639
------------ ------------
Net cash provided by (used in)
financing activities 487,709 (290,576)
------------ ------------
Net increase (decrease) in cash and cash
equivalents 6,305,331 (752,882)
Cash and cash equivalents at beginning of
period 4,272,498 5,025,380
------------ ------------
Cash and cash equivalents at end of period $ 10,577,829 $ 4,272,498
============ ============
Contact: Steven J. Armond Chief Financial Officer American
CareSource Holdings, Inc. Tel: 972-308-6847
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