TIGroup Second Quarter Revenue Up 57% To $10.2M; Company Announces New Agreements and Financings
May 15, 2009 4:45:00 PM
Copyright Business Wire 2009
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View Additional ProfilesBEVERLY HILLS, Calif.--(BUSINESS WIRE)-- Tri-Isthmus Group, Inc. (TIGroup) (OTCBB:TISG), a provider of financial solutions to the healthcare industry, announced today its financial results for the second quarter of fiscal year 2009 ended March 31, 2009 and for the first six months of fiscal year 2009.
Highlights from operating results for the second fiscal quarter were:
-- Revenue from medical services for the second fiscal quarter totaled
$10.2 million. This represented an increase of 57% from $6.5 million for
the three-month period ended March 31, 2008. Revenue from medical
services totaled $21 million for the first half of the fiscal year. This
represented an increase of 86% from $11.3 million for the comparable
period ended March 31, 2008.
-- Revenue was effectively flat on a sequential quarterly basis but up
significantly on a comparable year-over-year basis.
-- Healthcare operations, which included earnings from surgery centers,
critical access hospitals and medical clinics, generated adjusted EBITDA
of $453,000 for the three-month period and approximately $1.28 million
for the six-month period ended March 31, 2009.
-- The company-wide operating loss before non-cash charges for the quarter
ended March 31, 2009 was ($585,000) compared to operating income of
$321,000 for the period ending March 31, 2008. For the current six
months the operating loss was ($737,000) versus operating income of
$402,000 for the comparable period ending March 31, 2008. Adjusted
company-wide EBITDA was negative ($948,000) reflecting the add-back of
non-cash stock-based compensation, depreciation/amortization and
interest to the overall net loss of ($1.87 million).
-- The company retained a strong cash position with close to $4 million in
available and restricted cash.
Business development and financing activity highlights for the quarter were:
-- Through April 2009, the company completed financings totaling $2.4
million in convertible notes with a conversion feature at $0.625 per
share and Series 5A warrant exercises at a price of $0.50. The company
continues to receive strong support from its existing investor base.
-- The company agreed to a definitive transaction and documentation with
Chandler Medical Group to acquire the business located near the Stroud
Regional Medical Center in Oklahoma. On May 1, 2009 the two companies
began working together with the company providing billing services for
Chandler.
-- The company reached agreement in principle to significantly expand its
presence in San Diego with a leading medical provider group through the
Del Mar Outpatient Surgery Center. The agreement is subject to
completion and final documentation, which is expected to be finalized by
the end of the third fiscal quarter ending June 30, 2009.
-- The company received written commitment for $6 million toward the
recapitalization of the Southern Plains Medical Center property and
building. This transaction is expected to include the refinancing of an
existing $4.5 million bank note due in October 2009 and will free up
$1.5 million in restricted cash. The closing is expected during this
current quarter subject to completion of due diligence, appraisals,
documentation and financing. The company will retain majority ownership
of the building and property after the refinancing.
TIGroup Chairman and CEO David Hirschhorn said, "Our second fiscal quarter was another quarter of important accomplishments and progress. Even in a difficult market, we maintained our top line and generated positive EBITDA in operations. Additionally, we moved closer to finishing the refinancing of our balance sheet with the goal of achieving a 3-to-1 working capital ratio during this calendar year.
"We remain cautiously optimistic that we can continue our growth through the balance of the fiscal year. There are many obvious challenges in both the national and local economies faced by all businesses. These challenges are heightened for our industry by possible changes to our healthcare system for providers, hospitals, insurance companies, employers and the insured by the current administration in Washington D.C. However, our post March 31, 2009 business development pipeline and prospective financing transactions are expected to continue to fuel our growth and help us accomplish our overall goal of profitability in 2009."
Financial tables are provided below.
About Tri-Isthmus Group, Inc.
Tri-Isthmus Group, Inc. (TIGroup) is a financial solutions provider focused on healthcare services operations designed to deliver quality healthcare outside of traditional urban hospital settings. The company is building a portfolio of interests in ambulatory surgical centers, rural hospitals, surgical hospitals and other centers operating in partnership with physicians. For more information, visit http://www.tig3.com.
A profile for investors can be accessed at http://www.hawkassociates.com/profile/tisg.cfm. For investor relations information, contact Frank Hawkins or Julie Marshall, Hawk Associates, at 305-451-1888, e-mail: tigroup@hawkassociates.com. An online investor kit including press releases, current price quotes, stock charts and other valuable information for investors may be found at http://www.hawkassociates.com and http://www.americanmicrocaps.com. To receive free e-mail notification of future releases for TIGroup, sign up at http://www.hawkassociates.com/about/alert/.
Safe-Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the" Exchange Act"), including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to, among other things: (i) the company's financing plans; (ii) trends affecting the company's financial condition or results of operations; (iii) the company's growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words "may," "would," "will," "expect," "estimate," "anticipate," "believe," "intend" and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the risk disclosed in the company's Forms 10-K and 10-Q filed with the SEC.
TRI-ISTHMUS GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except shares and per share data)
March 31, September 30,
2009 2008
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 2,418 $ 2,970
Restricted cash 1,522 1,514
Accounts receivable, net of allowance for 6,739 6,289
uncollectible accounts
Advance to affiliated entity 72 72
Prepaid expenses 517 103
Other current assets 2,230 1,754
Total current assets 13,498 12,702
Property and equipment, net 16,863 12,277
Goodwill 968 759
Other Assets 965 760
Total assets $ 32,294 $ 26,498
LIABILITIES, PREFERRED STOCK AND SHAREHOLDERS'
DEFICIT
Current Liabilities:
Accounts payable $ 2,789 $ 2,944
Accrued expenses 3,203 2,715
Note payable 1,170 -
Current maturities of long-term debt 4,562 4,144
Total current liabilities 11,724 9,803
Long-term debt, net of current portion 10,159 5,455
Commitments and contingencies
Minority interest 1,262 967
The accompanying notes are an integral part of these condensed
consolidated financial statements. Quarterly comparative financial
information is based on unaudited financial reports, prepared by
management, based on previous quarterly filings.
TRI-ISTHMUS GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except shares and per share data)
September 30,
March 31, 2009
2008
(Unaudited)
Non-redeemable Preferred Stock:
Preferred stock Series 1-A ($0.01 par value,
67,600 shares authorized; 67,600 shares issued
and outstanding as of March 31, 2009 and
September 30, 2008)
$ 166 $ 166
Preferred stock Series 2-A ($0.01 par value,
3,900 shares authorized; 3,900 shares issued
and outstanding as of March 31, 2009 and
September 30, 2008)
25 25
Total non-redeemable preferred stock $ 191 $ 191
Redeemable preferred stock:
Preferred stock Series 5-A ($0.01 par value,
9,000 shares authorized; 8,987 shares issued $ 7,819 $ 7,819
and outstanding as of March 31, 2009 and
September 30, 2008)
Preferred stock Series 6-A ($0.01 par value,
5,000 shares authorized; 4,607 shares issued 4,113 4,113
and outstanding as of March 31, 2009 and
September 30, 2008)
Preferred stock Series B issued by subsidiary
($0.01 par value, 38,250 shares authorized, 2,500 2,500
19,990 shares issued and outstanding as of
March 31, 2009 and September 30, 2008)
Total redeemable preferred stock $ 14,432 $ 14,432
Common stock ($0.01 par value, 100,000,000
shares authorized; 10,322,929 shares issued $ 103 $ 103
and outstanding as of March 31, 2009 and
September 30, 2008)
Additional paid-in capital 72,963 71,301
Accumulated deficit (78,488 ) (75,702 )
Other comprehensive loss (52 ) (52 )
Total shareholders' deficit (5,474 ) (4,350 )
Total liabilities, preferred stock and $ 32,294 $ 26,498
shareholders' deficit
The accompanying notes are an integral part of these condensed consolidated
financial statements. Quarterly comparative financial information is based on
unaudited financial reports, prepared by management, based on previous quarterly
filings.
TRI-ISTHMUS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except share and per share data) (Unaudited)
Three months ended Six months ended
March 31, March 31, March 31, March 31,
2009 2008 2009 2008
Revenue from services $ 10,180 $ 6,512 $ 21,001 $ 11,257
Costs and expenses:
Selling, general and 10,765 6,833 21,738 11,659
administrative expenses
Amortization of stock-based 208 62 516 81
compensation
Depreciation and amortization 271 94 502 159
Total costs and expenses 11,244 6,989 22,756 11,899
Operating loss (1,064 ) (477 ) (1,755 ) (642 )
Other income (expense) (221 ) 52 (183 ) 75
Interest expense (440 ) (315 ) (612 ) (509 )
Minority interest (142 ) (90 ) (236 ) (169 )
Net loss from operations before
taxation and non-cash beneficial (1,867 ) (830 ) (2,786 ) (1,245 )
conversion feature
Taxation - - - -
Net loss $ (1,867 ) $ (830 ) $ (2,786 ) $ (1,245 )
Non-cash beneficial conversion - (1,521 ) - (1,521 )
feature preferred dividend
Net loss attributable to common $ (1,867 ) $ (2,351 ) $ (2,786 ) $ (2,766 )
shareholders
Net loss per common share:
Basic $ (0.18 ) $ (0.29 ) $ (0.27 ) $ (0.40 )
Diluted N/A N/A N/A N/A
The accompanying notes are an integral part of these condensed consolidated
financial statements. Quarterly comparative financial information is based on
unaudited financial reports, prepared by management, based on previous
quarterly filings.
TRI-ISTHMUS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) (Unaudited)
Six months ended
March 31, 2009 March 31, 2008
Cash flows from operating activities:
Net loss $ (2,786 ) $ (1,245 )
Adjustments to reconcile net loss to net cash
used in operating activities:
Minority interest 236 169
Depreciation and amortization 502 159
Amortization of stock based compensation 516 81
Amortization of debt discount 166 233
Bad debt provision 2,165 699
Loss from sale of investments 281 -
Changes in working capital components:
Accounts receivable (2,615 ) (1,720 )
Accounts payable 333 48
Others (1,104 ) (314 )
Net cash used in operating activities (2,306 ) (1,890 )
Cash flows from investing activities:
Purchase of property and equipment (3,744 ) (270 )
Acquisition of subsidiaries, net of cash (50 ) 283
acquired
Repayment of advance - 33
Proceeds from sale of equity interests in 60 -
consolidated affiliates
Increase in restricted cash (8 ) -
Net cash provided by (used in) investing (3,742 ) 46
activities
Cash flows from financing activities:
Drawdown of convertible loans 2,150 1,650
Repayment of notes (5,182 ) (54 )
Distributions to minority partners (31 ) -
Issuance of preferred stock Series 5-A, net of - 3,853
costs
Issuance of preferred stock Series 6-A, net of - 3,324
costs
Proceeds from long-term debt 8,559 -
Net cash provided by financing activities 5,496 8,773
Effect of exchange rates on cash - 1
Net increase (decrease) in cash and cash (552 ) 6,930
equivalents
Cash and cash equivalents at beginning of period 2,970 733
Cash and cash equivalents at end of period $ 2,418 $ 7,663
Cash paid for interest $ 587 $ 509
The fair value of warrants issued in conjunction with the convertible notes
amounted to $907,000. The beneficial conversion feature associated with the
convertible notes amounted to $238,000.
The accompanying notes are an integral part of these condensed consolidated
financial statements. Quarterly comparative financial information is based on
unaudited financial reports, prepared by management, based on previous quarterly
filings.
T
Source: Tri-Isthmus Group, Inc.
----------------------------------------------
For Tri-Isthmus Group
Inc.
Beverly Hills
Hawk Associates
Investor Relations:
Frank Hawkins or Julie Marshall
305-451-1888
tigroup@hawkassociates.com
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