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PEABODY, Mass., May 12, 2010 (BUSINESS WIRE) --PHC, Inc., d/b/a Pioneer Behavioral Health (NYSE Amex: PHC), ("Pioneer" or the "Company"), a leading provider of inpatient and outpatient behavioral health services, reported financial results for the Company's 2010 third fiscal quarter ended March 31, 2010. The results exclude the operations of the Company's research division, Pivotal Research Centers, Inc. ("Pivotal"), which was sold during the 2009 third fiscal quarter and was accounted for as a discontinued operation in fiscal 2009.
Total net revenues from continuing operations increased 12.7% to $13.5 million for the three months ended March 31, 2010 compared to $12.0 million for the three months ended March 31, 2009. Net patient care revenues increased 14.3% to $12.7 million for the three months ended March 31, 2010 from $11.1 million for the three months ended March 31, 2009. The increase in revenues was due primarily to increased census across the Company's facilities, including higher census at Seven Hills Hospital in Las Vegas and the Company's new chemical dependency unit at Harbor Oaks Hospital in Michigan, which opened in September 2009. Contract support services revenue provided by Wellplace declined 6.7% to $0.8 million for the three months ended March 31, 2010 compared to $0.9 million for the same period last year. The decrease was due to decreases in covered lives under our EAP (Employee Assistance Program) contracts.
Income from operations improved to $781,000 for the 2010 fiscal third quarter compared to $98,000 in the same period a year ago. Income before taxes was $758,000 for the three-month period ended March 31, 2010 compared to $12,000 in the year-earlier period. Net income applicable to common shareholders was $0.5 million for the fiscal 2010 third quarter, or $0.02 per diluted share, compared to a net loss of $0.2 million or $0.01 per share in the fiscal 2009 third quarter. The fiscal 2009 third quarter results included an expense of $159,031 associated with Pivotal. The 2010 fiscal third quarter represented the Company's fifth consecutive quarter of profitability.
For the nine months ended March 31, 2010, total net revenues from continuing operations was $39.0 million compared to $34.7 million in the year earlier period. Net patient care revenues were $36.5 million for the nine months ended March 31, 2010 compared to $31.8 million in the previous year period. In the same nine-month period, income from operations was $1.7 million compared to a loss of $1.2 million in the same nine months in fiscal 2009. Net income applicable to common stockholders was $1.0 million for the nine months ended March 31, 2010, or $0.05 per diluted share compared to a net loss of $2.2 million, or a loss of $0.11 per share, for the previous year period. The net loss included a $1.4 million charge associated with the sale of Pivotal and related discontinued operations.
As of March 31, 2010, the Company had cash and cash equivalents of $3.3 million. Stockholders' equity improved from $16 million as of June 30, 2009 to $16.9 million as of March 31, 2010.
"We continue to generate strong operating results across all of our patient care facilities as reflected by the double digit increase in patient care revenue and strong sequential revenue growth," said Bruce A. Shear, Pioneer's president and CEO. "In addition to strong patient growth, profitability also increased, as gross margin from net patient care revenue increased from 44.5% in the year earlier period to 48.2% in the current quarter. Margins also improved sequentially due to a more favorable mix of patients. We continue to experience growing census across our facilities and believe there will be additional opportunities for organic expansion, such as the recently opened ten-bed adolescent unit at Seven Hills Behavioral Institute in Henderson, Nevada. The Hospital provides psychiatric, alcohol and drug addiction treatment for adolescents and adults, and is already operating at capacity. In addition to these opportunities, we are selectively pursuing acquisitions that would allow the Company to accelerate its growth. We expect the trends that we have experienced over the past year to continue."
The Company will hold a conference call at 4:15 p.m. eastern time today, to discuss the results. Interested parties should dial (866) 362-5158 (domestically) or (617) 597-5397 (internationally) and use conference passcode 74366943. A replay of the call will be available for 30 days and can be accessed by dialing 888-286-8010 (domestically) or 617-801-6888 (internationally) and using passcode 63189881.
About PHC d/b/a Pioneer Behavioral Health
PHC, Inc., d/b/a Pioneer Behavioral Health, is a national healthcare company providing behavioral health services in five states, including substance abuse treatment facilities in Utah and Virginia, and inpatient and outpatient psychiatric facilities in Michigan, Pennsylvania, and Nevada. The Company also offers internet and telephonic-based referral services that includes employee assistance programs and critical incident services. Contracted services with government agencies, national insurance companies, and major transportation and gaming companies cover more than one million individuals. Pioneer helps people gain and maintain physical, spiritual and emotional health through delivering the highest quality, most culturally responsive and compassionate behavioral health care programs and services. For more information, visit www.phc-inc.com.
Statement under the Private Securities Litigation Reform Act of 1995
This press release may include "forward-looking statements" that are subject to risks and uncertainties. Forward-looking statements include information about possible or assumed future results of the operations or the performance of the Company and its future plans and objectives. Various future events or factors may cause the actual results to vary materially from those expressed in any forward-looking statements made in this press release. For a discussion of these factors and risks, see the Company's annual report on Form 10-K for the most recently ended fiscal year.
| PHC, INC. AND SUBSIDIARIES | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Unaudited) | ||||||||
| March 31, | June 30, | |||||||
| 2010 | 2009 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 3,266,591 | $ | 3,199,344 | ||||
|
Accounts receivable, net of allowance for doubtful accounts of $ 2,878,903 at March 31, 2010 and $2,430,618 at June 30, 2009 |
8,472,136 | 6,315,693 | ||||||
| Other receivables-third party | -- | 170,633 | ||||||
| Prepaid expenses | 593,187 | 441,945 | ||||||
| Prepaid income taxes | 225,936 | 33,581 | ||||||
| Other receivables and advances | 751,867 | 674,357 | ||||||
| Deferred income tax asset - current | 923,625 | 923,625 | ||||||
| Total current assets | 14,233,342 | 11,759,178 | ||||||
| Restricted cash | 512,197 | 512,197 | ||||||
| Accounts receivable, non-current | 40,447 | 35,000 | ||||||
| Other receivables | 63,490 | 55,627 | ||||||
| Property and equipment, net | 4,640,095 | 4,687,110 | ||||||
| Deferred income tax asset - non-current | 1,902,354 | 1,902,354 | ||||||
|
Deferred financing costs, net of amortization of $546,338 and $436,440 at March 31, 2010 and June 30, 2009 |
225,903 | 335,801 | ||||||
| Goodwill | 969,098 | 969,098 | ||||||
| Other assets | 2,305,118 | 2,435,628 | ||||||
| Total assets | $ | 24,892,044 | $ | 22,691,993 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,551,707 | $ | 1,375,436 | ||||
| Current maturities of long-term debt | 795,793 | 652,837 | ||||||
| Revolving credit note | 1,282,757 | 863,404 | ||||||
| Current portion of obligations under capital leases | 111,185 | 103,561 | ||||||
| Accrued payroll, payroll taxes and benefits | 2,043,835 | 1,570,639 | ||||||
| Accrued expenses and other liabilities | 1,285,386 | 1,111,321 | ||||||
| Total current liabilities | 7,070,663 | 5,677,198 | ||||||
| Long-term debt, net of current maturities | 304,235 | 488,426 | ||||||
| Obligations under capital leases | 48,174 | 132,368 | ||||||
| Long-term accrued liabilities | 523,299 | 350,178 | ||||||
| Total liabilities | 7,946,371 | 6,648,170 | ||||||
| Stockholders' equity: | ||||||||
| Preferred Stock, 1,000,000 shares authorized, none issued or outstanding | -- | -- | ||||||
|
Class A common stock, $.01 par value, 30,000,000 shares authorized, 19,867,826 and 19,840,793 shares issued at March 31, 2010 and June 30, 2009, respectively |
198,678 | 198,408 | ||||||
|
Class B common stock, $.01 par value, 2,000,000 shares authorized, 775,021 and 775,080 issued and outstanding at March 31, 2010 and June 30, 2009, respectively, each convertible into one share of Class A common stock |
7,750 | 7,751 | ||||||
| Additional paid-in capital | 27,886,437 | 27,667,597 | ||||||
|
Treasury stock, 896,804 and 626,541 shares of Class A common stock at March 31, 2010 and June 30, 2009, respectively, at cost |
(1,423,980 | ) | (1,125,707 | ) | ||||
| Accumulated deficit | (9,723,212 | ) | (10,704,226 | ) | ||||
| Total stockholders' equity | 16,945,673 | 16,043,823 | ||||||
| Total liabilities and stockholders' equity | $ | 24,892,044 | $ | 22,691,993 | ||||
| PHC, INC. AND SUBSIDIARIES | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| March 31, | March 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| Revenues: | ||||||||||||||||
| Patient care, net | $ | 12,692,869 | $ | 11,106,894 | $ | 36,452,909 | $ | 31,772,332 | ||||||||
| Contract support services | 839,305 | 899,275 | 2,591,256 | 2,946,058 | ||||||||||||
| Total revenues | 13,532,174 | 12,006,169 | 39,044,165 | 34,718,390 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Patient care expenses | 6,576,086 | 6,167,572 | 19,454,431 | 18,232,036 | ||||||||||||
| Cost of contract support services | 733,603 | 718,979 | 2,202,584 | 2,318,263 | ||||||||||||
| Provision for doubtful accounts | 547,810 | 413,077 | 1,476,128 | 1,167,220 | ||||||||||||
| Administrative expenses | 4,893,235 | 4,609,001 | 14,259,979 | 14,181,365 | ||||||||||||
| Total operating expenses | 12,750,734 | 11,908,629 | 37,393,122 | 35,898,884 | ||||||||||||
| Income (loss) from operations | 781,440 | 97,540 | 1,651,043 | (1,180,494 | ) | |||||||||||
| Other income (expense): | ||||||||||||||||
| Interest income | 39,023 | 39,553 | 101,130 | 135,028 | ||||||||||||
| Other income | 18,260 | 43,680 | 141,921 | 99,422 | ||||||||||||
| Interest expense | (80,520 | ) | (168,705 | ) | (241,998 | ) | (346,653 | ) | ||||||||
| Total other income (expense), net | (23,237 | ) | (85,472 | ) | 1,053 | (112,203 | ) | |||||||||
| Income (loss) before taxes | 758,203 | 12,068 | 1,652,096 | (1,292,697 | ) | |||||||||||
| Income tax (benefit) provision | 289,031 | 4,680 | 671,081 | (501,373 | ) | |||||||||||
| Income (loss) from continuing operations | 469,172 | 7,388 | 981,015 | (791,324 | ) | |||||||||||
| Discontinued operations - net of tax benefit of $100,760 and $892,784 for the three months and nine months ended March 31, 2009, respectively - Pivotal |
-- |
(159,031 |
) |
-- |
(1,409,095 |
) |
||||||||||
|
Net income (loss) applicable to common shareholders |
$ |
469,172 |
$ |
(151,643 |
) |
$ |
981,015 |
$ |
(2,200,419 |
) |
||||||
| Basic net income (loss) per common share | ||||||||||||||||
| Continuing operations | $ | 0.02 | $ | 0.00 | $ | 0.05 | $ | (0.04 | ) | |||||||
| Discontinued operations | -- | (0.01 | ) | -- | (0.07 | ) | ||||||||||
| $ | 0.02 | $ | (0.01 | ) | $ | 0.05 | $ | (0.11 | ) | |||||||
| Basic weighted average number of shares outstanding | 19,762,241 | 20,017,703 | 19,854,099 | 20,109,622 | ||||||||||||
| Diluted net income (loss) per common share | ||||||||||||||||
| Continuing operations | $ | 0.02 | $ | 0.00 | $ | 0.05 | $ | (0.04 | ) | |||||||
| Discontinued operations | -- | (0.01 | ) | -- | (0.07 | ) | ||||||||||
| $ | 0.02 | $ | (0.01 | ) | $ | 0.05 | $ | (0.11 | ) | |||||||
| Diluted weighted average number of shares outstanding | 19,861,449 | 20,017,703 | 19,963,141 | 20,109,622 | ||||||||||||
SOURCE: PHC, Inc.
PHC, Inc.
Bruce A. Shear, 978-536-2777
President & CEO
or
Investor Relations:
CEOcast, Inc.
Dan Schustack, 212-732-4300