Agility Health Reports Third Quarter 2014 Financial Results
GRAND RAPIDS, MICHIGAN--(Marketwired - Nov. 28, 2014) -
Agility Health, Inc. ("Agility Health or "the Company") (TSX
VENTURE:AHI), today reports its financial results for the three-month
and nine-month periods ended September 30, 2014. All amounts are
expressed in U.S. dollars unless indicated otherwise.
During the first three quarters of 2014, the Company focused its efforts on improving its operational performance, strengthening its management team, realigning its administrative cost, continuing internal software development as well as discontinuing certain operations.
Financial and Operating Highlights for the Third Quarter ended September 30, 2014 and Year-to-Date
(All comparative figures are for the corresponding period of the prior year)
Administrative Cost Realignment
During the third quarter of 2014, the Company completed a restructuring of certain administrative functions across each of the operating segments of the Company, as well as corporate administration. The restructuring resulted in the reassignment of certain administrative responsibilities, intended to increase leverage of existing administrative personnel. The Company expects that the administrative restructuring will result, beginning in the fourth quarter of 2014, in the reduction of approximately $1 million in annual salaries and benefits within selling, general and administrative expenses. At September 30, 2014, the Company had accrued and expensed $250,000 of severance expenses related to the administrative cost realignment.
Discontinued Operations
The third quarter of 2014, included a decision by the Company to discontinue operations at its subsidiary located in the greater Boston, Massachusetts area. The discontinued operations contributed a net loss of $2.8 million or $0.04 per share, for the year ended December 31, 2013 and has contributed a net loss of $1.1 million, or $0.01 per share, for the nine month period ended September 30, 2014.
The Company has initiated measures during the third quarter to ensure that overall selling, general and administrative (SG&A) costs return to historical levels on a percentage of revenue basis. The third quarter included several non-recurring expenses related to administrative restructuring and previous acquisitions.
Selected Financial Information
(amounts expressed are in US dollars)
Non-IFRS Financial Measures
Agility Health's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). The Company also uses certain non-IFRS measures, such as EBITDA and Adjusted EBITDA to measure its financial performance. EBITDA is defined by the Company as the addition of net loss, depreciation and amortization and financial expenses. Adjusted EBITDA is defined as EBITDA before acquisition expenses, certain legal expenses and provision adjustments, public listing expense, public transaction expenses, contingent consideration expenses, fair value adjustments on warrants and obligations, share-based compensation expense, gain on extinguishment of liability, contract termination fees (non-recurring revenue) and any restructuring expenses. The Company uses Adjusted EBITDA for the purpose of evaluating the quality of historical and prospective financial and operational performance. Management believes that Adjusted EBITDA is a useful measure for evaluating the performance of the Company. Adjusted EBITDA as well as EBITDA, are not recognized measures under IFRS and do not have standardized meaning prescribed by IFRS and may not be comparable to similarly titled financial metrics reported by other companies.
About Agility Health
Through its subsidiary and principal operating entity, Agility Health, LLC, Agility Health operates a multi-state network of outpatient rehabilitation clinics and provides contracted services to hospitals, nursing homes and other institutional clients, providing care and treatment for orthopedic-related disorders, sports-related injuries, preventative care, rehabilitation of injured workers, and a variety of other injuries and conditions. In addition, Agility Health provides a number of ancillary services related to physical rehabilitation, including practice management software systems and custom orthotics. As of November 28, 2014, Agility Health operates 74 outpatient or onsite rehabilitation locations in 17 states. Agility Health's contract therapy services business provides rehabilitative services to 42 hospitals and inpatient rehabilitation units, 35 nursing homes, long-term care facilities and other service locations in 9 states. For more information, please visit investors.agilityhealth.com.
Forward-Looking Information
This press release contains forward-looking statements regarding Agility Health and its business. Such statements are based on the current expectations and views of future events of Agility Health's management. In some cases the forward-looking statements can be identified by words or phrases such as "may", "will", "expect", "plan", "anticipate", "intend", "potential", "estimate", "believe" or the negative of these terms, or other similar expressions intended to identify forward-looking statements. The forward-looking events and circumstances discussed in this release, including the anticipated future growth of Agility Health, may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company. No forward-looking statement can be guaranteed. Forward-looking statements and information by their nature are based on assumption and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Agility Health undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future events, or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
During the first three quarters of 2014, the Company focused its efforts on improving its operational performance, strengthening its management team, realigning its administrative cost, continuing internal software development as well as discontinuing certain operations.
Financial and Operating Highlights for the Third Quarter ended September 30, 2014 and Year-to-Date
(All comparative figures are for the corresponding period of the prior year)
- Revenue from continuing operations for the third quarter grew 14% to $15.5 million compared to $13.5 million for the same period last year;
- Adjusted EBITDA from continuing operations for the third quarter grew to $0.5 million compared to $0.2 million for the same period last year;
- Gross margin from operations for the third quarter grew to 22% compared to 19% for the same period last year;
- Revenue from continuing operations for the year-to-date grew 2% to $47 million compared to $45 million for the same period last year;
- Adjusted EBITDA from continuing operations for the year-to-date were $2 million compared to $2.5 million for the same period last year, this reduction being partly due to significant operational challenges during the first quarter of 2014, including unusually severe weather-related impacts;
- Gross margin from operations for the year-to-date grew to 22% compared to 18% for the same period last year.
Administrative Cost Realignment
During the third quarter of 2014, the Company completed a restructuring of certain administrative functions across each of the operating segments of the Company, as well as corporate administration. The restructuring resulted in the reassignment of certain administrative responsibilities, intended to increase leverage of existing administrative personnel. The Company expects that the administrative restructuring will result, beginning in the fourth quarter of 2014, in the reduction of approximately $1 million in annual salaries and benefits within selling, general and administrative expenses. At September 30, 2014, the Company had accrued and expensed $250,000 of severance expenses related to the administrative cost realignment.
Discontinued Operations
The third quarter of 2014, included a decision by the Company to discontinue operations at its subsidiary located in the greater Boston, Massachusetts area. The discontinued operations contributed a net loss of $2.8 million or $0.04 per share, for the year ended December 31, 2013 and has contributed a net loss of $1.1 million, or $0.01 per share, for the nine month period ended September 30, 2014.
The Company has initiated measures during the third quarter to ensure that overall selling, general and administrative (SG&A) costs return to historical levels on a percentage of revenue basis. The third quarter included several non-recurring expenses related to administrative restructuring and previous acquisitions.
Selected Financial Information
(amounts expressed are in US dollars)
(in $000's, except for per share amounts and as otherwise indicated) |
Three months ended September 30 | Nine months ended September 30 | |||
| 2014 | 2013 | 2014 | 2013 | ||
| Revenues | $15,541 | $13,582 | $46,692 | $45,414 | |
| Gross Margin | $3,444 | $2,534 | $10,375 | $8,027 | |
| (as % of revenues) | 22.1% | 18.6% | 22.2% | 17.6% | |
| Selling, general and administrative | $3,786 | $2,455 | $10,163 | $7,417 | |
| (as % of revenues) | 24.3% | 18.0% | 21.7% | 16.3% | |
| Loss from continuing operations | $(1,363) | $(904) | $(3,071) | $(2,217) | |
| (as % of revenues) | (8.7%) | (6.6%) | (6.5%) | (4.8%) | |
| Net loss | $(2,303) | $(1,226) | $(4,214) | $(3,960) | |
| Adjusted EBITDA | |||||
| Continuing operations | $515 | $182 | $2,029 | $2,494 | |
| (as % of revenues) | 3.3% | 1.3% | 4.3% | 5.4% | |
| Basic and Diluted earnings per share | |||||
| From continuing operations | $(0.02) | $(0.01) | $(0.05) | $(0.03) | |
| From discontinued operations | $(0.01) | $(0.01) | $(0.01) | $(0.03) | |
| From net loss | $(0.03) | $(0.02) | $(0.06) | $(0.06) | |
Agility Health's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). The Company also uses certain non-IFRS measures, such as EBITDA and Adjusted EBITDA to measure its financial performance. EBITDA is defined by the Company as the addition of net loss, depreciation and amortization and financial expenses. Adjusted EBITDA is defined as EBITDA before acquisition expenses, certain legal expenses and provision adjustments, public listing expense, public transaction expenses, contingent consideration expenses, fair value adjustments on warrants and obligations, share-based compensation expense, gain on extinguishment of liability, contract termination fees (non-recurring revenue) and any restructuring expenses. The Company uses Adjusted EBITDA for the purpose of evaluating the quality of historical and prospective financial and operational performance. Management believes that Adjusted EBITDA is a useful measure for evaluating the performance of the Company. Adjusted EBITDA as well as EBITDA, are not recognized measures under IFRS and do not have standardized meaning prescribed by IFRS and may not be comparable to similarly titled financial metrics reported by other companies.
About Agility Health
Through its subsidiary and principal operating entity, Agility Health, LLC, Agility Health operates a multi-state network of outpatient rehabilitation clinics and provides contracted services to hospitals, nursing homes and other institutional clients, providing care and treatment for orthopedic-related disorders, sports-related injuries, preventative care, rehabilitation of injured workers, and a variety of other injuries and conditions. In addition, Agility Health provides a number of ancillary services related to physical rehabilitation, including practice management software systems and custom orthotics. As of November 28, 2014, Agility Health operates 74 outpatient or onsite rehabilitation locations in 17 states. Agility Health's contract therapy services business provides rehabilitative services to 42 hospitals and inpatient rehabilitation units, 35 nursing homes, long-term care facilities and other service locations in 9 states. For more information, please visit investors.agilityhealth.com.
Forward-Looking Information
This press release contains forward-looking statements regarding Agility Health and its business. Such statements are based on the current expectations and views of future events of Agility Health's management. In some cases the forward-looking statements can be identified by words or phrases such as "may", "will", "expect", "plan", "anticipate", "intend", "potential", "estimate", "believe" or the negative of these terms, or other similar expressions intended to identify forward-looking statements. The forward-looking events and circumstances discussed in this release, including the anticipated future growth of Agility Health, may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company. No forward-looking statement can be guaranteed. Forward-looking statements and information by their nature are based on assumption and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Agility Health undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future events, or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contact Information
Steven N. Davidson
Chairman and Chief Executive Officer
(616) 356-5000
steve.davidson@agilityhealth.com
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