Agility Health, Inc.
TSX VENTURE : AHI

Agility Health, Inc.

November 24, 2015 14:58 ET

Agility Health Reports Third Quarter 2015 Financial Results

GRAND RAPIDS, MICHIGAN--(Marketwired - Nov. 24, 2015) - Agility Health, Inc. ("Agility Health" or "the Company") (TSX VENTURE:AHI) today reports its financial results for the three and nine-month period ended September 30, 2015. All amounts are expressed in U.S. dollars unless indicated otherwise.

Financial and Operating Highlights for the Third Quarter and Year-to-Date

(All comparative figures are for the corresponding period of the prior year)

  • Revenue from continuing operations for the third quarter was $15.5 million;
  • Revenue for the first three quarters of 2015 grew to $47.1 million from $46.7 million for the comparable period in 2014;
  • EBITDA from continuing operations for the third quarter grew to $1.4 million or 9% of revenues from $0.2 million and 1% of revenues for the comparable period in 2014;
  • EBITDA from continuing operations for the first three quarters of 2015 grew by 156% to $4.1 million from $1.6 million for the comparable period in 2014;
  • Gross margin from operations for the third quarter was 23%;
  • Net loss for the third quarter declined to $0.2 million or $(0.01) per share compared to a net loss of $2.3 million or $(0.02) per share for the comparable period in 2014; and
  • Net loss for the first three quarters of 2015 declined by $3.1 million to $1.1 million or $(0.02) per share.

"We continue to be pleased with our progress toward our goal of profitability," stated Steve Davidson, Agility Health's Chairman and CEO. "Our third quarter results continue to show positive trending in operational improvement. EBITDA for the third quarter grew by more than 500% compared to the comparable period for the prior year and EBITDA for the first three quarters of the year has grown by more than 150% compared to the comparable period for the prior year. We remain focused on driving improvements in gross margin and managing the overall administrative cost structure of the business. Our goal remains to achieve profitability within the near term combined with growth, through timely strategic acquisitions and 'greenfield' clinic expansions."

Selected Financial Information

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
September 30, 2015 and December 31, 2014
(Expressed in US Dollars)
(Unaudited) (Audited)
September 30, December 31,
2015 2014
ASSETS
Current assets
Cash $ 2,692,397 $ 1,301,084
Accounts and other receivables 7,799,875 7,668,353
Income taxes receivable 115,808 115,808
Prepaid expenses and other current assets 943,034 1,173,300
Total current assets 11,551,114 10,258,545
Investments 86,025 86,025
Property and equipment 1,142,340 1,307,508
Intangible assets 12,488,877 13,024,986
Goodwill 2,682,730 2,682,730
Total assets $ 27,951,086 $ 27,359,794
LIABILITIES AND EQUITY (DEFICIT)
Current liabilities
Accounts payable and accrued liabilities $ 8,560,568 $ 8,122,871
Line of credit 4,750,620 5,060,085
Current portion of long-term debt 305,556 555,555
Current portion of other long-term liabilities 1,140,480 1,413,432
Total current liabilities 14,757,224 15,151,943
Convertible debentures payable 1,099,741 1,114,763
Other long-term liabilities 21,943,793 22,214,537
Total liabilities 37,800,758 38,481,243
Equity (deficit)
Share capital 9,003,145 6,280,665
Contributed surplus 350,039 299,036
Retained deficit (21,357,043 ) (19,382,756 )
(12,003,859 ) (12,803,055 )
Non-controlling interest 2,154,187 1,681,606
Total equity (deficit) (9,849,672 ) (11,121,449 )
Total liabilities and equity (deficit) $ 27,951,086 $ 27,359,794
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
Three months ended September 30, 2015 and 2014
(Expressed in US Dollars)
(Unaudited) (Unaudited)
2015 2014
Revenue $ 15,515,195 $ 15,541,386
Cost of revenues
Salaries and benefits 9,834,394 10,156,678
Contract labor 271,960 192,737
Facility 964,283 932,543
Supplies 218,518 204,481
Depreciation and amortization 173,805 182,082
Provision for bad debts 107,669 80,838
Other 333,933 347,546
Total cost of revenues 11,904,562 12,096,905
Gross margin 3,610,633 3,444,481
Selling, general and administrative 3,046,122 3,786,065
Other income (expense)
Interest expense (1,174,089 ) (1,161,483 )
Interest income - -
Loss on disposal of equipment - (308 )
Foreign currency translation gain (loss) (1,096 ) (19 )
Fair value adjustment on warrants and obligations 430,202 140,000
(744,979 ) (1,021,809 )
Loss from continuing operations before income taxes (180,468 ) (1,363,393 )
Provision for income taxes
Current 14,083 12,055
Deferred - -
14,083 12,055
Net and total comprehensive loss from continuing operations (194,551 ) (1,375,448 )
Discontinued Operations
Net and total comprehensive loss from discontinued operations (18,052 ) (927,829 )
Net and total comprehensive loss $ (212,603 ) $ (2,303,277 )
Net and total comprehensive income (loss) attributable to:
Shareholders $ (485,239 ) $ (2,547,979 )
Non-controlling interest 272,636 244,702
$ (212,603 ) $ (2,303,277 )
Earnings per share
Basic, loss per share (0.01 ) (0.02 )
Diluted, loss per share (0.01 ) (0.02 )
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
Three months ended September 30, 2015 and 2014
(Expressed in US Dollars)
(Unaudited) (Unaudited)
2015 2014
Revenue $ 47,067,546 $ 46,692,445
Cost of revenues
Salaries and benefits 29,999,402 30,538,498
Contract labor 822,618 615,822
Facility 2,910,126 2,505,519
Supplies 602,266 706,629
Depreciation and amortization 526,074 547,095
Provision for bad debts 360,340 344,536
Other 957,980 1,058,569
Total cost of revenues 36,178,806 36,316,668
Gross margin 10,888,740 10,375,777
Selling, general and administrative 8,699,895 10,163,429
Other income (expense)
Interest expense (3,612,872 ) (3,439,949 )
Interest income 14 157
Loss on disposal of equipment - (5,653 )
Foreign currency translation gain (loss) (96 ) 31,644
Fair value adjustment on warrants and obligations 565,294 130,000
(3,0247,660 ) (3,283,801 )
Loss from continuing operations before income taxes (858,815 ) (3,071,453 )
Provision for income taxes
Current 49,631 60,127
Deferred - -
49,631 60,127
Net and total comprehensive loss from continuing operations (908,446 ) (3,131,580 )
Discontinued Operations
Net and total comprehensive loss from discontinued operations (162,260 ) (1,082,991 )
Net and total comprehensive loss $ (1,070,706 ) $ (4,214,571 )
Net and total comprehensive income (loss) attributable to:
Shareholders $ (1,974,287 ) $ (4,833,265 )
Non-controlling interest 903,581 618,694
$ (1,070,706 ) $ (4,214,571 )
Earnings per share
Basic, loss per share (0.02 ) (0.06 )
Diluted, loss per share (0.02 ) (0.06 )

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 September 30, 2015, Agility Health operates 85 outpatient or onsite rehabilitation locations in 14 states.

Agility Health's contract therapy services business provides rehabilitative services to 31 hospitals and inpatient rehabilitation units, 36 nursing homes, long-term care facilities and other service locations in 8 states. For more information, please visit investors.agilityhealth.com.

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, 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.

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", "should" 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.

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