First Choice Healthcare Solutions Reports First Quarter 2017 Results

MELBOURNE, FL--(Marketwired - May 16, 2017) - First Choice Healthcare Solutions, Inc. (OTCQB: FCHS) ("FCHS," "First Choice" or the "Company"), one of the nation's only non-physician-owned, publicly traded healthcare services companies focused on the delivery of total musculoskeletal solutions with an emphasis on Orthopaedics and Spine care, today announced its financial results for the three months ended March 31, 2017.

Financial and operational highlights for the comparable three months ended March 31, 2017 and 2016, respectively:

• Total revenues increased 7% to a record $7,720,353 from $7,241,753
  
  
• Record net patient service revenue rose 8% to $7,141,990 from $6,615,141
  
  
• Non-GAAP adjusted EBITDA*, totaled $752,401 compared to $963,359 for the same period in 2016 after deducting certain non-cash and one-time cash gains and expenses and net of the impact from sale of Marina Towers property
  
  
• Workforce increased from 116 to 166 year-over-year as we expanded our operational footprint
  
  
• Net income attributable to First Choice totaled $202,519, or $0.01 per share, compared to $9,566,941, or $0.42 per share (2016 reflects a gain on the sale of Marina Towers property of $9,188,968)
  
  
• As of March 31, 2017, cash and cash equivalents totaled $3,901,489 compared to $4,593,638 at December 31, 2016
  
  

"We were very pleased with our operational execution during the quarter as we continue laying the foundation that will drive shareholder value creation going forward. While our financial results during the quarter were impacted on a comparative basis by the sale of property and start-up related expenses, key metrics central to our success, such as Average Patient Value (APV), continue to trend higher," stated Chris Romandetti, President and CEO of First Choice. "We continue to build out our service platform aggressively, opening two new physical therapy locations this month with two additional sites coming online later this year. Our recently opened locations are now maturing their patient schedules and quickly booking out, validating the strong customer demand we had anticipated and highlighting the potential of this business model."

Details for Conference Call and Webcast
First Choice's management team will host a conference call and webcast for the investment community beginning at 11:00 AM Eastern Time on Tuesday, May 16th to discuss the results and recent corporate developments. Participants can register and access the conference call by dialing toll-free 866-682-6100 (for U.S. and Canada dial-in) or 862-255-5401 (for international dial-in). The conference call will also be webcasted, which can be accessed through First Choice's investor relations website by navigating to http://ir.myfchs.com/ and clicking on "First Quarter 2017 Conference Call and Webcast." Participants will be required to register to access the call. For those who cannot listen to the live broadcast, a replay will be available shortly after the call on the investor relations page of First Choice's website, found at http://ir.myfchs.com/.

* Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with GAAP, we use non-GAAP Adjusted EBITDA. In this press release, we provide Adjusted EBITDA, a non-GAAP financial measure that represents our net income (loss) adjusted to exclude: interest, net; provision (benefit) for income taxes; depreciation and amortization; stock-based compensation expense; and gain on sale of a property and improvements. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use this non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of our recurring core business operating results. We believe that both management and investors benefit from referring to this non-GAAP financial measure in assessing our performance and when planning, forecasting, and analyzing future periods. This non-GAAP financial measure also facilitates management's internal comparisons to our historical performance and liquidity. We believe this non-GAAP financial measure is useful to investors both because they allow for greater transparency with respect to a key metric used by management in its financial and operational decision-making. For more information on this non-GAAP financial measure, please see the table captioned "Reconciliation of non-GAAP Adjusted EBITDA Performance." For additional details relating to First Choice's 1^st quarter results, please refer to the Quarterly Report Form 10-Q filed yesterday with the U.S. Securities and Exchange Commission and found at www.sec.gov.

FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
			March 31,				December 31,
			2017				2016
			(unaudited)
ASSETS
Current assets:
Cash and cash equivalents (amounts related to VIE of $908,141 and $708,858)			$	3,901,489			$	4,593,638
Accounts receivable, net (amounts related to VIE of $6,112,966 and $6,010,961)				10,390,140				9,536,830
Employee loans (amounts related to VIE of $491,550 and $491,850)				953,132				820,341
Prepaid and other current assets (amounts related to VIE of $392,961 and $329,427)				651,770				422,512
	Total current assets			15,896,531				15,373,321
Property, plant and equipment, net of accumulated depreciation of $1,264,271 and $1,165,219 (amounts related to VIE of $678,018 and $693,629)				2,619,493				2,544,816
Other assets (amounts related to VIE of $921,470)				4,137,521				4,227,957
Total assets			$	22,653,545			$	22,146,094
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued expenses (amounts related to VIE of $1,638,148 and $1,366,143)			$	2,437,080			$	2,083,231
Accounts payable, related party (amount related to VIE of $251,588)				251,588				251,588
AMT tax payable				181,029				181,029
Line of credit, short term (amount related to VIE of $439,524)				1,539,524				1,539,524
Notes payable, current portion				402,372				519,452
Unearned revenue				43,854				26,936
Deferred rent, short term portion (amount related to VIE of $237,923)				237,923				237,923
	Total current liabilities			5,093,370				4,839,683
Long term debt:
Deposits held				41,930				41,930
Notes payable, long term portion				23,599				14,531
Deferred rent, long term portion (amount related to VIE of $2,240,552 and $2,214,909)				2,345,465				2,293,594
	Total long term debt			2,410,994				2,350,055
Total liabilities				7,504,364				7,189,738
Equity:
Preferred stock, $0.01 par value; 1,000,000 shares authorized, Nil issued and outstanding				-				-
Common stock, $0.001 par value; 100,000,000 shares authorized, 26,803,994 and 24,631,327 shares issued and outstanding as of March 31, 2017 and December 31, 2016, respectively				26,804				24,631
Additional paid in capital				24,081,761				24,020,610
Accumulated deficit				(9,898,015	)			(10,100,534	)
Total stockholders' equity attributable to First Choice Healthcare Solutions, Inc.				14,210,550				13,944,707
Non-controlling interest (note 10)				938,631				1,011,649
	Total equity			15,149,181				14,956,356
Total liabilities and equity			$	22,653,545			$	22,146,094

FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
			For the Three months ended March 31,
			2017				2016
Revenues:
Patient service revenue			$	7,406,986			$	6,877,665
Allowance for bad debts				(264,996	)			(262,524	)
Net patient service revenue less allowance for bad debts				7,141,990				6,615,141
Rental revenue				578,363				626,612
	Total revenue			7,720,353				7,241,753
Operating expenses:
Salaries and benefits				3,354,376				2,780,569
Other operating expenses				2,529,183				2,045,575
General and administrative				1,535,833				1,547,576
Depreciation and amortization				189,488				298,950
	Total operating expenses			7,608,880				6,672,670
Net income from operations				111,473				569,083
Other income (expense):
Gain on sale of property and improvements				-				9,188,968
Miscellaneous income (expense)				50,102				58,857
Amortization financing costs				-				(15,325	)
Interest expense				(32,074	)			(181,135	)
	Total other income			18,028				9,051,365
Net income before provision for income taxes				129,501				9,620,448
Income taxes (benefit)				-				-
Net income				129,501				9,620,448
Non-controlling interest				73,018				(53,507	)
NET INCOME ATTRIBUTABLE TO FIRST CHOICE HEALTHCARE SOLUTIONS, INC.			$	202,519			$	9,566,941
Net income per common share, basic			$	0.01			$	0.42
Net income per common share, diluted			$	0.01			$	0.37
Weighted average number of common shares outstanding, basic				26,252,505				22,886,307
Weighted average number of common shares outstanding, diluted				27,052,505				25,552,974

FIRST CHOICE HEALTHCARE SOLUTIONS, INC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
			For the Three months ended March 31,
			2017				2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income			$	129,501			$	9,620,448
Adjustments to reconcile net income to cash (used in) provided by operating activities:
Depreciation and amortization				189,488				298,950
Amortization of financing costs				-				15,325
Bad debt expense				264,996				262,524
Gain on sale of property				-				(9,188,968	)
Common stock issued in connection with loan extension				-				92,000
Stock based compensation				63,324				81,300
Changes in operating assets and liabilities:
Accounts receivable				(1,118,306	)			(1,087,059	)
Prepaid expenses and other current assets				(229,258	)			91,623
Restricted funds				-				359,414
Employee loans				(132,791	)			(245,933	)
Accounts payable and accrued expenses				353,849				122,628
Settlement payable				-				(150,000	)
Deposits				-				(14,432	)
Deferred rent				51,871				59,404
Unearned income				16,918				-
	Net cash (used in) provided by operating activities			(410,408	)			317,224
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property				-				15,068,497
Purchase of equipment				(173,729	)			(126,073	)
	Net cash (used in) provided by investing activities			(173,729	)			14,942,424
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from advances				-				90,714
Proceeds from notes payable				22,113				-
Proceeds from line of credit				-				372,636
Payments on notes payable				(130,125	)			(7,265,997	)
	Net cash used in financing activities			(108,012	)			(6,802,647	)
Net (decrease) increase in cash and cash equivalents				(692,149	)			8,457,001
Cash and cash equivalents, beginning of period				4,593,638				1,594,998
Cash and cash equivalents, end of period			$	3,901,489			$	10,051,999
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for interest			$	32,328			$	181,135
Cash paid during the period for taxes			$	-			$	-

FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
RECONCILIATION OF NON-GAAP ADJUSTED EBITDA PERFORMANCE
		For the Three Months Ended March 31,
		2017				2016				Difference
										Marina Towers Sale
										Subtract
Net income attributable to First Choice Healthcare Solutions		$	202,519			$	9,566,941
Amortization			.				15,325			(15,325	)
Bad Debt			264,996				262,524
Depreciation			189,488				298,950			(109,462	)
Interest			32,074				181,135			(129,061	)
Taxes			-				-
Stock-based compensation			63,324				81,300
Gain on sale of property and equipment							(9,188,968	)
Adjusted EBITDA		$	752,401			$	1,217,207			(253,848	)		$	963,359
Net Patient Service Revenue Less 60% non-controlling revenue ($714,255 and 762,785 respectively)		$	6,427,735			$	5,852,356
Adjusted EBITDA as a % of Net Patient Service Revenue Less 60% non-controlling revenue)			12	%										16	%

About First Choice Healthcare Solutions, Inc.
Headquartered in Melbourne, Florida, First Choice Healthcare Solutions (FCHS) is implementing a defined growth strategy aimed at expanding its network of non-physician-owned medical centers of excellence, which concentrate on treating patients in the following specialties: Orthopaedics, Spine Surgery, Neurology, Interventional Pain Management and related diagnostic and ancillary services in key expansion markets throughout the Southeastern U.S. Serving Florida's Space Coast, the Company's flagship integrated platform currently administers over 100,000 patient visits each year and is comprised of First Choice Medical Group, The B.A.C.K. Center and Crane Creek Surgery Center. For more information, please visit www.myfchs.com, www.myfcmg.com, www.thebackcenter.net and www.cranecreeksurgerycenter.com.

Safe Harbor Statement
Certain information set forth in this news announcement may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of First Choice Healthcare Solutions, Inc. Such forward-looking statements are based on current expectations, estimates and projections about the Company's industry, management beliefs and certain assumptions made by its management. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Information concerning factors that could cause the Company's actual results to differ materially from those contained in these forward-looking statements can be found in the Company's periodic reports on Form 10-K and Form 10-Q, and in its Current Reports on Form 8-K, filed with the Securities and Exchange Commission. Unless required by law, the Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise to reflect future events or circumstances or reflect the occurrence of unanticipated events.