Market Overview

Assure Holdings Reports Second Quarter 2018 Financial Results

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– Revenue Increases by 46% to $6.0 Million, Net Income Increases to $3.3 Million –

– Management to Discuss Second Quarter Results via Conference Call on Thursday, August 30, 2018, at 11:00 A.M. Eastern Time –

DENVER, Aug. 29, 2018 (GLOBE NEWSWIRE) -- Assure Holdings Corp. (the "Company" or "Assure") (TSXV:IOM, OTCQB:ARHH), a provider of intraoperative neuromonitoring services, reported financial results for the three and six months ended June 30, 2018, and revised results for the three and six months ended June 30, 2017.

Second Quarter 2018 Financial Highlights vs. Revised Second Quarter 2017

  • Total revenue grew 46% to $6.0 million versus a revised $4.1 million.
  • Managed cases increased 97% to 677 versus 344.
  • Gross margin was 82.1% versus a revised 82.3%.
  • Earnings from equity method of investment in Physician Network Entities (PNEs) grew 18% to $0.7 million from a revised $0.6 million.
  • Net income increased to $3.3 million compared to a revised $0.2 million. Revised net income in 2017 was not burdened by tax expense as the Company modified its tax provision methodology at the end of 2017.
  • Diluted earnings per share was $0.07 compared to a revised $0.01 per share. The 2018 number reflects the full impact of the shares issued in conjunction with the Company's reverse take-over transaction to become a public company on the TSXV and the performance shares.
  • Adjusted EBITDA grew 50% to $4.2 million versus a revised $2.8 million.

Six Months Ended June 2018 Financial Highlights vs. Revised Same Period in 2017

  • Total revenue grew 63% to $11.7 million versus a revised $7.2 million.
  • Gross margin increased 80 basis points to 82.8% versus a revised 82.0%.
  • Net income increased 42% to $6.2 million, or $0.14 per diluted share, compared to a revised $2.5 million, or $0.08 per diluted share.
  • Adjusted EBITDA grew 64% to $8.4 million versus a revised $5.2 million.

Management Commentary

"During the second quarter, we continued to experience strong results driven by a 97% increase in managed case volume," said John A. Farlinger, Assure's Executive Chairman and Interim CEO. "This was due to strong growth in our new markets of Louisiana and Texas, while continuing to grow organically in Colorado. Looking to the second half of 2018, we remain well positioned to further penetrate new and existing markets with our unique neuromonitoring platform."

Second Quarter 2018 Financial Results

Total revenue increased 46% to $6.0 million compared to a revised $4.1 million in the second quarter of 2017. The significant improvement was due to the continued increase in cases generated from the Company's existing surgeon network, the onboarding of additional surgeons, and the continued expansion in new states. In fact, revenue generated outside Colorado was 35% of total revenue in the second quarter of 2018. Managed cases increased 97% to 677 versus 344 in the second quarter of 2017, primarily driven by the expansion into Louisiana, Texas and Utah.

Gross margin was 82.1% compared to a revised 82.3% in the same quarter last year as the fundamentals of the business sustained the strong revenue growth.

Total operating expenses increased to $1.4 million compared to $1.2 million in the same quarter in 2017 due to expenses associated with growing the business, costs of being a public company and one-time legal expenses related to the Company's 2018 forensic audit.

Net income increased to $3.3 million or $0.07 per diluted share, compared to net income of $0.2 million or $0.01 per diluted share in the second quarter of 2017. The 2018 per diluted share amount reflects 6.0 million of incremental diluted shares relating to performance shares.

Adjusted EBITDA increased 50% to $4.2 million compared to $2.8 million in the same quarter in 2017 due to the continued increase in cases managed, resulting in improved revenue and earnings from the equity method of investment in Assure's PNEs.

Six Months Ended June 2018 Financial Results

Total revenue in the first six months of 2018 increased 63% to $11.7 million compared to $7.2 million in the same period in 2017. The increase was primarily driven by the increase in cases managed resulting from the growing number of relationships in Colorado and the continued expansion into new states.

Gross margin increased 80 basis points to 82.8% compared to 82.0% in the year-ago period. The increase was due to the strong year-over-year growth in revenue.

Total operating expenses in the first six months increased to $3.1 million compared to $1.8 million in the year-ago period. The increase was attributed to costs associated with multi-state expansion initiatives and the ongoing corporate expenses of becoming a public company.

Net income in the first six months of 2018 was $6.2 million or $0.14 per diluted share, compared to $2.5 million or $0.08 per diluted share in the year-ago period. The 2018 per diluted share amount reflects 6.0 million of incremental diluted shares relating to performance shares.

Adjusted EBITDA increased 64% to $8.4 million compared to $5.2 million in the first six months of 2017.

Collected $3.5 million of cash from accounts receivable compared to $1.6 million in the prior year period. Cash distributions from PNE entities totaled $0.5 million in the six months ended June 30, 2018, compared to $0.1 million in the same prior year period. Total cash inflows from collections and distributions increased 252% year over year.  

Assure has also filed its unaudited condensed interim financial statements and management discussion & analysis (MD&A) with SEDAR. This information can be found at www.sedar.com.

Conference Call

The Company will hold a conference call Thursday, August 30, 2018, at 11:00 a.m. Eastern time to discuss its second quarter 2018 results.

Date: Thursday, August 30, 2018
Time: 11:00 a.m. Eastern time
Toll-free dial-in number: 1-877-407-0792
International dial-in number: 1-201-689-8263
Conference ID: 13683006

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 1-949-574-3860.

The conference call will be broadcast live and available for replay here.

A replay of the conference call will be available after 2:00 p.m. Eastern time on the same day through September 13, 2018.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 13683006

About Assure Holdings

Assure Holdings Corp. is a Colorado-based company that works with neurosurgeons and orthopedic spine surgeons to provide a turnkey suite of services that support intraoperative neuromonitoring activities during invasive surgeries. Assure employs its own staff of technologists and uses its own state-of-the-art monitoring equipment, handles 100% of intraoperative neuromonitoring scheduling and setup, and bills for all technical services provided. While Assure focuses primarily on supporting spinal and vascular surgeries, plans are in place to support other classes of medicine that rely on the standard of care that intraoperative neuromonitoring provides. For more information, visit the company's website at assureIOM.com.

Non-IFRS Measures

Adjusted EBITDA is defined as net income/(loss) excluding interest, taxes, depreciation, share-based compensation, performance share compensation, provision for broker warrant fair value, provision for stock option fair value and deemed shares costs related to the reverse takeover merger

Forward-Looking Statements

This news release contains certain statements that may constitute forward-looking information under applicable securities laws. All statements, other than those of historical fact, which address activities, events, outcomes, results, developments, performance or achievements that Assure anticipates or expects may or will occur in the future (in whole or in part) should be considered forward-looking information. Such information may involve, but is not limited to, comments with respect to strategies, expectations, planned operations and future actions of the Company, including but not limited to the Company obtaining regulatory approval to commence trading. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or statements formed in the future tense or indicating that certain actions, events or results "may", "could", "would", "might" or "will" (or other variations of the forgoing) be taken, occur, be achieved, or come to pass. Forward-looking statements in this news release include but are not limited to: Looking to the back half of 2018, we remain well positioned to further penetrate new and existing markets with our unique neuromonitoring platform. Forward-looking information is based on currently available competitive, financial and economic data and operating plans, strategies or beliefs as of the date of this news release, but involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of Assure to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors may be based on information currently available to Assure, including information obtained from third-party industry analysts and other third-party sources, and are based on management's current expectations or beliefs regarding future growth, results of operations, future capital (including the amount, nature and sources of funding thereof) and expenditures. Any and all forward-looking information contained in this press release is expressly qualified by this cautionary statement.

Investors are cautioned that, except as disclosed in the Filing Statement any information released or received with respect to the reverse take-over may not be accurate or complete and should not be relied upon. Trading in the securities of the Corporation should be considered highly speculative.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

The securities of the Corporation have not been and will not be registered under the United States Securities Act of 1933, as amended and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Contact

Cody Slach, Managing Director
Liolios Investor Relations
1-949-574-3860
IOM@Liolios.com


ASSURE HOLDINGS INC.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(in United States Dollars)
 
    June 30, 2018 (unaudited)   December 31, 2017
ASSETS        
Current assets        
Cash   $   440,008   $   215,326  
Accounts receivable, net       24,784,275       16,624,006  
Prepaid expenses       170,983       130,060  
Due from related parties        2,110,911       2,256,117  
  Total current assets       27,506,177       19,225,509  
Equity method investments        3,328,868       2,259,663  
Equipment and furniture, net       481,766       499,123  
  Total assets   $   31,316,811   $   21,984,295  
         
LIABILITIES AND SHAREHOLDERS' EQUITY        
LIABILITIES        
Current liabilities        
Accounts payable and accrued liabilities    $   3,049,346   $   2,504,519  
Current portion of finance leases       230,969       181,787  
Income taxes payable        2,095,460       22,475  
Line of credit        500,000       -   
  Total current liabilities       5,875,775       2,708,781  
Finance leases, net of current portion        317,678       291,063  
Provision for fair value of stock options        214,415       325,515  
Provision for performance share issuance        16,011,500       16,011,500  
Provision for fair value of broker warrants        59,751       128,062  
Deferred tax liability, net        92,276       92,276  
  Total liabilities       22,571,395       19,557,197  
SHAREHOLDERS' EQUITY        
Capital stock        35,555       35,505  
Additional paid-in capital        6,155,742       6,079,115  
Retained earnings/(accumulated deficit)       2,554,119       (3,687,522 )
  Total shareholders' equity       8,745,416       2,427,098  
Total liabilities and shareholders' equity   $   31,316,811   $   21,984,295  
 

 

ASSURE HOLDINGS INC.
CONSOLIDATED STATEMENT OF INCOME
(in United States Dollars)
 
    Three months ended June 30, 2018    Three months ended June 30, 2017 (revised)   Six Months Ended June 30, 2018   Six Months Ended June 30, 2017 (revised)
Revenue                
  Out-of-Network fees   $   5,895,319     $   4,006,183     $   11,484,160     $   6,994,689  
  Contract fees       138,689         112,818         250,999         190,883  
Total revenue       6,034,008         4,119,001         11,735,159         7,185,572  
Cost of revenues       (1,082,926 )       (727,792 )       (2,021,804 )       (1,290,426 )
Gross margin       4,951,082         3,391,209         9,713,355         5,895,146  
Operating expenses                
General and administrative       1,100,392         1,103,892         2,454,541         1,638,519  
Depreciation and amortization       99,494         46,352         186,423         91,910  
Sales and marketing       151,475         83,503         446,630         148,336  
  Total operating expenses       1,351,361         1,233,747         3,087,594         1,878,765  
Income from operations       3,599,721         2,157,462         6,625,761         4,016,381  
Other income/(expenses)                
Earnings from equity method investments       665,599         565,633         1,561,900         995,262  
Provision for broker warrant fair value       -          (930,189 )       68,311         (930,189 )
Provision for stock option fair value       -          (36,589 )       111,100         (36,589 )
Deemed share costs related to RTO       -          (1,551,126 )       -          (1,551,126 )
Interest, net       (26,711 )       (5,586 )       (52,446 )       (21,802 )
  Total other income/(expenses)       638,888         (1,957,857 )       1,688,865         (1,544,444 )
Income before income taxes       4,238,609         199,605         8,314,626         2,471,937  
Income tax expense       961,799         -          2,072,985         -   
Net income   $   3,276,810     $   199,605     $   6,241,641     $   2,471,937  
Basic income per common share    $   0.09     $   0.01     $   0.18     $   0.09  
Fully diluted income per common share    $   0.07     $   0.01     $   0.14     $   0.08  

 

ASSURE HOLDINGS CORP.
ADJUSTED EBITDA
(in United States Dollars)
 
  Three Months Ended June 30, 2018 Three Months Ended June 30, 2017 (revised) Six Months Ended June 30, 2018 Six Months Ended June 30, 2017 (revised)
Reported net income $   3,276,810   $   199,605 $   6,241,641   $   2,471,937
Interest     26,711       5,586     52,446       21,802
Depreciation     99,494       46,352     186,423       91,910
Share based compensation     (126,387 )     50,609     74,177       50,609
Income tax expense     961,799       -      2,072,985       - 
Deemed share costs related to RTO     -        1,551,126     -        1,551,126
Provision for broker warrant fair value     -        930,189     (68,311 )     930,189
Provision for stock option fair value     -        36,589     (111,100 )     36,589
  $   4,238,427   $   2,820,056 $   8,448,261   $   5,154,162

 

ASSURE HOLDINGS CORP.  
EARNINGS PER SHARE  
(in United States Dollars)  
                 
  Three Months Ended June 30, 2018   Three Months Ended June 30, 2017 (revised)   Six Months Ended June 30, 2018   Six Months Ended June 30, 2017 (revised)  
Income attributable to common shareholders                
Basic $ 3,276,810   $ 199,605   $ 6,241,641   $ 2,471,937  
Weighted average common  share outstanding   35,555,105     34,953,213     35,527,571     27,617,716  
Basic earnings per common share $ 0.09   $ 0.01   $ 0.18   $ 0.09  
                 
Income attributable to common shareholders                
Basic $ 3,276,810   $ 199,605   $ 6,241,641   $ 2,471,937  
Weighted average common shares outstanding   35,555,105     34,953,213     35,527,571     27,617,716  
Dilutive effect of stock options, warrants, and performance shares   9,341,000     3,655,364     9,341,000     3,655,364  
Weighted average common shares outstanding assuming dilution   44,896,105     38,608,577     44,868,571     31,273,080  
Fully diluted earnings per common share $ 0.07   $ 0.01   $ 0.14   $ 0.08  


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