Atc Healthcare (AMEX:AHN)
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ATC Healthcare, Inc. (AMEX:AHN),
a leader in medical staffing, today reported results for its third
quarter of fiscal year end 2007, which ended November 30, 2006.
Three-Month Results
Revenues increased by $4.4 million, or 24%, from $18.2 million for the
third quarter ended November 30, 2005 to $22.6 million for the third
quarter ended November 30, 2006. Service costs represent all direct
costs of providing services to our clients. Service costs were 79.0% of
total revenues in the third quarter ended in 2006 as compared to 75.9 %
for the third quarter ended in 2005. Income from operations decreased by
$124 thousand from $241 thousand for the third quarter ended in 2005 to
$117 thousand for the third quarter ended in 2006. Net loss increased by
$193 thousand from $(269) thousand or $(.01) per basic and diluted share
for the third quarter ended in 2005, to a loss of $(462) thousand or
$(.02) per basic and diluted share for the third quarter ended in 2006.
EBTDAS (“earnings before taxes, depreciation
and amortization and stock-based compensation expense”)
net loss from continuing operations was $200 thousand for the third
quarter ended in 2006 compared to a loss of $114 thousand for the third
quarter ended in 2005. For an explanation of the non-GAAP measure
"EBTDAS from continuing operations" and of the importance of that term
for our business, please see the discussion under "Earnings Measurement
Quality" below. EBTDAS from continuing operations is compared to the
GAAP measure "net (loss) from continuing operations" in the
reconciliation at the end of this release.
Nine-Month Results
Revenues increased by $12.3 million, or 23%, from $53.2 million for the
nine months ended November 30, 2005 to $65.6 million for the nine months
ended November 30, 2006. Service costs were 78.4% of total revenues in
the nine months ended in 2006 as compared to 76.5% for the nine months
ended in 2005. Income from operations increased by $391 thousand from
$210 thousand for the nine months ended in 2005 to income of $601
thousand for the nine months ended in 2006. Net loss improved by
decreasing $1.2 million from a net loss of $(2.2) million (including a
loss from discontinued operations of $(577) thousand) for the nine
months ended in 2005, to a net loss of $(943) thousand in the nine
months ended in 2006. Basic and diluted loss per share was $(.08) for
the nine months ended in 2005 and basic and diluted loss per share was
$(.04) for the nine months ended in 2006.
EBTDAS from continuing operations was a loss of $211 thousand for the
nine months ended in 2006 compared to a loss of $1.1 million for the
nine months ended in 2005.
Management Comments
“Continued revenue growth of 24% and 23%,
respectively, in the three and nine months ended in 2006 compared to
2005, is very positive,” remarked David
Savitsky, Chief Executive Officer. “As
anticipated, our acquisition of Critical Nursing Solutions in early June
has contributed nicely to these revenue increases. Equally exciting is
that our existing offices have shown significant organic growth as well,
and in certain sun-belt territories we expect very strong performance
this winter,” added Savitsky. "As we continue
to grow revenues, and improve margins, we look forward to ATC attaining
profitability."
ATC Third Quarter Earnings Call
In conjunction with this release, management will host a conference call
to discuss the earnings release at 1:00 PM EST, on Wednesday, January
17, 2007. To listen to the call, participants in the US and Canada
should dial: (800) 946-0720, five minutes prior to the start time of the
call. The access code is 5707145. A telephonic replay of the call
may be accessed by dialing (888) 203-1112 and entering access code
5707145. The replay will be available from 3:30 PM EST, on January 17,
2007 until midnight, Central Standard Time, January 19, 2007. This
release, along with any additional financial or statistical information
to be presented on the call, will be archived on the Corporate Press
Releases section of our website, www.atchealthcare.com
Forward Looking Statements
Certain statements contained in this release that are not statements of
historical facts are “forward-looking
statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. The words —
“believe”, “expect”,
“anticipate”, “intend”,
“will”, and
similar expressions are examples of words that identify forward-looking
statements. Forward-looking statements include, without limitation,
statements regarding our future financial position, timing of future
revenue, business strategy and cost savings. These forward-looking
statements are based on our current beliefs, as well as assumptions we
have made based upon information currently available to us. These
forward-looking statements may be affected by the risks and
uncertainties in our business and are qualified in their entirety by the
cautionary statements and risk factor disclosure contained in our
filings with the Securities and Exchange Commission, including our
annual report on Form 10-K for the year ended February 28, 2006. We do
not assume, and expressly disclaim, any obligation to update these
forward-looking statements.
Earnings Measurement Quality - GAAP vs. Non-GAAP
The company provides supplemental information regarding its operational
performance using certain non-GAAP financial measures, which excludes
primarily non-cash charges. The company uses “EBTDAS
from continuing operations” to provide an
indication of the company’s baseline
performance before charges that are considered by management to be
outside of the company’s core operating
results. EBTDAS represents earnings from continuing operations less
taxes, depreciation and amortization and stock-based compensation
expense. The company believes this non-GAAP financial measure provides a
good measure of performance for the company because it represents the
amount realized from revenue after all operating expenses. While
non-GAAP financial measures are not an alternative to generally accepted
accounting principles used in the United States (“GAAP”),
the company’s management uses this non-GAAP
financial measure to evaluate the company’s
historical and prospective financial performance in the ordinary course
of business. The company believes that providing to the company’s
investors the non-GAAP financial measure, in addition to the most
comparable GAAP presentation, allows the investors to better evaluate
the company’s progress and its financial
results over time and to compare the company’s
results with the results of the company’s
competitors.
About ATC Healthcare, Inc.
ATC is a national leader in medical staffing personnel to hospitals,
nursing homes, clinics and other healthcare facilities with 56 locations
in 35 states. ATC provides supplemental staffing, outsourcing and human
resource solutions to hospitals, nursing homes, medical and research
facilities and industry. Drawing from a pool of over 15,000 healthcare
professionals spanning more than 50 specialties, the company supplies
both clinical and non-clinical personnel for short-term, long-term, and “traveling”
contract assignments. To learn more about the company’s
services, visit their website at www.atchealthcare.com.
ATC HEALTHCARE, INC. AND SUBSIDIARIESCONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)(In
thousands, except per share data)
For the ThreeMonths Ended
For the NineMonths Ended
November 30,2006
November 30,2005
November 30,2006
November 30,2005
REVENUES:
Service revenues
$22,627
$18,223
$65,545
$53,241
COSTS AND EXPENSES:
Service Costs
17,874
13,824
51,400
40,735
General and administrative expenses (including $112 and $304 of
stock compensation expense for the three and nine month periods,
respectively, ended in 2006)
4,511
4,003
13,169
11,856
Depreciation and amortization
125
155
375
440
Total operating expenses
22,510
17,982
64,944
53,031
INCOME FROM OPERATIONS
117
241
601
210
INTEREST AND OTHER EXPENSE (INCOME):
Interest expense, net
549
512
1,531
1,753
Other (income) expense, net
5
(2)
(40)
(13)
Total interest and other (income) expense
554
510
1,491
1,740
LOSS BEFORE INCOME TAXES
(437)
(269)
(890)
(1,530)
INCOME TAX PROVISION
25
-
53
50
NET LOSS FROM CONTINUING OPERATIONS
(462)
(269)
(943)
(1,580)
LOSS FROM DISCONTINUED OPERATIONS
-
-
-
(577)
NET LOSS
(462)
(269)
(943)
(2,157)
Dividends accreted to Preferred Stockholders
134
120
507
154
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS
$ (596)
$ (389)
$ (1,450)
$ (2,311)
(LOSS) PER SHARE:
(LOSS) FROM CONTINUING OPERATIONS:
(LOSS) PER COMMON SHARE - BASIC
$ (.02)
$ (.01)
$ (.04)
$ (.06)
(LOSS) PER COMMON SHARE - DILUTED
$ (.02)
$ (.01)
$ (.04)
$ (.06)
(LOSS) FROM DISCONTINUED OPERATIONS:
(LOSS) PER COMMON SHARE - BASIC
$ -
$ -
$ -
$ (.02)
(LOSS) PER COMMON SHARE - DILUTED
$ -
$ -
$ -
$ (.02)
NET LOSS:
(LOSS) PER COMMON SHARE - BASIC
$ (.02)
$ (.01)
$ (.04)
$ (.08)
(LOSS) PER COMMON SHARE - DILUTED
$ (.02)
$ (.01)
$ (.04)
$ (.08)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic
39,663
33,930
38,993
30,338
Diluted
39,663
33,930
38,993
30,338
See notes to condensed consolidated financial statements
ATC HEALTHCARE, INC. AND SUBSIDIARIES
RECONCILIATION OF UNAUDITED LOSS FROM CONTINUING OPERATIONS TO
EBTDAS FROM CONTINUING OPERATIONS (In thousands)
For the Three Months
Ended
For the Nine Months
Ended
November 30,2006
November 30,2005
November 30,2006
November 30,2005
NET LOSS FROM CONTINUING OPERATIONS
$ (462)
$ (269)
$ (943)
$(1,580)
Add back:
Income taxes
25
-
53
50
Depreciation and amortization
125
155
375
440
Stock-based compensation expense
112
-
304
-
EBTDAS FROM CONTINUING OPERATIONS
$(200)
$(114)
$(211)
$(1,090)