HOUSTON, TX -- (Marketwired) -- 11/13/13 -- Northstar Healthcare Inc. (TSX: NHC) today announced its financial results for the three and nine months ended September 30, 2013. All dollar amounts are in United States currency unless otherwise stated; percentage calculations are based on the numbers in the financial statements and may not correspond to rounded figures presented in this release.
Detailed information relating to the three and nine months ended September 30, 2013 is available in Management's Discussion and Analysis (MD&A) and Interim Consolidated Financial Statements, which are available on the company's web site at: www.northstar-healthcare.com and at www.sedar.com. This information is not intended to provide a comprehensive comparison of financial results.
"Northstar has reached an inflection point in generating revenues and our share price has reflected improved valuation," stated Dr. Donald Kramer, Northstar Healthcare's CEO. "Most of the business development in the past year was to devise programs to attract large numbers of physicians and patients to our centers. With those programs now solidly in place we can focus on driving sales and building scale. We are keenly aware of some great opportunities that could drive large revenues across our platform and we now have the systems to allow us to expand our sites of service. We have strategies which will allow us to mitigate risk as we grow our platform."
We commenced our planned bariatric program in Dallas with a prominent physician group," said Dr. Kenneth Efird, Chief Business Development Officer. "The newly recruited physician group started scheduling and performing cases towards the end of the quarter and had an immediate material impact on our financial performance. Due to the length of the marketing cycle, the results of the marketing spend had no material impact on revenues during the third quarter, but should impact the last quarter of 2013 and first quarter of 2014."
Third Quarter Results
Net patient service revenues for the three months ended September 30, 2013 totaled $7.6 million, an increase of $1.6 million or 25.8%, compared to $6.1 million for the same period in 2012. The increase in net patient service revenues was primarily due to a 21.6% increase in case volume. The increase in case volume was mainly due to cases derived from Northstar's marketing campaigns and Northstar commencing its planned bariatric program in Dallas.
The Company recorded net loss of $0.3 million compared to net income of $0.9 million in the prior corresponding period. This change is primarily related to increased marketing spend in salaries and advertising as the Company is committing more resources to direct to consumer marketing. This resulted in net loss per weighted average share of $0.01.
For the three months ended September 30, 2013 the Company had cash flows provided by operations of $2.0 million, representing a $0.3 million increase compared to the prior corresponding period. Management's efforts in managing the revenue cycle provided significant positive results in collections.
For the three months ended September 30, 2013, the Company used $1.0 million in cash flows for investing activities compared to $.01 million used in the prior corresponding period. This change is primarily related to the purchase of all outstanding ownership from all physician limited partners of MSID in August 2013.
For the three months ended September 30, 2013, the Company used $1.2 million in cash flows for financing activities compared to $0.9 million used in the prior corresponding period. Due to positive cash flow positions, the Company was able to make significant distributions to non-controlling interests.
Nine Months Results
Net patient service revenues for the nine months ended September 30, 2013 totaled $17.6 million, an increase of $3.2 million or 22.2%, compared to $14.4 million for the same period in 2012. The increase in net patient service revenues was primarily due to a 16.9% increase in case volume. The increase in case volume was due to Northstar resyndicating the center in Dallas and adding a large pain and spine physician group in the 2nd half of 2012. Case volume also increased from cases derived from Northstar's marketing campaigns and Northstar commencing its planned bariatric program in Dallas.
The Company recorded net loss of $1.6 million compared to net income of $0.8 million in the prior corresponding period. This change is primarily related to increased marketing spend in salaries and advertising as the Company is committing more resources to direct to consumer marketing. This resulted in net loss per weighted average share of $0.04.
The Company had cash flows provided by operations of $3.5 million, representing a $0.1 million decrease compared to the prior corresponding period, despite higher case volume. The decrease was caused by a decline in net income as a result of increased spending on current marketing campaigns.
For the nine months ended September 30, 2013, the Company used $1.2 million in cash flows for investing activities compared to a nominal amount used in the prior corresponding period. This change is primarily related to the purchase of ownership from all physician limited partners of MSID.
For the nine months ended September 30, 2013, the Company used $3.2 million in cash flows for financing activities compared to $2.0 million used in the prior corresponding period. Due to positive cash flow positions, the Company was able to make significant distributions to non-controlling interests.
At September 30, 2013, Northstar had consolidated working capital of $4.8 million, including cash of $3.3 million. This compares with $7.1 million and $4.2 million, respectively, at year-end 2012. Working capital decreased as Northstar has invested in its marketing campaigns.
Earnings Call
A conference call for the investment community will be held on Thursday, November 14 at 11:00 a.m. (ET). The call-in numbers for participants is (888) 231-8191. A live audio feed of the call will also be available on the internet at:
http://www.newswire.ca/en/webcast/detail/1255975/1384273
About Northstar Healthcare Inc.
Northstar partners with physicians in the ownership and management of ambulatory facilities and healthcare services. Northstar owns and manages interests in three ambulatory surgery centers, two in Houston and the third in Dallas.
Forward-looking statements
This news release may contain forward-looking statements (within the meaning of applicable securities laws) relating to business of Northstar Healthcare Inc. (the "Company") and the environment in which it operates. Forward-looking statements are identified by words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. These statements are based on the Company's expectations, estimates, forecasts and projections. They are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. These risks and uncertainties are discussed in the Company's regulatory filings available on the Company's web site at www.Northstar-Healthcare.com or at www.sedar.com. There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances.
For more information, contact:
Matthew Maruca
Tel: (713) 840-5180
E-mail: Email Contact
