Cardiff Lexington Corporation: Cardiff Lexington Announces Third Quarter 2024 Financial Results

LEXINGTON, KY / ACCESSWIRE / November 21, 2024 / Cardiff Lexington Corporation (OTC PINK:CDIX) announced today financial results for its third quarter and nine months ended September 30, 2024.

Alex Cunningham, Chief Executive Officer of Cardiff Lexington, commented, "Operationally, our business performed well during the quarter. We opened our 12^th Nova Ortho and Spine location in Orlando, Florida, establishing Nova Ortho and Spine in a major metropolitan area with greater population density and higher traffic, and saw an increase in booked procedures which generally bodes well for future revenues. That said, the severe weather across Florida during the quarter has delayed many procedures. Also, our GAAP revenue was negatively impacted in the quarter due to a change in estimate related to our claim settlement realization rate that better aligns third quarter revenue with 2024 annualized rates. Adjusted revenue for the quarter, excluding this one-time change in estimate, was $3.0 million. It is our expectation that revenue will return to more historical levels going forward and grow as we strengthen our working capital to support the long-term growth of our business."

"Demand is strong, and we continue to identify strategic locations to establish new Nova Ortho and Spine offices and expand our network of healthcare services. Our shareholders' equity has grown 410% since the beginning of the year, and with our visibility today, we believe that we are on track to deliver enhanced long-term performance supported by a robust network of locations and a strong reputation as a high-quality medical care provider," Mr. Cunningham concluded.

Third Quarter 2024 Financial Results

• Total revenue was $1,355,641. Revenue in the third quarter included a one-time non-cash adjustment of $1,650,474 to better align third quarter revenue with 2024 annualized claim settlement realization rates. Non-GAAP adjusted revenue, excluding the one-time non-cash adjustment, was $3,006,115

• Cost of sales in the quarter increased to $1,000,601 primarily related to laboratory fees

• Selling, general, and administrative expenses of $936,835 primarily related to increased salaries and wages as the Company continues to invest in its growth

• Loss from continuing operations was $585,160

• Non-GAAP adjusted EBITDA was $1,061,912

Nine Months 2024 Financial Results

• Total revenue was $5,149,416. Revenue for the nine months ended September 30, 2024, included a one-time non-cash adjustment of $1,650,474 to better align third quarter 2024 revenue with 2024 annualized claim settlement realization rates. Non-GAAP adjusted revenue, excluding this one-time non-cash adjustment, was $6,799,890

• Cost of sales for the nine-month period was $2,741,765

• Selling, general, and administrative expenses of $2,622,981 primarily related to increased salaries and wages as the Company continues to invest in its growth

• Loss from continuing operations was $525,651. Included in operating expenses for the nine months ended September 30, 2024 were Non-GAAP increased expenses associated with the anticipated growth of the business of $596,225

• Non-GAAP Adjusted EBITDA was $1,507,928

Balance Sheet Highlights (September 30, 2024, compared to December 31, 2023)

• 125% increase in cash to $1,949,600

• 13% increase in total assets to $23,514,762

• 410% increase in shareholders' equity to $3,729,120

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About Cardiff Lexington Corporation:

Cardiff Lexington Corporation is a unique targeted healthcare holding company focused on locating, acquiring, and building middle market, niche companies, primarily in Orthopedics, Spine Care, and Pain Management. Fundamental to the Cardiff Lexington strategy is the service-based partnership culture which emphasizes core values, teamwork, accountability, and performance.

A substantial majority of the Company's revenue is derived from Nova Ortho and Spine, LLC, which operates a group of regional primary specialty and ancillary care facilities throughout Florida that provide traumatic injury victims with a full range of diagnostic and surgical services, primary care evaluations, interventional pain management, and specialty consultation services.

For more information on Cardiff Lexington Corporation, you may access the company's website at https://cardifflexington.com/

FORWARD LOOKING STATEMENT: This news release contains forward looking statements within the meaning of the Securities Litigation Reform Act. The statements reflect the Company's current views with respect to future events that involve risks and uncertainties. These risks include the failure to meet schedule or performance requirements of the Company's business, the Company's liquidity position, the Company's ability to obtain new business, the emergence of competitors with greater financial resources, and the impact of competitive pricing. In the light of these uncertainties the forward-looking events referred to in this release might not occur.

Use of Non-GAAP Financial Measures

Cardiff Lexington Corporation prepares its consolidated financial statements in accordance with United States generally accepted accounting principles ("GAAP"). In addition to GAAP disclosures, this document contains financial information and measures considered to be "non-GAAP". These non-GAAP measures can be used in order to gain a more complete and accurate understanding of the Company's financial condition and results. Non-GAAP financial measures should be considered in conjunction with, and not as a substitute to GAAP financial measures.

Cardiff Lexington Investor Relations
[e-mail]
[phone] ext. 705

or

IMS Investor Relations
[e-mail]

CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(UNAUDITED)

		Unaudited								Unaudited
		For the Three Months Ended								For the Nine Months Ended
		September 30,				September 30,				September 30,				September 30,
		2024				2023 (Restated)				2024				2023 (Restated)
Total revenue		$	1,355,641			$	3,405,859			$	5,149,416			$	9,476,764
Total cost of sales			1,000,601				551,423				2,741,765				2,589,407
Gross profit			355,040				2,854,436				2,407,651				6,887,357
Operating expenses
Depreciation expense			3,365				3,365				10,096				11,365
Selling, general and administrative			936,835				577,677				2,622,981				2,095,611
Stock compensation expense			0				0				300,225				0
Total operating expenses			940,200				581,042				2,933,302				2,106,976
(Loss) income from continuing operations			(585,160	)			2,273,394				(525,651	)			4,780,381
Other income (expense):
Other (expense) income			(6,767	)			(1	)			(4,720	)			204
Gain on debt refinance, forgiveness and settlement			0				0				78,834				390
Penalties and fees			0				(16,000	)			(1,330	)			(48,000	)
Interest expense			(1,386,041	)			(226,119	)			(1,803,657	)			(1,763,698	)
Amortization of debt discounts			0				(46,048	)			(24,821	)			(94,664	)
Total other (expense) income			(1,392,808	)			(288,168	)			(1,755,694	)			(1,905,768	)
Net (loss) income before discontinued operations			(1,977,968	)			1,985,226				(2,281,345	)			2,874,613
Loss from discontinued operations			0				(3,705	)			(111,312	)			(93,005	)
Net (loss) income		$	(1,977,968	)		$	1,981,521			$	(2,392,657	)		$	2,781,608

CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2024 AND DECEMBER 31, 2023
(UNAUDITED)

		September 30,				December 31,
		2024				2023 (Restated)
ASSETS
Current assets
Cash		$	1,949,600			$	866,943
Accounts receivable-net			14,798,220				13,305,254
Prepaid and other current assets			5,000				5,000
Total current assets			16,752,820				14,177,197
Property and equipment, net			24,563				34,661
Land			540,000				540,000
Goodwill			5,666,608				5,666,608
Right of use - assets, net			465,389				289,062
Due from related party			4,979				4,979
Other assets			60,403				33,304
Total assets		$	23,514,762			$	20,745,811
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expense		$	1,386,412			$	2,047,131
Accrued expenses - related parties			4,353,056				4,733,057
Accrued interest			361,172				620,963
Right of use - lease liabilities			227,606				157,669
Due to director and officer			0				120,997
Notes payable - current portion			500,826				15,977
Line of credit			7,468,971				2,120,100
Convertible notes payable, net of debt discounts of $0 and $24,820, respectively			105,000				3,807,030
Net liabilities of discontinued operations			237,643				237,643
Total current liabilities			14,640,686				13,860,567
Other liabilities
Notes payable			140,272				144,666
Operating lease liability - long term			236,853				119,056
Total liabilities			15,017,811				14,124,289
Mezzanine equity
Redeemable Series N Senior Convertible Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value $4.00, 868,056 shares issued and outstanding at September 30, 2024 and December 31, 2023			3,230,023				3,891,439
Redeemable Series R Senior Convertible Preferred Stock - 5,000 shares authorized, $0.001 par value, stated value of $1,200, 0 and 165 shares issued and outstanding at September 30, 2024 and December 31, 2023			0				307,980
Redeemable Series X Senior Convertible Preferred Stock - 5,000,000 shares authorized, $0.001 par value, stated value of $4.00 par value; 375,000 shares issued and outstanding at September 30, 2024 and December 31, 2023			1,537,808				1,690,685
Total Mezzanine Equity			4,767,831				5,890,104
Stockholders' equity
Series B Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value of $4.00, 753,929 and 2,139,478 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			3,015,716				8,557,912
Series C Preferred Stock - 500 shares authorized, $0.001 par value, stated value of $4.00, 43 and 123 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			172				492
Series E Preferred Stock - 1,000,000 shares authorized, $0.001 par value, stated value $4.00, 75,375 and 155,750 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			301,500				623,000
Series F-1 Preferred Stock - 50,000 shares authorized, $0.001 par value, stated value $4.00, 9,500 and 35,752 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			38,000				143,008
Series I Preferred Stock - 15,000,000 shares authorized, $0.001 par value, stated value $4.00, 11,540,500 and 14,885,000 issued and outstanding at September 30, 2024 and December 31, 2023, respectively			46,162,200				59,540,000
Series J Preferred Stock - 2,000,000 shares authorized, $0.001 par value, stated value $4.00, 0 and 1,713,584 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			-				6,854,336
Series L Preferred Stock - 400,000 shares authorized, $0.001 par value, stated value $4.00, 319,493 shares issued and outstanding at September 30, 2024 and December 31, 2023			1,277,972				1,277,972
Series Y Senior Preferred Stock - 1,000,000 shares authorized, $0.001 par value, stated value of $4.00, 955,114 and 0 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			3,820,456				-
Common Stock - 300,000,000 shares authorized, $0.001 par value; 14,555,601 and 25,121 shares issued and outstanding at September 30, 2024 and December 31, 2023			14,556				25
Additional paid-in capital			20,891,337				(7,581,212	)
Accumulated deficit			(71,792,589	)			(68,684,115	)
Total stockholders' equity			3,729,120				731,418
Total liabilities, mezzanine equity and stockholders' equity		$	23,514,762			$	20,745,811

CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(UNAUDITED)

The following table reconciles Net (loss) income before discontinued operations (a GAAP measure) to EBITDA (a non-GAAP measure)

		Unaudited								Unaudited
		For the Three Months Ended								For the Nine Months Ended
		September 30,								September 30,
		2024				2023 (Restated)				2024				2023 (Restated)
EBITDA (1)
Net (loss) income before discontinued operations		$	(1,977,968	)		$	1,985,226			$	(2,281,345	)		$	2,874,613
Add:
Interest			1,386,041				226,119				1,803,657				1,763,698
Taxes			0				0				0				0
Depreciation			3,365				3,365				10,096				11,365
Amortization			0				46,048				24,821				94,664
EBITDA (1)		$	(588,562	)		$	2,260,758			$	(442,771	)		$	4,744,340
Adjusted EBITDA (2)
EBITDA		$	(588,562	)		$	2,260,758			$	(442,771	)		$	4,744,340
Add:
Change in estimate for settlement realization rate			1,650,474				0				1,650,474				0
Stock compensation expense for shares issued			0				0				300,225				0
Adjusted EBITDA (2)		$	1,061,912			$	2,260,758			$	1,507,928			$	4,744,340
(1) EBITDA is a non-GAAP financial measure defined as Earnings Before Interest, Income Tax, Depreciation and Amortization.
(2) Adjusted EBITDA is a non-GAAP financial measure that is the sum of EBITDA plus non-recurring and non-cash charges.

CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF REVENUE FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024
(UNAUDITED)

		Unaudited				Unaudited
		For the Three Months Ended				For the Nine Months Ended
		September 30, 2024				September 30, 2024
GAAP Revenue		$	1,355,641			$	5,149,416
Adjustment to Claim Settlement Realization Rate			1,650,474				1,650,474
Non-GAAP Adjusted Revenue			3,006,115				6,799,890

Contact Information

Walter Frank
Investor Relations
[e-mail]
2039729200

SOURCE: Cardiff Lexington Corporation

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