First Choice Healthcare Solutions Announces Record 2013 Year-End Results

MELBOURNE, FL -- (Marketwired) -- 04/01/14 -- First Choice Healthcare Solutions, Inc. (OTCQB: FCHS) ("FCHS" or "First Choice"), a diversified holding company focused on delivering clinically superior, patient-centric, multi-specialty care through state-of-the-art medical centers of excellence, today announced its financial results for the fiscal year ended December 31, 2013.

2013 Financial Highlights

  • Total revenues climbed 71% to $6.51 million from total revenues of $3.81 million reported for 2012.

    • Net patient service revenue generated by the Company's flagship medical center of excellence, First Choice Medical Group of Brevard ("FCMG"), more than doubled, rising 106% to $5.46 million as compared to $2.65 million in the prior year.

  • Loss from operations for the year ended December 31, 2013 increased to $978,150, compared to a loss from operations of $277,740 for the prior year.

    • Notwithstanding non-cash expenses totaling $1,575,400 for stock-based compensation, impairment of investment, depreciation and amortization, income from operations totaled $597,250 in 2013. This compared to income from operations in 2012 of $89,507 deducting non-cash expenses totaling $367,247 for depreciation and amortization.

  • Due principally to the aforementioned non-cash charges and after factoring non-cash interest expense relating to the accounting of the private placement completed in November 2013 and other capital restructuring costs, the 2013 net loss totaled $4.70 million, or $0.35 loss per basic and diluted share, which compared to a net loss of $873,000, or $0.07 loss per basic and diluted share, for 2012.

  • As of December 31, 2013, the Company had cash and restricted cash totaling approximately $995,000, an increase of approximately $660,000 from December 31, 2012; and accounts receivable of $1.27 million, up from $528,000 in 2012.

Chris Romandetti, FCHS President and Chief Executive Officer, stated, "2013 was a very rewarding year for our Company -- a year in which we made material progress implementing and validating our Medical Centers of Excellence business model. The strong financial performance of our flagship center, FCMG, is in large measure due to the success we've had in expanding our team of physicians in 2013 to eight -- with three of these doctors joining us in the recent fourth quarter. Enhancing our overall mix of diagnostic and ancillary service offerings during the year, coupled with our local television and print marketing activities and community outreach initiatives, have served to fuel growth of our regional network of referring physicians, hospitals and surgical centers, which, in turn, has led to notable growth of the number of patients that now rely on FCMG for their musculoskeletal, diagnostic and rehabilitative care."

Continuing, Romandetti added, "Management is now squarely focused on replicating our Medical Center of Excellence model in key expansion markets. Increasing our top line revenues to at least $12 million by successfully executing our defined growth strategies, and continuing to practice expense discipline with a focus on profitability, are among our chief priorities in the current fiscal year. The Company believes these milestones coincide with our overarching goal of increasing shareholder value, and feel that we are well poised to make significant progress towards achieving our stated goals and objectives."

FINANCIAL CHARTS TO FOLLOW


                  FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
                        CONSOLIDATED BALANCE SHEETS
                         DECEMBER 31, 2013 AND 2012

                                                 December 31,  December 31,
ASSETS                                                   2013          2012
                                                 ------------  ------------
Current assets
Cash                                             $    739,158  $     67,045
Cash-restricted                                       256,246       221,148
Accounts receivable                                 1,272,155       527,867
Prepaid and other current assets                      140,580        69,970
Capitalized financing costs, current portion           57,348        57,348
                                                 ------------  ------------
  Total current assets                              2,465,487       943,378
                                                 ------------  ------------

Property, plant and equipment, net of
 accumulated depreciation of $1,959,127 and
 $1,465,939                                         8,662,057     8,756,631
                                                 ------------  ------------

Other assets
Capitalized financing costs, long term portion        131,540       152,911
Patient list, net of accumulated amortization of
 $35,000 and $24,391                                  265,000       275,609
Patents                                               286,500             -
Deposits                                                2,713         2,719
                                                 ------------  ------------
  Total other assets                                  685,753       431,239
                                                 ------------  ------------
Total assets                                     $ 11,813,297  $ 10,131,248
                                                 ============  ============

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued expenses            $    459,000  $    576,209
Stock based payable                                   166,340             -
Line of credit, short term                            800,000             -
Notes payable, current portion                        743,787       690,586
Note payable, related party                                 -       300,000
Convertible note payable, net of unamortized
 debt discount of $160,543                                  -        43,537
Unearned revenue                                       74,934        39,438
                                                 ------------  ------------
  Total current liabilities                         2,244,061     1,649,770
                                                 ------------  ------------

Long term debt:
Deposits held                                          72,901        47,399
Revolving line of credit, related party                     -       153,330
Convertible note payable, long term portion         2,347,403             -
Notes payable, long term portion                    8,935,473     9,410,296
Derivative liability                                        -       171,987
                                                 ------------  ------------
  Total long term debt                             11,355,777     9,783,012
                                                 ------------  ------------
Total liabilities                                  13,599,838    11,432,782
                                                 ------------  ------------
Stockholders' deficit
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, 16,747,248 and 12,706,795
 shares issued and outstanding as of December
 31, 2013 and 2012, respectively                       16,747        12,707
Additional paid in capital                         11,560,249     7,244,993
Common stock subscriptions                                  -       100,000
Accumulated deficit                               (13,363,537)   (8,659,234)
                                                 ------------  ------------
  Total stockholders' deficit                      (1,786,541)   (1,301,534)
                                                 ------------  ------------
Total liabilities and stockholders' deficit      $ 11,813,297  $ 10,131,248
                                                 ============  ============



                  FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
                   CONSOLIDATED STATEMENTS OF OPERATIONS

                                                  Year ended December 31,
                                                    2013           2012
                                               -------------  -------------
Revenues:
Net patient service revenue                    $   5,459,373  $   2,645,310
Rental revenue                                     1,048,469      1,160,037
                                               -------------  -------------
  Total revenue                                    6,507,842      3,805,347

Operating expenses:
Salaries and benefits                              3,096,285      1,593,245
Other operating expenses                           1,715,942        865,641
General and administrative                         1,705,154      1,314,302
Impairment of investment                             450,000              -
Depreciation and amortization                        518,611        309,899
                                               -------------  -------------
  Total operating expenses                         7,485,992      4,083,087
                                               -------------  -------------

Net income (loss) from operations                   (978,150)      (277,740)

Other income (expense):
Miscellaneous income                                   3,063          3,000
Gain (loss) on change in fair value of
 derivative liability                                 32,218           (987)
Amortization financing costs                         (57,348)       (57,348)
Interest expense, net                             (3,704,086)      (563,391)
                                               -------------  -------------
  Total other (expense)                           (3,726,153)      (618,726)
                                               -------------  -------------


Net loss before provision for income taxes        (4,704,303)      (896,466)

Income taxes (benefit)                                     -        (23,103)
                                               -------------  -------------

Net Loss                                       $  (4,704,303) $    (873,363)
                                               =============  =============

Net loss per common share, basic and diluted   $       (0.35) $       (0.07)
                                               =============  =============

Weighted average number of common shares
 outstanding, basic and diluted                   13,529,294     12,644,784
                                               =============  =============



                  FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
                   CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                  Year ended December 31,
                                                    2013           2012
                                               -------------  -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss                                       $  (4,704,303) $    (873,363)

Adjustments to reconcile net loss to cash used
 in operating activities:
Depreciation                                         518,611        309,899
Amortization of financing costs                       57,348         57,348
Bad debt expense                                     361,284              -

Amortization of debt discount in connection
 with convertible note                             2,706,869         10,457
Stock based compensation                             549,441              -
Common stock issued for loan modification             96,000              -
Impairment of investment                             450,000              -
Loss on change in fair value of debt
 derivative                                          (32,218)           987
Changes in operating assets and liabilities:
Accounts receivable                               (1,105,572)      (329,375)
Accounts receivable-other                                  -       (205,000)
Prepaid expenses and other                           (70,604)       (40,265)
Restricted funds                                     (35,098)      (131,209)
Accounts payable and accrued expenses                (91,312)       419,417
Unearned income                                       35,496         15,354
Deferred income taxes                                      -        (23,103)
                                               -------------  -------------
  Net cash provided by operating activities       (1,264,058)      (788,853)

CASH FLOWS FROM INVESTING ACTIVITIES:
Cash received from acquisition                             -         48,761
Cash payments for acquisition                              -       (143,366)
Purchase of equipment                               (397,688)    (2,773,450)
Net increase in deposits                              25,502         15,796
                                               -------------  -------------
  Net cash used in investing activities             (372,186)    (2,852,259)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net (payments) proceeds from related party
 line of credit                                      (10,846)       190,000
Proceeds from convertible note payable             2,128,117        203,500
Proceeds from lines of credit                      1,373,208              -

Proceeds from issuance of notes payable, net
 of financing costs                                  152,659      2,871,058
Proceeds from common stock subscription                    -        100,000
Net payments on notes payable                     (1,334,781)      (184,704)
                                               -------------  -------------
  Net cash provided by (used in) financing
   activities                                      2,308,357      3,179,854

Net increase (decrease) in cash and cash
 equivalents                                         672,113       (461,258)
Cash and cash equivalents, beginning of period        67,045        528,303
                                               -------------  -------------

Cash and cash equivalents, end of period       $     739,158  $      67,045
                                               =============  =============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW
 INFORMATION:
Cash paid during the period for interest       $     731,877  $     467,670
                                               =============  =============
Cash paid during the period for taxes          $           -  $           -
                                               =============  =============

Supplemental Disclosure on non-cash investing
 and financing activities:

Common stock issued in connection with
 acquisition of First Choice Medical Group,
 Inc.                                          $           -  $     497,725
                                               =============  =============
Common stock issued in settlement of note
 payable                                       $     624,000  $           -
                                               =============  =============

Common stock issued in settlement of related
 party line of credit                          $     142,484  $           -
                                               =============  =============

Common stock issued in connection with
 acquisition of patent                         $     286,500  $           -
                                               =============  =============

Common stock issued to acquire 10% interest in
 MedTech Diagnostics, LLC                      $     450,000  $           -
                                               =============  =============

Beneficial conversion feature on convertible
 note credited to additional paid-in-capital   $   1,871,117  $           -
                                               =============  =============

Reclassification of derivative liability to
 additional paid-in-capital                    $     366,094  $           -
                                               =============  =============

For more details on First Choice's fiscal 2013 year-end results, please refer to the Company's 10-K filed with the U.S. Securities and Exchange Commission and accessible at www.sec.gov.

About First Choice Healthcare Solutions, Inc.
Headquartered in Melbourne, Florida, First Choice Healthcare Solutions (FCHS) is actively engaged in owning and operating multi-specialty medical centers of excellence throughout the southeastern U.S., which are distinguished as premier destinations for clinically superior, patient-centric care. Through its wholly owned subsidiary FCID Medical, Inc., the Company operates its flagship center, First Choice Medical Group, which specializes in the delivery of musculoskeletal medicine, diagnostic services, and rehabilitative care. FCHS's commercial real estate interests, which house its medical centers of excellence, are managed by its wholly owned subsidiary, FCID Holdings, Inc. For more information, please visit www.myfchs.com or www.myfcmg.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 our industry, management beliefs and certain assumptions made by our 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, we undertake 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.

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For additional information, please contact:
HANOVER|ELITE
Kathy Addison
Chief Operating Officer
Phone: 407-585-1080
Email: FCHS@hanoverelite.com

Source: First Choice Healthcare Solutions, Inc.

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