First Choice Healthcare Reports Third Quarter 2014 Results

Comparable Nine Month Revenues Climb 38% Fueled by 46% Increase in Net Patient Service Revenues

MELBOURNE, FL -- (Marketwired) -- 11/17/14 -- 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 third quarter results for the three and nine months ended September 30, 2014.

Financial Highlights for the Three Months Ended September 30, 2014 Compared to the Three Months Ended September 30, 2013:

  • Total revenues were $1,891,045, up 14% from $1,654,730.

    • Net patient service revenue less provision for bad debts generated by our flagship Medical Center of Excellence, First Choice Medical Group, rose 17% to $1,627,157 from $1,395,610.
    • Rental revenue from our real estate holding, Marina Towers, remained relatively flat at $263,888 compared to $259,120.

  • After factoring non-cash expenses related to depreciation, bad debt expense and stock-based compensation totaling $502,210, net loss from operations was $140,886. This compared to net income from operations of $142,864 after factoring $211,800 in non-cash depreciation and stock-based compensation expenses.

    • Notwithstanding the noted non-cash expenses, income from operations increased modestly to $361,324 from $354,664.

  • Net loss totaled $375,620, or $0.02 loss per basic and diluted share, representing a 105% increase over a net loss of $183,409, or $0.01 loss per basic and diluted share.

Financial Highlights for the Nine Months Ended September 30, 2014 Compared to the Nine Months Ended September 30, 2013:

  • Total revenues climbed 38% to $6,232,962 from $4,525,981.

    • Net revenues from patient service less provision for debts increased 46% to $5,448,428 from $3,739,435.
    • Rental revenue remained flat at $784,534 compared to $786,546.

  • Net loss from operations totaled $148,254 after factoring non-cash expenses related to depreciation, bad debt expense and stock-based compensation of $976,345. This compared to net income from operations of $286,909, inclusive of non-cash expenses of $529,678 for depreciation and stock-baed compensation.

    • Notwithstanding the non-cash expenses, net income from operations increased to $828,091 from $816,587.

  • After factoring interest expense of $651,228 and amortization financing costs of $62,058, the net loss for the first nine months of 2014 totaled $859,290, or $0.05 loss per basic and diluted share. For the comparable nine-month period in 2013, net loss was $558,871, or $0.04 loss per basic and diluted share, after giving consideration to $983,966 in interest expense and amortization financing costs of $51,477, offset by $187,351 related to a gain on change in fair value of a derivative liability.

  • Adjusted EBITDA1 was $402,517, compared to $1,006,250.

As of September 30, 2014, the Company had cash and restricted cash totaling $477,690; accounts receivable of $2,114, 525; total liabilities of $13,732,759, which included $8,938,980 in long term debt; and total stockholders' deficit of $1,798,933.

"We are pleased that our third quarter revenue results continued to reflect the momentum we are building at First Choice Medical Group," stated Chris Romandetti, Chairman, President and CEO of First Choice. "As we approach the yearend, we remain squarely focused on achieving sustainable positive operating cash flow while investing back in our business through strategic acquisitions, continued expansion of our core leadership team and ongoing innovation in our systems of operations."

1 This press release includes information relating to Adjusted EBITDA Modified for Non-Cash Items, which is a financial measures that has not been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). This non-GAAP financial measure is not a measurement of financial performance under GAAP, and should not be considered as an alternative to GAAP measures or as indications of operating performance or any other measure of performance derived in accordance with GAAP. We do not consider these non-GAAP financial measures to be a substitute for, or superior to, the information provided by GAAP financial measures. These non-GAAP financial measures have been included in this press release because they are measures used by our management and board of directors to understand our business, make operating decisions and understanding and evaluating our operating results.

Adjusted EBITDA is a non-GAAP financial measure defined by us as net income/loss before interest expense, net, depreciation and amortization expenses and stock-based compensation expense. We have presented Adjusted EBITDA in this press release because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short and long-term operational plans. In particular, we believe that the exclusion of the amounts eliminated in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. You should consider Adjusted EBITDA along with other GAAP-based financial performance measures, including various cash flow metrics, loss, and our GAAP financial results. For a reconciliation of non-GAAP financial measures to the nearest comparable GAAP financial measures for each of the periods indicated, "Reconciliation of Adjusted EBITDA Modified for Non-Cash Items" included in this press release.

FINANCIAL CHARTS TO FOLLOW

FIRST CHOICE HEALTHCARE SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2014 2013
(unaudited)
ASSETS
Current assets
Cash $ 137,018 $ 739,158
Cash-restricted 340,672 256,246
Accounts receivable, net 2,114,525 1,272,155
Prepaid and other current assets 264,440 140,580
Capitalized financing costs, current portion 57,348 57,348
Total current assets 2,914,003 2,465,487
Property, plant and equipment, net of accumulated depreciation of $2,341,377 and $1,959,127 8,425,452 8,662,057
Other assets
Capitalized financing costs, long term portion 69,483 131,540
Patient list, net of accumulated amortization of $50,000 and $35,000 250,000 265,000
Patents, net of amortization of $14,325 272,175 286,500
Deposits 2,713 2,713
Total other assets 594,371 685,753
Total assets $ 11,933,826 $ 11,813,297
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued expenses $ 1,078,142 $ 459,000
Stock based payable 28,750 166,340
Advances 50,000 -
Line of credit, short term 1,202,000 800,000
Convertible note payable, short term portion 1,611,626 -
Notes payable, current portion 781,162 743,787
Unearned revenue 42,099 74,934
Total current liabilities 4,793,779 2,244,061
Long term debt:
Deposits held 72,901 72,901
Convertible note payable, long term portion 537,209 2,347,403
Notes payable, long term portion 8,328,870 8,935,473
Total long term debt 8,938,980 11,355,777
Total liabilities 13,732,759 13,599,838
Stockholders' deficit
Preferred stock, $0.001 par value; 1,000,000 shares authorized, Nil issued and outstanding - -
Common stock, $0.001 par value; 100,000,000 shares authorized, 17,688,804 and 16,747,248 shares issued and outstanding as of September 30, 2014 and December 31, 2013, respectively 17,689 16,747
Additional paid in capital 12,406,205 11,560,249
Accumulated deficit (14,222,827 ) (13,363,537 )
Total stockholders' deficit (1,798,933 ) (1,786,541 )
Total liabilities and stockholders' deficit $ 11,933,826 $ 11,813,297

FIRST CHOICE HEALTHCARE SOLUTIONS, INC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three months ended September 30, Nine months ended September 30,
2014 2013 2014 2013
Revenues:
Patient service revenue $ 1,917,597 $ 1,395,610 $ 5,814,140 $ 3,739,435
Provision for bad debts (290,440 ) - (365,712 ) -
Net patient service revenue less provision for bad debts 1,627,157 1,395,610 5,448,428 3,739,435
Rental revenue 263,888 259,120 784,534 786,546
Total Revenue 1,891,045 1,654,730 6,232,962 4,525,981
Operating expenses:
Salaries & benefits 925,513 735,888 3,081,840 2,000,436
Other operating expenses 407,699 353,034 1,264,046 965,923
General & administrative 548,635 298,566 1,623,755 898,911
Depreciation and amortization 150,084 124,378 411,575 373,803
Total operating expenses 2,031,931 1,511,866 6,381,217 4,239,073
Net (loss) income from operations (140,886 ) 142,864 (148,255 ) 286,908
Other income (expense):
Miscellaneous income 750 750 2,250 2,313
Gain on change in fair value of derivative liability - (1,631 ) - 187,351
Amortization Financing costs (20,686 ) (22,802 ) (62,058 ) (51,477 )
Interest expense, net (214,798 ) (302,590 ) (651,228 ) (983,966 )
Total other income (expense) (234,734 ) (326,273 ) (711,036 ) (845,779 )
Net loss before provision for income taxes (375,620 ) (183,409 ) (859,290 ) (558,871 )
Income taxes (benefit) - - - -
NET LOSS $ (375,620 ) $ (183,409 ) $ (859,290 ) $ (558,871 )
Net loss per common share, basic and diluted $ (0.02 ) $ (0.01 ) $ (0.05 ) $ (0.04 )
Weighted average number of common shares outstanding, basic and diluted 17,523,044 13,416,949 17,092,088 13,005,773

1Adjusted EBITDA Modified for Non-Cash Items
Nine Months Ended September 30,
2014 2013
NET LOSS $ (859,290 ) $ (588,870 )
Amortization 62,058 51,477
Depreciation 411,575 373,803
Interest 651,228 983,966
Taxes - -
Non-Cash Item: Stock-Based Compensation 137,001 155,875
EBITDA $ 402,571 $ 1,006,250

About First Choice Healthcare Solutions, Inc.
Headquartered in Melbourne, Florida, First Choice Healthcare Solutions (FCHS) is actively engaged in developing a network of 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 currently operates one Medical Center of Excellence, First Choice Medical Group of Brevard, which specializes in the delivery of musculoskeletal medicine and rehabilitative care. FCHS' 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 the Company's industry, management beliefs and certain assumptions made by its 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, the Company undertakes 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.

For additional information, please contact:
First Choice Healthcare Solutions, Inc.
Evelyn Viancardi
321-725-0090, Extension 208

Source: First Choice Healthcare Solutions, Inc.

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