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MarketScreener Homepage  >  Equities  >  Nasdaq  >  IMAC Holdings, Inc.    IMAC

IMAC HOLDINGS, INC.

(IMAC)
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IMAC Holdings Reports Second Quarter 2020 Financial Results

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08/14/2020 | 10:01am EDT

BRENTWOOD, Tenn., Aug. 14, 2020 (GLOBE NEWSWIRE) -- IMAC Holdings, Inc. (Nasdaq: IMAC) (“IMAC” or the “Company”), a provider of innovative medical advancements and care, specializing in regenerative rehabilitation treatments without the use of surgery or opioids, today announces its financial results for its second quarter ended June 30, 2020.

Recent Financial and Select Corporate Highlights:

  • Completed a $2.65 million offering of common stock
     
  • Received more than $2.1 million in financial aid from the US Department of Health and Human Services and Small Business Administration
     
  • Announced results from an internal analysis of treatment outcomes for musculoskeletal conditions showing over 80% of IMAC patients reported improvement in movement
     
  • Wellness Membership subscribers increased 30% during the quarter to 637 members
     
  • Headcount was 133 employees at June 30, down 16% for the year
     
  • On July 24, 2020, sold real estate in Lexington, Kentucky in a sale-leaseback transaction for a sale price of $1,300,000, eliminating $1,232,000 of liabilities, while entering into a five-year lease of the property with the purchaser
     
  • Received U.S. Food and Drug Administration authorization to initiate a clinical study of its umbilical cord-derived allogenic mesenchymal stem cells for the treatment of bradykinesia due to Parkinson’s disease

“The COVID-19 pandemic impacted on our day-to-day business, as reflected in decreases in key financial measurements compared to the previous quarter and the same period during 2019. While there was a decrease in patient visits and revenue, our implementation of advanced telemedicine therapy, acceleration of expense synergies, and utilization of government-sponsored aid helped us avoid a catastrophic reduction in business. We have already witnessed a recovery in business as evidenced in same-store visit growth of 7% in June 2020 as compared to June 2019,” noted Jeffrey Ervin, IMAC’s Chief Executive Officer.

“In addition, we received clearance to initiate a Phase 1 clinical trial of our umbilical cord-derived allogenic mesenchymal stem cells to improve movement for Parkinson’s disease patients. We appreciate the FDA for authorizing the trial to be conducted in IMAC clinics and our medical doctors are excited to be part of the process, which will significantly reduce trial costs. We are working to combine our already established movement and balance services with proprietary neurological services to expand our patient profile and competitive advantage beyond traditional rehabilitation centers. Furthermore, we believe our stem cell product could provide us with revenue expansion opportunities if our trial is successful.”

Results of Operations for the Three and Six Months Ended June 30, 2020

Patient service revenues decreased 32% to $2.6 million for the three months ended June 30, 2020, compared to $3.8 million for the three months ended June 30, 2019. This decrease was primarily due to the impact of COVID-19. Patient service revenues decreased 10% to $5.9 million for the six months ended June 30, 2020, compared to $6.5 million for the six months ended June 30, 2019. This decrease is attributable to the IMAC Chicago and IMAC Florida acquisitions that occurred in April 2019 and January 2020, respectively, along with the impact of COVID-19.

Net cash provided by financing activities during the six months ended June 30, 2020 was $5.9 million, including proceeds from notes payable, net of related fees and payments, which totaled $2.1 million, and proceeds from the issuance of common stock of $3.8 million. Net cash provided by financing activities during the six months ended June 30, 2019 was $4.1 million, including proceeds from our initial public offering, net of related fees.

About IMAC Holdings, Inc.

IMAC Holdings was created in March 2015 to expand on the footprint of the original IMAC Regeneration Center, which opened in Kentucky in August 2000. IMAC Regeneration Centers combine life science advancements with traditional medical care for movement-restricting diseases and conditions. It owns or manages 15 outpatient clinics that provide regenerative, orthopedic and minimally invasive procedures and therapies. It has partnered with several active and former professional athletes, opening two Ozzie Smith IMAC Regeneration Centers, two David Price IMAC Regeneration Centers, one Tony Delk IMAC Regeneration Center, and three IMAC Regeneration Centers sponsored by Mike Ditka. IMAC’s outpatient medical clinics emphasize its focus around treating sports and orthopedic injuries without surgery or opioids. More information about IMAC Holdings, Inc. is available at www.imacregeneration.com

Safe Harbor Statement

This press release contains forward-looking statements. These forward-looking statements, and terms such as “anticipate,” “expect,” “believe,” “may,” “will,” “should” or other comparable terms, are based largely on IMAC's expectations and are subject to a number of risks and uncertainties, certain of which are beyond IMAC's control. Actual results could differ materially from these forward-looking statements as a result of, among other factors, risks and uncertainties associated with its ability to raise additional funding, its ability to maintain and grow its business, variability of operating results, its ability to maintain and enhance its brand, its development and introduction of new products and services, the successful integration of acquired companies, technologies and assets, marketing and other business development initiatives, competition in the industry, general government regulation, economic conditions, dependence on key personnel, the ability to attract, hire and retain personnel who possess the skills and experience necessary to meet customers’ requirements, and its ability to protect its intellectual property. IMAC encourages you to review other factors that may affect its future results in its registration statement and in its other filings with the Securities and Exchange Commission. In light of these risks and uncertainties, there can be no assurance that the forward-looking information contained in this press release will in fact occur.

IMAC Press Contact:
Laura Fristoe
lfristoe@imacrc.com

Investors:
Bret Shapiro
(516) 222-2560
brets@coreir.com


IMAC HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

  June 30,
2020
  December 31,
2019
 
ASSETS        
Current assets:        
Cash $2,802,769  $373,689 
Accounts receivable, net  1,489,872   1,258,325 
Deferred compensation, current portion  263,859   312,258 
Other assets  336,958   633,303 
Total current assets  4,893,458   2,577,575 
         
Property and equipment, net  3,293,992   3,692,009 
         
Other assets:        
Goodwill  2,040,696   2,040,696 
Intangible assets, net  7,081,218   7,169,072 
Deferred equity costs  143,655   170,274 
Deferred compensation, net of current portion  356,085   549,563 
Security deposits  451,284   499,488 
Right of use asset  3,600,198   3,719,401 
Total other assets  13,673,136   14,148,494 
         
Total assets $21,860,586  $20,418,078 
         
LIABILITIES AND STOCKHOLDERS’ EQUITY        
         
Current liabilities:        
Accounts payable and accrued expenses $2,543,165  $2,909,666 
Patient deposits  351,142   189,691 
Notes payable, current portion, net of deferred loan costs  4,471,874   1,422,554 
Finance lease obligation, current portion  17,853   17,473 
Line of credit  79,961   79,961 
Liability to issue common stock, current portion  326,356   421,044 
Operating lease liability, current portion  980,967   1,025,247 
Total current liabilities  8,771,318   6,065,636 
         
Long-term liabilities:        
Notes payable, net of current portion  1,232,677   2,109,065 
Finance lease obligation, net of current portion  57,542   66,565 
Liability to issue common stock, net of current portion  362,979   578,866 
Operating lease liability, net of current portion  3,482,242   3,660,654 
Other non-current liabilities  30,000   - 
         
Total liabilities  13,936,758   12,480,786 
         
Stockholders’ equity:        
Preferred stock - $0.001 par value, 5,000,000 authorized, nil issued and outstanding at June 30, 2020 and December 31, 2019  -   - 
Common stock - $0.001 par value, 30,000,000 authorized, 11,839,973 and 8,913,258 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively  11,834   8,907 
Additional paid-in capital  24,079,504   20,050,634 
Accumulated deficit  (13,806,283)  (10,042,050)
Non-controlling interest  (2,361,227)  (2,080,199)
Total stockholders’ equity  7,923,828   7,937,292 
         
Total liabilities and stockholders’ equity $21,860,586  $20,418,078 

See accompanying notes to the unaudited condensed consolidated financial statements.

IMAC HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

  Three Months Ended June 30,  Six Months Ended June 30, 
  2020  2019  2020  2019 
             
Patient revenues, net $2,572,580  $3,756,755  $5,881,649  $6,526,583 
Management fees  -   -   12,487   - 
Total revenue  2,572,580   3,756,755   5,894,136   6,526,583 
                 
Operating expenses:                
Patient expenses  405,367   927,778   785,184   1,363,907 
Salaries and benefits  2,334,249   2,593,209   5,260,399   4,657,832 
Share-based compensation  121,945   171,590   203,029   175,339 
Advertising and marketing  174,350   349,328   416,167   696,344 
Grant funds  (415,978)  -   (415,978)  - 
General and administrative  1,208,457   1,429,822   2,444,595   2,407,191 
Depreciation and amortization  453,651   396,989   904,146   682,556 
Total operating expenses  4,282,041   5,868,716   9,597,542   9,983,169 
                 
Operating loss  (1,709,461)  (2,111,961)  (3,703,406)  (3,456,586)
                 
Other income (expense):                
Interest income  39   5   39   5 
Other income (expenses)  -   665   -   (15,290)
Beneficial conversion interest expense  -   -   -   (639,159)
Loss on extinguishment of debt  (109,544)  -   (109,544)  - 
Loss on disposal of assets  (21,225)  -   (21,225)  - 
Interest expense  (134,921)  (85,210)  (211,125)  (115,881)
Total other (expenses)  (265,651)  (84,540)  (341,855)  (770,325)
                 
Net loss before income taxes  (1,975,112)  (2,196,501)  (4,045,261)  (4,226,911)
                 
Income taxes  -   -   -   - 
                 
Net loss  (1,975,112)  (2,196,501)  (4,045,261)  (4,226,911)
                 
Net loss (income) attributable to the non-controlling interest  (55,576)  295,733   281,028   726,956 
                 
Net loss attributable to IMAC Holdings, Inc. $(2,030,688) $(1,900,768) $(3,764,233) $(3,499,955)
                 
Net loss per share attributable to common stockholders                
Basic and diluted $(0.20) $(0.23) $(0.38) $(0.50)
                 
Weighted average common shares outstanding                
Basic and diluted  10,184,294   8,106,177   9,897,773   7,018,559 

See accompanying notes to the unaudited condensed consolidated financial statements.

   

IMAC HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)

  Common Stock  Additional  Non-       
  Number of
Shares
  Par  Paid-In-
Capital
  Controlling
Interest
  Accumulated Deficit  Total 
                   
Balance, December 31, 2018  4,553,623  $4,534  $1,233,966  $(1,625,840) $(3,544,820) $(3,932,160)
Common stock issued for initial public offering proceeds, net of related fees  850,000   850   3,503,314   -   -   3,504,164 
Issuance of common stock in connection with convertible notes  449,217   449   2,245,636   -   -   2,246,085 
Issuance of common stock in connection with acquisitions  1,410,183   1,410   7,247,798   -   -   7,249,208 
Exercise of warrants  9,900   10   49,490   -   -   49,500 
Net loss  -   -   -   (431,223)  (1,599,187)  (2,030,410)
Balance, March 31, 2019  7,252,923   7,253   14,280,204   (2,057,063)  (5,144,007)  7,086,387 
Issuance of common stock in connection with acquisitions  1,002,306   1,002   4,072,436   -   -   4,073,438 
Exercise of warrants  61,569   62   307,783   -   -   307,845 
Issuance of employee stock options  -   -   16,216   -   -   16,216 
Net loss  -   -   -   (295,733)  (1,900,768)  (2,351,875)
Balance, June 30, 2019  8,316,798  $8,317  $18,676,639  $(2,352,796) $(7,044,775) $9,287,385 


  Common Stock  Additional  Non-       
  Number of
Shares
  Par  Paid-In-
Capital
  Controlling
Interest
  Accumulated Deficit  Total 
                   
Balance, December 31, 2019  8,913,258  $8,907  $20,050,634  $(2,080,199) $(10,042,050) $7,937,292 
Issuance of common stock  1,095,840   1,096   1,376,122   -   -   1,377,218 
Issuance of employee stock options  -   -   38,359   -   -   38,359 
Net loss  -   -   -   (336,604)  (1,733,545)  (2,070,149)
Balance, March 31, 2020  10,009,098   10,003   21,465,115   (2,416,803)  (11,775,595)  7,282,720 
Issuance of common stock  1,830,875   1,831   2,576,820   -   -   2,578,651 
Issuance of employee stock options  -   -   37,569   -   -   37,569 
Net income (loss)  -   -   -   55,576   (2,030,688)  (1,975,112)
Balance, June 30, 2020  11,839,973  $11,834  $24,079,504  $(2,361,227) $(13,806,283) $7,923,828 

See accompanying notes to unaudited condensed consolidated financial statements.

   

IMAC HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

  Six Months Ended
June 30,
 
  2020  2019 
Cash flows from operating activities:        
Net loss $(4,045,261) $(4,226,911)
Adjustments to reconcile net loss to net cash used in operating activities:        
Depreciation and amortization  904,146   682,556 
Beneficial conversion interest expense  -   639,159 
Share based compensation  203,030   175,339 
Loss on disposition of assets  (16,577)  - 
(Increase) decrease in operating assets:        
Accounts receivable, net  (210,707)  (259,712)
Other assets  299,721   (98,685)
Security deposits  48,204   (70,773)
Increase (decrease) in operating liabilities:        
Accounts payable and accrued expenses  (329,056)  675,820 
Patient deposits  161,451   861,409 
Lease incentive obligation  -   (57,262)
Net cash used in operating activities  (2,985,049)  (1,679,060)
         
Cash flows from investing activities:        
Purchase of property and equipment  (10,511)  (389,469)
Purchase of license fee  (243,750)  - 
Acquisition of IMAC Florida (Note 6)  (200,000)  - 
Net cash used in investing activities  (454,261)  (389,469)
         
Cash flows from financing activities:        
Proceeds from initial public offering, net of related fees  -   3,839,482 
Proceeds from warrants exercised  -   357,345 
Proceeds from issuance of common stock  3,774,617   - 
Proceeds from notes payable  2,891,520   100,000 
Payments on notes payable  (719,104)  (54,377)
Payments of debt issuance costs  (70,000)  - 
Proceeds from line of credit  -   20,000 
Payments on line of credit  -   (150,000)
Payments on finance lease obligation  (8,643)  (6,835)
Net cash provided by financing activities  5,868,390   4,105,615 
         
Net increase in cash  2,429,080   2,037,086 
         
Cash, beginning of period  373,689   194,316 
         
Cash, end of period $2,802,769  $2,231,402 
         
Supplemental cash flow information:        
Interest paid $56,058  $30,671 
Non cash financing and investing:        
Debt discount notes payable $115,000  $- 
Business acquisition via stock issuance $-  $3,771,978 

See accompanying notes to the unaudited condensed consolidated financial statements.

   

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Financials (USD)
Sales 2020 14,0 M - -
Net income 2020 -7,50 M - -
Net Debt 2020 - - -
P/E ratio 2020 -1,22x
Yield 2020 -
Capitalization 9,99 M 9,99 M -
Capi. / Sales 2020 0,71x
Capi. / Sales 2021 0,55x
Nbr of Employees 120
Free-Float 61,0%
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Mean consensus BUY
Number of Analysts 1
Average target price 4,50 $
Last Close Price 0,84 $
Spread / Highest target 433%
Spread / Average Target 433%
Spread / Lowest Target 433%
EPS Revisions
Managers
NameTitle
Jeffrey S. Ervin Chairman & Chief Executive Officer
Matthew C. Wallis Chief Operating Officer & Director
Sheri Gardzina Secretary, Chief Financial & Accounting Officer
George P. Hampton Independent Director
David K. Ellwanger Independent Director
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