Financial performance improves sequentially with record billable patient visits and highlights strong operational and fiscal management despite continued COVID-19 impact
Third Quarter Highlights and Recent Developments:
- Announced the opening of enrollment in early November in its Phase 1 clinical study of umbilical cord-derived mesenchymal stem cells for the treatment of bradykinesia due to Parkinson’s Disease
- Announced the addition of three new highly qualified independent directors – Maurice “Mo” Evans,
Michael Pruitt , andCary Sucoff – to its board of directors
- Sold its
Lexington, Ky. property for$1.3 million in a sale-leaseback transaction
- Reduced general and administrative expenses by 27% year-over-year and 20% quarter-over-quarter to
$961,521 in the third quarter of 2020 with positive impacts from the realization of expense synergies from centralized purchasing, improved ordering, inventory control, and expense management, most notably from lower travel expenses given the coronavirus pandemic
- Recognized record billable patient volume of 37,992 visits in the third quarter of 2020, up 8% year-over-year
- Patient expenses declined 55% to
$428,615 in the third quarter of 2020 from$950,517 in same period in 2019 due to improvements in supply management and a shift in service mix from knee care to spinal patients, who have a lower associated cost of therapy, reflecting behavioral adjustments associated with COVID-19-based activity restrictions
- Wellness Membership subscribers increased 20% sequentially during the quarter to 762 members
“We are at an exciting time in the Company’s development, with the recent launch of its Phase 1 clinical trial for IMAC’s umbilical cord-derived mesenchymal stem cell treatment for bradykinesia due to Parkinson’s disease. This is a complement to IMAC’s evolution as a regenerative rehabilitation company. These proprietary advancements give
“While the COVID-19 pandemic has continued to negatively impact IMAC’s revenue on a year-over-year basis, the Company has been extremely diligent and focused on continuing what it began prior to the pandemic to ensure that it is wisely allocating capital, strategically reducing expenses, and prudently managing operations. All of this is being done with an eye toward continuing to expand both in the markets where
“Looking at how that translates to patient care, patient visits increased 44% quarter-over-quarter while patient expenses decreased 55%. IMAC’s patient service mix shifted in the quarter to a higher concentration of spine patients, rather than knee patients, which lowered both IMAC’s average charge per visit as well as its patient treatment expense, driving quarter-over-quarter improvement. Lastly,
Results of Operations for the Three and Nine Months Ended
Net patient service revenues decreased 20% to
The Company reported a net loss per share for the quarter ending
About
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 Press Contact:
lfristoe@imacrc.com
Investors:
(516) 222-2560
brets@coreir.com
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
ASSETS | ||||||||
Current assets: | ||||||||
Cash | $ | 1,664,304 | $ | 373,689 | ||||
Accounts receivable, net | 1,433,457 | 1,258,325 | ||||||
Deferred compensation, current portion | 241,946 | 312,258 | ||||||
Other assets | 452,741 | 633,303 | ||||||
Total current assets | 3,792,448 | 2,577,575 | ||||||
Property and equipment, net | 1,861,879 | 3,692,009 | ||||||
Other assets: | ||||||||
2,040,696 | 2,040,696 | |||||||
Intangible assets, net | 6,846,385 | 7,169,072 | ||||||
Deferred equity costs | 143,655 | 170,274 | ||||||
Deferred compensation, net of current portion | 310,006 | 549,563 | ||||||
Security deposits | 413,407 | 499,488 | ||||||
Right of use asset | 3,965,755 | 3,719,401 | ||||||
Total other assets | 13,719,904 | 14,148,494 | ||||||
Total assets | $ | 19,374,231 | $ | 20,418,078 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable and accrued expenses | $ | 2,367,438 | $ | 2,909,666 | ||||
Patient deposits | 373,678 | 189,691 | ||||||
Notes payable, current portion, net of deferred loan costs | 1,839,306 | 1,422,554 | ||||||
Finance lease obligation, current portion | 18,047 | 17,473 | ||||||
Line of credit | 79,961 | 79,961 | ||||||
Liability to issue common stock, current portion | 310,575 | 421,044 | ||||||
Operating lease liability, current portion | 1,051,964 | 1,025,247 | ||||||
Total current liabilities | 6,040,969 | 6,065,636 | ||||||
Long-term liabilities: | ||||||||
Notes payable, net of current portion | 2,671,333 | 2,109,065 | ||||||
Finance lease obligation, net of current portion | 52,957 | 66,565 | ||||||
Liability to issue common stock, net of current portion | 378,760 | 578,866 | ||||||
Operating lease liability, net of current portion | 3,723,398 | 3,660,654 | ||||||
Other non-current liabilities | 15,000 | - | ||||||
Total liabilities | 12,882,417 | 12,480,786 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock - | - | - | ||||||
Common stock - | 11,834 | 8,907 | ||||||
Additional paid-in capital | 24,119,889 | 20,050,634 | ||||||
Accumulated deficit | (15,235,941 | ) | (10,042,050 | ) | ||||
Non-controlling interest | (2,403,968 | ) | (2,080,199 | ) | ||||
Total stockholders’ equity | 6,491,814 | 7,937,292 | ||||||
Total liabilities and stockholders’ equity | $ | 19,374,231 | $ | 20,418,078 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended | Nine Months Ended | ||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||
Patient revenues, net | $ | 3,477,841 | $ | 4,355,904 | $ | 9,359,490 | $ | 10,882,487 | |||||||||
Management fees | - | - | 12,487 | - | |||||||||||||
Total revenue | 3,477,841 | 4,355,904 | 9,371,977 | 10,882,487 | |||||||||||||
Operating expenses: | |||||||||||||||||
Patient expenses | 428,615 | 950,517 | 1,213,799 | 2,314,424 | |||||||||||||
Salaries and benefits | 2,622,266 | 2,878,391 | 7,882,665 | 7,536,223 | |||||||||||||
Share-based compensation | 108,377 | 112,959 | 311,406 | 288,298 | |||||||||||||
Advertising and marketing | 234,694 | 317,800 | 650,861 | 1,014,144 | |||||||||||||
Grant funds | - | - | (415,978 | ) | - | ||||||||||||
General and administrative | 961,521 | 1,311,315 | 3,406,116 | 3,718,506 | |||||||||||||
Depreciation and amortization | 430,121 | 422,405 | 1,334,267 | 1,104,961 | |||||||||||||
Total operating expenses | 4,785,594 | 5,993,387 | 14,383,136 | 15,976,556 | |||||||||||||
Operating loss | (1,307,753 | ) | (1,637,483 | ) | (5,011,159 | ) | (5,094,069 | ) | |||||||||
Other income (expense): | |||||||||||||||||
Interest income | 6,028 | 120 | 6,067 | 125 | |||||||||||||
Other income (expenses) | 6 | (94 | ) | 6 | (15,384 | ) | |||||||||||
Beneficial conversion interest expense | - | - | - | (639,159 | ) | ||||||||||||
Gain (loss) on extinguishment of debt | 9,783 | - | (99,761 | ) | - | ||||||||||||
Loss on disposal of assets | (39,047 | ) | - | (60,272 | ) | - | |||||||||||
Interest expense | (141,416 | ) | (74,456 | ) | (352,541 | ) | (190,337 | ) | |||||||||
Total other (expenses) | (164,646 | ) | (74,430 | ) | (506,501 | ) | (844,755 | ) | |||||||||
Net loss before income taxes | (1,472,399 | ) | (1,711,913 | ) | (5,517,660 | ) | (5,938,824 | ) | |||||||||
Income taxes | - | - | - | - | |||||||||||||
Net loss | (1,472,399 | ) | (1,711,913 | ) | (5,517,660 | ) | (5,938,824 | ) | |||||||||
Net loss attributable to the non-controlling interest | 42,741 | 162,951 | 323,769 | 889,907 | |||||||||||||
Net loss attributable to | $ | (1,429,658 | ) | $ | (1,548,962 | ) | $ | (5,193,891 | ) | $ | (5,048,917 | ) | |||||
Net loss per share attributable to common stockholders | |||||||||||||||||
Basic and diluted | $ | (0.12 | ) | $ | (0.19 | ) | $ | (0.49 | ) | $ | (0.68 | ) | |||||
Weighted average common shares outstanding | |||||||||||||||||
Basic and diluted | 11,839,972 | 8,366,287 | 10,549,899 | 7,472,738 | |||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
Common Stock | Additional | Non- | ||||||||||||||||||||||
Number of Shares | Par | Paid-In- Capital | Controlling Interest | Accumulated Deficit | Total | |||||||||||||||||||
Balance, | 4,533,623 | $ | 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, | 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 | ) | (2,196,501 | ) | |||||||||||||||
Balance, | 8,316,798 | 8,317 | 18,676,639 | (2,352,796 | ) | (7,044,775 | ) | 9,287,385 | ||||||||||||||||
Issuance of common stock | 133,297 | 133 | 150,652 | - | - | 150,785 | ||||||||||||||||||
Issuance of employee stock options | - | - | 35,963 | - | - | 35,963 | ||||||||||||||||||
Net loss | - | - | - | (162,951 | ) | (1,548,962 | ) | (1,711,913 | ) | |||||||||||||||
Balance, | 8,450,095 | $ | 8,450 | $ | 18,863,254 | $ | (2,515,747 | ) | $ | (8,593,737 | ) | $ | 7,762,220 |
Common Stock | Additional | Non- | ||||||||||||||||||||||
Number of Shares | Par | Paid-In- Capital | Controlling Interest | Accumulated Deficit | Total | |||||||||||||||||||
Balance, | 8,913,257 | $ | 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, | 10,009,097 | 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, | 11,839,972 | 11,834 | 24,079,504 | (2,361,227 | ) | (13,806,283 | ) | 7,923,828 | ||||||||||||||||
Issuance of employee stock options | - | - | 40,385 | - | - | 40,385 | ||||||||||||||||||
Net loss | - | - | - | (42,741 | ) | (1,429,658 | ) | (1,472,399 | ) | |||||||||||||||
Balance, | 11,839,972 | $ | 11,834 | $ | 24,119,889 | $ | (2,403,968 | ) | $ | (15,235,941 | ) | $ | 6,491,814 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended | ||||||||
2020 | 2019 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (5,517,660 | ) | $ | (5,938,824 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 1,334,267 | 1,104,961 | ||||||
Beneficial conversion interest expense | - | 639,159 | ||||||
Share based compensation | 311,406 | 288,298 | ||||||
Loss on disposition of assets | 1,959 | - | ||||||
Non cash expense | - | 150,785 | ||||||
(Increase) decrease in operating assets: | ||||||||
Accounts receivable, net | (154,292 | ) | 64,046 | |||||
Other assets | 251,976 | (53,450 | ) | |||||
Security deposits | 86,081 | (59,966 | ) | |||||
Increase (decrease) in operating liabilities: | ||||||||
Accounts payable and accrued expenses | (518,074 | ) | 736,704 | |||||
Patient deposits | 183,987 | 358,906 | ||||||
Lease incentive obligation | - | (85,894 | ) | |||||
Net cash used in operating activities | (4,020,350 | ) | (2,795,275 | ) | ||||
Cash flows from investing activities: | ||||||||
Purchase of property and equipment | (52,626 | ) | (688,312 | ) | ||||
Purchase of license fee | (243,750 | ) | - | |||||
Acquisition of IMAC Florida (Note 6) | (200,000 | ) | - | |||||
Net cash used in investing activities | (496,376 | ) | (688,312 | ) | ||||
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 | 3,736,613 | - | ||||||
Proceeds from notes payable | 2,891,520 | 212,800 | ||||||
Payments on notes payable | (737,758 | ) | (86,958 | ) | ||||
Payments of debt issuance costs | (70,000 | ) | - | |||||
Proceeds from line of credit | - | 20,000 | ||||||
Payments on line of credit | - | (300,000 | ) | |||||
Payments on finance lease obligation | (13,034 | ) | (12,487 | ) | ||||
Net cash provided by financing activities | 5,807,341 | 4,030,182 | ||||||
Net increase in cash | 1,290,615 | 546,595 | ||||||
Cash, beginning of period | 373,689 | 194,316 | ||||||
Cash, end of period | $ | 1,664,304 | $ | 740,911 | ||||
Supplemental cash flow information: | ||||||||
Interest paid | $ | 63,152 | $ | 97,147 | ||||
Taxes paid | - | $ | 18,533 | |||||
Non cash financing and investing: | ||||||||
Debt discount notes payable | $ | 115,000 | $ | - | ||||
Debt payment by sale of property and equipment | $ | 1,232,500 | $ | - | ||||
Business acquisition via stock issuance | $ | - | $ | 3,771,978 |
Source:
2020 GlobeNewswire, Inc., source