American Shared Hospital Services(AMS) - 2024 Q1 - Quarterly Report

Part I – Financial Information Item 1. Financial Statements The unaudited condensed consolidated financial statements detail the company's financial position and performance as of March 31, 2024 Condensed Consolidated Balance Sheets Balance Sheet Summary (as of March 31, 2024 vs. December 31, 2023) | Metric | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total Assets | $50,124,000 | $48,162,000 | | Cash and cash equivalents | $12,792,000 | $13,690,000 | | Property and equipment, net | $26,879,000 | $25,844,000 | | Total Liabilities | $23,739,000 | $21,883,000 | | Long-term debt, net | $15,602,000 | $13,125,000 | | Total Shareholders' Equity | $26,385,000 | $26,279,000 | Condensed Consolidated Statements of Operations Statement of Operations Summary (Three Months Ended March 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenues | $5,216,000 | $4,925,000 | | Gross Margin | $2,143,000 | $1,908,000 | | Operating (Loss) Income | ($85,000) | $98,000 | | Net Income Attributable to ASHS | $119,000 | $188,000 | | Diluted EPS | $0.02 | $0.03 | Condensed Consolidated Statements of Cash Flows Cash Flow Summary (Three Months Ended March 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($1,865,000) | $1,761,000 | | Net cash used in investing activities | ($1,183,000) | ($209,000) | | Net cash provided by (used in) financing activities | $2,282,000 | ($804,000) | | Net change in cash | ($766,000) | $748,000 | | Cash, cash equivalents, and restricted cash at end of period | $13,042,000 | $13,201,000 | Notes to Condensed Consolidated Financial Statements - The company operates under two reportable segments: 'leasing' (Gamma Knife and PBRT equipment) and 'retail' (direct facility ownership)[30] - On May 7, 2024, the company acquired a 60% interest in two Rhode Island cancer centers from GenesisCare for $2.85 million[21][69] - A new $2.7 million Supplemental Term Loan was secured on January 25, 2024, to finance capital expenditures in Mexico[39] - As of March 31, 2024, the company had equipment purchase commitments of $13.752 million and service commitments of $14.120 million[60][61][63] Segment Revenue and Net Income (Three Months Ended March 31, 2024) | Segment | Revenue | Net Income (Loss) Attributable to ASHS | | :--- | :--- | :--- | | Leasing | $4,253,000 | $201,000 | | Retail | $963,000 | ($82,000) | | Total | $5,216,000 | $119,000 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management analyzes Q1 2024 performance, noting revenue growth offset by higher expenses and a decline in net income First Quarter 2024 Results Q1 2024 vs Q1 2023 Performance | Metric | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $5,216,000 | $4,925,000 | +5.9% | | PBRT Revenue | $2,649,000 | $2,314,000 | +14.5% | | Gamma Knife Revenue | $2,567,000 | $2,611,000 | -1.7% | | Net Income (to ASHS) | $119,000 | $188,000 | -36.7% | - The 5.9% increase in total revenue was driven by higher PBRT reimbursement and increased international retail volumes[87][88] - Selling and administrative expenses rose by $340,000, largely due to $377,000 in fees for new business opportunities[92] - Gamma Knife procedures decreased by 20 to 273 due to expired contracts; excluding these, procedures increased by 4%[89] Liquidity and Capital Resources - The company's cash, cash equivalents, and restricted cash decreased by $766,000 during Q1 2024 to $13.042 million[96] - Working capital increased by $909,000 to $10.586 million at March 31, 2024, compared to year-end 2023[97] - Total long-term debt stood at $15.602 million as of March 31, 2024, with the company in compliance with all debt covenants[101][103] - The company has commitments of $13.752 million for new equipment, intending to finance these purchases with cash and a $7.0 million revolving line of credit[104] Item 3. Quantitative and Qualitative Disclosures about Market Risk The company's primary market risk is interest rate fluctuation on its floating-rate debt, with no derivative instruments held - The company does not use derivative instruments and had no significant long-term, market-sensitive investments at the end of the quarter[111] Item 4. Controls and Procedures Management concluded that disclosure controls and internal controls over financial reporting were effective as of March 31, 2024 - Management concluded that as of March 31, 2024, the company's disclosure controls and procedures were effective[113] - No material changes in internal control over financial reporting occurred during the quarter[114] Part II - Other Information Item 1A. Risk Factors New risks are identified concerning the integration and potential hidden liabilities of the recent Rhode Island acquisition - A new risk factor is the potential difficulty in assimilating the newly acquired RI Target Companies, which could divert management attention[117] - The company acknowledges the risk that its due diligence may not have revealed all material liabilities associated with the RI Acquisition[118][119] Other Part II Items The company reports no legal proceedings, unregistered equity sales, or defaults upon senior securities for the quarter - The company reported no legal proceedings for the period[116] - No unregistered sales of equity securities or defaults upon senior securities occurred[120] Item 6. Exhibit Index This section lists all exhibits filed with the report, including acquisition agreements and officer certifications - Exhibits filed include amendments to the Investment Agreement with GenesisCare and officer certifications pursuant to the Sarbanes-Oxley Act[123]