AdCare Health Systems, Inc. Continues To Be Profitable; Reports 2009 Second Quarter Earning Results

Friday, September 18, 2009 General News
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SPRINGFIELD, Ohio, Aug. 14 AdCare Health Systems, Inc. (NYSE AMEX: ADK), an Ohio based long term care, home care and management company, today reported financial results for its second quarter of 2009.

Revenues for the quarter ended June 30, 2009 were $6,613,127 as compared to $6,016,536 for the same quarter in 2008, an increase of $596,591. The increase was mostly due to improved occupancy in our skilled nursing centers and enhanced revenues in our home health care division. Management will continue to focus on expanding the revenue base at its home health care operations.

The net income for the quarter ended June 30, 2009 was $147,101 as compared to $22,963 for the second quarter ended June 30, 2008, an improvement of $124,138. The improvement in net income would have been significantly higher without the $413,593 gain on the acquisition of the Lincoln Lodge in the second quarter of last year. Basic and diluted net income per share for the quarter ended June 30, 2009 was $0.04 as compared to a basic and diluted net income per share of $0.01 for the same quarter ended June 30, 2008.

Revenues for the six-months ended June 30, 2009 were $12,998,016 as compared to $12,009,078 for the same period in 2008, an increase of $988,938. Net income for the six-months ended June 30, 2009 was $242,915 as compared to a loss of $116,507 for the same period in 2007, an improvement of $359,422. Again, the increase was due mostly to improved occupancy in our skilled nursing centers and assisted living facilities as well as improved revenues in our home health care division. Basic and diluted net income per share for the six-months ended June 30, 2009 was $0.07 as compared to a basic and diluted net loss per share of ($0.02) for the same six-months period ended June 30, 2008.

David A. Tenwick, Chairman of AdCare, stated that "I am extremely encouraged that the Company is moving in the right direction and profitability continues to improve despite the challenging economic environment." He continued, "The Company has made great strides in improving its financial performance. I am especially pleased with the improvement in income from Operations for the first six months of 2009, increasing to $931,286 from $154,801 for the same period last year. In addition, we continued to improve our working capital position by $815,324, since the end of last year with current assets now $275,302 more than current liabilities." He added that "AdCare is still seeking attractive acquisitions and business opportunities in the health care field that have the potential to expand our operations."

About AdCare Health Systems, Inc.

AdCare Health Systems, Inc. (Amex: ADK) develops, owns and manages assisted living facilities, nursing homes and retirement communities and provides home health care services. Prior to becoming a publicly traded company in November of 2006, AdCare operated as a private company for 18 years. AdCare's 900 employees provide high-quality care for patients and residents residing in the 14 facilities that they manage, six of which are assisted living facilities, six skilled nursing centers and two independent senior living communities. The Company has ownership interests in eight of those facilities. In the ever expanding marketplace of long term care, AdCare's mission is to provide quality healthcare services to the elderly.

Safe Harbor Statement

Statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of federal law. Such forward-looking statements reflect management's beliefs and assumptions and are based on information currently available to management. The forward-looking statements involve known and unknown risks, results, performance or achievements of the Company to differ materially from those expressed or implied in such statements. Such factors are identified in the public filings made by the Company with the Securities and Exchange Commission and include the Company's ability to secure lines of credit and/or an acquisition credit facility, find suitable acquisition properties at favorable terms, changes in the health care industry because of political and economic influences, changes in regulations governing the industry, changes in reimbursement levels including those under the Medicare and Medicaid programs and changes in the competitive marketplace. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements.

ADCARE HEALTH SYSTEMS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET June 30, December 31, 2009 2008 ---- ---- ASSETS (Unaudited) ------ Current Assets: Cash $1,808,604 $1,266,315 Accounts receivable: Long-term care resident receivables, net 1,965,901 2,008,847 Management, consulting and development receivables, net 167,900 258,811 Advances and receivables from affiliates 16,407 17,635 Prepaid expenses and other 537,277 478,534 Total current assets 4,496,089 4,030,142 --------- --------- Restricted cash 1,176,960 1,155,596 Property and equipment, net 16,462,360 16,772,660 License, net 1,189,307 1,189,307 Goodwill 2,679,482 2,679,482 Other assets 906,269 1,012,340 ------- --------- Total assets $26,910,467 $26,839,527 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY ------------------------------------ Current Liabilities: Current portion of notes payable and other debt $729,157 $713,323 Current portion of notes payable to stockholder 9,432 9,432 Accounts payable 875,325 1,009,002 Accrued expenses 2,606,873 2,838,407 --------- --------- Total current liabilities 4,220,787 4,570,164 --------- --------- Notes payable and other debt, net of current portion 16,645,776 16,974,788 Notes payable to stockholder, net of current portion 30,623 34,626 Other liabilities 695,229 299,314 Income tax payable 191,291 170,007 Total liabilities 21,783,705 22,048,899 Stockholders' equity: Preferred stock, no par value; 500,000 shares authorized; no shares issued or outstanding - - Common stock and additional paid-in capital, no par value; 14,500,000 shares authorized; 3,786,129 shares issued and outstanding 14,835,191 14,766,967 Accumulated deficit (10,002,617) (10,245,532) ----------- ------------ Total stockholders' equity 4,832,574 4,521,435 Noncontrolling interest in subsidiaries 294,188 269,193 ------- ------- Total equity 5,126,762 4,790,628 --------- --------- Total liabilities and stockholders' equity $26,910,467 $26,839,527 =========== =========== See notes to consolidated financial statements.

SOURCE AdCare Health Systems, Inc.

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