Exhibit 99
PHC, INC. ANNOUNCES RECORD FISCAL 2005
FIRST QUARTER FINANCIAL RESULTS
Most Profitable Quarter in Company History
FOR IMMEDIATE RELEASE
Company Contact: Investor Relations Contact:
____________________ _______________________________
PHC, Inc. Hayden Communications, Inc.
Bruce A. Shear Matthew Hayden
978-536-2777 843-272-4653
>> RECORD FIRST QUARTER REVENUE OF $8.0 MILLION VS. $6.1 MILLION
>> RECORD EARNINGS OF $775,628 OR $0.04 PER SHARE, VS. $53,149 OR $.00 PER SHARE
>> Q1 PHARMACEUTICAL STUDIES REVENUE EQUALS 87% OF FULL YEAR 2004
>> Q1 NON-PATIENT OPERATIONS REVENUE INCREASED 92%
>> SHAREHOLDERS EQUITY INCREASED 15% TO $6.1 MILLION
PEABODY, Mass., November 10, 2004 -- PHC, Inc., d.b.a. Pioneer Behavioral Health
(OTC Bulletin Board: PIHC), a leading provider of inpatient and outpatient
behavioral health services and Pharmaceutical Research, today announced its
fiscal 2005 first quarter financial results, for the quarter ended September 30,
2004.
Revenues for the first quarter increased 30.4 percent to a record $8.0 million
from the $6.1 million reported in the first quarter of fiscal 2004, due to
substantial increases in revenue from both the patient care and pharmaceutical
study segments. Net patient care revenue increased 19.6 percent to $6.2 million
for the first quarter from $5.2 million for the first quarter of last year due
to an 11 percent increase in census at PHC's inpatient facilities. Revenue from
pharmaceutical studies related to the acquisition of Pivotal Research Centers,
LLC -- increased more than seven-fold to $1.1 million compared to the same
period last year, and equaled almost the entire revenue of $1.2 million reported
for fiscal 2004. Contract support services revenue provided by the Company's
Wellplace division decreased 13.8 percent to $661,426 for the quarter from
$767,125 for the first quarter of last year, due to the expiration of the
Nebraska smoking cessation contract which was not renewed.
Total operating expenses for the quarter increased to $7.1 million from $5.9
million last year. Income from operations for the quarter was $884,835, a nearly
five-fold increase from the $179,546 reported in the first quarter last year.
Net income applicable to common shareholders for the three months was a record
$775,628, or $0.04 per diluted share, up from $53,149, or $0.00 per diluted
share for the first quarter of fiscal 2004. This was the Company's 15th
consecutive quarter of operating profitability, with the exception of the
previously reported litigation settlement and related legal costs.
Bruce A. Shear, Pioneer's President and Chief Executive Officer, commented, "The
record performance validates the strategic decisions we have made in the last
two years, focusing on our core competencies and growing through strategic
acquisitions. Without revenue from our expansion at the Detroit Medical Center
during this quarter, the Company still delivered 30 percent top-line growth and
record profitability. The expected contributions from the DMC beds will provide
incremental revenue opportunities that compliment the growth we are seeing from
our other operating segments. Our Pivotal Research operation demonstrated
impressive growth, surpassing the internal expectations which we established
when the Pivotal operations were merged with our existing pharmaceutical
research operations. In fact, in the first quarter alone we reported 87 percent
of the revenue this segment reported for all of last year. We look forward to
continued growth and improved profitability for the remainder of this fiscal
year."
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Other operational highlights include:
o Pioneer opened the first 30 beds at Detroit Behavioral Institute in leased
space at the Detroit Medical Center. The Company also received its Michigan
state approval for the final 54 acute beds completing the necessary steps
to open all 114 beds. Alexander Luvall, who joined the Company during
September as Executive Vice President, will oversee the facility and ensure
a smooth commencement of operations.
o On October 20, Pioneer announced it had secured an expanded line of credit,
secured with its accounts receivables, totaling $3.5 million. The line of
credit is provided by CapitalSource Finance LLC, and replaces Pioneer's
former bank.
The Company's balance sheet continued to strengthen with a current ratio of
1.26:1 on September 30, 2004. Subsequent to quarter end and reflected in this
ratio is the term loan in the amount of $1.4 million and an accounts receivable
funding revolving credit agreement with a maximum loan amount of $3.5 million,
including $900,000 available as an overline for growth. The loan and credit line
are held by CapitalSource Finance, LLC. This represents a higher credit line,
with more favorable terms than the Company's previous bank line. Shareholders'
equity increased 15 percent to $6.1 million on September 30, 2004 from $5.4
million on June 30, 2004. The decrease in the Company's cash position is
primarily due to the increase in accounts receivable from current revenue and
the capital expenditures on the expanding Michigan operations.
About Pioneer Behavioral Health
Pioneer Behavioral Health operates companies that provide inpatient and
outpatient behavioral health care services, clinical research and Internet- and
telephonic-based referral services. The companies contract with national
insurance companies, government payors, and major transportation and gaming
companies, among others, to provide such services. For more information, please
visit www.phc-inc.com or www.haydenir.com.
Statement under the Private Securities Litigation Reform Act of 1995: This press
release may include "forward-looking statements" that are subject to risks and
uncertainties. Forward-looking statements include information about possible or
assumed future results of the operations or the performance of the company and
its future plans and objectives. Various future events or factors may cause the
actual results to vary materially from those expressed in any forward-looking
statements made in this press release. For a discussion of these factors and
risks, see the company's annual report on Form 10-KSB for the most recently
ended fiscal year.
- tables follow -
PHC, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
FOR THE
THREE MONTHS
ENDED
__________________________________
09/30/04 09/30/03
Total Revenue $7,957,515 $6,103,167
Net Income
Operations 884,835 179,546
Net Income 775,628 53,149
Basic Earnings Per Share 0.04 0.00
Diluted EarningsPer Share 0.04 0.00
Basic Shares Outstanding 17,360,604 14,069,204
Diluted Shares Outstanding 18,155,364 14,789,056
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BALANCE SHEET HIGHLIGHTS
As of 9/30/04 As of 06/30/2004
_______________ ________________
Cash and cash equivalents $ 156,959 $ 594,823
Total Current Assets 8,681,569 7,631,516
Net Property and Equipment 1,539,754 1,353,975
Total Assets $14,597,743 $13,311,569
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Total Current Liabilities $ 6,902,171 $ 7,390,661
Total Long Term Debt 1,525,994 529,378
Total Liabilities $ 8,450,432 $ 7,944,532
____________ ____________
Shareholders' Equity $ 6,147,311 $ 5,367,037
Total Liabilities and Equity $14,597,743 $ 13,311,569
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