Exhibit 99
PHC, INC. ANNOUNCES RECORD FISCAL 2005
SECOND QUARTER FINANCIAL RESULTS
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 SECOND QUARTER REVENUE OF $8.1 MILLION VS. $6.5 MILLION
>> RECORD SECOND QUARTER EARNINGS OF $408,804 OR $0.02 PER SHARE, VS. $2,659
OR $0.00 PER SHARE
>> SIX-MONTH REVENUES INCREASE 27% VS. YEAR AGO PERIOD; SIX-MONTH EPS OF $0.07
VS. $0.00 LAST YEAR
>> SHAREHOLDERS EQUITY INCREASED 27% TO $6.8 MILLION FROM JUNE 30, 2004 TO
DECEMBER 31, 2004.
>> Q2 PHARMACEUTICAL STUDIES REVENUE EQUALS NEARLY ALL OF FULL FISCAL YEAR
2004
Peabody, Mass., February 9, 2005 -- 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
financial results for its fiscal 2005 second quarter and six-month period ended
December 31, 2004.
Total revenues for the second quarter increased approximately 24 percent to a
record $8.1 million from the $6.5 million reported in the second quarter of
fiscal 2004, due to substantial increases in revenue from both the patient care
and pharmaceutical study segments. Net patient care revenue increased
approximately 7.0 percent to $6.0 million for the second quarter from $5.5
million for the second quarter of last year due to an increase in patient days
at the Company's in-patient substance abuse facilities. Revenue from
pharmaceutical studies related to the acquisition of Pivotal Research Centers,
LLC (Pivotal), increased nearly five-fold to $1.19 million compared to $201,000
reported in the year ago period and nearly equaled the entire revenue of $1.20
million reported for fiscal 2004, which included only two months of contribution
from Pivotal. Contract support services revenue provided by the Company's
Wellplace division increased 24.8 percent to $923,323 for the quarter from
$740,014 for the second quarter of last year.
Total operating expenses for the quarter increased to $7.4 million from $6.4
million last year. Income from operations for the quarter was $679,895, a
substantial increase from the $77,821 reported in the second quarter last year.
Net income applicable to common shareholders for the three months was a record
$408,804, or $0.02 per diluted share, up from $2,659, or $0.00 per basic share
for the second quarter of fiscal 2004. This was the Company's 16th 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, "I'm
pleased to report record performance for the third quarter in a row, further
validating the strategic decisions made in the past year. We have clearly
demonstrated the ability to grow our top and bottom line both organically and
through strategic acquisitions. We began to see revenue contribution from our
Detroit Behavioral Institute division (DBI) during this quarter, which enhanced
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our revenue growth and helped fuel a record quarter. The first 30-bed unit is
now operating profitably. I am particularly pleased that we reported significant
increases in our profitability, despite the inclusion of substantial start-up
expenses related to DBI's opening. Our Pivotal division continued to show
tremendous growth, demonstrating the full potential we envisioned when making
this acquisition last year. We are well positioned to continue this positive
trend throughout the balance of this fiscal year, and we look forward to
continued growth and profitability from DBI and Pivotal."
For the first six months of fiscal 2004, total revenues increased approximately
27 percent to $16.0 million from the $12.6 million reported for the first six
months of fiscal 2004. Net patient care revenue increased approximately 13
percent to $12.1 million for the first six months, from $10.7 million last year,
due to an increase in patient days at the Company's in-patient substance abuse
facilities. Revenue from pharmaceutical studies related to the acquisition of
Pivotal, increased to $2.3 million compared to $344,892 reported in the year ago
period and compared to $1.2 million reported for all of fiscal 2004. Contract
support services revenue provided by Wellplace increased approximately 5 percent
to $1.6 million for the first six months of fiscal 2005 from $1.5 million for
the six months last year.
Total operating expenses for the six-month period increased to $14.5 million
from $12.3 million last year. Income from operations for the six-month period
was $1.6 million, a significant increase from the $257,367 reported last year.
Net income applicable to common shareholders for the six months was a record
$1.2 million, or $0.07 per basic share, up from $55,808, or $0.00 per diluted
share for the same period last year.
Other operational highlights include:
o As previously announced, Wellplace received a $998,000 expansion of the
Company's contract with the Detroit-Wayne County (Michigan) Community
Mental Health Agency, for the period from October 1, 2004 through September
30, 2005. As part of the agreement, the Company will offer additional
services related to the $1.8 million annual contract to provide 24-hours /
365-days-per year mental health information and referral services through
both the telephone and Internet.
o DBI completed the second quarter with 30 beds in operation. Renovations to
open the next 20 beds will begin this quarter.
o Pivotal is currently involved in 24 enrolling studies and providing care
under 58 studies.
The Company's balance sheet continued to strengthen with a current ratio of
1.25:1 on December 31, 2004. Shareholders' equity increased 27 percent to $6.8
million on December 31, 2004 from $5.4 million on June 30, 2004.
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.
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PHC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
December 31, December 31,
2004 2003 2004 2003
____________________________________________________
Total revenues $8,069,201 $6,488,828 $16,026,716 $12,591,995
Total operating expenses 7,389,306 6,411,007 14,461,986 12,334,628
__________ __________ ___________ ___________
Income from operations 679,895 77,821 1,564,730 257,367
__________ __________ ___________ ___________
Income before provision for taxes 481,273 3,780 1,282,901 66,929
Provision for income taxes 72,469 1,121 98,469 11,121
__________ __________ ___________ ___________
Net income applicable to common
Shareholders $ 408,804 $ 2,659 $ 1,184,432 $ 55,808
========== ========== =========== ===========
Basic net income per common Share $ 0.02 $ 0.00 $ 0.07 $ 0.00
========== ========== =========== ===========
Basic weighted average number of
shares outstanding 17,417,238 14,043,665 17,388,921 14,038,877
========== ========== =========== ===========
Fully diluted net income per common
share $ .02 $ 0.00 $ 0.06 $ 0.00
========== ========== =========== ===========
Fully diluted weighted average number
of shares outstanding 18,471,375 14,921,550 18,274,631 14,804,158
========== ========== =========== ===========
BALANCE SHEET HIGHLIGHTS
As of 12/31/04 As of 6/30/04
______________ _____________
Cash $ 181,233 $ 594,823
Total Current Assets 9,135,233 7,631,516
Net Property and Equipment 1,513,182 1,353,975
____________ ___________
Total Assets $16,338,516 $13,311,569
============ ===========
Total Current Liabilities $ 7,316,739 $ 7,390,661
Total Long Term Debt 2,203,526 529,378
____________ ___________
Total Liabilities 9,538,557 7,944,532
Shareholders' Equity 6,799,959 5,367,037
____________ ___________
Total Liabilities and Equity $16,338,516 $13,311,569
============ ============
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