Exhibit No. 99.8
Birner Dental Management Services, Inc.
3801 East Florida Avenue, Suite 508
Denver, Colorado 80210
303-691-0680
FOR IMMEDIATE RELEASE
May 11, 2005
BIRNER DENTAL MANAGEMENT SERVICES, INC.
ANNOUNCES 63.1% NET INCOME INCREASE
FOR THE 1Q '05 VERSUS 1Q `04
DENVER, COLORADO, May 11, 2005. Birner Dental Management Services, Inc. (NASDAQ
SmallCap Market: BDMS), operators of PERFECT TEETH dental practices, announced
results for the quarter ended March 31, 2005. The Company reported net income of
$700,000, or $.53 per share of common stock for the quarter ended March 31,
2005, up 63.1% compared to net income of $429,000, or $.33 per share of common
stock for the quarter ended March 31, 2004. Total dental group practice revenue
increased $1.5 million, or 13.0%, to $13.4 million for the quarter ended March
31, 2005 compared to total group practice revenue of $11.8 million for the
quarter ended March 31, 2004. For the quarter ended March 31, 2005, net revenue
increased $1.2 million, or 14.1%, to $9.4 million when compared to net revenue
of $8.2 million for the corresponding period in 2004. The Company's earnings
before interest, taxes depreciation, amortization and discontinued operations
(Adjusted EBITDA) for the quarter ended March 31, 2005 was $1.6 million, up
$309,000, or 23.6%, compared to Adjusted EBITDA of $1.3 million for the quarter
ended March 31, 2004.
During the quarter ended March 31, 2005, the Company repurchased 35,000 shares
of common stock for approximately $669,000 and reduced total debt outstanding by
$366,000. As a result, the Company had total debt outstanding on March 31, 2005
of $880,000. On April 7, 2005, the Company purchased, in a single private
transaction, 63,682 shares of its common stock for $24 per share. This purchase,
of approximately $1.5 million, was financed with the Company's bank line of
credit. Fred Birner, Chief Executive Officer, stated "We are very pleased to
present the Company's results for the first quarter of 2005. The results for
this quarter represent the best in the history of the Company in terms of
revenue, net income, earnings per share and EBITDA. We look forward to continued
success throughout the remainder of 2005."
Birner Dental Management Services, Inc. acquires, develops, and manages
geographically dense dental practice networks in select markets in Colorado, New
Mexico, and Arizona. Currently, the Company manages 56 dental offices, of which
36 were acquired and 20 were de novo developments. The Company operates its
dental offices under the PERFECT TEETH(R) name.
The Company previously announced it would conduct a conference call to review
the quarter ended March 31, 2005 results. In addition to current operating
results, the teleconference may include discussion of management's expectation
of future financial and operating results. The call will be held on Wednesday,
May 11, 2005, at 8:30 a.m. MDT. To participate in this conference call, dial in
to 1-800-946-0741 and refer to "Birner Dental Management Services, Inc."
approximately five minutes prior to the scheduled time. If you are unable to
join in on the conference call on May 11th, the rebroadcast number is
1-888-203-1112 with the pass code of 4771791. This rebroadcast will be available
through May 25, 2005.
Certain of the matters discussed herein may contain forward-looking statements
that are subject to certain risks and uncertainties that could cause actual
results to differ materially from expectations. These include statements
regarding the Company's growth prospects and performance in 2005 and other
future periods. These and other risks are set forth in the reports filed by the
Company with the Securities and Exchange Commission.
For Further Information Contact:
Birner Dental Management Services, Inc.
Dennis Genty
Chief Financial Officer
(303) 691-0680
BIRNER DENTAL MANAGEMENT SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Quarters Ended March 31,
-------------------------------------
2004 2005
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NET REVENUE (a) $ 8,210,196 $ 9,367,731
DIRECT EXPENSES:
Clinical salaries and benefits 3,029,606 3,486,150
Dental supplies 462,424 533,338
Laboratory fees 628,638 628,496
Occupancy 875,148 960,216
Advertising and marketing 146,088 259,442
Depreciation and amortization 467,741 424,372
General and administrative 939,541 980,113
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6,549,186 7,272,127
_________
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Contribution from dental offices 1,661,010 2,095,604
CORPORATE EXPENSES:
General and administrative 818,089 900,488
Depreciation and amortization 56,597 36,674
----------- -----------
Operating income 786,324 1,158,442
Interest expense (income), net 26,102 (7,632)
----------- -----------
Income from continuing operations
before income taxes 760,222 1,166,074
Income tax expense (304,089) (466,431)
----------- -----------
Income from continuing operations 456,133 699,643
DISCONTINUED OPERATIONS
Operating (loss) attributable to assets disposed of (45,195) -
Income tax benefit 18,078 -
----------- ----------
Loss on discontinued operations (27,117) -
----------- ----------
Net income $ 429,016 $ 699,643
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Net income per share of Common Stock - Basic:
Continuing operations $ .38 $ .59
Discontinued operations (.02) -
--------- ---------
Net income per share of Common Stock - Basic $ .36 $ .59
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Net income per share of Common Stock - Diluted:
Continuing operations $ .35 $ .53
Discontinued operations (.02) -
--------- ---------
Net income per share of Common Stock - Diluted $ .33 $ .53
========= =========
Weighted average number of shares of Common Stock
and dilutive securities:
Basic 1,188,651 1,190,098
========= =========
Diluted 1,296,610 1,310,523
========= =========
a) Total dental group practice revenue less amounts retained by group
practices. Dental practice revenue was $13,350,407 for the three months
ended March 31, 2005 compared to $11,809,840 for the three months ended
March 31, 2004.
BIRNER DENTAL MANAGEMENT SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, March 31,
ASSETS 2004 2005
-------------- ------------
CURRENT ASSETS:
Cash and cash equivalents $ 756,181 $ 1,060,934
Accounts receivable, net of allowance for doubtful accounts
of $232,543 and $227,347, respectively 2,976,186 3,699,019
Deferred tax asset 135,826 135,826
Income tax receivable 80,318 -
Prepaid expenses and other assets 800,671 708,097
----------- -----------
Total current assets 4,749,182 5,603,876
PROPERTY AND EQUIPMENT, net 3,164,124 3,109,072
OTHER NONCURRENT ASSETS:
Intangible assets, net 13,787,093 13,599,483
Deferred charges and other assets 159,440 158,558
----------- -----------
Total assets $21,859,839 $22,470,989
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 4,637,927 $ 5,335,314
Income taxes payable - 386,113
Current maturities of long-term debt 167,217 170,537
----------- -----------
Total current liabilities 4,805,144 5,891,964
LONG-TERM LIABILITIES:
Deferred tax liability, net 670,893 670,893
Long-term debt, net of current maturities 1,078,711 709,745
Other long-term obligations 176,741 176,101
----------- -----------
Total liabilities 6,731,489 7,448,703
SHAREHOLDERS' EQUITY:
Preferred Stock, no par value, 10,000,000 shares
authorized; none outstanding - -
Common Stock, no par value, 20,000,000 shares
authorized; 1,203,511 and 1,208,510 shares issued and
outstanding, respectively 12,125,811 11,557,072
Retained earnings 3,002,539 3,465,214
----------- -----------
Total shareholders' equity 15,128,350 15,022,286
----------- -----------
Total liabilities and shareholders' equity $21,859,839 $22,470,989
=========== ===========
Although Adjusted EBITDA is not a generally accepted accounting principles
measure of performance or liquidity, the Company believes that it may be useful
to an investor in evaluating its performance. However, investors should not
consider this measure in isolation or as a substitute for operating income, cash
flows from operating activities or any other measure for determining the
Company's operating performance or liquidity that is calculated in accordance
with generally accepted accounting principles. In addition, because Adjusted
EBITDA is not calculated in accordance with generally accepted accounting
principles, it may not necessarily be comparable to similarly titled measures
employed by other companies. A reconciliation of Adjusted EBITDA can be made by
adding Discontinued operations (before income tax expense), Depreciation and
amortization - Offices, Depreciation and amortization - Corporate, Interest
expense, net and Income tax expense to Net income as in the table below.
Quarters Ended
March 31,
-----------------------------
2004 2005
---- ----
RECONCILIATION OF Adjusted EBITDA:
Net income $ 429,016 $ 699,643
Discontinued operations -
(before income tax expense) 45,195 -
Depreciation and amortization - Offices 467,741 424,372
Depreciation and amortization - Corporate 56,597 36,674
Interest expense, net 26,102 (7,632)
Income tax expense 286,011 466,431
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Adjusted EBITDA $ 1,310,662 $ 1,619,488
=========== ===========
Total dental group practice revenue is the revenue generated at the Company's
offices from professional services provided to its patients. Amounts retained by
group practices represents compensation expense to the dentists and hygienists
and is subtracted from total dental group practice revenue to arrive at net
revenue. The Company reports net revenue in its financial statements to comply
with Emerging Issues Task Force Issue No. 97-2, Application of SFAS No. 94
(Consolidation of All Majority Owned Subsidiaries) and APB Opinion No. 16
(Business Combinations) to Physician Practice Management Entities and Certain
Other Entities With Contractual Management Arrangements. Total dental group
practice revenue is disclosed because it is a critical component for
management's evaluation of office performance. However, investors should not
consider this measure in isolation or as a substitute for operating income, cash
flows from operating activities or any other measure for determining the
Company's operating performance or liquidity that is calculated in accordance
with generally accepted accounting principles.
Quarters Ended
March 31,
-----------------------------
2004 2005
---------------- ------------
Total dental group practice revenue $ 11,809,840 $ 13,350,407
Amounts retained by group practices (3,599,644) (3,982,676)
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Net revenue $ 8,210,196 $ 9,367,731
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