Contact:
Wayne A. Schellhammer
Chairman & Chief Executive Officer
American CareSource Holdings, Inc.
Tel. 214-596-2400
FOR IMMEDIATE RELEASE
AMERICAN CARESOURCE HOLDINGS
REPORTS YEAR-END FINANCIAL RESULTS
Irving, TX, March 31, 2006 - American CareSource Holdings, Inc. (OTCBB: ACSH.OB)
today announced financial results for its fourth quarter and year ended December
31, 2005. Revenues for the fiscal year 2005 were approximately $4.4 million
compared to approximately $6.0 million last year. The decrease in revenue was
primarily due to the Company redirecting its focus on providing ancillary care
benefit management services to direct payors, Third Party Administrators (TPAs)
and the elimination of contracts that did not support the Company's long-term
business model.
Net loss for the fiscal year 2005 was $2.4 million, or $0.19 per share, compared
to $2.8 million, or $0.23 per share last year. During 2004 there was an $800,000
non cash charge for goodwill impairment, while there was no impairment during
2005.
"We are very proud of our accomplishments during the past year," stated Wayne A.
Schellhammer, Chief Executive Officer and Chairman of the Board for American
CareSource Holdings. "Foremost, through the hard work of our employees, we
expanded our network from 12,000 to over 20,000 sites. In addition, we designed
and implemented a software package that identifies the available cost savings
opportunities for new clients by matching individual claims data on an exact
match basis from the client's claim history, something we believe no other
company in our industry space can do. Our team also completed the design and
implementation of our propriety software to revalue claims automating over 90
percent of our current and future volume. We are well positioned to handle
additional growth and continue to provide exemplary service to which our current
clients are accustomed."
About American CareSource Holdings, Inc.:
American CareSource Holdings, the first national, publicly traded ancillary care
benefit management company, is a comprehensive ancillary care service provider
offering a national network of more than 20,000 ancillary provider sites.
American CareSource Holdings, Inc.'s ancillary network management provides a
complete outsourced solution for a wide variety of healthcare payors and plan
sponsors including self-insured employers, indemnity insurers, PPOs, HMOs, third
party administrators and both the Federal and local governments. Through its
product offerings, American CareSource Holdings, Inc. offers its clients
substantial discounts on services rendered through its network of ancillary care
providers in more than 30 service categories. For more information on American
CareSource, visit www.anci-care.com.
(more)
Page 2
Any statements that are not historical facts contained in this release are
forward-looking statements. It is possible that the assumptions made by
management for purposes of such statements may not materialize. Actual results
may differ materially from those projected or implied in any forward-looking
statements. Such statements may involve risks and uncertainties, including but
not limited to those relating to product demand, pricing, market acceptance, the
effect of economic conditions, and intellectual property rights, and the outcome
of competitive products, risks in product development, the results of financing
effort, the ability to complete transactions, and other risks identified in this
release, and the Securities and Exchange Commission filings of American
CareSource Holdings, Inc.
###
(Tables to Follow)
Page 3
AMERICAN CARESOURCE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2005 AND 2004
2005 2004
---- ----
ASSETS
CURRENT ASSETS
Cash $ 23,399 $ 16,749
Accounts receivable 482,159 460,691
Prepaid and other current assets 30,151 12,795
-------------------------------
Total current assets 535,709 490,235
NET PROPERTY AND EQUIPMENT 175,608 111,780
NET INTANGIBLE ASSETS 1,921,401 2,134,983
GOODWILL 4,361,299 4,361,299
-------------------------------
$ 6,994,017 $ 7,098,297
===============================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Due to service providers $ 386,217 $ 369,553
Accounts payable and other accrued liabilities 352,383 385,899
Payable to Patient Infosystems, Inc. -- 1,651,536
Current maturities of long-term debt 20,231 21,355
-------------------------------
Total current liabilities 758,831 2,428,343
-------------------------------
LONG-TERM DEBT, including $336,277 payable to Patient Infosystems,
Inc. at December 31, 2005 less current maturities 3,845,929 219,325
-------------------------------
STOCKHOLDERS' EQUITY
Common stock, par value $0.01, 40,000,000 shares authorized and
12,371,309 issued and outstanding as of December 31, 2005 and 2004 123,713 123,713
Preferred stock, par value .01, 10,000,000 shares authorized and none
outstanding as of December 31, 2005 and 2004
Additional paid-in-capital 7,734,800 7,158,154
Deferred debt issuance cost (231,500) --
Accumulated (deficit) (5,237,756) (2,831,238)
-------------------------------
Total stockholders' equity 2,389,257 4,450,629
-------------------------------
$ 6,994,017 $ 7,098,297
===============================
Page 4
AMERICAN CARESOURCE HOLDINGS, INC.
SUMMARY INCOME STATEMENT AS OF DECEMBER 31, 2005 AND 2004
2005 2004
---- ----
Revenues:
Ancillary health $ 4,219,133 $ 5,512,927
Patient claims processing 198,313 524,397
----------------------------
Total revenues 4,417,446 6,037,324
Total costs of revenues 4,407,290 5,840,589
----------------------------
Contribution margin 10,156 196,735
----------------------------
Selling, general and administrative expense 1,804,793 1,913,976
Impairment of goodwill -- 802,105
Depreciation and amortization 310,915 295,802
----------------------------
Total operating expenses 2,115,708 3,011,883
----------------------------
Operating (loss) (2,105,552) (2,815,148)
----------------------------
Other expenses:
Interest expense 146,492 12,349
Debt issuance cost 154,474 --
Other -- 3,741
----------------------------
Total other expenses 300,966 16,090
----------------------------
Net (loss) before income tax (2,406,518) (2,831,238)
Income tax expense -- --
----------------------------
Net (Loss) $ (2,406,518) $ (2,831,238)
============================
Net (Loss) per share - basic and diluted $ (0.19) $ (0.23)
Weighted Average Shares Outstanding 12,371,309 12,371,309
============================
Page 5
AMERICAN CARESOURCE HOLDINGS, INC.
STATEMENT OF CASH FLOW AS OF DECEMBER 31, 2005 AND 2004
2005 2004
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) $(2,406,518) $(2,831,238)
Adjustments to reconcile net loss to net cash
(used in) operating activities
Depreciation and amortization 310,915 295,802
Goodwill impairment -- 802,105
Stock option compensation 200,000
Gain on disposal of assets (6,729) --
Amortization of debt issuance costs 145,146 --
Changes in operating assets and liabilities
Accounts receivable (21,468) 25,744
Prepaid and other assets (17,356) 3,147
Due to service providers 16,664 (340,429)
Accounts payable and other accrued liabilitie,s 33,516 (748,426)
-----------------------------
Net cash used in operating activities (1,812,862) (2,793,295)
-----------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment (126,487) (44,995)
Proceeds from sales of equipment 31,656 3,475
Acquisition costs -- (68,093)
-----------------------------
Net cash used in investing activities (94,831) (109,613)
-----------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from line of credit, net 3,250,000 200,000
Proceeds from long term debt 33,727 --
Payments on long term debt (54,125) (293,732)
Change in excess of outstanding checks over bank balance -- (189,608)
Former parent contributions -- 1,549,751
Net (payments to) advances from former parent (1,315,259) 1,651,536
-----------------------------
Net cash provided by financing activities 1,914,343 2,917,947
-----------------------------
Net increase in cash 6,650 15,039
Cash at beginning of year 16,749 1,710
-----------------------------
Cash at end of year $ 23,399 $ 16,749
=============================
SUPPLEMENTAL CASH FLOW INFORMATION, cash paid for interest $ 145,499 $ 21,483
SUPPLEMENTAL DISCLOSURE OF NON-CASH OPERATING AND FINANCIAL
ACTIVIITES
Warrants issued for debt guarantees 376,646 --
Stock option compensation 200,000
Advances from former parent converted to long-term debt 336,227
Acquisition of equipment through capital lease 59,601