SUN VALLEY, Calif., Nov. 4, 2010 (GLOBE NEWSWIRE) -- Emergent Group Inc. (NYSE Amex:LZR), a leading provider of mobile medical lasers and surgical equipment, announced the following financial results for the third quarter ended September 30, 2010:
- Revenue decreased 4.8% to $7,594,715 versus $7,981,464 for the prior year's third quarter ended September 30, 2009 as the company noted continued softness in demand for medical procedures and related services affecting various healthcare sectors. However, third quarter revenue was 4.8% higher than the second quarter of 2010. This compared to sequential revenue growth of 2.5% between the second and third quarters of 2009.
- EBITDA (earnings before interest, taxes, depreciation and amortization) declined 8.7% to $1,919,041 versus $2,101,177 for the prior year period.
- Net income decreased 14.5% to $710,036, or $0.10 per diluted share, for the third quarter of 2010, versus $830,656, or $0.12 per diluted share, in the prior year period. Diluted weighted-average shares outstanding were lower in the current quarter at 7,045,049 versus 7,089,598 for the prior year period.
- At the end of the quarter, the company had a cash balance of $7,283,073, amounting to $1.03 per diluted share.
"With Emergent Group's strong position in the marketplace and our strategic focus on sales," said Chairman and CEO Bruce J. Haber, "we were pleased to see sequential revenue growth between the second and third quarters despite the persistent softness that various healthcare sectors have experienced in overall demand for medical products and services. Although the economic downturn has caused some Americans to lose health insurance or postpone certain medical procedures, we continue to believe that not all such procedures can be delayed indefinitely. Thus, we have confidence that the current softness is a short-term phenomenon and we look forward to a recovery in the near future."
"Furthermore," Haber added, "we know that Emergent Group's business model remains attractive in the current economic climate as rentals allow our hospital and physician practice customers to conserve cash and still embrace the latest technologies. Rentals also give equipment manufacturers opportunities to partner with us and thereby extend their distribution channels beyond the typically long sales cycles. Thus, our strategic position and value proposition bode well for the future of Emergent Group."
The company reported the following financial results for the nine months ended September 30, 2010:
- Revenue decreased 3.9% to $22,214,727 versus $23,105,272 for the prior year period ended September 30, 2009.
- EBITDA (earnings before interest, taxes, depreciation and amortization) declined 0.4% to $6,030,693 versus $6,055,785 for the prior year period.
- Net income decreased 5.1% to $2,276,244, or $0.32 per diluted share, for the first nine months of 2010, versus $2,398,919, or $0.34 per diluted share, in the prior year period. Diluted weighted-average shares outstanding were slightly lower for the latest nine months at 7,020,315 versus 7,059,774 for the prior year period.
About Emergent Group Inc.
Emergent Group Inc., through its wholly owned subsidiary, PRI Medical Technologies, Inc. ("PRI Medical"), provides mobile medical laser and surgical equipment in 16 states on a per-procedure basis to hospitals, outpatient surgery centers and physicians' offices. Surgical equipment is provided to customers along with technical support personnel to ensure that such equipment is operating correctly. PRI Medical currently offers its services in five states in the western United States and 11 states along the eastern seaboard. Emergent Group Inc. is a member of the Russell Microcap® Index. For investor and product information, visit Emergent Group's website, www.emergentgroupinc.com.
Forward-Looking Statements
Statements in this news release may contain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1993 and Section 21E of the Securities Exchange Act of 1934. Such statements may involve various risks and uncertainties, some of which may be discussed in the Company's most recent report on Form 10-K and subsequently filed SEC reports. There is no assurance any forward-looking statements will prove accurate, as actual results and future events could differ materially from those presently anticipated.
| Emergent Group Inc. and Subsidiaries | ||
| Condensed Consolidated Balance Sheets | ||
| September 30, | December 31, | |
| 2010 | 2009 | |
| ASSETS | (Unaudited) | |
| Current assets | ||
| Cash | $ 7,283,073 | $ 7,427,165 |
| Accounts receivable, net of allowance for doubtful | ||
| accounts of $98,909 and $83,704 | 3,803,026 | 4,006,123 |
| Inventory, net | 1,130,668 | 889,526 |
| Prepaid expenses | 299,523 | 380,825 |
| Deferred income taxes | 257,630 | 557,630 |
| Total current assets | 12,773,920 | 13,261,269 |
| Property and equipment, net of accumulated depreciation and | ||
| amortization of $10,304,504 and $9,031,136 | 4,681,577 | 5,545,492 |
| Goodwill | 1,120,058 | 1,120,058 |
| Deferred income taxes | 21,126 | 21,126 |
| Other intangible assets, net of accumulated amortization of | ||
| $372,373 and $300,672 | 393,564 | 455,265 |
| Deposits and other assets | 82,671 | 80,992 |
| Total assets | $ 19,072,916 | $ 20,484,202 |
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||
| Current liabilities | ||
| Current portion of capital lease obligations | $ 1,834,276 | $ 1,901,272 |
| Dividends payable | -- | 2,710,817 |
| Accounts payable | 1,671,098 | 1,440,122 |
| Accrued expenses and other liabilities | 2,010,296 | 2,456,315 |
| Total current liabilities | 5,515,670 | 8,508,526 |
| Capital lease obligations, net of current portion | 1,872,710 | 2,670,942 |
| Total liabilities | 7,388,380 | 11,179,468 |
| Shareholders' equity | ||
| Preferred stock, $0.001 par value, non-voting 10,000,000 | ||
| shares authorized, no shares issued and outstanding | -- | -- |
| Common stock, $0.04 par value, 100,000,000 shares authorized | ||
| 6,897,024 and 6,776,118 shares issued and outstanding | 275,877 | 271,042 |
| Additional paid-in capital | 16,753,421 | 16,507,958 |
| Accumulated deficit | (5,786,081) | (8,062,324) |
| Total Emergent Group equity | 11,243,217 | 8,716,676 |
| Non-controlling interest | 441,319 | 588,058 |
| Total shareholders' equity | 11,684,536 | 9,304,734 |
| Total liabilities and shareholders' equity | $ 19,072,916 | $ 20,484,202 |
| Emergent Group Inc. and Subsidiaries | ||||
| Condensed Consolidated Statements of Income | ||||
| (Unaudited) | ||||
| Three Months Ended | Nine Months Ended | |||
| September 30, | September 30, | |||
| 2010 | 2009 | 2010 | 2009 | |
| Revenue | $ 7,594,715 | $ 7,981,464 | $ 22,214,727 | $ 23,105,272 |
| Cost of goods sold | 4,607,609 | 4,802,495 | 13,465,898 | 13,839,056 |
| Gross profit | 2,987,106 | 3,178,969 | 8,748,829 | 9,266,216 |
| Selling, general, and administrative expenses | 1,566,503 | 1,490,174 | 4,522,235 | 4,442,338 |
| Income from operations | 1,420,603 | 1,688,795 | 4,226,594 | 4,823,878 |
| Other income (expense) | ||||
| Interest expense, net | (64,410) | (85,692) | (210,496) | (261,681) |
| Gain on disposal of property and equipment | -- | 5,500 | 64,323 | 8,050 |
| Other income from affiliated entities, net | -- | -- | 190,221 | -- |
| Other income, net | 978 | 76 | 1,923 | 30,336 |
| Total other income (expense) | (63,432) | (80,116) | 45,971 | (223,295) |
| Income before provision for income taxes and | ||||
| non-controlling interest | 1,357,171 | 1,608,679 | 4,272,565 | 4,600,583 |
| Provision for income taxes | (472,755) | (553,000) | (1,550,044) | (1,604,634) |
| Income before non-controlling interest | 884,416 | 1,055,679 | 2,722,521 | 2,995,949 |
| Non-controlling interests in income of | ||||
| consolidated limited liability companies | (174,380) | (225,023) | (446,277) | (597,030) |
| Net income | $ 710,036 | $ 830,656 | $ 2,276,244 | $ 2,398,919 |
| Basic earnings per share | $ 0.10 | $ 0.12 | $ 0.33 | $ 0.36 |
| Diluted earnings per share | $ 0.10 | $ 0.12 | $ 0.32 | $ 0.34 |
| Basic weighted average shares outstanding | 6,875,040 | 6,745,663 | 6,841,176 | 6,710,175 |
| Diluted weighted-average shares outstanding | 7,045,049 | 7,089,598 | 7,020,315 | 7,059,774 |
| Supplemental Information -- | |||||
| Reconciliation of Net Income to Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA): | |||||
| Three Months Ended | Nine Months Ended | ||||
| September 30, | September 30, | ||||
| 2010 | 2009 | 2010 | 2009 | ||
| Net income | $ 710,036 | $ 830,656 | $ 2,276,244 | $ 2,398,919 | |
| Depreciation and amortization | 593,796 | 568,549 | 1,773,679 | 1,620,057 | |
| Amortization - stock based compensation | 78,044 | 63,280 | 220,230 | 170,494 | |
| Interest expense, net | 64,410 | 85,692 | 210,496 | 261,681 | |
| Provision for income taxes | 472,755 | 553,000 | 1,550,044 | 1,604,634 | |
| Total | $ 1,919,041 | $ 2,101,177 | $ 6,030,693 | $ 6,055,785 | |