LEXINGTON, KY / ACCESSWIRE / November 21, 2024 / Cardiff Lexington Corporation (OTC PINK:CDIX) announced today financial results for its third quarter and nine months ended September 30, 2024.
Alex Cunningham, Chief Executive Officer of Cardiff Lexington, commented, "Operationally, our business performed well during the quarter. We opened our 12th Nova Ortho and Spine location in Orlando, Florida, establishing Nova Ortho and Spine in a major metropolitan area with greater population density and higher traffic, and saw an increase in booked procedures which generally bodes well for future revenues. That said, the severe weather across Florida during the quarter has delayed many procedures. Also, our GAAP revenue was negatively impacted in the quarter due to a change in estimate related to our claim settlement realization rate that better aligns third quarter revenue with 2024 annualized rates. Adjusted revenue for the quarter, excluding this one-time change in estimate, was $3.0 million. It is our expectation that revenue will return to more historical levels going forward and grow as we strengthen our working capital to support the long-term growth of our business."
"Demand is strong, and we continue to identify strategic locations to establish new Nova Ortho and Spine offices and expand our network of healthcare services. Our shareholders' equity has grown 410% since the beginning of the year, and with our visibility today, we believe that we are on track to deliver enhanced long-term performance supported by a robust network of locations and a strong reputation as a high-quality medical care provider," Mr. Cunningham concluded.
Third Quarter 2024 Financial Results
Total revenue was $1,355,641. Revenue in the third quarter included a one-time non-cash adjustment of $1,650,474 to better align third quarter revenue with 2024 annualized claim settlement realization rates. Non-GAAP adjusted revenue, excluding the one-time non-cash adjustment, was $3,006,115
Cost of sales in the quarter increased to $1,000,601 primarily related to laboratory fees
Selling, general, and administrative expenses of $936,835 primarily related to increased salaries and wages as the Company continues to invest in its growth
Loss from continuing operations was $585,160
Non-GAAP adjusted EBITDA was $1,061,912
Nine Months 2024 Financial Results
Total revenue was $5,149,416. Revenue for the nine months ended September 30, 2024, included a one-time non-cash adjustment of $1,650,474 to better align third quarter 2024 revenue with 2024 annualized claim settlement realization rates. Non-GAAP adjusted revenue, excluding this one-time non-cash adjustment, was $6,799,890
Cost of sales for the nine-month period was $2,741,765
Selling, general, and administrative expenses of $2,622,981 primarily related to increased salaries and wages as the Company continues to invest in its growth
Loss from continuing operations was $525,651. Included in operating expenses for the nine months ended September 30, 2024 were Non-GAAP increased expenses associated with the anticipated growth of the business of $596,225
Non-GAAP Adjusted EBITDA was $1,507,928
Balance Sheet Highlights (September 30, 2024, compared to December 31, 2023)
125% increase in cash to $1,949,600
13% increase in total assets to $23,514,762
410% increase in shareholders' equity to $3,729,120
-----
About Cardiff Lexington Corporation:
Cardiff Lexington Corporation is a unique targeted healthcare holding company focused on locating, acquiring, and building middle market, niche companies, primarily in Orthopedics, Spine Care, and Pain Management. Fundamental to the Cardiff Lexington strategy is the service-based partnership culture which emphasizes core values, teamwork, accountability, and performance.
A substantial majority of the Company's revenue is derived from Nova Ortho and Spine, LLC, which operates a group of regional primary specialty and ancillary care facilities throughout Florida that provide traumatic injury victims with a full range of diagnostic and surgical services, primary care evaluations, interventional pain management, and specialty consultation services.
For more information on Cardiff Lexington Corporation, you may access the company's website at https://cardifflexington.com/
FORWARD LOOKING STATEMENT: This news release contains forward looking statements within the meaning of the Securities Litigation Reform Act. The statements reflect the Company's current views with respect to future events that involve risks and uncertainties. These risks include the failure to meet schedule or performance requirements of the Company's business, the Company's liquidity position, the Company's ability to obtain new business, the emergence of competitors with greater financial resources, and the impact of competitive pricing. In the light of these uncertainties the forward-looking events referred to in this release might not occur.
Use of Non-GAAP Financial Measures
Cardiff Lexington Corporation prepares its consolidated financial statements in accordance with United States generally accepted accounting principles ("GAAP"). In addition to GAAP disclosures, this document contains financial information and measures considered to be "non-GAAP". These non-GAAP measures can be used in order to gain a more complete and accurate understanding of the Company's financial condition and results. Non-GAAP financial measures should be considered in conjunction with, and not as a substitute to GAAP financial measures.
Cardiff Lexington Investor Relations
[email protected]
(800) 628-2100 ext. 705
or
IMS Investor Relations
[email protected]
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(UNAUDITED)
|
| Unaudited |
|
| Unaudited |
| ||||||||||
|
| For the Three Months Ended |
|
| For the Nine Months Ended |
| ||||||||||
|
| September 30, |
|
| September 30, |
|
| September 30, |
|
| September 30, |
| ||||
| 2024 |
|
| 2023 (Restated) |
|
| 2024 |
|
| 2023 (Restated) |
| |||||
Total revenue |
| $ | 1,355,641 |
|
| $ | 3,405,859 |
|
| $ | 5,149,416 |
|
| $ | 9,476,764 |
|
Total cost of sales |
|
| 1,000,601 |
|
|
| 551,423 |
|
|
| 2,741,765 |
|
|
| 2,589,407 |
|
Gross profit |
|
| 355,040 |
|
|
| 2,854,436 |
|
|
| 2,407,651 |
|
|
| 6,887,357 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation expense |
|
| 3,365 |
|
|
| 3,365 |
|
|
| 10,096 |
|
|
| 11,365 |
|
Selling, general and administrative |
|
| 936,835 |
|
|
| 577,677 |
|
|
| 2,622,981 |
|
|
| 2,095,611 |
|
Stock compensation expense |
|
| 0 |
|
|
| 0 |
|
|
| 300,225 |
|
|
| 0 |
|
Total operating expenses |
|
| 940,200 |
|
|
| 581,042 |
|
|
| 2,933,302 |
|
|
| 2,106,976 |
|
(Loss) income from continuing operations |
|
| (585,160 | ) |
|
| 2,273,394 |
|
|
| (525,651 | ) |
|
| 4,780,381 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (expense) income |
|
| (6,767 | ) |
|
| (1 | ) |
|
| (4,720 | ) |
|
| 204 |
|
Gain on debt refinance, forgiveness and settlement |
|
| 0 |
|
|
| 0 |
|
|
| 78,834 |
|
|
| 390 |
|
Penalties and fees |
|
| 0 |
|
|
| (16,000 | ) |
|
| (1,330 | ) |
|
| (48,000 | ) |
Interest expense |
|
| (1,386,041 | ) |
|
| (226,119 | ) |
|
| (1,803,657 | ) |
|
| (1,763,698 | ) |
Amortization of debt discounts |
|
| 0 |
|
|
| (46,048 | ) |
|
| (24,821 | ) |
|
| (94,664 | ) |
Total other (expense) income |
|
| (1,392,808 | ) |
|
| (288,168 | ) |
|
| (1,755,694 | ) |
|
| (1,905,768 | ) |
Net (loss) income before discontinued operations |
|
| (1,977,968 | ) |
|
| 1,985,226 |
|
|
| (2,281,345 | ) |
|
| 2,874,613 |
|
Loss from discontinued operations |
|
| 0 |
|
|
| (3,705 | ) |
|
| (111,312 | ) |
|
| (93,005 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
| $ | (1,977,968 | ) |
| $ | 1,981,521 |
|
| $ | (2,392,657 | ) |
| $ | 2,781,608 |
|
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2024 AND DECEMBER 31, 2023
(UNAUDITED)
|
| September 30, |
|
| December 31, |
| ||
|
| 2024 |
|
| 2023 (Restated) |
| ||
ASSETS |
|
|
|
|
|
| ||
Current assets |
|
|
|
|
|
| ||
Cash |
| $ | 1,949,600 |
|
| $ | 866,943 |
|
Accounts receivable-net |
|
| 14,798,220 |
|
|
| 13,305,254 |
|
Prepaid and other current assets |
|
| 5,000 |
|
|
| 5,000 |
|
Total current assets |
|
| 16,752,820 |
|
|
| 14,177,197 |
|
|
|
|
|
|
|
|
| |
Property and equipment, net |
|
| 24,563 |
|
|
| 34,661 |
|
Land |
|
| 540,000 |
|
|
| 540,000 |
|
Goodwill |
|
| 5,666,608 |
|
|
| 5,666,608 |
|
Right of use - assets, net |
|
| 465,389 |
|
|
| 289,062 |
|
Due from related party |
|
| 4,979 |
|
|
| 4,979 |
|
Other assets |
|
| 60,403 |
|
|
| 33,304 |
|
Total assets |
| $ | 23,514,762 |
|
| $ | 20,745,811 |
|
|
|
|
|
|
|
|
| |
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable and accrued expense |
| $ | 1,386,412 |
|
| $ | 2,047,131 |
|
Accrued expenses - related parties |
|
| 4,353,056 |
|
|
| 4,733,057 |
|
Accrued interest |
|
| 361,172 |
|
|
| 620,963 |
|
Right of use - lease liabilities |
|
| 227,606 |
|
|
| 157,669 |
|
Due to director and officer |
|
| 0 |
|
|
| 120,997 |
|
Notes payable - current portion |
|
| 500,826 |
|
|
| 15,977 |
|
Line of credit |
|
| 7,468,971 |
|
|
| 2,120,100 |
|
Convertible notes payable, net of debt discounts of $0 and $24,820, respectively |
|
| 105,000 |
|
|
| 3,807,030 |
|
Net liabilities of discontinued operations |
|
| 237,643 |
|
|
| 237,643 |
|
Total current liabilities |
|
| 14,640,686 |
|
|
| 13,860,567 |
|
|
|
|
|
|
|
|
| |
Other liabilities |
|
|
|
|
|
|
|
|
Notes payable |
|
| 140,272 |
|
|
| 144,666 |
|
Operating lease liability - long term |
|
| 236,853 |
|
|
| 119,056 |
|
Total liabilities |
|
| 15,017,811 |
|
|
| 14,124,289 |
|
|
|
|
|
|
|
|
| |
Mezzanine equity |
|
|
|
|
|
|
|
|
Redeemable Series N Senior Convertible Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value $4.00, 868,056 shares issued and outstanding at September 30, 2024 and December 31, 2023 |
|
| 3,230,023 |
|
|
| 3,891,439 |
|
Redeemable Series R Senior Convertible Preferred Stock - 5,000 shares authorized, $0.001 par value, stated value of $1,200, 0 and 165 shares issued and outstanding at September 30, 2024 and December 31, 2023 |
|
| 0 |
|
|
| 307,980 |
|
Redeemable Series X Senior Convertible Preferred Stock - 5,000,000 shares authorized, $0.001 par value, stated value of $4.00 par value; 375,000 shares issued and outstanding at September 30, 2024 and December 31, 2023 |
|
| 1,537,808 |
|
|
| 1,690,685 |
|
Total Mezzanine Equity |
|
| 4,767,831 |
|
|
| 5,890,104 |
|
|
|
|
|
|
|
|
| |
Stockholders' equity |
|
|
|
|
|
|
|
|
Series B Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value of $4.00, 753,929 and 2,139,478 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| 3,015,716 |
|
|
| 8,557,912 |
|
Series C Preferred Stock - 500 shares authorized, $0.001 par value, stated value of $4.00, 43 and 123 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| 172 |
|
|
| 492 |
|
Series E Preferred Stock - 1,000,000 shares authorized, $0.001 par value, stated value $4.00, 75,375 and 155,750 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| 301,500 |
|
|
| 623,000 |
|
Series F-1 Preferred Stock - 50,000 shares authorized, $0.001 par value, stated value $4.00, 9,500 and 35,752 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| 38,000 |
|
|
| 143,008 |
|
Series I Preferred Stock - 15,000,000 shares authorized, $0.001 par value, stated value $4.00, 11,540,500 and 14,885,000 issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| 46,162,200 |
|
|
| 59,540,000 |
|
Series J Preferred Stock - 2,000,000 shares authorized, $0.001 par value, stated value $4.00, 0 and 1,713,584 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| - |
|
|
| 6,854,336 |
|
Series L Preferred Stock - 400,000 shares authorized, $0.001 par value, stated value $4.00, 319,493 shares issued and outstanding at September 30, 2024 and December 31, 2023 |
|
| 1,277,972 |
|
|
| 1,277,972 |
|
Series Y Senior Preferred Stock - 1,000,000 shares authorized, $0.001 par value, stated value of $4.00, 955,114 and 0 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
| 3,820,456 |
|
|
| - |
|
Common Stock - 300,000,000 shares authorized, $0.001 par value; 14,555,601 and 25,121 shares issued and outstanding at September 30, 2024 and December 31, 2023 |
|
| 14,556 |
|
|
| 25 |
|
Additional paid-in capital |
|
| 20,891,337 |
|
|
| (7,581,212 | ) |
Accumulated deficit |
|
| (71,792,589 | ) |
|
| (68,684,115 | ) |
Total stockholders' equity |
|
| 3,729,120 |
|
|
| 731,418 |
|
Total liabilities, mezzanine equity and stockholders' equity |
| $ | 23,514,762 |
|
| $ | 20,745,811 |
|
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(UNAUDITED)
The following table reconciles Net (loss) income before discontinued operations (a GAAP measure) to EBITDA (a non-GAAP measure)
| Unaudited |
|
| Unaudited |
| |||||||||||
| For the Three Months Ended |
|
| For the Nine Months Ended |
| |||||||||||
| September 30, |
|
| September 30, |
| |||||||||||
| 2024 |
|
| 2023 (Restated) |
|
| 2024 |
|
| 2023 (Restated) |
| |||||
EBITDA (1) |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Net (loss) income before discontinued operations |
| $ | (1,977,968 | ) |
| $ | 1,985,226 |
|
| $ | (2,281,345 | ) |
| $ | 2,874,613 |
|
Add: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest |
|
| 1,386,041 |
|
|
| 226,119 |
|
|
| 1,803,657 |
|
|
| 1,763,698 |
|
Taxes |
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
Depreciation |
|
| 3,365 |
|
|
| 3,365 |
|
|
| 10,096 |
|
|
| 11,365 |
|
Amortization |
|
| 0 |
|
|
| 46,048 |
|
|
| 24,821 |
|
|
| 94,664 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
EBITDA (1) |
| $ | (588,562 | ) |
| $ | 2,260,758 |
|
| $ | (442,771 | ) |
| $ | 4,744,340 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Adjusted EBITDA (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA |
| $ | (588,562 | ) |
| $ | 2,260,758 |
|
| $ | (442,771 | ) |
| $ | 4,744,340 |
|
Add: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in estimate for settlement realization rate |
|
| 1,650,474 |
|
|
| 0 |
|
|
| 1,650,474 |
|
|
| 0 |
|
Stock compensation expense for shares issued |
|
| 0 |
|
|
| 0 |
|
|
| 300,225 |
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (2) |
| $ | 1,061,912 |
|
| $ | 2,260,758 |
|
| $ | 1,507,928 |
|
| $ | 4,744,340 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(1) EBITDA is a non-GAAP financial measure defined as Earnings Before Interest, Income Tax, Depreciation and Amortization. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(2) Adjusted EBITDA is a non-GAAP financial measure that is the sum of EBITDA plus non-recurring and non-cash charges. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF REVENUE FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024
(UNAUDITED)
|
| Unaudited |
|
| Unaudited |
| ||
|
| For the Three Months Ended |
|
| For the Nine Months Ended |
| ||
|
| September 30, 2024 |
|
| September 30, 2024 |
| ||
|
|
|
|
|
|
| ||
GAAP Revenue |
| $ | 1,355,641 |
|
| $ | 5,149,416 |
|
Adjustment to Claim Settlement Realization Rate |
|
| 1,650,474 |
|
|
| 1,650,474 |
|
Non-GAAP Adjusted Revenue |
|
| 3,006,115 |
|
|
| 6,799,890 |
|
Contact Information
Walter Frank
Investor Relations
[email protected]
2039729200
SOURCE: Cardiff Lexington Corporation