Significantly enhanced balance sheet positions company for long-term growth
LEXINGTON, KY. / ACCESSWIRE / August 20, 2024 / Cardiff Lexington Corporation (OTC PINK:CDIX) announced today financial results for its second quarter and six months ended June 30, 2024.
Alex Cunningham, Chief Executive Officer of Cardiff Lexington, commented, "Our second quarter results were highlighted by a significantly improved balance sheet with shareholders' equity increasing to $5.8 million, 698% as compared to year end, as we strengthen our capital structure and position Cardiff Lexington for future growth.
"Among the many important initiatives underway, a major focus for our business is to continue expanding our network of healthcare locations throughout Florida and the broader southeast United States. To that end, we opened our 12th Nova Ortho and Spine location in Orlando, Florida subsequent to the close of the quarter. This location is performing well, and further enhances our visibility and patient access while providing us with a key presence in a larger metropolitan market.
"While our second quarter revenue was impacted by the timing of certain larger surgeries, we are on track to drive strengthened revenue and earnings performance in the back half of the year and into 2025 driven by an expanded network of healthcare locations and a strong reputation as a provider of high-quality medical care in a high-volume market."
Second Quarter 2024 Financial Highlights
Revenue of $2,330,964.
Gross profit margin of 66%.
Loss from continuing operations was $202,345. Included in SG&A expenses in 2Q 2024 were higher expenses associated with the anticipated growth of the business as well as charges for increased bad debt expense of $902,183 as a result of accepting lower patient claims settlement amounts due to efforts to accelerate cash collection.
Adjusted EBITDA was a loss of $118,428.
Six Months 2024 Financial Highlights
Revenue of $4,992,930.
Gross profit margin of 65%.
Income from continuing operations was $16,647. Included in operating expenses for the six months ended June 30, 2024 were increased expenses associated with the anticipated growth of the business, and increased bad debt expense of $1,242,017 as referenced above.
Adjusted EBITDA was $403,154.
Balance Sheet Highlights (June 30, 2024 compared to December 31, 2023)
269% increase in cash to $3,196,795.
19% increase in total assets to $24,659,020.
698% increase in shareholders' equity to $5,837,412.
Mr. Cunningham concluded, "As one of the fastest growing sectors in U.S. healthcare, it's becoming increasingly clear that orthopedic healthcare is a very attractive long-term growth market for us. Compared to other clinical specialties, orthopedics remains highly fragmented, and over the next decade, we believe that healthcare providers will continue to experience increasing demand primarily driven by an aging patient population and a rising number of car accidents nationwide. The trajectory of this market is encouraging, and we're optimistic about our growth prospects - both organic and through acquisition - that we believe will help us to drive enhanced value for shareholders."
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About Cardiff Lexington Corporation:
Cardiff Lexington Corporation is a holding company focused on locating, acquiring, and building middle market, niche companies, primarily in the healthcare industry. 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.
Cardiff Lexington Investor Relations
[email protected]
(800) 628-2100 ext. 705
or
IMS Investor Relations
[email protected]
(203) 972-9200
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2024 and 2023
(UNAUDITED)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2024 | 2023 (Restated) | 2024 | 2023 (Restated) | |||||||||||||
REVENUE | $ | 2,330,964 | $ | 3,364,506 | $ | 4,992,930 | $ | 6,070,905 | ||||||||
COST OF SALES | 793,010 | 1,081,689 | 1,741,164 | 2,037,984 | ||||||||||||
GROSS PROFIT | 1,537,954 | 2,282,817 | 3,251,766 | 4,032,921 | ||||||||||||
OPERATING EXPENSES | ||||||||||||||||
Depreciation expense | 3,366 | 3,365 | 6,731 | 8,000 | ||||||||||||
Share based compensation | - | - | 300,225 | - | ||||||||||||
Selling, general and administrative | 1,736,933 | 530,013 | 2,928,163 | 1,517,933 | ||||||||||||
Total operating expenses | 1,740,299 | 533,378 | 3,235,119 | 1,525,933 | ||||||||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS | (202,345 | ) | 1,749,439 | 16,647 | 2,506,988 | |||||||||||
OTHER INCOME (EXPENSE) | ||||||||||||||||
Other income | 2,047 | - | 2,047 | 204 | ||||||||||||
Gain on debt refinance and forgiveness | 78,834 | - | 78,834 | 390 | ||||||||||||
Penalties and fees | (330 | ) | (15,000 | ) | (1,330 | ) | (32,000 | ) | ||||||||
Interest expense | (41,347 | ) | (843,918 | ) | (417,616 | ) | (1,537,579 | ) | ||||||||
Amortization of debt discounts | (11,306 | ) | (30,633 | ) | (24,821 | ) | (48,616 | ) | ||||||||
Total other income (expense) | 27,898 | (889,551 | ) | (362,886 | ) | (1,617,601 | ) | |||||||||
NET (LOSS) INCOME BEFORE DISCONTINUED OPERATIONS | (174,447 | ) | 859,888 | (346,239 | ) | 889,387 | ||||||||||
LOSS FROM DISCONTINUED OPERATIONS | - | (43,810 | ) | (111,312 | ) | (89,300 | ) | |||||||||
NET (LOSS) INCOME FOR THE PERIOD | $ | (174,447 | ) | $ | 816,078 | $ | (457,551 | ) | $ | 800,087 | ||||||
PREFERRED STOCK DIVIDENDS | (326,174 | ) | $ | (125,744 | ) | $ | (477,808 | ) | (454,419 | ) | ||||||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ | (500,621 | ) | $ | 690,334 | $ | (935,359 | ) | $ | 345,668 | ||||||
BASIC (LOSS) INCOME PER SHARE | ||||||||||||||||
CONTINUING OPERATIONS | $ | (0.04 | ) | $ | 55.66 | $ | (0.11 | ) | $ | 28.75 | ||||||
DISCONTINUED OPERATIONS | $ | 0.00 | $ | (3.53 | ) | $ | (0.01 | ) | $ | (7.43 | ) | |||||
DILUTED (LOSS) INCOME PER SHARE | ||||||||||||||||
CONTINUING OPERATIONS | $ | (0.04 | ) | $ | 3.59 | $ | (0.11 | ) | $ | 1.45 | ||||||
DISCONTINUED OPERATIONS | $ | 0.00 | $ | (3.53 | ) | $ | (0.01 | ) | $ | (7.43 | ) | |||||
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC | 12,792,767 | 12,403 | 8,305,493 | 12,024 | ||||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED | 12,792,767 | 192,477 | 8,305,493 | 237,814 | ||||||||||||
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2024 AND DECEMBER 31, 2023
(UNAUDITED)
| December 31, 2023 | ||||||||
| June 30, 2024 | (Restated) | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash | $ | 3,196,795 | $ | 866,943 | ||||
Accounts receivable-net | 14,818,277 | 13,305,254 | ||||||
Prepaid and other current assets | 5,000 | 5,000 | ||||||
Total current assets | 18,020,072 | 14,177,197 | ||||||
Property and equipment, net | 27,929 | 34,661 | ||||||
Land | 540,000 | 540,000 | ||||||
Goodwill | 5,666,608 | 5,666,608 | ||||||
Right of use - assets | 348,702 | 289,062 | ||||||
Due from related party | 4,979 | 4,979 | ||||||
Other assets | 50,730 | 33,304 | ||||||
Total assets | $ | 24,659,020 | $ | 20,745,811 | ||||
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued expense | $ | 1,679,731 | $ | 2,047,131 | ||||
Accrued expenses - related parties | 4,353,056 | 4,733,057 | ||||||
Accrued interest | 103,345 | 620,963 | ||||||
Right of use - liabilities | 173,985 | 157,669 | ||||||
Due to director and officer | - | 120,997 | ||||||
Notes payable - current portion | 550,900 | 15,977 | ||||||
Line of credit | 6,675,746 | 2,120,100 | ||||||
Convertible notes payable, net of debt discounts of $0 and $24,820, respectively | 110,000 | 3,807,030 | ||||||
Net liabilities of discontinued operations | 237,643 | 237,643 | ||||||
Total current liabilities | 13,884,406 | 13,860,567 | ||||||
Notes payable | 142,391 | 144,666 | ||||||
Operating lease liability - long term | 169,811 | 119,056 | ||||||
Total liabilities | 14,196,608 | 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 June 30, 2024 and December 31, 2023 | 3,125,000 | 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 June 30, 2024 and December 31, 2023, respectively | - | 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 June 30, 2024 and December 31, 2023 | 1,500,000 | 1,690,685 | ||||||
Total Mezzanine Equity | 4,625,000 | 5,890,104 | ||||||
Stockholders' equity | ||||||||
Series B Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value of $4.00, 980,179 and 2,139,478 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 3,920,716 | 8,557,912 | ||||||
Series C Preferred Stock - 500 shares authorized, $0.001 par value, stated value of $4.00, 60 and 123 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 240 | 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 June 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, 25,750 and 35,752 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 103,000 | 143,008 | ||||||
Series I Preferred Stock - 15,000,000 shares authorized, $0.001 par value, stated value $4.00, 11,640,500 and 14,885,000 issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 46,562,000 | 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 June 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 June 30, 2024 and December 31, 2023 | 1,277,972 | 1,277,972 | ||||||
Series Y Senior Convertible Preferred Stock - 1,000,000 shares authorized, $0.001 par value, stated value of $4.00, 938,908 and 0 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 3,755,632 | - | ||||||
Common Stock; 300,000,000 shares authorized, $0.001 par value; 13,626,376 and 25,121 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 13,626 | 25 | ||||||
Additional paid-in capital | 19,522,200 | (7,581,212 | ) | |||||
Accumulated deficit | (69,619,474 | ) | (68,684,115 | ) | ||||
Total stockholders' equity | 5,837,412 | 731,418 | ||||||
Total liabilities, mezzanine equity and stockholders' equity | $ | 24,659,020 | $ | 20,745,811 | ||||
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2024 AND 2023
(UNAUDITED)
The following table reconciles Net income (loss) before discontinued operations (a GAAP measure) to EBITDA (a non-GAAP measure)
| Unaudited | Unaudited | |||||||||||||||
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2024 | 2023 (Restated) | 2024 | 2023 (Restated) | |||||||||||||
EBITDA (1) | ||||||||||||||||
Net income (loss) before discontinued operations | $ | (174,447 | ) | $ | 859,888 | $ | (346,239 | ) | $ | 889,387 | ||||||
Add: | ||||||||||||||||
Interest | 41,347 | 843,918 | 417,616 | 1,537,579 | ||||||||||||
Taxes | 0 | 0 | 0 | 0 | ||||||||||||
Depreciation | 3,366 | 3,365 | 6,731 | 8,000 | ||||||||||||
Amortization | 11,306 | 30,633 | 24,821 | 48,616 | ||||||||||||
EBITDA (1) | $ | (118,428 | ) | $ | 1,737,804 | $ | 102,929 | $ | 2,483,582 | |||||||
Adjusted EBITDA (2) | ||||||||||||||||
EBITDA | $ | (118,428 | ) | $ | 1,737,804 | $ | 102,929 | $ | 2,483,582 | |||||||
Add: | ||||||||||||||||
Stock compensation expense for shares issued | 0 | 0 | 300,225 | 0 | ||||||||||||
Adjusted EBITDA (2) | $ | (118,428 | ) | $ | 1,737,804 | $ | 403,154 | $ | 2,483,582 | |||||||
Contact Information
Walter Frank
Investor Relations
[email protected]
2039729200
SOURCE: Cardiff Lexington Corporation
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