American Shared Hospital Services (AMS) Q3 2024 earnings summary

Executive summary

• Revenue grew 36.3% year-over-year to $6.99 million in Q3 2024, driven by the Rhode Island acquisition and new international operations in Puebla, Mexico.

• Retail segment revenue surged 273% to $3.69 million, offsetting a 16.1% decline in leasing revenue, with growth from Rhode Island and Puebla facilities.

• Net loss attributable to shareholders was $207,000 ($0.03/share) in Q3 2024, compared to net income of $118,000 in Q3 2023; nine-month net income was $3.51 million ($0.54/share), aided by a $3.94 million bargain purchase gain from the Rhode Island acquisition.

• Integrated three Rhode Island radiation therapy centers and began operations at a new facility in Puebla, Mexico.

• Gross margin declined to $1.37 million (19.6% of revenue) from $2.10 million (40.9%) year-over-year, impacted by higher costs and lower Gamma Knife volumes.

Financial highlights

• Q3 2024 revenue: $6.99 million (up from $5.13 million in Q3 2023); nine-month revenue: $19.27 million (up from $15.63 million in prior year).

• Q3 2024 net loss: $207,000; nine-month net income: $3.51 million, including a $3.94 million bargain purchase gain.

• Q3 2024 EPS: $(0.03); nine-month EPS: $0.54 (up from $0.03 in prior year period).

• Gross margin for Q3 2024: $1.37 million (19.6% of revenue), down from $2.10 million (40.9%) in Q3 2023.

• Cash and equivalents at September 30, 2024: $14.08 million.

Outlook and guidance

• Management expects continued growth in the retail segment from the Rhode Island acquisition and new Mexico facility, with margin and profitability improvements as operational efficiencies are realized.

• Anticipates reduced incremental costs from Rhode Island acquisition by over $300,000 in Q4.

• Ongoing investments in equipment upgrades and new site development, with several Gamma Knife and LINAC commitments scheduled for 2025 or later.

• Company believes cash on hand, operations, and credit line are sufficient for near-term obligations and expansion.

• Confident in long-term growth due to backlog and new business opportunities, including a potential proton therapy center in Rhode Island.