Diversicare Healthcare Services, Inc. (AVCA) swung to a net loss for the quarter ended Sep. 30, 2016. The company has made a net loss of $0.98 million, or $ 0.16 a share in the quarter, against a net profit of $0.43 million, or $0.11 a share in the last year period. On adjusted basis, net loss for the quarter stood at $0.67 million, or $0.11 a share compared with a net profit of $0.70 million, or $0.11 a share in the last year period.
Revenue during the quarter went down marginally by 0.81 percent to $97.31 million from $98.10 million in the previous year period. Gross margin for the quarter contracted 162 basis points over the previous year period to 18.37 percent. Operating margin for the quarter stood at negative 0.39 percent as compared to a positive 2.11 percent for the previous year period.
Operating loss for the quarter was $0.38 million, compared with an operating income of $2.07 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $2.18 million compared with $4.10 million in the prior year period. At the same time, adjusted EBITDA margin contracted 194 basis points in the quarter to 2.24 percent from 4.18 percent in the last year period.
Kelly Gill, Diversicare's chief executive officer, stated, "We are excited about our expanded presence in the state of Alabama which builds upon our entrance into the state of Mississippi last month. The combined addition of 22 centers now brings our total facility count to 76. In preparation for this sizable growth we made considerable strategic investments in our technology platform, which not only enables us to assimilate a portfolio of this scale, but also prepares us to continue our growth path in the years ahead. Since beginning our acquisition phase in the fall of 2013, we now have acquired 46 properties."
Working capital increases sharply
Diversicare Healthcare Services, Inc. has recorded an increase in the working capital over the last year. It stood at $9.34 million as at Sep. 30, 2016, up 155.81 percent or $5.69 million from $3.65 million on Sep. 30, 2015. Current ratio was at 1.20 as on Sep. 30, 2016, up from 1.06 on Sep. 30, 2015.
Days sales outstanding went down to 42 days for the quarter compared with 45 days for the same period last year.
At the same time, days payable outstanding was almost stable at 11 days for the quarter, when compared with the previous year period.
Debt moves up
Diversicare Healthcare Services, Inc. has witnessed an increase in total debt over the last one year. It stood at $68.70 million as on Sep. 30, 2016, up 22.24 percent or $12.50 million from $56.20 million on Sep. 30, 2015. Total debt was 48.97 percent of total assets as on Sep. 30, 2016, compared with 41.57 percent on Sep. 30, 2015. Debt to equity ratio was at 7.22 as on Sep. 30, 2016, up from 4.68 as on Sep. 30, 2015.
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