American Shared Hospital Services Reports Further Growth in Revenue and Earnings for the Second Quarter of 2006.SAN FRANCISCO -- Operating Income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. Increased 17% To Mark The 22nd Consecutive Year-Over-Year Gain; Net Income Increased 15% On 12% Increase in Revenue AMERICAN SHARED HOSPITAL SERVICES (AMEX AMEX See: American Stock Exchange :AMS AMS - Andrew Message System )(PCX (1) A bitmapped graphics file format that handles monochrome, 2-bit, 4-bit, 8-bit and 24-bit color and uses RLE to achieve compression ratios of approximately 1.1:1 to 1.5:1. Images with large blocks of solid colors compress best under the RLE method. See PC Paintbrush. :AMS), a leading provider of turnkey technology solutions for advanced radiosurgical and radiation therapy services, today announced improved financial results for the second quarter of 2006, highlighted by a 12% increase in revenue, a 17% increase in operating income (marking the 22nd consecutive quarter of year-over-year increases in this key measure of performance), and a 15% increase in net income compared to the second quarter of 2005. "This stellar operating performance validates our strategy to deliver sustained growth and build value for our shareholders," said Ernest A. Bates Bates , Katherine Lee 1859-1929. American educator and writer best known for her poem "America the Beautiful," written in 1893 and revised in 1904 and 1911. , M.D., Chairman and Chief Executive Officer. "Our portfolio of radiosurgical assets continues to perform well for the company, and gives us a solid base to extend our record of accomplishment into the future. We are particularly pleased that results at our newest Gamma Knife Gamma Knife A trademark for a radiologic nonsurgical device used in stereotactic radiosurgery. Gamma knife A surgical tool that focuses beams of radiation at the head, which converge in the brain to form a lesion. centers exceeded our expectations for the quarter. "We are working hard to develop additional contracts for our current-generation radiation therapy equipment offerings, as well as our proprietary Operating Room operating room n. Abbr. OR A room equipped for performing surgical operations. for the 21st Century(R) concept. We also have moved boldly to benefit from next-generation technology. Our recently announced equity investment in Still River Systems positions us to complement our traditional sources of growth with what we believe will be the next major advance in radiation oncology radiation oncology n. The branch of radiology that deals with the use of ionizing radiation to treat cancers. radiation oncology -- proton beam radiation therapy (PBRT). We also acquired an option to purchase two Clinatron-250(TM) PBRT systems from Still River Systems for anticipated delivery in 2008. "During the second quarter we raised our sights even further with our breakthrough agreement with Tufts-New England Medical Center Tufts-New England Medical Center (Tufts-NEMC) is a medical institution in Boston, Massachusetts. It is a center for research and is the principal teaching hospital for Tufts University School of Medicine where all full-time Tufts-NEMC physicians hold faculty appointments. to provide state-of-the-art equipment as part of a complete radiation therapy department upgrade. Taking advantage of AMS' creative financing solutions, we have dramatically expanded our growth opportunity by standing ready to provide treatment simulation and planning equipment and software as well as the latest technology solutions for radiation oncology delivery. We are excited by the opportunities we have created for AMS through our commitment to leadership in this exciting industry." Second Quarter Results For the three months ended June 30, 2006, revenue increased 12% to $5,309,000 from $4,730,000 for the same period a year earlier. Operating income increased 17% to $996,000 from $854,000 a year earlier, and pre-tax income increased 18% compared to the second quarter of 2005. Net income for second quarter of 2006 increased 15% to $448,000, or $0.09 per diluted share. This compares to net income for second quarter 2005 of $391,000, or $0.08 per diluted share. The effective income tax rate for this year's second quarter increased to 39% from 37% for the second quarter of 2005. At June 30, 2006, AMS reported working capital of $1,984,000, cash, cash equivalents and short-term securities of $7,318,000, and long-term securities of $2,962,000, which included its investment in Still River Systems. At December 31, 2005, working capital was $2,423,000, cash, cash equivalents and short-term securities were $5,835,000, and long-term securities were $2,797,000. Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. increased to $18,747,000 compared to $18,320,000 at December 31, 2005. Six Months Results For the six months ended June 30, 2006, revenue increased 13% to $10,354,000 from $9,179,000 for last year's first half. Operating income rose 15% to $1,942,000 compared to $1,690,000, and net income advanced 12% to $884,000, or $0.18 per diluted share, from $786,000, or $0.15 per diluted share, for the first six months of 2005. Earnings Conference Call American Shared has scheduled a conference call at 4:00 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT (1:00 p.m. PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT ) today. To participate in the live call, dial 800-471-6718 at least 5 minutes prior to the scheduled start time. A simultaneous WebCast of the call may be accessed through the Company's website, www.ashs.com, or through CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network , www.earnings.com. A replay will be available for 30 days at these same internet addresses, or by calling 888-843-8996, pass code 15269770. About AMS American Shared Hospital Services provides turnkey technology solutions for advanced radiosurgical and radiation therapy services. AMS is the world leader in providing Gamma Knife radiosurgery radiosurgery /ra·dio·sur·gery/ (-ser´jer-e) surgery in which tissue destruction is performed by means of ionizing radiation rather than by surgical incision. services, a non-invasive treatment for malignant and benign brain tumors, vascular malformations and trigeminal neuralgia Trigeminal Neuralgia Definition Trigeminal neuralgia is a disorder of the trigeminal nerve (the fifth cranial nerve) that causes episodes of sharp, stabbing pain in the cheek, lips, gums, or chin on one side of the face. (facial pain facial pain, n See pain, facial. ). The Company also offers the latest IGRT IGRT Image Guided Radiation Therapy and IMRT IMRT Intensity-modulated radiation therapy Radiation oncology A format for delivering high-dose RT to regions–eg, nasopharynx, that are surrounded by radiation-sensitive areas; in IMRT, a broad radiation field is divided into hundreds of small pencil beams, systems, as well as its proprietary Operating Room for the 21st Century concept. Through its equity investment in Still River Systems, AMS also plans to complement these services with the Clinatron-250(TM) proton beam radiation therapy (PBRT) system, which has not yet been approved by the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. . Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement This press release may be deemed to contain certain forward-looking statements with respect to the financial condition, results of operations and future plans of American Shared Hospital Services, which involve risks and uncertainties including, but not limited to, the risks of the Gamma Knife business, the risks of developing its IMRT and The Operating Room for the 21st Century(R) programs, and the risks of investing in a development-stage company, Still River Systems, Inc., without a proven product. Further information on potential factors that could affect the financial condition, results of operations and future plans of American Shared Hospital Services is included in the filings of the Company with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2005, the Form 10-Q for the three months ended March 31, 2006, and the definitive Proxy Statement for the Annual Meeting of Shareholders on June 28, 2006.
AMERICAN SHARED HOSPITAL SERVICES
Selected Financial Data
(unaudited)
Summary of Operations Data
Three months ended Six months ended
June 30, June 30,
2006 2005 2006 2005
------------ ------------ ------------ -----------
Revenue $5,309,000 $4,730,000 $10,354,000 $9,179,000
Costs of revenue 2,675,000 2,432,000 5,297,000 4,589,000
------------ ------------ ------------ -----------
Gross margin 2,634,000 2,298,000 5,057,000 4,590,000
Selling &
administrative
expense 1,078,000 933,000 1,992,000 1,854,000
Interest expense 560,000 511,000 1,123,000 1,046,000
------------ ------------ ------------ -----------
Operating income 996,000 854,000 1,942,000 1,690,000
Interest & other
income 87,000 57,000 177,000 100,000
Minority interest
expense (349,000) (287,000) (665,000) (561,000)
------------ ------------ ------------ -----------
Income before
income taxes 734,000 624,000 1,454,000 1,229,000
Income tax expense 286,000 233,000 570,000 443,000
------------ ------------ ------------ -----------
Net income $448,000 $391,000 $884,000 $786,000
============ ============ ============ ===========
Earnings per common
share:
Basic $0.09 $0.08 $0.18 $0.16
============ ============ ============ ===========
Assuming
dilution $0.09 $0.08 $0.18 $0.15
============ ============ ============ ===========
Balance Sheet Data
6/30/2006 6/30/2005
------------ ------------
Cash and cash
equivalents $2,143,000 $7,509,000
Securities-current
maturities $5,175,000 $1,258,000
Current assets $13,182,000 $12,579,000
Securities-long
term $2,962,000 $0
Total assets $51,281,000 $48,315,000
Current liabilities $11,198,000 $8,704,000
Shareholders'
equity $18,747,000 $18,016,000
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