AdCare’s Revenue Triples in Q3 from Vigorous M&A Activity

AdCare, Inc., reported a net income of nearly $2.8 million, or $0.29 per diluted share, for the quarter ended Sept. 30, 2011, a substantial improvement over the previous year’s loss of $1.6 million, or $0.18 per share, thanks to multiple acquisitions in the quarter whose revenue boosted overall income.

Revenue in the quarter more than tripled from the same period in 2010, from $13.3 million to $40.9 million, primarily due to AdCare’s ongoing M&A activity. Expenses rose 179% to $39.2 million, and income from operations rose 133% to $1.7 million, compared to the previous year’s $0.76 million loss.

“Our ability to acquire and optimize nursing properties that have not traditionally concentrated on providing Medicare and post-acute services is beginning to be reflected in our core performance,” said Boyd Gentry, AdCare’s president and CEO. “In fact, our optimization strategy has increased Medicare Census 37.5% across facilities acquired in our M&A campaign.”


Since the beginning of the year, AdCare has put 29 facilities under contract, with a total of 51 from when the company’s M&A campaign began in 2009. AdCare’s chief acquisition officer stated the company’s intention to continue its acquisition program.

“Combining its current annualized run-rate with transactions currently in the process of closing, AdCare’s estimated annualized revenue run-rate is expected to exceed $300 million,” said the earnings report. “This would represent an increase of more than 460% over the company’s revenues in 2010, and an increase of more than 1,000% over revenues in 2009 when it initiated its M&A campaign.”

View the earnings report here.


Written by Alyssa Gerace