Atlanta, Georgia (October 2, 2009) – SunLink Health Systems, Inc. (NYSE/Amex:SSY) today announced earnings from continuing operations for its fourth fiscal quarter ended June 30, 2009 of $850,000, or $0.11 per fully diluted share, compared to earnings from continuing operations of $579,000, or $0.07 per fully diluted share, for the quarter ended June 30, 2009. For the fiscal year ended June 30, 2009, SunLink reported earnings from continuing operations of $1,067,000, or $0.13 per fully diluted share, compared to earnings of $2,009,000, or $0.26 per fully diluted share, for the fiscal year ended June 30, 2008.

SunLink reported net earnings of $891,000, or $0.11 per fully diluted share, for the quarter ended June 30, 2009, compared to net earnings of $427,000, or $0.05 per fully diluted share, for the comparable quarter a year ago. For the fiscal year ended June 30, 2009, SunLink reported net earnings of $912,000, or $0.11 per fully diluted share compared to net earnings of $1,616,000, or $0.21 per share, for the fiscal year ended June 30, 2008.

Consolidated net revenues for the quarters ended June 30, 2009 and 2008 were $49,255,000 and $43,819,000, respectively, an increase of 12.4% for the fourth fiscal quarter. SunLink’s Specialty Pharmacy segment, which began business when it acquired Carmichael’s Cashway Pharmacy, Inc. on April 22, 2008, added $10,599,000 of net revenue for the quarter ended June 30, 2009 compared to $7,059,000 last year. The Healthcare Facilities segment net revenues for the quarter ended June 30, 2009 was $38,656,000 compared to $36,760,000 for the comparable quarter a year ago. The most recent fourth quarter’s results included an aggregate of $775,000 from state indigent care programs and positive prior year third-party payor settlements compared to $1,612,000 in the quarter ended June 30, 2008. Consolidated net revenues for the fiscal year ended June 30, 2009 increased by 25.8% to $199,254,000 compared to $158,431,000 in the comparable period a year ago. The Specialty Pharmacy segment had $47,329,000 of net revenue for the year ended June 30, 2009 compared to $7,059,000 for the prior fiscal year. The Healthcare Facilities segment net revenues for the fiscal year ended June 30, 2009 were $151,925,000 compared to $151,372,000 for the fiscal year ended June 30, 2008.

The company’s operating profit for the quarter ended June 30, 2009 was $2,354,000, or 4.8% of net revenues, compared to an operating profit for the quarter ended June 30, 2008 of $1,679,000, or 3.8% of net revenues. Operating profit as a percentage of net revenues increased in the fiscal year ended June 30, 2009 due to operating profit added by the Specialty Pharmacy segment. Operating profit for the fiscal year ended June 30, 2009 was $5,679,000, or 2.9% of net revenues, compared to $5,405,000, or 3.4% of net revenues, for the fiscal year ended June 30, 2008. Adjusted EBITDA (a non-GAAP measure of the liquidity of the company) at SunLink’s Healthcare Facilities segment for the fourth fiscal quarter increased to $4,005,000 from $3,867,000 in the comparable quarter a year ago. Adjusted EBITDA for SunLink’s Specialty Pharmacy segment was $1,205,000 in the fourth fiscal quarter compared to $821,000 in the comparable quarter a year ago which included Specialty Pharmacy results for 71 days.

SunLink Health Systems, Inc. currently operates seven community hospitals and related nursing home and home care businesses in the Southeast and Midwest and its specialty pharmacy business in Louisiana. Each SunLink hospital is the only hospital in its community. SunLink’s operating strategy is to link patients’ needs with dedicated physicians and health professionals to deliver quality, efficient medical care and healthcare products and services in each area it serves. For additional information on SunLink Health Systems, Inc., please visit the company’s website at www.sunlinkhealth.com.

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, without limitation, statements regarding the company's business strategy. These forward-looking statements are subject to certain risks, uncertainties and other factors, which could cause actual results, performance and achievements to differ materially from those anticipated. Certain of those risks, uncertainties and other factors are disclosed in more detail in the company's Annual Report on Form 10-K for the year ended June 30, 2009 and other filings with the Securities and Exchange Commission which can be located at www.sec.gov.

Earnings before income taxes, interest, depreciation and amortization (“EBITDA”) represent the sum of income before income taxes, interest, depreciation and amortization. We understand that certain industry analysts and investors generally consider EBITDA to be one measure of the liquidity of the company, and it is presented to assist analysts and investors in analyzing the ability of the company to generate cash, service debt and meet capital requirements. We believe increased EBITDA is an indicator of improved ability to service existing debt and to satisfy capital requirements. EBITDA, however, is not a measure of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income as a measure of operating performance or to cash liquidity. Because EBITDA is not a measure determined in accordance with accounting principles generally accepted in the United States of America and is thus susceptible to varying calculations, EBITDA, as presented, may not be comparable to other similarly titled measures of other corporations. Net cash provided by (used in) operations for the three months and fiscal year ended June 30, 2009 and 2008, respectively, is shown below. Healthcare Facilities Adjusted EBITDA and Specialty Pharmacy Adjusted EBITDA is the EBITDA for those facilities without any allocation of corporate overhead.

Go to Quarterly Results

Back to News Index