Cardiff Lexington Announces Third Quarter 2023 Financial Results
Revenue Growth and Significant Margin Improvement Drives Increase in Quarterly Net Income to $1.98 Million -
FT. LAUDERDALE, FL / ACCESSWIRE / November 15, 2023 / Cardiff Lexington Corporation (OTC PINK:CDIX) announced today financial results for its third quarter ended September 30, 2023.
Third Quarter Financial Highlights
9.8% growth in the Company's healthcare division drove 3.5% consolidated revenue growth to $3.4 million
83% gross profit margin in the Company's healthcare division up from 64.7% last year drove consolidated gross profit margin to 79.6% for the quarter
Operating income increased 52% to $2.3 million, or 67% of sales from $1.5 million, or 45% of sales in Q3 last year due to a deliberate focus on higher margin business and disciplined cost containment
Net income increased 415% to $1.98 million from a loss of $628,000 in Q3 last year
Nine Month Financial Highlights
16.2% growth in the Company's healthcare division drove 5.1% consolidated revenue growth to $9.8 million
72.7% gross profit margin in the Company's healthcare division up from 63.4% last year drove consolidated gross profit margin to 73% for the nine-month period
Operating income increased 41% to $4.7 million, or 47.9% of sales from $3.3 million, or 35.7% of sales in the nine-month period last year due to a deliberate focus on higher margin business and disciplined cost containment
Net income increased 247% to $2.8 million from a loss of $1.9 million in the comparable nine-month period last year
Balance Sheet Highlights at September 30, 2023
39% increase in total assets to $18.5 million compared to December 31, 2022
250% increase in stockholders' equity to $975,351 from a negative shareholders' equity of $1.47 million at December 31, 2022
Slightly positive working capital compared to a negative working capital at December 31, 2022
Alex Cunningham, Cardiff Lexington CEO, stated, "Results from our most recent third quarter reflect the culmination of efforts over the past several years to successfully position the Company within a growing healthcare sector, implement efficiencies, and streamline operations. We have taken the actions necessary to achieve and report sustainable, profitable results over consecutive quarters. Net income has reached $2.8 million thus far in 2023 which represents significant, quantifiable advancement for the Company. We expect this number to continue to grow moving forward as we begin to see the impact of the additional working capital being deployed from our new revolving financing.
Mr. Cunningham continued, "In conjunction with our significantly improving results from operations, we continue to prepare for a targeted early 2024 uplisting to a major exchange. To that end have filed with FINRA for the required share consolidation and also anticipate updating and amending our S1 registration filing to include 2023 Q3 results. In conjunction with this uplisting, it is also our intention to simplify our capital structure to best support our long term growth for shareholders."
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About Cardiff Lexington Corporation:
Cardiff Lexington Corporation is a holding company focused on locating, acquiring, and building middle market, niche companies, primarily in the healthcare industry. Fundamental to the Cardiff Lexington strategy is the service-based partnership culture which emphasizes core values, teamwork, accountability, and performance.
A substantial majority of the Company's revenue is derived from Nova Ortho and Spine, PLLC, or Nova, which the Company acquired in May of 2021 and operates a group of regional primary specialty and ancillary care facilities throughout Florida that provide traumatic injury victims with a full range of diagnostic and surgical services, primary care evaluations, interventional pain management, and specialty consultation services.
For more information on Cardiff Lexington Corporation, you may access the company's website at https://cardifflexington.com/
FORWARD LOOKING STATEMENT: This news release contains forward looking statements within the meaning of the Securities Litigation Reform Act. The statements reflect the Company's current views with respect to future events that involve risks and uncertainties. These risks include the failure to meet schedule or performance requirements of the Company's business, the Company's liquidity position, the Company's ability to obtain new business, the emergence of competitors with greater financial resources, and the impact of competitive pricing. In the light of these uncertainties the forward-looking events referred to in this release might not occur.
Cardiff Lexington Investor Relations
investorsrelations@cardifflexington.com
(800) 628-2100 ext. 705
or
IMS Investor Relations
cardifflexington@imsinvestorrelations.com
(203) 972-9200
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
(UNAUDITED)
THREE MONTHS | NINE MONTHS | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
REVENUE | ||||||||||||||||
Financial Services | $ | 32,264 | $ | 219,872 | $ | 304,967 | $ | 1,156,729 | ||||||||
Healthcare | 3,405,860 | 3,103,409 | 9,476,764 | 8,154,934 | ||||||||||||
Total revenue | 3,438,124 | 3,323,281 | 9,781,731 | 9,311,663 | ||||||||||||
COST OF SALES | ||||||||||||||||
Financial Services | 5,604 | 39,963 | 53,730 | 365,185 | ||||||||||||
Healthcare | 551,424 | 1,094,794 | 2,589,407 | 2,982,418 | ||||||||||||
Total cost of sales | 557,028 | 1,134,757 | 2,643,137 | 3,347,603 | ||||||||||||
GROSS PROFIT | 2,881,096 | 2,188,524 | 7,138,594 | 5,964,060 | ||||||||||||
OPERATING EXPENSES | ||||||||||||||||
Depreciation expense | 3,365 | 5,783 | 11,365 | 17,349 | ||||||||||||
Selling, general and administrative | 607,745 | 685,026 | 2,437,511 | 2,625,503 | ||||||||||||
Total operating expenses | 611,110 | 690,809 | 2,448,876 | 2,642,852 | ||||||||||||
INCOME FROM OPERATIONS | 2,269,986 | 1,497,715 | 4,689,718 | 3,321,208 | ||||||||||||
OTHER INCOME (EXPENSE) | ||||||||||||||||
Other income | - | (2 | ) | 205 | 6 | |||||||||||
Gain on forgiveness of debt | - | 1,397,271 | 390 | 1,397,271 | ||||||||||||
Interest expense and finance charge | (226,418 | ) | (3,430,785 | ) | (1,766,041 | ) | (6,686,772 | ) | ||||||||
Conversion cost | (1,000 | ) | - | (3,000 | ) | - | ||||||||||
Penalties and fees | (15,000 | ) | - | (45,000 | ) | - | ||||||||||
Amortization of debt discounts | (46,048 | ) | (92,868 | ) | (94,664 | ) | (249,120 | ) | ||||||||
Total other expenses, net | (288,466 | ) | (2,126,384 | ) | (1,908,110 | ) | (5,538,615 | ) | ||||||||
NET INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS | 1,981,520 | (628,669 | ) | 2,781,608 | (2,217,407 | ) | ||||||||||
GAIN FROM DISCONTINUED OPERATIONS | - | 363,895 | - | 328,353 | ||||||||||||
NET INCOME (LOSS) FOR THE PERIOD | $ | 1,981,520 | $ | (264,774 | ) | $ | 2,781,608 | $ | (1,889,054 | ) | ||||||
DEEMED DIVIDENDS ON PREFERRED STOCK | (142,829 | ) | - | (605,384 | ) | - | ||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 1,838,691 | $ | (264,774 | ) | $ | 2,176,224 | $ | (1,889,054 | ) | ||||||
CARDIFF LEXINGTON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2023 AND DECEMBER 31, 2022
(UNAUDITED)
September 30,2023 | December 31, 2022 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash | $ | 181,343 | $ | 226,802 | ||||
Accounts receivable-net | 11,844,738 | 6,604,780 | ||||||
Prepaid and other current assets | 5,000 | 5,000 | ||||||
Total current assets | 12,031,081 | 6,836,582 | ||||||
Property and equipment, net | 44,073 | 55,439 | ||||||
Land | 540,000 | 540,000 | ||||||
Goodwill | 5,666,608 | 5,666,608 | ||||||
Right of use - assets | 201,163 | 218,926 | ||||||
Due from related party | 4,979 | 4,979 | ||||||
Other assets | 30,823 | 30,823 | ||||||
Total assets | $ | 18,518,727 | $ | 13,353,357 | ||||
LIABILITIES, MEZZANINE EQUITY AND DEFICIENCY IN STOCKHOLDERS' EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued expense | $ | 2,515,682 | $ | 2,038,595 | ||||
Accrued expenses - related parties | 4,264,557 | 3,750,557 | ||||||
Accrued interest | 717,827 | 350,267 | ||||||
Right of use - liability | 135,776 | 142,307 | ||||||
Due to director & officer | 123,442 | 123,192 | ||||||
Notes payable | 24,600 | 15,809 | ||||||
Notes payable - related party | 159,662 | 37,024 | ||||||
Convertible notes payable, net of debt discounts of $66,674 and $46,798, respectively | 3,952,581 | 3,515,752 | ||||||
Total current liabilities | 11,894,127 | 9,973,503 | ||||||
Other liabilities | ||||||||
Notes payable | 144,668 | 139,789 | ||||||
Operating lease liability - long term | 64,147 | 84,871 | ||||||
Total liabilities | 12,102,942 | 10,198,163 | ||||||
Mezzanine equity | ||||||||
Redeemable Series N Senior Convertible Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value $4.00, 868,058 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 3,787,559 | 3,125,002 | ||||||
Redeemable Series X Senior Convertible Preferred Stock - 5,000,000 shares authorized, $0.001 par value, stated value $4.00, 375,000 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 1,652,875 | 1,500,000 | ||||||
Total Mezzanine Equity | 5,440,434 | 4,625,002 | ||||||
Stockholders' equity (deficit) | ||||||||
Series B Preferred Stock - 3,000,000 shares authorized, $0.001 par value, stated value $4.00, 2,134,478 and 2,131,328 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively | 8,537,912 | 8,525,313 | ||||||
Series C Preferred Stock - 500 shares authorized, $0.001 par value, stated value $4.00, 123 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 488 | 488 | ||||||
Series E Preferred Stock - 1,000,000 shares authorized, $0.001 par value, stated value $4.00, 155,750 and 150,750 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively | 623,000 | 603,000 | ||||||
Series F-1 Preferred Stock - 50,000 shares authorized, $0.001 par value, stated value $4.00, 35,752 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 143,008 | 143,008 | ||||||
Series I Preferred Stock - 15,000,000 shares authorized, $0.001 par value, 14,885,000 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 59,540,000 | 59,540,000 | ||||||
Series J Preferred Stock - 2,000,000 shares authorized, $0.001 par value, stated value $4.00, 1,713,584 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 6,854,336 | 6,854,336 | ||||||
Series L Preferred Stock - 400,000 shares authorized, $0.001 par value, stated value $4.00, 319,493 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 1,277,972 | 1,277,972 | ||||||
Series R Preferred Stock - 5,000 shares authorized, $0.001 par value, stated value of $1,200, 165 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 198,000 | 198,000 | ||||||
Common Stock - 7,500,000,000 shares authorized, $0.001 par value; 1,099,475,613 and 824,793,235 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively | 1,099,475 | 824,793 | ||||||
Additional paid-in capital | (8,619,611 | ) | (8,581,265 | ) | ||||
Accumulated deficit | (68,679,229 | ) | (70,855,453 | ) | ||||
Total stockholders' equity (deficit) | 975,351 | (1,469,808 | ) | |||||
Total liabilities, mezzanine equity and stockholders' equity | $ | 18,518,727 | $ | 13,353,357 | ||||
SOURCE: Cardiff Lexington Corporation
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