SunLink Health Systems, Inc. Announces Fiscal 2025 Second Quarter Results
SunLink Health Systems (NYSE American: SSY) reported its fiscal 2025 second quarter results, showing a loss from continuing operations of $1,070,000 ($0.15 per share) compared to $407,000 ($0.06 per share) in the same quarter last year. The company's consolidated net revenues decreased to $7,935,000 from $8,510,000, primarily due to lower pharmacy revenues.
The company announced a definitive merger agreement with Regional Health Properties on January 3, 2025, which will involve exchanging shares for 1,410,000 shares of Regional common stock and 1,410,000 shares of Series D 8% Cumulative Convertible Redeemable Preferred Stock. The merger requires shareholder and regulatory approvals.
SunLink continues to experience post-COVID-19 effects, including wage pressure, workforce shortages, supply chain disruption, and inflationary pressures. The company also recorded a $100,000 impairment loss related to its information technology business, which was sold in January 2025.
SunLink Health Systems (NYSE American: SSY) ha riportato i risultati del secondo trimestre fiscale 2025, mostrando una perdita dalle operazioni continuative di $1.070.000 ($0,15 per azione) rispetto a $407.000 ($0,06 per azione) nello stesso trimestre dell'anno scorso. I ricavi netti consolidati dell'azienda sono diminuiti a $7.935.000 da $8.510.000, principalmente a causa di minori ricavi dalla farmacia.
L'azienda ha annunciato un accordo di fusione definitivo con Regional Health Properties il 3 gennaio 2025, che comporterà lo scambio di azioni per 1.410.000 azioni ordinarie di Regional e 1.410.000 azioni di Serie D 8% Cumulative Convertible Redeemable Preferred Stock. La fusione richiede approvazioni da parte degli azionisti e delle autorità di regolamentazione.
SunLink continua a subire effetti post-COVID-19, tra cui pressioni salariali, carenze di personale, interruzioni della catena di approvvigionamento e pressioni inflazionistiche. L'azienda ha anche registrato una perdita per svalutazione di $100.000 relativa alla sua attività di tecnologia dell'informazione, venduta a gennaio 2025.
SunLink Health Systems (NYSE American: SSY) informó sobre los resultados del segundo trimestre fiscal 2025, mostrando una pérdida de operaciones continuas de $1,070,000 ($0.15 por acción) en comparación con $407,000 ($0.06 por acción) en el mismo trimestre del año pasado. Los ingresos netos consolidados de la compañía disminuyeron a $7,935,000 desde $8,510,000, principalmente debido a menores ingresos de farmacia.
La compañía anunció un acuerdo de fusión definitivo con Regional Health Properties el 3 de enero de 2025, que implicará el intercambio de acciones por 1,410,000 acciones ordinarias de Regional y 1,410,000 acciones de la Serie D 8% Cumulative Convertible Redeemable Preferred Stock. La fusión requiere aprobaciones de los accionistas y de las autoridades regulatorias.
SunLink continúa experimentando efectos post-COVID-19, incluyendo presiones salariales, escasez de mano de obra, interrupciones en la cadena de suministro y presiones inflacionarias. La compañía también registró una pérdida por deterioro de $100,000 relacionada con su negocio de tecnología de la información, que fue vendido en enero de 2025.
SunLink Health Systems (NYSE American: SSY)는 2025 회계연도 2분기 결과를 발표했으며, 계속 운영에서 $1,070,000 ($0.15 주당)의 손실을 보고했습니다. 이는 지난해 같은 분기의 $407,000 ($0.06 주당)와 비교됩니다. 회사의 연결 순수익은 $7,935,000에서 $8,510,000으로 감소했으며, 이는 주로 약국 수익 감소 때문입니다.
회사는 2025년 1월 3일 Regional Health Properties와의 최종 합병 계약을 발표했으며, 이는 1,410,000주 의 Regional 보통주 및 1,410,000주 의 시리즈 D 8% 누적 전환 가능 상환 우선주로 주식을 교환하는 것을 포함합니다. 이 합병은 주주 및 규제 기관의 승인이 필요합니다.
SunLink는 COVID-19 이후의 영향, 즉 임금 압박, 인력 부족, 공급망 중단 및 인플레이션 압박을 계속 경험하고 있습니다. 회사는 또한 2025년 1월에 판매된 정보 기술 사업과 관련하여 $100,000의 손상 손실을 기록했습니다.
SunLink Health Systems (NYSE American: SSY) a annoncé ses résultats pour le deuxième trimestre de l'exercice 2025, affichant une perte des opérations continuées de 1 070 000 $ (0,15 $ par action) par rapport à 407 000 $ (0,06 $ par action) au cours du même trimestre de l'année précédente. Les revenus nets consolidés de l'entreprise ont diminué à 7 935 000 $ contre 8 510 000 $, principalement en raison de revenus de pharmacie plus faibles.
L'entreprise a annoncé un accord de fusion définitif avec Regional Health Properties le 3 janvier 2025, qui impliquera l'échange d'actions pour 1 410 000 actions ordinaires de Regional et 1 410 000 actions de série D 8 % Cumulative Convertible Redeemable Preferred Stock. La fusion nécessite des approbations des actionnaires et des autorités réglementaires.
SunLink continue d'éprouver les effets post-COVID-19, notamment des pressions salariales, des pénuries de main-d'œuvre, des perturbations de la chaîne d'approvisionnement et des pressions inflationnistes. L'entreprise a également enregistré une perte de valeur de 100 000 $ liée à son activité de technologie de l'information, qui a été vendue en janvier 2025.
SunLink Health Systems (NYSE American: SSY) berichtete über die Ergebnisse des zweiten Quartals des Geschäftsjahres 2025 und wies einen Verlust aus fortgeführten Betrieben von 1.070.000 $ (0,15 $ pro Aktie) im Vergleich zu 407.000 $ (0,06 $ pro Aktie) im gleichen Quartal des Vorjahres aus. Die konsolidierten Nettoumsätze des Unternehmens sanken auf 7.935.000 $ von 8.510.000 $, hauptsächlich aufgrund geringerer Apothekeneinnahmen.
Das Unternehmen gab am 3. Januar 2025 eine verbindliche Fusionsvereinbarung mit Regional Health Properties bekannt, die den Austausch von Aktien für 1.410.000 Aktien des Regional-Stammkapitals und 1.410.000 Aktien der Serie D 8 % kumulativ wandelbaren Rückzahlbaren Vorzugsaktien umfassen wird. Die Fusion erfordert die Genehmigung der Aktionäre und der Aufsichtsbehörden.
SunLink erlebt weiterhin die Nachwirkungen von COVID-19, einschließlich Lohnpressuren, Arbeitskräftemangel, Störungen in der Lieferkette und inflationsbedingten Druck. Das Unternehmen hat auch einen Wertminderungsverlust von 100.000 $ im Zusammenhang mit seinem Geschäftsfeld Informationstechnologie verzeichnet, das im Januar 2025 verkauft wurde.
- Merger agreement with Regional Health Properties announced, potentially creating shareholder value
- Cash and cash equivalents increased to $8,020,000 from $7,170,000
- Loss from continuing operations increased 163% to $1,070,000 vs $407,000 year-over-year
- Consolidated net revenues declined 7% to $7,935,000 from $8,510,000
- Operating loss widened to $1,012,000 from $433,000 year-over-year
- Pharmacy revenues decreased due to lower retail pharmacy scripts and DME orders
- $100,000 impairment loss on IT business sale
Insights
The Q2 FY2025 results reveal a company in the midst of significant transformation, but with concerning operational metrics that warrant careful analysis. The operating loss has more than doubled year-over-year to
Core Business Challenges:
- Pharmacy operations, the primary revenue source, saw a
7% decline in revenue, indicating potential market share loss or structural issues in the retail pharmacy segment - Cost of goods sold increased as a percentage of revenue from
55.9% to58.2% , suggesting pricing pressures and inventory management challenges - Labor costs as a percentage of revenue jumped from
31.4% to34.2% , highlighting the impact of workforce shortages and wage inflation
Strategic Transformation:
- The merger with Regional Health Properties represents a strategic pivot, potentially providing scale benefits and operational synergies
- The deal structure, combining common and preferred shares with an
8% dividend yield, offers some downside protection for current shareholders - The divestment of the IT business and previous healthcare assets indicates a strategic streamlining of operations
The balance sheet remains relatively stable with
Net loss for the quarter ended December 31, 2024 was
Consolidated net revenues for the fiscal quarters ended December 31, 2024 and 2023 were
SunLink reported an operating loss for the quarter ended December 31, 2024 of
SunLink reported a loss from continuing operations of
SunLink reported an operating loss for the six months ended December 31, 2024 of
Merger
On January 6, 2025, the Company and Regional Health Properties, Inc. (“Regional”) jointly announced that they have entered into a definitive agreement and plan of merger (the “merger agreement”), dated January 3, 2025 pursuant to which the Company will merge with and into Regional (the “merger”) in exchange for the issuance of an aggregate of 1,410,000 shares of Regional common stock and 1,410,000 shares of Regional’s newly-authorized Series D
COVID-19 Pandemic
The Company continues to experience post-COVID-19 pandemic after-effects in its quarter and believes it will likely to continue experience these effects on its assets and operations in the foreseeable future particularly from salaries and wages pressure, workforce shortages, supply chain disruption and broad inflationary pressures. Our ability to make estimates of any such continuing effects on future revenues, expenses or changes in accounting judgments that have had or are reasonably likely to have a material effect on our financial statements is very limited, depending as they do on the severity and length thereof; as well as any further government actions and/or regulatory changes intended to address such effects.
SunLink Health Systems, Inc. is the parent company of subsidiaries that own and operate a pharmacy business and an information technology business in the Southeast (the latter of which sold on January 6, 2025). For additional information on SunLink Health Systems, Inc., please visit the Company’s website.
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, 2024 and other filings with the Securities and Exchange Commission which can be located at www.sec.gov.
| SUNLINK HEALTH SYSTEMS, INC. ANNOUNCES | |||||||||||||||||||||||||||||
| FISCAL 2025 SECOND QUARTER RESULTS | |||||||||||||||||||||||||||||
| Amounts in 000's, except per share | |||||||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) | |||||||||||||||||||||||||||||
| Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||||||||||||||
2024 |
2023 |
2024 |
2023 |
||||||||||||||||||||||||||
| % of Net | % of Net | % of Net | % of Net | ||||||||||||||||||||||||||
| Amount | Revenues | Amount | Revenues | Amount | Revenues | Amount | Revenues | ||||||||||||||||||||||
| Net revenues | $ |
7,935 |
|
|
100.0 |
% |
$ |
8,510 |
|
100.0 |
% |
$ |
15,858 |
|
100.0 |
% |
$ |
17,065 |
|
100.0 |
% |
||||||||
| Costs and Expenses: | |||||||||||||||||||||||||||||
| Cost of goods sold |
|
4,618 |
|
|
58.2 |
% |
|
4,761 |
|
55.9 |
% |
|
9,093 |
|
57.3 |
% |
|
9,532 |
|
55.9 |
% |
||||||||
| Salaries, wages and benefits |
|
2,713 |
|
|
34.2 |
% |
|
2,668 |
|
31.4 |
% |
|
5,791 |
|
36.5 |
% |
|
5,285 |
|
31.0 |
% |
||||||||
| Supplies |
|
40 |
|
|
0.5 |
% |
|
39 |
|
0.5 |
% |
|
74 |
|
0.5 |
% |
|
73 |
|
0.4 |
% |
||||||||
| Purchased services |
|
326 |
|
|
4.1 |
% |
|
281 |
|
3.3 |
% |
|
645 |
|
4.1 |
% |
|
567 |
|
3.3 |
% |
||||||||
| Other operating expenses |
|
833 |
|
|
10.5 |
% |
|
784 |
|
9.2 |
% |
|
1,637 |
|
10.3 |
% |
|
1,690 |
|
9.9 |
% |
||||||||
| Rent and leases |
|
93 |
|
|
1.2 |
% |
|
92 |
|
1.1 |
% |
|
187 |
|
1.2 |
% |
|
183 |
|
1.1 |
% |
||||||||
| Depreciation and amortization |
|
324 |
|
|
4.1 |
% |
|
318 |
|
3.7 |
% |
|
637 |
|
4.0 |
% |
|
618 |
|
3.6 |
% |
||||||||
| Operating loss |
|
(1,012 |
) |
|
-12.8 |
% |
|
(433 |
) |
-5.1 |
% |
|
(2,206 |
) |
-13.9 |
% |
|
(883 |
) |
-5.2 |
% |
||||||||
| Interest Income - net |
|
42 |
|
|
0.5 |
% |
|
29 |
|
0.3 |
% |
|
100 |
|
0.6 |
% |
|
51 |
|
0.3 |
% |
||||||||
| Impairment loss |
|
(100 |
) |
|
-1.3 |
% |
|
0 |
|
0.0 |
% |
|
(100 |
) |
-0.6 |
% |
|
0 |
|
0.0 |
% |
||||||||
| Gain on sale of assets |
|
0 |
|
|
0.0 |
% |
|
0 |
|
0.0 |
% |
|
694 |
|
4.4 |
% |
|
2 |
|
0.0 |
% |
||||||||
| Loss from Continuing Operations before | |||||||||||||||||||||||||||||
| Income Taxes |
|
(1,070 |
) |
|
-13.5 |
% |
|
(404 |
) |
-4.7 |
% |
|
(1,512 |
) |
-9.5 |
% |
|
(830 |
) |
-4.9 |
% |
||||||||
| Income Tax expense |
|
0 |
|
|
0.0 |
% |
|
3 |
|
0.0 |
% |
|
0 |
|
0.0 |
% |
|
5 |
|
0.0 |
% |
||||||||
| Loss from Continuing Operations |
|
(1,070 |
) |
|
-13.5 |
% |
|
(407 |
) |
-4.8 |
% |
|
(1,512 |
) |
-9.5 |
% |
|
(835 |
) |
-4.9 |
% |
||||||||
| Loss from Discontinued Operations, net of tax |
|
(273 |
) |
|
-3.4 |
% |
|
(2,668 |
) |
-31.4 |
% |
|
(380 |
) |
-2.4 |
% |
|
(3,584 |
) |
-21.0 |
% |
||||||||
| Net Loss | $ |
(1,343 |
) |
|
-16.9 |
% |
$ |
(3,075 |
) |
-36.1 |
% |
$ |
(1,892 |
) |
-11.9 |
% |
$ |
(4,419 |
) |
-25.9 |
% |
||||||||
| Loss Per Share from Continuing Operations: | |||||||||||||||||||||||||||||
| Basic | $ |
(0.15 |
) |
$ |
(0.06 |
) |
$ |
(0.21 |
) |
$ |
(0.12 |
) |
|||||||||||||||||
| Diluted | $ |
(0.15 |
) |
$ |
(0.06 |
) |
$ |
(0.21 |
) |
$ |
(0.12 |
) |
|||||||||||||||||
| Loss Per Share from Discontinued Operations: | |||||||||||||||||||||||||||||
| Basic | $ |
(0.04 |
) |
$ |
(0.38 |
) |
$ |
(0.05 |
) |
$ |
(0.51 |
) |
|||||||||||||||||
| Diluted | $ |
(0.04 |
) |
$ |
(0.38 |
) |
$ |
(0.05 |
) |
$ |
(0.51 |
) |
|||||||||||||||||
| Net Loss Per Share: | |||||||||||||||||||||||||||||
| Basic | $ |
(0.19 |
) |
$ |
(0.44 |
) |
$ |
(0.27 |
) |
$ |
(0.63 |
) |
|||||||||||||||||
| Diluted | $ |
(0.19 |
) |
$ |
(0.44 |
) |
$ |
(0.27 |
) |
$ |
(0.63 |
) |
|||||||||||||||||
| Weighted Average Common Shares Outstanding: | |||||||||||||||||||||||||||||
| Basic |
|
7,041 |
|
|
7,040 |
|
|
7,041 |
|
|
7,039 |
|
|||||||||||||||||
| Diluted |
|
7,041 |
|
|
7,040 |
|
|
7,041 |
|
|
7,039 |
|
|||||||||||||||||
| SUMMARY BALANCE SHEETS | December 31, | June 30, | |||||||||||||||||||||||||||
|
2024 |
|
|
2024 |
|
||||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||||
| Cash and Cash Equivalents | $ |
8,020 |
|
$ |
7,170 |
|
|||||||||||||||||||||||
| Receivable - net |
|
2,831 |
|
|
3,371 |
|
|||||||||||||||||||||||
| Current Assets Held for Sale |
|
256 |
|
|
1,959 |
|
|||||||||||||||||||||||
| Other Current Assets |
|
3,099 |
|
|
3,164 |
|
|||||||||||||||||||||||
| Property Plant and Equipment, net |
|
2,053 |
|
|
2,809 |
|
|||||||||||||||||||||||
| Long-term Assets |
|
1,613 |
|
|
2,139 |
|
|||||||||||||||||||||||
$ |
17,872 |
|
$ |
20,612 |
|
||||||||||||||||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||||||||||||||||||
| Current Liabilities | $ |
3,495 |
|
$ |
4,213 |
|
|||||||||||||||||||||||
| Noncurrent Liabilities |
|
296 |
|
|
426 |
|
|||||||||||||||||||||||
| Shareholders' Equity |
|
14,081 |
|
|
15,973 |
|
|||||||||||||||||||||||
$ |
17,872 |
|
$ |
20,612 |
|
||||||||||||||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20250212287098/en/
Robert M. Thornton, Jr.
Chief Executive Officer
(770) 933-7004
Source: SunLink Health Systems, Inc.
FAQ
What was SunLink Health Systems (SSY) Q2 2025 net loss per share?
What are the terms of SSY's merger with Regional Health Properties?
How much did SSY's pharmacy revenues decline in Q2 2025?
What was SSY's cash position as of December 31, 2024?
What operational challenges is SSY currently facing?
