American Shared Hospital Services

Good day, and welcome to the American Shared Hospital Services third quarter 2023 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Stephanie Prince of PCG Advisory. Please go ahead.

Thank you, Jason, and thank you to everyone joining us today. AMS's third quarter 2023 earnings press release was issued this afternoon at 4.01 p.m. Eastern Time. If you need a copy, it can be accessed on the company's website at ashs.com at press releases under the Investors tab. Before turning the call over to management, I would like to make the following remarks concerning forward-looking statements. Please note that various remarks that may be made on this conference call about future expectations, plans and prospects for the company constitute forward-looking statements for the purposes of safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may vary materially from those indicated by these forward-looking statements as a result of various important factors including those discussed in the company's filings at the SEC. This includes the company's quarterly report on Form 10-Q for the three-month periods ended March 31st and June 30th, 2023, the annual report on Form 10-K for the year ended December 31, 2022, and the definitive proxy statement for the annual meeting of shareholders that was held on June 20th, 2023. The company assumes no obligation to update the information contained in this conference call. Before I turn the call over to Ray, I'd like to announce that we're instituting a new Q&A policy with this quarter's call. We're going to ask everybody to limit their questions to one question and one follow-up. As always, we'll be happy to take additional questions offline at any time. With that, I'd now like to turn the call over to Ray Stachowiak, Executive Chairman Ray?

Thank you, Stephanie, and good afternoon, everyone. Thank you for joining us today for our third quarter 2023 earnings conference call. I'll begin with some opening remarks and then turn the call over to Peter Gaccione, American Chair's Chief Executive Officer. Bob Hyatt, our CFO, will then give a financial review of the third quarter results. Following the prepared remarks, we'll open the call for your questions. American Shared had another solid quarter with year-over-year revenue increasing by 6.3% to $5.1 million for the third quarter. We continue to maintain a tight rein on direct costs and the gross margin grew 7.4% to $2.1 million. During the third quarter, we continue to invest heavily business activities and reported net income of $118,000 or two cents per diluted share. This included net interest expense of $128,000 down significantly from last year and increasingly offset by interest income on our growing cash balances. We've also engaged the services of a compensation consulting firm to review our compensation practices. At quarter end, our cash balances totaled $14.7 million, or approximately $2.29 per share. AMS consistently generates positive cash flow even throughout the pandemic. During the quarter, our sales and marketing team continued to generate and work on many new business opportunities. We're especially excited by three unique opportunities which we first mentioned on our last call. In the third quarter, we invested approximately $320,000 advancing these unique opportunities. Without these expenses, net income would have been approximately $240,000 higher. In addition, in the second quarter, we invested roughly $250,000 on these projects. Together, this totals $570,000 that we've invested so far this year. We look forward to announcing more details about these unique projects that will expand our domestic footprint at the appropriate time. Internationally, the installation of new equipment with expanded treatment offerings at two of our locations has progressed well. At our newest cancer center joint venture in Puebla, Mexico, installation of the digital linear accelerator with VMAT, IGRT, and radial surgery ability, or LINAC, is well underway. This will be a new revenue stream for us when patient treatments start up in early 2024, and it will be the most advanced radiation therapy treatment system within our catchment area. At our center in Ecuador, installation of the upgraded gamma knife icon is complete and patient treatments are expected to restart this month. This will be the only gamma knife in Ecuador for non-invasive radiosurgery. I'm proud to say that AMS will have the most advanced radiation cancer treatment system in their region when the installations are complete. Cancer patients in those areas are in need of these advanced treatments and we look forward to serving them. In closing, I hope I've conveyed some of the excitement that we all feel here at AMS. I wish I could share more details so it'll be clearer to you what we're working on. I can tell you this, we expect a unique return from the $570,000 that we've invested. The management team and the board all take our fiduciary responsibility to deliver the highest returns very seriously. And we're constantly weighing the expected returns of investment opportunities against other uses of our cash. That's our job. I'm very comfortable with the decisions we've made and the potential of the opportunities we're working on. With that, I'll turn the call over to Peter. Peter?