REGIONAL HEALTH PROPERTIES, INC [RHE-PA] Filings

10-Q 1 rhe-20220930.htm 10-Q 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-33135

Regional Health Properties, Inc.

(Exact name of registrant as specified in its charter)

Georgia

81-5166048

(State or other jurisdiction
of incorporation)

(I.R.S. Employer
Identification Number)

454 Satellite Boulevard NW, Suite 100, Suwanee, GA 30024

(Address of principal executive offices)

(678) 869-5116

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	RHE	NYSE American
10.875% Series A Cumulative Redeemable Preferred Stock, no par value	RHE-PA	NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.:


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes ☐ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

As of November 11, 2022 the registrant had 1,768,720 shares of common stock, no par value, outstanding.

Regional Health Properties, Inc.

Form 10-Q

Table of Contents


		Page Number
Part I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)	3
	Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021	3
	Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021	4
	Consolidated Statements of Stockholders' Equity for the three and nine months ended September 30, 2022 and 2021	5
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021	7
	Notes to Consolidated Financial Statements	9
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37

Part II.	OTHER INFORMATION

Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3.	Defaults upon Senior Securities	39
Item 4.	Mine Safety Disclosures	39
Item 5.	Other Information	39
Item 6.	Exhibits	39

Signatures		44

Part I. Financial Information

Item 1. Financial Statements

REGIONAL HEALTH PROPERTIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in 000's)


	September 30, 2022			December 31, 2021
	(Unaudited)
ASSETS
Property and equipment, net	$	48,509		$	50,127
Cash		2,373			6,792
Restricted cash		3,024			3,056
Accounts receivable, net of allowances of $580 and $177		6,230			2,145
Prepaid expenses and other		1,251			460
Notes receivable		297			362
Intangible assets - bed licenses		2,471			2,471
Intangible assets - lease rights, net		116			134
Right-of-use operating lease assets		22,981			29,909
Goodwill		1,585			1,585
Lease deposits and other deposits		398			398
Straight-line rent receivable		6,190			8,257
Total assets	$	95,425		$	105,696
LIABILITIES AND EQUITY
Senior debt, net	$	44,887		$	46,043
Bonds, net		6,119			6,239
Other debt, net		1,562			594
Accounts payable		3,478			3,749
Accrued expenses		6,854			4,987
Operating lease obligation		25,258			32,059
Other liabilities		1,367			1,629
Total liabilities		89,525			95,300

Stockholders' equity:
Common stock and additional paid-in capital, no par value; 55,000 shares authorized; 1,769 and 1,775 shares issued and 1,760 and 1,775 shares outstanding at September 30, 2022 and December 31, 2021, respectively		62,642			62,515
Preferred stock, no par value; 5,000 shares authorized; 2,812 shares issued and outstanding, redemption amount $70,288 at September 30, 2022 and December 31, 2021		62,423			62,423
Accumulated deficit		(119,165	)		(114,542	)
Total stockholders' equity		5,900			10,396
Total liabilities and stockholders' equity	$	95,425		$	105,696

See accompanying notes to unaudited consolidated financial statements.

REGIONAL HEALTH PROPERTIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in 000's, except per share data)

(Unaudited)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Revenues:
Patient care revenues	$	7,769		$	2,309		$	14,650		$	7,444
Rental revenues		3,000			4,136			10,326			11,980
Management fees		255			248			774			743
Other revenues		6			9			20			84
Total revenues		11,030			6,702			25,770			20,251
Expenses:
Patient care expense		7,476			2,454			14,040			6,911
Facility rent expense		1,451			1,640			4,725			4,919
Cost of management fees		140			153			459			468
Depreciation and amortization		600			651			1,819			1,953
General and administrative expense		1,378			980			3,432			2,975
Doubtful accounts expense (recovery)		1,515			(1	)		3,742			76
Other operating expenses		441			219			1,409			755
Total expenses		13,001			6,096			29,626			18,057
(Loss) income from operations		(1,971	)		606			(3,856	)		2,194
Other (income) expense:
Interest expense, net		564			669			1,855			2,022
Gain on extinguishment of debt		—			(146	)		—			(146	)
Other (income) expense, net		(2,164	)		122			(1,088	)		839
Total other (income) expense, net		(1,600	)		645			767			2,715
Net loss	$	(371	)	$	(39	)	$	(4,623	)	$	(521	)
Preferred stock dividends - undeclared		(2,249	)		(2,250	)		(6,748	)		(6,748	)
Net Loss attributable to Regional Health Properties, Inc. common stockholders	$	(2,620	)	$	(2,289	)	$	(11,371	)	$	(7,269	)
Net loss per share of common stock attributable to Regional Health Properties, Inc.
Basic and diluted:	$	(1.48	)	$	(1.27	)	$	(6.40	)	$	(4.21	)
Weighted average shares of common stock outstanding:
Basic and diluted		1,769			1,775			1,778			1,728

See accompanying notes to unaudited consolidated financial statements.

REGIONAL HEALTH PROPERTIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Amounts in 000's)

(Unaudited)


	Shares of Common Stock				Shares of Preferred Stock			Shares of Treasury Stock			Common Stock and Additional Paid-in Capital			Preferred Stock		Accumulated Deficit			Total
Balances, December 31, 2021		1,775				2,812			(1	)	$	62,515		$	62,423	$	(114,542	)	$	10,396
Restricted stock issuance		24				—			—			—			—		—			—
Stock-based compensation		—				—			—			111			—		—			111
Exercise of restricted share awards net settlement option		—				—			(8	)		(46	)		—		—			(46	)
Net loss		—				—			—			—			—		(2,927	)		(2,927	)
Balances, March 31, 2022		1,799				2,812			(9	)	$	62,580		$	62,423	$	(117,469	)	$	7,534
Stock-based compensation		—				—			—			58			—		—			58
Forfeitures of stock based awards		(30	)			—			—			(54	)		—		—			(54	)
Net loss		—				—			-			-			—		(1,325	)		(1,325	)
Balances, June 30, 2022		1,769				2,812			(9	)	$	62,584		$	62,423	$	(118,794	)	$	6,213
Stock-based compensation		—				—			—			58			—		—			58
Net loss		—				—			—			—			—		(371	)		(371	)
Balances, September 30, 2022		1,769		-		2,812	-		(9	)	$	62,642		$	62,423	$	(119,165	)	$	5,900


	Shares of Common Stock			Shares of Preferred Stock		Shares of Treasury Stock		Common Stock and Additional Paid-in Capital			Preferred Stock		Accumulated Deficit			Total
Balances, December 31, 2020		1,688			2,812		—	$	62,041		$	62,423	$	(113,360	)	$	11,104
Net income		—			—		—		—			—		21			21
Balances, March 31, 2021		1,688			2,812		—	$	62,041		$	62,423	$	(113,339	)	$	11,125
Stock-based compensation		39			—		—		123			—		—			123
Exercise of restricted share awards net settlement option		(1	)		—		—		(7	)		—		—			(7	)
Treasury shares, no par value		1			—		—		—			—		—			—
Net loss		—			—		—		—			—		(503	)		(503	)
Balances, June 30, 2021		1,727			2,812		—	$	62,157		$	62,423	$	(113,842	)	$	10,738


Stock-based compensation	48	—	179	—	—		179
Net loss	—	—	—	—	(39	)	(39	)
Balances, September 30, 2021	1,775	2,812

REGIONAL HEALTH PROPERTIES, INC [RHE-PA] Filings
REGIONAL HEALTH PROPERTIES, INC [RHE] Filings
10-Q	[2022-11-22]
10-Q	[2022-08-23]
10-Q	[2022-05-31]
10-K	[2022-02-22]
10-Q	[2021-11-12]
10-Q	[2021-08-13]
10-Q	[2021-05-14]
10-K	[2021-03-29]
10-Q	[2020-11-13]
10-Q	[2020-08-11]
10-Q	[2020-06-11]
10-K	[2020-03-27]
10-Q	[2019-11-12]
10-Q	[2019-08-14]
10-Q	[2019-06-18]
10-K	[2019-05-17]
10-Q	[2018-11-14]
10-Q	[2018-08-14]
10-Q	[2018-05-21]
10-K	[2018-04-16]
10-Q	[2017-11-14]
10-Q	[2017-08-14]
10-Q	[2017-05-15]
10-K	[2017-04-17]
10-Q	[2016-11-14]
10-Q	[2016-08-15]
10-Q	[2016-05-16]
10-K	[2016-03-30]
10-Q	[2015-11-16]
10-Q	[2015-08-13]
10-Q	[2015-05-14]
10-K	[2015-03-31]
10-Q	[2014-11-13]
10-Q	[2014-08-11]
10-Q	[2014-05-08]
10-K	[2014-03-31]
S-1	[2013-12-31]
10-Q	[2013-11-14]
10-Q	[2013-08-14]
S-1	[2013-07-29]
10-Q	[2013-07-26]
10-K	[2013-07-08]
10-Q	[2012-11-13]
10-Q	[2012-08-07]
10-Q	[2012-05-10]
10-K	[2012-03-19]

REGIONAL HEALTH PROPERTIES, INC [RHE-PA] Filings

REGIONAL HEALTH PROPERTIES, INC [RHE] Filings