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WEST PALM BEACH, FL - (NewMediaWire) - May 31, 2024 - Ethema Health Corporation (OTCPINK: GRST) ("Ethema" "GRST" or the "Company"), filed its first quarter 10-Q today. The Company changed auditors in late 2023 and filing the 2023 10-K and 2024 first quarter were a challenge for the new auditors. Both of these filings were filed beyond their due dates resulting in a yield sign being placed on the Company's stock symbol. This symbol will be removed as the filings are now up to date. The Company does not anticipate any further late filings in future quarters.
Revenue from our core in-patient services increased by 7.4% from $1.2 million in Q1 2023 to $1.3 million in Q1 2024. The increase is in line with expectations, with a slight impact of current market conditions being felt by the business.
We disposed of our property-owning subsidiary in June 2023 which generated revenue of $0.1 million in Q1 2023.
Operating expenses increased by 24.2% from $1.2 million in Q1 2023 to $1.5 million in Q1 2024. The increase was primarily due to increases in (i) salary expenses as we increased head count to operate at maximum capacity; (ii) general and administrative expenses due to inflationary pressures and (iii) rental expense due to a property acquisition and sale transaction which was executed to inject cash flow into the business.
This resulted in an operating loss of $0.3 million for Q1 2024 compared to an operating income of $0.1 million for Q1 2023. We do not expect this trend to continue as we streamline our business and grow through our strategy of acquiring new patients, improving our revenue collection process and acquiring new facilities with minimal increase in operating costs.
Mr. Shawn Leon, Company CEO, reported, "We are disappointed with the late filing of both the 2023 10-K, and the 2024 first quarter 10-Q due to the change in auditors but that is behind us now and we do not expect any further late filings. The first quarter revenues are generally lower than the rest of the year and our first quarter results were impacted by increases in operating expenses. The operating expenses are up due to increase in rents as a result of our sale/leaseback transaction completed last summer and increased salaries with the addition of an executive director and a management team that are necessary to manage the expected growth in the periods ahead. We expect to show substantially better profitability in the remaining quarters of 2024."
About Ethema Health Corporation
Ethema Health Corporation (OTCPINK: GRST) operates in the behavioral healthcare space specifically in the treatment of substance use disorders. Ethema developed a unique style of treatment over the last decade and has had much success with in-patient treatment for adults. Ethema will continue to develop world class programs and techniques for North America. For more information you can visit our website at www.ethemahealth.com.