MICROCAP LEADERSHIP SUMMIT

Transcription

1 MICROCAP LEADERSHIP SUMMIT WESTIN CHICAGO NORTHWEST HOTEL ITASCA, IL SEPTEMBER 23, 2016

2 SAFE HARBOR STATEMENT This presentation may be deemed to contain certain forward-looking statements with respect to the financial condition, results of operations and future plans of American Shared Hospital Services, which involve risks and uncertainties including, but not limited to, the risks of the Gamma Knife, radiation therapy and proton beam therapy businesses, the risks of the timing, financing, operations, and profitability of the Company s businesses and related market-based risks. Further information on potential factors that could affect the financial condition, results of operations and future plans of American Shared Hospital Services is included in the filings of the Company with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2015, Quarterly Report on Form 10-Q for the quarters ended on March 31, 2016 and June 30, 2016 and the definitive Proxy Statement for the Annual Meeting of Shareholders held on June 21, American Shared Hospital Services 2

3 BUSINESS OPERATIONS CURRENT OPERATIONS Radiosurgery Linear Accelerator Based Radiation Therapy Proton Beam Radiation Therapy 17 Centers 1 Center 1 Center American Shared Hospital Services 3

4 GAMMA KNIFE + Gold Standard for Cranial Radiosurgery + Typical Project Cost $3 - $4 million American Shared Hospital Services 4

5 PROTON THERAPY + Historically, centers were 3-5 treatment room centers costing $150 - $200 million or more + New single room systems by Mevion Medical Systems and others have reduced the average cost per treatment rooms to $25 - $35 million American Shared Hospital Services

6 ASHS - BUSINESS MODEL + Structured as a (alternative) leasing company + Innovative financing features not available from traditional finance companies American Shared Hospital Services 6

7 ASHS - BUSINESS MODEL + Long Term Agreements Typically 10 years + Revenue Sharing or Fee Per Use NO MINIMUM VOLUME GUARANTEES American Shared Hospital Services 7

8 ASHS - BUSINESS MODEL ASHS RESPONSIBILITIES + Acquire equipment + Equipment related operating expenses + Jointly fund marketing American Shared Hospital Services 8

9 ASHS - BUSINESS MODEL HOSPITAL S RESPONSIBILITIES + Site costs + Operating costs, excluding those covered by American Shared + Jointly fund marketing American Shared Hospital Services 9

10 GAMMA KNIFE TREATMENT INDICATIONS + Malignant Brain Tumors Metastatic Brain Tumors (180, ,000 Diagnosed Annually) + Benign Brain Tumors + Trigeminal Neuralgia (Facial Pain) + Vascular Malformations American Shared Hospital Services 10

11 ASTRO RECOMMENDATION Don t routinely add adjuvant whole brain radiation therapy to stereotactic radiosurgery for limited brain metastases 2014 Choosing Wisely List- American Society for Radiation Oncology (ASTRO). (n.d.). Retrieved from Choosing-Wisely-List/. American Shared Hospital Services 11

12 ASHS - GAMMA KNIFE PARTNERS 1. Methodist Healthcare System San Antonio, TX 2. Yale-New Haven Hospital New Haven, CT 3. Kettering Medical Center Kettering, OH 4. Tufts Medical Center Boston, MA 5. University of Arkansas for Medical Sciences Little Rock, AR American Shared Hospital Services 12

13 ASHS - GAMMA KNIFE PARTNERS 6. JFK Medical Center Edison, NJ 7. Sunrise Hospital and Medical Center Las Vegas, NV 8. Central Mississippi Medical Center Jackson, MS 9. OSF Healthcare Peoria, IL 10. Albuquerque Regional Medical Center Albuquerque, NM 11. Northern Westchester Hospital Mt. Kisco, NY American Shared Hospital Services 13

14 ASHS - GAMMA KNIFE PARTNERS 12. Mercy Health Center Oklahoma City, OK 13. USC University Hospital Los Angeles, CA 14. Fort Sanders Regional Medical Center Knoxville, TN 15. St. Vincent s Medical Center Jacksonville, FL 16. Sacred Heart Hospital Pensacola, FL 17. PeaceHealth Sacred Heart Medical Center at RiverBend Springfield, OR American Shared Hospital Services 14

15 ASHS RADIATION THERAPY PARTNER - LINAC 1. Tufts Medical Center Boston, MA American Shared Hospital Services

16 ASHS - FINANCIAL HIGHLIGHTS ($000 s) 6 Months Months Medical Services Revenue 8,756 8,511 16,548 EPS.03 (.34) (.28) Adjusted EPS Adjusted EBITDA 1 4, , ,656 3 Net Book Value 25,690 24,602 25,180 Common Shares Outstanding 5,368 5,364 5,364 (1) Non-GAAP. See slides elsewhere in this presentation for reconciliations of Adjusted EPS and Adjusted EBITDA to GAAP EPS and GAAP Net Income, respectively. (2) Excludes early exiting investment of debt (3) Excludes investment write-down American Shared Hospital Services 16

17 ASHS - RECONCILIATION OF NON-GAAP RESULTS OF OPERATIONS TO THE NEAREST COMPARABLE GAAP MEASURES ($000 s) 6 Months Months EPS.03 (.34) (.28) Per Share Adjustments: Early Extinguishment of Debt, Net of Estimated Tax Loss on Write Down Investment in Equity Securities Adjusted EPS American Shared Hospital Services 17

18 ASHS ADJUSTED EBITDA ($000 s) 6 Months Months Net Income (loss) 144 (1,842) (1,522) Plus: Income Tax Expense Interest Expense ,239 Depreciation and Amortization Expense 3,211 3,098 6,139 Share-Based Payment Loss on Write Down of Investment 0 2,114 2,140 Early Extinguishment of Debt Adjusted EBITDA 4,457 4,365 8,656 American Shared Hospital Services 18

19 ASHS - BALANCE SHEET ASSETS ($000 s) June 30, 2016 TOTAL CURRENT ASSETS $6,527 Property & Equipment, Net $51,800 Investment In Preferred Stock & Other Assets $974 Total Assets $59,301 LIABILITIES & SHAREHOLDERS' EQUITY CURRENT LIABILITIES Payables & Other Liabilities $1,854 Current Debt & Leases $7,723 TOTAL CURRENT LIABILITIES $9,577 Long-term Debt & Leases $19,791 Deferred Revenue $663 Deferred Income Taxes $3,580 Total Shareholders' Equity $25,690 Total Liabilities & Shareholders' Equity $59,301 American Shared Hospital Services 19

20 ASHS - PROTON BEAM RADIATION THERAPY + NOT A NEW technology + Clinically Advantageous American Shared Hospital Services 20

21 PROTON THERAPY INDICATIONS TREATED + Prostate + Breast + Head and Neck + Lymphomas + Lung + Central Nervous System + Liver + Pediatric + GI American Shared Hospital Services 21

22 ASHS - PROTON BEAM PARTNERS 1. The Marjorie and Leonard Williams Center for Proton Therapy at UF Health Cancer Center - Orlando Health

23 WHAT MAKES PROTON THERAPY SPECIAL + Protons deposit dose at tumor, versus x-rays passing through the tumor + Minimize damage to surrounding tissue American Shared Hospital Services 23

24 ASHS - BRAGG PEAK PHENOMENA 15 MV PHOTONS vs SOBP PROTONS American Shared Hospital Services 24

25 ASHS - PHOTON VS. PROTON PEDIATRIC MEDULLOBLASTOMA Photon Beam Delivery % Dose Recommended Proton Beam Delivery 10 American Shared Hospital Services 25

26 ASHS - UNITED STATES PBRT MARKET ANALYSIS PBRT CAPTURE RATE 15% 2 30% 3 Number of radiation therapy patients annually in the U.S , ,000 Percent of radiation therapy patients eligible for PBRT Number of potential PBRT patients in the U.S. 15% 30% 149, ,500 Potential PBRT room market* 597 1,194 *Assumed 250 patients treated annually per PBRT room (1) The American Cancer Society indicates that 1,658,370 people in the United States will be diagnosed with cancer in Approximately 60% of these people will receive radiation treatment. (2) Number of Patients Potentially Eligible for Proton Therapy, Acta Oncologica 2005; 44; ; Bengt Glimelius, Anders Ask, Et. Al. (3) Evaluation of Potential Proton Therapy Utilization in a Market Based Environment, Tomas Dvorak, M.D. and David E. Wazer, M.D. American Shared Hospital Services 26

27 ASHS - PBRT OPPORTUNITY + Currently only 24 PBRT centers in U.S PBRT centers under development in U.S. Particle Therapy Co-Operative Group. Retrieved from American Shared Hospital Services 27

28 ASHS - PROTON THERAPY STRATEGY + Develop single room proton beam radiation therapy centers with major hospitals American Shared Hospital Services 28

29 PROTON THERAPY MARKET ANALYSIS + Current Medicare Reimbursement: approximately $1,150 per fraction (daily session). A course of treatment runs fractions + Established centers typically treat patients per day, per treatment room American Shared Hospital Services 29

30 PROTON THERAPY MARKET ANALYSIS + Utilizes same business model as the Gamma Knife. Expect margins to be similar + For ASHS, each treatment room offers potential for substantial incremental revenue and EBITDA American Shared Hospital Services 30

31 ASHS - MANAGEMENT TEAM MANAGEMENT TEAM Ernest A. Bates, M.D. Chairman and CEO Craig K. Tagawa COO and CFO Ernest R. Bates V.P. of Sales and Business Development Years of Healthcare Experience American Shared Hospital Services 31

32 ASHS - SUMMATION + Supplier of Gamma Knife services since Long-standing alliances with premier cancer centers American Shared Hospital Services 32

33 ASHS - SUMMATION POSITIONED FOR GROWTH IN EMERGING PROTON THERAPY MARKET + Development and financing of Orlando project establishes ASHS proton bona fides + First proton therapy center now treating patients + Proton therapy provided modest revenue contribution in June quarter, more substantial in second half and beyond + Negotiating development of additional proton centers American Shared Hospital Services 33

34 2 Embarcadero Center, Suite 410 San Francisco, CA (415) NYSE MKT:AMS