[10-Q] AMERICAN SHARED HOSPITAL SERVICES Quarterly Earnings Report
American Shared Hospital Services (AMS) reported Q3 2025 results showing modest top-line growth and a near breakeven bottom line. Revenue reached $7,171,000, up from $6,999,000 a year ago. Gross margin was $1,586,000. The company posted an operating loss of $344,000 and a net loss attributable to AMS of $17,000. Segment mix remained balanced, with leasing revenue of $3,137,000 and direct patient services of $4,034,000.
Year-to-date, operating cash flow improved to $3,802,000, while capital spending drove investing cash outflows of $9,618,000. Cash and restricted cash were $5,345,000 at September 30, 2025, and long‑term debt was $18,184,000. AMS had $2,000,000 outstanding on its $7,000,000 revolver at quarter‑end, which was repaid in October 2025. The company received a limited waiver under its credit agreement related to the funded debt to EBITDA covenant for June 30, 2025 and was in compliance as of September 30, 2025. Equipment and service commitments totaled $7,884,000 and $6,870,000, respectively. Shares outstanding were 6,543,000 as of November 11, 2025.
- None.
- None.
Insights
Liquidity steady; covenant waiver obtained; capex remains elevated.
AMS ended the quarter with cash and restricted cash of
The company received a limited waiver on the maximum funded debt to EBITDA covenant for the
Watch leverage metrics under the Fifth Third Credit Agreement and the DFC facility, plus revolver availability, as AMS executes on equipment installations and service contracts totaling
Balanced revenue mix; near breakeven quarter; RI clinics embedded.
Quarterly revenue was
Nine‑month results show direct patient services growth after integrating the Rhode Island centers, while leasing revenues moderated. Depreciation of
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
| 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
American Shared Hospital Services
(Exact name of registrant as specified in its charter)
| | |
| (State or other jurisdiction of | (IRS Employer |
| | Suite 850 | | | |
| (Address of principal executive offices) | (Zip code) | |||
(
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| | | 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 Securities 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.
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).
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 the definitions 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 ☐ | 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. ☐
Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of November 11, 2025, there were outstanding
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
AMERICAN SHARED HOSPITAL SERVICES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| ASSETS | September 30, 2025 | December 31, 2024 | ||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Accounts receivable, net of allowance for credit losses of $380,000 and $265,000 at September 30, 2025 and at December 31, 2024 | ||||||||
| Tax receivables | ||||||||
| Other receivables | ||||||||
| VAT receivable | ||||||||
| Prepaid maintenance | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Land | ||||||||
| Goodwill | ||||||||
| Intangible asset | ||||||||
| Right of use assets, net | ||||||||
| Other assets | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Employee compensation and benefits | ||||||||
| Other accrued liabilities | ||||||||
| Related party liabilities | ||||||||
| Asset retirement obligations, related party (includes $250,000 and $250,000 non-related party at September 30, 2025 and December 31, 2024) | ||||||||
| Current portion of lease liabilities | ||||||||
| Line of credit | ||||||||
| Current portion of long-term debt, net | ||||||||
| Total current liabilities | ||||||||
| Long-term lease liabilities, less current portion | ||||||||
| Long-term debt, net, less current portion | ||||||||
| Deferred income taxes | ||||||||
| Total liabilities | ||||||||
| Commitments (see Note 8) | ||||||||
| Shareholders' equity: | ||||||||
| Common stock, no par value (10,000,000 authorized shares; Issued and outstanding shares - 6,510,000 at September 30, 2025 and 6,420,000 at December 31, 2024) | ||||||||
| Additional paid-in capital | ||||||||
| Retained earnings | ||||||||
| Total equity-American Shared Hospital Services | ||||||||
| Non-controlling interests in subsidiaries | ||||||||
| Total shareholders' equity | ||||||||
| Total liabilities and shareholders' equity | $ | $ | ||||||
See accompanying notes
AMERICAN SHARED HOSPITAL SERVICES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Revenues: | ||||||||||||||||
| Rental revenue from medical equipment leasing | $ | $ | $ | $ | ||||||||||||
| Direct patient services revenue | ||||||||||||||||
| Costs of revenue: | ||||||||||||||||
| Maintenance and supplies | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Other direct operating costs | ||||||||||||||||
| Other direct operating costs, related party | ||||||||||||||||
| Gross margin | ||||||||||||||||
| Selling and administrative expense | ||||||||||||||||
| Interest expense | ||||||||||||||||
| Loss on write down of impaired assets and associated removal costs, net | ||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Bargain purchase gain RI Acquisition, net of deferred income taxes of $88,000 and $1,314,000 | ||||||||||||||||
| Interest and other income, net | ||||||||||||||||
| (Loss) income before income taxes | ( | ) | ( | ) | ( | ) | ||||||||||
| Income tax expense (benefit) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net (loss) income | ( | ) | ( | ) | ( | ) | ||||||||||
| (Less): net loss attributable to non-controlling interests | ||||||||||||||||
| Net (loss) income attributable to American Shared Hospital Services | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
| Net (loss) income per share: | ||||||||||||||||
| (Loss) income per common share - basic | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
| (Loss) income per common share - diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
| Weighted average common shares for basic (loss) earnings per share | ||||||||||||||||
| Weighted average common shares for diluted (loss) earnings per share | ||||||||||||||||
See accompanying notes
AMERICAN SHARED HOSPITAL SERVICES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Unaudited)
| FOR THE THREE AND NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2025 AND 2024 | ||||||||||||||||||||||||||||
| Common Shares | Common Stock | Additional Paid-in Capital | Retained Earnings | Sub-Total ASHS | Non-controlling Interests in Subsidiaries | Total | ||||||||||||||||||||||
| Balances at January 1, 2024 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Stock-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Vested restricted stock awards | ||||||||||||||||||||||||||||
| Capital contributions from non-controlling interests | - | |||||||||||||||||||||||||||
| Cash distributions to non-controlling interests | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Net income (loss) | - | ( | ) | |||||||||||||||||||||||||
| Balances at March 31, 2024 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Vested restricted stock awards | ||||||||||||||||||||||||||||
| RI Acquisition non-controlling interests | - | |||||||||||||||||||||||||||
| Net income | - | |||||||||||||||||||||||||||
| Balances at June 30, 2024 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Vested restricted stock awards | ||||||||||||||||||||||||||||
| RI Acquisition non-controlling interests | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Balances at September 30, 2024 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Balances at January 1, 2025 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Stock-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Vested restricted stock awards | ||||||||||||||||||||||||||||
| Capital contributions from non-controlling interests | - | |||||||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Balances at March 31, 2025 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Vested restricted stock awards | ||||||||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Balances at June 30, 2025 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | - | - | - | |||||||||||||||||||||||||
| Vested restricted stock awards | ||||||||||||||||||||||||||||
| Cash distributions to non-controlling interests | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
| Balances at September 30, 2025 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
See accompanying notes
AMERICAN SHARED HOSPITAL SERVICES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended September 30, |
||||||||
| 2025 |
2024 |
|||||||
| Operating activities: |
||||||||
| Net (loss) income |
$ | ( |
) | $ | ||||
| Adjustments to reconcile net (loss) income to net cash from operating activities: |
||||||||
| Depreciation, amortization, and other |
||||||||
| Loss on write down of impaired assets and associated removal costs, net |
||||||||
| Accretion of debt issuance costs |
||||||||
| Bargain purchase gain RI Acquisition, net of deferred income taxes |
( |
) | ||||||
| Non cash lease expense |
||||||||
| Accretion of unfavorable lease position |
( |
) | ( |
) | ||||
| Deferred income taxes |
||||||||
| Stock-based compensation expense |
||||||||
| Changes in operating assets and liabilities: |
||||||||
| Receivables |
( |
) | ( |
) | ||||
| Prepaid expenses and other assets |
||||||||
| Accounts payable and accrued liabilities |
( |
) | ||||||
| Related party liabilities |
( |
) | ||||||
| Asset retirement obligations, related party |
( |
) | ||||||
| Income taxes payable |
( |
) | ||||||
| Lease liabilities |
( |
) | ( |
) | ||||
| Net cash provided by (used in) operating activities |
( |
) | ||||||
| Investing activities: |
||||||||
| Cash received in excess of cash paid for the RI Acquisition |
||||||||
| Payment for purchases of property and equipment |
( |
) | ( |
) | ||||
| Net cash used in investing activities |
( |
) | ( |
) | ||||
| Financing activities: |
||||||||
| Principal payments on long-term debt |
( |
) | ( |
) | ||||
| Payments on line of credit |
( |
) | ( |
) | ||||
| Advances on line of credit |
||||||||
| Long-term debt financing |
||||||||
| Capital contribution non-controlling interests |
||||||||
| Distributions to non-controlling interests |
( |
) | ( |
) | ||||
| Debt issuance costs long-term debt |
( |
) | ||||||
| Net cash (used in) provided by financing activities |
( |
) | ||||||
| Net change in cash, cash equivalents, and restricted cash |
( |
) | ||||||
| Cash, cash equivalents, and restricted cash at beginning of period |
||||||||
| Cash, cash equivalents, and restricted cash at end of period |
$ | $ | ||||||
| Supplemental cash flow disclosure |
||||||||
| Cash paid during the period for: |
||||||||
| Interest |
$ | $ | ||||||
| Income taxes |
$ | $ | ||||||
| Schedule of non-cash investing and financing activities |
||||||||
| Equipment included in accounts payable and accrued liabilities |
$ | $ | ||||||
| Non-controlling interest RI Acquisition |
$ | $ | ||||||
| Right of use assets and lease liabilities |
$ | $ | ||||||
| Increase to right of use assets and lease liabilities due to a lease modification |
$ | $ | ||||||
| Detail of cash, cash equivalents and restricted cash at end of period |
||||||||
| Cash and cash equivalents |
$ | $ | ||||||
| Restricted cash |
||||||||
| Cash, cash equivalents, and restricted cash at end of period |
$ | $ | ||||||
See accompanying notes
AMERICAN SHARED HOSPITAL SERVICES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Basis of Presentation
In the opinion of the management of American Shared Hospital Services (“ASHS”), the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary for the fair presentation of ASHS consolidated financial position as of September 30, 2025, the results of its operations for the three and nine-month periods ended September 30, 2025 and 2024, and the cash flows for the nine-month periods ended September 30, 2025 and 2024. The results of operations for the three and nine-month periods ended September 30, 2025 are not necessarily indicative of results on an annualized basis. Consolidated balance sheet amounts as of December 31, 2024 have been derived from the audited consolidated financial statements.
These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024 included in the ASHS Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on April 4, 2025.
These condensed consolidated financial statements include the accounts of ASHS and its subsidiaries (the “Company”) including as follows: ASHS wholly owns the subsidiaries American Shared Radiosurgery Services (“ASRS”), PBRT Orlando, LLC (“Orlando”), ASHS-Mexico, S.A. de C.V. (“ASHS-Mexico”), ASHS-Rhode Island Proton Beam Radiation Therapy, LLC (“RI-PBRT”), ASHS-Bristol Radiation Therapy, LLC (“Bristol”), OR21, Inc., and MedLeader.com, Inc. (“MedLeader”); ASHS is the majority owner of Southern New England Regional Cancer Center, LLC (“SNERCC”), Roger Williams Radiation Therapy, LLC (“RWRT”) and Long Beach Equipment, LLC (“LBE”); ASRS is the majority-owner of GK Financing, LLC (“GKF”), which wholly owns the subsidiaries Instituto de Gamma Knife del Pacifico S.A.C. (“GKPeru”) and HoldCo GKC S.A. (“HoldCo”). HoldCo wholly owns the subsidiary Gamma Knife Center Ecuador S.A. (“GKCE”). ASHS-Mexico is the majority owner of AB Radiocirugia y Radioterapia de Puebla, S.A.P.I. de C.V. of Puebla (“Puebla”). GKF is the majority owner of the subsidiaries Albuquerque GK Equipment, LLC (“AGKE”) and Jacksonville GK Equipment, LLC (“JGKE”).
The Company (through ASRS) and Elekta AB (“Elekta”), the manufacturer of the Gamma Knife (through its wholly-owned United States subsidiary, GKV Investments, Inc.), entered into an operating agreement and formed GKF. As of September 30, 2025, GKF provides Gamma Knife units to seven medical centers in the United States in the states of Illinois, Indiana, Mississippi, New Mexico, New York, Oregon, and Texas. GKF also owns and operates
On November 10, 2023, the Company entered into an Investment Purchase Agreement (the “IPA”) with GenesisCare USA, Inc. (the “GenesisCare”) and GenesisCare USA Holdings, Inc. (“GC Holdings”), pursuant to which GenesisCare agreed to sell to the Company its entire equity interest in each of SNERCC and RWRT, (collectively, the “RI Companies”) and to assign certain payor contacts to the RI Companies for a purchase price of $
On April 27, 2022, the Company signed a Joint Venture Agreement with the principal owners of Guadalupe Amor y Bien S.A. de C.V. (“Guadalupe”) to establish Puebla to treat public- and private-paying cancer patients and provide radiation therapy and radiosurgery services in Guadalupe, Mexico. The Company and Guadalupe hold
On June 28, 2024, ASHS-Mexico, signed a Joint Venture Agreement with Hospital San Javier, S.A. de C.V. (“HSJ”) to establish Newco to treat public- and private-paying cancer patients and provide radiosurgery services in Guadalajara, Mexico. The Company and HSJ will hold
The Company formed the subsidiaries Puebla, GKPeru, ASHS-Mexico, and acquired GKCE for the purposes of expanding its business internationally; Orlando and LBE to provide PBRT equipment and services in Orlando, Florida and Long Beach, California, respectively; and AGKE and JGKE to provide Gamma Knife equipment and services in Albuquerque, New Mexico and Jacksonville, Florida, respectively. LBE is not expected to generate revenue within the next two years.
The Company owns
MedLeader was formed to provide continuing medical education online and through videos for doctors, nurses, and other healthcare workers. MedLeader is not operational at this time.
All significant intercompany accounts and transactions have been eliminated in consolidation.
Accounting pronouncements issued and not yet adopted - In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09 Income Taxes (Topic 740) Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires entities, on an annual basis, to disclose: specific categories in the rate reconciliation, additional information for reconciling items that meet a quantitative threshold, the amount of income taxes paid, net of refunds, disaggregated by jurisdiction, income or loss from continuing operations before income tax, income tax expense from continuing operations disaggregated between foreign and domestic, and income tax expense from continuing operations disaggregated by federal, state and foreign. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, and interim reporting periods beginning after December 15, 2025. The adoption of ASU 2023-09 will modify the Company’s disclosures but will not have an impact on our financial position or results of operations.
In November 2024, the FASB issued ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (“ASU 2024-03”) which requires entities to 1. disclose amounts of (a) purchase of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and, (e) depreciation, depletion, and amortization recognized as part of oil-and gas-producing activities, 2. include certain amounts that are already required to be disclosed under current Generally Accepted Accounting Principles in the same disclosures as other disaggregation requirements, 3. disclose a qualitative description of the amounts remaining in relevant expense captions that are not necessarily disaggregated quantitatively, and 4. disclose the total amount of selling expenses, in annual reporting periods, including an entity’s definition of selling expense. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating ASU 2024-03 to determine the impact it may have on its consolidated financial statements.
In July 2025, the FASB issued ASU 2025-05 Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”) which provides (1) all entities with a practical expedient and (2) entities other than public business entities, with an accounting policy election when estimating credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025 and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company is currently evaluating ASU 2025-05 to determine the impact it may have on its consolidated financial statements.
Revenue recognition - The Company recognizes revenues under Accounting Standards Codification (“ASC”) 842 Leases (“ASC 842”) and ASC 606 Revenue from Contracts with Customers (“ASC 606”).
Rental revenue from medical equipment leasing (“leasing”) – The Company recognizes revenues under ASC 842 when services have been rendered and collectability is reasonably assured, on either a fee per use or revenue sharing basis. The terms of the contracts do not contain any guaranteed minimum payments. The Company’s lease contracts typically have a ten-year term and are classified as either fee per use or revenue sharing. Fee per use revenues are recognized at the time the procedures are performed, based on each hospital’s contracted rate and the number of procedures performed. Under revenue sharing arrangements, the Company receives a contracted percentage of the reimbursement received by the hospital. The amount the Company expects to receive is recorded as revenue and estimated based on historical experience. Revenue estimates are reviewed periodically and adjusted as necessary. Some of the Company’s revenue sharing arrangements also have a cost sharing component. The Company records an estimate of operating costs which are reviewed on a regular basis and adjusted as necessary to more accurately reflect the actual operating costs. The operating costs are recorded as other direct operating costs in the condensed consolidated statements of operations. For the three and nine-month periods ended September 30, 2025, the Company recognized leasing revenue of approximately $
Direct patient services income – The Company has stand-alone facilities in Lima, Peru, Guayaquil, Ecuador, and Puebla, Mexico where contracts exist between the Company’s facilities and the individual patients treated at the facility. Under ASC 606, the Company acts as the principal in these transactions and provides, at a point in time, a single performance obligation, in the form of a Gamma Knife or radiation therapy treatment. Revenue related to these treatments is recognized on a gross basis at the time when the patient receives treatment. There is no variable consideration present in the Company’s performance obligation and the transaction price is agreed upon per the stated contractual rate. GKPeru’s payment terms are typically prepaid for self-pay patients and insurance provider payments are paid net 30 days. GKCE’s patient population is primarily covered by a government payor and payments are paid between three and six months following issuance of an invoice. The facility in Puebla currently has a contract with
On May 7, 2024, the Company acquired
Accounts receivable balances under ASC 606 at September 30, 2025 and January 1, 2025 were $
Business segment information - Based on the guidance provided in accordance with ASC 280 Segment Reporting (“ASC 280”), the Company analyzed its subsidiaries which are all in the business of providing radiosurgery and radiation therapy services, either through leasing to healthcare providers or directly to patients, and concluded there are two reportable segments, leasing and direct patient services. As of September 30, 2025, the Company provided Gamma Knife and PBRT equipment to
An operating segment is defined by ASC 280 as a component of an entity that engages in business activities in which it may recognize revenues and incur expenses, that has operating results that are regularly reviewed by the Company’s Chief Operating Decision Maker (“CODM”), and for which its discrete financial information is available. The Company determined
For the periods ended September 30, 2025 and 2024, the Company’s PBRT operations represented a majority of the revenue and net (loss) income attributable to American Shared Hospital Services from the leasing segment, disclosed below. The revenues, depreciation, amortization, and other expense, interest expense, interest income, income tax expense (benefit), net (loss) income attributable to American Shared Hospital Services, and total assets for the Company’s
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Revenues | ||||||||||||||||
| Leasing | $ | $ | $ | $ | ||||||||||||
| Direct patient services | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Depreciation, amortization, and other expense | ||||||||||||||||
| Leasing | $ | $ | $ | $ | ||||||||||||
| Direct patient services | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Interest expense | ||||||||||||||||
| Leasing | $ | $ | $ | $ | ||||||||||||
| Direct patient services | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Interest income | ||||||||||||||||
| Leasing | $ | $ | $ | $ | ||||||||||||
| Direct patient services | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Income tax expense (benefit) | ||||||||||||||||
| Leasing | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Direct patient services | ( | ) | ||||||||||||||
| Total | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Net (loss) income attributable to American Shared Hospital Services | ||||||||||||||||
| Leasing | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Direct patient services | ( | ) | ( | ) | ||||||||||||
| Total | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Total assets | ||||||||
| Leasing | $ | $ | ||||||
| Direct patient services | ||||||||
| Total | $ | $ | ||||||
Note 2. Property and Equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation for Gamma Knife equipment, LINAC units and other equipment is determined using the straight-line method over the estimated useful lives of the assets, which for medical and office equipment is generally between three and ten years, and after accounting for salvage value on the equipment where indicated.
The Company determines salvage value based on the estimated fair value of the equipment at the end of its useful life. As of December 31, 2024, the Company reduced its estimate of salvage value for all remaining domestic Gamma Knife units to $
Depreciation for PBRT equipment is determined using the modified units of production method, which is a function of both time and usage of the equipment. This depreciation method allocates costs considering the projected volume of usage through the useful life of the PBRT unit, which has been estimated at
The following table summarizes property and equipment as of September 30, 2025 and December 31, 2024:
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Medical equipment and facilities | $ | $ | ||||||
| Office equipment | ||||||||
| Construction in progress | ||||||||
| Accumulated depreciation | ( | ) | ( | ) | ||||
| Net property and equipment | $ | $ | ||||||
| Net property and equipment held outside of the United States | $ | $ | ||||||
Depreciation expense recorded in costs of revenue and selling and administrative expense in the condensed consolidated statements of operations for the three and nine-month periods ended September 30, 2025 and 2024 is as follows:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Depreciation expense | $ | $ | $ | $ | ||||||||||||
Note 3. Long-Term Debt Financing
On April 9, 2021, the Company along with certain of its domestic subsidiaries (collectively, the “Loan Parties”) entered into a five year $
On January 25, 2024 (the “First Amendment Effective Date”), the Company and Fifth Third entered into a First Amendment to Credit Agreement (the “First Amendment”), which amended the Credit Agreement to add a new term loan in the aggregate principal amount of $
On December 18, 2024 (the “Second Amendment Effective Date”), the Company and Fifth Third entered into a Second Amendment to the Credit Agreement (the “Second Amendment”), which amended the Credit Agreement to add a new term loan in the aggregate principal amount of $
The long-term debt on the condensed consolidated balance sheets related to the Term Loan, DDTL, Revolving Line, Supplemental Term Loan and Second Supplemental Term Loan was $
The Credit Agreement contains customary covenants and representations, including without limitation, a minimum fixed charge coverage ratio of
On September 30, 2025, the Company received a limited waiver from Fifth Third with respect to its failure to be in compliance with the maximum funded debt to EBITDA ratio covenant in the Credit Agreement as of June 30, 2025 and with respect to the delivery of items following the closing of the Second Amendment. The Loan Parties are in compliance with the Credit Agreement as of September 30, 2025.
The loan entered into with United States International Development Finance Corporation (“DFC”) in connection with the acquisition of GKCE in June 2020 (the “DFC Loan”) was obtained through the Company’s wholly-owned subsidiary, HoldCo and is guaranteed by GKF. The DFC Loan is secured by a lien on GKCE’s assets. The first tranche of the DFC Loan was funded in June 2020. During the fourth quarter of 2023, the second tranche of the DFC loan was funded to finance the equipment upgrade in Ecuador. The amount outstanding under the first tranche of the DFC Loan is payable in
The DFC Loan contains customary covenants including without limitation, requirements that HoldCo maintain certain financial ratios related to liquidity and cash flow as well as depository requirements. On March 28, 2024, HoldCo received a waiver and amendment from DFC for certain covenants as of December 31, 2023 and through December 31, 2024, and amended other covenants and definitions permanently. On March 3, 2025, the Company received an additional waiver from DFC for certain covenants as of December 31, 2024 and through December 31, 2025. HoldCo was in compliance with all debt covenants pursuant to the DFC Loan as amended and waived at September 30, 2025.
In November and December 2024, GKCE obtained two loans with banks locally in Ecuador (the “GKCE Loans”). The GKCE Loans carry interest rates of
If the Company fails to comply with the Credit Agreement covenants or the DFC Loan covenants, the Company’s credit commitments could be terminated and the principal of any outstanding borrowings, together with any accrued but unpaid interest, under the Credit Agreement or the DFC Loan could be declared immediately due and payable. Furthermore, the lenders under the Credit Agreement and the DFC Loan could also exercise their rights to take possession of, and to dispose of, the collateral securing the credit facilities and loans and could pursue additional remedies upon default as set forth in each such agreement.
The accretion of debt issuance costs for the three and nine-month periods ended September 30, 2025 was $
As of September 30, 2025, long-term debt on the condensed consolidated balance sheets was $
| Year ending December 31, | Principal | |||
| 2025 (excluding the nine-months ended September 30, 2025) | $ | |||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| Thereafter | ||||
| $ | ||||
Note 4. Other Accrued Liabilities
Other accrued liabilities consist of the following as of September 30, 2025 and December 31, 2024:
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Professional services | $ | $ | ||||||
| Operating costs | ||||||||
| Other | ||||||||
| Total other accrued liabilities | $ | $ | ||||||
Note 5. Leases
The Company determines if a contract is a lease at inception. Under ASC 842, the Company is a lessor of equipment to various customers. Leases that commenced prior to the ASC 842 adoption date were classified as operating leases under historical guidance. As the Company has elected the package of practical expedients allowing it to not reassess lease classification, these leases are classified as operating leases under ASC 842 as well, as applicable. All of the Company’s lessor arrangements entered into or modified after ASC 842 adoption are also classified as operating leases. Some of these lease terms have an option to extend the lease after the initial term, but do not contain the option to terminate early or purchase the asset at the end of the term. The Company has elected not to recognize right-of-use (“ROU”) assets and lease liabilities that arise from short-term (12 months or less) leases for any class of underlying asset.
The Company’s Gamma Knife and PBRT contracts with health systems are classified as operating leases under ASC 842. The related equipment is included in medical equipment and facilities on the Company’s condensed consolidated balance sheets. As all income from the Company’s lessor arrangements is solely based on procedure volume, all income is considered variable payments not dependent on an index or a rate. As such, the Company does not measure future operating lease receivables.
The Company’s corporate offices were located in San Francisco, California, where it leased approximately
On May 7, 2024, the Company completed the RI Acquisition and acquired
The Company owns and operates a stand-alone Gamma Knife facility in Lima, Peru where it leased approximately
Sublease income for the three and nine-month periods ended September 30, 2025 was $
The Company’s lessee operating leases are accounted for as ROU assets, current portion of lease liabilities, and lease liabilities on the condensed consolidated balance sheets. Operating lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The Company’s operating lease contracts do not provide an implicit rate for calculating the present value of future lease payments. The Company determined its incremental borrowing rate to be approximately
The following table summarizes the maturities of the Company's lessee operating lease liabilities as of September 30, 2025:
| Year ending December 31, | Operating Leases | |||
| 2025 (excluding the nine-months ended September 30, 2025) | $ | |||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| Thereafter | ||||
| Total lease payments | ||||
| Less imputed interest | ( | ) | ||
| Total | $ | |||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Lease cost | ||||||||||||||||
| Operating lease cost | $ | $ | $ | $ | ||||||||||||
| Sublease income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total lease cost | $ | $ | $ | $ | ||||||||||||
| Other information | ||||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities - Operating leases | $ | $ | $ | $ | ||||||||||||
| Weighted-average remaining lease term - Operating leases in years | ||||||||||||||||
| Weighted-average discount rate - Operating leases | % | % | % | % | ||||||||||||
Note 6. Per Share Amounts
Per share information has been computed based on the weighted average number of common shares and dilutive common share equivalents outstanding. The Company calculates diluted shares using the treasury stock method. Because the Company reported a loss for the three-month period ended September 30, 2024 and the nine-month period ended September 30, 2025, the potentially dilutive effects of approximately
The following table sets forth the computation of basic and diluted earnings per share for the three and nine-month periods ended September 30, 2025 and 2024:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Net (loss) income attributable to American Shared Hospital Services | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
| Weighted average common shares for basic (loss) earnings per share | ||||||||||||||||
| Dilutive effect of stock options and restricted stock awards | ||||||||||||||||
| Weighted average common shares for diluted earnings (loss) per share | ||||||||||||||||
| Basic earnings (loss) per share | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
| Diluted earnings (loss) per share | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||
Note 7. Income Taxes
The Company generally calculates its effective income tax rate at the end of an interim period using an estimate of the annualized effective income tax rate expected to be applicable for the full fiscal year. However, when a reliable estimate of the annualized effective income tax rate cannot be made, the Company computes its provision for income taxes using the actual effective income tax rate for the results of operations reported within the year-to-date periods. The Company’s effective income tax rate is highly influenced by relative income or losses reported and the amount of the nondeductible stock-based compensation associated with grants of its common stock options and from the results of international operations. A small change in estimated annual pretax income can produce a significant variance in the annualized effective income tax rate given the expected amount of these items. As a result, the Company has computed its provision for income taxes for the three and nine-month periods ended September 30, 2025 and 2024 by applying the actual effective tax rates to income or reported within the condensed consolidated financial statements through those periods. The provision for income taxes for the nine-month period ended September 30, 2025, included a non-recurring adjustment for unrecognized tax benefits related to foreign taxes of $
On July 4, 2025, President Donald Trump signed the One Big Beautiful Bill Act (“OBBBA”) into law, which is considered the enactment date under U.S. GAAP. This legislation introduces several provisions affecting businesses, including the permanent extension of certain expiring elements of the Tax Cuts and Jobs Act, modifications to the international tax framework, and favorable tax treatment for certain other business provisions. Key corporate tax provisions include existing 21% corporate income tax rate made permanent, the restoration of 100% bonus depreciation, immediate expensing for domestic research and experimental expenditures, changes to Section 163(j) interest limitations, updates to Global Intangible Low Tax Income (GILTI) and Foreign- Derived Intangible Income (FDII) rules, amendments to energy credits, and expanded Section 162(m) aggregation requirements. The OBBBA contains multiple effective dates, with some provisions applicable beginning in 2025. The legislation does not impact the Company’s prior years’ financial statements.
In accordance with ASC 740 Income Taxes, the effects of the new tax law will be recognized in the period of enactment. As a result of the Company’s elections, it is expected that in 2025 U.S. cash taxes will decrease with no material impact to its effective tax rate, valuation allowance or uncertain tax positions.
Note 8. Commitments
As of September 30, 2025, the Company had commitments to purchase and install two Leksell Gamma Knife Esprit Systems (“Esprit”) and two Linear Accelerator (“LINAC”) systems. The Esprit upgrades and one LINAC installation are anticipated to occur in the first or second quarter of 2026 or later at existing customer sites. The remaining LINAC is reserved for a future customer site. Total Gamma Knife and LINAC commitments as of September 30, 2025 were $
As of September 30, 2025, the Company had commitments to service and maintain its Gamma Knife, LINAC, and PBRT equipment. The service commitments are carried out via contracts with Mevion, Elekta, Solutech, and Mobius Imaging, LLC. The Company’s commitment to purchase one LINAC system also includes a
Note 9. Related Party Transactions and Balances
The Company’s Gamma Knife business is operated through its GKF subsidiary in which the Company holds an indirect
The following table summarizes related party activity for the three and nine-month periods ended September 30, 2025 and 2024:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Equipment purchases and de-install costs | $ | $ | $ | $ | ||||||||||||
| Costs incurred to maintain equipment | ||||||||||||||||
| Total related party transactions | $ | $ | $ | $ | ||||||||||||
The Company also had commitments to purchase and install two Esprit units, two LINACs, and service the related equipment of $
Related party liabilities on the condensed consolidated balance sheets consist of the following as of September 30, 2025 and December 31, 2024:
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Accounts payable, asset retirement obligation and other accrued liabilities | $ | $ | ||||||
Note 10. Rhode Island Acquisition
On November 10, 2023, the Company entered into the IPA with GenesisCare and GC Holdings, pursuant to which GenesisCare sold to the Company its entire equity interest in each of the RI Companies and assigned certain payor contacts to the Company for a cash purchase price of $
On April 18, 2024, the parties amended the IPA and GenesisCare agreed to sell a GE Discovery RT CT Simulator (“CT Sim”) to the Company for $
The RI Acquisition has been accounted for as a business combination under ASC 805, which requires, among other things, that purchase consideration, assets acquired, liabilities assumed and non-controlling interest be measured at their fair values as of the acquisition date. The assets acquired were recorded based on valuations derived from estimated fair value assessments and assumptions used by the Company. While the Company believes its estimates and assumptions underlying the valuations are reasonable, different estimates and assumptions could result in different valuations assigned to the individual assets acquired, and the resulting amount of the bargain purchase gain. During the three-month periods ended September 30, 2024 and December 31, 2024, the Company concluded some of the fair value estimates for accounts receivable, non-controlling interests, and unfavorable leasehold interests required adjustment. The adjusted allocations provided below reflect these changes.
The Company recorded medical equipment, facilities and non-controlling interest at fair value as of the Closing Date. Sales comparison and cost approaches were used to value the medical equipment, including assumptions of estimated direct costs associated with acquiring the equipment. Where appropriate, adjustments were made to the direct replacement cost to reflect depreciation and obsolescence. The sales comparison approach was also utilized to value certain assets, involving secondary market research. The cost approach was also used to value the facilities acquired and the unfavorable leasehold interest. The non-controlling interest was recorded at fair value based on the purchase price paid for the acquisition, after any premium or discount derived from the operating agreement with the minority owners.
The Company recorded the preliminary allocation of the purchase price consideration as of the Closing Date, for the three-month period ended June 30, 2024. During each of the three-month periods ended September 30, 2024 and December 31, 2024, the Company concluded some of the fair value estimates for accounts receivable, non-controlling interests, and unfavorable leasehold interests required adjustment. The net effect of these changes was an increase to the bargain purchase gain of $
The major classes of assets and liabilities to which the Company allocated the fair value of the purchase price consideration as of the Closing Date and December 31, 2024 were as follows:
| May 7, 2024 | Remeasurement | December 31, 2024 | ||||||||||
| Cash and cash equivalents | $ | $ | - | $ | ||||||||
| Accounts receivable | ( | ) | ||||||||||
| Medical equipment | - | |||||||||||
| Facilities | - | |||||||||||
| ROU assets | - | |||||||||||
| Unfavorable leasehold interests | ( | ) | ( | ) | ||||||||
| Total assets acquired | ( | ) | ||||||||||
| Accounts payable | ( | ) | - | ( | ) | |||||||
| Lease liabilities | ( | ) | - | ( | ) | |||||||
| Deferred income taxes | ( | ) | ( | ) | ||||||||
| Gain on bargain purchase | ( | ) | ( | ) | ( | ) | ||||||
| Base purchase consideration | ( | ) | ||||||||||
| Non-controlling interest | ( | ) | ( | ) | ||||||||
| CT Sim | ( | ) | - | ( | ) | |||||||
| Cash paid by the Company | $ | $ | - | $ | ||||||||
The Company recognized a bargain purchase, as defined by ASC 805, in connection with the RI Acquisition. The Company purchased the interest in the RI Companies as part of the sale of certain of GenesisCare’s assets in its bankruptcy proceedings, resulting in a bargain purchase. A bargain purchase gain of $
The value of the acquired tangible assets acquired were as follows:
| Fair Value | Average Useful Life (in Years) | |||||||
| Facilities | $ | |||||||
| Medical equipment | ||||||||
| Total medical equipment and facilities acquired | $ | |||||||
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This quarterly report to the SEC may be deemed to contain certain forward-looking statements. The Private Securities Litigation Reform Act of 1995 has established that these statements qualify for safe harbors from liability. Forward-looking statements may include words like we “believe”, “anticipate”, “target”, “expect”, “pro forma”, “estimate”, “intend”, “will”, “is designed to”, “plan” and words of similar meaning. Forward-looking statements describe our future plans, objectives, expectations or goals. Such statements address future events and conditions and include, but are not limited to, such things as capital expenditures, earnings, liquidity and capital resources, financing of our business, government programs and regulations, legislation affecting the health care industry, the expansion of our proton beam radiation therapy business, accounting matters, compliance with debt covenants, completed and potential acquisitions, competition, customer concentration, contractual obligations, timing of payments, technology and interest rates. These forward-looking statements involve known and unknown risks that may cause our actual results in future periods to differ materially from those expressed in any forward-looking statement. Factors that could cause or contribute to such differences include, but are not limited to, such things as our level of debt, the limited market for our capital-intensive services, the impact of lowered federal reimbursement rates, the impact of U.S. health care reform legislation, competition and alternatives to our services, technological advances and the risk of equipment obsolescence, our significant investment in the proton beam radiation therapy business, restrictions in our debt agreements that limit our flexibility to operate our business, our ability to repay our indebtedness, breaches in security of our information technology, and the small and relatively illiquid market for our stock. These lists are not all-inclusive because it is not possible to predict all factors. 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 SEC, including the Annual Report on Form 10-K for the year ended December 31, 2024. Any forward-looking statement speaks only as of the date such statement was made, and we are not obligated to update any forward-looking statement to reflect events or circumstances after the date on which such statement was made, except as required by applicable laws or regulations.
Overview
American Shared Hospital Services is a leading provider of turn-key technology solutions for stereotactic radiosurgery and advanced radiation therapy equipment and services. The main drivers of the Company’s revenue are numbers of sites, procedure volume, and reimbursement. The Company delivers radiation therapy through medical equipment leasing and direct patient services, its two reportable segments. The medical equipment leasing segment, which we also refer to as the Company’s leasing segment, operates by fee-per-use contracts or revenue sharing contracts where the Company shares in the revenue and operating costs of the equipment. The Company leases seven Gamma Knife systems and one PBRT system as of September 30, 2025, where a contract exists between the hospital and the Company.
On May 7, 2024, the Company acquired 60% of the equity interests of the RI Companies, which operate three single-unit radiation therapy facilities in Rhode Island. The Company, through GKF, owns and operates two single-unit Gamma Knife facilities in Lima, Peru and Guayaquil, Ecuador. The Company also owns and operates a single-unit radiation therapy center in Puebla, Mexico, which began treating patients in July 2024. The Company’s facilities in Rhode Island, Peru, Ecuador, and Mexico are considered direct patient services, where a contract exists between the Company’s facilities and the individual treated at the facility.
Based on the guidance provided in accordance with ASC 280, the Company determined it has two reportable segments, leasing and direct patient services. See Note 1 - Basis of Presentation to the condensed consolidated financial statements for additional information. The Company’s Management’s Discussion and Analysis of Financial Condition and Results of Operations reflects activity for both segments and specifically addresses a segment when appropriate to the discussion.
Reimbursement
The Centers for Medicare and Medicaid (“CMS”) has established a 2025 delivery code reimbursement rate of approximately $7,645 ($7,420 in 2024) for a Medicare Gamma Knife treatment. The approximate CMS reimbursement rates for delivery of PBRT for a simple treatment without compensation for 2025 is $578 ($561 in 2024) and $1,276 ($1,362 in 2024) for simple with compensation, intermediate and complex treatments, respectively.
Application of Critical Accounting Policies and Estimates
The Company’s condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles and follow general practices within the industry in which it operates. Application of these principles requires management to make estimates, assumptions and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. These estimates, assumptions and judgments are based on information available as of the date of the condensed consolidated financial statements; accordingly, as this information changes, the condensed consolidated financial statements could reflect different estimates, assumptions and judgments. Certain policies inherently have a greater reliance on the use of estimates, assumptions and judgments and as such have a greater possibility of producing results that could be materially different than originally reported.
The most significant accounting policies followed by the Company are presented in Note 2 to the consolidated financial statements in the Company’s annual report on Form 10-K for the year ended December 31, 2024. These policies along with the disclosures presented in the other condensed consolidated financial statement notes and, in this discussion, and analysis, provide information on how significant assets and liabilities are valued in the condensed consolidated financial statements and how those values are determined. Based on the valuation techniques used and the sensitivity of financial statement amounts, and the methods, assumptions and estimates underlying those amounts, management has identified revenue recognition for revenue sharing arrangements, accounting for business combinations, salvage value on equipment, and the carrying value of property and equipment and useful lives, and as such the aforementioned could be most subject to revision as new information becomes available. The following are our critical accounting policies in which management’s estimates, assumptions and judgments most directly and materially affect the condensed consolidated financial statements:
Revenue Recognition
The Company recognizes revenues under ASC 842 and ASC 606. The Company had seven domestic Gamma Knife units, two international Gamma Knife units, three domestic LINAC units, one international LINAC unit, and one PBRT system in operation in the United States as of September 30, 2025, and ten domestic Gamma Knife units, two international Gamma Knife units, three domestic LINAC units, and one PBRT system in operation in the United States as of September 30, 2024. Five of the Company’s seven domestic Gamma Knife customers are under fee-per-use contracts, and two customers are under revenue sharing arrangements. The seven domestic Gamma Knife contracts operate under the Company’s leasing segment. The Company’s PBRT system at Orlando Health is considered a revenue share contract operating under the leasing segment. The Company’s interest in three single-unit radiation therapy facilities, acquired in Rhode Island in May 2024, and the Company’s single-unit LINAC facility in Puebla, Mexico operate under the Company’s direct patient services segment. The Company, through GKF, also owns and operates two single-unit, international Gamma Knife facilities in Lima, Peru and Guayaquil, Ecuador. These two units economically operate under the Company’s direct patient services segment.
Rental revenue from medical equipment leasing (“leasing”) – The Company recognizes revenues under ASC 842 when services have been rendered and collectability is reasonably assured, on either a fee per use or revenue sharing basis. The terms of the contracts do not contain any guaranteed minimum payments. The Company’s lease contracts typically have a ten-year term and are classified as either fee per use or revenue sharing. Fee per use revenues are recognized at the time the procedures are performed, based on each hospital’s contracted rate and the number of procedures performed. Under revenue sharing arrangements, the Company receives a contracted percentage of the reimbursement received by the hospital. The amount the Company expects to receive is recorded as revenue and estimated based on historical experience. Revenue estimates are reviewed periodically and adjusted as necessary. Some of the Company’s revenue sharing arrangements also have a cost sharing component. The Company records an estimate of operating costs which are reviewed on a regular basis and adjusted as necessary to more accurately reflect the actual operating costs. The operating costs are recorded as other direct operating costs in the condensed consolidated statements of operations. For the three and nine-month periods ended September 30, 2025, the Company recognized leasing revenue of approximately $3,137,000 and $9,699,000 compared to $3,312,000 and $11,464,000 for the same periods in the prior year, respectively. For the three and nine-month periods ended September 30, 2025, $2,127,000 and $5,691,000 of the ASC 842 revenues were for PBRT services compared to $2,316,000 and $7,386,000, respectively.
Direct patient services income – The Company has stand-alone facilities in Lima, Peru, Guayaquil, Ecuador, and Puebla, Mexico where contracts exist between the Company’s facilities and the individual patients treated at the facility. Under ASC 606, the Company acts as the principal in these transactions and provides, at a point in time, a single performance obligation, in the form of a Gamma Knife or radiation therapy treatment. Revenue related to these treatments is recognized on a gross basis at the time when the patient receives treatment. There is no variable consideration present in the Company’s performance obligation and the transaction price is agreed upon per the stated contractual rate. GKPeru’s payment terms are typically prepaid for self-pay patients and insurance provider payments are paid net 30 days. GKCE’s patient population is primarily covered by a government payor and payments are paid between three and six months following issuance of an invoice. The facility in Puebla currently has a contract with one local hospital to cover its eligible patient base and is also treating self-pay patients. Puebla’s payment terms are typically prepaid for self-pay patients and net 30 days for the hospital patients. The Company did not capitalize any incremental costs related to the fulfillment of its customer contracts.
On May 7, 2024, the Company acquired 60% of the interests of the RI Companies. The RI Companies operate three, existing, stand-alone radiation therapy cancer centers in Woonsocket, Warwick and Providence, Rhode Island, where contracts exist between the Company’s facilities and the individual patients treated at the facility. Under ASC 606, the Company acts as the principal in these transactions and provides, at a point in time, a single performance obligation, in the form of radiation therapy treatment. Revenue related to radiation therapy is recognized at the expected amount to be received, based on insurance contracts and payor mix, when the patient receives treatment. There is no variable consideration present in the Company’s performance obligation and the transaction price is agreed upon per the stated contractual rate. Payment terms at these facilities are typically prepaid for self-pay patients and insurance providers are paid net 30 to 60 days. The Company did not capitalize any incremental costs related to the fulfillment of its customer contracts. The Company also concluded the three radiation therapy facilities are part of its direct patient services segment, see further discussion at Note 1 - Basis of Presentation to the condensed consolidated financial statements.
Accounts receivable balances under ASC 606 at September 30, 2025 and January 1, 2025 were $7,981,000 and $6,073,000, respectively. Accounts receivable balances under ASC 606 at September 30, 2024 and January 1, 2024 were $5,357,000 and $1,626,000, respectively. For the three and nine-month periods ended September 30, 2025, the Company recognized direct patient services revenues of approximately $4,034,000 and $10,655,000 compared to $3,687,000 and $7,807,000 for the same periods in the prior year, respectively.
Salvage Value on Equipment
Salvage value is based on the estimated fair value of the equipment at the end of its useful life. The Company determines salvage value based on the estimated fair value of the equipment at the end of its useful life. There is no active resale market of Gamma Knife, LINAC or PBRT equipment, but the Company believes its salvage value estimates were a reasonable assessment of the economic value of the equipment when the contract ends. Prior to January 1, 2025, the Company had five domestic Gamma Knife units with salvage value of $1,050,000. During the year-ended December 31, 2024, the Company concluded the salvage value should be $0 and accounted for this as a change in estimate. There is no salvage value assigned to the two international Gamma Knife units as of September 30, 2025. The Company also has not assigned salvage value to its PBRT or LINAC equipment as of September 30, 2025.
Impairment of Long-lived Assets
The Company assesses the recoverability of its long-lived assets when events or changes in circumstances indicate their carrying value may not be recoverable. Such events or changes in circumstances may include: a significant adverse change in the extent or manner in which a long-lived asset is being used, significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset, an accumulation of costs significantly in excess of the amount originally expected for the acquisition or development of a long-lived asset, current or future operating or cash flow losses that demonstrate continuing losses associated with the use of a long-lived asset, or a current expectation that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The Company assesses recoverability of a long-lived asset by determining whether the carrying value of the asset group can be recovered through projected undiscounted cash flows over their remaining lives. If the carrying value of the asset group exceeds the forecasted undiscounted cash flows, an impairment loss is recognized, measured as the amount by which the carrying amount exceeds estimated fair value. An impairment loss is charged to the condensed consolidated statement of operations in the period in which management determines such impairment.
Business Combinations
Business combinations are accounted for under ASC 805 Business Combinations (“ASC 805”) using the acquisition method of accounting. Under the acquisition method of accounting, all assets acquired, identifiable intangible assets acquired, liabilities assumed, and applicable non-controlling interests are recognized at fair value as of the acquisition date. Costs incurred associated with the acquisition of a business are expensed as incurred. The allocation of purchase price requires management to make significant estimates and assumptions, especially with respect to tangible assets, any intangible assets identified and non-controlling interests. These estimates include, but are not limited to, a market participant’s expectation of future cash flows from acquired customers, acquired trade names, useful lives of acquired assets, and discount rates. See Note 10 - Rhode Island Acquisition to the condensed consolidated financial statements for further discussion on acquisitions.
Accounting Pronouncements Issued and Not Yet Adopted
In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09 Income Taxes (Topic 740) Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires entities, on an annual basis, to disclose: specific categories in the rate reconciliation, additional information for reconciling items that meet a quantitative threshold, the amount of income taxes paid, net of refunds, disaggregated by jurisdiction, income or loss from continuing operations before income tax, income tax expense from continuing operations disaggregated between foreign and domestic, and income tax expense from continuing operations disaggregated by federal, state and foreign. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, and interim reporting periods beginning after December 15, 2025. The adoption of ASU 2023-09 will modify the Company’s disclosures but will not have an impact on our financial position or results of operations.
In November 2024, the FASB issued ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (“ASU 2024-03”) which requires entities to 1. disclose amounts of (a) purchase of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and, (e) depreciation, depletion, and amortization recognized as part of oil-and gas-producing activities, 2. include certain amounts that are already required to be disclosed under current Generally Accepted Accounting Principles in the same disclosures as other disaggregation requirements, 3. disclose a qualitative description of the amounts remaining in relevant expense captions that are not necessarily disaggregated quantitatively, and 4. disclose the total amount of selling expenses, in annual reporting periods, an entity’s definition of selling expense. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating ASU 2024-03 to determine the impact it may have on its consolidated financial statements.
In July 2025, the FASB issued ASU 2025-05 Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”) which provides (1) all entities with a practical expedient and (2) entities other than public business entities, with an accounting policy election when estimating credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025 and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company is currently evaluating ASU 2025-05 to determine the impact it may have on its consolidated financial statements.
Third Quarter and Nine-Month Period 2025 Results
Revenues increased by $172,000 and $1,083,000 to $7,171,000 and $20,354,000 for the three and nine-month periods ended September 30, 2025 compared to $6,999,000 and $19,271,000 for the same periods in the prior year, respectively. Revenues from the Company’s leasing segment decreased by $175,000 and $1,765,000 to $3,137,000 and $9,699,000 for the three and nine-month periods ended September 30, 2025 compared to $3,312,000 and $11,464,000 for the same periods in the prior year, respectively. The decrease in leasing revenue was primarily driven by lower PBRT volumes. Revenues from the Company’s direct patient services segment increased by $347,000 and $2,848,000 to $4,034,000 and $10,655,000 for the three and nine-month periods ended September 30, 2025 compared to $3,687,000 and $7,807,000 for the same periods in the prior year, respectively. The increase in direct patient services revenue was due to revenue generated by the RI Companies following the closing of the RI Acquisition on May 7, 2024 and the Company’s radiation therapy facility in Puebla, Mexico which began treating patients in July 2024.
The Company acquired its interests in the RI Companies on May 7, 2024 and included the financial results from their operations from May 7, 2024, the closing date of the transaction, through September 30, 2025. The Company’s stand-alone radiation therapy facility in Puebla, Mexico began treating patients in July 2024. Radiation therapy revenues generated from the three stand-alone facilities acquired through the RI Acquisition and the radiation therapy facility in Puebla were $2,918,000 and $7,832,000 for the three and nine-month periods ended September 30, 2025, compared to $2,862,000 and $4,754,000 for the same periods in the prior year (when the results of operations of the RI facilities were only included in the Company’s results of operations from May 7, 2024 forward), respectively. Radiation therapy procedures for the three stand-alone facilities acquired through the RI Acquisition and the radiation therapy facility in Puebla were 7,355 and 20,401 for the three and nine-month periods ended September 30, 2025, compared to and 5,186 and 7,785 for the same periods in the prior year, respectively.
Revenues generated from the Company’s PBRT system decreased by $189,000 and $1,695,000 to $2,127,000 and $5,691,000 for the three and nine-month periods ended September 30, 2025, compared to $2,316,000 and $7,386,000 for the same periods in the prior year, respectively. The decrease for the three and nine-month periods ended September 30, 2025, was driven by lower volumes.
The number of PBRT fractions decreased by 102 and 669 to 1,150 and 3,095 for the three and nine-month periods ended September 30, 2025 compared to 1,252 and 3,764 for the same periods in the prior year, respectively. The decrease in PBRT volumes for the three and nine-month periods ended September 30, 2025 was due to what the Company believes are normal, cyclical fluctuations.
Gamma Knife revenue increased by $305,000 and decreased by $300,000 to $2,126,000 and $6,831,000 for the three and nine-month periods ended September 30, 2025 compared to $1,821,000 and $7,131,000 for the same periods in the prior year, respectively. The increase for the three-month period ended September 30, 2025 was due to increased procedure volume from the direct patient services segment, offset by lower procedure volume from the leasing segment. The decrease in Gamma Knife revenue for the nine-month period ended September 30, 2025 was due to a decrease in procedure volume from both the direct patient services and leasing segments.
The number of Gamma Knife procedures increased by 13 and decreased by 128 to 231 and 703 for the three and nine-month periods ended September 30, 2025 compared to 218 and 831 for the same periods in the prior year, respectively. Gamma Knife procedures from the Company’s leasing segment decreased 18% and 15% for the three and nine-month periods ended September 30, 2025 due to the expiration of three customer contracts in December 2024, February 2025, and April 2025. The decrease for the nine-month period ended September 30, 2025 was also impacted by downtime to upgrade a fourth customer to the Esprit. Gamma Knife procedures from the Company’s direct patient services segment, which are the two international Gamma Knife locations, decreased 11% and increased 35% for the three and nine-month periods ended September 30, 2025. The Company completed the equipment upgrade in Peru to a Gamma Knife Esprit in June 2025. Following the upgrade, there was an increase in volume driven by short treatment times. Equipment downtime in Peru during the second quarter of 2025, contributed to lower volumes for the nine-month period ended September 30, 2025. The patient populations in Peru and Ecuador are primarily insured by local government therefore volumes can be impacted by local legislation changes or social and economic factors. The stand-alone facility in Peru signed a new contract with social security in May 2025, but treatment of patients covered by this payor was delayed during the first five months of 2025.
Total costs of revenue decreased by $44,000 and increased by $2,906,000 to $5,585,000 and $16,196,000 for the three and nine-month periods ended September 30, 2025 compared to $5,629,000 and $13,290,000 for the same periods in the prior year, respectively.
Maintenance and supplies and other direct operating costs, related party, increased by $145,000 and $464,000 to $928,000 and $2,645,000 for the three and nine-month periods ended September 30, 2025 compared to $783,000 and $2,181,000 for the same periods in the prior year, respectively. The increase in maintenance and supplies and other direct operating costs, related party, for the three and nine-month periods ended September 30, 2025, was primarily due to maintenance for two of the Gamma Knife Esprit systems and the LINAC in Puebla, Mexico that were previously under warranty.
Depreciation and amortization decreased by $225,000 and $35,000 to $1,441,000 and $4,383,000 for the three and nine-month periods ended September 30, 2025 compared to $1,666,000 and $4,418,000 for the same periods in the prior year, respectively. The decrease in depreciation and amortization for the three and nine-month periods ended September 30, 2025 was due to the expiration of three customer contracts in December 2024, February 2025, and April 2025. The decrease in depreciation expense for the nine-month period ended September 30, 2025 was offset by higher depreciation for upgraded equipment at four of the Company’s Gamma Knife locations, depreciation incurred for the equipment acquired in the RI Acquisition, and the Company’s new facility in Puebla, Mexico. As of December 31, 2024, the Company reduced its estimate of salvage value for all remaining domestic Gamma Knife units to $0. The net effect of the change in estimate, for the three and nine-month periods ended September 30, 2025, was a decrease in net income of approximately$10,000 or $0.00 per diluted share and $103,000 or $0.01 per diluted share, respectively. This change in estimate will be $10,000, or $0.00 per share in future periods, following the expiration of one customer contract in April 2025.
Other direct operating costs increased by $36,000 and $2,477,000 to $3,216,000 and $9,168,000 for the three and nine-month periods ended September 30, 2025 compared to $3,180,000 and $6,691,000 for the same periods in the prior year, respectively. The increase in other direct operating costs for the three and nine-month periods ended September 30, 2025 was due to operating costs from the acquired facilities in Rhode Island and the Company’s new facility in Puebla, Mexico, which are part of the Company’s direct patient services segment and have higher operating costs compared to facilities in the Company’s leasing segment.
Selling and administrative expense decreased by $385,000 and $606,000 to $1,538,000 and $5,092,000 for the three and nine-month periods ended September 30, 2025 compared to $1,923,000 and $5,698,000 for the same periods in the prior year, respectively. The decrease for the three and nine-month periods ended September 30, 2025 was primarily due to lower legal and other costs as these expenses were higher in the 2024 periods, in part, due to the costs and expenses attributable to the Company’s pursuit of new business opportunities, including the RI Acquisition, which closed in May 2024. These decreases were offset, in part, by increased staffing in the sales, finance, and customer retention areas during the 2025 periods.
Interest expense increased by $56,000 and $183,000 to $392,000 and $1,253,000 for the three and nine-month periods ended September 30, 2025 compared to $336,000 and $1,070,000 for the same periods in the prior year, respectively. The increase for the three and nine-month periods ended September 30, 2025 was due to an increase in borrowings, including the Second Supplemental Term Loan received in December 2024.
During the three and nine-month periods ended September 30, 2024, the Company recorded a $263,000 and $3,942,000 net bargain purchase gain related to the RI Acquisition that closed on May 7, 2024. The Company acquired 60% of the equity interests of the RI Companies, which operate three radiation therapy facilities for $2,850,000. The assets acquired exceeded the total purchase price by the bargain purchase amount and the Company recorded this difference as a gain for the nine-month period ended September 30, 2024. During the three-month period ended September 30, 2024, the Company made adjustments to the initial provisional accounting for the RI Acquisition. The net impact of the adjustments resulted in an increase to the net bargain purchase gain of $263,000.
Interest and other income, net, increased by $16,000 and decreased by $40,000 to $63,000 and $172,000 for the three and nine-month periods ended September 30, 2025 compared to $47,000 and $212,000 for the same periods in the prior year, respectively. The increase for the three-month period ended September 30, 2025 was due to nonrecurring, miscellaneous income at the facilities in Rhode Island. This increase was offset by lower interest income received on the Company’s cash, driven primarily by lower average cash balances. The decrease for the nine-month period ended September 30, 2025 was due to a decrease in the interest received on the Company’s cash, driven primarily by lower average cash balances, compared to the same periods in the prior year.
Income tax expense increased by $217,000 and decreased by $52,000 to expense of $48,000 and an income tax benefit of $296,000 for the three and nine-month periods ended September 30, 2025 compared to an income tax benefit of $169,000 and $244,000 for the same periods in the prior year, respectively. The income tax benefit for the nine-month period ended September 30, 2025, included a non-recurring adjustment for unrecognized tax benefits related to foreign taxes of $71,000, which offset income tax expense for the same period, compared to $100,000 for the nine-month period ended September 30, 2024. Excluding this adjustment, income tax benefit for the nine-month period ended September 30, 2025 increased $81,000. The increase in income tax expense for the three-month period ended September 30, 2025 was due to profit at the Company’s direct patient service and leasing international locations. The increase in the income tax benefit for the nine-month period ended September 30, 2025 was primarily due to losses incurred by the Company’s leasing and direct patient services segments, driven by lower overall volume.
Net loss attributable to non-controlling interests increased by $109,000 and $706,000 to a loss of $312,000 and $797,000 for the three and nine-month periods ended September 30, 2025 compared to $203,000 and $91,000 for the same periods in the prior year, respectively. Net income or loss attributable to non-controlling interests represents net income or loss earned by the 40% non-controlling interest in the Rhode Island facilities, the 19% non-controlling interest in GKF, and net income or loss of the non-controlling interests in various subsidiaries controlled by GKF. The change in net income or loss attributable to non-controlling interests reflects the relative profitability of the three Rhode Island facilities and GKF and its subsidiaries.
Net loss attributable to American Shared Hospital Services decreased by $190,000 and increased by $4,436,000 to a net loss of $17,000, or $0.00 per diluted share and a net loss of $922,000 or $0.14 for the three and nine-month periods ended September 30, 2025 compared to a net loss of $207,000, or $0.03 per diluted share and net income of $3,514,000, or $0.54 per diluted share for the same periods in the prior year, respectively. Excluding the net bargain purchase gain from the RI Acquisition in the prior year of $263,000 and $3,942,000, net loss decreased $453,000 and net loss increased $494,000 for the three and nine-month periods ended September 30, 2025. Net loss for the three-month period ended September 30, 2025 decreased due to increased revenues and lower operating and selling and administrative costs. The Company incurred a net loss for nine-month period ended September 30, 2025, due to losses incurred by the leasing and direct patient services segments, driven by lower procedure volume.
Liquidity and Capital Resources
The Company’s primary liquidity needs are to fund capital expenditures as well as support working capital requirements. In general, the Company’s principal sources of liquidity are cash and cash equivalents on hand and the $7,000,000 Revolving Line. As of September 30, 2025, the Company borrowed $2,000,000 on its Revolving Line. The Company had cash, cash equivalents and restricted cash of $5,345,000 at September 30, 2025 compared to $11,275,000 at December 31, 2024. The Company’s cash position decreased by $5,930,000 during the first nine months of 2025 due to payment for the purchase of property and equipment of $9,618,000, payments on long-term debt of $2,101,000, and distributions to non-controlling interests of $21,000. These decreases were offset by net advances on the Revolving Line of $2,000,000, cash provided by operating activities of $3,802,000, and capital contributions from non-controlling interests of $8,000. The Company’s expected primary cash needs on both a short and long-term basis are for capital expenditures, business expansion, working capital, and other general corporate purposes. The Company has scheduled interest and principal payments under its debt obligations of approximately $10,959,000 during the next 12 months.
Working Capital
The Company had working capital at September 30, 2025 of $3,420,000 compared to $15,853,000 at December 31, 2024. The $12,433,000 decrease in working capital was primarily due to decreasing cash, advances on the Revolving Line and an increase in the current portion of long-term debt, net. The Company believes that its cash on hand, cash flow from operations, and other cash resources are adequate to meet its scheduled debt obligations and working capital requirements during the next 12 months; however, as described elsewhere in this Quarterly Report, the Company’s Credit Agreement with Fifth Third matures in April 2026, and, although the Company is optimistic it will be able to negotiate an extension to the Credit Agreement, if the Company is unable to do so, the Company’s liquidity will be adversely impacted and the Company’s ability to satisfy all of its commitments over the next twelve months in accordance with their current terms would be jeopardized. See additional discussion in the “Commitments” section below. The Company, in the past, has secured financing for its Gamma Knife and radiation therapy units. The Company has secured financing for its projects from several lenders and anticipates that it will be able to secure financing on future projects from these or other lending sources, but there can be no assurance that financing will continue to be available on acceptable terms.
Long-Term Debt
On April 9, 2021, the Company along with certain of its domestic subsidiaries (collectively, the “Loan Parties”) entered into a five year $22,000,000 credit agreement (the “Credit Agreement”) with Fifth Third Bank, N.A. (“Fifth Third”). The Credit Agreement includes three loan facilities. The first loan facility is a $9,500,000 term loan (the “Term Loan”) which was used to refinance the domestic Gamma Knife debt and finance leases, and associated closing costs. The second loan facility of $5,500,000 is a delayed draw term loan (the “DDTL”) which was used to refinance the Company’s PBRT finance leases and associated closing costs, as well as to provide additional working capital. The third loan facility provides for a $7,000,000 revolving line of credit (the “Revolving Line”) available for future projects and general corporate purposes. The Company borrowed $2,000,000 on the Revolving Line as of September 30, 2025, which was repaid in July 2025. The facilities have a five-year maturity, which mature on April 9, 2026, and carry a floating interest rate based on the Secured Overnight Financing Rate (“SOFR”) plus 3.0% (7.36% as of September 30, 2025) and are secured by a lien on substantially all of the assets of the Loan Parties and guaranteed by ASHS.
On January 25, 2024 (the “First Amendment Effective Date”), the Company and Fifth Third entered into a First Amendment to Credit Agreement (the “First Amendment”), which amended the Credit Agreement to add a new term loan in the aggregate principal amount of $2,700,000 (the “Supplemental Term Loan”). The proceeds of the Supplemental Term Loan were advanced in a single borrowing on January 25, 2024, and were used for capital expenditures related to the Company’s operations in Puebla, Mexico and other related transaction costs. The Supplemental Term Loan will mature on January 25, 2030 (the “Maturity Date”). Interest on the Supplemental Term Loan was payable monthly during the initial twelve month period following the First Amendment Effective Date. Following that twelve month period, the Company is required to make equal monthly payments of principal and interest to fully amortize the amount outstanding under the Supplemental Term Loan by the Maturity Date. The Supplemental Term Loan is secured by a lien on substantially all of the assets of the Company and certain of its domestic subsidiaries. The First Amendment also replaced the LIBOR-based rates in the Credit Agreement with SOFR-based rates. Pursuant to the First Amendment, advances under the Credit Agreement bear interest at a floating rate per annum equal to SOFR plus 3.00%, subject to a SOFR floor of 0.00%.
On December 18, 2024 (the “Second Amendment Effective Date”), the Company and Fifth Third entered into a Second Amendment to the Credit Agreement (the “Second Amendment”), which amended the Credit Agreement to add a new term loan in the aggregate principal amount of $7,000,000 (the “Second Supplemental Term Loan”). The proceeds of the Second Supplemental Term Loan were advanced in a single borrowing on December 18, 2024, and were used for capital expenditures related to the Company’s domestic Gamma Knife leasing operations and the RI Acquisition and related transaction costs. The Second Supplemental Term Loan will mature on December 18, 2029 (the “Second Maturity Date”). Interest on the Second Supplemental Term Loan is payable monthly during the initial twelve month period following the Second Amendment Effective Date. Following such twelve month period, the Company is required to make equal monthly payments of principal and interest to fully amortize the amount outstanding under the Second Supplemental Term Loan over a period of seven years. All unpaid principal of the Second Supplemental Term Loan and accrued and unpaid interest thereon is due and payable in full on the Second Maturity Date. The Second Supplemental Term Loan is secured by a lien on substantially all of the assets of the Company and certain of its domestic subsidiaries. Pursuant to the First Amendment, advances under the Credit Agreement bear interest at a floating rate per annum equal to SOFR plus 3.00%, subject to a SOFR floor of 0.00%.
The long-term debt on the condensed consolidated balance sheets related to the Term Loan, DDTL, Revolving Line, Supplemental Term Loan and Second Supplemental Term Loan was $16,933,000 and $18,462,000 as of September 30, 2025 and December 31, 2024, respectively. The Company capitalized debt issuance costs of $0 and $97,000 as of September 30, 2025 and December 31, 2024, related to the issuance of the Supplemental Term Loan and Second Supplemental Term Loan.
The DFC Loan contains customary covenants including without limitation, requirements that HoldCo maintain certain financial ratios related to liquidity and cash flow as well as depository requirements. On March 28, 2024, HoldCo received a waiver and amendment from DFC for certain covenants as of December 31, 2023 and through December 31, 2024 and amended other covenants and definitions permanently. On March 3, 2025, the Company received an additional waiver from DFC for certain covenants as of December 31, 2024 and through December 31, 2025. HoldCo was in compliance with all debt covenants pursuant to the DFC Loan as amended and waived at September 30, 2025.
In November and December 2024, GKCE obtained two loans with banks locally in Ecuador (the “GKCE Loans”). The GKCE Loans carry interest rates of 12.60% and 12.78% and are payable in twelve and thirty-six equal monthly installments of principal and interest, respectively. Total long-term debt on the condensed consolidated balance sheets related to the GKCE Loans was $66,000 and $145,000 as of September 30, 2025 and December 31, 2024, respectively. The Company did not capitalize any debt issuance costs related to the GKCE Loans.
If the Company fails to comply with the Credit Agreement covenants or the DFC Loan covenants, the Company’s credit commitments could be terminated and the principal of any outstanding borrowings, together with any accrued but unpaid interest, under the Credit Agreement or the DFC Loan could be declared immediately due and payable. Furthermore, the lenders under the Credit Agreement and the DFC Loan could also exercise their rights to take possession of, and to dispose of, the collateral securing the credit facilities and loans and could take any additional remedies upon default as set forth in each such agreement.
As of September 30, 2025, long-term debt on the condensed consolidated balance sheets was $18,184,000. See Note 3 - Long Term Debt to the condensed consolidated financial statements for additional information.
Commitments
As of September 30, 2025, the Company had commitments to purchase and install two Leksell Gamma Knife Esprit Systems (“Esprit”) and two Linear Accelerator (“LINAC”) systems. The Esprit upgrades and one LINAC installation are anticipated to occur in the first or second quarter of 2026 or later at existing customer sites. The remaining LINAC is reserved for a future customer site. Total Gamma Knife and LINAC commitments as of September 30, 2025 were $7,884,000. There are no deposits on the condensed consolidated balance sheets related to these commitments as of September 30, 2025, nor are there any penalties if the Company decides to not execute these commitments. It is the Company’s current intent to finance substantially all of these commitments. There can be no assurance that financing will be available for the Company’s current or future projects, or at terms that are acceptable to the Company. However, the Company currently has cash on hand of $5,345,000 and capacity under its Revolving Line of $7,000,000 and is actively engaged with financing resources to fund these projects. The Company borrowed $2,000,000 on the Revolving Line as of September 30, 2025, which was repaid in October 2025.
On September 4, 2022, the Company entered into a Maintenance and Support Agreement with Mevion Medical Systems, Inc. (“Mevion”), which provides for maintenance and support of the Company’s PBRT unit at Orlando Health from September 2022 through April 2026. The maintenance for the final service period, September 2025 through April 2026, is $1,184,000.
As of September 30, 2025, the Company had commitments to service and maintain its Gamma Knife, LINAC, and PBRT equipment. The service commitments are carried out via contracts with Mevion, Elekta, Solutech and Mobius Imaging, LLC. The Company’s commitment to purchase one LINAC system also includes a 5-year agreement to service the equipment, respectively. Total service commitments as of September 30, 2025 were $6,870,000. The Gamma Knife and certain other service contracts are paid monthly, as service is performed. The Company believes that cash flow from cash on hand and operations will be sufficient to cover these payments.
Related Party Transactions
The Company’s Gamma Knife business is operated through its 81% indirect interest in its GKF subsidiary. The remaining 19% of GKF is owned by a wholly owned U.S. subsidiary of Elekta, which is the manufacturer of the Gamma Knife. Since the Company purchases its Gamma Knife units from Elekta, there are significant related party transactions with Elekta, such as equipment purchases, commitments to purchase and service equipment, and costs to maintain the equipment.
The following table summarizes related party activity for the three and nine-month periods ended September 30, 2025 and 2024:
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2025 |
2024 |
2025 |
2024 |
|||||||||||||
| Equipment purchases and de-install costs |
$ | 1,243,000 | $ | 524,000 | $ | 4,412,000 | $ | 3,461,000 | ||||||||
| Costs incurred to maintain equipment |
278,000 | 170,000 | 729,000 | 510,000 | ||||||||||||
| Total related party transactions |
$ | 1,521,000 | $ | 694,000 | $ | 5,141,000 | $ | 3,971,000 | ||||||||
The Company also had commitments to purchase and install two Esprit units, two LINACs, and service the related equipment of $11,045,000 as of September 30, 2025.
Related party liabilities on the condensed consolidated balance sheets consist of the following as of September 30, 2025 and December 31, 2024
| September 30, |
December 31, |
|||||||
| 2025 |
2024 |
|||||||
| Accounts payable, asset retirement obligation and other accrued liabilities |
$ | 1,471,000 | $ | 2,270,000 | ||||
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Company does not hold or issue derivative instruments for trading purposes and is not a party to any instruments with leverage or prepayment features. The Company does not have affiliation with partnerships, trusts or other entities whose purpose is to facilitate off-balance sheet financial transactions or similar arrangements, and therefore has no exposure to the financing, liquidity, market or credit risks associated with such entities. At September 30, 2025, the Company had no significant long-term, market-sensitive investments.
Item 4. Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934. These controls and procedures are designed to ensure that material information relating to the Company and its subsidiaries is communicated to the principal executive officer and our principal financial officer. Based on that evaluation, our principal executive officer and our principal financial officer concluded that, as of September 30, 2025, our disclosure controls and procedures were not effective due to the material weakness in our internal controls over financial reporting described in our Annual Report on Form 10-K for the year ended December 31, 2024, with respect to the Company having an insufficient number of personnel and resources with experience to create a proper control environment.
Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
The Company’s remediation plan related to the material weakness in our internal controls identified are to hire sufficient personnel with accounting and financial reporting experience to augment its current staff and to improve the timeliness of our overall effectiveness of the Company’s closing and financial reporting processes, including as described in this paragraph. As previously disclosed, on December 19, 2024, the Company appointed a new Chief Financial Officer who also serves as the Company’s principal financial officer and principal accounting officer. The new Chief Financial Officer has extensive experience and expertise in billing and collections for radiation therapy facilities. During 2024, the Company outsourced its billing cycle for its Rhode Island facilities. In May 2025, the Company hired a Director of Revenue Cycle Management and effective June 1, began preparing to process the Rhode Island revenue cycle internally. Two additional staff members have been hired to support this process internally as well. While this process is still new, the Company expects this change to provide more control and efficiency to this process overall. Also, during the first and second quarters of 2025, the Company utilized resources from a staffing agency and hired an Accounting Manager on a full-time basis in late March 2025 in addition to using third party accounting consulting services. The Company will continue to assess the need for additional resources, especially in the finance and accounting areas, as the Company’s business continues to grow and expand.
The primary element of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects. As management continues to evaluate and work to improve our internal control over financial reporting, management may determine it is necessary to take additional measures to address the material weakness.
Except for the continued implementation of the remediation plan described above, there were no other changes in our internal control over financial reporting during the three-month period ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 1A. Risk Factors
There were no material changes during the period covered in this report to the risk factors previously disclosed in Part 1, Item 1A, of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information.
During the three-month period ended September 30, 2025, none of the Company’s directors or officers adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408(a) of Regulation S-K
Item 6. Exhibit Index
| Incorporated by reference herein |
||||||
| Exhibit Number |
Description |
Form |
Exhibit |
Date |
||
| 10.1 | * | Limited Waiver between Fifth Third Bank, National Association, and American Shared Hospital Services, PBRT Orlando, LLC, GK Financing, LLC, and American Shared Radiosurgery Services | ||||
| 31.1 |
* |
Certification of Principal Executive Officer pursuant to Rule 13a-14a/15d-14a, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
||||
| 31.2 |
* |
Certification of Principal Financial Officer pursuant to Rule 13a-14a/15d-14a, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
||||
| 32.1 |
ǂ |
Certifications of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
||||
| 101.INS |
* |
Inline XBRL Instance Document |
||||
| 101.SCH |
* |
Inline XBRL Taxonomy Extension Schema Document |
||||
| 101.CAL |
* |
Inline XBRL Taxonomy Calculation Linkbase Document |
||||
| 101.DEF |
* |
Inline XBRL Taxonomy Definition Linkbase Document |
||||
| 101.LAB |
* |
Inline XBRL Taxonomy Label Linkbase Document |
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| 101.PRE |
* |
Inline XBRL Taxonomy Extension Presentation Linkbase Document |
||||
| 104 |
* |
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline Instance XBRL contained in Exhibit 101 |
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| * |
Filed herewith. |
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| ǂ |
Furnished herewith. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
AMERICAN SHARED HOSPITAL SERVICES
Registrant
| Date: |
November 14, 2025 |
/s/ Raymond C. Stachowiak |
||||||
| Raymond C. Stachowiak |
||||||||
| Executive Chairman of the Board (principal executive officer) |
||||||||
| Date: |
November 14, 2025 |
/s/ Raymond S. Frech |
||||||
| Raymond S. Frech |
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| Chief Financial Officer (principal financial and principal accounting officer) |
FAQ
What were AMS’s Q3 2025 revenues and net result (AMS)?
How did segment revenues break out for AMS in Q3 2025?
What is AMS’s liquidity and debt position as of September 30, 2025?
Did AMS have any credit agreement updates or waivers?
What future capital commitments has AMS disclosed?
What were AMS’s year-to-date operating cash flows in 2025?
How many AMS shares were outstanding most recently?
