Ethema Health Corporation released its Q1 2025 financial results after experiencing significant audit review delays and expects to complete Q2 and Q3 2025 reviews within the next 30 to 45 days. The company anticipates restoring its trading status on the OTC-ID market once these reviews are completed and filed. The quarterly results incorporated the recently acquired Aria Kentucky operations from January 9, 2025, marking a significant expansion of the company's behavioral healthcare footprint.
Overall revenue demonstrated substantial growth, increasing from $1.300 million to $3.518 million, with $2.802 million attributed to the newly acquired Aria Kentucky operations. Existing revenue from Florida operations grew by 10.5% to $1.437 million, including revenue from the Boca Raton facility for the first time following licensing delays. This expansion represents a strategic move to increase the company's capacity in the substance use disorder treatment market.
Operating expenses increased significantly from $1.529 million to $4.165 million, primarily driven by personnel costs that rose from $0.727 million to $2.063 million. Of this increase, $1.178 million related to Aria Kentucky operations, while the remaining $0.885 million stemmed from Florida operations, including a full complement of staff at the Boca Raton facility. Rental expense also saw substantial growth from $0.265 million to $0.740 million, with $0.353 million incurred on Kentucky facilities and the remaining increase primarily related to the Boca Raton facility.
The increased operating expenses offset revenue gains, resulting in an operating loss increase from $0.229 million to $0.647 million. However, the company expressed confidence that increased revenues and improved operational efficiencies would lead to a turnaround to operating income in the near term. Notably, cash flow utilized in operations decreased from $0.106 million to $0.073 million, which the company described as encouraging given the significant acquisition and Boca Raton facility launch.
Interest expense and debt discount expense increased from a combined $0.156 million to $0.428 million, primarily due to interest-bearing assumed liabilities and debt funding used to acquire Aria Kentucky assets. The company plans to replace some expensive debt in both Kentucky and Florida operations with a combination of equity and cheaper banking relationship funding. For more detailed information about the company's operations, visit https://www.ethemahealth.com.
CEO Shawn Leon reported that Florida facilities operated at near capacity in July, while Kentucky facilities continued increasing patient census and reached maximum capacity in currently online residential facilities by August. An additional facility in Paducah, Kentucky came online in August, with another dormant residential facility in Morehead, Kentucky expected to launch in November. Construction is underway on the ARIA Kentucky new head office in Morehead, with completion expected in December 2025.
The company highlighted successful integration of Kentucky operations and excellent results from the Joint Commission audit in Florida. The new Kentucky entity will undergo its first CARF accreditation audit at the end of October. These developments signal the company's commitment to maintaining high standards in behavioral healthcare while expanding its treatment capacity across multiple states. The expansion of bed capacity through newly acquired facilities provides significant opportunity to increase customer count, improve revenues, and enhance operating efficiency in the competitive substance use disorder treatment market.
