Executive Summary

Q3 2020 revenue surged to $6.32M, up 218% year-over-year, driven by the shift to operating facilities directly (Higher Call acquisition and Eastman OTA) despite COVID-related costs .
EPS was $0.01 (basic and diluted), a positive result versus $0.01 in Q3 2019 and an improvement from Q1 2020; operating income was $0.99M as revenue scale offset elevated operating expenses .
Liquidity supported by PPP loans ($1.61M outstanding at quarter-end) and subsequent forgiveness of two loans on Nov 19, 2020, improving near-term cash flows .
Strategic catalysts ahead: reopening Edwards Redeemer in Q1 2021, expected closing of Fairland (29-bed SNF) on Dec 31, 2020, and ongoing rebranding to Selectis Health; management transitioned with a new CFO appointed Nov 30, 2020 .

What Went Well and What Went Wrong

What Went Well
- Direct operations expansion: Eastman OTA effective July 1 and Higher Call (acquired Mar 2) materially increased healthcare services revenue and operating income .
- Management highlighted rebranding and facility repositioning: “We will shortly begin rolling out our rebranding effort… Selectis Health, Inc.” and reopening plans for Oklahoma City facility post renovations .
- PPP support and forgiveness: Received $1.61M PPP loans in April/May; two loans were fully forgiven on Nov 19 (principal $324k and $711k plus interest), easing liquidity pressures .
What Went Wrong
- Regulatory closure: Meadowview (OH) was ordered to relocate all residents by Aug 9, 2020 due to operating deficiencies; facility remains closed pending licensing proceedings, creating revenue loss and potential cost burden .
- Technical debt defaults: Certain mortgage covenants were not met (GL Nursing, Meadowview, Abbeville), and one USDA-backed mortgage is delinquent in installments, raising refinancing risk .
- Controls/timeliness: Disclosure controls remained not effective and Q3 filings were delayed; management disclosed going-concern risks given historical losses despite 2020 profitability .

Financial Results

Metric	Q3 2019	Q1 2020	Q2 2020	Q3 2020
Total Revenue ($USD)	$1,989,103	$3,851,601	$5,130,465	$6,320,161
Net Income Attributable to Common ($USD)	$176,582	$53,600	$1,116,055	$466,677
Operating Income ($USD)	$634,338	$568,077	$1,651,597	$986,954
EPS (Basic, $USD)	$0.01	$0.00	$0.04	$0.01
EPS (Diluted, $USD)	$0.01	$0.00	$0.04	$0.01

Segment breakdown (revenue):

Segment	Q3 2019	Q1 2020	Q2 2020	Q3 2020
Rental Revenue ($USD)	$963,645	$521,012	$623,593	$484,299
Healthcare Revenue ($USD)	$1,025,458	$3,330,589	$4,506,872	$5,835,862

KPIs and balance sheet context:

KPI	Q1 2020	Q2 2020	Q3 2020
PPP Loans Outstanding ($USD)	$0	$1,610,169	$1,610,169
Facilities with Presumptive COVID Cases (#)	2 facilities	4 facilities	3 facilities (8 resident, 23 employee cases in Q3)
Properties Owned (#)	12	12	12
Total Notes/Bonds Principal ($USD)	$39,709,642	$40,688,426	$40,888,274

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Edwards Redeemer reopening (OKC)	Q1 2021	N/A	Plan to reopen post renovations; operate via Tiaps Rehab Center LLC	New
Fairland SNF acquisition closing	Dec 31, 2020 (expected)	N/A	Asset Purchase Agreement signed; closing expected Dec 31, 2020	New
Corporate rebranding	2020–2021	N/A	Chosen Selectis Health; will seek shareholder approval; website rollout	New
Series D Preferred dividends	Quarterly	$7,500 per quarter	Continued, $7,500 declared and/or paid	Maintained

Earnings Call Themes & Trends

(No Q3 call transcript available; themes derived from MD&A and 8-K press releases.)

Topic	Previous Mentions (Q1 & Q2)	Current Period (Q3 2020)	Trend
Shift from leasing to operating	Stated intent to operate more facilities (Q1 MD&A) ; continued emphasis (Q2 MD&A)	Eastman OTA effective July; Higher Call operating, increasing healthcare revenue	Accelerating
COVID-19 operational impact	Initial impact outlined; occupancy and PPE costs rising (Q1)	Ongoing impacts; 3 facilities with cases; mitigation measures	Ongoing headwind
PPP liquidity support	Applications/approvals (Q1 subsequent) ; loans funded (Q2)	Two PPP loans forgiven Nov 19 (post-Q3)	Improving liquidity
Regulatory risk (Meadowview)	Risk noted (Q1)	Facility closed; license proceedings ongoing	Adverse
Management changes	N/A	CFO resignation (Sept 29) and new CFO appointed (Nov 30)	Transition
Rebranding	Noted in Q2 press release	Company reiterates intent to align name with model	Progressing

Management Commentary

“We will also shortly begin rolling out our rebranding effort… Selectis Health, Inc.” and emphasized operating model evolution and facility reopening plans to drive success .
MD&A acknowledges going-concern risks despite year-to-date profitability, citing historical losses and debt covenant technical defaults; management expects to refinance maturities but notes potential impact if unsuccessful .
COVID-19 disclosures emphasize mitigation, adequate PPE, and the expectation that trends could continue and, in some cases, accelerate; the company cannot estimate full impact yet .

Q&A Highlights

No Q3 2020 earnings call transcript was filed; therefore, no analyst Q&A is available [ListDocuments result shows no earnings-call-transcript for Q3].

Estimates Context

Wall Street consensus (S&P Global) for Q3 2020 EPS and revenue was unavailable; attempted retrieval failed due to data limits for this microcap. As a result, no beat/miss assessment versus estimates can be made [GetEstimates errors].

Key Takeaways for Investors

Revenue scale-up from operating facilities directly is the core driver; healthcare revenue reached $5.84M in Q3 versus $1.03M in Q3 2019, offsetting rental revenue declines from closures/operational shifts .
PPP loan forgiveness post-quarter provides tangible cash flow relief, lowering near-term obligations and supporting renovations/reopenings; monitor remaining PPP loan status .
Debt profile includes technical covenant defaults and one delinquent USDA-backed mortgage; refinancing execution remains a key risk and near-term focus .
Meadowview closure represents a continuing drag; licensing outcome will influence asset monetization or operational strategy in Ohio .
Near-term catalysts: Edwards Redeemer reopening in Q1 2021, Fairland acquisition closing on Dec 31, and the broader rebranding to Selectis Health—each can influence narrative and valuation if execution is solid .
Governance/controls: delayed filings and “not effective” disclosure controls underscore execution risks; the appointment of a new CFO is a positive step, but remediation progress should be monitored .
Trading lens: the combination of revenue momentum, PPP relief, and reopening/closing actions creates headline catalysts; however, debt covenant issues and regulatory risks can drive volatility—position sizing should reflect these factors .

SELECTIS HEALTH, INC. (GBCS)·Q3 2020 Earnings Summary