World Health Alternatives, Inc. Reports Quarterly Profits and Soars to New Highs in Revenues, EBITDA and Gross Profits in Third Quarter and Nine Month Financial Results

Business Wire, Nov 22, 2004

PITTSBURGH -- World Health Alternatives, Inc. (OTC BB:WHAI)

--Organic Growth in Third Quarter Up 7% Over Prior Quarter

--Company Expects 2005 Revenues to Exceed $200 Million

--Gross Profit in Third Quarter Rises 114% Over Last Quarter as Acquisition Integrations Continue

--Travel Nurse Solutions Reaches Approximately $5 Million in Sales in Third Quarter

--Sales Increase Over 100% Versus Second Quarter

World Health Alternatives, Inc. (OTC BB: WHAI), a premier medical staffing company that provides medical, professional and administrative staffing services to the healthcare industry, today announced its financial results for the third quarter ended September 30, 2004.

Richard McDonald, President of World Health Alternatives, said, "Our top-line growth has climbed substantially for the second quarter in a row, enabling us to achieve, in a short period of time, a position as one of the top ten specialized medical staffing companies in the country. Since the last reporting period, we have successfully completed two more acquisitions, which we expect to add approximately $109 million to the Company's revenues over the next fiscal year. We have also reduced our overall debt and improved our balance sheet. We believe that our growth has contributed to the consistent rise in our stock price over the past 5 quarters, which, in turn, has resulted in a number of warrant and debt holders converting their positions during the third quarter. These conversions were beneficial to our balance sheet and allowed us to complete our most recent acquisition without having to obtain additional financing. Furthermore, the Company has continued to produce positive cash flow during its acquisition phase while still growing organically. We have also added management and increased the depth of our resources so that we can integrate and run our growing operations platform. The Company, as a whole, is producing consistent results, with incremental increases in key areas. Overall, we believe we are well-positioned to meet the increasing demand for healthcare staffing services that the Company has been experiencing."

Sales for the Company for the three month period ended September 30, 2004 reached $10,543,872, up 1015% from $945,761 for the same three month period ended September 30, 2003. The increase was primarily due to the Company's organic growth and the acquisitions it completed between December 2003 and June 2004. The Company's October 14, 2004 acquisition, Travel Nurse Solutions, Inc., achieved approximately $5 million in sales in its third quarter ended September 30, 2004. The pro forma combined revenue for both World Health and Travel Nurse Solutions for the third quarter was approximately $15.5 million.

Gross profit for the three month period ended September 30, 2004, reached approximately $3,746,828, or 35.5%, which was an increase of 714% when compared to $460,491 for the same quarter in 2003. The Company attributes this growth to the acquisitions as well as strong margins produced by the core business. It can also be attributed to the recent increase in cross selling between multiple product lines and geographic areas. Travel Nurse Solutions' gross profit in the third quarter was $1,317,564.

John Sercu, World Health's Chief Operating Officer, commented, "We rolled out our performance management tool, called the "Game of Work", in the third quarter and the results have been tremendous. Employees are operating at higher efficiencies and long-standing company sales records are being broken on a regular basis. The Company is firing on all cylinders and lead sharing among the Company's divisions is continuing to increase rapidly. This has helped us achieve a higher utilization of the supply of caregivers currently in our database, higher fill ratios and greater satisfaction among clients and consultants. We also recently launched a new benefits program that provides 100% paid healthcare for our consultants, to encourage them to see World Health as a long-term employment relationship. Our leadership and management depth also increased significantly since the last quarter through key leadership promotions and acquisitions. As a result, we are poised to continue assimilating acquisitions as necessary and building out our organic model."

The Company estimates that its earnings before deductions for interest, depreciation and amortization for the three months ended September 30, 2004 was $1,248,766, or $0.04 per share. Travel Nurse Solutions maintained strong profitability in the third quarter, posting approximately $270,000 in net earnings. Incorporating Travel Nurse Solutions' third quarter pro forma earnings before deductions for interest, depreciation and amortization would give the Company an EBITDA of $0.05 for the third quarter.

The Company incurred a total of approximately $717,000 of non-cash amortization expenses in connection with acquisitions that occurred in the second quarter of 2004, the acquisition of Superior Staffing Solutions, Inc. in late December 2003, non-cash accretion of interest related to the issuance of a debenture that was recently converted to equity and $42,000 in one-time expenses. As a direct result of these non-cash and one-time expenses, the Company's net income decreased by $114,818 to a profit of $28,899 from $143,717 for the three months ended September 30, 2004 and 2003, respectively. The pro forma earnings of the combined World Health and Travel Nurse Solutions companies in the third quarter was approximately $483,000 or $0.02 per share.