Ethema Health Corporation (OTC: GRST) released its Q1 2025 financial results on October 17, 2025, after significant delays related to audit reviews. The company reported total revenue of $3.518 million for the quarter ended March 31, 2025, up from $1.300 million in the same period last year. The growth was primarily driven by the acquisition of Aria Kentucky operations on January 9, 2025, which contributed $2.802 million in revenue. Existing Florida operations, including the newly licensed Boca Raton facility acquired in May 2024, saw revenue increase 10.5% to $1.437 million.
Operating expenses rose sharply to $4.165 million from $1.529 million, led by personnel costs which increased to $2.063 million from $0.727 million. Of this, $1.178 million is attributable to Aria Kentucky, while the remaining $0.885 million increase relates to Florida operations, including a full staff complement at the Boca Raton facility where revenue is still ramping up. Rental expense grew to $0.740 million from $0.265 million, with $0.353 million from Kentucky facilities and $0.122 million from Boca Raton. Patient-related expenses, such as food and utilities, also increased as patient counts rose. Professional fees rose due to one-time deal costs. These higher expenses resulted in an operating loss of $0.647 million, compared to $0.229 million in Q1 2024.
Despite the operating loss, cash flow used in operations improved to $0.073 million from $0.106 million, a positive sign given the acquisition and facility launch. Interest expense and debt discount expense increased to $0.428 million from $0.156 million, primarily due to interest-bearing liabilities assumed in the Aria Kentucky acquisition. The company plans to replace expensive debt with equity and cheaper bank financing.
CEO Shawn Leon provided an operational update, noting that Florida facilities operated at near capacity in July and Kentucky facilities reached maximum capacity in their online residential facilities in August. An additional facility in Paducah, Kentucky, was brought online in August, and another dormant residential facility in Morehead, Kentucky, is expected to open in November. Construction is underway on a new head office in Morehead, expected to be completed in December 2025. Leon highlighted the smooth integration of Kentucky operations and praised the Florida team for excellent Joint Commission audit results. The new Kentucky entity will undergo its first CARF accreditation audit at the end of October.
The company expects Q2 2025 and Q3 2025 reviews to be completed within 30 to 45 days, after which it will restore its trading status on the OTC-ID market. Q2 revenue is projected to increase approximately 40% from Q1, and Q3 revenue another 10%. Leon expressed confidence that increased revenues and improved operational efficiencies will lead to a turnaround to operating income in the near term.
