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WELL Health Technologies Reports Record Revenue and Positive EBITDA in Q4-2020, Full Year Revenue up 53%
Tuesday, March 23, 2021Company Profile | Follow Company
Vancouver, BC, March 23, 2021--(T-Net)--WELL Health Technologies Corp. (TSX: WELL), a company focused on consolidating and modernizing clinical and digital assets within the primary healthcare sector, has announced its fiscal fourth quarter and annual financial results for the three and twelve months ended December 31, 2020.
Hamed Shahbazi, Chairman and CEO of WELL commented, "Q4-2020 was another great quarter for WELL in which we achieved record quarterly revenue and gross profit, but I am most pleased to report that we achieved a significant milestone in the fourth quarter with this being the first time that we've reported positive Adjusted EBITDA(2) which exceeded analysts' predictions. We have proven that our capital allocation model works and moving forward, we are only expecting profitability and cash flows to grow. During Q4 we also completed seven transactions and that pace has continued into Q1 with a number of completed and announced transactions, including the proposed acquisition of CRH Medical."
Mr. Shahbazi added, "CRH Medical is a game-changing transaction for WELL as it accelerates our revenue growth and significantly boosts our free cash flow, which would be used to make additional cash flow generating acquisitions. Earlier this week CRH reported strong financial results which makes us even more excited with the proposed acquisition. CRH reported fourth quarter revenue of US$36.8M which reflected a growth rate of approximately 21% on a YoY basis with healthy Adjusted EBITDA operating margins of over 40%. CRH's fourth quarter performance implies an annualized revenue run-rate of approximately CAD$184M and $80M in Adjusted Operating EBITDA without adjusting for non-controlled interests. Aside from the financial benefits of the deal, CRH is a strong strategic fit for WELL as it provides us with a meaningful U.S. based channel of customers and practitioners to which we can offer a diverse multi-pronged offering of digital health tools and capabilities. The close of our transaction with CRH will signify the very start of our value creation journey with this very special company."
Fiscal 2020 Annual Financial Highlights:
Fourth Quarter 2020 Financial Highlights:
Fourth quarter 2020 Business Highlights:
Proposed acquisition of CRH Medical and Completion of Equity Offering:
Other Events Subsequent to December 31, 2020:
Outlook:
WELL's goals for 2021 are to: (i) achieve organic growth across all of its operating business units; (ii) follow a disciplined acquisition and capital allocation strategy; (iii) grow its positive EBITDA(2) throughout the year; (iv) increase operating cash flows by finalizing key acquisitions, optimizing costs and digitizing clinical assets; and (v) increase market share of its digital health related products and virtual care programs.
WELL continues to have an active pipeline of acquisition opportunities that span across its six business units and include clinical, digital, billing and cybersecurity opportunities. WELL operates as a decentralized organization with each business unit having a fair amount of autonomy, hence WELL looks to attract acquisitions with strong operators to run these businesses and generate profits to support new growth opportunities.
Selected Unaudited Financial Highlights:
Please see SEDAR for complete copies of the Company's audited annual consolidated financial statements and annual MD&A for the year ended December 31, 2020.
Three months |
Twelve months |
Twelve months |
|
$ |
$ |
$ |
|
Revenue |
17,189,370 |
50,240,249 |
32,810,782 |
Cost of sales |
(9,188,130) |
(29,024,783) |
(21,821,367) |
Adjusted Gross Profit(1) |
8,001,240 |
21,215,466 |
10,989,415 |
Adjusted Gross Margin(1) |
46.6% |
42.2% |
33.5% |
Adjusted EBITDA(2) |
765,200 |
(92,012) |
(1,713,414) |
Net profit (loss) |
5,772,483 |
(3,210,653) |
(7,793,914) |
Total comprehensive income (loss) for the period |
5,639,832 |
(3,343,304) |
(7,793,914) |
Net income (loss) per share - for the period, basic and |
0.04 |
(0.03) |
(0.08) |
Weighted average number of common shares |
151,058,782 |
133,911,242 |
96,919,161 |
Weighted average number of common shares |
157,385,159 |
133,911,242 |
96,919,161 |
Reconciliation of net profit (loss) to Adjusted EBITDA |
|||
Net profit (loss) for the period |
5,772,483 |
(3,210,653) |
(7,793,914) |
Depreciation and amortization |
1,867,232 |
4,270,370 |
2,155,046 |
Income tax (recovery) expense |
(4,507,907) |
(4,362,391) |
35,235 |
Interest income |
(218,311) |
(454,379) |
(241,402) |
Interest expense |
335,012 |
1,934,647 |
1,446,057 |
Rent expense on finance leases |
(657,359) |
(2,204,129) |
(1,642,680) |
Stock-based compensation |
1,986,693 |
4,974,781 |
2,935,912 |
Exchange difference |
196,434 |
196,434 |
- |
Change in fair value of investments |
(6,904,815) |
(6,904,815) |
- |
Special warrants related gain |
- |
- |
(243,450) |
Time-based earn-out expense |
627,754 |
1,863,794 |
948,603 |
Share of loss of associates |
341,410 |
586,705 |
|
Transaction, restructuring, & integration costs expensed |
1,926,574 |
3,217,624 |
687,179 |
Adjusted EBITDA(2) |
765,200 |
(92,012) |
(1,713,414) |
|
About WELL Health Technologies Corp.:
WELL is an omni-channel digital health company whose overarching objective is to empower doctors to provide the best and most advanced care possible while leveraging the latest trends in digital health. As such, WELL owns and operates 27 primary healthcare clinics, is Canada's third largest digital Electronic Medical Records (EMR) supplier serving over 2,200 medical clinics, operates a leading national telehealth service in Canada and the United States, and is a provider of digital health, billing and cybersecurity related technology solutions. WELL is an acquisitive company that follows a disciplined and accretive capital allocation strategy. WELL is publicly traded on the Toronto Stock Exchange under the symbol "WELL". To access the Company's telehealth service, visit: tiahealth.com and for corporate information, visit: www.WELL.company.
Footnotes: |
|
(1) |
Non-GAAP measure. Adjusted Gross profit and Adjusted gross margin do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company defines adjusted gross profit as revenue less cost of sales (excluding depreciation and amortization) and adjusted gross margin as adjusted gross profit as a percentage of revenue. Adjusted Gross profit and adjusted gross margin should not be construed as an alternative for revenue or net loss determined in accordance with IFRS. The Company believes that adjusted gross profit and adjusted gross margin are meaningful metrics in assessing the Company's financial performance and operational efficiency. |
(2) |
Non-GAAP measure. Earnings before interest, taxes, depreciation and amortization ("EBITDA") and Adjusted EBITDA should not be construed as alternatives to net income/loss determined in accordance with IFRS. EBITDA and Adjusted EBITDA do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. The Company defines Adjusted EBITDA as EBITDA (i) less net rent expense on premise leases considered to be finance leases under IFRS and (ii) before transaction, restructuring, and integration costs, time-based earn-out expense, special warrants related expenses, change in fair value of investments, share of loss of associate, exchange difference, and stock-based compensation expense. The Company believes that Adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations which the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives. The Adjusted EBITDA figures noted herein have not been adjusted for non-controlled interests. |
Forward-Looking Statements:
This news release may contain "forward-looking statements" within the meaning of applicable Canadian securities laws, including, without limitation: all statements in the "Outlook" section of this news release, including the Company's goals for 2021; the proposed acquisition of CRH Medical and the financing thereof; the expectation that profitability and cash flows will increase on a going forward basis; and that WELL is able to realize on its pipeline of acquisitions, and that such acquisitions will generate profits to support new growth opportunities. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, and contingencies. These statements generally can be identified by the use of forward-looking words such as "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause future results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. WELL's statements expressed or implied by these forward-looking statements are subject to a number of risks, uncertainties, and conditions, many of which are outside of WELL 's control, and undue reliance should not be placed on such statements. Forward-looking statements are qualified in their entirety by inherent risks and uncertainties, including: direct and indirect material adverse effects from the COVID-19 pandemic; adverse market conditions; risks inherent in the primary healthcare sector in general; regulatory and legislative changes; that future results may vary from historical results; inability to obtain future financing on suitable terms; and that market competition may affect the business, results and financial condition of WELL. Except as required by securities law, WELL does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise.
Neither the TSX nor its Regulation Services Provider (as that term is defined in policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.
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WELL Health Technologies Corp.
Vancouver (Other Tech Sectors)
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