- WELL achieved record quarterly revenue of $10,227,000 during the 3 months ended
March 31, 2020 representing 38% YoY
growth, with an Adjusted EBITDA(1) loss of $245,932.
- WELL EMR Group digital services revenue was $1,704,299 for the quarter representing 918% YoY
growth. These revenues are predominantly high margin recurring SaaS
revenue from the Company's OSCAR
EMR(2) related services.
- WELL's VirtualClinic+ telehealth service is experiencing strong
growth as the Company has now onboarded well over 800 healthcare
practitioners since launching at the beginning of March and has now
surpassed over 1,000 virtual booked appointments(3) per
day.
- The Company's clinical revenue is proving to be highly
resilient as the corporate owned clinics continue to remain open
throughout the COVID-19 pandemic and WELL's physicians were able to
leverage WELL's fully OSCAR EMR
compatible telehealth platform, VirtualClinic+.
- WELL has expanded its EMR footprint to over 1,500 clinics and
more than 8,000 physicians with the acquisition Oscarservice Inc.
dba Trinity Health Technologies ("THT") in the first quarter and
the subsequent acquisition of MedBASE Software Inc. ("MedBASE") on
May 1, 2020.
VANCOUVER, May 15, 2020 /CNW/ - WELL Health
Technologies Corp. (TSX: WELL)
(the "Company" or "WELL"), a company
focused on consolidating and modernizing clinical and digital
assets within the primary healthcare sector, announces it has filed
its condensed interim consolidated financial statements and
MD&A for Fiscal First Quarter 2020 ended March 31, 2020.
![TSX: WELL (CNW Group/WELL Health Technologies Corp.) TSX: WELL (CNW Group/WELL Health Technologies Corp.)](https://mma.prnewswire.com/media/1168725/WELL_Health_Technologies_Corp__WELL_Health_Reports_Record_Revenu.jpg)
"First quarter 2020 was an eventful quarter for WELL as we
started the quarter by graduating from the TSX Venture to the main
board of the TSX Exchange, we launched our VirtualClinic+
telehealth service and we witnessed the outbreak of the COVID-19
pandemic," said Hamed Shahbazi,
Chairman and CEO of WELL. "While the COVID-19 pandemic
has introduced much uncertainty and disruption to most
industries, we feel enormously fortunate and grateful to be in a
position where we are fully empowered to assist healthcare workers
carry out their business continuity programs and support the
important work that they do, regardless as to whether or not the
care they are providing is carried out onsite at a clinic or
virtually through our telehealth program. All our clinics
have remained open throughout the pandemic and continue to provide
much needed healthcare services during these trying times, while
our VirtualClinic+ has allowed patients and physicians observing
social distancing rules to seamlessly conduct virtual medical
consultations for all kinds of critical and non-critical medical
visits. In addition, our digital EMR business continued to
grow and exhibit the rock-solid SaaS revenue and resiliency that we
have come to observe with this business segment."
Covid-19 Update:
WELL implemented its business continuity plan in the first
quarter resulting in its non-clinical staff working from home while
the Company's corporate owned clinics remained open. Thus
far, WELL's publicly insured clinical revenue is proving to be
robust and highly resilient as a result of: (i) the Company's
omni-channel service strategy, and (ii) a steady stream of patient
visits from the Company's family practice business consisting of
regular rostered patients.
WELL's VirtualClinic+ telehealth service is experiencing
positive growth as patients observing social distancing and
self-isolation measures are turning to telehealth services to meet
their medical needs. WELL's VirtualClinic+ program has
onboarded well over 800 healthcare practitioners since
launching at the beginning of March and has now surpassed over
1,000 virtual patient booked appointments per day.
Furthermore, WELL continues to aggressively
roll-out VirtualClinic+ to its EMR network of over 1,500
clinics across Canada and has
already onboarded more than 500 healthcare practitioners from this
important channel alone.
First Quarter 2020 Financial Highlights:
- WELL achieved record quarterly revenue of $10,227,000 during the 3 months ended
March 31, 2020 compared to revenue of
$7,388,043 generated during the 3
months ended March 31, 2019 - an
increase of 38% driven by digital services revenues of $1,704,299 for the quarter representing 918% YoY
growth.
- Gross Margin(4) percentage increased to 38.5% in the
3 months ended March 31, 2020,
compared to 30.7% in the 3 months ended March 31, 2019 primarily due to the addition of
higher margin digital services revenue.
- Adjusted EBITDA(1) loss was $245,932 for the 3 months ended March 31, 2020, compared to Adjusted EBITDA loss
of $338,465 in the 3 months ended
March 31, 2019. Adjusted EBITDA would
have improved even further; however, WELL started a significant
advertising and promotion program to market VirtualClinic+ in the
last three weeks of the quarter.
- WELL ended the first quarter with a strong balance sheet with
$17,548,102 in cash and cash
equivalents as at March 31,
2020.
First Quarter 2020 Business Highlights:
- On March 26, 2020, the Company
announced a $5.75 million investment
in Insig Corporation ("Insig"), a Canadian leader in telehealth
services. WELL issued 2,625,204 common shares, representing
aggregate consideration of approximately $3.75 million, and a $2
million convertible note loan to Insig. The Company has also
entered into a strategic alliance agreement with Insig which allows
it to commercialize the Insig platform on a private label basis
under the brand "VirtualClinic+".
- On March 23, 2020, the Company
announced a Normal Course Issuer Bid of up to 5,943,822 common
shares (5% of the issued and outstanding shares), commencing on
March 25, 2020 over the next 12-month
period. The Company has not made any purchases under this
plan.
- On March 12, 2020, the Company
announced the closing of a $10,000,000 non-brokered private placement
offering of senior unsecured convertible debentures from a single
large and well-known Canadian institutional investor. On
March 16, 2020, the Company closed an
additional tranche of $1,000,000
convertible debentures to include Mr. Li
Ka-shing and one other investor.
- On March 2, 2020, WELL
successfully launched VirtualClinic+ a unique and comprehensive
national telehealth program that allows family physicians to not
only provide care for their own roster of attached patients but
also provide care to unattached patients across the country.
- In early March 2020, WELL opened
its new dermatology clinic in North
Vancouver known as the "DermLab". The DermLab features three
of Vancouver's eminent
dermatologists who are now treating patients for a variety of
medical dermatology and cosmetic services and has been outfitted
with state-of-the-art equipment that can address more than 20
unique indications on all skin types.
- On February 1, 2020, WELL
completed the acquisition of THT, for approximately $7.5M. THT is the second largest OSCAR service
provider in Canada bringing an
additional ~500 clinics to WELL's EMR network.
Subsequent Events:
- On May 7, 2020, the Company
converted the convertible promissory note issued by Insig on
March 25, 2020 into common shares.
Outstanding principal and interest in the amount of $2,023,497 of the convertible promissory note was
converted into common shares of Insig. Together with the equity
investment the Company made on March 30,
2020, WELL becomes the largest shareholder of Insig.
- On May 1, 2020, WELL announced it
entered into a Memorandum of Understanding with McMaster University's Department of Family Medicine
that authorizes WELL to use the OSCAR brand in perpetuity,
including exclusive use of "OSCAR Pro", "OSCAR Professional" and
"OSCAR McMaster Professional Edition". Furthermore, WELL assumed
responsibility from OSCAR EMR for
stewardship of OSCAR 19 as an OntarioMD-certified EMR Offering,
effective May 1, 2020.
- On May 1, 2020, the Company
completed the acquisition of all the issued and outstanding shares
of MedBASE. The total consideration payable in connection with the
acquisition of MedBASE is approximately $650,000. With the completion of this
acquisition, WELL expands its EMR network to over 1,500 clinics
with more than 8,000 physicians.
- On April 27, 2020, the Company
appointed Tara McCarville to its
Board of Directors and Peter Maclean
resigned from the Board of Directors.
Outlook:
As previously disclosed in the Company's 2019 year end annual
Management Discussion & Analysis, WELL intends to focus
much of its operational efforts in the balance of 2020 to ramping
up its telehealth program, VirtualClinic+, continuing its
efforts to digitally transform and derive efficiencies from its
physical clinic footprint and drive growth in its EMR
portfolio.
The Company's goals for 2020, which are unchanged from last
quarter, are to: (i) achieve organic revenue growth in its
operating businesses; (ii) continue to follow a disciplined
acquisition and capital allocation strategy; and (iii) increase
market share and awareness of its VirtualClinic+ telehealth
service.
Conference Call:
WELL will hold a conference call to discuss its 2020 First
Quarter financial results on Friday, May 15,
2020 at 1:00 pm ET
(10:00 am PT). Please use the
following dial-in numbers: 416-764-8650 (Toronto local), 778-383-7413 (Vancouver local) or 1-888-664-6383
(Toll-Free), with Conference ID: 8842 1948.
Selected Financial Highlights:
Please see SEDAR for complete copies of the
Company's condensed interim consolidated financial statements
and MD&A for the three months ended March 31, 2020.
|
Three months
ended March 31,
2020
|
Three months
ended March 31,
2019
|
|
$
|
$
|
Revenue
|
10,227,000
|
7,388,043
|
Cost of clinical and
digital services
|
(6,285,045)
|
(5,120,550)
|
Gross
Profit(4)
|
3,941,955
|
2,267,493
|
Gross
Margin(4)
|
38.5%
|
30.7%
|
Adjusted
EBITDA(1)
|
(245,932)
|
(338,465)
|
Net loss and total
comprehensive loss
|
(2,014,375)
|
(1,450,248)
|
Net loss per share -
for the period
|
(0.02)
|
(0.02)
|
Weighted average
number of common shares
outstanding (basic and diluted)
|
118,143,317
|
86,295,648
|
|
|
|
Reconciliation of
net income to Adjusted EBITDA (1)
|
|
|
Net loss for the
period
|
(2,014,375)
|
(1,450,248)
|
Depreciation and
amortization
|
728,373
|
391,182
|
Income tax
|
55,649
|
-
|
Interest
income
|
(89,447)
|
(40,803)
|
Interest
expense
|
452,055
|
238,505
|
Rent expense on
finance leases
|
(487,652)
|
(411,517)
|
Stock-based
compensation
|
631,991
|
715,283
|
Time-based earn-out
expense
|
334,415
|
136,247
|
Transaction,
restructuring, & integration costs expensed
|
143,059
|
82,886
|
Adjusted
EBITDA(1)
|
(245,932)
|
(338,465)
|
Footnotes:
|
1.
|
EBITDA is a Non-GAAP
measure. Earnings before interest, tax, depreciation and
amortization ("EBITDA") should not be construed as an alternative
to net income/loss determined in accordance with IFRS. The Company
defines Adjusted EBITDA as EBITDA less net rent expense on premise
leases considered to be finance leases under IFRS and before
transaction, restructuring, and integration costs, time based
earn-out expense, special warrants related expenses and stock based
compensation. EBITDA does not have any standardized meanings
under IFRS and therefore may not be comparable to similar measures
presented by other issuers. The Company believes that
Adjusted EBITDA is a meaningful financial metric as it measures
cash generated from operations.
|
2.
|
OSCAR, an acronym for
"Open Source Clinical Application Resource", is an open-source EMR
or "Electronic Medical Records" system developed by McMaster
University's Department of Family Medicine to inspire
collaboration between the wide spectrum of health professionals
with the goal to drive downstream benefits to patient
care.
|
3.
|
Total Booked
Appointments include the total number of appointments booked by
patients. Once a booking has taken place, this metric is
referred to as a patient visit. There are often a small
number of cancellations or no-shows associated with booked
appointments.
|
4.
|
Gross Profit and
Gross Margin are Non-GAAP measures that do not have any
standardized meaning under IFRS and therefore may not be comparable
to similar measures presented by other issuers. The Company
defines Gross Profit as revenue less cost of clinical and digital
services and Gross Margin as Gross Profit as a percentage of
revenue. Gross Profit and Gross Margin should not be
construed as an alternative for revenue or net loss determined in
accordance with IFRS. The Company believes that Gross Profit
and Gross Margin are meaningful metrics in assessing the Company's
financial performance and operational efficiency.
|
WELL HEALTH TECHNOLOGIES CORP.
Per: "Hamed
Shahbazi"
Hamed Shahbazi
Chief Executive Officer, Chairman and Director
About WELL
WELL is an omni-channel digital health company that operates
Primary Healthcare Facilities, is the third largest digital
Electronic Medical Records (EMR) supplier in Canada and is a national provider of
telehealth services. WELL owns and operates 21 medical
clinics, provides digital EMR software and services to over 1,500
medical clinics across Canada and
is a majority owner of SleepWorks Medical. WELL's overarching
objective is to empower doctors to provide the best and most
advanced care possible while leveraging the latest trends in
digital health. WELL is an acquisitive company that has
completed ten acquisitions and two equity investments. WELL
is publicly traded on the Toronto Stock Exchange under the symbol
"WELL". WELL was recognized as a TSX Venture 50 Company three
years in a row in 2018, 2019 and 2020. To access the Company's
telehealth service, visit: virtualclinics.ca and for corporate
information, visit: www.WELL.company.
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
2020 and the intention to ramp up the telehealth program, drive
efficiencies from clinics, and drive growth from its EMR
portfolio. 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;
WELL's assumptions in making forward-looking statements may prove
to be incorrect; 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.
SOURCE WELL Health Technologies Corp.