TIDMCHT
RNS Number : 7662I
Constellation Healthcare Tech, Inc
02 September 2016
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL. THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR THE PURPOSES OF Article 7 of EU Regulation 596/2014.
2 September 2016
Constellation Healthcare Technologies, Inc.
("Constellation Healthcare Technologies", "CHT", "Company" or
the "Group")
Interim Results for the Six Months Ended 30(th) June 2016
Key Performance Indicators
Interim 2016 Interim
2015 FY- 2015
----------------------- ------ --------------- ------------ ------------
REVENUE +78% $57.0 * $32.0 * $76.7 *
----------------------- ------ -------- ----- ------ ---- ------ ----
Income from
Operations +92% $14.5 25% $7.6 24% $19.2 25%
----------------------- ------ -------- ----- ------ ---- ------ ----
Profit Before
Tax +267% $15.4 27% $4.2 13% $11.4 15%
----------------------- ------ -------- ----- ------ ---- ------ ----
EBITDA +121% $21.1 37% $9.6 30% $23.9 31%
----------------------- ------ -------- ----- ------ ---- ------ ----
RCM Revenue +110% $43.6 76% $20.7 65% $50.1 65%
----------------------- ------ -------- ----- ------ ---- ------ ----
RCM EBITDA +139% $16.8 29% $7.0 22% $16.1 21%
----------------------- ------ -------- ----- ------ ---- ------ ----
CASH FROM OPERATIONS +160% $10.9 19% $4.2 13% $15.5 20%
------------------------ ------ -------- ----- ------ ---- ------ ----
* % of revenue
All amounts USD$M
Highlights
-- Revenue Increased by 78% to $57.0M ($32.0M in 2015)
-- 22% organic growth in the RCM business
-- Cash from Operations increased by 19% to $10.9M ($4.2M in 2015)
-- Debt facility paid down in full from internal cash generation
-- 10,000+ US Physicians currently being serviced
-- RCM business revenue increased by 110% to $43.6M ($20.7M in 2015)
-- RCM EBITDA increased by 139% to $16.8M ($7.0M in 2015)
-- Successful acquisition and integration of MDRX Medical Billing
-- Further strengthening of the board with the appointment of Dr. Shawn Zimberg
Paul Parmar, Chief Executive of Constellation Healthcare
Technologies, commented, "CHT has built a robust platform based on
its efficient RCM processes and technologies. Coupled with a tried,
tested and matured methodology of integrating and transitioning new
clients and new business onto this highly scalable platform, this
platform and experience allows CHT to rapid growth.
We are now starting to see the benefits of this investment as
evidenced by the 78% increase in revenues with 22% of the revenue
coming from organic growth and very strong cash generated from
operations as evidenced by a 160% increase as compared to the same
period last year. We strongly believe that our platform and our
integration methodology along with the experience we have gained,
uniquely places us to grow the business rapidly through organic
growth and M&A.
At this point in time we feel very confident having delivered
above expectations for the first half of 2016, that we will meet
the markets guidance on revenue as well as profits for the full
year 2016.
Enquiries:
Constellation Healthcare c/o Redleaf Communications
Technologies +44 (0)20 7382
Paul Parmar, Chief Executive 4730
Officer /
Sotirios 'Sam' Zaharis, Chief
Financial Officer
Redleaf Communications - +44 (0)20 7382
PR adviser 4730
Charlie Geller / Sam Modlin constellation@redleafpr.com
finnCap - Nominated Adviser
and Joint Broker
Julian Blunt / Scott Mathieson
- corporate finance
Simon Johnson - corporate +44 (0)20 7220
broking 0568
Stifel Nicholas Europe Limited
- Joint Broker +44 (0)20 7710
Jonathan Senior / Ben Maddison 7600
Chief Executive's Review
2016 started with the closing of the MDRX transaction. The
planning both around the acquisition itself and post-acquisition
has paid off well. The integration of the business into the CHT
platform has been seamless, both from the perspective of the
customer and technology interface. The Company has also been
focused on building a pipeline of future M&A opportunities to
grow the Company and Shareholder value. When analysing a potential
acquisition opportunity a lot of time goes into what happens post
acquisition. This, I believe, is a key factor in the success of our
M&A strategy. Importantly, CHT has never been reliant only on
M&A for its growth and I am glad to report that the Company
continues to win clients organically with 15 new clients won in H1
2016.
With a focus on optimising our capital structure, I was pleased
to report to the market earlier in the year that we had paid off
our debt facility in its entirety from internal cash generation.
This would save the Company approximately $1.4M in interest expense
on a yearly basis and the savings can be utilised in our M&A
programme which yields a far greater return to stakeholders.
Earlier in the year we appointed Dr Shawn Zimberg to our Board
of Directors. Dr. Zimberg brings with him a wealth of experience
especially on the business side of the US healthcare industry and
his insight has already been valuable to us when analysing M&A
targets. We will be adding more U.S. based director's to complement
our business later in the year.
The U.S. healthcare system is going through tremendous change at
the moment. This provides a company like CHT significant
opportunities, especially in an environment where there is
significant cost pressure as well as new rules based changes. Both
Physicians and their practices and hospitals need a partner like
CHT to allow them to significantly cut costs and make their
business more efficient, ultimately benefiting the patient.
Financial Performance
The CHT business continues to outperform with each one of our
business segments showing robust growth in revenue and earnings
over the course of the year. We anticipate that this will continue
throughout the year. The business is very strong and whilst
maintaining organic growth, it can easily be scaled with new
acquisitions which will further cement our earnings for the coming
years.
Our first half revenues increased by 78% from the same period
last year and income from operations increased by 92% to $57M and
our Income from Operations was up by 92% to $14.5M. CHT's EBITDA
increased by a staggering 121% to $21.1M vs the same period in
2015. Our EBITDA margins have also increased by 7% to 37% based on
the same period last year. Finally, cash from operations increased
by 160% to $10.9.0M.
Strategy
CHT is focused on acquiring healthcare service businesses across
the U.S. and improving revenue generation and profitability by
utilizing CHT's proprietary technology. This is coupled with our
efficient processing operation giving CHT a competitive edge. This
acquisition strategy is complemented with the organic growth, which
is a key driver going forward. CHT continues to increase the number
of doctors using its platform and as of December 2015, it has over
10,000 independent practicing and hospital/contracting Physicians
groups using its various service offerings. We expect that number
will continue to grow this year and next.
Outlook
The U.S. healthcare system remains complex and is likely to
continue to evolve to cater for the ever changing demographic as
well as the newly insured, while containing costs at each level.
CHT is well placed to take advantage of this new paradigm. The next
few years remain exciting for our business as we build a truly
scaled healthcare technology platform.
Paul Parmar
Chief Executive Officer
Constellation Healthcare Technologies
Constellation Healthcare Technologies, Inc. and Subsidiaries
Consolidated Balance Sheet
June 30, June 30,
2016 2015
------------------------ -------------------------------
Current assets
Cash and cash equivalents $ 21,901,330 $ 16,812,125
Accounts receivable, net 22,522,077 10,918,116
Inventory 262,868 231,002
Prepaid expenses and other
current assets 621,898 873,974
Deferred tax asset 252,000 252,000
------------------------ -------------------------------
Total current assets 45,560,173 29,087,217
------------------------ -------------------------------
Property and equipment, net 9,195,254 9,713,553
------------------------ -------------------------------
Other long-term assets
Intangible assets, excluding
goodwill 30,135,334 26,158,611
Goodwill 68,949,211 17,643,127
Deferred tax asset 4,610,011 3,816,630
Other assets, net 291,334 205,136
------------------------ -------------------------------
Total other long-term assets 103,985,890 47,823,504
Total assets $ 158,741,317 $ 86,624,274
======================== ===============================
Current liabilities
Accounts payable $ 6,156,568 $ 4,163,003
Accrued expenses 3,694,203 2,019,152
Income taxes payable 5,872,756 1,907,646
Current portion of capital
lease obligation 552 15,198
Current portion of long-term
debt 4,836,376 4,828,367
Current portion of contingent
consideration 2,713,733 -
Payable to related party 800,000 -
Payable to Sellers 1,346,881 -
Total current liabilities 25,421,069 12,933,366
------------------------ -------------------------------
Long-term liabilities
Long-term debt, net of current
portion 7,516,447 12,137,754
Contingent consideration 5,574,124 884,412
Deferred rent liability 637,427 493,282
Deferred tax liability 7,541,322 4,086,029
Total long-term liabilities 21,269,320 17,601,477
------------------------ -------------------------------
Commitments and Contingencies
Stockholders' equity (deficit)
Common stock, par value
$0.0001; 150,000,000 shares
authorized at June 30, 2016
and 111,226,912 shares authorized
at June 30, 2015; 83,829,435
shares issued and outstanding
at June 30, 2016 and 64,990,623
shares issued and outstanding
at June 30, 2015. 8,384 6,500
Additional paid-in capital 91,333,963 49,163,636
Retained earnings 20,730,019 6,919,295
Accumulated other comprehensive
loss (126,426) -
Total stockholders' equity 111,945,940 56,089,431
Non-controlling interest
in consolidated entity 104,988 -
Total liabilities and stockholders'
equity $ 158,741,317 $ 86,624,274
======================== ===============================
Constellation Healthcare Technologies, Inc. and Subsidiaries
Consolidated Statements of Operations
Six months Six months
ended ended
---------------------------- ---------------------------------
June 30, June 30,
2016 2015
---------------------------- ---------------------------------
Net revenues $ 56,990,373 $ 31,991,628
---------------------------- ---------------------------------
Operating expenses:
Salaries and benefits 18,584,944 9,934,320
Facility rent and related
costs 1,990,286 1,468,338
Depreciation 1,457,093 653,572
Amortization 5,128,200 1,338,551
Professional and consulting
fees 8,494,722 6,085,660
Insurance 370,386 199,399
Provision for doubtful
accounts 327,352 207,417
Vaccines and medical
supplies 2,095,383 1,946,348
Office and computer
supplies 182,228 109,065
Postage and courier 978,342 922,127
Other 2,893,252 1,566,941
Total operating expenses 42,502,188 24,431,738
---------------------------- ---------------------------------
Income from operations 14,488,185 7,559,890
---------------------------- ---------------------------------
Other income (expenses):
Interest expense (994,590) (1,375,865)
Change in fair value
of contingent consideration 2,115,774 -
Other expense, net (247,805) (2,014,967)
---------------------------- ---------------------------------
Total other income (expenses),
net 873,379 (3,390,832)
---------------------------- ---------------------------------
Income before provision
for income taxes 15,361,564 4,169,058
Provision for income
taxes 6,351,330 1,816,874
---------------------------- ---------------------------------
Net income $ 9,010,234 $ 2,352,184
============================ =================================
Loss from consolidated
entity attributable to non-controlling
interest (144,380) -
Net Income attributable
to the company 9,154,614 2,352,184
Other Comprehensive gain,
net of tax
Foreign currency translation
adjustments (46,907) -
Other Comprehensive gain (46,907)
Comprehensive Income $ 9,107,707 $ 2,352,184
============================ =================================
Income per common shares
Basic
Common Stock $ 0.11 $ 0.04
Diluted
Common Stock $ 0.11 $ 0.04
Weighted average number
of shares for basic
Common Stock 83,330,704 57,066,420
Weighted average number
of shares for Diluted
Common Stock 83,330,704 57,066,420
Constellation Healthcare Technologies, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
Six months Six months
ended ended
-------------------------------- ------------------------------
June 30, June 30,
2016 2015
-------------------------------- ------------------------------
Cash Flow from operating activities:
Net Income $ 9,750,755 $ 2,352,184
Adjustments to reconcile net
income to net cash provided
by operating activities:
Provision for doubtful accounts 327,352 207,417
Depreciation 1,457,093 653,572
Amortization 5,128,200 1,338,551
Deferred Tax 1,018,264 131,086
Change in fair value of
contingent consideration (2,115,774) -
Amortization of deferred
finance fees 170,605 164,947
Foreign currency exchange
loss (46,907) -
Changes in operating assets
and liabilities:
Accounts receivable (8,372,253) (2,524,532)
Inventory (13,435) 151,742
Prepaid expenses and other
assets (16,153) (210,332)
Deferred offering cost -
Other assets (13,178) 28,376
Accounts payable, accrued
expenses 1,371,055 181,018
Income tax payable 3,040,458 1,685,788
Other liabilities - -
Net cash provided by operating
activities 10,945,561 4,159,816
-------------------------------- ------------------------------
Cash flows from investing activities
Cash outlay for property and
equipment (273,132) (6,196,762)
Development of software tool - (2,409,584)
Cash Paid for Acquisition (31,800,000) (12,800,000)
Net cash used in investing
activities (32,073,132) (21,406,346)
-------------------------------- ------------------------------
Cash flows from financing activities
Payments of capital lease
obligations (1,620) (13,909)
Payments on long term loan (2,431,465) (3,739,395)
Payments on acquisition note
payable (36,805) -
Loan from related party 800,000 -
Contribution from parent - 1,000,000
Proceeds from sale of stock,
net of related fees 42,182,412 18,675,622
Net cash provided by financing
activities 40,512,522 15,922,318
-------------------------------- ------------------------------
Net increase/(decrease) in
cash and cash equivalents 19,384,951 (1,324,212)
Cash and cash equivalents,
beginning of period 2,516,379 18,136,336
Cash and cash equivalents,
end of period $ 21,901,330 $ 16,812,125
================================ ==============================
Supplemental Cash Flow Information
Cash Paid for interest $ 823,985 $ 1,210,918
Cash Paid for Income Taxes $ 2,240,354 $ 1,050,000
CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY
SIX MONTHSED JUNE 30, 2016
Common Stock
---------------------------------------------
Shares Amount Paid-in Retained Accumulated Non-controlling Total
Capital Earnings other comprehensive interest
loss in consolidated
entity
----------------- --------------------- ------------------ ----------------------- --------------------------- --------------------------- -------------------
Balances, January
1, 2015 55,615,056 $ 5,562 $ 29,488,952 $ 4,567,111 $ - $ - $ 34,061,625
Proceeds from
sale
of stock, net of
related fees 9,375,567 938 18,674,684 - - - 18,675,622
Contribution from
parent - - 1,000,000 - - - 1,000,000
Net income for
the
period ended
June
30, 2015 - - - 2,352,184 - - 2,352,184
----------------- --------------------- ------------------ ----------------------- --------------------------- --------------------------- -------------------
Balances, June
30,
2015 64,990,623 $ 6,500 $ 49,163,637 $ 6,919,295 $ - $ - $ 56,089,431
================= ===================== ================== ======================= =========================== =========================== ===================
Balances, January
1, 2016 64,990,623 $ 6,500 $ 49,163,637 $ 11,575,405 $ (79,519) $ 249,368 $ 60,915,391
Proceeds from
sale
of stock, net of
related fees 18,814,962 1,881 42,120,329 - - - 42,122,210
Shares issued
towards
NEMS contingent
consideration 23,850 3 49,997 - - - 50,000
Other
Comprehensive
Loss - - - - (46,907) - (46,907)
Non-controlling
interest in
consolidated
entity - - - - - (144,380) (144,380)
Net income for
the
period ended
June
30, 2016 - - - 9,154,614 - - 9,154,614
Balances, June
30,
2016 83,829,435 $ 8,384 $ 91,333,963 $ 20,730,019 $ (126,426) $ 104,988 $ 112,050,929
================= ===================== ================== ======================= =========================== =========================== ===================
1. Segment reporting information
Six months Six months
ended June ended June
30, 2016 30, 2015
------------------------------------ ----------------------------------
Revenue Cycle Management
Revenues $ 43,552,541 $ 20,738,066
Depreciation and amortization 5,506,518 1,973,763
Operating income before
depreciation and amortization 16,778,130 7,030,222
GP & Corporate
Revenues 4,417,982 2,445,129
Depreciation and amortization 1,077,032 15,299
Operating income before
depreciation and amortization 3,473,914 1,895,069
Practice Management:
Revenues 9,019,850 8,808,433
Depreciation and amortization 1,743 3,061
Operating income before
depreciation and amortization 821,434 626,723
Corporate expenses that are incurred for the Company's general
administration have not been apportioned to other business
segments. These costs are grouped under General Purchasing and
Corporate segment
The operating segments are identified and reported on the basis
of internal reports about components of the group that are
regularly reviewed by the Management Board to assess the
performance of the segments.
The group's internal management reporting is structured
primarily on the basis of the market segments in which the 3
operating segments - Revenue Cycle Management, Practice Management
and General Purchasing (GP) & Corporate - operate.
Management assesses the performance of segments based on the
measures of revenue and earnings before depreciation, interest and
taxes (EBITDA), whereby the EBITDA measure includes allocations of
expenses from supporting functions within the group.
Company runs shared services for each of its three segments. All
resources, who form part of general management &
administration, HR, finance and accounting, IT, call center are
part of shared services that are used by one or more segments and
have been included in the reallocation.
Such allocations have been determined by the best management
estimates based on number of resources served, volume of
transactions processed and or relevant measures that reflect the
level of benefits of these functions to each of the operating
segments. As the 3 operating segments serve only external
customers, there is no inter-segment revenue. Interest income and
expenses and tax are not allocated to the segments. There is no
measure of segment (non-current) assets and/or liabilities provided
to the Management Board.
.
Reconciliation of reportable segment revenues and profit to the
consolidated totals
Six months Six months
ended June ended June
30, 2016 30, 2015
--------------------------------------- ---------------------------------
Total Revenues for
reportable segments $ 56,990,373 $ 31,991,628
Total Consolidated
revenues 56,990,373 31,991,628
======================================= =================================
EBITDA for reportable
segments $ 21,073,478 $ 9,552,013
Depreciation & amortization (6,585,293) (1,992,123)
Interest expense (994,590) (1,375,865)
Change in fair value
of contingent consideration 2,115,774
Other income (expense),
net (247,805) (2,014,967)
Provision for income
taxes (5,610,809) (1,816,874)
Net income $ 9,750,755 $ 2,352,184
======================================= =================================
2. Intangible Assets, excluding Goodwill, net
Intangible assets, excluding goodwill, net consist of the
following at June 30, 2016 and 2015:
June 30, June 30,
2016 2015
----------------------------- --------------------------------
Software tool
- work in progress $ 17,083,401 $ 14,608,919
Client relationships 11,862,138 11,673,787
Management service
agreements 2,000,000 2,000,000
Group Purchasing
agreements 600,000 600,000
Trade Name 3,349,536 1,450,869
Non-Compete 6,598,047 15,000
----------------------------- --------------------------------
41,493,122 30,348,575
Less accumulated
amortization (11,357,788) (4,189,964)
----------------------------- --------------------------------
Net amount $ 30,135,334 $ 26,158,611
----------------------------- --------------------------------
Estimated future annual amortization of our identifiable
intangible assets is as follows:
Period ending:
Six months ended
December 31, 2016 $ 5,128,206
Year ended December
31, 2017 10,256,411
Year ended December
31, 2018 9,242,392
Year ended December
31, 2019 2,754,694
Year ended December
31, 2020 1,356,958
Thereafter 1,396,673
Total $ 30,135,334
=====================
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR FFLLBQKFLBBZ
(END) Dow Jones Newswires
September 02, 2016 02:00 ET (06:00 GMT)
Constellation Healthcare (LSE:CHT)
Historical Stock Chart
From Oct 2024 to Nov 2024
Constellation Healthcare (LSE:CHT)
Historical Stock Chart
From Nov 2023 to Nov 2024
