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Jack Nathan Medical Corp. (TSXV: JNH, OTCQB: JNHMF) reported Q4 FY2022 revenues of $4.0 million, a significant increase of 461% from Q4 FY2021. For the fiscal year, total revenues reached $9.6 million, up 150% year-over-year. The Company acquired 5 profitable clinics in British Columbia, estimated to generate annual revenues of $5 million. However, operating expenses rose sharply to $5.99 million in Q4, leading to a loss from operations of $1.97 million. Despite challenges, the Company anticipates continued growth in 2022 through clinic expansion.
Positive
Q4 FY2022 revenues increased 461% to $4.0 million.
Fiscal 2022 revenues rose 150% to $9.6 million.
Acquisition of 5 profitable clinics expected to add $5 million in annual revenue.
Plans to open up to 13 new locations in 2022.
Negative
Operating expenses surged to $5.99 million in Q4, a 121% increase year-over-year.
Loss from operations for FY2022 increased to $7.51 million from $1.35 million in FY2021.
Q4-Fiscal 2022 Revenues of $4.0m Increased 461% over Q4-Fiscal 2021
Fiscal 2022 Revenue of $9.6m Increased 150% over Fiscal 2021
Acquired 5 New Profitable Clinics in B.C in Q4-Fiscal 2022, with Estimated Annual Revenue of $5m
TORONTO--(BUSINESS WIRE)--
Jack Nathan Medical Corp. (TSXV: JNH, OTCQB: JNHMF) (“Jack Nathan Health”, “JNH” or the “Company”) announced today its audited consolidated annual financial results for the fourth quarter of fiscal 2022, and fiscal year ended January 31, 2022. Jack Nathan Health’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”).
Management Commentary
Commenting on the Company’s performance and outlook, Dr. Glenn Copeland, Chief Executive Officer, and Chief Medical Officer stated, “We finished the fiscal year with strong revenues bolstered by the acquisition of five profitable medical clinics in British Columbia. We continued our progress out of the pandemic, by further expanding our footprint, scaling our operations, strengthening our digital platform, and enhancing our foundation for growth. We finished the fiscal year with 20 corporate owned medical locations in Canada as well as 2 Rehab and 5 MedSpa locations. In Mexico, we turned profitable in November 2021 and expect that to continue. We also strengthened our operational and financial infrastructure and appointed our new COO, Marcy Herriman. We now have new and stronger plans for rapid growth within Walmart stores in Canada, under a new financing arrangement recently concluded with Walmart Canada, which will continue to accelerate our goal of improving access to high quality healthcare, while enhancing the patient-practitioner experience.”
Dr. Copeland continued, “We have endured a difficult year for healthcare globally, but we have solidified our opportunity for many new omni-channel medical clinics inside Walmart in 2022 and beyond. The Company has plans for as many as 13 new locations in 2022, with 3 already in the planning and construction phases. Our team and JNH remains highly committed to this growth plan and driving added value to our shareholders.”
David Berman, Chief Financial Officer added, “We achieved significant growth during a very challenging year, impacted by the global pandemic and recurring restrictions and lockdowns that affected patient care and clinic operations as well as completing an internal restructuring. With all the economic and external challenges, the Company was able to establish a strong corporate owned and operated clinic footprint with significant new revenues that drive new clinic profits to the overall bottom line. Consequently, we saw tremendous growth in total Q4 revenue to over $4 million, up 461% over Q4 in the previous year. As the effects of Covid lessen in both of the countries we operate in, we anticipate clinics will continue to get busier while addressing the backlog of medical and paramedical demand and this is anticipated to drive further positive cash flow, and improved bottom-line performance.”
Financial Highlights for the Three Months and Year Ended January 31, 2022
Operating Results
Three months ended January 31
Year ended January 31
2022
2021
2022
2021
$
$
$
$
Revenues
4,017,852
716,458
9,638,894
3,852,372
Operating expenses
(5,987,695)
(2,703,447)
(17,146,458)
(5,207,011)
Loss from operations
(1,969,843)
(1,986,989)
(7,507,564)
(1,354,639)
Adjusted EBITDA
(710,242)
(642,269)
(2,712,922)
209,627
Note: Please see Management Discussion and Analysis for the fiscal year ended January 31, 2022, for the detailed breakdown and commentary on Adjusted EBITDA(1).
For the three months ended January 31, 2022, total revenues were $4,017,852 (January 31, 2021 - $716,458), an increase of $3,301,394 or 461%. For the year ended January 31, 2022, revenues were $9,638,894 (January 31, 2021 - $3,852,372), resulting an increase of $5,786,522 or 150%. Clinic operations revenues increased significantly due to the newly acquired clinics that opened in fiscal 2022, new medical services offered in Canada, and the expansion of medical clinics throughout Mexico, as well as the COVID-19 testing tent centres opened in Mexico. As of January 31, 2022, the Company owned and operated 20 medical clinic locations, 2 rehab and 5 MedSpa locations in Canada and a total of 115 medical clinics in Mexico. The increase in clinic operations is aligned with the Company’s strategic plan of expanding corporate-owned and operated medical centres with strategic partner Walmart.
For the three months ended January 31, 2022, total operating expenses were $5,987,695 million (January 31, 2021 - $2,703,447) in Q4 fiscal 2021, an increase of $3,284,248. Total operating expenses for the year ended January 31, 2022, were $17,146,458 (January 31, 2021- 5,207,011), an increase of $11,939,447. The year-over-year increase was driven by the growth in Clinic Operation revenues of $5.8m noted above, that resulted in increases in several new expenses related to clinic operations including higher associate fees for new medical services, higher clinic operation costs, higher salaries and wages higher consulting fees and professional fees, higher development costs, new acquisition costs and an increase in non-cash charges of $2.03 million, including Share Compensation Expense, Depreciation and Amortization. The operational increases are primarily attributable to the rapid expansion of medical clinics, medical and paramedical practitioners added, and new Rehab and MedSpa services provided. The rolling lock downs and restrictions during the year adversely affected overall clinic revenues while general overheads were often maintained.
For the three months ended January 31, 2022, the Company reported a loss from operations of $1,969,843 (January 31, 2022 - $1,986,989) a decrease of $17,146. For the year ended January 31, 2022, the Company reported a loss from operations of $7,507,564 (January 31, 2021 - $1,354,639), an increase of $6,152,925. The overall increase in year-to-date loss from operations is attributable to increased expenses associated with growth and the investments to scale operations, which includes $2.03 million in non-cash charges including Share Compensation expense, Depreciation and Amortization. The decrease in operational loss for Q4-FY2022 indicates the normalizing of operational costs and growth in revenue. Nevertheless, for the fiscal year 2022, there were several non-recurring, non-cash, and one-time charges (See Adjusted EBITDA below). The Company expects to improve its operating performance as higher revenues are generated and scale is achieved throughout its medical clinic footprint.
Revised Clinic Operations Agreement in Mexico
In Q4 fiscal 2022, the Company entered into a beneficial new Addendum to the Clinic Operating Agreement with Walmart Mexico, effective November 1, 2021. As a result of the new terms, the Company will now be profitable in Mexico going forward with 108 active clinics, and the Company is working with Walmart Mexico to increase patient engagement and provide new medical services and programs.
Balance Sheet as of January 31, 2022
Cash of $1.1 million (January 31, 2021 - $7.7 million)
Total assets of $8.1 million (January 31, 2021 - $10.7 million)
Total liabilities of $4.1 million (January 31, 2021 - $2.1 million)
Shares Outstanding
As of May 31, 2022, the Company had 83,956,343 common shares outstanding, 7,975,000 stock options outstanding, 397,304 warrants outstanding, 3,250,000 RSUs outstanding and 502,506 DSUs outstanding.
For further information regarding the Company’s financial results for Q4 fiscal 2022, please refer to the audited financial statements for the year ended January 31, 2022 together with corresponding MD&A, available at www.sedar.com and the JNH website https://www.jacknathanhealth.com
About Jack Nathan Medical Corp.
Jack Nathan Medical Corp., operating as Jack Nathan Health®, is one of Canada’s largest healthcare networks. Jack Nathan Health® is an innovative healthcare company that is improving access for millions of patients by co-locating physician and ancillary medical services conveniently located inside Walmart® stores.
Jack Nathan Health® provides an exceptional level of patient care, made possible through patient-centric physicians, a variety of medical services, technology, and programs, designed to put patients first. Our mission is to provide everyone access to the finest quality retail medical centres, with both in-clinic physicians and digital telemedicine, so you and your loved ones can “Live Your Best Life”.
Jack Nathan Health® was established in 2006 and continues to expand its international footprint, delivering exceptional, state-of-the-art, turn-key medical centres. In Canada, the Company has 76 clinics in Walmart locations in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, and Quebec. 20 clinics, 2 Rehab and 5 MedSpa are corporate owned and operated. In Mexico, the Company has 108 corporate owned and operated clinics in Walmart locations.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Appendix:
Certain statements contained in this press release constitute "forward-looking information" as such term is defined in applicable Canadian securities legislation. The words "may", "would", "could", "should", "potential", "will", "seek", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions as they relate to Jack Nathan are intended to identify forward-looking information. All statements other than statements of historical fact may be forward-looking information. Such statements reflect the Company's current views and intentions with respect to future events, and current information available to them, and are subject to certain risks, uncertainties, and assumptions Many factors could cause the actual results, performance or achievements that may be expressed or implied by such forward-looking information to vary from those described herein should one or more of these risks or uncertainties materialize. Such factors include but are not limited to: changes in economic conditions or financial markets; increases in costs; litigation; legislative and other judicial, regulatory, political, and competitive developments; the economic and business impact of COVID-19 and operational difficulties. This list is not exhaustive of the factors that may affect forward-looking information. These and other factors should be considered carefully, and readers should not place undue reliance on such forward-looking information. Should any factor affect the Company in an unexpected manner, or should assumptions underlying the forward-looking information prove incorrect, the actual results or events may differ materially from the results or events predicted. Any such forward-looking information is expressly qualified in its entirety by this cautionary statement. Moreover, the Company does not assume responsibility for the accuracy or completeness of such forward-looking information. The forward-looking information included in this press release is made as of the date of this press release and the Company undertakes no obligation to publicly update or revise any forward- looking information, other than as required by applicable law.
(1)Adjusted EBITDA
We believe Adjusted EBITDA is a useful measure to assess the ongoing performance of our Company as it provides more meaningful operating results by excluding the effects of expenses that are not reflective of our underlying business performance as well as one-time or non-recurring expenses. We define Adjusted EBITDA as EBITDA adjusted to add back or deduct, as applicable, certain expenses, costs, charges, or benefits incurred in the period, which in management’s view, are not indicative of normal operations, including: (i) restructuring costs, (ii) non-capitalized development costs, (iii) acquisition related costs, (iv) share compensation expense, (v) bad debt expense(recovery), (vi) other income (expense), (vii) finance costs (income), (viii) loss on investments at fair value, (ix) write down of investments, (x) foreign exchange gain or loss and (xi) listing expense.
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. 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.
What were the revenue figures for Jack Nathan Medical Corp. for Q4 FY2022?
Jack Nathan Medical Corp. reported Q4 FY2022 revenues of $4.0 million, reflecting a 461% increase over Q4 FY2021.
How much did Jack Nathan Medical Corp. earn in FY2022?
In FY2022, Jack Nathan Medical Corp. generated $9.6 million in revenue, marking a 150% increase from the previous fiscal year.
What new acquisitions did Jack Nathan Medical Corp. make in FY2022?
Jack Nathan Medical Corp. acquired 5 new profitable clinics in British Columbia during Q4 FY2022, which are expected to generate $5 million in annual revenue.
What were the operating expenses for Jack Nathan Medical Corp. in Q4 FY2022?
The operating expenses for Q4 FY2022 were $5.99 million, an increase of 121% compared to $2.70 million in Q4 FY2021.
What is the expected growth outlook for Jack Nathan Medical Corp. in 2022?
Jack Nathan Medical Corp. plans to open up to 13 new locations in 2022 and anticipates continued revenue growth as COVID-19 impacts lessen.
