Syra Health Announces Fourth-Quarter and Full-Year 2023 Financial Results. Projects 2024 Revenue Growth of 64% to 100%.
- Strong revenue performance in 2023 with $5.5 million compared to $5.6 million in 2022.
- Business units excluding Healthcare Workforce grew 250% in 2023, comprising 23% of total revenues.
- Population Health revenues increased by over 125% driven by demand for epidemiology services.
- Digital Health segment saw revenues of $515,250, marking its first year of revenues.
- Gross profit margin increased to 25.6% in 2023 compared to 18.9% in 2022.
- Ending cash balance of $3.3 million and no long-term debt as of December 31, 2023.
- 2024 revenue outlook of $9 to $11 million, representing a growth of 64%-100% versus 2023.
- Significant contract wins with various healthcare organizations and government agencies.
- Product launches including Syrenity for mental health and CarePlus for electronic medical records.
- Successful IPO in September 2023, trading on the NASDAQ.
- None.
Insights
The reported financial results from Syra Health indicate a slight decline in year-over-year revenue, which could potentially raise concerns among investors regarding the company's growth trajectory. However, the substantial growth in the business units excluding Healthcare Workforce, which increased by 250%, may signal a strategic pivot or diversification that could bolster the company's market position in the long term. The increase in gross profit margin by 670 basis points to 25.6% is a strong indicator of improving operational efficiency, possibly reflecting better cost management or a shift towards higher margin services.
Furthermore, the expectation of a significant revenue increase in the upcoming year, projecting a growth of 64%-100%, is ambitious and suggests that management is confident about the company's pipeline and market opportunities. This could be a positive sign for investors looking for growth potential, though it's worth noting that the guidance does not account for potential revenues from a major federal contract, which could lead to further upside if realized.
The absence of long-term debt and a healthy cash balance provides financial stability and may give the company the flexibility to invest in growth opportunities or weather potential market downturns. This financial health is a critical factor for investors when assessing risk and sustainability of a company.
The strategic contracts secured by Syra Health, including the five-year contract with the District of Columbia's Department of Behavioral Health and the one-year contracts for HEDIS® outreach and epidemiology services, showcase the company's ability to attract substantial deals within the healthcare sector. These contracts not only contribute to the revenue stream but also establish Syra Health's credibility and presence in the healthcare consulting market.
The launch of new products like Syrenity and CarePlus indicates the company's commitment to innovation and addressing market needs, particularly in the mental health and EMR system domains. These product launches could open up new revenue streams and potentially create a competitive edge in the market.
However, it's important to assess the adoption rate and market reception of these new products, as well as the competitive landscape, to gauge the potential impact on the company's financial performance. The emphasis on higher-margin business units could lead to improved profitability, but it remains to be seen how these units will scale and contribute to the overall financial health of the company.
The expansion of Syra Health's operations to 17 states demonstrates a strategic initiative to capture a larger market share and diversify its geographic footprint. This broadened reach could make the company more resilient to regional market fluctuations and provide a wider base for client acquisition. The focus on burgeoning business units such as Population Health, Behavioral and Mental Health, Digital Health and Health Education is indicative of a shift towards areas with higher demand and potential for growth.
Additionally, the company's positioning as a subcontractor for a $75 billion federal contract could be a game-changer, potentially providing a stable and significant revenue source. This move also aligns with the current trend of increasing government investment in healthcare infrastructure and services.
Investors should monitor the company's ability to leverage these operational highlights into sustainable growth. The success of these initiatives will depend on effective execution and the company's capacity to manage the increased scale of operations.
Conference call will be held today, Monday, March 25 at 9:00am ET
2023 Financial Highlights
- 2023 revenue of
$5.5 million $5.6 million - Business units excluding Healthcare Workforce grew
250% and comprised23% of total revenues in 2023, versus only6% in 2022. - Population Health, driven by demand for epidemiology services, had revenues of
$715,499 125% compared to 2022. - Digital Health, driven by sales of the Company's SyraBot product, had revenues of
$515,250 - Gross profit margin increased 670 bps to
25.6% compared to18.9% in 2022. - December 31, 2023 ending cash balance of
$3.3 million
2024 Financial Outlook
- The Company expects full-year 2024 revenue of
$9 $11 million 64% -100% versus 2023. - Guidance does not include any potential revenues from Caduceus Healthcare with regards to the recently announced Federal Influx Care Facilities contract.
Recent Operational Highlights
- Secured a five-year
$4.75 million District of Columbia's Department of Behavioral Health (DBH), to support DBH's mental health initiatives, including its Supported Employment Program and Comprehensive Psychiatric Emergency Program. - Secured a one-year contract with a national healthcare organization worth
$660,000 - Secured a one-year
$450,000 Tennessee , with two additional one-year renewal options, bringing the total potential value of the contract to$1.35 million - Announced that it has been selected as a subcontractor for a contract awarded to Caduceus Healthcare, Inc. by the federal Department of Health and Human Services (HHS), Administration for Families and Children (ACR), Office of Refugee Resettlement (ORR) Medical Staffing and Support, valued at
$75 billion - Launched Syrenity, a mental health product that proactively identifies the negative factors impacting mental health and integrates telehealth for mental health treatment.
- Launched CarePlus, an electronic medical record (EMR) system designed specifically for small to mid-sized healthcare organizations. CarePlus is an easy-to-use, secure, and scalable platform that allows for streamlining clinical workflows and integrating labs, radiology, and telehealth.
- In September 2023, successfully closed on its IPO and began trading on the NASDAQ.
Management Commentary
Dr. Deepika Vuppalanchi, CEO of Syra Health, said "We are continuing to make progress on our growth objectives. The demand for our services remains strong and we believe we are properly positioned to take advantage. Our financial guidance reflects the growth of our business. We are continuing to diversify our revenues in terms of geography and business units. Our burgeoning business units of Population Health, Behavioral and Mental Health, Digital Health, and Health Education are seeing solid growth. These higher margin business units are becoming a larger portion of our revenue base. We are currently operating in 17 states, and we anticipate securing new business from both the private sector and ongoing federal project bids."
Sandeep Allam, Executive Chairman and President of Syra Health, said, "We are excited about our growth prospects in 2024 and beyond. We are at the early stages of accelerating growth, which has been made possible by the investments we have made in recent years in technology and our people. Our Digital Health business unit is poised for growth, driven by our innovative SyraBot and our CarePlus solutions, which we launched in 2023. In 2023 we also launched Syrenity, our evidence-based and AI-backed product focused on the prevention of behavioral and mental health concerns. Anchoring these nascent businesses units is our legacy Healthcare Workforce business unit, which continues to generate solid revenues."
2023 Financial Results
Revenue in 2023, was
Gross profit margin in 2023 was
Total operating expenses in 2023 increased
Net Loss for 2023 was
Adjusted EBITDA for 2023 was
Cash on hand on December 31, 2023 was
Conference Call
Management will hold a conference call to discuss the fiscal year's financial results at 9:00am ET on March 25, 2024.
Interested parties can listen via a live webcast, from the link available in the Investor Relations section of the Company's website at https://ir.syrahealth.com/presentations/q4-and-full-year-2023-earnings-call
A replay will be available after the call, in the Investor Relations section of the Company's website at https://ir.syrahealth.com/presentations/q4-and-full-year-2023-earnings-call.
Non-GAAP Financial Measures
In addition to financial results reported in accordance with accounting principles generally accepted in
SYRA HEALTH CORP. | |||
Net Loss | |||
Interest | $ 53,686 | $ 28,533 | |
Depreciation | $ 48,771 | $ 14,849 | |
Taxes | $ 32,985 | $ 14,849 | |
EBITDA | $ (2,802,901) | $ (2,059,934) | |
Adjusted EBITDA | $ (2,802,901) | ||
ABOUT SYRA HEALTH
Syra Health is a healthcare technology company addressing some of healthcare's most significant challenges in areas such as behavioral and mental health, digital health, and population health, by providing innovative services and technology solutions. Syra Health's products and services are centered on prevention, improved access, and affordable care. Syra Health supplies its solutions to payers, providers, life sciences organizations, academic institutions, and government. For more information, please visit www.syrahealth.com.
Forward-Looking Statements
Statements in this press release about future expectations, plans, and prospects, as well as any other statements regarding matters that are not historical facts, may constitute 'forward-looking statements.' The words 'anticipate,' 'believe,' 'continue,' 'could,' 'estimate,' 'expect,' 'intend,' 'may,' 'plan,' 'potential,' 'predict,' 'project,' 'should,' 'target,' 'will,' 'would' and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the uncertainties related to market conditions. Any forward-looking statements contained in this press release speak only as of the date hereof, and Syra Health specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.
For more information, please contact:
Media:
Syra Health
Communications & Marketing Director
Christine Drury
317-385-9227
christined@syrahealth.com
Investors:
Ben Shamsian
Vice President
Lytham Partners, LLC
646-829-9701
shamsian@lythampartners.com
SYRA HEALTH CORP. BALANCE SHEETS | ||||||||
December 31, | December 31, | |||||||
2023 | 2022 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash | $ | 3,280,075 | $ | 3,344 | ||||
Accounts receivable, net | 1,060,634 | 1,201,097 | ||||||
Accounts receivable related party | 50,644 | |||||||
Other current assets | 389,787 | 222,302 | ||||||
Total current assets | 4,781,110 | 1,426,743 | ||||||
Deferred offering costs | - | 596,118 | ||||||
Property and equipment, net | 78,974 | 112,493 | ||||||
Right-of-use asset | 63,199 | 184,288 | ||||||
Total assets | $ | 4,923,283 | $ | 2,319,642 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 462,991 | $ | 432,388 | ||||
Accounts payable, related parties | - | 3,200 | ||||||
Accrued expenses | 198,978 | 239,117 | ||||||
Current portion of operating lease liability, related party | 63,199 | 121,089 | ||||||
Notes payable | 184,904 | - | ||||||
Revolving line of credit | - | 750,551 | ||||||
Total current liabilities | 910,072 | 1,546,345 | ||||||
Operating lease liability, related party | - | 63,199 | ||||||
Total liabilities | 910,072 | 1,609,544 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity (deficit): | ||||||||
Preferred stock, shares designated, issued and outstanding | - | - | ||||||
Class A common stock, authorized, 5,588,298 and 3,568,758 shares issued and outstanding at December 31, 2023 and 2022, respectively | 5,588 | 3,569 | ||||||
Convertible class B common stock, authorized, 833,334 shares issued and outstanding | 833 | 833 | ||||||
Additional paid-in capital | 9,071,745 | 2,832,308 | ||||||
Accumulated deficit | (5,064,955) | (2,126,612) | ||||||
Total stockholders' equity (deficit) | 4,013,211 | 710,098 | ||||||
Total liabilities and stockholders' equity (deficit) | $ | 4,923,283 | $ | 2,319,642 | ||||
SYRA HEALTH CORP. STATEMENTS OF OPERATIONS | ||||||||
For the Years Ended | ||||||||
December 31, | ||||||||
2023 | 2022 | |||||||
Net revenues | $ | 5,515,144 | $ | 5,617,706 | ||||
Cost of services | 4,103,244 | 4,555,924 | ||||||
Gross profit | 1,411,900 | 1,061,782 | ||||||
Operating expenses: | ||||||||
Salaries and benefits | 2,292,295 | 1,524,971 | ||||||
Professional services | 586,463 | 1,035,902 | ||||||
Research and development expenses | 240,048 | - | ||||||
Selling, general and administrative expenses | 1,131,922 | 575,755 | ||||||
Depreciation | 48,771 | 14,849 | ||||||
Total operating expenses | 4,299,499 | 3,151,477 | ||||||
Operating loss | (2,887,599) | (2,089,695) | ||||||
Other income (expense): | ||||||||
Interest income | 2,942 | 63 | ||||||
Interest expense | (53,686) | (28,533) | ||||||
Total other income (expense) | (50,744) | (28,470) | ||||||
Net loss | $ | (2,938,343) | $ | (2,118,165) | ||||
Weighted average common shares outstanding – basic and diluted | 4,877,861 | 3,041,085 | ||||||
Net loss per common share – basic and diluted | $ | (0.60) | $ | (0.70) | ||||
SYRA HEALTH CORP. STATEMENTS OF CASH FLOWS | ||||||||
For the Years Ended | ||||||||
December 31, | ||||||||
2023 | 2022 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net loss | $ | (2,938,343) | $ | (2,118,165) | ||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Non-cash lease expense | - | 95,563 | ||||||
Depreciation | 48,771 | 14,849 | ||||||
Amortization of debt discounts | - | 14,076 | ||||||
Common stock issued for services | - | 510,000 | ||||||
Stock-based compensation | 32,831 | 2,910 | ||||||
Decrease (increase) in assets: | ||||||||
Accounts receivable | (59,547) | (940,470) | ||||||
Accounts receivable, related party | (50,614) | - | ||||||
Other current assets | 203,110 | (200,798) | ||||||
Right-of-use asset | 121,089 | - | ||||||
Increase (decrease) in liabilities: | ||||||||
Accounts payable | 30,603 | 392,276 | ||||||
Accounts payable, related parties | (3,200) | (82,418) | ||||||
Accrued expenses | (22,679) | 163,675 | ||||||
Operating lease liability | (121,089) | (95,563) | ||||||
Net cash used in operating activities | (2,759,068) | (2,244,065) | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Purchase of property and equipment | (15,251) | (121,260) | ||||||
Net cash used in investing activities | (15,251) | (121,260) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Payments on deferred offering costs | - | (596,118) | ||||||
Repayment of notes payable | (185,692) | - | ||||||
Proceeds received on sale of Class A common stock | 5,332,283 | 2,322,500 | ||||||
Proceeds received from line of credit | 300,000 | 2,819,275 | ||||||
Repayments on line of credit | (1,050,551) | (2,082,800) | ||||||
Advances received from related party | 1,295,010 | 94,000 | ||||||
Repayments on advances from related party | (1,095,000) | (288,200) | ||||||
Proceeds received from convertible notes payable | 1,455,000 | - | ||||||
Net cash provided by financing activities | 6,051,050 | 2,268,657 | ||||||
NET CHANGE IN CASH | 3,276,731 | (96,668) | ||||||
CASH AT BEGINNING OF PERIOD | 3,344 | 100,012 | ||||||
CASH AT END OF PERIOD | $ | 3,280,075 | $ | 3,344 | ||||
SUPPLEMENTAL INFORMATION: | ||||||||
Interest paid | $ | 36,226 | $ | 11,651 | ||||
Income taxes paid | $ | - | $ | - | ||||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Initial recognition of right-of-use asset and lease liability | $ | - | $ | 131,187 | ||||
Class A common stock issued for debt and interest conversion | $ | 1,472,460 | $ | - | ||||
Cancellation of Class A common stock | $ | 42 | $ | - | ||||
Non-cash application of invoices to STLogics loan | $ | 200,010 | $ | - | ||||
Prepaid asset financed with notes payable | $ | 370,596 | $ | - | ||||
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SOURCE Syra Health
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