WELL Health Reports Record Quarterly Revenue and Record Net Income for a first quarter in Q1-2024 and Increases Both Revenue and Adjusted EBITDA Guidance for 2024
WELL Health Technologies Corp. (WELL) reported record quarterly revenue of $231.6 million in Q1-2024, a 37% increase YoY, driven by acquisitions and organic growth of 13%. Adjusted EBITDA reached $28.3 million, a 6% increase from Q1-2023. Net Income was $19.6 million compared to a loss in Q1-2023. The company increased its guidance for 2024 revenue to $960-980 million and Adjusted EBITDA to $125-130 million. WELL also expects to improve FCFA2S by 30% in 2024.
Record quarterly revenue of $231.6 million in Q1-2024, a 37% increase YoY driven by acquisitions and organic growth of 13%.
Adjusted EBITDA of $28.3 million in Q1-2024, a 6% increase from Q1-2023.
Net Income of $19.6 million in Q1-2024 compared to a loss in Q1-2023.
Guidance increased for 2024 revenue to $960-980 million and Adjusted EBITDA to $125-130 million.
Expected improvement of FCFA2S by over $55 million in 2024, a 30% increase from 2023.
Decrease in SaaS and Technology Services revenue by 20% due to the sale of Intrahealth.
Adjusted Gross Margin percentage declined YoY mainly due to acquisitions with lower gross margin percentages in 2023.
- WELL achieved record quarterly revenues of
$231.6 million 37% as compared to Q1-2023 driven by acquisitions and organic growth of13% which includes growth related to our clinic absorption program. - WELL achieved Adjusted EBITDA(1) of
$28.3 million 6% as compared to Q1-2023. WELL's Canadian business grew its Adjusted EBITDA in Q1- 2024 by19% to$14.6 million - WELL achieved Net Income of
$19.6 million $0.06 $10.6 million $20.2 million $0.08 43% higher than Q1-2023. - WELL achieved free cashflow available to shareholders or "FCFA2S" per share of
$0.05 1111% increase over Q1-2023. WELL is pleased to provide guidance of an improvement of FCFA2S of more than$55M 30% increase from$42.4 million - WELL increases its guidance range for 2024 annual revenue of between
$960 million $980 million $125 million $130 million
Hamed Shahbazi, Founder and CEO of WELL, commented, "The first quarter of 2024 exceeded all expectations, showcasing the robustness and efficacy of our technology-driven care delivery platforms. We're pleased to report that we have begun the year with an intense focus on enhanced profitability and capital efficiency and are proud to report a
Mr. Shahbazi further added, "Central to our identity is our commitment to providing compassionate care and unwavering support to healthcare providers. As of the end of Q1-2024, over 3,900 providers and clinicians delivered care across WELL's network of physical and virtual clinics, and more than an additional 36,000 providers benefited from our SaaS and Technology Services. Our dedication remains steadfast in empowering healthcare professionals with cutting-edge technology, including substantial investments in Artificial Intelligence (AI)-based products and services, aimed at enhancing provider productivity and effectiveness. "
Eva Fong, WELL's Chief Financial Officer, added, "I am proud to announce that we achieved positive EPS, or Earnings Per Share, in the first quarter of 2024. In support of our operating plan for 2024, we implemented a comprehensive cost-cutting program which has resulted in strengthening our operational efficiency and produced significant annualized cost savings. We generated
- WELL achieved record quarterly revenue of
$231.6 million 37% as compared to revenue of$169.4 million 13% - Canadian Patient Services revenue was
$75.7 million 49% as compared to$50.9 million - WELL Health
USA Patient and Provider Services revenue was$140.4 million 42% as compared to$99.2 million - SaaS and Technology Services revenue was
$15.4 million 20% as compared to$19.4 million - Adjusted Gross Profit(1) was
$102.2 million 19% as compared to Adjusted Gross Profit(1) of$86.2 million - Adjusted Gross Margin(1) percentage was
44.1% during Q1-2024 compared to Adjusted Gross Margin(1) percentage of50.9% in Q1-2023 and an improvement as compared to43.7% in the previous quarter. The YoY decline in Adjusted Gross Margin percentage is mainly attributed to the acquisition of businesses with lower gross margin percentage in 2023. - Adjusted EBITDA(1) was
$28.3 million 6% as compared to Adjusted EBITDA(1) of$26.7 million - Adjusted EBITDA to WELL shareholders was
$21.4 million 4% as compared to Adjusted EBITDA to WELL shareholders of$20.6 million - Adjusted EBITDA attributable to the Canadian business was
$14.6 million 19% YoY - Adjusted Net Income(1) was
$20.2 million $0.08 $14.1 million $0.06
WELL achieved a record 1.3 million patient visits in Q1-2024, an increase of
Total care interactions were 2.0 million in Q1-2024, a year-over-year increase of
Q1-24 | Q4-23 | Q1-23 | QoQ | YoY | YoY Organic | |
Canada Patient | 733,000 | 678,000 | 504,000 | 8 % | 45 % | 19 % |
US Patient Visits | 577,000 | 544,000 | 471,000 | 6 % | 23 % | 20 % |
Total Visits | 1,310,000 | 1,222,000 | 975,000 | 7 % | 34 % | 19 % |
Technology | 599,000 | 547,000 | 422,000 | 10 % | 42 % | 42 % |
Billed Provider Hours | 89,000 | 98,000 | 0 | -9 % | n/a | n/a |
Total Care | 1,998,000 | 1,867,000 | 1,397,000 | 7 % | 43 % | 26 % |
As of the end of Q1-2024, WELL had 175 clinics operating out of 97 physical facilities across
On January 26, 2024, the Company refinanced its syndicated credit facility with JPMorgan Chase Bank, N.A. to include two new syndicate members and extend the term to January 26, 2027. The
On February 1, 2024, the Company completed the sale of Intrahealth, an EMR provider within the Company's SaaS and Technology Services reportable segment, to HEALWELL for a total consideration of approximately
On February 7, 2024, the Company announced the establishment of a public sector group aimed at assisting large-scale health systems and enterprises with technology enablement. This initiative seeks to offer tailored product offerings to meet the unique needs of the public sector, leveraging WELL's leading technology platform and extensive outpatient clinic network in
On February 22, 2024, the Company restructured into three groups to enhance operational efficiency. The WELL Clinics Corp Operating entity, managed by Dr. Michael Frankel, covers all Canadian clinical operations including primary care and specialized care. The Platform Solutions Group, led by Amir Javidan, consolidates Canadian platform technologies such as Provider Solutions, Cybersecurity, Public Sector, and Enterprise Solutions. WELL Health
On February 27, 2024, the Company announced the appointment of its CEO, Hamed Shahbazi, as Chairman of the Board of HEALWELL AI Inc. This move signifies WELL's strategic commitment to leveraging AI for healthcare. WELL, aims to strengthen its position in AI-powered preventative care. Shahbazi's leadership underscores the shared goal of both companies to develop advanced AI tools benefiting healthcare providers and patients.
On March 7, 2024, the Company announced that its subsidiary, OceanMD, had expanded to include over 4,700 clinics and hospitals across
On April 16, 2024, the Company announced its acquisition of 10 primary care medical clinics operated by Shoppers Drug Mart Inc. under the name The Health Clinic by Shoppers™. These clinics, located in
On April 30, 2024, the Company announced a five-year collaboration agreement with Microsoft to improve North American healthcare by integrating Microsoft Azure and its AI with WELL's digital health platform to improve clinical outcomes, optimize costs, and ensure top-tier data privacy and security.
On May 2, 2024, the Company announced the launch of the second-generation WELL AI Decision Support ("WAIDS"), powered by HEALWELL AI, which now features advanced chronic disease screening for diseases like chronic kidney disease, hypertension, and diabetes, enabling patient risk stratification.
WELL is expecting its strong performance to continue for the remainder of 2024 with a greater focus on optimizing its operations for organic growth, profitability and minimizing share dilution. WELL's objective is to focus on more capital efficient growth opportunities while effectively managing its costs and delivering strong growth and sustained cashflow to shareholders. Management is pleased to provide the following update to its guidance, which only includes announced acquisitions:
- Annual revenue for 2024 is expected to be in the range of
$960 million $980 million - Annual Adjusted EBITDA(1) for 2024 is expected to be in the upper end of the guidance range of
$125 million $130 million - Improving Free cashflow available to shareholders to over
$55 million $42.4 million
WELL expects to continue to grow its U.S. and Canadian Patient Services business both organically and inorganically but with greater emphasis on capital efficiency such that it can use cashflows from its business to reduce debt and share issuance levels. In
As a company with deep tech experience and capabilities, WELL has also made investments in AI technologies a key priority within the Company and expects to develop compelling new products and enhancements to roll out to WELL's provider and clinic network.
WELL has implemented a cost optimization program to enhance operational efficiency and profitability. This program includes staff restructuring, enhanced integration with acquired entities and several other cost optimization initiatives. WELL's strong organic growth and robust cash flow profile allows the Company to continue to successfully execute on its growth plans while reducing its debt levels over time.
WELL will hold a conference call to discuss its 2024 First Quarter financial results on Wednesday, May 8, 2024, at 1:00 pm ET (10:00 am PT). Please use the following dial-in numbers: 416-764-8650 (
The conference call will also be simultaneously webcast and can be accessed at the following audience URL: https://well.company/events.
Please see SEDAR+ for complete copies of the Company's condensed interim consolidated financial statements and interim MD&A for the quarter ended March 31, 2024.
Quarter Ended | ||||
March 31, | December 31, | March 31, | ||
2024 $'000 | 2023 $'000 | 2023 $'000 | ||
Revenue | 231,562 | 231,246 | 169,425 | |
Cost of sales (excluding depreciation and amortization) | (129,342) | (130,207) | (83,256) | |
Adjusted Gross Profit(1) | 102,220 | 101,039 | 86,169 | |
Adjusted Gross Margin(1) | 44.1 % | 43.7 % | 50.9 % | |
Adjusted EBITDA(1) | 28,314 | 30,750 | 26,683 | |
Net income (loss) | 19,600 | 33,762 | (10,627) | |
Adjusted Net Income (1) | 20,239 | 11,156 | 14,125 | |
Earnings (loss) per share, basic and diluted (in $) | 0.06 | 0.12 | (0.06) | |
Adjusted Net Income per share, basic and diluted (in $) (1) | 0.08 | 0.05 | 0.06 | |
Weighted average number of common shares outstanding, basic and diluted | 243,133,444 | 240,354,683 | 232,171,126 | |
Reconciliation of net income (loss) to Adjusted EBITDA: | ||||
Net income (loss) for the period | 19,600 | 33,762 | (10,627) | |
Depreciation and amortization | 16,560 | 16,756 | 14,522 | |
Income tax expense (recovery) | (178) | 804 | 192 | |
Interest income | (238) | (334) | (188) | |
Interest expense | 9,541 | 9,035 | 7,774 | |
Rent expense on finance leases | (4,114) | (3,540) | (2,490) | |
Stock-based compensation | 5,477 | 6,386 | 6,599 | |
Foreign exchange (gain) loss | (32) | 252 | (284) | |
Time-based earnout expense | 2,112 | 7,493 | 10,854 | |
Change in fair value of investments | (13,957) | (42,560) | - | |
Gain on disposal of assets and investments | (11,284) | (46) | - | |
Share of net loss of associates | 1,064 | 88 | 97 | |
Transaction, restructuring and integration costs expensed | 3,763 | 2,654 | 234 | |
Adjusted EBITDA(1) | 28,314 | 30,750 | 26,683 | |
Attributable to WELL shareholders | 21,371 | 22,583 | 20,632 | |
Attributable to Non-controlling interests | 6,943 | 8,167 | 6,051 | |
AdjustedEBITDA(1) | ||||
WELL Corporate | (4,767) | (4,596) | (4,525) | |
Canada and others | 14,474 | 9,985 | 11,805 | |
US operations | 18,607 | 25,361 | 19,403 | |
Adjusted EBITDA(1) attributable to WELL shareholders | ||||
WELL Corporate | (4,767) | (4,596) | (4,525) | |
Canada and others | 14,247 | 9,839 | 11,511 | |
US operations | 11,891 | 17,340 | 13,646 | |
AdjustedEBITDA(1) attributable to Non-controlling interests | ||||
Canada and others | 227 | 146 | 294 | |
US operations | 6,716 | 8,021 | 5,757 | |
Reconciliation of net income(loss) to Adjusted Net Income: | ||||
Net income (loss) for the period | 19,600 | 33,762 | (10,627) | |
Amortization of acquired intangible assets | 11,520 | 12,024 | 11,030 | |
Time-based earnout expense | 2,112 | 7,493 | 10,854 | |
Stock-based compensation | 5,477 | 6,386 | 6,599 | |
Change in fair value of investments | (13,957) | (42,560) | - | |
Non-controlling interest included in net income (loss) | (4,513) | (5,949) | (3,731) | |
Adjusted Net Income(1) | 20,239 | 11,156 | 14,125 | |
Adjusted Net Income pershare(1) | 0.08 | 0.05 | 0.06 | |
- Non-GAAP financial measures and ratios.
In addition to results reported in accordance with IFRS, the Company uses certain non-GAAP financial measures as supplemental indicators of its financial and operating performance. These non-GAAP financial measures include Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, Adjusted EBITDA attributable to WELL Shareholders/Non-controlling interests, Adjusted Net Income, Adjusted Net Income Per Share, and Adjusted Free Cash Flow. The Company believes these supplementary financial measures reflect the Company's ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in its business.
Adjusted Gross Profit and Adjusted Gross Margin
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 income (loss) determined in accordance with IFRS. The Company does not present gross profit in its consolidated financial statements as it is a non-GAAP financial measure. The Company believes that adjusted gross profit and adjusted gross margin are meaningful metrics that are often used by readers to measure the Company's efficiency of selling its products and services.
Adjusted EBITDA
The Company defines Adjusted EBITDA as net income (loss) before interest, taxes, depreciation and amortization less (i) net rent expense on premise leases considered to be finance leases under IFRS and before (ii) transaction, restructuring, and integration costs, time-based earn-out expense, change in fair value of investments, share of income (loss) of associates, foreign exchange gain/loss, and stock-based compensation expense, and (iii) gains/losses that are not reflective of ongoing operating performance. The Company considers Adjusted EBITDA to be a financial metric that measures cash flow that the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives. Adjusted EBITDA should not be considered alternatives to net income (loss), cash flow from operating activities or other measures of financial performance defined under IFRS.
Adjusted EBITDA attributable to WELL Shareholders/Non-controlling interests
The Company defines Adjusted EBITDA attributable to WELL Shareholders (or Shareholder EBITDA) and Adjusted EBITDA attributable to Non-controlling interests as the sum of the Adjusted EBITDA for each relevant legal entity multiplied by WELL's or the non-controlling interests' equity ownership, respectively.
Adjusted Net Income and Adjusted Net Income per Share
The Company defines Adjusted Net Income as net income (loss), after excluding the effects of stock-based compensation expense, amortization of acquired intangible assets, time-based earnout expense, change in fair value of investments, non-controlling interests, and revenue precluded from recognition under IFRS 15 that relates to certain patient services revenue that the Company believes should be recognized as revenue based on its contractual relationships. Adjusted Net Income Per Share is Adjusted Net Income divided by weighted average number of shares outstanding. The Company believes that these non-GAAP financial measures provide useful information to analyze our results, enhance a reader's understanding of past financial performance and allow for greater understanding with respect to key metrics used by management in decision making. More specifically, the Company believes Adjusted Net Income is a financial metric that tracks the earning power of the business that is available to WELL shareholders.
Adjusted Free Cashflow
The Company defines Adjusted Free Cashflow as Adjusted EBITDA Attributable to Shareholders, less cash interest, less cash taxes and less capital expenditures.
Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, Adjusted EBITDA attributable to WELL Shareholders/Non-controlling interests, Adjusted Net Income, Adjusted Net Income Per Share, and Adjusted Free Cash Flow are not recognized measures for financial statement presentation under IFRS and do not have standardized meanings. As such, these measures may not be comparable to similar measures presented by other companies and should be considered as supplements to, and not as substitutes for, or superior to, the corresponding measures calculated in accordance with IFRS. - Total Care Interactions are defined as Total Visits plus Technology Interactions plus Billed Provider Hours.
WELL HEALTH TECHNOLOGIES CORP.
Per: "Hamed Shahbazi"
Hamed Shahbazi
Chief Executive Officer, Chairman and Director
WELL's mission is to tech-enable healthcare providers. We do this by developing the best technologies, services, and support available, which ensures healthcare providers are empowered to positively impact patient outcomes. WELL's comprehensive healthcare and digital platform includes extensive front and back-office management software applications that help physicians run and secure their practices. WELL's solutions enable more than 36,000 healthcare providers between the US and
This news release may contain "Forward-Looking Information" within the meaning of applicable Canadian securities laws, including, without limitation: information regarding the Company's improvement to its free cash flow and Adjusted EBITDA guidance; its acquisition, strategies and growth plans; annual patient visit run-rates; the launch of new products; the expected benefits and synergies of completed acquisitions, debt repayment, share purchases, and cost optimization plans; and the expected financial performance as well as information in the "Outlook" section herein. Forward-Looking Information 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. Forward-Looking Information 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 Information 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 the Forward-Looking Information and the Forward-Looking Information are not guarantees of future performance. WELL's comments expressed or implied by such Forward-Looking Information 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 information. Forward-Looking Information are qualified in their entirety by inherent risks and uncertainties, including: direct and indirect material adverse effects from 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 any requisite future financing on suitable terms; any inability to realize the expected benefits and synergies of acquisitions; that market competition may affect the business, results and financial condition of WELL and other risk factors identified in its most recent Annual Information Form filed by WELL under its profile at www.sedarplus.ca. Except as required by securities law, WELL does not assume any obligation to update or revise any forward-looking information, whether as a result of new information, events or otherwise.
This news release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about estimated annual run-rate revenue and Adjusted EBIDTA, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set out in the above paragraph. The actual financial results of WELL may vary from the amounts set out herein and such variation may be material. WELL and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments. However, because this information is subjective and subject to numerous risks, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, WELL undertakes no obligation to update such FOFI. FOFI contained in this news release was made as of the date hereof and was provided for the purpose of providing further information about WELL's anticipated future business operations on an annual basis. Readers are cautioned that the FOFI contained in this news release should not be used for purposes other than for which it is disclosed herein.
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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