WELL Health Reports Record Results for Q3-2023, Raises Guidance for Balance of 2023 and Provides Guidance of Over $900 Million in Revenue for 2024
- Record quarterly revenues and Adjusted EBITDA showcase WELL's strong financial performance.
- Positive organic growth and expansion into Alberta contribute to Canadian business success.
- Strategic investments in AI and technology position WELL for future growth and innovation.
- Improved guidance for 2023 and expectations to exceed $900 million in annual revenue in 2024 demonstrate WELL's confidence in its future performance.
- None.
- WELL achieved record quarterly revenues of
$204.5 million $28.2 million - WELL surpassed a total of 1.03 million patient visits(2) in Q3-2023, and the Company achieved almost 1.58 million total care interactions(2) representing approximately 6.32 million care interactions on an annualized run-rate basis.
- WELL's Canadian business continues to experience significant organic growth and profitability generating Adjusted EBITDA of
$12.3 million 24% . - WELL is upgrading its guidance with the expectation that 2023 revenue will be between
$755 million $765 million - WELL expects to exceed
$900 million
Hamed Shahbazi, Founder and CEO of WELL commented, "Q3 was an outstanding quarter for us, as we achieved record patient visits, Adjusted EBITDA(1) and posted our first quarter ever with more than
Mr. Shahbazi further added, "Our commitment to ensuring that we support our healthcare providers with the most advanced technology has led us to significant investments in Artificial Intelligence. During the quarter, we led an investment that resulted in the re-launch of a new senior listed public company called, HEALWELL AI, a healthcare AI technology and data science company focused on preventative care where we are the largest securityholder. We subsequently entered into a strategic alliance agreement with HEALWELL that enabled us to launch WELL AI Decision Support to our network of clinics and doctors. This is only the beginning as we have a compelling pipeline of opportunities that leverage the power of AI to give healthcare providers clinical decision support tools that will give them their time back, enhance clinic productivity and provide better patient outcomes. We are determined to faithfully support healthcare professionals with the very best technology available which now includes significant investments in AI-based products and services."
Eva Fong, WELL's Chief Financial Officer, added, "In Q3 we achieved record revenue in both our Canadian and US patient services businesses. Furthermore, we've had a great year so far on our organic growth as we have delivered year-to-date vs year over year organic growth of
Third Quarter 2023 Financial Highlights:
- WELL achieved record quarterly revenue of
$204.5 million 40.2% as compared to revenue of$145.8 million - Canadian Patient Services revenue was
$57.8 million 27.0% as compared to$45.5 million Alberta . - WELL Health
USA Patient Services revenue was$130.7 million 52.3% as compared to$85.8 million USA 's virtual businesses, Circle Medical and Wisp. - SaaS and Technology Services revenue was
$15.9 million 10.3% as compared to$14.5 million - Adjusted Gross Profit(1) was
$94.2 million 20.5% as compared to Adjusted Gross Profit of$78.2 million - Adjusted Gross Margin(1) percentage was
46.1% in Q3-2023 compared to Adjusted Gross Margin percentage of53.6% in Q3-2022. - Adjusted EBITDA(1) was
$28.2 million 2.6% as compared to Adjusted EBITDA of$27.5 million - Adjusted EBITDA to WELL shareholders was
$22.9 million 13.2% as compared to Adjusted EBITDA to WELL shareholders of$20.2 million - Adjusted Net Income(1) was
$12.8 million $0.05 $14.8 million $0.07
Third Quarter 2023 Business Highlights:
On July 1, 2023, the Company through its subsidiary CRH, acquired a
On July 19, 2023, the Company advanced
On July 27, 2023, the Company announced that it has re-branded CRH Medical Corporation as WELL Health
On August 1, 2023, WELL completed the acquisition of Seekintoo, a provider of Cybersecurity Operations Center services to enterprise clients, equipping them with a managed detection responder service that assures 24/7 vigilant protection against threats.
On August 10, 2023, WELL announced that it had signed a
Events Subsequent to September 30, 2023:
On October 1, 2023, the Company completed its transaction with MCI that was previously announced on July 19, 2023 (the "HEALWELL Transaction"). MCI changed its name to HEALWELL AI Inc. (TSX: AIDX) ("HEALWELL") and re-launched as a healthcare technology company focused on AI and data science. As part of the HEALWELL Transaction, the Company acquired clinical assets in
On October 1, 2023, the Company acquired a
On October 18, 2023, the Company announced the launch of WELL AI Decision Support. WELL AI Decision Support is a solution that utilizes artificial intelligence to aid healthcare providers in early disease diagnosis and preventative health, particularly in identifying over 110 complex or rare diseases. Developed by HEALWELL AI, this technology has been validated in both Canadian and
On November 9, 2023, the Company announced the launch of the WELL Longevity+ Program, enhancing preventative health with advanced precision diagnostics and AI technologies for the early detection of serious health conditions. Expansion plans include rolling out WELL Longevity+ services through WELL Health's network of preventative health clinics throughout
Outlook:
WELL is expecting its strong performance to continue into the fourth quarter of 2023 and into 2024. WELL's objective is to invest in and achieve significant growth while effectively managing its costs and delivering strong growth and sustained cashflow to shareholders. Management is pleased to provide the following update to its revenue guidance, which only includes announced acquisitions:
- Annual revenue for 2023 is expected to be in the range of
$755 million $765 million - Annual revenue for 2024 is expected to be over
$900 million
WELL is focused on growing and acquiring as much market share as possible while delivering solid and sustained Adjusted EBITDA and cashflow growth each year. This is part of our management team's approach to providing shareholders with sustained profitable growth and industry leadership.
WELL is the largest owner and operator of healthcare Clinics 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 vast provider network.
WELL's strong organic growth and robust cash flow profile allows the Company to continue to successfully execute on its acquisition plans. Management expects additional cash flows generated by the Company will be re-invested in the business and allocated in a disciplined manner.
Conference Call:
WELL will hold a conference call to discuss its 2023 Third Quarter financial results on Tuesday, November 14, 2023, 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.
Selected Unaudited Financial Highlights:
Please see SEDAR for complete copies of the Company's condensed interim consolidated financial statements and interim MD&A for the quarter ended September 30, 2023.
Three months ended | Nine months ended | |||||
September 30, | June 30, | September 30, | September 30, | September 30, | ||
2023 | 2023 | 2022 | 2023 | 2022 | ||
$'000 | $'000 | $'000 | $'000 | $'000 | ||
Revenue | 204,461 | 170,922 | 145,789 | 544,808 | 412,623 | |
Cost of sales (excluding depreciation and amortization) | (110,225) | (80,099) | (67,597) | (273,580) | (189,569) | |
Adjusted Gross Profit(1) | 94,236 | 90,823 | 78,192 | 271,228 | 223,054 | |
Adjusted Gross Margin(1) | 46.1 % | 53.1 % | 53.6 % | 49.8 % | 54.1 % | |
Adjusted EBITDA(1) | 28,172 | 27,789 | 27,458 | 82,644 | 77,385 | |
Net (loss) income | (4,482) | (2,016) | 611 | (17,125) | (3,409) | |
Adjusted Net Income (1) | 12,760 | 14,361 | 14,753 | 41,246 | 41,211 | |
Loss per share, basic and diluted (in $) | (0.03) | (0.03) | (0.02) | (0.12) | (0.09) | |
Adjusted Net Income per share, basic and diluted (in $) (1) | 0.05 | 0.06 | 0.07 | 0.18 | 0.19 | |
Weighted average number of common shares outstanding, basic and | 238,104,415 | 235,434,417 | 226,783,493 | 235,258,386 | 217,721,268 | |
Reconciliation of net (loss) income to Adjusted EBITDA: | ||||||
Net (loss) income for the period | (4,482) | (2,016) | 611 | (17,125) | (3,409) | |
Depreciation and amortization | 15,449 | 14,041 | 13,918 | 44,012 | 41,103 | |
Income tax expense (recovery) | (25) | 1,889 | 2,979 | 2,056 | 2,534 | |
Interest income | (114) | (127) | (200) | (429) | (411) | |
Interest expense | 8,966 | 7,828 | 7,122 | 24,568 | 17,530 | |
Rent expense on finance leases | (2,672) | (2,581) | (2,339) | (7,743) | (6,718) | |
Stock-based compensation | 7,043 | 6,134 | 5,883 | 19,776 | 19,549 | |
Foreign exchange (gain) loss | (539) | (65) | 1,088 | (888) | 608 | |
Time-based earnout expense | 1,589 | 1,476 | 2,669 | 13,919 | 9,705 | |
Change in fair value of investments | - | - | - | - | (602) | |
Gain on disposal of investments | (7) | (1,517) | (5,240) | (1,524) | (5,240) | |
Share of net loss of associates | 102 | 91 | 195 | 290 | 433 | |
Transaction, restructuring,integration and other costs expensed | 2,862 | 838 | 772 | 3,934 | 2,303 | |
Other items | 0 | 1,798 | - | 1,798 | - | |
Adjusted EBITDA(1) | 28,172 | 27,789 | 27,458 | 82,644 | 77,385 | |
Attributable to WELL shareholders | 22,912 | 22,287 | 20,240 | 65,831 | 55,523 | |
Attributable to Non-controlling interests | 5,260 | 5,502 | 7,218 | 16,813 | 21,862 | |
Adjusted EBITDA(1) | ||||||
WELL Corporate | (5,074) | (4,478) | (4,623) | (14,198) | (12,663) | |
12,251 | 11,057 | 9,877 | 35,235 | 23,358 | ||
WELL Health Adjusted EBITDA(1) attributable to WELL shareholders | 20,995 | 21,210 | 22,204 | 61,607 | 66,690 | |
WELL Corporate | (5,074) | (4,478) | (4,623) | (14,198) | (12,663) | |
12,184 | 11,084 | 9,631 | 34,730 | 22,762 | ||
WELL Health Adjusted EBITDA(1) attributable to Non-controlling interests | 15,802 | 15,681 | 15,232 | 45,299 | 45,424 | |
67 | (27) | 246 | 505 | 596 | ||
WELL Health | 5,193 | 5,529 | 6,972 | 16,308 | 21,266 | |
Reconciliation of net (loss) income to Adjusted Net Income: | ||||||
Net (loss) income for the period | (4,482) | (2,016) | 611 | (17,125) | (3,409) | |
Amortization of intangible assets | 11,734 | 10,720 | 10,620 | 33,484 | 31,818 | |
Time-based earnout expense | 1,589 | 1,476 | 2,669 | 13,919 | 9,705 | |
Stock-based compensation | 7,043 | 6,134 | 5,883 | 19,776 | 19,549 | |
Change in fair value of investments | - | - | - | - | (602) | |
Other items | - | 1,798 | - | 1,798 | - | |
Non-controlling interest included in net loss | (3,124) | (3,751) | (5,030) | (10,606) | (15,850) | |
Adjusted Net Income (1) | 12,760 | 14,361 | 14,753 | 41,246 | 41,211 | |
Adjusted Net Income per share (1) | 0.05 | 0.06 | 0.07 | 0.18 | 0.19 | |
Footnotes: | |
(1) | This is a non-GAAP financial measure and ratio. |
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 Net Income, Adjusted Net Income Per Share, Adjusted EBITDA, Adjusted Gross Profit, Adjusted Gross Margin, 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 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. | |
EBITDA and Adjusted EBITDA | |
EBITDA and Adjusted EBITDA are non-GAAP measures. EBITDA represents net income (loss) before interest, taxes, depreciation and amortization. The Company defines Adjusted EBITDA as EBITDA (i) less 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, (iii) 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, and (iv) gains/losses that are not reflective of ongoing operating performance. The Company considers Adjusted EBITDA to be a financial metric that measures cash that the Company can use to fund working capital requirements, service future interest and principal debt repayments and fund future growth initiatives. EBITDA and Adjusted EBITDA should not be considered alternatives to net income (loss), cash flow from operating activities or other measures of financial performance in accordance with IFRS. | |
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 Free Cash Flow | |
The Company defines Adjusted Free Cash Flow Attributable to Shareholders as Adjusted EBITDA Attributable to Shareholders, less cash interest, less cash taxes and less capital expenditures. | |
Adjusted Net income, Adjusted Net Income per Share, Adjusted EBITDA, Adjusted Gross Profit, Adjusted Gross Margin 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. | |
(2) | Patient visits are defined by any interaction a patient has with a WELL practitioner through all sources and channels. This includes also diagnostic testing consultations or any asynchronous physician consultations. Care Interactions are defined as Patient Visits plus Technology Interactions and Billed Provider Hours. |
(3) | Leverage ratio is defined as Net Bank Debt divided by trailing twelve months (TTM) Shareholder Adjusted EBITDA, where Net Bank Debt is calculated as Total Debt less cash and excluding convertible debt. |
(4) | Organic growth includes the impact of USD/CAD exchange rates. |
WELL HEALTH TECHNOLOGIES CORP.
Per: "Hamed Shahbazi"
Hamed Shahbazi
Chief Executive Officer, Chairman and Director
About WELL Health Technologies Corp.
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 33,000 healthcare providers between the US and
Forward-Looking Statements
This news release may contain "Forward-Looking Information" within the meaning of applicable Canadian securities laws, including, without limitation: its care interaction run-rate and annual guidance; information regarding the Company's goals, strategies and growth plans; expectations regarding continued revenue and EBITDA growth; the expected benefits and synergies of completed acquisitions; capital allocation plans in the form of more acquisitions or share repurchases; 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 the COVID-19 pandemic; 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 documents filed by WELL under its profile at www.sedarplus.ca, including its most recent Annual Information Form. 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.
View original content to download multimedia:https://www.prnewswire.com/news-releases/well-health-reports-record-results-for-q3-2023-raises-guidance-for-balance-of-2023-and-provides-guidance-of-over-900-million-in-revenue-for-2024-301987260.html
SOURCE WELL Health Technologies Corp.
FAQ
What were WELL's quarterly revenues and Adjusted EBITDA in Q3-2023?
How many patient visits did WELL surpass in Q3-2023?
What is WELL's expected revenue for 2024?
What strategic investments did WELL make in Q3-2023?
What is the YoY increase in Canadian business Adjusted EBITDA in Q3-2023?
