RESTON, Va., Aug. 12, 2021 /PRNewswire/ -- SOC Telemed, Inc.,
(NASDAQ: TLMD), the largest national provider of acute care
telemedicine, today announced its financial and operating results
for the second quarter ending June 30,
2021.
"Our second quarter results reflect strong growth driven
by a return to pre-COVID consult volumes in our telePsychiatry
service line and a near return in our teleNeurology service line,"
said John Kalix, Chief Executive
Officer of SOC Telemed. "Our late stage pipeline grew 30% since the
first quarter. Such growth illustrates the expansive cross sell
opportunity facing SOC Telemed, as we drive both site expansion and
service line expansion across the client base."
He further stated, "The ability to provide a comprehensive
offering of clinical services combined with the Telemed IQ platform
positions SOC Telemed to help solve our client's friction points
around access to specialty physicians, network integrity, and
optimization of clinician resources. As the largest acute
telemedicine provider, we are well positioned to be the provider of
choice as hospitals consolidate to a single vendor."
Second Quarter and Recent Highlights
- Announced a multi-site telePsychiatry service line expansion
with UnityPoint Health for the Des
Moines, Iowa, and Cedar Rapids,
Iowa, markets, expected to go live in 2H21. UnityPoint
Health's multi-site expansion was driven by the success case
developed at UnityPoint Health Allen Hospital, which reduced
average length of stay (ALOS) by approximately 12 hours, reduced
its readmission rate by 4%, and avoided more than $1.7 million in annualized boarding costs,
leading to an annual ROI of 281%
- In May, we announced an expanded partnership with SCP Health
(SCP). Under the multi-year agreement, SOC Telemed will provide the
Telemed IQ platform to help accelerate and expand SCP's telehealth
capabilities across the country
- In April, Bon Secours Mercy – Lourdes Hospital implemented the
teleICU service line, and Davis Regional Medical Center implemented
the teleNeurology and teleStroke service lines
Operating Metrics Summary
Operational performance metrics for the three months ended
June 30, 2021, compared to the three
months ended June 30, 2020. We
present consults on a pro forma basis (i.e., giving retroactive
effect to the Access Physicians acquisition to January 1, 2020) to provide investors with
insight into how management views the performance of the combined
business period over period.
- Total system-wide consults were 130,214 compared to 65,690, up
98% year over year, and up 49% year over year on a pro forma
basis
- Stand-alone SOC core consults totaled 37,817 compared to
30,213, up 25% on a year over year basis. TelePsychiatry volumes
recovered to pre-COVID levels faster than expected, and the
teleNeurology service line experienced significant volume
increases
- Access Physicians contributed 31,700 core consults, up 47% on a
year over year basis
- System-wide revenue per core consult totaled $339 compared to $349, down 3%, primarily driven by the addition
of Access Physicians, as revenue per core consult at Access
Physicians is historically lower than revenue per core consult at
legacy SOC. The average revenue per core consult is also impacted
by duration of each consult, which varies widely between service
lines
- Stand-alone SOC revenue per core consult was $417 versus $429,
as the volume recovery in telePsychiatry and teleNeurology narrowed
the gap associated with minimum consult thresholds in client
contracts
- Access Physicians revenue per core consult was $245 versus $237,
up 3% year over year, driven by service line volume mix
- Implementations totaled 74 compared to 80, with Access
Physicians contributing 11 implementations
- Stand-alone SOC services per facility totaled 2.1 compared to
1.9, demonstrating the continued opportunity to expand across both
service lines and sites with existing customers
- Total facilities serviced were 1,028 compared to 847 a year
ago, up 21% on a year over year basis. The 1,028 facilities
serviced includes 179 facilities serviced by Access Physicians
Financial Results Summary
Financial performance for the three months ended June 30, 2021, compared to the three months ended
June 30, 2020.
- Bookings totaled $6.7 million, up
136%
- Revenue totaled $25.0 million
compared to $13.6 million, up
84%
- Access Physicians contributed $8.4
million of revenue
- GAAP gross profit totaled $8.0
million compared to $4.5
million
- Adjusted gross profit (non-GAAP) totaled $9.3 million compared to $5.5 million
- GAAP gross margin was 32% compared to 33%
- Adjusted gross margin (non-GAAP) was 37% compared to 40%.
Results were negatively impacted primarily by an increase in
physician incentive payments related to the rapid increase and
volatility of consult demand
- Net loss totaled $(14.5) million
compared to a net loss of $(8.2)
million
- Adjusted EBITDA loss totaled $(5.4)
million compared to $(1.6)
million
Balance Sheet
As of June 30, 2021, the Company
had cash and cash equivalents of $50.0
million.
In June 2021, SOC Telemed
completed an underwritten follow-on public offering of 9.2 million
shares generating net proceeds of approximately $52.0 million, after deducting underwriting
discounts and offering expenses.
2021 Financial Outlook
For the full year 2021, SOC Telemed is providing the following
revised financial guidance:
- GAAP Revenue is expected to be in the range of $90 million to $92
million, with approximately 30% expected to be attributed to
Access Physicians
- Primary drivers of the guidance revision include impacts from
the Delta variant of COVID-19, specifically on increased pressure
on hospital emergency departments, and a change in go-to-market
strategy around hardware sales related to the integration of Access
Physicians
- The previous GAAP revenue guidance range was $97 million to $103
million, with approximately 30% to 35% expected to be
attributed to Access Physicians
- Adjusted gross margin is expected to be in the range of 37.0%
and 40.0%
- Adjusted EBITDA is expected to be in the range of $(22.0) million to $(25.0)
million
These statements are forward-looking and actual results may
differ materially. Please refer to the Forward-Looking Statements
safe harbor below for information on the factors that could cause
our actual results to differ materially from these forward-looking
statements.
SOC Telemed has not reconciled its expectations as to Adjusted
Gross Margin and Adjusted EBITDA to the most comparable GAAP
measures because certain items are out of its control or cannot be
reasonably calculated or predicted at this time without
unreasonable efforts. Accordingly, a reconciliation for
forward-looking Adjusted Gross Margin and Adjusted EBITDA is not
available without unreasonable effort.
Upcoming Conferences and Investor Events
Wells Fargo Virtual Healthcare Conference, September 9 – 10, 2021
Baird 2021 Global Healthcare Conference, September 14 - 15, 2021
Conference Call Details
The second quarter 2021 earnings conference call and webcast
will be held on August 12, 2021, at
5:00 p.m. ET. The conference call can
be accessed by dialing, either:
Domestic: (877) 870-4263
International: (412) 317-0790
Passcode: reference "SOC Telemed call"
A live audio webcast will be available on the Investor Relations
section of the Company website at investors.soctelemed.com. A
webcast replay will be available for on-demand listening shortly
after the completion of the call at the same web link.
About SOC Telemed
SOC Telemed (NASDAQ: TLMD, "SOC") is the leading national
provider of acute telemedicine technology and solutions to
hospitals, health systems, post-acute providers, physician
networks, and value-based care organizations since 2004. Built on
proven and scalable infrastructure as an enterprise-wide solution,
SOC's technology platform, Telemed IQ, rapidly deploys and
seamlessly optimizes telemedicine programs across the continuum of
care. SOC provides a supportive and dedicated partner presence,
virtually delivering patient care through teleNeurology,
telePsychiatry, teleCritical Care, telePulmonology,
teleCardiology, teleInfectious Disease,
teleNephrology, teleMaternal-Fetal Medicine and other service
lines, enabling healthcare organizations to build sustainable
telemedicine programs across clinical specialties. SOC enables
organizations to enrich their care models and touch more lives by
supplying healthcare teams with industry-leading solutions that
drive improved clinical care, patient outcomes, and organizational
health. The company was the first provider of acute clinical
telemedicine services to earn The Joint Commission's Gold Seal of
Approval and has maintained that accreditation every year since
inception. For more information, visit www.soctelemed.com.
Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the "safe harbor" provisions of the United States
Private Securities Litigation Reform Act of 1995. In some cases,
you can identify these forward-looking statements by the use of
terms such as "expect," "will," "continue," or similar expressions,
and variations or negatives of these words, but the absence of
these words does not mean that a statement is not forward-looking.
All statements other than statements of historical fact are
statements that could be deemed forward-looking statements,
including, but not limited to: the statements under "2021 Outlook,"
including expectations relating to bookings and revenue; statements
regarding relationships with customers and business momentum;
statements regarding the expected benefits of the acquisition of
Access Physicians (including anticipated synergies, projected
financial information and future opportunities); and any other
statements of expectation or belief. These statements are subject
to known and unknown risks, uncertainties and other factors that
may cause our actual results, levels of activity, performance or
achievements to differ materially from results expressed or implied
in this press release. Such risk factors include, but are not
limited to, those related to: the current and future impact of the
COVID-19 pandemic on SOC Telemed's business and industry; continued
difficulties in the integration of Access Physicians; the effects
of competition on the future business of SOC Telemed; uncertainty
regarding the demand for and market utilization of its solution;
returns on investments in its business; the ability to maintain
customer relationships; difficulties maintaining and expanding its
network of qualified physicians and other provider specialists;
disruptions in SOC Telemed's relationships with affiliated
professional entities or third party suppliers or service
providers; general business and economic conditions; the ability of
SOC Telemed to successfully execute strategic plans; the timing and
market acceptance of new solutions or success of new enhancements,
features modifications to existing solutions and the degree to
which they gain acceptance. Additional information concerning these
and other risk factors is contained in the Risk Factors section of
SOC Telemed's most recent annual report on Form 10-K. Additional
information will be made available in SOC Telemed's quarterly
report on Form 10-Q for the three months ended June 30,
2021, and other filings and reports that SOC Telemed may file from
time to time with the SEC. SOC Telemed assumes no obligation, and
does not intend, to update these forward-looking statements as a
result of future events or developments.
Use of Non-GAAP Financial Information
We believe that, in addition to our financial results determined
in accordance with GAAP, adjusted gross profit (non-GAAP), adjusted
gross margin (non-GAAP), and adjusted EBITDA, all of which are
non-GAAP financial measures, are useful in evaluating our business,
results of operations, and financial condition. However, our
use of the terms adjusted gross profit, adjusted gross margin and
adjusted EBITDA may vary from that of others in our industry.
Adjusted gross profit, adjusted gross margin and adjusted EBITDA
should not be considered as an alternative to gross profit, net
loss, net loss per share or any other performance measures derived
in accordance with GAAP as measures of performance. Adjusted gross
profit, adjusted gross margin and adjusted EBITDA have important
limitations as analytical tools and you should not consider them in
isolation or as a substitute for analysis of our results as
reported under GAAP. Some of these limitations are:
- adjusted EBITDA does not reflect the significant interest
expense on our debt;
- although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future, and adjusted gross profit, adjusted gross
margin and adjusted EBITDA do not reflect any expenditures for such
replacements; and
- other companies in our industry may calculate these financial
measures differently than we do, limiting their usefulness as
comparative measures.
We compensate for these limitations by using these non-GAAP
financial measures along with other comparative tools, together
with GAAP measurements, to assist in the evaluation of operating
performance. Such GAAP measurements include gross profit, net loss,
net loss per share and other performance measures. In evaluating
these financial measures, you should be aware that in the future we
may incur expenses similar to those eliminated in this
presentation. Our presentation of non-GAAP financial measures
should not be construed as an inference that our future results
will be unaffected by unusual or nonrecurring items. When
evaluating our performance, you should consider these non-GAAP
financial measures alongside other financial performance measures,
including the most directly comparable GAAP measures set forth in
the reconciliation tables below and our other GAAP results.
Our non-GAAP financial measures are described as follows:
Adjusted gross profit and adjusted gross
margin. Adjusted gross profit is defined as revenues less
cost of revenues plus depreciation and amortization plus equipment
leasing costs plus stock-based compensation. Adjusted gross margin
is adjusted gross profit divided by revenues.
Adjusted EBITDA. Adjusted EBITDA is defined as net income
(loss) before interest, taxes, depreciation and amortization,
stock-based compensation, gain on contingent shares issuance
liabilities, loss on puttable option liabilities, gain on change in
fair value of contingent consideration, and integration,
acquisition, transaction and executive severance costs.
Readers are encouraged to review the reconciliation of our
non-GAAP financial measures to the comparable GAAP results, which
is attached to this earnings release and which can be found on SOC
Telemed's investor relations page of its website
at: investors.soctelemed.com.
Operating Metrics
Because our consultation fee revenue generally increases as the
number of visits increase, we believe the number of consultations
provides investors with useful information on period-to-period
performance as evaluated by management and as a comparison to our
past financial performance. We define core consultations as
consultations utilizing our 11 core services. Telemed IQ / other
consultations are defined as consultations performed by other
physician networks utilizing our technology platform, Telemed IQ.
Pro forma consultations represent the number of total consultations
as if Access Physicians had been acquired as of January 1, 2020.
Number of
Consults
|
|
|
|
Q1
2020
|
|
Q2
2020
|
|
Q3
2020
|
|
Q4
2020
|
|
Q1
2021
|
|
Q2
2021
|
|
|
Core
|
|
|
36,347
|
|
|
|
30,213
|
|
|
|
32,126
|
|
|
|
30,920
|
|
|
|
31,447
|
|
|
|
37,817
|
|
|
|
Access
Physicians
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,282
|
|
|
|
31,700
|
|
|
|
Telemed IQ /
Other
|
|
|
30,649
|
|
|
|
35,477
|
|
|
|
47,800
|
|
|
|
57,292
|
|
|
|
62,636
|
|
|
|
60,697
|
|
|
|
Total
Consults
|
|
|
66,996
|
|
|
|
65,690
|
|
|
|
79,926
|
|
|
|
88,212
|
|
|
|
95,365
|
|
|
|
130,214
|
|
|
|
|
Number of Pro
Forma Consults
|
|
|
|
Q1
2020
|
|
Q2
2020
|
|
Q3
2020
|
|
Q4
2020
|
|
Q1
2021
|
|
Q2
2021
|
|
|
Core
|
|
|
36,347
|
|
|
|
30,213
|
|
|
|
32,126
|
|
|
|
30,920
|
|
|
|
31,447
|
|
|
|
37,817
|
|
|
|
Access
Physicians
|
|
|
20,067
|
|
|
|
21,577
|
|
|
|
26,357
|
|
|
|
30,925
|
|
|
|
33,399
|
|
|
|
31,700
|
|
|
|
Telemed IQ
|
|
|
31,175
|
|
|
|
35,777
|
|
|
|
48,085
|
|
|
|
57,642
|
|
|
|
63,001
|
|
|
|
60,697
|
|
|
|
Total
Consults
|
|
|
87,589
|
|
|
|
87,567
|
|
|
|
106,568
|
|
|
|
119,487
|
|
|
|
127,847
|
|
|
|
130,214
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOC Telemed, Inc.
and Subsidiaries and Affiliates
CONSOLIDATED
BALANCE SHEETS
(In thousands,
except shares and per share amounts)
(Unaudited)
|
|
ASSETS
|
June 30,
2021
|
|
December 31,
2020
|
CURRENT
ASSETS
|
|
|
|
Cash and cash
equivalents (from variable interest entities $9,117 and $1,942,
respectively)
|
$
50,005
|
|
$
38,754
|
Accounts receivable,
net of allowance for doubtful accounts of $468 and $447
(from variable interest entities, net of allowance $13,067 and
$8,192,
respectively)
|
14,438
|
|
8,721
|
Inventory
|
1,356
|
|
-
|
Prepaid expenses and
other current assets (from variable interest entities
$130 and $0, respectively)
|
4,997
|
|
1,609
|
Total current assets
|
70,796
|
|
49,084
|
|
|
|
|
Property and equipment,
net
|
3,970
|
|
4,092
|
Capitalized software
costs, net
|
10,062
|
|
8,935
|
Intangible assets,
net
|
46,204
|
|
5,988
|
Goodwill
|
155,647
|
|
16,281
|
Deposits and other
assets
|
1,843
|
|
559
|
Total
assets
|
$
288,522
|
|
$
84,939
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Accounts payable (from
variable interest entities $2,526 and $692,
respectively)
|
$
8,271
|
|
$
2,809
|
Accrued expenses (from
variable interest entities $3,361 and $1,349,
respectively)
|
11,221
|
|
8,293
|
Deferred
revenues
|
531
|
|
610
|
Capital lease
obligations
|
22
|
|
-
|
Contingent
consideration
|
318
|
|
-
|
Stock-based
compensation liabilities
|
-
|
|
4,228
|
Total current liabilities
|
20,363
|
|
15,940
|
|
|
|
|
Deferred
revenues
|
1,012
|
|
923
|
Capital lease
obligations
|
52
|
|
-
|
Long term debt, net of
unamortized discount and debt issuance costs
|
73,563
|
|
-
|
Contingent shares
issuance liabilities
|
6,806
|
|
12,450
|
Other long-term
liabilities (from variable interest entities $157 and $157,
respectively)
|
560
|
|
560
|
Total
liabilities
|
$
102,356
|
|
$
29,873
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
Class A common stock,
$0.0001 par value; 500,000,000 shares authorized as
of June 30, 2021 and December 31, 2020; 98,233,640 and
74,898,380
shares issued and outstanding at June 30, 2021 and
December 31, 2020,
respectively.
|
10
|
|
8
|
Preferred stock,
$0.0001 par value, 5,000,000 shares authorized; none issued
and outstanding as of June 30, 2021 and December 31,
2020, respectively.
|
-
|
|
-
|
Additional paid-in
capital
|
449,428
|
|
291,277
|
Accumulated
deficit
|
(263,272)
|
|
(236,219)
|
Total
stockholders' equity (deficit)
|
186,166
|
|
55,066
|
|
|
|
|
Total
liabilities, contingently redeemable preferred
stock and stockholders' equity
|
|
|
|
$
288,522
|
$
84,939
|
SOC Telemed, Inc.
and Subsidiaries and Affiliates
CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands,
except shares and per share amounts)
(Unaudited)
|
|
|
|
Three Months
Ended
June 30,
|
|
|
Six Months
Ended
June 30,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Revenues
|
|
$
|
24,960
|
|
|
$
|
13,554
|
|
|
$
|
39,781
|
|
|
$
|
28,361
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
16,937
|
|
|
|
9,030
|
|
|
|
26,704
|
|
|
|
19,743
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
|
22,479
|
|
|
|
9,753
|
|
|
|
43,740
|
|
|
|
18,274
|
|
Changes in fair value
of contingent consideration
|
|
|
(2,947)
|
|
|
|
-
|
|
|
|
(2,947)
|
|
|
|
-
|
|
Total operating expenses
|
|
|
19,532
|
|
|
|
9,753
|
|
|
|
40,793
|
|
|
|
18,274
|
|
Loss from operations
|
|
|
(11,509)
|
|
|
|
(5,229)
|
|
|
|
(27,716)
|
|
|
|
(9,656)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on contingent
shares issuance liabilities
|
|
|
2,192
|
|
|
|
-
|
|
|
|
5,644
|
|
|
|
-
|
|
Loss on puttable
option liabilities
|
|
|
-
|
|
|
|
(96)
|
|
|
|
-
|
|
|
|
(105)
|
|
Interest
expense
|
|
|
(3,123)
|
|
|
|
(2,836)
|
|
|
|
(3,272)
|
|
|
|
(5,616)
|
|
Interest expense –
Related party
|
|
|
(2,001)
|
|
|
|
-
|
|
|
|
(2,026)
|
|
|
|
-
|
|
Total other income (expense)
|
|
|
(2,932)
|
|
|
|
(2,932)
|
|
|
|
346
|
|
|
|
(5,721)
|
|
Loss before income taxes
|
|
|
(14,441)
|
|
|
|
(8,161)
|
|
|
|
(27,370)
|
|
|
|
(15,377)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
(expense)
|
|
|
(17)
|
|
|
|
(2)
|
|
|
|
317
|
|
|
|
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss and
comprehensive loss
|
|
$
|
(14,458)
|
|
|
$
|
(8,163)
|
|
|
$
|
(27,053)
|
|
|
$
|
(15,380)
|
|
Accretion of
contingently redeemable preferred stock
|
|
|
-
|
|
|
|
(2,023)
|
|
|
|
-
|
|
|
|
(3,518)
|
|
Net loss
attributable to common stockholders
|
|
$
|
(14,458)
|
|
|
$
|
(10,186)
|
|
|
$
|
(27,053)
|
|
|
$
|
(18,898)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share
attributable to common stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.16)
|
|
|
$
|
(0.30)
|
|
|
$
|
(0.32)
|
|
|
$
|
(0.55)
|
|
Diluted
|
|
$
|
(0.16)
|
|
|
$
|
(0.30)
|
|
|
$
|
(0.32)
|
|
|
$
|
(0.55)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares used to compute net loss per
share attributable to common
stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
89,697,396
|
|
|
|
34,345,197
|
|
|
|
83,744,959
|
|
|
|
34,345,197
|
|
Diluted
|
|
|
89,697,396
|
|
|
|
34,345,197
|
|
|
|
83,744,959
|
|
|
|
34,345,197
|
|
SOC Telemed, Inc.
and Subsidiaries and Affiliates
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In
thousands)
(Unaudited)
|
|
|
|
Six Months
Ended
June 30,
|
|
|
|
2021
|
|
|
2020
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(27,053)
|
|
|
$
|
(15,380)
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
4,141
|
|
|
|
2,607
|
|
Stock-based
compensation
|
|
|
10,644
|
|
|
|
247
|
|
Change in fair value
of contingent consideration
|
|
|
(2,947)
|
|
|
|
-
|
|
Loss on puttable
option liabilities
|
|
|
-
|
|
|
|
105
|
|
(Gain) on contingent
shares issuance liabilities
|
|
|
(5,644)
|
|
|
|
|
-
|
Bad debt
expense
|
|
|
47
|
|
|
|
43
|
|
Paid-in kind interest
on long-term debt
|
|
|
203
|
|
|
|
1,527
|
|
Amortization of debt
issuance costs and issuance discount
|
|
|
3,403
|
|
|
|
710
|
|
Income tax
benefit
|
|
|
(343)
|
|
|
|
-
|
|
Change in assets and
liabilities, net of acquisitions
|
|
|
|
|
|
|
|
|
Accounts
receivable, net of allowance
|
|
|
(162)
|
|
|
|
2,981
|
|
Prepaid
expense and other current assets
|
|
|
(2,752)
|
|
|
|
(1,472)
|
|
Inventory
|
|
|
26
|
|
|
|
-
|
|
Deposits
and other non-current assets
|
|
|
(999)
|
|
|
|
11
|
|
Accounts
payable
|
|
|
2,647
|
|
|
|
(921)
|
|
Accrued
expenses and other current liabilities
|
|
|
742
|
|
|
|
2,334
|
|
Deferred
revenues
|
|
|
9
|
|
|
|
143
|
|
Net cash used in
operating activities
|
|
|
(18,038)
|
|
|
|
(7,065)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Capitalization of software development costs
|
|
|
(2,132)
|
|
|
|
(2,090)
|
|
Purchase of property and equipment
|
|
|
(635)
|
|
|
|
(1,222)
|
|
Acquisition of business, net of cash
|
|
|
(89,752)
|
|
|
|
-
|
|
Net cash used
in investing activities
|
|
|
(92,519)
|
|
|
|
(3,312)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Principal payments under capital lease obligations
|
|
|
-
|
|
|
|
(45)
|
|
Proceeds from long-term debt, net of discount
|
|
|
83,219
|
|
|
|
-
|
|
Proceeds from Related-party – Unsecured subordinated promissory
note
|
|
|
11,500
|
|
|
|
-
|
|
Repayment of long-term debt
|
|
|
(10,795)
|
|
|
|
-
|
|
Repayment of Related-party – Unsecured subordinated promissory
note, net of
unamortized discount
|
|
|
(13,703)
|
|
|
|
-
|
|
Proceeds from exercise of stock options
|
|
|
42
|
|
|
|
-
|
|
Issuance of contingently redeemable preferred stock
|
|
|
-
|
|
|
|
10,938
|
|
Proceeds from issuance of Class A Common Stock, net of issuance
costs
|
|
|
51,545
|
|
|
|
-
|
|
Net cash
provided by financing activities
|
|
|
121,808
|
|
|
|
10,893
|
|
|
|
|
|
|
|
|
|
|
NET (DECREASE)
INCREASE IN CASH AND CASH EQUIVALENTS
|
|
|
11,251
|
|
|
|
516
|
|
Cash and cash
equivalents at beginning of the period
|
|
|
38,754
|
|
|
|
4,541
|
|
Cash and cash
equivalents at end of the period
|
|
$
|
50,005
|
|
|
$
|
5,057
|
|
|
|
|
|
|
|
|
|
|
SOC Telemed,
Inc. and Subsidiaries and Affiliates
RECONCILIATION OF
GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands,
except per share data) (Unaudited)
|
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
% Change
|
|
Change
|
|
% Change
|
|
|
(dollars in
thousands)
|
Revenues
|
|
$
|
24,960
|
|
|
$
|
13,554
|
|
|
$
|
39,781
|
|
|
$
|
28,361
|
|
|
$
|
11,406
|
|
|
84
|
%
|
|
$
|
11,420
|
|
|
40
|
%
|
Cost of
revenues
|
|
|
16,937
|
|
|
|
9,030
|
|
|
|
26,704
|
|
|
|
19,743
|
|
|
|
7,907
|
|
|
88
|
%
|
|
|
6,961
|
|
|
35
|
%
|
Gross
profit
|
|
|
8,023
|
|
|
|
4,524
|
|
|
|
13,077
|
|
|
|
8,618
|
|
|
|
3,499
|
|
|
77
|
%
|
|
|
4,459
|
|
|
52
|
%
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
(a)
|
|
|
1,222
|
|
|
|
911
|
|
|
|
2,444
|
|
|
|
1,803
|
|
|
|
311
|
|
|
34
|
%
|
|
|
641
|
|
|
36
|
%
|
Equipment leasing
costs (b)
|
|
|
4
|
|
|
|
18
|
|
|
|
8
|
|
|
|
42
|
|
|
|
(14)
|
|
|
(78)
|
%
|
|
|
(34)
|
|
|
(81)
|
%
|
Stock based
compensation
(e)
|
|
|
6
|
|
|
|
-
|
|
|
|
6
|
|
|
|
-
|
|
|
|
6
|
|
|
*
|
|
|
|
6
|
|
|
*
|
|
Adjusted gross
profit
|
|
$
|
9,255
|
|
|
$
|
5,453
|
|
|
$
|
15,535
|
|
|
$
|
10,463
|
|
|
|
3,802
|
|
|
70
|
%
|
|
|
5,072
|
|
|
48
|
%
|
Adjusted gross
margin
(as a percentage revenues)
|
|
|
37
|
%
|
|
|
40
|
%
|
|
|
39
|
%
|
|
|
37%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
Change
$
|
|
Change
%
|
|
Change
$
|
|
Change
%
|
|
|
(dollars in
thousands)
|
Net loss
|
|
$
|
(14,458)
|
|
|
$
|
(8,163)
|
|
|
$
|
(27,053)
|
|
|
$
|
(15,380)
|
|
|
$
|
(6,295)
|
|
|
77
|
%
|
|
$
|
(11,673)
|
|
|
76
|
%
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
(c)
|
|
|
5,124
|
|
|
|
2,836
|
|
|
|
5,298
|
|
|
|
5,616
|
|
|
|
2,288
|
|
|
81
|
%
|
|
|
(318)
|
|
|
(6)
|
%
|
Income tax
expense
(benefit) (d)
|
|
|
17
|
|
|
|
2
|
|
|
|
(317)
|
|
|
|
3
|
|
|
|
15
|
|
|
*
|
|
|
|
(320)
|
|
|
*
|
|
Depreciation and
amortization (a)
|
|
|
2,480
|
|
|
|
1,317
|
|
|
|
4,141
|
|
|
|
2,607
|
|
|
|
1,163
|
|
|
88
|
%
|
|
|
1,534
|
|
|
59
|
%
|
Stock-based
compensation (e)
|
|
|
4,786
|
|
|
|
148
|
|
|
|
10,644
|
|
|
|
247
|
|
|
|
4,638
|
|
|
3,128
|
%
|
|
|
10,397
|
|
|
4,209
|
%
|
Gain on contingent
shares
issuance liabilities (f)
|
|
|
(2,192)
|
|
|
|
-
|
|
|
|
(5,644)
|
|
|
|
-
|
|
|
|
(2,192)
|
|
|
*
|
|
|
|
(5,644)
|
|
|
*
|
|
Loss on puttable
option
liabilities (g)
|
|
|
-
|
|
|
|
96
|
|
|
|
-
|
|
|
|
105
|
|
|
|
(96)
|
|
|
(100)
|
%
|
|
|
(105)
|
|
|
(100)
|
%
|
Gain on change in
fair
value of contingent
consideration (h)
|
|
|
(2,947)
|
|
|
|
-
|
|
|
|
(2,947)
|
|
|
|
-
|
|
|
|
(2,947)
|
|
|
*
|
|
|
|
(2,947)
|
|
|
*
|
|
Integration,
acquisition,
transaction, and executive
severance costs (i)
|
|
|
1,772
|
|
|
|
2,130
|
|
|
|
5,909
|
|
|
|
2,503
|
|
|
|
(358)
|
|
|
(17)
|
%
|
|
|
3,406
|
|
|
136
|
%
|
Adjusted
EBITDA
|
|
$
|
(5,418)
|
|
|
$
|
(1,634)
|
|
|
$
|
(9,969)
|
|
|
$
|
(4,299)
|
|
|
|
(3,784)
|
|
|
232
|
%
|
|
|
(5,670)
|
|
|
132
|
%
|
|
* Percentage
not meaningful
|
|
|
For the Three
Months Ended
|
|
|
|
|
|
|
June 30,
2021
|
|
June 30,
2020
|
|
Change
$
|
|
Change
%
|
|
|
(dollars in
thousands)
|
|
|
Selling, general and
administrative expenses (1)
|
|
$
|
22,479
|
|
$
|
9,753
|
|
$
|
12,726
|
|
|
130
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
|
2,397
|
|
|
1,446
|
|
|
951
|
|
|
66
|
%
|
Research and
development
|
|
|
530
|
|
|
255
|
|
|
275
|
|
|
108
|
%
|
Operations
|
|
|
2,548
|
|
|
2,088
|
|
|
460
|
|
|
22
|
%
|
General and
administrative
|
|
|
17,004
|
|
|
5,964
|
|
|
11,040
|
|
|
185
|
%
|
|
|
$
|
22,479
|
|
$
|
9,753
|
|
$
|
12,726
|
|
|
130
|
%
|
(1)
|
Selling, general, and
administrative expenses include the following expenses for the
periods presented:
|
|
Three Months Ended
June 30, 2021
|
Three Months Ended
June 30, 2020
|
|
Stock-Based Compensation
|
Depreciation
and
Amortization
|
Integration Costs
|
Stock-Based Compensation
|
Depreciation
and
Amortization
|
Integration Costs
|
|
(dollars in
thousands)
|
Sales and
marketing
|
$
|
73
|
|
$
|
—
|
|
$
|
—
|
|
$
|
8
|
|
$
|
—
|
$
|
—
|
Research and
development
|
|
180
|
|
|
—
|
|
|
—
|
|
|
33
|
|
|
—
|
|
—
|
Operations
|
|
184
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|
—
|
|
—
|
General and
administrative
|
|
4,343
|
|
|
1,303
|
|
|
1,772
|
|
|
86
|
|
|
417
|
|
2,130
|
|
$
|
4,780
|
|
$
|
1,303
|
|
$
|
1,772
|
|
$
|
148
|
|
$
|
417
|
$
|
2,130
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
|
|
|
|
|
June 30,
2021
|
|
June 30,
2020
|
|
Change
$
|
|
Change
%
|
|
|
(dollars in
thousands)
|
|
|
Selling, general and
administrative expenses excluding
stock-based compensation, depreciation and
amortization and integration costs
|
|
$
|
14,624
|
|
$
|
7,058
|
|
$
|
7,566
|
|
|
107
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
|
2,324
|
|
|
1,438
|
|
|
886
|
|
|
62
|
%
|
Research and
development
|
|
|
350
|
|
|
222
|
|
|
128
|
|
|
58
|
%
|
Operations
|
|
|
2,364
|
|
|
2,067
|
|
|
297
|
|
|
14
|
%
|
General and
administrative
|
|
|
9,586
|
|
|
3,331
|
|
|
6,255
|
|
|
188
|
%
|
|
|
$
|
14,624
|
|
$
|
7,058
|
|
$
|
7,566
|
|
|
107
|
%
|
|
|
|
For the Six Months
Ended
|
|
|
|
|
|
|
June 30,
2021
|
|
June 30,
2020
|
|
Change
$
|
|
Change
%
|
|
|
(dollars in
thousands)
|
|
|
Selling, general and
administrative expenses (1)
|
|
$
|
43,740
|
|
$
|
18,274
|
|
$
|
25,466
|
|
|
139
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
|
4,987
|
|
|
2,985
|
|
|
2,002
|
|
|
67
|
%
|
Research and
development
|
|
|
1,058
|
|
|
541
|
|
|
517
|
|
|
96
|
%
|
Operations
|
|
|
5,062
|
|
|
4,182
|
|
|
880
|
|
|
21
|
%
|
General and
administrative
|
|
|
32,633
|
|
|
10,566
|
|
|
22,067
|
|
|
209
|
%
|
|
|
$
|
43,740
|
|
$
|
18,274
|
|
$
|
25,466
|
|
|
139
|
%
|
(1)
|
Selling, general, and
administrative expenses include the following expenses for the
periods presented:
|
|
Six Months Ended
June 30, 2021
|
Six Months Ended
June 30, 2020
|
|
Stock-Based Compensation
|
Depreciation
and
Amortization
|
Integration Costs
|
Stock-Based Compensation
|
Depreciation
and
Amortization
|
Integration Costs
|
|
(dollars in
thousands)
|
Sales and
marketing
|
$
|
343
|
|
$
|
—
|
|
$
|
—
|
|
$
|
14
|
|
$
|
—
|
$
|
—
|
|
Research and
development
|
|
274
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
—
|
|
—
|
|
Operations
|
|
315
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
—
|
|
—
|
|
General and
administrative
|
|
9,705
|
|
|
1,697
|
|
|
5,909
|
|
|
158
|
|
|
815
|
|
2,503
|
|
|
$
|
10,637
|
|
$
|
1,697
|
|
$
|
5,909
|
|
$
|
247
|
|
$
|
815
|
$
|
2,503
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months
Ended
|
|
|
|
|
|
|
June 30,
2021
|
|
June 30,
2020
|
|
Change
$
|
|
Change
%
|
|
|
(dollars in
thousands)
|
|
|
Selling, general and
administrative expenses excluding
stock-based compensation, depreciation and
amortization and integration costs
|
|
$
|
25,497
|
|
$
|
14,709
|
|
$
|
10,788
|
|
|
73
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
|
4,644
|
|
|
2,971
|
|
|
1,673
|
|
|
56
|
%
|
Research and
development
|
|
|
784
|
|
|
500
|
|
|
284
|
|
|
57
|
%
|
Operations
|
|
|
4,747
|
|
|
4,148
|
|
|
600
|
|
|
14
|
%
|
General and
administrative
|
|
|
15,322
|
|
|
7,090
|
|
|
8,232
|
|
|
116
|
%
|
|
|
$
|
25,497
|
|
$
|
14,709
|
|
$
|
10,788
|
|
|
73
|
%
|
Explanation of Non-GAAP Adjustments
(a) Depreciation and amortization consists primarily of
depreciation of fixed assets, amortization of capitalized software
development costs and amortization of acquisition-related
intangible assets, such as customer relationships, non-compete
agreements, and trade names acquired in connection with business
combinations. While depreciation and amortization are non-cash
charges, the assets being depreciated or amortized will often have
to be replaced or updated in the future, and these measures do not
reflect any cash requirements for these replacements or updates.
Additionally, we incur amortization of acquisition-related
intangible assets based on the portion of the purchase price
allocated to intangible assets and the estimated useful lives of
such assets. However, the purchase price allocated to these assets
is not necessarily reflective of the cost we would incur to
internally develop the intangible asset and we do not believe these
charges are reflective of our operating results in the period
incurred. We eliminate these non-cash charges from our non-GAAP
operating results to facilitate an understanding of our operating
and financial performance from period-to-period.
(b) Equipment leasing costs consist of the cost of
procuring telemedicine equipment through lease financing. We ceased
this practice in the second quarter of 2017. We eliminate these
charges from our non-GAAP operating results to facilitate an
understanding of our operating and financial performance from
period-to-period.
(c) Interest expense consists primarily of interest
incurred on our outstanding indebtedness and non-cash interest
related to the amortization of debt discount and issuance costs
associated with our term loan agreement. We eliminate these cash
and non-cash expenses from our non-GAAP operating results to
facilitate an understanding of our operating and financial
performance from period-to-period within our presentation of
adjusted EBITDA. Adjusted EBITDA is widely used by investors to
measure a company's operating performance without regard to items,
such as interest benefit and expense, income tax benefit and
expense, depreciation and amortization, stock-based compensation,
and other charges and income. We believe adjusted EBITDA is useful
in evaluating our operating performance compared to that of other
companies in our industry as this metric generally eliminates the
effects of certain items that may vary from company to company for
reasons unrelated to overall operating performance.
(d) We incur income tax expenses or benefits that are
related to prior periods. We eliminate these expenses from our
non-GAAP operating results to facilitate an understanding of our
operating and financial performance from period-to-period within
our presentation of adjusted EBITDA.
(e) Stock-based compensation expense consists of expenses
for stock options and other stock-based awards. Although
stock-based compensation is a key incentive offered to our
employees, we continue to evaluate our operating and financial
performance excluding stock-based compensation expenses.
Stock-based compensation expenses will recur in future periods. We
evaluate our performance both with and without these measures
because stock-based compensation is a non-cash expense and can vary
significantly over time based on the timing, size, nature and
design of the awards granted, and is influenced in part by certain
factors that are generally beyond our control, such as the
volatility of the market value of our common stock. In addition, we
eliminate stock-based compensation expense from our non-GAAP
operating results to facilitate an understanding of our operating
and financial performance from period-to-period.
(f) Gain on contingent share issuance liabilities consists
of the change in fair value of 1,875,000 shares of our common stock
held by HCMC's sponsor and subsequently distributed to permitted
transferees and were modified and became subject to forfeiture in
connects with the closing of our Merger Transaction, and 350,000
private placement warrants granted to HCMC's sponsor subsequently
distributed to its permitted transferees as part of the Merger
Transaction. The contingent shares issuance liabilities are
revalued at their fair value every reporting period.
(g) Loss on puttable option liabilities consists of
changes in the fair value of puttable option liabilities. We
eliminate these non-cash expenses from our non-GAAP operating
results to facilitate an understanding of our operating and
financial performance from period-to-period.
(h) Gain on change in fair value of contingent
consideration is the change in fair value of the earnout contingent
consideration and the deferred payment in connection with our
acquisition of Access Physicians in Q1 2021. The contingent
consideration is revalued every reporting period based on the
estimation of the likelihood that such contingent consideration
will be earned. We eliminate these non-cash activities from our
non-GAAP operating results to facilitate an understanding of our
operating and financial performance from period-to-period.
(i) Integration, acquisition, transaction and executive
severance costs represent the transaction and business integration
costs related to our business combination with Healthcare Merger
Corp. in Q4 2020 and our acquisition of Access Physicians in Q1
2021. These costs include incremental expenses incurred to
affect business combinations such as advisory, legal, accounting,
valuation, and other professional or consulting fees, as well as
other related incremental executive severance costs. We exclude
these costs from our non-GAAP results as they have no direct
correlation to the operation of our business, and because we
believe that the non-GAAP financial measures excluding these costs
provide useful information about our spending trends to facilitate
an understanding of our operating and financial performance from
period-to-period.
Media Relations:
Lauren Shankman
Trevelino/Keller
lshankman@trevelinokeller.com
Investor Relations:
Steve Rubis
Vice President, Investor Relations
SOC Telemed
P: (214) 681-7991
srubis@soctelemed.com
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SOURCE SOC Telemed