- Yearly revenue more than tripled to $32,810,782 in the 12-month period ended
December 31, 2019 versus the
comparable period ended December 31,
20181.
- Subsequent to the end of the fiscal year, WELL expanded its EMR
network to 1446 clinics by completing the acquisition of Trinity
Healthcare Technologies ("THT"). WELL also announced the proposed
acquisition of MedBASE Software Inc. ("MedBASE") which shall boost
the company's EMR network to over 1,500 clinics across Canada.
- Also subsequent to the end of the fiscal year, WELL
successfully launched VirtualClinic+ a unique and comprehensive
telehealth program across Canada
that allows family physicians to not only provide care for their
own roster of attached patients but also provide care for
unattached patients.
- Due to the COVID-19 pandemic, WELL is currently executing on
its business continuity plan which includes the rapid adoption of
telehealth services via the VirtualClinic+ program. Thus far WELL's
public insured clinical revenue is proving to be highly resilient
and continues to generally track in line with the prior year's
results. WELL is aggressively ramping up physicians from its own
network of primary clinics as well as from its EMR network on its
VirtualClinic+ telehealth platform.
VANCOUVER, March 31, 2020 /CNW/ - WELL Health
Technologies Corp. (TSX.T: WELL)
(the "Company" or "WELL"), a company
focused on consolidating and modernizing clinical and digital
assets within the primary healthcare sector, announces it has filed
its 2019 Annual Audited consolidated financial statements and
MD&A for the 12-month period ended December 31, 2019.
On December 11, 2018, the Board of
Directors approved a resolution to change the Company's year-end
from October 31 to December 31.
Accordingly, the audited consolidated financial statements include
the results for the 12-month period ended December 31, 2019 with comparatives for the 14
months ended December 31, 2018.
2019 Annual Financial and Business Highlights:
- WELL achieved record annual revenue of $32,810,782 during the 12 months ended
December 31, 2019 compared to revenue
of $10,559,800 generated during the
14 months ended December 31, 2018 -
an increase of 211% primarily attributable to the Company's
acquisitions over the past year.
- Gross margin(2) percentage increased to 33.5% in the
12 months ended December 31, 2019,
compared to 29.7% in the 14 months ended December 31, 2018 mainly due to the addition of
higher margin digital services revenue.
- Adjusted EBITDA(3)(4) loss was $1,713,414 for the 12-month period ended
December 31, 2019, compared to
Adjusted EBITDA(2) loss of $1,178,839 in the 14-month period ended
December 31, 2018.
- WELL ended the year with a strong balance sheet with
$15,643,607 in cash and cash
equivalents as at December 31,
2019.
- In 2019 WELL established itself as the third largest Electronic
Medical Records (EMR) service provider in Canada through the acquisition of four
OSCAR EMR service providers: NerdEMR
Services Ltd., OSCARprn - Treatment Solutions Ltd., Kela Atlantic
Inc. dba KAI Innovations and OSCARwest EMR Services. WELL expanded
its digital services EMR footprint to 946 primary health medical
clinics by the end of 2019. The Company expects to further increase
its footprint to supporting approximately 1,507 clinics and over
8,000 registered physicians and practitioners across Canada with the subsequent closing of THT and
proposed acquisition of MedBASE.
- WELL also completed two majority ownership acquisitions in
2019: a 51% majority stake ownership in SleepWorks Medical Inc. in
October 2019 and a 51% majority stake
ownership in Spring Medical Centre Ltd. in December 2019.
2019 Fourth Quarter Financial Highlights:
- WELL achieved record quarterly revenue of $9,830,790 during the three months ended
December 31, 2019 compared to revenue
of $4,662,456 during the comparable
two-month period ended December 31,
2018 - an increase of 111% primarily attributable to the
Company's acquisitions over the past year.
- Gross margin(2) increased to 36.5% in the three
months ended December 31, 2019,
compared to 30.2% in the comparable two-month period ended
December 31, 2018 mainly due to the
addition of higher margin digital services revenue.
- WELL achieved a Net profit of $216,067 in the three months ended December 31, 2019, compared to a loss of
$533,270 in the two-month period
ended December 31, 2018.
- "We had an excellent fourth quarter. We demonstrated growth and
strength in both our clinical and digital businesses," said
Hamed Shahbazi, Chairman and CEO of
WELL. "2019 was a momentous year for WELL as we established
ourselves as a leader in providing technology enabled healthcare
services".
Subsequent Events:
- On January 10, 2020, the Company
delisted from the TSX Venture Exchange and graduated to the Toronto
Stock Exchange ("TSX").
- On February 1, 2020, the Company
completed the acquisition of THT for approximately $7,225,000. THT is the second largest OSCAR
service provider in Canada
bringing an additional ~500 clinics to WELL's EMR network.
- On February 12, 2020, the Company
announced an agreement to acquire MedBASE for total consideration
of $650,000. With this proposed
transaction, WELL anticipates it will increase its EMR footprint to
supporting approximately 1,507 primary medical health clinics
across Canada.
- On March 2, 2020, the Company
announced the launch of VirtualClinic+. VirtualClinic+ is a digital
health communications platform that connects patients to physicians
through video, phone and secure messaging.
- On March 12, 2020, the Company
announced the closing of a $10,000,000 non-brokered private placement
offering of senior unsecured convertible debentures from a single
large Canadian institutional investor. On March 16, 2020, the Company closed an additional
tranche of $1,000,000 convertible
debentures to include Mr. Li
Ka-shing and one other investor.
- On March 23, 2020, the Company
announced a Normal Course Issuer Bid of up to 5,943,822 common
shares (5% of the issued and outstanding shares), commencing on
March 25, 2020 over the next 12-month
period.
- On March 26, 2020, the Company
announced a $5.94M investment in
Insig Corporation ("Insig") including a share exchange for WELL
common shares representing a deemed consideration of approximately
$3.94M and a $2M secured convertible promissory note. WELL
also entered into a strategic alliance agreement with Insig to
launch a WELL branded telehealth platform called
"VirtualClinic+".
Covid-19 Update:
As a result of the COVID-19 pandemic, WELL is currently
executing on its business continuity plan, which includes ramping
up physicians on its VirtualClinic+ telehealth platform so that we
may continue to provide care to our patients remotely when
appropriate and instituting a mandatory work from home policy for
the vast majority of our corporate headquarters and WELL EMR Group
employees. Our clinics remain open as they are considered an
essential service.
While the COVID-19 pandemic has introduced many uncertainties
and disruption to most industries, we feel the Company is well
positioned in the current environment. WELL has a strong
balance sheet, a robust pipeline of growth opportunities, a solid
base of recurring revenue in its Digital EMR business and is
actively ramping up its VirtualClinic+
telehealth service. Thus far WELL's public insured
clinical revenue is proving to be highly resilient and continues to
generally track in line with the prior year. WELL has
successfully deployed its VirtualClinic+ telehealth program to all
its 20 corporate owned clinics in B.C. and onboarded most of the
doctors that work in these WELL clinics. Furthermore, WELL
has already, in a matter of days/weeks, onboarded hundreds more
healthcare providers from its OSCAR
EMR network of approximately 1,500 clinics across
Canada.
Outlook:
WELL expects Fiscal Q1 revenue, ending March 31, 2020, to benefit from the closing of
the THT acquisition and a full quarter of contribution from the
acquisitions of OSCARwest and Spring Medical Centre. COVID-19
is expected to have a minimal impact to WELL's Q1
results.
The Company's goals for 2020 continue to be: (i) achieving
organic revenue growth in its operating businesses; (ii) continue
to follow a disciplined acquisition strategy; and (iii) increasing
market penetration of the VirtualClinic+ telehealth service.
Conference Call:
WELL will hold a conference call to discuss its 2019 Annual and
Fourth Quarter financial results on Tuesday,
March 31, 2020 at 1:00 pm ET
(10:00 am PT). Please use the
following dial-in numbers: 416-764-8650 (Toronto local), 778-383-7413 (Vancouver local) or 1-888-664-6383
(Toll-Free), with Conference ID: 6114 5790.
Selected Financial Highlights:
Please see SEDAR for complete copies of the
Company's Audited Annual consolidated financial statements and
MD&A for fiscal 2019 ended December 31,
2019.
|
Three
months
ended
December
31, 2019
|
Twelve
months ended
December 31,
2019
|
Fourteen
months
ended
December
31, 2018
|
|
$
|
$
|
$
|
Revenue
|
9,830,790
|
32,810,782
|
10,559,800
|
Cost of clinical and
digital services
|
(6,240,391)
|
(21,821,367)
|
(7,424,021)
|
Gross
Profit(2)
|
3,590,399
|
10,989,415
|
3,135,779
|
Gross
Margin(2)
|
36.5%
|
33.5%
|
29.7%
|
Adjusted
EBITDA(3) (4)
|
(306,618)
|
(1,713,414)
|
(1,178,839)
|
Net profit (loss)
from continuing operations(4)
|
216,067
|
(7,793,914)
|
(2,595,448)
|
Total comprehensive
income (loss) for the period(4)
|
216.067
|
(7,793,914)
|
(2,801,501)
|
Net loss per share -
from continuing operations
|
(0.00)
|
(0.08)
|
(0.04)
|
Net loss per share -
for the period
|
(0.00)
|
(0.08)
|
(0.04)
|
Weighted average
number of common shares
outstanding (basic and diluted)
|
110,099,269
|
96,919,161
|
66,498,245
|
|
|
|
|
Reconciliation of
net income to Adjusted EBITDA
|
|
|
|
Net profit (loss) for
the period
|
216,067
|
(7,793,914)
|
(2,809,887)
|
Depreciation and
amortization
|
944,888
|
2,155,046
|
21,987
|
Income tax
|
(125,941)
|
35,235
|
-
|
Interest
income
|
(101,590)
|
(241,402)
|
(57,843)
|
Interest
expense
|
367,044
|
1,446,057
|
26,351
|
Rent expense on
finance leases
|
(350,881)
|
(1,642,680)
|
-
|
Stock-based
compensation
|
684,937
|
2,935,912
|
905,515
|
Net loss from
discontinued operations
|
-
|
-
|
214,439
|
Special warrants
related expenses
|
(2,702,240)
|
(243,450)
|
-
|
Time-based earn-out
expense
|
560,227
|
948,603
|
64,481
|
Transaction,
restructuring, & integration costs
expensed
|
200,871
|
687,179
|
456,118
|
Adjusted
EBITDA(3) (4)
|
(306,618)
|
(1,713,414)
|
(1,178,839)
|
Note:
|
|
(1)
|
The comparative
period in 2018 was the 14-month period ended Dec 2018 as a result
of the company's change in fiscal year end in 2018 from Oct 31 to
Dec 31.
|
(2)
|
Non-GAAP
measure. Gross profit and gross margin do not have any
standardized meaning under IFRS and therefore may not be comparable
to similar measures presented by other issuers. The Company
defines gross profit as revenue less cost of clinical and digital
services and gross margin as gross profit as a percentage of
revenue. Gross profit and gross margin should not be
construed as an alternative for revenue or net loss determined in
accordance with IFRS. The Company believes that gross profit
and gross margin are meaningful metrics in assessing the Company's
financial performance and operational efficiency.
|
(3)
|
Non-GAAP
measure. Earnings before interest, taxes, depreciation and
amortization ("EBITDA") and Adjusted EBITDA should not be used as
alternatives to net income/loss determined in accordance with
IFRS. EBITDA and Adjusted EBITDA do not have any standardized
meaning under IFRS and therefore may not be comparable to similar
measures presented by other issuers. The Company defines
Adjusted EBITDA as EBITDA (i) less net rent expense on premise
leases considered to be finance leases under IFRS and (ii) before
transaction, restructuring, and integration costs, discontinued
operations, time-based earn-out expense, special warrant related
expenses and stock-based compensation expense. The Company
believes that Adjusted EBITDA is a meaningful financial metric as
it measures cash generated from operations which the Company can
use to fund working capital requirements, service future interest
and principal debt repayments and fund future growth
initiatives.
|
(4)
|
On January 1,
2019, the Company adopted IFRS 16 – Leases ("IFRS 16"). The
adoption of this new standard had a significant impact on the
Company's financial statements, including its statement of loss and
comprehensive loss, statement of financial position and statement
of cash flows. As a result of adopting the new standard, the
Company has classified the majority of its premise leases and
subleases as finance leases at January 1, 2019, all of which were
previously classified as operating leases. The Company
adopted the new standard utilizing the modified retrospective
exemption which did not require the restatement of prior
periods. See note 3(n) in the Company's annual consolidated
financial statements for further information on the accounting
treatment of leases under IFRS 16.
|
WELL HEALTH TECHNOLOGIES CORP.
Per: "Hamed
Shahbazi"
Hamed Shahbazi
Chief Executive Officer, Chairman and Director
About WELL
WELL is a unique company that operates Primary Healthcare
Facilities, is the third largest digital Electronic Medical Records
(EMR) supplier in Canada and is a
provider of telehealth services. WELL owns and operates 20
healthcare clinics, provides digital EMR software and services to
1,446 clinics across Canada and is
a majority owner of SleepWorks Medical. WELL's overarching
objective is to empower doctors to provide the best and most
advanced care possible while leveraging the latest trends in
digital health. WELL is an acquisitive company that has
completed nine acquisitions and two equity investments. WELL
is publicly traded on the Toronto Stock Exchange under the symbol
"WELL.T". WELL was recognized as a TSX Venture 50 Company
three years in a row in 2018, 2019 and 2020.
Forward-Looking Statements
This news release may contain "forward-looking statements"
within the meaning of applicable Canadian securities laws,
including, without limitation: the proposed acquisition of
MedBASE; the statement that the Company's recent financing
transactions gives the Company a strong balance sheet to execute on
its future acquisition growth strategy; the Company's expectation
that Fiscal Q1 revenue to benefit from contribution from the THT
acquisition; the statement relating to securing new acquisitions to
grow both the Company's clinical and digital portfolios in a manner
that is highly accretive to shareholder value both in the short and
long term; and the statements relating to the Company's 2020 growth
strategy consisting of organic growth, in-organic growth and
operational excellence; the intention to provide the best and most
advanced care and leveraging the latest in digital health; and the
expectation that public insured revenue in 2020 will be comparable
to fiscal 2019. Forward-looking statements 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. These statements 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 statements 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 those forward-looking statements and the
forward-looking statements are not guarantees of future
performance. WELL's statements expressed or implied by these
forward-looking statements 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
statements. Forward-looking statements are qualified in their
entirety by inherent risks and uncertainties, including: direct and
indirect material adverse effects from the COVID-19 pandemic;
WELL's assumptions in making forward-looking statements may prove
to be incorrect; 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 future financing on suitable terms; and that
market competition may affect the business, results and financial
condition of WELL. Except as required by securities law, WELL does
not assume any obligation to update or revise any forward-looking
statements, whether as a result of new information, events or
otherwise.
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.
SOURCE WELL Health Technologies Corp.