VitalHub Corp. (the “Company” or “VitalHub”) (TSXV: VHI) announced
today it has filed its Interim Condensed Consolidated Financial
Statements and Management's Discussion and Analysis report for the
quarter ended June 30, 2019 with the Canadian securities
authorities. These documents may be viewed under the Company's
profile at www.sedar.com.
When asked to comment on the results of Q2 2019,
VitalHub CEO Dan Matlow said, “We continue to make progress
quarter-over-quarter in all areas of our business and continue to
be optimistic on a go-forward basis, as we offer the following
insight to help guide our investors at this time."
- “Due to the high amount of non-cash items on the Company’s
income statement relating to the amortization of intangibles from
acquisitions, we focus primarily on Adjusted EBITDA to track our
performance. We have made great progress here, with Adjusted EBITDA
representing 23% of revenues for the period ended June 30, 2019.
Adjusted EBITDA is a non-IFRS measure.
- Our annual contract value (“ACV”) has grown to $5,321,119,
which has not yet been materially affected by the Nova Scotia
contract revenue, which has the potential to grow to $2.3M in ACV.
Revenue associated with this contract has primarily been comprised
of professional services to-date, and has only accounted for 2% or
$125,450 of the total ACV currently reported. Our expectation is
for the Nova Scotia ACV to progressively increase starting in Q4 of
this year. (For further details on the Nova Scotia contract, refer
to the original press release dated January 7, 2019.) ACV is a
non-IFRS measure.
- Recurring revenue continues to grow and now represents 46.5% of
total revenue for the quarter. Recurring revenue is a non-IFRS
measure.
- While M&A is an important part of our growth strategy, the
Company continues to grow organically with 44% of revenue
representing organic growth for the quarter.
- The Oak Group acquisition completed in March 2019 and in
particular its MCAP product represents an opportunity for growth
internationally. We continue to see pipeline growth on an
international basis.
- The company has been gradually increasing our cash reserves,
and at the end of Q2 had $4,860,083 of cash.”
COMPANY HIGHLIGHTS
Revenue for the for the three
months ended June 30, 2019 was $2,827,291 as compared to $1,856,446
for the three months ended June 30, 2018, an increase of $970,845
or 52.3% (an increase of $382,981 or 15.7% over the three months
ended March 31, 2019). Revenue for the six months ended June 30,
2019 was $5,271,602 as compared to $4,779,836 (which includes a
one-time perpetual license fee of $1,613,362) for the six months
ended June 30, 2018, an increase of $491,776 or 10.3%.
EBITDA (defined as earnings
before interest, taxation, depreciation and amortization) for the
three months ended June 30, 2019 was $337,108 as compared to
($33,212) for the three months ended June 30, 2018, an increase of
$370,320. EBITDA for the six months ended June 30, 2019 was
$904,640 as compared to $348,515 for the six months ended June 30,
2018, an increase of $556,125. EBITDA is a non-IFRS
measure.
Adjusted EBITDA (defined as
earnings before interest, taxation, depreciation, amortization,
share based compensation, and acquisition related expenses) for the
three months ended June 30, 2019 was $552,524 as compared to
$20,693 for the three months ended June 30, 2018, an increase of
$531,831. Adjusted EBITDA for the six months ended June 30, 2019
was $1,209,290 as compared to $771,568 for the six months ended
June 30, 2018, an increase of $437,722. Adjusted EBITDA is a
non-IFRS measure.
Adjusted EBITDA as a percentage
revenue for the three months ended June 30, 2019 was 20%
as compared to 1% for the three months ended June 30, 2018. For the
six months ended June 30, 2019 adjusted EBITDA as a percentage
revenue was 23% as compared to 16% for the six months ended June
30, 2018. Adjusted EBITDA as a percentage revenue is a non-IFRS
measure.
The Company defines Annualized Contract
Value (“ACV”) of recurring revenue as the contracted annual
renewable software license fees and maintenance services.
The ACV of recurring revenue at June 30, 2019 was $5,321,119 as
compared to $5,226,623 at March 31, 2019 an increase of 2%. ACV is
a non-IFRS measure.
The Company defines acquisition revenue
as gross revenues of the companies acquired at the time of
acquisition and organic revenue as revenue over and above the
acquisition revenues. For the three months ended
June 30, 2019, organic revenue represented 44% of total revenue
(Q2/2018 – 20%, Q4/2018 – 29%, Q1/2019 – 35%), with the remaining
56% representing acquisition revenue (Q2/2018 – 80%, Q4/2018 – 71%,
Q1/2019 – 65%). Acquisition and organic revenue are non-IFRS
measures.
In the quarter, two new contracts were
signed which include software licensing revenue of
$417,225, professional service revenue of approximately $184,685,
and approximately $101,825 of recurring revenue over the initial
term.
In addition, the Company
signed a contract to provide its TREAT solution to
The Hawskesbury and District General Hospital as part of the
regionalized expansion of the TREAT EHR through Ottawa
Hospital, 15 organizations are now eligible to
sign a Participation Agreement allowing them to license the TREAT
software.
ABOUT VITALHUB:
VitalHub develops mission-critical technology
solutions for Health and Human Services providers in
the Mental Health (Child through Adult), Long Term
Care, Community Health Service, Home Health, Social Service
and Acute Care sectors. VitalHub technologies
include Blockchain, Mobile, Patient Flow, Web-Based
Assessment and Electronic Health Record solutions. The Company
has a robust two-pronged growth strategy, targeting organic growth
opportunities within its product suite, and pursuing an aggressive
M&A plan. Currently, VitalHub serves 200+ clients across
North America. VitalHub is based in Toronto, Canada, with
an offshore development hub in Sri Lanka. The Company is
publicly traded on the TSX Venture Exchange under the symbol
“VHI”.
CAUTIONARY STATEMENT:
This press release includes forward-looking
statements regarding the Corporation and its business, which may
include, but is not limited to, statements with respect to the
appointment of a new directors. Often, but not always,
forward-looking statements can be identified by the use of words
such as "plans", "is expected", "expects", "scheduled", "intends",
"contemplates", "anticipates", "believes", "proposes" or variations
(including negative variations) of such words and phrases, or state
that certain actions, events or results "may", "could", "would",
"might" or "will" be taken, occur or be achieved. Such statements
are based on the current expectations of the management of each
entity, and are based on assumptions and subject to risks and
uncertainties. Although the management of each entity believes that
the assumptions underlying these statements are reasonable, they
may prove to be incorrect. The forward-looking events and
circumstances discussed in this release, including the share
consolidation proposal, may not occur by certain specified dates or
at all and could differ materially as a result of known and unknown
risk factors and uncertainties affecting the companies, including
risks regarding the technology industry, failure to obtain
regulatory or shareholder approvals, market conditions, economic
factors, the equity markets generally and risks associated with
growth and competition. Although the Corporation has attempted to
identify important factors that could cause actual actions, events
or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results to differ from those anticipated,
estimated or intended. No forward-looking statement can be
guaranteed. Except as required by applicable securities laws,
forward-looking statements speak only as of the date on which they
are made and the Corporation undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result
of new information, future events, or otherwise.
CONTACT INFORMATION
Dan MatlowChief Executive Officer, Director(416)
727-9061dan.matlow@vitalhub.com
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