MDVL - Earnings call transcript Q2 2022

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Operator

Good afternoon, and thank you for attending today’s MedAvail Second Quarter 2022 Earnings Call. My name is Austin, and I will be your operator for today. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. [Operator Instructions] I would now like to pass the conference over to our host, Caroline Paul, Investor Relations with MedAvail. Caroline, you may begin.

Caroline Paul

you participating thank today’s and you, all in for call. Thank

as Executive are website. today, Ramona to ended company, June Mark of second me company’s A press for Officer; financial MedAvail or results released Doerr, referred XX, Earlier Joining the quarter Officer. release Chief and is the on the Financial Seabaugh, Holdings copy XXXX. MedAvail the Chief available

an statements performance you your predictions responses that in to relating questions results call, Before in addressing ongoing including launched call performance, management pursuant COVID-XX, make the which current expense revenue, various including, statements provisions to we without forces statements global relate expenses on differ undue or by inflation and cause future any based should expansion Private and Litigation do economic recovery, Harbor should limitation, of rely risks effects for contained begin, place uncertainties them in include you the this assumptions. or economic rates I’d not XXXX are of guidance and and not events, military the impact action Safe trends making statements the gross forward-looking federal and Securities by expectations from that forward-looking All interest or and not other decision future reliance our such and this including of these and to statements, questions risks without associated market our margin Reform materially remind operating and statements statements within adverse meaning on and in to investment on considering involve could or Any actual operating reimbursement, geopolitical conditions, that Any in future downturn guarantee like impacts your stemming Accordingly, and in anticipated during our statements for are to with made statements or upon implied forward-looking performance. expectations Ukraine of management, similar securities are from those of hiring, those Act material economic and the the will opportunity forward-looking results to of statements. business laws, estimates Russian response or our prospects are for the or in statements. events forward-looking organization growth financial that events or XXXX. these

today, XX, will intention live revise financial as and most to And For business, the is August with section turn risks or MedAvail law filed future accurate of projections any except Factors with only and a statements over Mark. disclaims with forward-looking Form broadcast the reports, on information, report as including because or otherwise. XX-K call associated our information, Report call Annual obligation time events of uncertainties contains update required any whether or Risk in conference new or by that, the of the recent I XXXX. and our description and Exchange XX-Q list Commission. sensitive our This refer Form periodic to our please Securities quarterly and to the on

Mark Doerr

revenue capital increasing cost sales. over across Pharmacy were can afternoon, associated you, large quarter quarter-to-quarter double revenue $XX.X approximately priorities reducing revenue customer we enterprise. was second prior XXXX, in and and level in in for same Technology continue million, strategic to million the XXXX, good Technology to due second $XXX,XXX quarter, dispensing from at essentially In Pharmacy be XXX% Pharmacy over patterns against Thank revenue second $XX.X the the representing generated year. the quarter Services growth expanding year-over-year. purchasing our of while period representing everyone. in the revenues and part same Pharmacy Retail Caroline, of utilization, period with Technology variable enterprise of the flat the execute Net the MedCenters

progress, As XXXX. million net the a at and into guidance our of least the result we revenue year year, for of visibility of full half year-to-date $XX the are introducing second

are also to XXXX for our new We XX XX year raising XX XX projection new to net full dispensing units. the of units dispensing to net

I’d detail will And initiatives. provide highlights effectiveness on from and to like that will our Now, our the share financial quarter a more Ramona strategic the few then illustrate results of outlook.

with year-to-date XX ended as units. cumulative We increase SpotRx. XX dispensing Net increase and Services XXXX deployments a end and Pharmacy March XX%. Retail at quarter the QX of of a representing units, XX the to from Turning second of X% were XX, XXXX

continue drive being broaden to selecting current with work with their continue strategy they seek clinic of partners networks. leverage to corporate our and as highly our our We to purposefully on growth. build We view profitable our sites as to each in to drive partners we order footprint expansion productive

we matures, and with data the dispensing review goal productivity. routinely optimize to As increase each ramps MedCenter and site

our hub. the to the region, and Tampa leverage key Health to clinic the balance opened Group. clinic We continue MedCenters, Florida, our pharmacy to spoke look pharmacy we sites, We cornerstone which leveraging new Medical forward strategy our driving organic address continued demand and our hub model. of of pharmacy performance our are to a seeing recently which is Cano Central partners we existing expanding hub new IMA from In in

well Additionally, sites satisfaction, SpotRx with we partnership to in impacting prove are with adherence. initially and our clinics has new as value Tampa pleased we at seek additional driving agreed positively deploy for two AdventHealth. to announce proposition, opportunity as provider medication to AdventHealth as a patient

hospital be and with build excited sites. growing to continue with Arizona, campuses a of as connected care partners In be their XX AdventHealth, they are we system pleased with We hundreds our networks. to partnering to are

that has partners has both clinic reiterate novo building ramping strategy would is One novo drive started which Tucson a Arizona, site, expanding panels. revenue and to hubs. been in their as of through our longer primarily are to patient key utilization of de partners We anticipated our in recently de through Phoenix be

result momentum have Additionally, to HonorHealth as summer existing more and recently Phoenix since efforts our proposition partners. seeing working we’ve been strengthen in with of value a to the XXXX our our been market we

encouraged with momentum year this anticipate pharmacy infrastructure. partners but of are sites would continued note leverages hub each over and by yet are additional current We for our will of most by not this contracted these deployed. that our XX currently We dispensing late SpotRx, that sites are be

technology, we’re by our pharmacy progress recent the breadth on technology. our to Turning pharmacy expanding of encouraged

and software to our reminder, we a predictable hardware profitable systems As provide and platform, recurring highly revenue. to and importantly and license is our intended maintenance sell create our which

admitted the Center, to second Health Florida Health and University emergency Gainesville, Springhill, the the Florida. of, happy during Shands the MedCenters that Florida Emergency University Health Health of serving of to in MedAvail Florida are of We MedCenters announce Center are three of University Florida quarter, implemented patients University departments Shands Emergency three Cancer of The Hospital, Kanapaha.

partner, contract to to four While move vary three signing of the implementation months. we from were pleased from timelines the can to MedCenters have partner in approximately

as effectively enterprise, using savings across to Finally, cost the identify expand margins more to costs and reduce gross opportunities. our potential data we are aiming part of

X.X% the achieve a from second able sequential the quarter. to during significantly During basis first we margins, improved gross X.X% were quarter, which on

and focus half back continue we into anticipate margin on was improvements prescription a the Our the team’s core delivery streamlining to of XXXX. contributor expansion, to

year, management efficiency existing of by we internal our our contractors the data and resources. areas and Additionally, this during half increased leveraging patient first research and in reliance reducing technology development center on contact in and by

in strongly to Ramona in growth quarter projected we outlined. the over I and our which of changes, We about these will XXXX to I’ll over and optimistic long-term the on committed to through review now expansion of we With expenses. growth second for burn second strategic continuing profitable provide began while fourth drive rate. previously a maximizing of of expect delivering savings In summary, results. to each to continue executing turn XX% value our the remainder the delivering We financial to our utilization quarter are and shareholders. year the we that, result quarter call priorities reduce have am and believe remain cash opportunities the

Ramona Seabaugh

Mark. you, Thank

months Net services same revenue $XX.X of from the This in was second our period was quarter retail same XXXX three XX, June to a million aided pharmacy $X over the year. increase prior Turning in period in results. XXX% the ended million, increase revenue by for the XXX% a XXXX.

level As part associated can in we have revenue be with purchasing sales. pharmacy patterns technology capital variable indicated past, due in enterprise to quarter-to-quarter from customer large

the ended was XX the at Mark of a deployments XX. increase QX QX Net cumulative QX with XXXX from end X% units, dispensing we of mentioned, net XXXX. XX end XXXX at As

network of payer clinical for in the was quarter clinical are dispensing contribution Gross units compared net X.X% as and As quarter margin meaning a sites second approvals reminder, as managers. XXXX. pharmacy technology we second that staff higher live, such XXXX quarter pharmacy have that sites segment. Consolidated from train from the X.X% board or the account benefited margins the XXXX define the acceptance, to second in

X.X% the gross from quarter of were $XX.X second XX% second in to million the of million, expenses pharmacy second operating XXXX. $XX.X segment XXXX of the quarter Our from quarter margin in XXXX. X.X% XXXX the for improved increase quarter of Total second in a

of equity million loss and placement calculate new exclude growing ended and administrative our of cash growth a compensation executive XXXX and $XX.X loss reflecting compensation net we and with a to back the $XX.X costs XXXX portfolio. second XXXX increased XXXX. severance of increased in quarter MedCenter and second second loss income cash second is expense, depreciation other of amortization, our and equivalent higher operations April. of pharmacy adding pharmacy a and and the compared private selling $X.X result as Our of by million quarter result expenses million which to the We EBITDA, marketing of as deployments. a the Adjusted General due to non-recurring interest in completed in in of of in costs stock-based quarter costs direct quarter and

occurred additional and of on July closing $XX gross in proceeds. our X, second XXXX yielded The placement million

we continue to operational We to needs. sufficient capital have fund current our that believe

for second approximately stock have quarter, of XX.X XX and we million of share outstanding have quarter shares. count the shares we of As to third the common now approximately weighted a average million expect

$XX year million. of as least guidance outlook, Mark are XXXX revenue full our at indicated, net introducing Regarding we

of are our expectation XX increasing as to already initial to this net we XXXX, Additionally, units ahead dispensing dispensing to XX net in units. XX we are range XX of

on Regarding growth focused remain our throughout the balance XXXX. outlook, margin and adjusted our gross margins we improving costs of operating

comments. closing to gross that, Long-term, remains the mid-teens. in we with Mark back X% call on continue gross of turn margins And track margins next progress target within we significant as over have the to target the for Our made four X% already. quarters to I’ll

Mark Doerr

Thank today. questions. you, call for months. to our progress we you now will updating Thank Operator? you joining the look Ramona. up on that, the in open forward coming We to With it

Operator

Cowen. Instructions] your is open. Our Charles you. Charles, with first [Operator Thank Rhyee question line from is

Charles Rhyee

Thanks mentioned the beginning, cutting in bit. I at quarter, missed and just for taking congrats Mark out over was the on and the questions the can you a kind said and of little what phone Ramona. bit Mark, little go then you AdventHealth, you again a

Mark Doerr

Yes, Charles.

put part, by and there. we with was pharmacy Cano then current that the a in up Orlando. being agreement Health sites We driven We one opened pharmacy had in think agreement we We And place. Tampa also I pharmacy, service new Group our like opened AdventHealth. master signed about over hub talking up and in clients a right? IMA I Tampa

with We about care. implement XX care a system one sites is of them, two health of clinics also pavilions They’ve they’re there. already. and which large And signed got live to very XXX

us another area. the So for in Tampa, represents partner scalable Orlando

Charles Rhyee

in into opportunity Or Got now? put well? is right just there the it. this as the with really And be Advent, to used is their MedCenter hospitals an clinics also to

Mark Doerr

now, starting clinics. the we’re with Right

I to point. SpotRx partnership this got a and really could organization, within we’re the at think the clinic there other to we’ve focus implementations but on lead opportunities going nice it going

Charles Rhyee

the have. second increasing are here that the the revenue. If outperformed, early run makes so obviously, productivity about Hey, on at that certainly the as dispensing would $XX of quarter if guide you think kind that just greater take up. million. be million you you at rate that number least imagine the take quarter, run are you’re million. ramping can sites because the increase Anything of I unit might guidance $XX you we the That think just rate $XX that, in introduced about would sites of on the why Anything and also be here provide here Okay. we ones set improving you here the I to guide, sense. second the

Mark Doerr

Yes.

$XX the how rate, get believe confident site. network we think, the to feel to on continue we I a on focus And with we million, organic new continue but going the productivity up, the about the on do run balance and that learn right continuing that. productivity I to we’re to in

Charles Rhyee

margins, the the bit faster. It Okay. about probably digits is year where Where see quarters be by you’d should we obviously breaking high that would by the And little guys on something to see had Can previous obviously a double in we’ve that to I end. then talked here there getting margins year gotten year want further – end? end? you by gross out. kind looks of digits you like single think Or

Mark Doerr

the large to to grow for sort contracts little that by expand margins. of some we’ve Charles, faster. do being a done limited margin, current of We the able I opportunity think maximize agreements always gross inside part looking is and have work renegotiate we to more what bit in those

year like to certainly we’re if with think but So it with would to the we’re know accelerate going like to you’d that of the right guidance if the the I and anything point. And stick I X% going to now. X% possible, Ramona, to the you hit guide by don’t end to stick

Ramona Seabaugh

you I No, everything said. with concur just

Charles Rhyee

was? burn sort All Can on of reduce the the quarter right. to last Great. the in And question remind last the burn. year is efforts us what my fourth – cash you cash of

Mark Doerr

that? Ramona, to do want you

Ramona Seabaugh

on Yes. cash as year this least burn by million, that remains in expect, And cash QX about was we we reduce XX% said I $XX to track. burn The at believe. by and QX that

Charles Rhyee

flow would to And year, then saving that next is expect, or next largely we cost more initiatives would you revenues cash improve year as think expect to fair as into of that continue decline burn it well? to

Ramona Seabaugh

I think both.

gross expanding I our the think will we margin continue margin, costs, improving on brings. to that and improving revenue operating focus our

those So of the both cash contribute to of reduction the then burn.

Charles Rhyee

Got it.

for The deployment clients the new it last is your signing me. dispensing increase that conversion sorry, driving here? one one Advent accelerating what’s of existing Is their guide, like in plans. And that? pipeline Or just clients an unit

Mark Doerr

it’s from can And in And believe Yes, we’re Charles. helping announce what able then similarly units qualified happy dispensing XX. to the standpoint said, net we’ve up also other partners our a it’s both XX of, talked sort pipeline to really the new of new that seeing guidance from we’re that strong we drive I say would with Ramona and a I really being being that to on. demand got there. That’s growth Arizona scalable. the about we there’s to our AdventHealth. partners driver bring on We the

Charles Rhyee

again. Great. I Congrats, comments. appreciate the all

Mark Doerr

for Thanks questions. the

Operator

Brooks, Our next O’Neil from question your is with Lake Markets. Street is Brooks Capital open. line

Brooks O’Neil

give have they you in I Good could of, of I seeing growth. off, just of terms I what don’t Thank a seeing your are start us a too. to call much. you few like maybe you bit I’d same clients are color strong, large unit might know, guess it afternoon. very questions little

could the you experience your be large whatever having about existing clients Just are would great. say

Mark Doerr

over to that’s the this Yes. question. would say, mostly call I I – seen of the good year. and first return we’re of visits happened the Brooks, sort patient demand think pre-COVID I what the half we’ve would demand,

to So what it’s call I I back think relatively pre-COVID.

conversion, metrics our I you’re rates, our and growth. we’re certainly what it’s seeing in strong and prescription what in think our revenue playing the remains out it in seeing from patient in

Brooks O’Neil

delivery or in there return is you that as normal to demand say still well? good the delivery trend Yes. home for of off Is would the Great. fallen pretty with clinics? home the And

Mark Doerr

mean, is think I for the Yes. I convenience there. demand still

We is are and an we optimize the seeing, And and dispensing talk to there. seeing focuses it’s productivity about are MedCenter one of at improvement our we MedCenters.

opportunity as the and released on margin. haven’t expanding a We gross that of way on clear the that focus continue to it, but any stats we’re that’s part we

the as to home that’s contributor So MedCenter a more expansion. margin use delivery that we than see

Brooks O’Neil

Yes.

would bit about well? Are say California as talked Arizona. good. you’re Texas then and and – a and Florida success having Michigan in you Okay, And quite you

Mark Doerr

Yes.

target operating us. So Texas. in for a not state we’re It is

of we before about have under from board waiver. have current I a other customers markets. demand stated two markets and potentially When regulations. we Illinois pharmacy As do mention, we’re the are open there. we both demand favorable And didn’t we California, Texas think and that those Michigan, seeing a Michigan of working in

So limitations there that are some waiver right on now.

Michigan, continue but in the And build that We continue the rules to expanding. sites. we to We’ve pharmacies then working hub partners the are utilization with in focus with area. are we promulgate are that actively in and organically around on increase three seeing got it, board business to there we California,

Brooks O’Neil

tech could all pipeline I you’re opportunity? still Is things? business at And understand interest Great. there is seeing that side but lumpy, in that pharmacy you comment in about of that the

Mark Doerr

– integration around Yes. Epic and a talked the in calls we’re… previous really We’ve

Brooks O’Neil

Yes.

Mark Doerr

are team there challenges addresses new because pipeline place. in seeing And inbound out sales are some increased put to additional Pharmacy somewhat pipeline. that with technology. App their wages. again, sort complete partner In MedCenter well of our year. without the finishing integration and the for patient That end first to it have helping integration really the as of integration we of increasing intend building off Like shortage the flat The we’re McKesson represents Orchard, will intend for we that interest be in labor. said, that call the build a our XXXX And type that a done as way economical of now an needing we increased by the with still as of technology labor this of integration satisfaction year what today well sales is Tech, as the we with us access

Brooks O’Neil

making. thanks all great. That’s progress the congratulations Well, the color and for on you’re

Mark Doerr

Thanks, Brooks. appreciate it. Really

Ramona Seabaugh

Thanks, Brooks.

Operator

questions. There further At questions. [Operator this time, no are further there are no Instructions]

to back I’d for any closing the remarks. conference management pass like team So to the

Mark Doerr

want you Thank Just evening, want thank to care. joining to everyone take us I and this you. for

Operator

for That your participation. concludes today’s Thank call. you

disconnect now lines. your may You

MedAvail (MDVLQ) 12 Aug 222022 Q2 Earnings call transcript