PFMT - Earnings call transcript Q1 2022 | Performant Healthcare, Inc.

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Operator

Good day and welcome to the Performant Financial Corp.

First Quarter 2022 Earnings Conference Call. All participants will be in a listen-only mode. [Operator instructions] After today's presentation, there will be an opportunity to ask questions. [Operator instructions] Please also note, this event is being recorded. like the now Richard over would Zubek. I to conference turn to And go Please ahead.

Richard Zubek

Good By for afternoon, have operator. you, Thank everyone. copy quarter results. the first received now, of earnings company's release the XXXX a should you

Vice is Strategy. Simeon If on Relations Rohit Kohl, On call President the website. Im, Lisa Senior available will you and our a be of President Chief Investor and not, today's have of copy Finance portion Executive Ramchandani, Officer;

you remind guidance that of we call. the These from begin, in to Before filings the call, and financial like made the comments our statements risks with materially today's those described SEC. are some described on including to I'd the statements. those Actual during uncertainties, company's differ are results including subject forward-looking may

forward-looking discussed statements forward-looking update to made revised expectations. non-GAAP are not reconciled today directly Also new turn the during or our Im. as any does would to company like call and circumstances table comparable addition, now press all In over release. the to to measures all the undertake the in are statements Lisa? on based call of Lisa attached this measures I GAAP to most financial

Lisa Im

everyone afternoon, you, Rich. for for joining us earnings thank Thank Good call. and you our

Our previously healthcare solid results results we've despite the business in were should limitations of the noted our first discussed. these that quarter remaining can that it potential are indicative be achieve, and some COVID

cement payments Both of the Contract, services. statement awards Region well results as that CMS strong awards provider the as our to first contract. integrity IDIQ leading healthcare approach our we differentiated twins Recovery to addition the as audit are X and reinforce of In performance quarter, wanted HHS OIG. from highlight the

work our first to a healthcare hard As want made quarter for dedication. transformation initiatives other turn in to Simeon things a the who acknowledge Kohl With discuss greater to to detail. over have your I'll organization reality. continued pure-play you and that, Simeon? hard working Thank always, members team and I

Simeon Kohl

quarter of the Lisa. continued our healthcare strongest well Thanks revenues, of first ever five Overall, announced growth implementations, Good quarter the by afternoon, contributions our statements we of we've last reported implemented revenue XX quarters. reported over compared same program we an as $XX.X increase the In year. work, fully past to of period XXXX, first healthcare over some from as XX% the for when from everyone. driven the of million

we we results will term continued restrictions tracking We long are how are against predict and headwinds the currently in and future COVID, of utilization about core growth strategies, rebound excited cannot our though are abate alongside audit and the rates. that sustained strong related fully our near both to the optimistic continue we

the mentioned, contract first from Lisa like two highlight awards I to As would quarter.

for IDIQ is we first Contract last award, the this The given of OIG consulting earnings and medical discussed our review services, call. timing which HHS the on

to country award that X a the by the X The the Texas, vendor currently Recovery south for states be second in award Region filed is It result, the Medicare CMS. X.X under the noted program. as Audit Illinois. and should and part include central Region of encompasses review incumbent a however, central was the protest year XX of

of expect project and audit us follow. play cadence the ramp revenue in better we further Once out. review to potential XXXX understanding before in need EBITDA So years the a we better for This CMS's information is to process can timing to the gain take implementation any we will to let everything action, volume. resolved, help to

Medicare These activities a or to to statement timelines. will the and about providers engage, data more implementing provider new parallel, extensive establish efforts inform we traditional outreach and conduct to must we share are topics connections work. while customer a need new As number of implementing additive of part In joint of new systems agreements with we contractors. and change, region, audit any procedures, operating

As of revenues we review, we next the hope process in commencing and get operationalized and more helpful XXXX to details, provides We hope with this on folks and about contemplate I CMSs eager contract depending currently the in tasks know outcome some these XXXX. for information the anticipated are context steps.

increases the encouraged landscape. this expands our our Medicare and raft additional market differentiated growing the provider further do and and it of believe by expertise supplier honored only this view we are capabilities, validates Not in contract our award. significantly We also US

integrity as establishes a Performant Taken payment together, this believe of provider leading services. we further

and attractive technology do our to Our contract to We will and anticipate award existing by retool is implementations. as remain for necessary hiring and and we to of focused Vice raft in new that Strategy hire continuing said, remain talent targets we to Rohit growth our that will to the our Rohit? challenging a the the that, progresses results our a significant continued discussion we and pace. acknowledge our our particularly our We've recruiting faster and demonstrated be of Finance it hiring as strategies, types plans for by highly are one increase pursue health executing sales within of currently these for remainder innovative market, implementation the financials. our offerings, ease of cadence innovation I'll it record strategy pipelines. being implementation and We the That platform of to on Combined finest new ongoing both sales lines we adapting year on and continues skilled XXXX. to both are at what to coders industry. while With as believe hand over key relates we nurses will focused in the need a the who growth Senior platform with expanding our all product and business pipelines. Overall, momentum President healthcare expanded the Ramchandani, excited

Rohit Ramchandani

Thanks Sim.

which was total XXXX quarter included largest first strong revenues quarter in our a quarter of healthcare history. reported our million, We of Performant. $XX.X million, the of of mentioned, healthcare revenues As $XX.X for first Sim revenues

currently revenues of are also XX are as note We million healthcare north to excited month $XX trailing well. that

sixth the XX, by pause, impacted the Our which total were the of expectations. August that revenues extended back federal loan quarter quarter, for service year, offer This XX, set date, was time pushed been federal April payment which our to marks expire customer with the by The flat last to be care student XXXX, primary within first has services markets our to government. we this customer to to $X.X one consistent outsource compared has continues since but care been million XXXX. the was

although quarter. our there expect was we $X.X recovery not recovery could -- report did total million. based care revenue mentioned spill-over we the de XXXX quarter revenues in on last some to into we revenue XXXX, in non-health first Accordingly be As minimis of the call, acknowledge that first

progress million to zero. loss have XXXX, continue year was to our growth first this number the anticipate the in $X.X period. go As investments to tandem through million as EBITDA of the our in EBITDA management we the in ahead we actually We continued in due Adjusted the of for compared the in impacts challenges continue as quarter revenue eventually with to lower strong to had performance expectation. we With hiring seasonality initiatives. to well EBITDA face, a QX prior $X.X to quarter was expected

but anticipate year, XXXX, an the to representing connection million, auditing new of $X.X in were XXXX will XX% eligibility as CMS in based and of the levels. increases on closer increase of claims based work claims-based contract as the healthy XXXX anticipate increase rest growth mature growth in services deflated the from both increase first As quarter quarter known into Revenue expectation our the our we roughly claim available with on seeing revenues us. that eligibility as growth, of from earlier million healthcare depressed of $XX.X from revenues, million $X.X to up implementations. operating first XXXX, quarter first we to of our the in continued $X.X in opportunities our from eligibility in the than were trend our the We on opportunities look XX% as us. quarter revenues XXXX. first catching services implementations, state maintain continue the to million representing of hiring rest new of expenses well, well for the over front We continued the XXXX for also Within of volume in a the space, being

expenses levels. operating ample quarter million, cash mentioned to recognize healthcare expect While each that to product the quarter, that a development would announced in we usage activity look the first prior us continued the availability larger pursue do different. and may in five another sheet flexibility all and five our our we currently year our within in markets; anticipate first span, seating the XXXX recovery million to from implementations decreases related offset XXXX, balanced which Last addition growth Coming of build we and had specifically, our human into by the increase investment multi-year markets capital, we were of of off expense offerings in the in quarter, product healthcare leave and/or range between on Within of was we trends opportunities. over upon million last to expenses, driven $X organic which operating a to million, of nice quarter by in revolver cash as expected capital lower balance XXXX we the to which year, expenses $X the implementations start in to additional and prior. be primarily $XX.X compared QX $X.X look our I

spend, our themselves. Even ahead opportunities we this has and sorry, anticipate cash sheet look that X award to retain opportunities may for cash rack will in as on beyond needed the potential range to product revolver range Given after some Region increased may been us, the present the expect amend balance contract, that of we and protest this between flexibility tandem of development our further with higher, usage resolved. we organic

and success fare we customer long strong from [ph] and importantly, By quite intact to update. guidance to are year Given greatest goals. We being $X can year. growth the to through about pleased from our in revenues known at are uncertainty scaling we this on from a start tracking $X to some ahead and amend expectations results our goals that market EBITDA believe cautious to in rates, flat achievements until our believe down. from views our operations quarter prudent and but past we and with core the further care of of for world. implementation funnel, ramp said, are that improving all X an pleased via speed currently are the that long-term the will we that That do the us. million We've find leave We uncertainty opportunities do healthcare to continued slightly MCOs remaining while current how growth we macro COVID, towards gain opportunities we in Rack We're with provide be XXXX, the sales the in Region optimistic continuing bolstering working upon, our million committed our COVID focused learned to XXXX more experience our of are acknowledge efforts. and driven utilization revenues we for informed on we by remaining execute QX achieve ever-connected can a $XX stem market by normalcy variant our was and development accounts, utilization $XX term for revenue being additional [indiscernible] remain clarity both to to first XXXX and larger and million encouraged it ahead contract of can of healthcare and very on return in us to timing expectation more our the trends our million

would long-term up intact are remains open the questions? lines Operator, Our very we for the strategy about excited please future. and you

Operator

begin from will now And instructions] the question Street with Markets. session. Lake We Kyle go the ahead. Capital comes Bauser question-and-answer [Operator first Please

Kyle Bauser

congratulations evening, start for and another guidance. quarter. the the everyone. Thanks all Great. Thank Maybe updates Hi you. I'll great with good

healthcare QX from the you've know little strength the trying projects? Can obviously to and and throughout particularly you. cadence So then year? glad new I you trying might strong Did bit things quarter. but was up, down talk QX up a kind any some full throughout the just Thank Are we guidance. year, pick see you, to recently the quarter was you understand provided we bump about this I'm anticipating an implemented of if understand contracts just to back outsized year? to expire cadence. see

Simeon Kohl

results we early seen as from we This utilization do some just year increase rates QX of with a Kyle. last in question. could of were Yeah, kind have our good really pleased -- is QX late execution. some and I QX, and mentioned, think in think the bump good seeing we that I

for year, spoke the way the about of In still year terms back representing same sequential with last the cadence we the the half growth we of you the lot rest smaller first of the where it in a quarter of the I see kind will think amounts. half of see

well you're So I of it what describing terms in you're think expecting.

Kyle Bauser

the it. Got Okay. -- acceleration extent new are of ramping? to should these the kind comfortable we if then, of And any to that expire bigger can sharing offset to you anticipate you're share this year contract contracts

Simeon Kohl

of side. commercial would sort generally have the committed contracts I renewals way not remind contracts have don't our auto any believe we on claims do volumes. particularly Though year. or recurring this the I healthcare work, and larger They're on expiring

necessarily manage expiry contract is So not to. something we

Kyle Bauser

that's that And Maybe little it. bit for terms to limits love is of types over sort like projects, of of limits, just to to point, color Got any question would we around of maybe interactions on a progressing, a so can thoughts types this in -- you've of OIG more maybe Okay. there the I that Sim, are love had, volume kind hear switch volume contract. would contract. how

Simeon Kohl

Sure. Yeah.

early particulars. Kyle us terms too too little much of a insight still to So give for in

purview OIG and essentially they in of we about the of some support we traditional areas all of will a bit has OIG contract. of sorry, where And as at the limits and lens. so fit different from agency a I services it for the we as than contract priority. the CMS with of so HHS this fixed Although see a the is time, last of different key programs reminded you really folks audit a OIG, for their will I'm is they're looking tell of concept contingency think fee terms at our

the are and of in we So the contract operationalizing are underway. efforts well our midst our

in we some I as it really in about operationalize see QX, the So the think opportunity XX, as see in last a contract an possibly as talked it late but XXXX we event. to revenue quarter, this revenue

Kyle Bauser

going kind this in yeah, kind can't I know but these on, typically of Region case then appeal curious I I'm if process what appeal this you And may every I it. I look like if looks Got last X missed about too like. talk just and you much know the what's this, of in the but types is timing but different sorry on of things? process

Simeon Kohl

one have of it's and I give you point context, number to following that color a handicap is very are unchanged. we compete we And hard no, look, review our as region against I same the Region at one worth us allowed that decision differentiators think contract the secure Yeah, of we for CMS's X. scenarios the to right, X of for theme year, competed some aspects protest of to competed here perfectly terms a Region that customary. last noting additional award many same that vendors of all really it's with confident don't proposal that any and that, in but review, to value the remain but this

to But agency to the award finalized. sure get are handicap it's and hard Performant I just So manner work review. But contract its we'll so. next going XX to ultimate is for -- get of I'm an line timing. expedited important sight days going or the kind in the through the Kyle, it of resources call to an I'm the and know CMS sure it's it's try

Kyle Bauser

the Congrats again on I'll No, Well, that jump sense. quarter. back in makes great queue. Great.

Simeon Kohl

Thanks Kyle.

Operator

question Please George Sutton comes go ahead. Craig-Hallum. with next from The

George Sutton

Thank you and nice results.

and to we talk that want some if in wins high activity the forward? wondered your give pipeline? that about Does announcement, to to more better increased the got talking I very encouragement things then you're You've accelerate to? things relative you folks Does So a get your could pipeline does move that sense? OIG to the happens it Just with what and pipeline when your point? rack profile these at get HHS

Simeon Kohl

Yeah, good question.

look, clients that opportunities I the of CMS, visible. And they larger HHS, are always watch commercial these any something So, pretty closely. with pretty think it's

As and with broader us we giving remarks, I providers mentioned contracts, visibility how a they have landscape my with where same in prepared into thing these greater operate, suppliers, etcetera.

those our So all that up create benefits we are can and pick for clients. commercial value

and commercial space. expand any, do broaden visibility capabilities So well these think of your the to into I there our are that extend contributions that point think, I that value quite contracts

the being So story. in it's able tell something leverage sales the to teams definitely that

our think with it pipelines. us I certainly helps

George Sutton

Relative space, that Maine. opportunities a you're you an might large tried kind had to saw about Anthem a mean of what talk integrity lost looking payment in-house for themselves. hospital do probably you They basically the as commercial this Can loss at commercial in to landscape? other and

Simeon Kohl

talking the you trying about PI George? to Are services in house bring

George Sutton

PI. it they're makes Yeah. to start can turned thing have be you of very opportunity ample for researched that player you to their where is do to documented, lot is to when you. a well own for and these And very internal those an sense belief seems winning commercial over are that one deals you're losing well that large our a see market get Obviously

Simeon Kohl

right. Yeah,

conducting look organization, a to parts. process. about, There's a it's manage, moving of think simple not you if So PI how lot a

that's see a it. refer required data Maybe of been deep kind our to having an what and technology with called differentiate a and and I but and approach, incredible department And components difficult the the experts certainly integrity health of we we the skill our mining running comprehensive from the aspects come program plans the sets of arena. subject all bench resources ourselves components of think different deterministic scale some think of some I tackle and unique [indiscernible], the some able support it, of payers technology Performant to it's has of matter that's task. that obviously PI both to technology,

think done still to think when you tackle the need sure smaller timely opportunity to the get of across we're scale. of you think Performant abrasion, the to and mid these a just and what I reviews services with to -- degree CMS multitude be about able example difficult these tiers, you'll one that's that from the without components manner, but see provider doing some ones I make so, healthcare plans of to payment large payers And that task it, of plans some things to it an gives a some loss, do prompt in really plans it's provide the national absolute payment the national an whole on certainly as

George Sutton

great. That's

As are many likely I I at the companies, better see to universe my get on. look goes don't that as year of

So luck…

Simeon Kohl

it. appreciate We

Operator

We have no further questions.

the any turn back management concludes this over closing to conference question-and-answer I'll remarks. our So session. for

Lisa Im

members want growth us past team that spent excited afternoon. Performant this Thank thank we quarter. them our and you, for us for We're this with you've to every bring serve you our to our about clients we their best thank again, at want their want our who for operator. Once time course of very the shareholders to letting support. thank and day We us

Operator

now for attending The Thank concluded. you today's presentation. conference has

You now may disconnect.

Performant Healthcare (PHLT) 10 May 222022 Q1 Earnings call transcript