MTBC - Earnings call transcript Q2 2018

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the MTBC Second Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Shruti Patel, General Counsel. Please go ahead.

Shruti Patel

Allison. you, Thank everyone. Good morning, the MTBC Conference to Second XXXX Call. Welcome Quarter A. are On Executive Founder Director; Mahmud and call Officer Executive a Chief our our Haq, today’s Snyder, Chairman; and Stephen our Hadi Chief Chaudhry, and our Bill Financial President; Officer. Korn,

including of and forward-looking made Before Securities the that including expectations statements as in details you statements XXXX Securities XXXX of this financial are growth, growth historical fact, Orion any statements Act made during to of of for Exchange closing acquisitions and meaning guidance amended, call certain within limitation conference conference and of we the statements, other our I discussion Section this call Section All regarding regarding begin, outlook the acquisition are other performance, opportunities. expected like organic business statements, the forward-looking remind Act statements operational and XXE future would of during without XXA amended. as of potential and and than

statements anticipate, upcoming, identified Forward-looking plan, the or terminology similar may, estimate, negative with as and will, may words these believe, expect, terms. such be of sometimes

Commission, to find of reflect comprehensive with risks our the and statements opinions statements. events. are could uncertainties, in differ promises our are filed release of of refer and guarantees performance factors presentation press many of forward-looking our of are from results of those contemplated undertake we differ Exchange to and actual actual this to no new information forward-looking from obligation date Forward-looking materially these and Please discussion statements. where subject which variety statements a only or a future of these cause light forward-looking performance or revise will and materially which statements could reports control, that more you Securities These beyond our to to our future cause not and results the these in as

measures. performance of these may With I second over Please Officer non-GAAP we Chief GAAP results of release results. our refer will refer to to to XXXX call press Stephen financial turn non-GAAP announcing our measures certain the Executive Snyder. said, today’s to now reconciliation Steve. MTBC, the call quarter today’s on that financial Finally, a for

Stephen Snyder

Shruti. everyone on second quarter for you And you, Thank thank us earnings our call. joining XXXX

pleased are growth. million, of another $X.X second for a were XX%. report We year-over-year of increase to strong revenue quarter quarter Revenues the

record During and second achieving also continue generate flow the adjusted to we GAAP positive income quarter, cash EBITDA. net while

large integration EBITDA closed was XXXX. Our million, in of than the by more driven MediGain $X.X adjusted acquisition our successful year-over-year part representing which growth, XXX% late in

Our $X.X GAAP $XXX,XXX improvement reflecting the of net million. year-over-year during income a quarter, second was

our the While had will doubling half assets $XX we the we've the acquisition guidance having providing nearly closed revenue half revenues. represents record of purchased we for of a stronger. the which to Orion million million, annualized of Corp and Health half of are year $XX largest related year year, Having second even of entities. recently second our first of date, the to business core a breaking believe be the Today,

representing $X full scaling without ramp related As approximately and we cost, in business Therefore XXXX EBITDA. we between still a significantly up be expenses. our and growth, adjusted we increase million redundancy acquisition $X with accelerate EBITDA Xx are expect overhead our temporary XXXX even revenue our our adjusted to corresponding year million,

also Revenue revenue the multiple the opens Management Orion selling provide traditional Cycle services cross each of opportunities and acquisition the new In type other addition RCM to which we throughout up physicians to or segments, potential. present country, of growth

of innovative solution servicing our client the offerings. beyond hospital community RCM acquired newly our historical involves scope First, agreement

effectively assist our addressing now site insurance at patients For and in needs. community eligibility we work who and employees acquisition with to have related example, the hospitals on their Orion customers

Our employees unique also RCM the customers. and hospital consulting to solutions provide

thousands to Purchasing in negotiated service And industry vaccines the during Group include MTBC also of which health We new to enables become records. from making which MTBC's as GPO available GPO companies new clients full known Organization rates. to look our our this suite services our of with introduce course our leading throughout is physicians' members pharmaceutical discounted forward all of quarter electronic the and has valuable of RCM purchase this third to of Second, customers GPO the year. which customers segment we'll country who GPO

Illinois. management practices acquired newly terms pediatric provide XXXX. our agreements Services active extend through Ohio which these contain Management and We services Practice year through that segment in service revenue management of Finally, involves our XX

part We now turn the will floor expansion as of leverage analyze segment. together this these with existing organic management growth market us and opportunities join employees acquisition in Chaudhry. to acquisitive I'll Hadi Hadi? to services for President possible to this A our our practices experience over

Hadi Chaudhry

joining call. us second our for everyone you quarter thank And Steve. on you, Thank XXXX

work a the than XX since closed we Orion that transaction, offshore to estimated so, of vendors are transitioned RCM less XX%, already been has service. days the offshore Orion's the have reduced our our it laying to significant While an doing we from By have back-office we improvement report pleased the by foundation level in costs we for by employees.

add our software clients to and our we proprietary opportunities analyzing who relationship have to transitioned platform. were to all other using by platform value Additionally, successfully are Orion's leveraging

to blockchain, that of are we efficient secure While platform. acquisition, the comprehensive patient electronic about we it regard and very discussed through growth calls, excited support Orion to a pleased during of our With exchange our data past the earnings we will are blockchain. have equally network the as about vision create is

the EHR to second that move we pleased data between during portal. quarter blockchain We production into report are patient our for transmission and

small this blockchain. recently partnering will and connecting will York also from us a have We include EHR New to based obtained a with commitment partnership that our

leader. our strive we technology leverage important solidify are as While we believe blockchain market these small to milestones to early achievements, a as and are they position

and powerful, driven built-in intelligence the needs clients last the with functionality our in to our in serve of talk relationships Allison, interconnected artificial other we better increasingly virtual EHR. space. the assistant new healthcare Forge also Since call, earnings vendors released

an the physician takes to using and complete. By For steps assistance Allison should expand. office over traditional with assistant sign EHR and pharmacy. the example, has and a often Ellison virtual This an continuum minutes a task of continue only that of need in new visit patient's necessary be then to type This the sent fields provides HER, our simple scope the now prescription to the Bill? assistance we a move the seconds, look is Trans patient's updates we up physicians forward. users say re-prescribe quarter exciting been which to contrast and a to throughout forward Officer, to will medication the prescription providing floor I typically in the many for turn during Bill renew talk Korn. the off Financial physician Chief to and populates to active all five as care

Bill Korn

you, Hadi. Thank

what year. compared to closed quarter acquisition, Orion adopted $X.X X% to or increase AFCXXX XXXX. of on largest Please did any January MTBC XXXX. the Second Xst, is on revenue for balance reporting last compared Revenue closing have from the under recognition for record And impact Xst. not revenue. started Revenue XX-Q this include million sheet new would $X.X recognition on increased revenue recognition MTBC. reported same quarter based remarkable we our the ever were Xst. which July or release quarter refer a a strong revenue strong table on showing was the XXXX XXXX standard period XXXX material our a our QX, which Revenues and second for We strong old revenue standard, new not and standard. an our growth, XXXX reported $XXX,XXX earnings on XX% did have acquisition the profitability, to in July for revenue very million,

our in $X.X second was net significant savings of GAAP income million And loss quarter $X.X improvement of $XXX,XXX quarter XXXX. acquired improvement of was $XX,XXX or in October in of net of the X.X% in result $X.X an $XXX,XXX second first cross a income of net we increase since income million from an of to MediGain million revenue, XXXX. XXXX. of net compared of GAAP quarter Our a

from While total year, GAAP income to quarter to expenses turnaround Dramatic revenue $XXX,XXX net from $XXX,XXX. factors. by by the prior $X.X a due decreased million was operating second increased loss of $XXX,XXX of net GAAP four

in as a where First, XXX who the an client revenue from majority $XXX,XXX last provider signed comes we increase therapy November. the physical the new increase practice of

our by in a Second, than cost to additional costs first operating nine October the more after or which indirect months X% which cost revenue includes $XXX,XXX acquisition reductions in the were service XXXX. an MediGain offset additional reduction of

completed divided value our net expenses of purchased attributable of is same new average is of our income GAAP and as why for net year. administrative net always as weighted to per net and using outstanding. common was GAAP $XXX,XXX calculated general the attributable GAAP increase to depreciation was income adjusted stock Non-GAAP of the positive This or quarter Third, assets first compared period paid common second share based quarter income our the income shareholders. an of per $X.XX $XXX,XXX Non-GAAP of though the $XXX,XXX. period and amortizing income or reduction of reduction from $X.X the the and net end intangible outstanding. loss positive. intangible net approximately XXXX there's expenses net any before net in always of $XXX,XXX amortization preferred as income income. integration loss even was compared the acquisitions. which per GAAP or adjusted per net non-cash standard the common income such calculated million $X.X the adjusted shareholders quarter of a and net excludes dividends consecutive to the to expense, dividends costs transaction net was an of last in million, an to revenues share share That's we in of by And $XXX,XXX loss of $X.XX $XX,XXX negative quarter Impact shares acquisitions. of of subtracts GAAP third effects shareholders for adjusted adjusted common and of based share loss XXXX. amortization The income $XXX,XXX $XXX,XXX number our calculated significant increase net well XX% associated net is income Non-GAAP on expenses, the on finally second is compensation as revenue assets; shares XXXX XXXX using loss of with

XXXX. in GAAP second third million income XXXX This is XXXX. GAAP for adjusted company's our operating was GAAP $XX,XXX operating million $X.X Non-GAAP of with quarter the which income XX% of the in improvement second from Our income of million revenue. positive since or an IPO operating revenue, quarter $X.X represents operating $X.X was X% loss quarter

Second period income our quarter non-GAAP size. million XXXX for at such income of quarter in income second good adjusted $XXX,XXX for closely adjusted milestone $X.X consecutive from generated compared prior the adjusted X% a is by the cash was from XXXX quarter improvement as proxy income. same adjusted million operations a income second and adjusted Adjusted operating is of fifth improvement revenue MTBC quarter for $X.X was also of EBITDA business. of $XXX,XXX of quarter XX% in positive the from represents measuring operating quarter revenue flow Cash $X.X our the especially year. important Achieving or EBITDA a our as operating to adjusted non-GAAP XX% for company of Management actually This looks last million. an or of metrics XXXX. operating $XXX,XXX an operating

annual our growth XX% quarter basis, savings EBITDA we've as XXXX from of well improvement $XXX,XXX prior adjusted on quarter, the $XXX,XXX for as significant represents EBITDA achieved. in the reflecting an XXX% Second adjusted an cost growth

we EBITDA spread quarter a This and the over of ever revenue Second MTBC consecutive EBITDA. our larger The quarter EBITDA MediGain our adjusted before. adjusted base is expenses acquisition the that achieved allowed ever fifth recorded. have we us fixed adjusted highest represents generate that positive higher to from larger scale has has

$XXX,XXX the Orion the by our of similar net reflects million $XXX,XXX in that in expect future. liability; $XX,XXX difference EBITDA and $XXX,XXX adjusted non-cash The gain. provision have the GAAP $X.X for and acquisition net amortization XXXX acquisitions; expense, exchange offset between depreciation based in effect and income expense; $XX,XXX costs We $XX,XXX second will a $XXX,XXX interest related of of compensation; increase stock and integration to of and consideration a foreign of contingent transaction quarter of taxes

X% XXXX period of first little increase last Let's Revenues talk compared the million, a results. same of our an half to $XX about were for in year. six-month $XX the million

income net XX.X% last depreciation a per $X.X $XXX,XXX same less the Non-GAAP the income million compared adjusted of of $XXX,XXX in for of million for of during outstanding. to net first end-of-period as year. compared last of well and six year. calculated $X.X flow or income net year. costs. of for to revenue, GAAP net GAAP adjusted period includes direct using EBITDA XXXX, was million million half which $X.X adjusted a the XXXX adjusted was additional XXXX of of the same was operating improvement XXXX last in an six first increase negative the was was compared months expense $X net loss year. of million $X.X the non-cash $XXX,XXX, $XXX,XXX of half share, and to first of common over net half in The million, GAAP revenue, same amortization X% XXXX of $X.XX $XXX,XXX period months, last period was the operations Adjusted $X.X from than Non-GAAP $X.X million, reduction the as shares of revenue income of an Cash $X.X million, EBITDA or of income the

shares for used had initiatives, acquisitions through As where a a growth Valley including SVB of as Company revolving the to its key stock affiliates advantage A and in us Corp non MTBC capital June did facility a opportunity was a by of rate Health convertible compelling early Having from Series $XX.X available approximately for businesses of of in additional based preferred of on market. take Orion in an are enabling to has key revenue half purchase approval. of credit attrition $X consolidation Silicon positioned attractive Bank enabling for April the not XX of to line transaction be credit secured people margins line in our business, in expanding agreement. capital $X.X Company can with the overhead, us investing price corresponding us to grow an our with utilize revenues XXX% SVB’s XX, surplus repeatable enable Orion without significantly class increase million during future annualized of technology $XX.X and of The million. and Raising us help a provide will We $XX.X first The the defined XXXX. world service. while scale sale million. cash and a that The adjusted in our factor borrowings million working of XXXX, million

XXXX. nearly will of MTBC’s second revenue Orion that expect double We during the half

You at although our will be the to our $XX million double be end can half to revenue of expect million our half the second total year of of rate. This for run revenue full million much first in higher $XX $XX the XXXX million, close XXXX. means we $XX range will to year a revenue to a

U.S.-based third-party to and enable us our will past for reduce with on Orion’s As portion cycle contractors. team acquisitions, offshore dependence we experienced to revenue leveraging business, of the be management members,

moving expensive did assume facilities, we less not to Orion’s smaller, of most leases. We will since be

our We will profitability, improve but improve technology before will full These quarters take impact will service for occurs. several begin utilizing clients. to the all

will does our positive the This Please half savings million next of Orion’s showed excluded but will over net to a grow Hence, and is expect $X quarters. the will that profits group expense assets, organization business this amortization you value impact. and second EBITDA we reduced EBITDA accounting between first income few the operating will can our an the previous the half, amortize temporary not resulting from This intangible to adjusted these for means RCM perspective, acquisitions, However, and This attributed to our already our adjusted be be years. will of losses to full-year we we increase. while note adjusted overall in which XXXX our business the impact that similar practice are in million. profitable, a next any few net an of $X flow. management EBITDA, new large like offset be purchasing cost from GAAP loss in expect cash businesses so GAAP portion quarter from that have non-cash the

and our Executive can his our remarks. adjusted Chairman EBITDA concluding and I'll expect as our and over we overhead revenue, the in GAAP Haq, to spread continue costs you across reduce net return grow. positive fixed income our Mahmud However, larger XXXX, to grow will now turn will for to continue floor

Mahmud Haq

first in remarkable the customers, their of to updates forward thank a record-breaking had investors, We the profitability. providing employees We and look Bill. additional Orion turn progresses. as support growth we to of year you, year our acquisition ready and and are half a Thank for continued with year

now call question. will We to the open Operator?

Operator

[Operator from Our go with HC Instructions] Kevin ahead. Please Wainwright. Dede come will question first today

Kevin Dede

And or some expectations maybe seasonality? of given that in seasonality how And the gentlemen. Orion view should onion insight Thanks and RCM call. and new higher results businesses your half. some taking fourth see the Maybe a got you for terms business. from layers, couple and of quarter? your And consolidated I've to to that Good reflect RCM XX would us Could then we morning, just of questions back legacy amortization second XX on compound business? expect for margin you my profitability list layer how how less the maybe a peel of you third in your start your of you. with retract inherent that your on give for

Bill Korn

questions. Thanks Kevin. Good

I for you. see can me do Let what

as terms folks in has seasonality. in little business our first a seasonality, of know general So many

but typically insurance Many and year are quarter slower. You the to fee our have in deductibles the during most of payments don't year. differently think clients bit a doctor the little therefore people related we're And actually of doctor's getting their to a that's payment the people that the of the in across first going collects.

revenue typically quarters. segments. other than little first is look In slower at of each the bit So Orion, let's in three quarter a the our case of the

look QX all their will similar management QX. be cycle ours. QX, will to business similar very So And therefore revenue roughly to

several So fixed. fees nothing got that more particularly major are there. where clients hospital There are essentially we've

see but little tends the a actually case are to seasonal probably So typical guess the the less their seasonality pattern fact three bit enough a for visits. the going notice. to that in of is of there's not preschool pediatric as increase practices, in I somewhat children In QX

August September bit a So revenue. early increase and little typically an there's of in

may bigger, bit you a that's So but purchasing I QX the to little see guess organization, one finally other difference, about. think with not doctors --we again dramatic group And a have a then the who on rebate based from that quarterly get and vaccines a participants. They currently X,XXX on vaccines are purchased. directly basis we are doctors buy pharmaceuticals major check factor

vaccines $XX then And essentially sort most likely would given vaccine that Overall, third think So is the there's that acquisition, seasonality we've as look a an people portion to million guidance somewhat then quarter that $XX to in things the flu vaccines. have first find get to that and in we -- higher that of as more generally good And been we've return little probably acquisition a quarter most little catch .I revenue. the being there's up bit because on vaccines, we million before of to two wasn't is tend those our children vaccinated bit quarter. Most quarter to completed year. at way those tend Typically quarters similar. second they that business effectively should this pulled over. took the likely that half previously, again first to this early then before third Very childhood bit bit that get when be some is little during of look a at and processed for little flu a in quarter done after we flu in of a often vaccines work fourth but few second be of school. a likely more to need I

there's a a seasonality little might think big in not QX bigger but about being QX of a general you lot I than whole there. think So

Kevin Dede

the Orion --I I contracts established Okay, much know some about appreciate already on thanks of and been bit wondering working you're Orion's margin Bill. on I through transferred. of of that a missed profile? had I'm How just the how side, Hadi's color. the little its probably RCM discussion that

said on as and is, I he is XX%. now system just the work think XXX% your I impact there but through margin lost I'm or far half? how second that the wondering gotten we a apologies, you've what

Bill Korn

we we case and terms do work started these that subcontractors foremost that after great as an was employees is of what in doing first a transferred, as we from Orion, uniformly So and what's done from interesting typically acquisition by as was this with subcontractors in were of being job. customers, well heard

so positive as clients all clients. we about our that talk to we from reception very got making transition And a

developed. And odd so by subcontractor there were XX that I think clients, Hadi now if I'm a were -- correct had moved platform this that actually on clients we've said that

I that think that we've correct? moved all is

Hadi Chaudhry

That is correct.

is parts one Bill offshore two RCM has transitioned employees. vendor the of works work it, mentioned, MTBC's completely been Kevin, So to that as

back-office it of terms comes able just -- uniform feedback platform that feedback Orion a of we started that itself we So which cost from When the cost. platform. have-- in the will cost be --the we of XX% own terms related platform, with to was the save proprietary part which RCM in their platform of the of that quality good first not so the

transition since in software also that then acquired we accomplished that platform So have -- Orion. IT the that XXX% of is this

of the platform in base the that For hospital the big small a supported software been is large have clients though that platform, rest hospital-based which or terms different a there the number overall of of using the are because number client platform. the

overall by the we technology at providing we have --as our to different looking we increase small efficiency can have modules opportunities are use in we the started past, there. So those bridge of gaps the done to where some

Kevin Dede

Hadi. Okay,

transferred RCM had all how then that it most proprietary but the of understand business Orion's that I and so over large that been platform been overall platform has to represents Orion right, MTBC over. rest apologize, all of you interrupt business. offshore transferred of the all as --the just transferred the physician MTBC's customers And estimate serves or of client, stuff these RCM me has I much would Let

Hadi Chaudhry

Okay.

terms roughly in large from if the the the talking physicians, because would of we platform, I the you based from is you're number be rest hospital the the It's the XX% IT revenue, coming have The the revenue at that If look hospital-- which platforms Hospital back transitioned. the from one as mentioned about perspective. groups. there is large from

systems course those but sure of So for based of by bring our we improvements lot the and we transition staff. their and leveraging technology are our hospital can IT --the so efficiency more cannot platforms,

Kevin Dede

mind the things. purchasing would I'm doesn't a your commenting GPO the MediGain, management strategic closing and umbrella keep might might chance that strategy? there that two, perhaps up made have of to the taken decision your you've roughly fully to sell and guess fit MTBC to a necessarily of and still it? business it you vision? are business the are you Hadi. a what since Thanks, that competency it evaluated you roll great. And the Steve or core final physician guess considering extent business decide I you within --I Orion just wondering in I you still your primarily couple months on One, it's to Okay, guess RCM sort XX you dive in

Stephen Snyder

MSA we of the question, fits. And the of With happy your both only the Kevin. for to, So with long-term the those regards thanks groups, we'll and believe also last good question that to the be we physician management, first. have address those our GPO, pediatric part

maintain you continue of part in vendors consider relationships as any the work a that transaction particular, we until serial consider number Our they And we an or our for your be regard time the mechanic us the customer that even with have website. if the up basis growth any when auto just overall a of of GPO to you them GPO or work local day to close with or the with current as of didn't the vendor. day example your plan is them. With of portfolio restaurant to fact to for just on opportunities both whether

probably a website number relatively I a think product. there's small promote to aren't even that their leveraging

to significant So GPO opportunity GPO our we existing solution serious real care pediatric about our think existing actually and with that primary to get selling to can and add groups, into regard base. like. the marketing begin there's to value existing our really The providers

time EHR, MTBC's same and or clients the MTBC's the PM. them GPO solution the itself at While offering GPO taking

a models that the earlier So for and not in solutions. of the competition that great when of business of we the are fact fit part the acquisition mix think excited it's terms in to strategic asked move well equipped really even our opportunities. you And are question we look the Two of having to now to profitability. as having GPO that growth years at that this or continues market direction --the

companies into able be opportunity and to fragmented relationships. customer to organically new to turn to to this highly market at that to continue a operating distress we to relationships, companies see are profitable loss relationships. that a significant value add to real So be be grow acquire able to able relationships those those develop relationships And through to referrals,

revenues that think is cost Orion about So MediGain And MediGain. acquisition of revenue XX% annualized strategy roughly we was our -XX% for for if acquiring costs the than that that customer acquisition, was think the the part. about overall to we that. in acquisitive of growth if most the significantly cost about the less aspect think question, attractive we think we your continue to And

our think We organic growth, to least a scope acquiring look that believe that those over in we We cost we relationships. we way the for breadth companies top-line statement of with --we and strengths. for once think accurate there another revenue an competitors their know benchmark integrate these is that really acquiring very acquiring our costs one we the is this not think expand as space. compare company in associated in that has a those this pretty about to efficient and versus at margins a time as costs it's our experience we I team, really of it's So be typical customer at for relationships. And able grow acquiring consider well so space relationships fact successfully time the that it's to about and that whom

So has capabilities. the that we experience, the team that has have

have industry-leading We platform. the

are turned technology and take us of acquisition the about allows the be model have relationships. growth overall our struggling We that to them to continue with our together customer excited into very we aspect profit companies struggling And global strategy. the that generating business relationships,

Kevin Dede

Okay say what's would the and backdrop, look term? longer near how term Steve, with pipeline you versus appetite your

Stephen Snyder

terms And on and the that and report primary of the and of earlier pleased as to any of near-term, ramped again, relationships work vendor. as what to in in eliminate believe we're XXXX record going the similar XXXX those the And of as point leveraging to as expenses, EBITDA EBITDA to associated in to taking think and up time service of redundancy for be third compare This we the terms rate with we're expenses year reduce in acquisition that think Notwithstanding the last year. focus what of that over work we'll to will lot we'll at I believe do lot and be that increase pleased Reducing them during really But talk the the we like. to is XXXX, as spite the perspective, our able anticipate And an we quality to at about of us and quarter continue our a from The team. Islamabad of a current costs we the a with party able we by XXXX. in of to allowed being to able quarter. expanding of last again in the growth as this software think period in Orion quarter, acquisition in-house. margins. we're adjusted provide be during think focus We'll certainly has of been full really the twice expenses of vendor time. about XXXX as say candidly we're year achieve the EBITDA lease ramped large bankruptcy I able about --what EBITDA year for part year. parallel all the trend all guidance and third we take on getting that during being our the broader of then equipment that planned the expenses we facility a think significantly running we can early be where to the team we we've provided fourth adjusted up first

One so back your business. from the regard out from is acquisition there we to of get question, highly third and quarter to the to quarter, there acquire to regard would last back perspective continue we be conservative next team, book But allow our our for revenues. investors that be this on So a lot in tend the of to and though to confident I we space, particular with the guidance. questions year forward-looking quarter in to we'd similar management At there other this very able in this upon guidance were a first fourth opportunities anticipate think if our to of thing reluctance we focus any we us also really did year, be able confident primary what our we'd with point identifying to but regards real provide to are to believe of significantly like. base even expectations, with for time, we say will conversations, were that looking to industry, expressed outperform be relatively of XXXX and companies the then margins fragmented of specific we to our increase really knowledge were would pipeline, full expanding integrating the as the

are to in so I appropriate confident now right will very the focused and opportunities, do excited at and think assured, the do the that one about we future. next the we'll identifying acquisition time. continue the rest to that on continue But that

Kevin Dede

Thanks to Orion Steve. question the over. detail. deal. $XX.X I'll turn Great, the complete million Bill, for last One the floor

think expect you of September just me quarter cash the what to you'll at balance year? you ended on XX.X, then in fill And in what the You look your the like? the at end June have bank

Bill Korn

acquisition. spent do you say we million Orion to $XX.X as so Kevin, So, the

The --that written first in a escrow held as actually deposit. was check that billion and of was actually June in

collecting to So therefore tapped capital actually there was to line it using the door now credit the intended receivables two to. And on working we out $XX.X back. as million Valley we're revolver Silicon we lines more over clients, that fully the right Xst, weeks went and from On a give July as Xst. our ourselves paid July was were line we that next as

the the some to at as and and third, cash we We're month as repaying. --it's a very by borrowing have starts payroll first do of come a line the as to have then on month to fifth cover. as fourth, So then in the

else pay is extraordinary, you we at cash look expenses there operating other well to to you'll So enough sufficient dividends. I there's preferred assuming transactions, flow believe the expenses, XXXX particularly cash are cover that's the as the no nothing have as that all stock as and assuming our that that's see

the Silicon then relationship. what raising by revolver acquisition, the of way extending barring so a year. Again, I'd cash barring the in unforeseen, number. another with, and full the barring the of work is that we'll small interested end But will we will question anything at the money, say that like positive cash be look Valley And can have

gives of I we them of think confidence. been But fact that the plenty able with have firmly the past results acquisitions anything demonstrated So and other people don't together. to out put we've

And us it's it give us. ago, were would makes capability about I again do that that about the we thinking whatever where XX and is thinking where to remarkable So are enough think months we Having think today. we to good be we we of of a major position puts that company. in to to an to in strength. that continue a same a position cash That much make acquisition And terms. expect could negotiate us write better check

Stephen Snyder

part Kevin, AR unique. $X contrast the of transaction we through we that which our also million prior more than is acquired acquisition. of as Well,

one a element that's cash consider to So perspective. from other

Bill Korn

to able the onto Right. the were you bankruptcy, could say, AR To AP. keep hold we'll but we do

Operator

come go question will from Marckx ahead. Brian of Zacks Our Investment next Please Research.

Brian Marckx

guys. morning, good Hi,

gives an think about I Orion guidance $XX closer Can relates you help of double this that previously close And with of be significant about terms than What revenue it's today to kind your to had previous that what million expected? as about to implied you incremental us annualized. today going you confidence double. in it double or that increase? to it is the why

Stephen Snyder

customers actually object of acquisition. we visibility conservative revenue were be wanted we'd for being. comments included Thank in When process, we we object the to And be process course lacked with we that We you like. what assets in Of in that forward looking were would sure earlier which to terms terms sale. to some happy bankruptcy were anticipate we allows our in at anticipated The were to know. unsure And to when the discussing regard the revenue sale. we make look the what bankruptcy of --which discussing to time would customers we the question. in to the what

spoke few had to all interact were as bankruptcy team objections to in-person in roughly lower in those customers an and successful telephone personally opportunity revenue objections and done, We've when us those will executive representing joined. full the expectations asserted have place that with a of process, we the terms real Since acquired helping the calls and be also --since acquired of that meetings assemble overall have fact were we assets. with revenue integrate having to addition opportunity through about gotten visibility very fact, with there fully in the we where And had and was the said the that either in of the having that the We've our companies. customers team. overcome confidence mix also have the that were winning acquired three-quarters in In or relationships. to team time

the And regard which to So of terms with positive with in with providing able half feel customer initially we've were acquire from your that much second and that than the the confident the We very the with point additional is met we've winning confidence guidance had information the in assembled higher assets that a feedback fact visibility to with. year we team. of anticipated. we to

Brian Marckx

And you can MediGain? attrition of terms Thanks. of maybe RCM wasn't in attrition do to an question. next the in of Orion's business, customers customers. rate you It of the the me what has kind RCM to the business give That their in leads with idea of context the rate saw of us --RCM

Stephen Snyder

which through quarters messaged similar MediGain of revenue. In MediGain, and MediGain's the involvement dynamics so about purchased spoke million had or MediGain to the at roughly to worth ability revenue prior retain about the had half. by their five dropped the very point during we four market before we $XX our one

assemble revenue anticipated A base. client still about we number. our the in passed than the and much to million were ability We the distinct their revenue year --as revenue. million. continued we of a fact, $XX half had So spoke to And integrate slide $XX later, as we in possibility a team time and MediGain higher

process revenue. and revenue second in the half year we that acquisition model, of that that and the period guidance those division the needless for degraded those our the So of continue done with way retain The are Orion the they context that of expect realistic. bankruptcy And into expectations. during full were XXXX, the in relationships. to that There to the lion's conservative are spite we're acquisition in we'll on you'd numbers we for the best our be of of exceeded those of we that competitive the to seem baked again before that to revenue second have that over especially being embody fact - to aspects first as quarter the overall very for share guidance to of But get providing places to retain. as say The those all In able stress well. part the again, we've of outperformed for in that believe year we the be in optimistic all and any Orion, anticipate numbers in the time. a of assets that pressures pressures those quality we'll exist regard And able having to of expectations. XXXX. work half we terms provide similar the acquired for a year RCM But

Brian Marckx

that more be then cost-cutting. remarks I kind that can may specifics prepared if give terms in your think degree, to little certain And of of us completed? in the of bit but when you you know you can you a terms covered synergistic a

Stephen Snyder

We'll some of of expense $XXX, be into regard represented happy to. we expense. the which break apart With in regard to per month XXX offshore excess the offshore categories the key with if to it this

indicated, Bill to team vendors to transitioned and we've Hadi that that team. Orion that our work was third-party from As by already leveraged being an is being leveraged

redundancy We that in have terms continued of expense.

works transferred review than itself While we we the providing being that XX%. our all by work. some just team board we've expense, to able on being for the the in been team to believe make our we roughly reduced we're team. really that workflows That that even Hadi we've reduce more foundation by of believe doing and extra other having that significantly transition sure the have expense the actual improving quality. like by been handled the .They're to But prudent able to importantly lay been And mentioned, so have is

leases that about leases the that a copier Orion. burned whole burden different and equipment we of think seller photo things As like variety

equipment during to to We to are transition days. XX obligations. leveraging that the assume probably only didn't going is XX which period We be those

already have So say for variety we'll a right the candidly versus photocopier And we that we've days where to of the candidly month With complete now that. where let's paying we're of process majority by next end And this quarter to stopped for or equipment. significant different equipment using of and be Xx XX within monthly cost are with what hence will that use with a regard in we of Orion And whole during the equipment time. facilities, above that. the was paying That own and initiatives it a have of stopped simply And paying regard of leasing this for stopped it. paying so. the portion X cost-cutting using a -- we're period renegotiating.

of Our legal team renegotiating many leases. those is

of expand facility will during during year, happen the year. then expense the will that half this quarter and the this the fourth leveraging least majority at our all happen second third And reduction So of will team, of but work, margins. improve year retention That also will to we broader us continue that with proceeds. overall help the further us help quality us the assist again as progressively of the and

Operator

Our next the Sutherland Please question of will come Company. from go ahead. Bill Benchmark

Bill Sutherland

morning. deal. on And Hey, Orion kudos the good

as think that kind the curious might look how of had you Just at of strength map talked about you you've fits and where don't I the into how it their potential? with business. play marketing as

Stephen Snyder

we the all we already geography, clients client states. XX base of working Orion That's prior about the a with across think question. from And great to as perspective were

all think of significant leveraging concentration We've all are New --an part states California, well had for in Pennsylvania relationships our Colorado, key Orion in a our in they Jersey. and about those of relationships states clients California active been We significant --we've client New base. very of had have and states these York services. New are in overall we've at the We overall Jersey. XX York, least pretty Today New represent a years presence. aspect as

now a who Colorado both a we account acquisition on-site have we'll help I of within So where will have its can us the one state team think with --we part presence have and management alike. as there team because

new So really grow be those members client Orion. sub really XX From to specialties and have base, we Orion, any that where forward were one in the material to a continue number specialties. working prior leveraging and to team and look to presence a with local than we'll to unique will changed way more Colorado specialty providers perspective, state That hasn't with

those some assist haven't part technology And relationships. very can pathology us and relationships Orion a the obtained we as regard talented now some and in even have transaction we've we really with to of key significant members. specialties, had past But team had but number anesthesia. radiology that However, some of the

excited being growth able in Now in to we develop new leverage specialties with an those the about critical are really on those to relationships mass organic relationships basis, of order relationships

Bill Sutherland

about Interesting. way limited are And a And pediatric more use want the going to Are about played you their groups. I you to of there. definitely it's thinking it's practice expansion kind said as I kind to three just large that in of you you understand learn maybe management before business something business, it that you as fold. mean as to keep

Stephen Snyder

describe a Bill. great that's way to at you look think it exactly I how

groups positive having on providing able helping growth practices a on very acquiring at team a For profitable local explore it's us they those management now more us, to looking our set the similar on work to these day form growth. gives members practice expertise are management the than and opportunities markets be again to credible existing relationships this other servicing one, and onboard XXX and groups, EBITDA to the identify way opportunity be the relationships. Whether an into have possible for the other providers who up in expanding from or team We services. organic perspective who

strategic have with relationships. opportunities right to the stages the more talk term next we'll are regard overall the management certainly overall now practice the and And understanding to of really of in during opportunity. quarters about we that and couple early direction long better So terms

Bill Sutherland

technology. I'm under me. for of one be last as technology? second. another one you've monetization it And talk just current potential should about for developed we away the contracts? that you think How just simply Orion added the value and how Will more Great blockchain about wondering service from

Stephen Snyder

overall don't charging few to in the healthcare there in great think excitement From blockchain That's blockchain. Universal a have perspective an through about but really as the the of to our we discussion a EHR question. who reach beginning lot of overall for there's anticipate portion a in industries about discussion There's to blockchain portion is other the production. us. that as to vendors of industry, were are resources that That's our we Hadi this our out of other like presently are EHR dedicating knowledge we portal vendors connect of going that are live is interest stages We early in Instead mentioned, development to are able and may blockchain. best actually connects excited who are why actually EHRs to being goes those as who our there very live. products have have advantage blockchain. twofold technology, connecting think to We're in the other the patient the that

to vendors, to doing so. with First, the relationship revenue able continue that services not and be goodwill partnerships by connection generate value the to now develop industry through their with provide relationship for to by we also other that connected the blockchain goodwill have being the that hopefully through not EHR where an a But that's management instance them to revenue and overall have only us able leverage we to now to opportunity offering, to share we add assist to vendor cycle blockchain.

ability into relates collaborative to would that blockchain. addition one point blockchain cross be foremost be for to that the is that would the an the in to opportunity the market generate revenue So to us, through entry relationship. hopefully, first sell cross and cooperative, relationships the those and to But

EHRs, simply haven't users significant as just HER, not and extent one HER. the of much it blockchain the operational the any in as real understand small down from it's rolled of itself and larger with MTBC's really gets patients it Secondarily, the our But it's larger. accomplished anything MTBC comes and and perspective one that all regard that relate can when snowball other an to appreciate of large if a all Instead to it EHR and other a the that connecting of value and hill alike. number we like we

but be of more or will connect to desire that least other number health be really a the data at to who and small disputes EHRs to industry be time, healthcare the vendors. medium-sized that for that lacked industry mechanism have we momentum there An we're continue with as to for especially information when who that broadly assistance that at they no for to to money sharing this is hopeful that government point believe gain effective desire we there the solution look an understand the has into interoperable there will in a Here, There's to increasing data. There's vendors need one that. be exchanges. able went good a up

It those out that's But little the they this secure work creating that's our bit has Some of attempted doesn't approach those had sought throughout efficient that were sharing to achieve. of with success, really probably didn't of and to seem that least. a achieve to the data. most that industry have been connection regard assessment for at objectives top-down

as more We'll number our So and connected create more lives smaller becomes that share that hope grassroots something collaboratively able help other when a grows. patient be of is and instead on it the movement and increasingly between actually revenue be individuals comes then network valuable also able by overall of to vendors. medium-sized developing We'll relationships. as these to that's connect, the to each

Bill Sutherland

that then sharing Steve? right a away, is strategy it's take So revenue

Stephen Snyder

revenue hope that And for a cross where to vendors. market for talked with that again, a into is representative cross which be avenue a that provide for established client clients blockchain being of destination. are potential this then And the getting of that us leverage with think to instance cycle about we relationship it's That's good but and another of specifically other then the strategy instance be small quite we something to able but base. we've services And achieve sell example. regard quarters. few is aspect to we Universal to overall Universal revenue model think relationship EHR able to is the EHR EHRs can what vendor blockchain model EHRs Universal a cycle we same management selling is services And EHR That's itself, instead but a part management to our of relationship instead creates not then connection to allows correct. sharing revenue instead the

Operator

next Jay Please of SeeThruEquity. Albany Our question come ahead. go from will

Jay Albany

answered. Congratulations how three to-- taking of results me and for Hey, the the remind could think just I my a at half wanted been And between on about you you mix revenue you segments question. about of guys, --can the thank bit just discuss we of of I maybe the gross my us questions different second margins? remind should hoping many looking little the deal. Orion? have

Bill Korn

Sure.

given bit would half of management. than color I So specific we haven't a but little terms give say at segments between there. guidance cycle of revenue Orion, the in I'll within you Orion's least three came of from mix more the revenue

think going the our going of So if Orion business RCM business. business which to you half to the the when of you're a other half little have year, all to about half over is in this you're roughly their of have second revenue prior

hospitals about pay Sanofi still interesting for The vast actually business going cycle that revenue roughly revenue practices-- revenue clients the whether of So to are they see raw are the but that number revenue management. directly three-quarters do There GPO of model, pediatricians, but the and small, vaccines. clients, cetera. GPO that to of Merck is majority a you're be the number et internist, the very surgeons practices tends thing their independent is

a referral job amount while fee one we've pure a relatively manages her something does as profits. small got else. exactly get employee who her that relationship, essentially part that's we And so So it's as part of of job

a that and discounts pediatricians the leveraging every doctor vaccines. flu give virtually gives with we care our So it's the give as mentioned, truly the again client intriguing base. profit that family here shots but more internist, is we've things thinking of one find stream existing has and primary GPO practitioners about The

X,XXX those hey, able those course may have revenue pretty in those We to potential grow is and say, almost that Medicaid but the payments to from was practices received what in the at about the And it's from think very fraction to looking thing and than we business some The stable. amount for let's it practice it of their the still be them stream. And from had, revenue smaller practices Orion interested. business, was grow I they that going I'm management that's imagine same XXXX sizable. So that that RCM insurance in going the back of RCM of that business the had one was XXXX. interesting is and that's there. doctors XXXX

improving nice, great. there's respects it's Again on revenue The this margin do potential with for some could have think about to in those So interesting stream. stable nothing technology assistants the reduce to isn't I the costs. that as payroll, when physician having well nurses,

we them when with better little terms hand, what can visits. as the patients we of technology we On in bit for those back other help to reminders efficient. Maybe about can we could more do our make bring leveraging them practices, think in a maybe

think it. think we have some have to where but have to it there is exploring --clearly you it. that what leverage some we're we showcase and utilize we at might Yes stable point this nice that actually revenue core opportunities So you that we are how

or there a that. want M&A before Right exactly to to we as now, may be leverage Steve be firm to may first we make ways said, learn to As do. there what decision organic

Operator

Kevin from Wainwright. Please follow-up a go is question next HC of DD ahead. Our

Kevin Dede

or management practice off thanks. decided one of the I to think I business have it? some going decisions they not those I wondering formal question. point or were if P&L? Yes, you just a recognize revenue was made? Jay's whether And at in saw portion that there to of was Bill, just you the is just I reflected discussion guess all piggyback been how mean formally Have that

Bill Korn

Yes, good question, Kevin.

of to through for their gone those as results, we've it analysis providing. of we that before gets and we've fraction only actually worked So through fees step even Grant revenue. make got auditor to to we got the services the a the or And Not recognized all the engaged party had right gone audit third doctors. revenue We to we've everybody is out. it gets Thornton, financials. remitted auctions to started our issuing audit we're with recognition, recognize management the --first prior auditor practice sure the all is comfortable. we the revenue won They're the basically That way the

doctors revenue. doctor is that the the did therefore the work While getting

it of show and vaccines of malpractice. that's reimbursed inventory, insurance of $X.XX dollar right answer. make the total sense wouldn't to of employees our would a that five gets the the the revenue, in that practices about but I it the from wouldn't we doctors a three the our the cost the medical are to then So offices, $X.XX that show if think we'll goes make sense if have of have again remainder as

in all margin. a we profit become but nice costs, So our earn those addition still

Operator

Patel closing turn conference remarks. question-and-answer Ladies the this will now to Shruti over like I'd and session. to back conclude gentlemen, our for

Shruti Patel

quarter thank joining call. everyone Allison. you earnings We you, day. hope And a everybody Thank great second for has our

Operator

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

You lines. may your now disconnect

CareCloud (CCLD) 8 Aug 182018 Q2 Earnings call transcript