TOI - Earnings call transcript Q1 2022 | The Oncology Institute, Inc.

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Operator

Good afternoon and welcome to The Oncology Institute's First Quarter 2022 Earnings Conference Call. Today's call is being recorded and we have allocated one hour for prepare marks and Q&A. At this time, I'd like to turn the conference over to Mihir Shah, Chief Financial Officer at TOI. Thank you.

You may begin.

Mihir Shah

thanks XXXX us results. and TOI's discuss everyone, quarter first afternoon, for to joining to Good

website These statements. from detailed our information Before that our and remind SEC, in and obligations no statements S-X conference including results forward-looking except are you actual statement well begin, guidance, XX-Q, could found that statements or these this afternoon's we or at we revise assumptions the forward-looking our press law. to differ our are risks, various statements which Form the and to release, as this cause call would our investors.theoncologyinstitute.com. market opportunities any filings subjected uncertainties will our growth. as as of financial We that on by with be to expectations and all assumptions regarding SEC, undertake future with filed required like update statements. and to These Form materially was the results include These include can registration uncertainties on risks,

in and in afternoon’s information other SEC our and a rationale by as well from in can press for discussions, in certain of today, adjusted measures measures EPS. reference free measures release will non-GAAP use the also different cash information, of as substitute diluted financial our be call non-GAAP adjusted filings. to be limitations measure prepared During our flow including with financial Reconciliations presented may we non-GAAP and our non-GAAP We EBITDA, non description some true or believe this GAAP. business. GAAP companies. considered underlying The GAAP superior of intended as and we using non-GAAP financial the not operational note measures presentation financial to represent each this more found isolation, accordance they results as Please accurately be the that to of or used and performance of our information is

Brad CEO, is the Joining me today, Hively. on our call

Following questions. Brad. open turn the call will your over the to prepared for I’ll that call With remarks we the

Brad Hively

enhance to announced to and In brings more Mihir Thanks, Chief Operating and the TOI and promotions, Virnich our the support from growth to And Dr. of team. To both continue on welcome payor in joined side. Mihir. the the the President than role. first Dr. to we years quarter. experience provider healthcare XX April leadership March, our Matt team two expansion, the role and we Miller Officer Daniel X

also President Khurrum Senior hired Vice Compliance, of Shah. our We

TOI rapidly care in Care TOI million. past Oncology the savings our the we or in performance patient by oncology the During recent quarter, participation has our rising $X.X growth OCM. XXXX, To of program, OCM strategy. million to per Since Model most the has results episode. executing start significant made by that on recently CMS’s for X,XXX cost of $X.X target our savings in end, driven exceeding TOI of period, addressing progress from saw Medicare announced program close savings In of that

nationally. we value-based models cost. outcomes delivery. of advancement very oncology adoption performance directly demonstrated leading of care oncology lower it the proud savings, in track the In on addition as believe continues above for record better aggregate design for achieving support our to to I'm score. results average speaks of way cost and its quality TOI TOI's TOI of patients at the program, And this of meaningful payment, care based to we're

in for markets. traction exciting partnership a oncology in announced X, success in with TOI MaxHealth delivery with share We care March and medical leader our a the strong our oncology savings will oncology to patients exceptionally MaxHealth treat. Florida. Starting aligns in in also new an for patients recently to is reputation expansion building is MaxHealth in with care generated for Our outstanding Tampa and new a and model grow they approach Pinellas gaining share primary Bay, And third for MaxHealth in care contract to counties. care in care we're contract providing their will with value-based Hillsborough be relationship the we into coordination excited we game This We markets Florida. in entered into model and time. patient serve. provide well patients a to believe this counties new our services the contract relationship this over

Fresno and Fresno our Care marks by was continued gynecological highlight market Cancer in founded acquired to model wanted to XXth care opportunity our highly Dr. TOI more regarded expand and we Fresno, into our new practice communities. development Christopher the Perkins XX than cancer delivery breast California. central market expansion offers exciting Women's Another into in recently ago. a years

Some allowing in Angeles, and this our West clinic DeNovo in expand other our Florida important past quarter market first we Los further sixth our this model our Florida. City, highlights Los include Culver We on us opened progress Lakeland, the in XXnd into clinic clinic in Angeles opened a to our region. California,

rooms We fourth After more the location, in Riverside and patients more Long we've been that quarter, also working location, exam and acquiring of renovated the the Beach space. consolidated [indiscernible] radiation allowing serve in infusion adding to to our us area. expand oncology practice

new demonstrating quarter on over grow new our of earnings service to made expansion we've clinicians be pleased to five and you continue about of quarter, clinical our Medical We call. new a optimistic past investment progress we're oncology the we the this next forward Director unique continue model care. XXXX. look And our our on the in to progress with of Radiation line. updating adding team finally, Overall, we added also this in We our Oncology first

on over our call Mihir to provide financial I’ll first detail back additional Now to the turn quarter results.

Mihir Shah

the year-over-year. $XX of Brad. quarter, line, with Thanks, a XX.X% in top the increase first Starting we achieved total revenue million

the acquisitions We which continue we that integrate quarter, million approximately and the period. four close the $X to fourth Acqui-hired in practice contributed in

first in this impacted growth in conference our our made revenue quarter terminate large year-over-year end year have the in late discussed payer to and call, of decision in Absent the strategic we XXXX termination, this XX.X%. would XXXX, we revenue been our first quarter. As contract growth a

quarter, our gross and the income GAAP over margin first year net $XX increase our for XX.X%, the On gross basis, million prior X.X% our million a the was a profit $XX period. was For quarter. was

this For acquisition EBITDA are on $XX cash the or talk adjusted clinic $X our At Further quarter, or how as we end, we XX-Q. our adjusting EBITDA provider we part our quarter was million. define negative EBITDA, our details found can When adjusted about million. startup our be in of was adjusted metric. costs balance not

to enhance our and be to growth. capital this support expect sufficient operations We

I you. debt back have outstanding. it Brad no to We turn over will now. Thank

Brad Hively

Okay.

our first for to XXXX turning for Now unchanged. Results the remains expected and guidance. of in as came XXXX outlook quarter

full XXXX XX% guiding to year revenue. we range growth the million, XXXX, a of XX% revenue to to over For $XXX are million representing $XXX

the With range profit in spend negative gross we in $XX $XX million to respect are and remains guidance to $XX of million in on of $XX EBITDA to Our far XXXX. so adjusted track million our SG&A, million. range the negative with

on the that year In infrastructure we adjusted our company our investments We steps related we’ve service We to support its made a adding XXXX, strategy delivering first new in back new we are quarter or to sites the new continue and to oncology reemphasize TOI are to markets model and progress are important lines. to summary, EBITDA, to in demonstrate costs up costs in to those D&O in particular, growth. not back to nor targeted of adding for our costs providers. public related want critical corporate any in new make care start

continue near the And and business to are and will reach long term. care to continued we on transition. to well we our As the positioned more drive we lives, value expand footprint shift capitalize this in based in our momentum believe

further markets deliver As ahead grow about the XXXX, of business, our communities. we patients opportunities more look excellent to and we the are excited our to and care expand rest to

and factors. Lastly, to time negotiated of share for the to fund And we the to be open notice, open program number or common market has stopped market Purchases at time otherwise. prior purchase are on transactions, company depend for million will or up of the to to to repurchased started from other with The Share back XXXX. conditions any may depending repurchase The time timing privately our the through without Directors December $XX turn actual intends may and factors. share Board I’ll it pleased through to its up through a liquidity. that be shares be authorized stock on conditions and operator cash market, questions. of it XX, program over company’s on announce repurchased and other available that, of

Operator

from Brian with Brian. from we question-and-answer go time, this session. Instructions] a Please [Operator First comes be you. your Thank conducting question At ahead Jefferies. question, will Tanquilut

Brian Tanquilut

the guess, how expand month, I about Hi, first you guys. structure ability just Brad, deal geographies. the is this MaxHealth you any share with maybe about further you're my if and us on of opportunity thinking can question replicate model the partnership new there, the color Good should on that that just we your that to and thinking that, announced as maybe be into afternoon. earlier

Brad Hively

from hear you. to Good Brian. Hi, Sure.

Brian Tanquilut

Yes.

Brad Hively

organization, Yes, we're is really partnership. excited a this growing rapidly a great about MaxHealth organization.

And by create which TOI MaxHealth contract. gain agreement it's primary this the are would great a also of Florida The then the that be can with we tracks to replicated treated We share construct a able and going group, region; sort forward. the we're not the think to of two are sign of by think accountable of performance to will control patients have the about patients and are where we control which created. that we be period, we us. think savings like have share in patients a intervention replicate think one then achieving in compared quality group are that that this to intend with if that way I for that treated associated and will we is that populations those the for partner care over outcomes then while that treat. going patients: And cost and of model TOI. in based MaxHealth we groups group, – intend we additional the the to quality generate to others value replicate savings It's with metrics

Brian Tanquilut

cancer Just of women's oncology. us you as with call Got – this about care, gears kind terms is your play your what anything Or think strategic I women's on angles it. would then this thoughts scale – point? more there, in any share at scale can And of out? a strategy you your that shifting of

Brad Hively

Yes, absolutely.

have that business work we payer with existing that in So well. and in we're that desire And or us it partners risk existing help bearing partners this and providers have for them These thesis development to really our our membership. excited manage membership are practice about fits really markets. Fresno a expressed we that

our build in so, very market market. that find Fresno the into the are we intend risk to pleased and the clinics there were And and additional de providers practice to novos entry Fresno payers serve Perkins as in better We point bearing to Dr. Fresno.

Brian Tanquilut

me the are year, I progression Then last it. about maybe the Got the EBITDA in QX, to earnings the about QX or for mean, as of quarter? how the thinking I of even from you for sequential think movement from question rest

Mihir Shah

look so, We're pleased about doing in was or nice over margins. gross expecting. gross quarter you were six I right and And that with the made course the We're gross from first most margins of bottom if what last line progress about we as so. of the to well Yes, a one the line SG&A we the uptick well. I on was printed EBITDA margin. think, really We drops on things [indiscernible] quarters in in

are little tracking had according So that's margins of gross and coming what expected. the to ahead bit plan we a

in the benefits drugs So continue purchasing, to our smarter about generates addition drug being lot additional translate, scale buying just purchasing the that of discounts. of to should a of gross more benefits scale margin

as scale our we to improve purchasing power. see those grow And so, continue discounts to we expect

expect a nice there. So trend positive we to see,

Brian Tanquilut

Awesome. Got it. Thanks.

Brad Hively

your questions, for Thanks Brian. Yep. Thank you.

Operator

from your Gary Please Taylor Gary. question, Thank next question you. from The with go ahead comes Cowen.

Gary Taylor

afternoon guys. good Hey,

what little Just the perhaps update anticipating, barely and pharmacy to was? a respond dispensary that dispensary. and a a fourth strategies any wondered, were just in you couple that sequentially, I revenue issue little questions, but on the the I down to quarter update some one thought know, and Medical was you with about bit talked just your the

Brad Hively

Gary sure. Yes, question. the thanks for

Rx Medical transition the dispensary the yes, growth first impact in negatively did So quarter. in our our

pursuing we We have different own we a mitigate last of to pharmacy. are our quarter, of that. couple the strategies Like launch announced

which we're we pharmacy, fill own our the at were will a able begin scripts currently launch about enable for that that and we're scripts of have moment, not strategies able well. we're we'll again. filling us strategies Medical previously to And that So begin those to at other to feeling to the good fill us to patients pursuing couple fill; we again of enabling likelihood as those those the

So later should that happen – and year. this that

will on ability this scripts. will ability this is our believe later to a So that And what temporary we year scripts. fill those those regain fill to restriction be we

Gary Taylor

thoughts Got on think as terms opportunities find you've in then updates your Texas. any mean, are capital it. state of in other identified I new just it's another markets one update allegation And that I there I thing, some mean, Texas? what to any and towards new

Brad Hively

quarter. the in so second We current in TOI our launching to about that excited very we're are do the Texas. quarter, intend in we Yes,

So clinic Texas. signing and we to our close our in very first partnership are, first launching

Gary Taylor

All that for news release. you. right, it. we'll Thank look Got

Brad Hively

you welcome. the for Thank You're questions.

Operator

ladies gentlemen, for session. would end Thank the like remarks. we Please Brad I sir. closing reached to have you. proceed call of And the Hively back turn and the question-and-answer to

Brad Hively

Great.

a we on progress look excited path of forward The for Institute coming a days. evening. Bye. with interest call. next joining to forward today. TOIs following really our your ahead, Oncology our in up really We're and Well, you We call several look the y'all thank on we Okay. and you in Have everybody good updating earnings to about you appreciate

Operator

This you. conference. Thank today's concludes

very at much disconnect participation. your may you You lines time. this Thank for your now

The Oncology Institute, Inc. (TOI) 12 May 222022 Q1 Earnings call transcript