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01/10 19:55
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call shows strong financial performance with a 32% revenue increase and 36% adjusted EBITDA growth, despite a net loss due to fair value adjustments. The company is resuming its stock buyback program, indicating confidence in undervaluation. Canadian market focus and operational challenges in acquisitions are noted, but strong organic growth and high returns from investments are positives. Q&A reveals management's strategic focus and adaptability, with some uncertainties. Overall, positive financial metrics and a buyback program suggest a likely positive stock price movement.
Quarterly Revenue $294,100,000, an increase of 32% year-over-year, driven by strong organic growth and acquisitions.
Adjusted EBITDA $27,600,000, a 36% increase compared to $20,200,000 in Q1 2024, negatively impacted by a $6,500,000 deferred revenue adjustment from Circle Medical.
Adjusted EBITDA (excluding Circle Medical impact) $34,100,000, reflecting a strong operational performance.
Canadian Revenue $120,600,000, a 32% year-over-year increase, with 13.4% organic growth.
Adjusted EBITDA in Canada $18,700,000, a 29% increase year-over-year, driven by strong organic growth.
Net Loss $41,900,000, compared to a net income of $13,800,000 in Q1 2024, primarily due to fair value adjustments and deferred revenue from Circle Medical.
Adjusted Net Income $7,500,000, down from $17,200,000 in Q1 2024, impacted by a prior year gain from the sale of Intra Health.
Adjusted Free Cash Flow $11,800,000, a slight decline from $12,600,000 in Q1 2024, due to higher capital expenditures and cash taxes.
Cash and Cash Equivalents $103,200,000 as of 03/31/2025, indicating a solid balance sheet.
Outstanding Debt Approximately CAD 340 million as of 03/31/2025, with compliance to all covenants.
Patient Visits 1,600,000, a 24% year-over-year increase, with Canadian visits growing by 30%.
Total Care Interactions 2,500,000, a 34% increase year-over-year, representing 27% organic growth.
WISP Revenue $29,500,000, a 40% increase from Q1 2024, with adjusted EBITDA of $459,000.
Wellstar Revenue Run Rate $70,000,000, with adjusted EBITDA margins of 29%.
HealWell Investment $28,900,000 net cash invested, with a current market value of $158,500,000, representing a 450% rate of return.
Circle Medical Patient Visits 208,000, a 19% growth over last year.
Canadian Clinics Revenue $319,000,000 in 2024, with a compound annual growth rate of over 50%.
Canadian Clinics Adjusted EBITDA Over $40,000,000 in 2024, with a CAGR of 44%.
Annual Adjusted EBITDA Target for Canada Over $100,000,000 by the end of next year.
HealWell AI: HealWell AI has made six acquisitions and raised over $150,000,000 in equity and debt financing, with Well Health's net cash contribution being $5,400,000.
Wellstar: Wellstar achieved organic growth of approximately 20% and has a $70,000,000 annual revenue run rate.
CyberWell: CyberWell provides cybersecurity for critical infrastructure and is expected to contribute to Well's growth.
Canadian Clinics Network: Well Health aims to increase its market share in Canada from 1% to 10%, targeting over $5,000,000,000 in annual revenue.
Divestment of U.S. Assets: Well Health plans to divest its U.S. care delivery businesses to focus on Canadian operations, which are yielding better returns.
Patient Visits: Well Health delivered over 1,600,000 patient visits in Q1, a 24% year-over-year increase.
Provider Network: Well Health has over 4,300 providers and clinicians, with over 1,000 physicians in Canada.
Stock Buyback Program: Well Health intends to resume its stock buyback program shortly after reporting Q1 results.
Focus on Canadian Market: Well Health is prioritizing its Canadian clinics network and plans to grow organically and through acquisitions.
Divestment of U.S. Care Businesses: The company plans to divest its U.S. care delivery businesses, including CRH and provider staffing, to unlock capital for growth in Canada. This decision is based on better returns on capital in Canada and aims to reduce operational complexity.
Regulatory Issues: The sale process for Circle Medical is currently affected by a regulatory inquiry, which may impact the timing and conditions of the sale.
Competitive Pressures: The company faces competitive pressures in the U.S. healthcare market, particularly in provider staffing, which is noted to potentially fetch higher multiples than general anesthesia due to provider scarcity.
Market Volatility: The company acknowledges volatility in the U.S. healthcare markets, which influences its decision to focus on the Canadian market where it sees more predictable growth.
Operational Challenges in Acquisitions: The company recognizes the challenges in scaling its clinic transformation team and the need for significant resources to successfully integrate and improve acquired clinics.
Economic Factors: The company is aware of the economic environment affecting healthcare, including inflation sensitivity in the U.S. care business, which may impact profitability.
Investment Risks: The company has invested significantly in its subsidiaries, and while these investments have yielded high returns, there is inherent risk in the performance of these entities and their market conditions.
Divestment of U.S. Care Delivery Businesses: Well Health plans to divest its U.S. care delivery businesses, including Circle Medical and WIST, to focus on its Canadian operations, particularly Well Clinics.
Growth in Canadian Clinics Network: The company aims to achieve a 10% market share in Canadian clinics, targeting over $5 billion in annual revenue.
Stock Buyback Program: Well Health intends to resume its stock buyback program to enhance shareholder value.
Wellstar Spinout: Wellstar, a subsidiary focused on healthcare technology, is expected to be spun out as a publicly listed company by late 2025 or early 2026.
HealWell Acquisition of Orion Health: HealWell's acquisition of Orion Health is expected to contribute approximately $120 million in revenue and positive EBITDA to Well's consolidated financial results in 2025.
2025 Revenue Guidance: Well Health expects revenue for 2025 to be between $1.35 billion and $1.4 billion, excluding Circle Medical's impact.
2025 Adjusted EBITDA Guidance: The company projects adjusted EBITDA for 2025 to be between $140 million and $160 million.
Canadian Business Growth: Well Health anticipates over 25% growth in adjusted EBITDA for its Canadian business in 2025.
Long-term Revenue and EBITDA Goals: The company targets over $800 million in revenue and over $100 million in adjusted EBITDA for its Canadian operations in the next couple of years.
Share Buyback Program: The company intends to resume its stock buyback program shortly after reporting Q1 results, indicating a belief that their shares are undervalued.
The earnings call summary and Q&A reveal strong financial performance, including a dividend increase, margin expansion, and robust acquisition activity. The raised FFO guidance and strategic focus on technology and operational improvements further bolster positive sentiment. Although management was vague on some metrics, the overall outlook is optimistic with consistent growth and a solid balance sheet, suggesting a positive stock price movement in the short term.
The earnings call summary and Q&A reveal mixed signals. Strong financial metrics and optimistic guidance are offset by deferred revenue and cybersecurity impacts. The M&A pipeline and Healwell acquisition are positive, but lack of specifics on margin expansion and capital stack raises concerns. Management's general responses and deferred updates contribute to uncertainty. Without a clear market cap, a neutral prediction (-2% to 2%) is prudent, balancing positive and negative factors.
The earnings call shows strong financial performance with a 32% revenue increase and 36% adjusted EBITDA growth, despite a net loss due to fair value adjustments. The company is resuming its stock buyback program, indicating confidence in undervaluation. Canadian market focus and operational challenges in acquisitions are noted, but strong organic growth and high returns from investments are positives. Q&A reveals management's strategic focus and adaptability, with some uncertainties. Overall, positive financial metrics and a buyback program suggest a likely positive stock price movement.
The earnings call highlights strong financial performance with significant FFO and NOI growth, a strategic acquisition, and increased guidance. Despite some lack of clarity in the Q&A, the overall sentiment remains positive with a focus on growth and operational efficiency. The substantial acquisition and improved guidance suggest a positive impact on the stock price, likely leading to a 2% to 8% increase over the next two weeks.
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