KELOWNA, BC, Nov. 12, 2015 /CNW/ - (TSX-V: QHR) QHR Corporation ("QHR" or the "Company"), a leader in the Healthcare Information Technology sector, has announced financial results for its quarter ended September 30, 2015, reporting year over year revenue growth of 13% to $7.1 million for Q3 2015 compared to $6.2 million in Q3 2014. The Company also reported a 20% increase in recurring revenue run rate to $24.1 million at the end of Q3 2015 compared to $20.1 million at the end of Q3 2014. For comparison purposes and in light of the recent sale of the Company's RCM Assets, the revenue and expenses from these assets have been removed from continuing operations.
Third Quarter 2015 Highlights:
- Third quarter revenues were a record $7.1 million, a 13% increase over Q3 2014 revenue of $6.2 million.
- Increased recurring revenue run rate to $24.1 million, up 20% from $20.1 million, at the end of Q3 2014.
- Recurring revenue for the quarter was 85% of total revenue, compared to 81% in Q3 of 2014.
- Adjusted EBITDA(1) for Q3 2015 of $0.8 million or 10.7% of revenue.
- Basic Earnings (Loss) per Share from continuing operations of ($0.01) for the quarter compared to $0.01 for Q3 2014.
- The Company closed the quarter with $11.3 million of cash and receivables.
"This quarter delivered increases in both sales and installation volumes which are leading indicators of growth for QHR. We are seeing record levels of electronic medical records system adoption across the country and, as the largest single platform EMR in Canada, our momentum continues to build." said Mike Checkley, President & CEO of QHR Corporation.
During the quarter the Company completed the sale of substantially all of its RCM Assets to a US-based billing and clearinghouse company. In this transaction, QHR's wholly-owned subsidiary sold substantially all of its RCM Assets, including customer relationships, products, related intellectual property, and some of its employees, in exchange for a cash purchase price in an amount to be determined and paid over an earn-out period of 36 months from closing. QHR does not anticipate that proceeds from this transaction will be material. The primary benefit of this transaction lies in projected cost savings, as the sale was part of an overall restructuring effort to save $1.6 to $2.0 million in annualized expenses.
"I am pleased to see our financials continue to improve, mostly through organic sales which is our highest margin growth area. With the restructuring costs substantially complete, our attention turns to generating improved margins and scaling the core business" said Jerry Diener, CFO of QHR.
Record revenue of $7.1 million for Q3 2015 was largely driven by organic growth of the Accuro EMR product. Revenue increased by $819,132 or 13% from $6.2 million during Q3 2014.
Net Earnings (Loss)
The net loss for the quarter ended September 30, 2015 was $1,149,856, primarily driven by the $850,105 loss from discontinued operations.
For the quarter ended September 30, 2015, operating activities resulted in net cash outflows of $861,978. The cash outflow for Q3 in 2015 was driven primarily by working capital requirements.
At September 30, 2015, the Company had cash and cash equivalents in the amount of $7.6 million and trade and other receivables of $3.7 million. The Company is not using any of its operating line and has no outstanding debt.
Full financial statements together with Management's Discussion and Analysis are available on SEDAR.
About QHR Corporation
QHR is a leader in Healthcare Technology, empowering providers and connecting patients. With an 11-year track record offering what is now the single leading Electronic Medical Records platform in Canada, QHR has a suite of complementary offerings that empower health professionals and drive the Company's growth. The Company's technologies and services enable secure medical records management for clinical environments, empower health providers with tools for virtual care including secure video and messaging, and tools for clinic management including scheduling, billing, and patient management, Health providers choose QHR to drive efficiencies within their practice and improve the quality of care delivered to patients.
(1) Management uses a non-IFRS measure of EBITDA and Adjusted EBITDA as supplemental measures to evaluate the performance of the Company. EBITDA is defined as earnings before income tax expense, financing costs, depreciation, amortization and stock-based compensation. Adjusted EBITDA is defined as EBITDA adjusted with acquisition, transition and integration costs and other expenses that do not impact core operating performance.
Management believes that EBITDA and Adjusted EBITDA provide important measures of the Company's operating performance because they allow management, investors and others to evaluate and compare the Company's core operating results, including its return on capital and operating efficiencies, from period to period by removing the impact of its capital structure (interest expense), asset base (depreciation and amortization), tax consequences, other non-core operating items (acquisition costs) and other non-free cash items. Both EBITDA and Adjusted EBITDA do not have any standardized meaning prescribed by IFRS, other companies may calculate these non-IFRS measures differently, and therefore our EBITDA and Adjusted EBITDA may not be comparable to a similar titled measure by other companies. Accordingly, investors are cautioned not to place undue reliance on them and are also urged to read all accounting disclosures presented in the un- audited consolidated financial statements and accompanying notes for the most recently completed quarter.
Conference Call - The Company's executives will host a conference call at 11:00 AM EDT (8:00 AM PDT) Thursday, November 12, 2015, to discuss the Company's Q3 2015 financial results. To join the conference call, please dial Toll Free 1-888-390-0546, Conference ID# 43554739
On behalf of the Board of Directors
Mike Checkley, President & CEO
Legal Notice Regarding Forward Looking Statements
This news release may contain "forward looking statements" within the meaning of applicable Canadian securities legislation. These statements are subject to risks that may cause the actual results to be materially different in future periods from those expressed or implied by such forward looking statement. Forward-looking statements in this news release include those concerning the Company's anticipation that its EMR momentum will continue to build, that proceeds from the sale of the RCM Assets will not be material and its projection that the primary benefit from the sale of the RCM Assets lies in projected cost savings of between $1.6 and $2.0 million annually. Risks that may prevent or delay the forward looking statements from coming to fruition include the possibility that the Company may not offer products that are acceptable to industry regulators or customers; competition, the availability of capital, changing regulatory requirements, the Company's ability to attract and retain key personnel, product obsolescence, work flow and market factors that could increase costs more than expected. QHR is a technology business development enterprise where investment and product enhancements must be carefully managed to achieve long-term revenue growth and profitability. It is the Company's policy not to update forward looking statements except to the extent required under applicable securities laws. Further information on the Company is available at www.sedar.com or at the Company's website, www.QHRtechnologies.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE QHR Corporation
For further information: Mike Checkley, President & CEO, 250.979.1709, mike.checkley@QHRtech.com; Jerry Diener, CFO & VP Finance, 250.979.1722, jerry.diener@QHRtech.com