Continued momentum drives Yr/Yr Revenue growth of 321%
MONTREAL, May 10, 2021 /CNW Telbec/ - Dialogue Health Technologies Inc. (TSX: CARE) ("Dialogue" or the "Company"), Canada's premier health and wellness virtual healthcare platform, today announced its financial and operational results for the three months ended March 31, 2021. Financial references are in Canadian dollars unless otherwise indicated.
"Q1 2021 was truly a banner quarter for Dialogue, we landed a number of marquee customers, completed a $100 million Initial Public Offering and maintained our growth trajectory," said Cherif Habib, CEO of Dialogue. "We remain focused on executing on our Integrated Health Platform™ strategy to meet the increasing health and wellness needs of our customers."
Q1 2021 Financial Highlights
(All capitalized terms not defined herein, shall have the meaning ascribed to them in the Management's Discussion and Analysis for the three months ending March 31, 2021; Comparison periods in each case are the three months ended March 31, 2020, unless otherwise stated)
- Annual Recurring and Reoccurring Revenue grew to $65.3 million with new customer wins, including a major telecom, two top 30 law firms and a brand name consumer retailer, as well as, program expansions with existing customers, including the Mental Health and Employee Assistance Program ("EAP") offerings to existing instances of Primary Care
- Revenue increased 4X to $15.2 million, compared to $3.6 million, due to growth in Members, including Members from agreements with strategic distribution partners, an increase in attach rate, as well as the acquisition of Optima Global Health Inc. ("Optima") on October 1, 2020
- Members grew to close to 1.3 million an increase of 335,000 or 35.9% compared to December 31, 2020. Annual Recurring and Reoccurring Revenue grew to $65.3 million as of March 31, 2021, compared to $58.5 million as of December 31, 2020
- Attach Rate grew to 1.08, compared to 1.07 as at December 31, 2020, as customers continue to expand the services they offer Members from Dialogue's Integrated Health Platform™ ("IHP"), of primary care, Mental Health and EAP offering
- Gross Margin was 41.5%, compared to 43.7%, due to the lower margin profile of the Optima acquisition
- Adjusted EBITDA1 loss was $5.0 million, an increase of $0.4 million, due to higher expenses, partially offset by higher gross profit
- Total Comprehensive Loss was $230.9 million, compared to $5.0 million, due primarily to the one-time non-cash accounting charge of $225.5 million related to the increase in the fair market value conversion feature of the Class B preferred shares. This charge was a result of the increase in the value of the Common Shares of the Company prior to the IPO. The remaining net increase of $0.4 million was due to an increase in operating expenses, from investments in product and development, sales and marketing and general and administrative costs, and the acquisition of Optima, which was partially offset by higher gross margin
- Cash and Cash Equivalents were $129.0 million as of March 31, 2021 compared to $42.1 million as of December 31, 2020, the increase was primarily the result of net proceeds from the initial public offering of $90.6 million
Q1 2021 Business Highlights
- The Company strengthened its IHP strategy, integrating the EAP program into the same intuitively designed member application to provide a one-stop solution to improve both the HR and member experience, allowing members to schedule a consultation regarding a physical health, mental health, and financial support issue all in minutes, within the same application
- The Company has started transitioning customers of Optima, a leading Canadian EAP provider acquired in 2020, to its virtual care solution, to improve the customer and user experience
- The Company launched its new proprietary wellness intake process for members that optimized 6,000 intake questions to more quickly match members with practitioners which results in more than 900 dispatch possibilities generated from only five questions, ensuring our members can schedule an appointment within minutes
- As part of the Company's commitment to the Accessibility for Ontarians with Disabilities Act, it updated its member application to comply with WCAG 2.0 Level AA, so its services are accessible for all users, including those with visual, hearing, motor and cognitive challenges
- The Company launched its new content management system capability within its application, allowing members to view relevant wellness-related articles and tips without leaving the Dialogue application enabling the Company's experts to engage members with proprietary content
- The Company launched a new OHS Portal for its German business to allow clients to digitize and streamline the occupational health & safety experience and better connect the Company's safety experts to clients
- The Company closed its $100 million initial public offering and its common shares commenced trading on the Toronto Stock Exchange under the symbol "CARE"
- The Company earned a Best Workplaces for Women recognition and the Company ranked # 15 on the list of Best Workplaces in Canada.
Notice of Conference Call
Dialogue will host a live video webinar Tuesday, May 11, 2021 at 10:00 AM ET to discuss its financial results. Mr. Cherif Habib, CEO, and Mr. Navaid Mansuri, CFO, will co-chair the call. All interested parties can join the event at https://us02web.zoom.us/webinar/register/WN_PAT2ougQQXS7kvgiM2jh1w. A link to the live event will be available on the Investors Events page on the Company's website at www.investors.dialogue.co. The presentation will be accompanied by slides, which will be available on the screen view and will be made available following the webinar on the Company's website. Please connect at least 15 minutes prior to the event to ensure adequate time for any software download of Zoom that may be required to attend the event. Listeners that prefer to dial in by phone may do so by accessing the same web link and the dial in details will be provided by email upon registration.
1Non-IFRS Financial Measures
This press release makes reference to certain non IFRS measures, such as "EBITDA" (which stands for net profit or loss before net financing expenses, income taxes, depreciation of property and equipment, amortization of intangible assets and amortization of right-of-use assets) and "Adjusted EBITDA" (which stands for adjusted net profit or loss before net financing expenses, income taxes, depreciation of property and equipment, amortization of intangible assets, amortization of right-of-use assets, transaction costs, acquisition costs, change in fair value of conversion feature and share-based payments expense). These measures are not recognized under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information as reported under IFRS. Management also believes that other users, such as securities analysts, investors and other interested parties, frequently use non-IFRS measures, particularly in the evaluation of issuers.
Management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. Where applicable, we provide a clear quantitative reconciliation from the non-IFRS financial measures to the most directly comparable measure calculated in accordance with IFRS.
The following table reconciles net loss to Adjusted EBITDA loss for the three months ended March 31, 2021 and March 31, 2020:
DIALOGUE HEALTH TECHNOLOGIES INC. |
|||||
ADJUSTED EBITDA |
|||||
FOR THE THREE MONTH ENDED MARCH 31, 2021 AND 2020 |
|||||
(in thousands of CAD) |
Three Months Ended March 31 |
||||
2021 |
2020 |
||||
Net loss |
$ |
(231,235) |
$ |
(4,938) |
|
Net financing expenses |
188 |
55 |
|||
Income taxes |
(105) |
- |
|||
EBIT |
(231,152) |
(4,883) |
|||
Depreciation of property and equipment |
109 |
108 |
|||
Amortization of intangible assets |
330 |
76 |
|||
Amortization of right-of-use assets |
148 |
120 |
|||
EBITDA |
(230,565) |
(4,579) |
|||
Share-based payments expense |
97 |
73 |
|||
Acquisition costs |
43 |
- |
|||
Change in fair value of conversion feature |
225,417 |
(67) |
|||
Adjusted EBITDA |
$ |
(5,008) |
$ |
(4,573) |
|
About Dialogue
Incorporated in 2016, Dialogue is Canada's premier virtual healthcare and wellness platform, providing affordable, on-demand access to quality care. Through our team of health professionals, we serve employers and organizations who have an interest in the health and well-being of their employees, members and their families. Our Integrated Health Platform™ is a one-stop healthcare hub that centralizes all of our programs in a single, user-friendly application, providing access to services 24 hours per day, 365 days per year from the convenience of a smartphone, computer or tablet.
Forward-Looking Information
This release includes "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of applicable securities laws. Forward-looking information may relate to our financial outlook (including revenues and Adjusted EBITDA), and anticipated events or results and may include information regarding our financial position, business strategy, growth strategies, addressable markets, budgets, operations, financial results, taxes, dividend policy, plans and objectives.
In some cases, but not necessarily in all cases, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "is positioned", "estimates", "intends", "assumes", "anticipates" or "does not anticipate" or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will" or "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking statements. Forward-looking statements are not historical facts, nor guarantees or assurances of future performance but instead represent management's current beliefs, expectations, estimates and projections regarding future events and operating performance.
Forward-looking statements are necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by Dialogue as of the date of this release, are subject to inherent uncertainties, risks and changes in circumstances that may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ, possibly materially, from those indicated by the forward-looking statements include, but are not limited to, the risk factors identified under "Risk Factors" in the Company's latest annual information form, and in other periodic filings that the Company has made and may make in the future with the securities commissions or similar regulatory authorities in Canada, all of which are available under the Company's SEDAR profile at www.sedar.com. These factors are not intended to represent a complete list of the factors that could affect Dialogue. However, such risk factors should be considered carefully. There can be no assurance that such estimates and assumptions will prove to be correct. You should not place undue reliance on forward-looking statements, which speak only as of the date of this release. Dialogue undertakes no obligation to publicly update any forward-looking statement, except as required by applicable securities laws.
Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not currently known to us or that we currently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, you should not place undue reliance on forward-looking information. The forward-looking information represents our expectations as of the date of this earnings release (or as the date it is otherwise stated to be made) and is subject to change after such date. However, we disclaim any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable Canadian securities laws. All of the forward-looking information contained in this earnings release is expressly qualified by the foregoing cautionary statements.
DIALOGUE HEALTH TECHNOLOGIES INC. |
||||||
INTERIM CONDENSED CONSOLIDATED STATEMENT OF NET LOSS AND OTHER COMPREHENSIVE LOSS |
||||||
FOR THE THREE MONTH ENDED MARCH 31, 2021 AND 2020 |
||||||
Three Months Ended March 31 |
||||||
2021 |
2020 |
|||||
Revenue |
$ |
15,238,417 |
$ |
3,618,361 |
||
Cost of services |
8,907,939 |
2,035,968 |
||||
Gross profit |
6,330,478 |
1,582,393 |
||||
Operating Expenses |
||||||
General and administrative |
7,583,676 |
3,436,472 |
||||
Sales and marketing |
2,398,271 |
1,873,237 |
||||
Product and development |
1,987,363 |
1,149,326 |
||||
Share-based payments expense |
96,701 |
73,199 |
||||
12,066,011 |
6,532,234 |
|||||
Operating loss |
(5,735,533) |
(4,949,841) |
||||
Other expenses |
||||||
Change in fair value of conversion feature |
225,416,590 |
(66,916) |
||||
Net financing expenses |
187,638 |
54,679 |
||||
225,604,228 |
(12,237) |
|||||
Net Loss before income taxes |
$ |
(231,339,761) |
$ |
(4,937,604) |
||
Deferred income tax recovery |
104,639 |
- |
||||
Net loss |
$ |
(231,235,122) |
$ |
(4,937,604) |
||
Other comprehensive (loss): |
||||||
Items that may be reclassified subsequently to net loss |
||||||
Foreign currency translation |
310,534 |
(93,870) |
||||
Total comprehensive loss |
$ |
(230,924,588) |
$ |
(5,031,474) |
||
Loss per share-Basic and Diluted |
(3.55) |
(0.44) |
||||
DIALOGUE HEALTH TECHNOLOGIES INC. |
||||||||
INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION |
||||||||
As at |
||||||||
March 31, 2021 |
December 31, 2020 |
|||||||
Assets |
||||||||
Current assets |
||||||||
Cash and cash equivalents |
$ |
129,021,671 |
$ |
42,067,100 |
||||
Trade and other receivables |
12,598,901 |
11,358,615 |
||||||
Asset held for sale |
- |
909,541 |
||||||
Prepaid expenses |
1,201,057 |
745,673 |
||||||
142,821,629 |
55,080,929 |
|||||||
Property and equipment |
1,096,981 |
1,019,406 |
||||||
Right-of-use assets |
1,923,090 |
1,687,434 |
||||||
Intangible assets |
5,627,205 |
5,472,196 |
||||||
Goodwill |
3,104,284 |
3,114,927 |
||||||
$ |
154,573,189 |
$ |
66,374,892 |
|||||
Liabilities |
||||||||
Current liabilities |
||||||||
Trade payable and accrued liabilities |
$ |
9,582,072 |
$ |
7,489,083 |
||||
Unearned revenue |
975,849 |
476,619 |
||||||
Liability related to asset held for sale |
- |
430,110 |
||||||
Current portion of contigent consideration payable |
1,330,436 |
1,379,501 |
||||||
Current portion of long-term debt |
398,020 |
398,020 |
||||||
Current portion of lease liabilities |
578,484 |
524,618 |
||||||
12,864,861 |
10,697,951 |
|||||||
Non-current portion of lease liabilities |
1,246,035 |
1,086,720 |
||||||
Non-current portion of long-term debt |
1,359,812 |
1,459,407 |
||||||
Non-current portion of contingent consideration payable |
790,654 |
523,499 |
||||||
Redeemable Class B preferred shares |
- |
82,805,661 |
||||||
Deferred Income Tax liability |
872,291 |
976,890 |
||||||
Conversion option on Redeemable Class B preferred shares |
- |
92,755 |
||||||
17,133,653 |
97,642,883 |
|||||||
Commitments and contingencies |
- |
- |
||||||
Shareholders' equity (deficit) |
||||||||
Share capital |
458,425,534 |
18,890,120 |
||||||
Equity reserve |
911,774 |
815,073 |
||||||
Cumulative translation adjustment |
(94,629) |
(405,163) |
||||||
Deficit |
(321,803,143) |
(50,568,021) |
||||||
137,439,536 |
(31,267,991) |
|||||||
$ |
154,573,189 |
$ |
66,374,892 |
|||||
DIALOGUE HEALTH TECHNOLOGIES INC. |
||||||||
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS |
||||||||
FOR THE THREE MONTH ENDED MARCH 31, 2021 AND 2020 |
||||||||
Three Months Ended March 31 |
||||||||
2021 |
2020 |
|||||||
Operating activities |
||||||||
Net loss |
$ |
(231,235,122) |
$ |
(4,937,604) |
||||
Items not affecting cash: |
||||||||
Write-off of leasehold improvements |
- |
157,715 |
||||||
Income tax recovery |
(104,639) |
- |
||||||
Change in conversion feature on preferred shares |
225,416,590 |
(66,916) |
||||||
Depreciation of property and equipment |
109,215 |
107,820 |
||||||
Amortization of right-of-use assets |
147,983 |
120,200 |
||||||
Net financing expenses |
254,109 |
128,522 |
||||||
Amortization of intangible assets |
330,381 |
75,558 |
||||||
Share-based payments expense |
96,701 |
73,199 |
||||||
(4,984,782) |
(4,341,506) |
|||||||
Net changes in non-cash operating working capital items: |
||||||||
Trade and other receivables |
(1,240,286) |
(895,842) |
||||||
Prepaid expenses |
(455,384) |
77,511 |
||||||
Trade payable and accrued liabilities |
2,092,990 |
1,491,676 |
||||||
Unearned revenue |
499,230 |
39,781 |
||||||
Interest paid |
(13,807) |
(16,154) |
||||||
(4,102,039) |
(3,644,534) |
|||||||
Investing activities |
||||||||
Purchase of property and equipment |
(186,789) |
(93,828) |
||||||
Purchase of intangible assets |
(18,471) |
- |
||||||
Sale of Asset held for sale |
909,541 |
- |
||||||
Botfront Acquisition |
(291,800) |
- |
||||||
412,481 |
(93,828) |
|||||||
Financing activities |
||||||||
Issuance of shares |
100,008,000 |
- |
||||||
Share issue costs |
(9,371,189) |
- |
||||||
Options Exercised |
392,441 |
17,451 |
||||||
Repayment of liability related to asset held for sale |
(430,110) |
- |
||||||
Repayment of long-term debt |
(100,005) |
- |
||||||
Repayment of lease liabilities |
(165,542) |
(144,258) |
||||||
90,333,595 |
(126,807) |
|||||||
Effect of foreign currency translation |
310,534 |
(93,870) |
||||||
Net increase in cash and cash equivalents |
86,954,571 |
(3,959,039) |
||||||
Cash and cash equivalents—beginning of quarter |
42,067,100 |
24,611,895 |
||||||
Cash and cash equivalents—end of quarter |
$ |
129,021,671 |
$ |
20,652,856 |
||||
SOURCE Dialogue Health Technologies Inc.
Investor relations, Navaid Mansuri, Chief Financial Officer, [email protected]; Media Relations, Jean-Christophe de Le Rue, Director of Public and Government Relations, [email protected] / 613-806-0671
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