HOUSTON, May 8, 2018 /CNW/ -- Nobilis Health Corp.
(NYSE American: HLTH) (NEO: HLTH) ("Nobilis" or the "Company")
today announced its financial results for the first quarter ended
March 31, 2018.
First Quarter Highlights
- First quarter Total Revenues were $64.5
million, a 5.6% decrease over the prior year period of
$68.3 million; Ness Loss for the
first quarter was $3.9 million,
compared to a loss of $2.4 million in
the prior corresponding period
- First quarter Adjusted EBITDA1 increased to
$5.1 million, a 152.7% increase
compared to the prior year period of $2.0
million
- Gross Margin in the first quarter increased by 2.8% to
$4.3 million
- Total case volumes in the first quarter increased by 19.0% to
5,275 cases
- Total Operations Expense per case in the first quarter
decreased by 21.2%
"Despite a reduction in top line revenues, we continued to see
significant improvements in our margins and key efficiency metrics.
Gross Margin edged up by nearly 60 basis points, Loss from
Operations improved by 12.3%, and Total Operating Expense per case
declined by 21.2%, year-over-year," said Harry Fleming, CEO.
"Total case volume for the first quarter was impacted by lower
than anticipated case volumes from our physician partners offset by
gains from higher than budgeted case volumes driven by our
marketing efforts. The first quarter also marked the first full
quarter of operations for our in-network Elite entities, acquired
in the fourth quarter of 2017. Integration is nearing completion,
and physician activity has remained strong from Q4 into Q1, which
we attribute to mutually collaborative attitudes, a strong
physician syndication, and the success of our marketing platform
among our new physicians. Following full integration of Elite into
the Nobilis system, we will begin looking for similar, in-network
acquisition opportunities like Elite that can benefit from Nobilis'
marketing operations."
First Quarter 2018 Results
Total revenues for the
first quarter of 2018 were $64.5
million, a 5.6% decrease from $68.3
million in the prior year period. Total case volume
increased by 844 cases to 5,275 cases, or 19.0%, compared to 4,431
cases in the prior corresponding period. The decrease in total
revenue was primarily due to the loss of two key physician groups
as well as the discontinuation of the Company's Lab Testing
ancillary service-line. Lab Testing represented approximately
$5.5 million dollars of revenue in Q1
of 2017 which did not re-occur in Q1 of 2018.
Revenue per case dipped to $12,219
in the first quarter due to the discontinuation of the Company's
Lab Testing ancillary, as well as a higher proportion of Nobilis'
case mix being derived from in-network sources, the growth of which
has been a longstanding goal of management.
Net loss attributable to Nobilis for the first quarter of 2018
was $3.9 million, or $0.05 per fully diluted share, compared to a net
loss of $2.4 million, or $0.03 per fully diluted share, in the first
quarter of 2017.
Adjusted EBITDA1 for the first quarter of 2018, which
adds back certain non-cash and non-recurring expenses, was
$5.1 million, an increase of 152.7%
over $2.0 million in the same quarter
last year.
Total cash was $23.2 million and
accounts receivable was $133.4
million as of March 31, 2018,
compared to $22.5 million and
$144.5 million, respectively, at
December 31, 2017.
Full Year 2018 Guidance
- Revenue in the range of $345.0
million to $355.0 million
- Adjusted EBITDA in the range of $57.0
million to $62.0 million
Conference Call Information
Nobilis Health will host a
conference call on May 8th, 2018, at
8:00 a.m. CDT (9:00 a.m. EDT) to discuss its financial results
for the first quarter 2018. To participate in the conference call,
please dial (866) 393-4306 in the U.S. and Canada, and +1 (734) 385-2616 internationally.
Please enter conference ID 5275098. There will be a livestream of
the conference call available at:
http://investors.nobilishealth.com/investors/events-and-presentations/.
About Nobilis Health Corp.
Nobilis Health
(www.NobilisHealth.com) is a full-service healthcare development
and management company, with more than 30 locations across
Texas and Arizona, including hospitals, ambulatory
surgery centers, and multi- specialty clinics. In addition, Nobilis
Health partners with more than 30 facilities across the country.
Marketing nine independent brands, Nobilis Health deploys a unique
patient acquisition strategy driven by proprietary, direct-
to-consumer marketing technology, focusing on a specified set of
procedures that are performed at its facilities by local
physicians. Nobilis Health's business model connects patients with
physicians and delivers the highest quality healthcare.
Forward Looking Statements
This press release contains
certain forward-looking statements within the meaning of Canadian
and United States securities laws,
including the safe harbor for forward-looking statements contained
in the Private Securities Litigation Reform Act of 1995, as
amended. Forward-looking statements include all statements that do
not relate solely to historical or current facts and may be
identified by the use of words such as "may," "believe," "will,"
"expect," "project," "estimate," "anticipate," "plan" or
"continue." These forward-looking statements are based on current
plans and expectations and are subject to a number of risks,
uncertainties and other factors which could significantly affect
current plans and expectations and our future financial condition
and results. These factors, which could cause actual results,
performance and achievements to differ materially from those
anticipated, include, but are not limited to our ability to
successfully maintain effective internal controls over financial
reporting; our ability to implement our business strategy, manage
the growth in our business, and integrate acquired businesses; the
risk of litigation and investigations, and liability claims for
damages and other expenses not covered by insurance; the risk that
payments from third-party payers, including government healthcare
programs, may decrease or not increase as costs increase; adverse
developments affecting the medical practices of our physician
limited partners; our ability to maintain favorable relations with
our physician limited partners; our ability to grow revenues by
increasing case and procedure volume while maintaining
profitability at the Nobilis Facilities; failure to timely or
accurately bill for services; our ability to compete for physician
partners, patients and strategic relationships; the risk of changes
in patient volume and patient mix; the risk that laws and
regulations that regulate payments for medical services made by
government healthcare programs could cause our revenues to
decrease; the risk that contracts are canceled or not renewed or
that we are not able to enter into additional contracts under terms
that are acceptable to us; and the risk of potential decreases in
our reimbursement rates. The foregoing are significant factors we
think could cause our actual results to differ materially from
expected results. However, there could be additional factors
besides those listed herein that also could affect us in an adverse
manner.
We have not undertaken any obligation to publicly update or
revise any forward-looking statements. All of our forward-looking
statements speak only as of the date of the document in which they
are made or, if a date is specified, as of such date. Subject to
any mandatory requirements of applicable law, we disclaim any
obligation or undertaking to provide any updates or revisions to
any forward-looking statement to reflect any change in our
expectations or any changes in events, conditions, circumstances or
information on which the forward-looking statement is based. All
subsequent written and oral forward-looking statements attributable
to us or persons acting on our behalf are expressly qualified in
their entirety by the foregoing factors and in our Annual Report on
Form 10-K for the fiscal year ended December
31, 2017, filed on March 12,
2018, as updated by other filings with the Securities and
Exchange Commission.
Nobilis Health
Corp. Consolidated Balance Sheets March 31,
2018 and December 31, 2017 (in thousands, except share
amounts) (unaudited)
|
|
|
|
|
March
31, 2018
|
December
31, 2017
|
Assets
|
|
|
Current
Assets:
|
|
|
Cash
|
$
23,239
|
$
22,536
|
Trade accounts
receivable, net of allowance of $3,629 and $2,598 at March 31, 2018
and December 31, 2017, respectively
|
133,362
|
144,522
|
Medical
supplies
|
3,146
|
3,356
|
Prepaid expenses and
other current assets
|
15,126
|
14,472
|
Total current
assets
|
174,873
|
184,886
|
Property and equipment,
net
|
49,035
|
51,559
|
Intangible assets,
net
|
64,340
|
65,990
|
Goodwill
|
116,072
|
116,072
|
Deferred tax
asset
|
10,933
|
9,951
|
Other long-term
assets
|
2,580
|
2,580
|
Total
Assets
|
$
417,833
|
$
431,038
|
Liabilities and
Shareholders' Equity
|
|
|
Current
Liabilities:
|
|
|
Trade accounts
payable
|
$
18,680
|
$
24,312
|
Accrued
liabilities
|
33,724
|
35,393
|
Current portion of
capital leases
|
3,040
|
3,249
|
Current portion of
long-term debt
|
3,766
|
3,766
|
Current portion of
convertible promissory notes
|
6,750
|
4,250
|
Other current
liabilities
|
13,786
|
16,324
|
Total current
liabilities
|
79,746
|
87,294
|
Lines of
credit
|
24,000
|
18,000
|
Long-term capital
leases, net of current portion
|
12,025
|
12,667
|
Long-term debt, net of
current portion
|
89,021
|
90,619
|
Convertible promissory
notes, net of current portion
|
1,750
|
4,250
|
Warrant and stock
option derivative liabilities
|
445
|
384
|
Other long-term
liabilities
|
2,927
|
3,036
|
Total
liabilities
|
209,914
|
216,250
|
Commitments and
Contingencies
|
|
|
Contingently redeemable
noncontrolling interest
|
16,947
|
17,161
|
Total shareholders'
equity
|
|
|
Common shares, no par
value, unlimited shares authorized, 78,183,802 shares issued
and outstanding at March 31, 2018 and December 31, 2017
|
—
|
—
|
Additional paid in
capital
|
226,624
|
225,790
|
Accumulated
deficit
|
(79,101)
|
(75,245)
|
Total shareholders'
equity attributable to Nobilis Health Corp.
|
147,523
|
150,545
|
Noncontrolling
interests
|
43,449
|
47,082
|
Total shareholders'
equity
|
190,972
|
197,627
|
Total Liabilities and
Shareholders' Equity
|
$
417,833
|
$
431,038
|
Nobilis Health
Corp.
|
Consolidated
Statements of Operations
|
(in thousands,
except share and per share amounts)
|
(unaudited)
|
|
|
|
|
Three Months
Ended March 31,
|
|
2018
|
2017
|
|
|
|
Revenues:
|
|
|
Patient and net
professional fees
|
$
63,513
|
$
64,901
|
Contracted marketing
revenues
|
135
|
1,379
|
Factoring
revenues
|
809
|
2,022
|
Total
revenues
|
64,457
|
68,302
|
Operating
expenses:
|
|
|
Salaries and
benefits
|
16,227
|
15,321
|
Drugs and
supplies
|
9,915
|
12,744
|
General and
administrative
|
28,323
|
33,688
|
Bad debt expense,
net
|
1,031
|
—
|
Depreciation and
amortization
|
4,631
|
2,338
|
Total operating
expenses
|
60,127
|
64,091
|
Corporate
expenses:
|
|
|
Salaries and
benefits
|
2,611
|
2,439
|
General and
administrative
|
3,545
|
4,253
|
Legal
expenses
|
830
|
571
|
Depreciation
|
94
|
83
|
Total corporate
expenses
|
7,080
|
7,346
|
Loss from
operations
|
(2,750)
|
(3,135)
|
Other expense
(income):
|
|
|
Change in fair value
of warrant and stock option derivative liabilities
|
61
|
(375)
|
Interest
expense
|
2,885
|
1,255
|
Other income,
net
|
(1,851)
|
(258)
|
Total other
expense (income)
|
1,095
|
622
|
Loss before income
taxes and noncontrolling interests
|
(3,845)
|
(3,757)
|
Income tax benefit,
net
|
(704)
|
(1,551)
|
Net loss
|
(3,141)
|
(2,206)
|
Net income attributable
to noncontrolling interests
|
711
|
192
|
Net loss attributable
to Nobilis Health Corp.
|
$
(3,852)
|
$
(2,398)
|
Net loss per basic
common share
|
$
(0.05)
|
$
(0.03)
|
Net loss per fully
diluted common share
|
$
(0.05)
|
$
(0.03)
|
Weighted average shares
outstanding (basic)
|
78,183,802
|
77,805,014
|
Weighted average shares
outstanding (fully diluted)
|
78,183,802
|
77,805,014
|
Nobilis Health
Corp.
|
Consolidated
Statements of Cash Flows
|
(in
thousands)
|
(unaudited)
|
|
|
|
Three Months Ended
March 31,
|
|
2018
|
2017
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
Net loss
|
$
(3,141)
|
$
(2,206)
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
Depreciation and
amortization
|
4,725
|
2,421
|
Provision for bad
debts
|
1,031
|
—
|
Share-based
compensation
|
835
|
1,264
|
Change in fair value of
warrant and stock option derivative liabilities
|
61
|
(375)
|
Deferred income
taxes
|
(982)
|
(1,831)
|
Loss on sale of
property and equipment
|
61
|
—
|
Loss from equity method
investment
|
—
|
61
|
Amortization of
deferred financing fees
|
340
|
109
|
Changes in operating
assets and liabilities, net of assets acquired and liabilities
assumed:
|
|
|
Trade accounts
receivable
|
10,129
|
22,966
|
Medical
supplies
|
210
|
802
|
Prepaid expenses and
other current assets
|
(656)
|
(2,514)
|
Trade accounts payable
and accrued liabilities
|
(7,301)
|
(5,170)
|
Other current
liabilities
|
(2,537)
|
1,194
|
Other long-term
liabilities
|
(110)
|
(189)
|
Net cash provided by
operating activities
|
2,665
|
16,532
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
Purchase of property
and equipment
|
(641)
|
(3,506)
|
Proceeds on sale of
property and equipment
|
22
|
—
|
Acquisitions, net of
cash acquired
|
—
|
(7,883)
|
Net cash used for
investing activities
|
(619)
|
(11,389)
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
Distributions to
noncontrolling interests
|
(4,554)
|
(1,200)
|
Payments on capital
lease obligations
|
(851)
|
773
|
Proceeds from line of
credit
|
6,000
|
3,000
|
Payments on
debt
|
(1,938)
|
(656)
|
Deferred financing
fees
|
—
|
(466)
|
Net cash (used for)
provided by financing activities
|
(1,343)
|
1,451
|
NET INCREASE IN
CASH
|
703
|
6,594
|
CASH — Beginning of
period
|
22,536
|
24,572
|
CASH — End of
period
|
$
23,239
|
$
31,166
|
Nobilis Health
Corp.
|
Reconciliation of
Non-GAAP Financial Measures
|
(in
thousands)
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
2017
|
|
|
|
Net income (loss)
attributable to Nobilis Health Corp.
|
(3,852)
|
(2,398)
|
Interest
|
2,885
|
1,255
|
Income tax expense
(benefit), net
|
(704)
|
(1,551)
|
Depreciation and
amortization
|
4,725
|
2,421
|
EBITDA
|
3,054
|
(273)
|
|
|
|
Non-cash compensation
expenses
|
835
|
1,264
|
Change in fair value of
warrant and stock option derivative liabilities
|
61
|
(375)
|
Acquisition
expenses
|
829
|
634
|
Non-recurring
expenses
|
307
|
763
|
Adjusted
EBITDA1
|
5,086
|
2,013
|
|
|
|
|
1 Use of
Non-GAAP Financial Measures
|
Adjusted EBITDA is defined as earnings before interest,
income taxes, depreciation and amortization, non-cash compensation
expenses, change in fair value of warrant and stock option
derivative liabilities, acquisition expenses, and non-recurring
expenses. Adjusted EBITDA should not be considered a measure of
financial performance required by accounting principles generally
accepted in the United States of
America ("U.S. GAAP"). Items excluded from Adjusted EBITDA
are significant components in understanding and assessing financial
performance. Adjusted EBITDA is an analytical indicator used by
management and the health care industry to evaluate company
performance, allocate resources and measure leverage and debt
service capacity. Adjusted EBITDA should not be considered in
isolation or as an alternative to net income, cash flows generated
by operations, investing or financing activities, or other
financial statement data presented in the consolidated financial
statements as indicators of financial performance or liquidity.
Because Adjusted EBITDA is not a measurement determined in
accordance with U.S. GAAP and is thus susceptible to varying
calculations, Adjusted EBITDA as presented may not be comparable to
other similarly titled measures of other companies.
Contact Information:
Joel
Lehr
Assistant Vice President, Corporate Communications
IR@nobilishealth.com
346-207-6342
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SOURCE Nobilis Health Corp.