2023 Q1 highlights:
- Revenue was $18.2 million, an
increase of 30% compared to the corresponding period of 2022
- Net income was $5.0 million, an
increase of 48% compared to the corresponding period of 2022
- Cash, cash equivalents and short-term investments of
$43.0 million
SANTA
CLARA, Calif., May 10, 2023
/PRNewswire/ -- Semler Scientific, Inc. (Nasdaq: SMLR), a company
that develops, manufactures and markets innovative medical products
and services that assist in evaluating and treating chronic
diseases, today reported financial results for the three months
ended March 31, 2023.
"We are pleased to report record quarterly revenues and pre-tax
net income predominately from sales of QuantaFlo for peripheral
artery disease testing," said Doug
Murphy-Chutorian, MD, interim chief executive officer of
Semler Scientific. "We are encouraged by our first quarter results
and are highly focused on developing our business in two new
disease areas, heart dysfunction and diabetes."
FINANCIAL RESULTS
For the first quarter ended March 31,
2023, compared to the corresponding period of 2022, Semler
Scientific reported:
- Revenue of $18.2 million, an
increase of $4.2 million, or 30%,
compared to $14.0 million.
-
- Fixed fee software license revenues were $9.3 million, an increase of $1.4 million, or 18%, compared to $7.9 million.
- Variable fee software license revenues were $8.6 million, an increase of $2.8 million, or 46%, compared to $5.8 million.
- Sales of other products were $0.3
million, with no change from the prior period.
- Cost of revenues of $1.3 million,
an increase of $0.3 million, or 31%,
compared to $1.0 million. As a
percentage of revenues, cost of revenues was unchanged at 7%.
- Total operating expenses of $12.0
million, which includes cost of revenues, an increase of
$1.9 million, or 18%, compared to
$10.1 million. As a percentage of
revenues, operating expenses decreased to 65% compared to 72%.
- Pre-tax net income of $6.6
million, an increase of $2.7
million, or 68%, compared to $3.9
million.
- Income tax expense of $1.7
million, or an effective tax rate of 25%, compared to
$0.6 million, or an effective tax
rate of 15%.
- Net income of $5.0 million, or
$0.74 per basic share and
$0.63 per diluted share, an increase
of $1.6 million, or 48%, compared to
$3.4 million, or $0.50 per basic share and $0.41 per diluted share.
Semler Scientific's two largest customers (including their
affiliates) comprised 40.9% and 33.5% of first quarter revenues in
2023.
OTHER SIGNIFICANT EVENT
In late March 2023, the Centers
for Medicare & Medicaid Services (CMS) issued the final
2024 rate announcement with payment changes for the Medicare
Advantage and Part D prescription drug programs. Essentially, CMS
is phasing in a new Medicare Advantage risk adjustment model
(2024 model) from the previous model (2020 model) over a three-year
period. The 2024 model does not include risk adjusted payments
for peripheral arterial disease (PAD) without complications, which
payments many health insurers relied upon for their Medicare
Advantage patients in the 2020 model. The changes will be phased in
as follows: in calendar year 2023, full payment under the 2020
model; in calendar year 2024, 67% of the 2020 model; in
calendar year 2025, 33% of the 2020 model.
Notice of Conference Call
Semler Scientific will host a conference call today at
4:30 p.m. ET. The call will address
results of the first quarter ended March 31,
2023, as well as provide a business update on Semler
Scientific's market outlook and strategies for the near-term
future.
Participants are encouraged to pre-register for the conference
call using the following link:
https://dpregister.com/sreg/10177436/f8f3c160f0. Callers
who pre-register will be given a conference passcode and unique PIN
to gain immediate access to the call and bypass the live operator.
Participants may pre-register at any time, including up to and
after the call start time. Those without internet access or who are
unable to pre-register may dial in by calling:
Domestic callers: (866) 777–2509
International callers: (412) 317–5413
Please specify to the operator that you would like to join the
"Semler Scientific Call." The conference call will be archived on
Semler Scientific's website at www.semlerscientific.com.
Semler
Scientific, Inc.
|
Statements of
Income
|
Unaudited
|
(In thousands of U.S.
Dollars, except for share and per share data)
|
|
|
|
For the three months ended
March 31,
|
|
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
18,206
|
|
$
|
14,016
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
1,269
|
|
|
970
|
|
Engineering and product development
|
|
|
1,630
|
|
|
1,126
|
|
Sales and
marketing
|
|
|
5,192
|
|
|
4,676
|
|
General
and administrative
|
|
|
3,859
|
|
|
3,302
|
|
Total operating expenses
|
|
|
11,950
|
|
|
10,074
|
|
Income from
operations
|
|
|
6,256
|
|
|
3,942
|
|
Interest
income
|
|
|
484
|
|
|
1
|
|
Change in
fair value of notes held for investment
|
|
|
(107)
|
|
|
—
|
|
Other income, net
|
|
|
377
|
|
|
1
|
|
Pre-tax net
income
|
|
|
6,633
|
|
|
3,943
|
|
Income tax
provision
|
|
|
1,664
|
|
|
583
|
|
Net income
|
|
$
|
4,969
|
|
$
|
3,360
|
|
Net income per share,
basic
|
|
$
|
0.74
|
|
$
|
0.50
|
|
Weighted average number
of shares used in computing basic income
per share
|
|
|
6,701,199
|
|
|
6,777,950
|
|
Net income per share,
diluted
|
|
$
|
0.63
|
|
$
|
0.41
|
|
Weighted average number
of shares used in computing diluted income
per share
|
|
|
7,896,043
|
|
|
8,116,456
|
|
Semler
Scientific, Inc.
|
Balance
Sheets
|
Unaudited
|
(In thousands of
U.S. Dollars)
|
|
|
|
March 31,
|
|
December 31,
|
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
|
Cash and
cash equivalents
|
|
$
|
5,305
|
|
$
|
23,014
|
Short-term
investments
|
|
|
37,663
|
|
|
20,073
|
Trade
accounts receivable, net of allowance for doubtful accounts of $154
and $109,
respectively
|
|
|
9,343
|
|
|
3,884
|
Inventory,
net
|
|
|
512
|
|
|
469
|
Prepaid
expenses and other current assets
|
|
|
2,769
|
|
|
1,468
|
Total
current assets
|
|
|
55,592
|
|
|
48,908
|
Assets for lease,
net
|
|
|
2,873
|
|
|
2,478
|
Property and equipment,
net
|
|
|
703
|
|
|
667
|
Long-term
investments
|
|
|
821
|
|
|
821
|
Notes held for
investment (includes measured at fair value of $4,072 and
$3,679,
respectively)
|
|
|
5,072
|
|
|
4,679
|
Other non-current
assets
|
|
|
2,818
|
|
|
2,842
|
Long-term deferred tax
assets
|
|
|
2,378
|
|
|
2,298
|
Total
assets
|
|
$
|
70,257
|
|
$
|
62,693
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
298
|
|
$
|
835
|
Accrued
expenses
|
|
|
7,206
|
|
|
4,748
|
Deferred
revenue
|
|
|
1,286
|
|
|
1,160
|
Other
short-term liabilities
|
|
|
128
|
|
|
114
|
Total
current liabilities
|
|
|
8,918
|
|
|
6,857
|
|
|
|
|
|
|
|
Long-term
liabilities:
|
|
|
|
|
|
|
Other long-term
liabilities
|
|
|
138
|
|
|
160
|
Total long-term
liabilities
|
|
|
138
|
|
|
160
|
Commitments and
contingencies
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Common
stock, $0.001 par value; 50,000,000 shares authorized; 6,920,643,
and
6,906,544 shares issued, and 6,706,221 and 6,692,122
shares outstanding (treasury
shares of 214,422 and 214,422),
respectively
|
|
|
7
|
|
|
7
|
Additional
paid-in capital
|
|
|
17,005
|
|
|
16,449
|
Retained
earnings
|
|
|
44,189
|
|
|
39,220
|
|
|
|
|
|
|
|
Total
stockholders' equity
|
|
|
61,201
|
|
|
55,676
|
|
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
|
$
|
70,257
|
|
$
|
62,693
|
Semler
Scientific, Inc.
|
Statements of Cash
Flows
|
Unaudited
|
(In thousands of
U.S. Dollars)
|
|
|
|
Three months ended March 31,
|
|
|
2023
|
|
2022
|
CASH FLOWS FROM OPERATING
ACTIVITIES:
|
|
|
|
|
|
|
Net income
|
|
$
|
4,969
|
|
$
|
3,360
|
|
|
|
|
|
|
|
Reconciliation of Net
Income to Net Cash Provided by Operating Activities:
|
|
|
|
|
|
|
Depreciation
|
|
|
129
|
|
|
155
|
Deferred
tax (income) expense
|
|
|
(80)
|
|
|
179
|
Loss on
disposal of assets for lease
|
|
|
78
|
|
|
74
|
Allowance
for doubtful accounts
|
|
|
48
|
|
|
21
|
Change in
fair value of notes held for investment
|
|
|
107
|
|
|
—
|
Gain on
short-term investments
|
|
|
(305)
|
|
|
—
|
Stock-based compensation
|
|
|
702
|
|
|
628
|
Changes in Operating
Assets and Liabilities:
|
|
|
|
|
|
|
Trade
accounts receivable
|
|
|
(5,507)
|
|
|
(1,818)
|
Inventory
|
|
|
(43)
|
|
|
(45)
|
Prepaid
expenses and other current assets
|
|
|
(1,301)
|
|
|
(1,988)
|
Other
non-current assets
|
|
|
25
|
|
|
19
|
Accounts
payable
|
|
|
(537)
|
|
|
(68)
|
Accrued
expenses
|
|
|
2,458
|
|
|
946
|
Other
current and non-current liabilities
|
|
|
118
|
|
|
39
|
Net Cash Provided by Operating
Activities
|
|
|
861
|
|
|
1,502
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES:
|
|
|
|
|
|
|
Additions
to property and equipment
|
|
|
(95)
|
|
|
(122)
|
Proceeds
from maturities of short-term investments
|
|
|
20,211
|
|
|
—
|
Purchase
of short-term investments
|
|
|
(37,496)
|
|
|
—
|
Purchase
of notes held for investment
|
|
|
(500)
|
|
|
—
|
Purchase
of assets for lease
|
|
|
(544)
|
|
|
(134)
|
Net Cash Used in Investing
Activities
|
|
|
(18,424)
|
|
|
(256)
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES:
|
|
|
|
|
|
|
Taxes paid
related to net settlement of equity awards
|
|
|
(146)
|
|
|
(106)
|
Treasury
stock acquired
|
|
|
—
|
|
|
(99)
|
Proceeds
from exercise of stock options
|
|
|
—
|
|
|
62
|
Net Cash Used in Financing
Activities
|
|
|
(146)
|
|
|
(143)
|
(DECREASE) INCREASE IN CASH
|
|
|
(17,709)
|
|
|
1,103
|
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD
|
|
|
23,014
|
|
|
37,323
|
CASH AND CASH EQUIVALENTS, END OF
PERIOD
|
|
$
|
5,305
|
|
$
|
38,426
|
About Semler Scientific, Inc.:
Semler Scientific, Inc. develops, manufactures and markets
innovative products and services that assist in evaluating and
treating chronic diseases. Its flagship product, QuantaFlo®, which
is patented and cleared by the U.S. Food and Drug Administration
(FDA), is a rapid point-of-care test that measures arterial blood
flow in the extremities. The QuantaFlo® test aids in the diagnosis
of cardiovascular diseases, such as peripheral arterial disease
(PAD) and heart dysfunction (HD). QuantaFlo® is used by healthcare
providers to evaluate their patient's risk of mortality and major
adverse cardiovascular events (MACE). In addition, Semler
Scientific has an agreement with Mellitus Health, Inc. (Mellitus)
to exclusively market and distribute Insulin Insights™, an
FDA cleared software product that recommends optimal insulin dosing
for diabetic patients in the United
States, including Puerto
Rico. Semler Scientific has a minority investment in
Mellitus, as well as Monarch Medical Technologies LLC, a privately
held company whose product EndoTool® offers a technological
solution for inpatient glycemic management. Additional information
about Semler Scientific can be found at
www.semlerscientific.com.
Forward-Looking Statements
This press release contains "forward-looking" statements. Such
statements can be identified by, among other things, the use of
forward-looking language such as the words "believe," "goal,"
"may," "will," "intend," "expect," "anticipate," "estimate,"
"project," "would," "could" or words with similar meaning or the
negatives of these terms or by the discussion of strategy or
intentions. The forward-looking statements in this release include
express or implied statements regarding developing business in
heart dysfunction and diabetes; continued testing of asymptomatic
patients; and the benefits of early identification of at-risk
patients; among others. Such forward-looking statements are subject
to a number of risks and uncertainties that could cause Semler
Scientific's actual results to differ materially from those
discussed here, such as whether or not insurance plans and other
customers will continue to license its cardiovascular testing
products, including the risk of changes in the reimbursement
landscape for its customers including related to the recent CMS
rate announcement; whether or not it will be able to successfully
expand its product offering, including into heart dysfunction and
diabetes; whether or not QuantaFlo® can successfully aid
in the diagnosis of heart dysfunction; along with those risk
factors detailed in Semler Scientific's filings with the Securities
and Exchange Commission. These forward-looking statements involve
assumptions, estimates, and uncertainties that reflect current
internal projections, expectations or beliefs. There can be no
assurance that such statements will prove to be accurate, and
actual results and future events could differ materially from those
anticipated in such statements. All forward-looking statements
contained in this press release are qualified in their entirety by
these cautionary statements and the risk factors described above.
Furthermore, all such statements are made as of the date of this
release and Semler Scientific assumes no obligation to update or
revise these statements unless otherwise required by law.
INVESTOR CONTACT:
Susan A. Noonan
S.A. Noonan Communications
susan@sanoonan.com
917 513 5303
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SOURCE Semler Scientific, Inc.