CARERX CORPORATION Delivered Third Consecutive Quarter-Over-Quarter Growth in Adjusted EBITDA
"In 2023 we made tremendous progress to deliver on our operational optimization program and further strengthen our financial position," said
Highlights for the Fourth Quarter of 2023
- Revenue for the quarter was
$91.1 million as compared to$93.8 million for the third quarter of 2023 and$94.3 million for the fourth quarter of 2022:- Decrease compared to the prior quarter was mainly due to a net reduction in the average number of beds serviced; and
- Decrease compared to the same period in the prior year was primarily driven by a change in the mix of branded and generic pharmaceuticals dispensed, which did not negatively impact the Company's profitability in the quarter.
- Adjusted EBITDA1 for the quarter was
$7 .5 million as compared to$7 .3 million for the third quarter of 2023 and$7 .1 million for the fourth quarter of 2022:- Increase to previous quarter and the same period in the prior year was due to certain efficiencies and cost savings initiatives implemented during the second half of 2023.
- Net loss for the quarter was
$3.7 million as compared to net loss$1.4 million for the third quarter of 2023 and net loss of$4.7 million for the fourth quarter of 2022:- Increase compared to the prior quarter was mainly due to a non-cash adjustment related to loss on financial liability extinguishment recorded as part of the refinancing transaction and a net reduction in the average number of beds serviced; and
- Decline in net loss as compared to the same period in the prior year was driven primarily by decreases in share-based compensation expense, the loss on the change in fair value of contingent consideration liabilities, and the impact of certain cost savings initiatives implemented during the second half of 2023; partially offset by a lower gain on the change in fair value of derivative financial instruments and intangible assets impairment recorded during the fourth quarter of 2023.
- On
December 21, 2023 , the Company entered into a comprehensive refinancing transaction led by a Canadian Schedule I chartered bank and arranged and managed byCrown Private Credit Partners Inc. ("CPCP"). Under the terms of the refinancing, CPCP provided a senior secured revolving operating loan of up to$20.0 million (the "Operating Loan") and a$50.0 million senior secured term loan (the "Term Loan", and together with the Operating Loan, the "Credit Facilities"), of which$14.0 million and$47.0 million were advanced, respectively, onDecember 21, 2023 with future draws on the Term Loan available to fund certain capital expenditures; - The proceeds from the Credit Facilities, plus available cash on hand, were used to repay
$78.0 million of existing debt and to redeem the entire aggregate principal of the Ewing Convertible Debentures that otherwise were set to mature onMarch 12, 2024 .
1 See "Non-IFRS Measures" below |
FINANCIAL RESULTS
Selected Financial Information
For the three month periods | For the years ended | |||||
(Thousands of Canadian dollars except per | 2023 | 2022 | 2021 | 2023 | 2022 | 2021 |
$ | $ | $ | $ | $ | $ | |
Revenue | 91,097 | 94,319 | 96,850 | 370,746 | 381,727 | 262,630 |
EBITDA1 | 5,486 | 4,516 | 4,596 | 24,697 | (888) | 8,954 |
Adjusted EBITDA1 | 7,505 | 7,144 | 7,583 | 28,673 | 32,267 | 22,869 |
Per share - Basic | ||||||
Adjusted EBITDA Margin1 | 8.2 % | 7.6 % | 7.8 % | 7.7 % | 8.5 % | 8.7 % |
Net loss | (3,700) | (4,680) | (4,447) | (5,405) | (34,353) | (22,730) |
Per share - Basic and Diluted | ( | ( | ( | ( | ( | ( |
Cash provided by operations | 8,762 | 14,190 | 2,698 | 27,375 | 22,333 | 7,269 |
Total Assets | 231,893 | 264,535 | 282,816 | 231,893 | 264,535 | 282,816 |
Total Liabilities | 150,367 | 200,078 | 200,529 | 150,367 | 200,078 | 200,529 |
1 See "Non-IFRS Measures" below. |
Conference Call
The Company will host a conference call, including a slide presentation, to discuss its fourth quarter of 2023 and the full year ended
Telephone Dial-In Access Information
To join the conference call without operator assistance, you may register and enter your phone number at https://emportal.ink/42SSLil to receive an instant automated call.
To dial direct and enter the call through an operator, dial 416-764-8659 or 1-888-664-6392. Please connect approximately 15 minutes prior to the beginning of the call to ensure participation. Those participating in the conference call by telephone can view the slide presentation by accessing the online webcast (see instructions below) and choosing the Non-Streaming Audio option.
Webcast Access Information
A live webcast of the conference call, including the slide presentation, will be available on the Events and Presentations page of the Investors section of the Company's website (https://carerx.ca/presentations/). Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. To view the webcast presentation with slides, please choose either the Real Streaming Audio or Windows Streaming Audio option.
The webcast with slide presentation will be archived for 90 days on the Events and Presentations page of the Investors section of the Company's website (https://carerx.ca/presentations/).
About
Forward-Looking Statements
This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding the Company's business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate" or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management.
Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated by such statements. Factors that could cause such differences include the Company's general business risks, the Company's exposure to and reliance on government regulation and funding, risks related to employee recruitment and retention, the Company's liquidity and capital requirements, exposure to epidemic or pandemic outbreak, reliance on contracts with key care operators and other risk factors described from time to time in the reports and disclosure documents filed by the Company with Canadian securities regulatory agencies and commissions. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. As a result of the foregoing and other factors, no assurance can be given as to any such future results, levels of activity or achievements and neither the Company nor any other person assumes responsibility for the accuracy and completeness of these forward-looking statements. The factors underlying current expectations are dynamic and subject to change.
Non-IFRS Measures
This press release includes certain measures which have not been prepared in accordance with IFRS such as "EBITDA", "Adjusted EBITDA", "Adjusted EBITDA Margin" and "Adjusted EBITDA per share". These non-IFRS measures are not recognized under IFRS and, accordingly, shareholders are cautioned that these measures should not be construed as alternatives to net income determined in accordance with IFRS. The non-IFRS measures presented are unlikely to be comparable to similar measures presented by other issuers.
The Company defines "EBITDA" as earnings before depreciation and amortization, finance costs, net, and income tax expense (recovery). "Adjusted EBITDA" is defined as EBITDA before transaction, restructuring and other costs, change in fair value of contingent consideration liability, impairments, change in fair value of derivative financial instruments, change in fair value of investment, loss on disposal of property and equipment and share-based compensation expense. "Adjusted EBITDA Margin" is defined as Adjusted EBITDA divided by revenue. "Adjusted EBITDA per share" is defined as Adjusted EBITDA divided by the weighted average outstanding shares. The Company believes that Adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations which the Company can use to fund working capital requirements, service interest and principal debt repayments and fund future growth initiatives. The Company's agreements with lenders are also structured with certain financial performance covenants which includes Adjusted EBITDA as a key component of the covenant calculation. EBITDA and Adjusted EBITDA are not recognized measures under IFRS.
Reconciliation of Non-IFRS Measures
For the three month | For the years ended | |||
2023 | 2022 | 2023 | 2022 | |
(Thousands of Canadian Dollars except per share | $ | $ | $ | $ |
Net loss | (3,700) | (4,680) | (5,405) | (34,353) |
Depreciation and amortization | 4,946 | 5,221 | 19,976 | 20,065 |
Finance costs, net | 4,413 | 3,508 | 14,316 | 14,943 |
Income tax expense (recovery) | (173) | 467 | (4,190) | (1,543) |
EBITDA | 5,486 | 4,516 | 24,697 | (888) |
Transaction, restructuring and other costs | 633 | 697 | 1,445 | 4,998 |
Change in fair value of contingent consideration liability | 18 | 541 | 230 | 1,872 |
710 | — | 710 | 24,330 | |
Share-based compensation expense | 449 | 1,602 | 1,471 | 4,569 |
Change in fair value of derivative financial instruments | — | (221) | (281) | (5,576) |
Change in fair value of investment | — | — | — | 2,713 |
Loss on disposal of assets | 209 | 9 | 401 | 249 |
Adjusted EBITDA | 7,505 | 7,144 | 28,673 | 32,267 |
Weighted average number of shares - basic and diluted | 58,636 | 49,257 | 57,350 | 47,596 |
Adjusted EBITDA per share - basic | ||||
SOURCE
© Canada Newswire, source
