- Q4 Financial Highlights 2020 vs 2019:
- Total revenue was $18.6 million ▪ Total software-related
revenue was $18.6 million, up from $18.4 million
- Total gross margin increased to 61% from 58%
- Full-Year Financial Highlights 2020 vs 2019:
- Total revenue was $73.2 million vs $77.4 million ▪ Total
software-related revenue was $73.0 million, up from $72.8
million
- Total gross margin increased to 60% from 56%
- Completed sale of Connected Care Business for $47.25 million in
February 2020
- Acquired The OpenNMS Group, an open source network monitoring
company, in July 2020
NantHealth, Inc. (NASDAQ-GS: NH), a provider of enterprise
solutions that help transform complex data into actionable
insights, today reported financial results for its fourth quarter
and full year ended December 31, 2020.
“While managing our business through the challenges associated
with COVID-19 for most of the past year, we advanced our goal of
expanding and diversifying NantHealth's software portfolio and
services offerings with the acquisition of OpenNMS, continued to
invest in our data solutions and AI capabilities, and delivered
expanded capabilities on our NaviNet and Eviti SaaS products,” said
Ron Louks, Chief Operating Officer, NantHealth. “In addition, as
part of our NantHealth Cares initiative, we supported healthcare
providers and medical staff by offering, at no cost for the entire
month of May, our NaviNet AllPayer platform to providers. I am
pleased to report that even with a month of free access, AllPayer
revenues grew in 2020 and added more than 1,500 providers to its
network."
Software and Services Q4 Highlights:
- Clinical Decision Support (Eviti®):
- Signed a renewal agreement with a Maryland-based health plan
for an additional three years, and expanded products and services
within the plan
- Continued to expand Eviti Connect across the Medicaid
population of a leading U.S. health insurance company. Of the 13
states originally announced, eight states have gone live through
the fourth quarter of 2020
- Launched Eviti Connect 8.2 which included:
- Formulary Redirection ‒ a major expansion of our Treatment
Warning and Deviation (TWAD) feature that allows redirection to
preferred drugs. This new functionality scales the payer’s ability
to enable formulary redirection resulting in significant savings in
delivery of care
- Smart Justifications ‒ uses Eviti proprietary algorithms to
identify characteristics of cancer type and treatment goals that
streamline workflow and result in faster time to treatment
plan
- Payer Engagement (NaviNet®):
- Signed a three-year renewal agreement for NaviNet Open with one
of the nation’s leading Medicaid managed care organizations,
strengthening a nearly 20-year partnership
- Launched a collaboration with Sesame, Inc. that enables
providers to utilize Sesame’s payment tools giving patients direct
access to affordable, high-quality care while increasing practice
revenue
- Introduced new network analytics solutions focused on providing
our health plan partners with actionable insights into their
providers’ NaviNet activity:
- Document Exchange Insights Reports ‒ provide information on
utilization trends, reach into the provider network, and identify
opportunities for targeted action to drive greater adoption
- Advanced user behavior analytics and user engagement tools ‒
influence the NaviNet product roadmap and augment existing analysis
available to our health plans and partners
- Enhanced Open Authorizations to more seamlessly inform
providers on where and how to request service approval from their
patient’s health plan
Network Monitoring and Management (OpenNMS®)
- Deployed the OpenNMS flows and streaming analytics solution
(300,000 flows per second) in production at a Fortune 500 energy
company; decommissioning and replacing their existing solution
- Released OpenNMS Horizon 27.0, which introduced digital
experience monitoring for in depth monitoring of applications from
the vantage point of individual end users and support for
OpenConfig, a new industry standard that enables direct streaming
of device telemetry data
Precision Medicine and Artificial Intelligence -
Highlights:
- In December, NantHealth presented significant treatment
insights at the 2020 San Antonio Breast Cancer Symposium around the
adoption of trastuzumab biosimilars in the treatment of
HER2-positive breast cancer and the potential clinical and cost
benefits of biosimilars. By examining Eviti data, the study
identified an opportunity for payers to successfully redirect
providers to biosimilars that offer high-value care at lower
costs
- In November, NantHealth and ImmunityBio announced the
publication in Nature’s Scientific Reports of a study that revealed
RNA sequencing is not only viable but may also provide significant
clinical value in analyzing a cancer patient’s specific disease
biology to enable an optimized treatment decision with a higher
likelihood of success
- In October, NantHealth, ImmunityBio and NantOmics presented
results at the 2020 American Association for Cancer Research
Virtual Special Conference on the use of deep-learning models in
providing significant risk-assessment of survival in pancreatic
cancer patients, holding promise as a prognostic technology
Business and Financial Highlights
For the 2020 fourth quarter:
- Total net revenue was $18.6 million, up slightly from $18.6
million in the 2019 fourth quarter.
- Gross profit increased to $11.4 million, or 61% of total net
revenue, compared with $10.8 million, or 58% of total net revenue,
for the prior year period.
- Selling, general and administrative (SG&A) expenses
declined to $11.7 million from $12.8 million in the 2019 fourth
quarter, mainly driven by ongoing cost management efforts and
efficiencies in overall processes.
- Research and development (R&D) expenses increased to $4.8
million from $3.4 million mainly from the Company's ongoing
investments in expanding its data and AI capabilities.
- Net loss from continuing operations attributable to NantHealth,
net of tax, was $20.1 million, or $0.18 per share, which includes a
noncash charge related to the Allscripts Bookings Commitment of
$8.1 million. This compares with net loss from continuing
operations attributable to NantHealth, net of tax, of $13.2
million, or $0.12 per share, for the 2019 fourth quarter.
- On a non-GAAP basis, net loss from continuing operations
attributable to NantHealth was $6.2 million, or $0.06 per share,
compared with $5.7 million, or $0.05 per share, for the fourth
quarter of last year.
For the 2020 full year:
- Total net revenue was $73.2 million. This compares with total
net revenue of $77.4 million for the 2019 full year, which included
$2.9 million of home healthcare services revenue, a business the
company divested in June 2019.
- Gross profit increased to $43.9 million, or 60% of total net
revenue, from $43.3 million, or 56% of total net revenue, for the
prior year.
- SG&A expense declined substantially to $48.5 million from
$55.6 million in 2019, driven by the divestiture of the home
healthcare services business, continued efforts to reduce costs and
maximize existing resources. R&D expense increased to $17.3
million from $13.9 million in 2019 mainly from ongoing investments
in data and AI capabilities.
- Net loss from continuing operations attributable to NantHealth,
net of tax, was $88.3 million, or $0.80 per share, which includes
noncash charges related to the Allscripts Bookings Commitment of
$11.2 million and the impairment of the Company's equity method
investment in NantOmics of $28.2 million. This compares with net
loss from continuing operations attributable to NantHealth, net of
tax, of $65.4 million, or $0.59 per share, for the 2019 full
year.
- On a non-GAAP basis, net loss from continuing operations
attributable to NantHealth was $27.0 million, or $0.24 per share,
down from $30.1 million, or $0.27 per share, for 2019.
At December 31, 2020, cash and cash equivalents totaled $22.8
million.
Conference Call Information and Forward-Looking
Statements
Later today, the company will host a conference call at 1:30
p.m. PT (4:30 p.m. ET) to review its results of operations for the
fourth quarter and full year ended December 31, 2020. The
conference call will be available to interested parties by dialing
844-309-3709 from the U.S. or Canada, or 281-962-4864 from
international locations, passcode 9786375. The call will be
broadcast via the Internet at www.nanthealth.com. Listeners are
encouraged to visit the website at least 10 minutes prior to the
start of the scheduled presentation to register, download and
install any necessary audio software. A playback of the call will
be archived and accessible on the same website for at least three
months.
Discussion during the conference call may include
forward-looking statements regarding topics such as the company’s
financial status and performance, regulatory and operational
developments, and other comments the company may make about its
future plans or prospects in response to questions from
participants on the conference call.
Use of Non-GAAP Financial Measures
This news release contains references to Non-GAAP financial
measures, including adjusted net loss and adjusted net loss per
share, which are financial measures that are not prepared in
conformity with United States generally accepted accounting
principles (U.S. GAAP). The Company’s management believes that the
presentation of Non-GAAP financial measures provides useful
supplementary information regarding operational performance,
because it enhances an investor’s overall understanding of the
financial results for the Company’s core business. Additionally, it
provides a basis for the comparison of the financial results for
the Company’s core business between current, past and future
periods. Other companies may define these measures in different
ways. Non-GAAP financial measures should be considered only as a
supplement to, and not as a substitute for or as a superior measure
to, financial measures prepared in accordance with U.S. GAAP.
Non-GAAP per share numbers are calculated based on one class of
common stock and do not incorporate the effects, if any, of using
the two-class method.
About NantHealth, Inc.
NantHealth, a member of the NantWorks ecosystem of companies,
provides enterprise solutions that help businesses transform
complex data into actionable insights. By offering efficient ways
to move, interpret, and visualize complex and highly sensitive
information, NantHealth enables customers in healthcare, life
sciences, logistics, telecommunications and other industries to
automate, understand and act on data while keeping it secure and
scalable. NantHealth’s product portfolio comprises the latest
technology in payer/provider collaboration platforms for real-time
coverage decision support (Eviti and NaviNet), molecular analysis
(GPS Cancer), and data solutions that provide multi-data analysis,
reporting and professional services offerings (Quadris). OpenNMS, a
NantHealth subsidiary, helps businesses monitor and manage network
health and performance. For more information, visit nanthealth.com,
follow us on Twitter, Facebook and LinkedIn, and subscribe to our
blog.
This news release contains certain statements of a
forward-looking nature relating to future events or future business
performance. Forward-looking statements can be identified by the
words “expects,” “anticipates,” “believes,” “intends,” “estimates,”
“plans,” “will,” “outlook” and similar expressions. Forward-looking
statements are based on management’s current plans, estimates,
assumptions and projections, and speak only as of the date they are
made. Risks and uncertainties include, but are not limited to: our
ability to successfully integrate our systems and solutions to
address a wide range of healthcare issues; our ability to
successfully amass the requisite data to achieve maximum network
effects; appropriately allocating financial and human resources
across a broad array of product and service offerings; raising
additional capital as necessary to fund our operations; achieving
significant commercial market acceptance for our solutions;
establishing relationships with key thought leaders or key decision
makers in order to attract, retain and renew partners and clients
and obtain reimbursement for our sequencing and molecular analysis
solutions; our ability to grow the market for our solutions;
successfully enhancing our solutions to achieve market acceptance
and keep pace with technological developments; customer
concentration; competition; security breaches; data loss or
corruption due to failures or errors in our systems and service
disruptions at our data centers; bandwidth limitations; our ability
to use, disclose, de-identify or license data and to integrate
third-party technologies; our use of “open source” software; our
ability to continue our relationship with NantOmics; our ability to
obtain regulatory approvals; dependence upon senior management; the
need to comply with and meet applicable laws and regulations;
unexpected adverse events; clinical adoption and market acceptance
of our molecular sequencing and analysis solutions; and anticipated
cost savings. We undertake no obligation to update any
forward-looking statement in light of new information or future
events, except as otherwise required by law. Forward-looking
statements involve inherent risks and uncertainties, most of which
are difficult to predict and are generally beyond our control.
Actual results or outcomes may differ materially from those implied
by the forward-looking statements as a result of the impact of a
number of factors, many of which are discussed in more detail in
our reports filed with the Securities and Exchange Commission..
NantHealth, Inc.
Consolidated Balance
Sheets
(Dollars in thousands, except per
share amounts)
(Unaudited)
December 31,
2020
2019
Assets
Current assets
Cash and cash equivalents
$
22,787
$
5,243
Accounts receivable, net
3,273
6,179
Related party receivables, net
1,031
823
Prepaid expenses and other current
assets
3,504
19,341
Current assets of discontinued
operations
—
6,327
Total current assets
30,595
37,913
Property, plant, and equipment, net
13,102
14,985
Goodwill
98,333
97,307
Intangible assets, net
47,969
51,848
Investment in related party
—
31,702
Related party receivable, net of
current
823
1,108
Operating lease right-of-use assets
7,539
8,470
Other assets
1,927
1,818
Noncurrent assets of discontinued
operations
—
21,336
Total assets
$
200,288
$
266,487
Liabilities and Stockholders'
Equity
Current liabilities
Accounts payable
$
5,122
$
3,377
Accrued and other current liabilities
13,975
31,988
Deferred revenue
1,166
7,098
Related party payables, net
4,238
4,120
Notes payable
268
238
Related party convertible note, net
9,411
—
Convertible notes, net
90,578
—
Current liabilities of discontinued
operations
—
10,680
Total current liabilities
124,758
57,501
Deferred revenue, net of current
393
1,129
Related party liabilities
31,091
24,227
Related party promissory note
112,666
112,666
Related party convertible note, net
—
8,864
Convertible notes, net
—
84,648
Deferred income taxes, net
1,853
1,669
Operating lease liabilities
8,170
9,728
Other liabilities
32,757
21,542
Noncurrent liabilities of discontinued
operations
—
1,649
Total liabilities
311,688
323,623
Stockholders' deficit
Common stock, $0.0001 par value per share,
750,000,000 shares authorized; 111,284,733 and 110,619,678 shares
issued and outstanding at December 31, 2020 and 2019,
respectively
11
11
Additional paid-in capital
891,583
889,955
Accumulated deficit
(1,003,210)
(946,884)
Accumulated other comprehensive loss
(168)
(218)
Total NantHealth stockholders' deficit
(111,784)
(57,136)
Noncontrolling interests
384
—
Total stockholders' deficit
(111,400)
(57,136)
Total liabilities and stockholders'
deficit
$
200,288
$
266,487
NantHealth, Inc.
Consolidated Statements of
Operations
(Dollars in thousands, except per
share amounts)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2020
2019
2020
2019
Revenue
Software-as-a-service related
$
18,201
$
18,410
$
72,198
$
72,831
Maintenance
378
—
677
—
Professional services
24
—
86
—
Total software-related revenue
18,603
18,410
72,961
72,831
Sequencing and molecular analysis
39
152
211
1,733
Home health care services
—
—
—
2,863
Total net revenue
18,642
18,562
73,172
77,427
Cost of Revenue
Software-as-a-service related
5,504
6,096
23,056
23,100
Maintenance
230
69
361
357
Professional services
1
—
16
—
Amortization of developed technologies
1,247
1,143
4,755
4,662
Total software-related cost of revenue
6,982
7,308
28,188
28,119
Sequencing and molecular analysis
211
480
1,038
4,546
Home health care services
—
—
—
1,471
Total cost of revenue
7,193
7,788
29,226
34,136
Gross Profit
11,449
10,774
43,946
43,291
Operating Expenses
Selling, general and administrative
11,670
12,752
48,534
55,595
Research and development
4,828
3,431
17,274
13,934
Amortization of acquisition-related
assets
985
1,054
3,676
4,216
Impairment of intangible assets, including
internal-use software
729
—
729
3,977
Total operating expenses
18,212
17,237
70,213
77,722
Loss from operations
(6,763)
(6,463)
(26,267)
(34,431)
Interest expense, net
(4,908)
(4,601)
(19,199)
(18,044)
Other expense, net
(8,274)
(585)
(10,824)
(5,607)
Loss from related party equity method
investment
—
(1,916)
(31,702)
(8,317)
Loss from continuing operations before
income taxes
(19,945)
(13,565)
(87,992)
(66,399)
Provision for (benefit from) income
taxes
273
(359)
447
(1,018)
Net loss from continuing operations
(20,218)
(13,206)
(88,439)
(65,381)
Income from discontinued operations, net
of tax attributable to NantHealth
38
1,457
31,993
2,619
Net loss
(20,180)
(11,749)
(56,446)
(62,762)
Net loss attributable to noncontrolling
interests
(78)
—
(120)
—
Net loss attributable to NantHealth
$
(20,102)
$
(11,749)
$
(56,326)
$
(62,762)
Basic and diluted net loss per share
attributable to NantHealth:
Continuing operations - common stock
$
(0.18)
$
(0.12)
$
(0.80)
$
(0.59)
Discontinued operations - common stock
$
—
$
0.01
$
0.29
$
0.02
Total net loss per share - common
stock
$
(0.18)
$
(0.11)
$
(0.51)
$
(0.57)
Weighted average shares
outstanding
Basic and diluted - common stock
111,238,540
110,619,780
110,954,858
110,351,638
NantHealth, Inc.
Non-GAAP Net Loss from
Continuing Operations Attributable to NantHealth and Non-GAAP Net
Loss Per Share from Continuing Operations Attributable to
NantHealth
(Dollars in thousands, except per
share amounts)
(Unaudited)
Three Months Ended December
31,
Year Ended December
31,
2020
2019
2020
2019
Net loss from continuing operations
attributable to NantHealth
$
(20,140)
$
(13,206)
$
(88,319)
$
(65,381)
Adjustments to GAAP net loss from
continuing operations attributable to NantHealth:
Loss from related party equity method
investment
—
1,916
31,702
8,317
Stock-based compensation expense from
continuing operations
961
1,566
2,722
2,842
Change in fair value of derivatives
liability
(3)
—
4
—
Change in fair value of Bookings
Commitment
8,098
372
11,168
5,036
Noncash interest expense related to
convertible notes
1,698
1,495
6,477
5,702
Intangible amortization from continuing
operations
2,212
2,197
8,395
8,878
Impairment of intangible assets, including
internal-use software
729
—
729
3,977
Loss on sale of business
—
—
—
582
Securities litigation costs
—
28
(103)
528
Tax provision (benefit) resulting from
certain noncash tax items
244
(51)
228
(570)
Total adjustments to GAAP net loss from
continuing operations attributable to NantHealth
13,939
7,523
61,322
35,292
Net loss from continuing operations
attributable to NantHealth - Non-GAAP
$
(6,201)
$
(5,683)
$
(26,997)
$
(30,089)
Weighted average basic common shares
outstanding
111,238,540
110,619,780
110,954,858
110,351,638
Net loss per common share from
continuing operations attributable to NantHealth - Non-GAAP
$
(0.06)
$
(0.05)
$
(0.24)
$
(0.27)
Reconciliation of Net Loss per Common
Share from Continuing Operations Attributable to NantHealth to Net
Loss per Common Share from Continuing Operations Attributable to
NantHealth - Non-GAAP (Unaudited):
Three Months Ended December
31,
Year Ended December
31,
2020
2019
2020
2019
Net loss per common share from continuing
operations attributable to NantHealth
$
(0.18)
$
(0.12)
$
(0.80)
$
(0.59)
Adjustments to GAAP net loss per common
share from continuing operations attributable to NantHealth:
Loss from related party equity method
investment
—
0.03
0.29
0.07
Stock-based compensation expense from
continuing operations
0.01
0.01
0.02
0.03
Change in fair value of derivatives
liability
—
—
—
—
Change in fair value of Bookings
Commitment
0.07
—
0.10
0.05
Noncash interest expense related to
convertible notes
0.01
0.01
0.06
0.05
Intangible amortization from continuing
operations
0.02
0.02
0.08
0.08
Impairment of intangible assets, including
internal-use software
0.01
—
0.01
0.04
Loss on sale of business
—
—
—
0.01
Securities litigation costs
—
—
—
—
Tax provision (benefit) resulting from
certain noncash tax items
—
—
—
(0.01)
Total adjustments to GAAP net loss per
common share from continuing operations attributable to
NantHealth
0.12
0.07
0.56
0.32
Net loss per common share from
continuing operations attributable to NantHealth - Non-GAAP
$
(0.06)
$
(0.05)
$
(0.24)
$
(0.27)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210225005914/en/
Investor Contact: Robert Jaffe rjaffe@rjaffeco.com
424.288.4098
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