Phreesia, Inc. (NYSE: PHR) (“Phreesia”) announced financial
results today for the fiscal first quarter ended April 30,
2021.
"We carried the momentum of the strong finish to our fiscal year
2021 into the first quarter of fiscal 2022. As we look ahead, we’re
excited to continue providing health systems, hospitals and
ambulatory providers with tools that will help them optimize their
performance and improve the patient experience,” said Phreesia CEO
Chaim Indig.
Fiscal First Quarter 2022 Highlights
- Revenue was $48.3 million in the quarter as compared to $33.4
million in the same period in the prior year, an increase of
45%.
- Average number of provider clients was 1,902 in the quarter as
compared to 1,632 in the same period in the prior year, an increase
of 17%.
- Average revenue per provider client was $20,222 in the quarter
compared to $16,735 in the same period in the prior year, an
increase of 21%.
- Adjusted EBITDA was positive $0.1 million in the quarter
compared to positive $1.5 million in the same period in the prior
year.
- Cash and cash equivalents as of April 30, 2021 was $450.7
million, an increase of $231.9 million compared to January 31,
2021, driven primarily by our follow-on offering of common stock,
which generated net proceeds of $245.8 million.
Outlook for Fiscal 2022
We are increasing our revenue outlook for fiscal 2022 to a range
of $191 million to $194 million from the previous range of $178
million to $186 million. We continue to expect our overall cash
outflow to increase in fiscal 2022 compared to fiscal 2021 as we
continue to ramp up hiring and infrastructure across the
organization to support our anticipated growth.
Conference Call Information
The Company will hold a conference call on Friday, June 4, 2021,
at 8:30 a.m. Eastern Time to review the Company’s first fiscal
quarter financial results. To participate in the Company’s live
conference call and webcast, please dial (866) 211-4557 (or (647)
689-6750 for international participants) using conference code
number 3966898 or visit the “Events & Presentations” section of
ir.phreesia.com. A replay of the call will be available via webcast
for on-demand listening shortly after the completion of the call,
at the same web link, and will remain available for approximately
90 days.
Recent Events
COVID-19
The impact of the COVID-19 (a novel strain of coronavirus)
pandemic has been widespread and rapidly evolving. Over the last
six months, several vaccines for COVID-19 received FDA approval and
are currently being administered across the country. To date, more
than a third of Americans are fully vaccinated against the virus.
Despite the promising vaccination rates and many states' reopening
plans, we believe COVID-19 may continue to impact the normal
operations of our clients, which are primarily healthcare
providers. As more individuals are vaccinated, we expect these
impacts to be diminished.
Phreesia, Inc. Consolidated
Balance Sheets (Unaudited) (in thousands, except share and per
share data)
April 30, 2021
January 31, 2021
(unaudited)
Assets
Current:
Cash and cash equivalents
$
450,680
$
218,781
Settlement assets
16,788
15,488
Accounts receivable, net of allowance for
doubtful accounts of $666 and $699 as of April 30, 2021 and January
31, 2021, respectively
29,964
29,052
Deferred contract acquisition costs
1,895
1,693
Prepaid expenses and other current
assets
7,906
7,254
Total current assets
507,233
272,268
Property and equipment, net of accumulated
depreciation and amortization of $43,442 and $40,148 as of April
30, 2021 and January 31, 2021, respectively
25,068
26,660
Capitalized internal-use software, net of
accumulated amortization of $26,998 and $25,476 as of April 30,
2021 and January 31, 2021, respectively
11,225
10,476
Operating lease right-of-use assets
2,497
2,654
Deferred contract acquisition costs
2,438
1,248
Intangible assets, net of accumulated
amortization of $653 and $525 as of April 30, 2021 and January 31,
2021, respectively
2,597
2,725
Deferred tax asset
533
658
Goodwill
8,211
8,307
Other assets
1,401
1,670
Total assets
$
561,203
$
326,666
Liabilities and Stockholders’
Equity
Current:
Settlement obligations
$
16,788
$
15,488
Current portion of debt and finance lease
liabilities
4,103
4,864
Current portion of operating lease
liabilities
1,153
1,087
Accounts payable
313
4,389
Accrued expenses
15,116
18,324
Deferred revenue
13,223
10,838
Total current liabilities
50,696
54,990
Long-term debt and finance lease
liabilities
5,532
6,471
Operating lease liabilities,
non-current
1,701
1,899
Total liabilities
57,929
63,360
Commitments and contingencies
Stockholders’ Equity:
Common stock, $0.01 par value -
500,000,000 shares authorized as of April 30, 2021 and January 31,
2021, respectively; 50,270,229 and 44,880,883 shares issued as of
April 30, 2021 and January 31, 2021, respectively
503
449
Additional paid-in capital
831,632
579,599
Accumulated deficit
(322,751
)
(311,777
)
Treasury stock, at cost, 119,138 and
99,520 shares at April 30, 2021 and January 31, 2021,
respectively
(6,110
)
(4,965
)
Total Stockholders’ Equity
503,274
263,306
Total Liabilities and Stockholders’
Equity
$
561,203
$
326,666
Phreesia, Inc. Consolidated
Statements of Operations (Unaudited) (in thousands, except
share and per share data)
Three months ended April
30,
2021
2020
Revenue:
Subscription and related services
$
21,819
$
15,599
Payment processing fees
16,644
11,707
Life sciences
9,828
6,090
Total revenues
48,291
33,396
Expenses:
Cost of revenue (excluding depreciation
and amortization)
8,534
4,734
Payment processing expense
9,725
6,848
Sales and marketing
15,012
9,434
Research and development
8,054
5,005
General and administrative
12,671
8,720
Depreciation
3,297
2,268
Amortization
1,651
1,353
Total expenses
58,944
38,362
Operating loss
(10,653
)
(4,966
)
Other income (expense), net
66
(715
)
Interest (expense) income, net
(238
)
(320
)
Total other expense, net
(172
)
(1,035
)
Loss before provision for income
taxes
(10,825
)
(6,001
)
Provision for income taxes
(149
)
(111
)
Net loss
$
(10,974
)
$
(6,112
)
Net loss per share attributable to
common stockholders, basic and diluted
$
(0.24
)
$
(0.16
)
Weighted-average common shares
outstanding, basic and diluted
45,416,431
37,308,084
Phreesia, Inc. Consolidated
Statements of Cash Flows (unaudited) (in thousands)
Three Months Ended April
30,
2021
2020
Operating activities:
Net loss
$
(10,974
)
$
(6,112
)
Adjustments to reconcile net loss to net
cash (used in) provided by operating activities:
Depreciation and amortization
4,948
3,621
Stock-based compensation expense
5,774
2,872
Amortization of debt discount
72
126
Cost of Phreesia hardware purchased by
customers
135
172
Deferred contract acquisition cost
amortization
575
525
Non-cash operating lease expense
256
389
Deferred tax asset
125
56
Changes in operating assets and
liabilities:
Accounts receivable
(912
)
(2,245
)
Prepaid expenses and other assets
(809
)
1,614
Deferred contract acquisition costs
(1,967
)
(714
)
Accounts payable
(1,068
)
(998
)
Accrued expenses and other liabilities
(3,678
)
1,871
Lease liability
(335
)
(502
)
Deferred revenue
2,385
1,228
Net cash (used in) provided by
operating activities
(5,473
)
1,903
Investing activities:
Capitalized internal-use software
(2,916
)
(1,160
)
Purchase of property and equipment
(3,983
)
(1,917
)
Net cash used in investing
activities
(6,899
)
(3,077
)
Financing activities:
Proceeds from issuance of common stock in
equity offerings, net of underwriters' discounts and
commissions
245,813
—
Proceeds from issuance of common stock
upon exercise of stock options
1,356
1,736
Treasury stock to satisfy tax withholdings
on stock compensation awards
(1,145
)
—
Payments of offering costs
(30
)
—
Finance lease payments
(1,050
)
(525
)
Principal payments on financing
arrangements
(673
)
—
Loan facility fee payment
—
(100
)
Net cash provided by financing
activities
$
244,271
$
1,111
Net increase (decrease) in cash and
cash equivalents
231,899
(63
)
Cash and cash equivalents – beginning
of period
218,781
90,315
Cash and cash equivalents – end of
period
$
450,680
$
90,252
Supplemental information of non-cash
investing and financing information:
Right-of-use assets obtained in exchange
for operating lease liabilities
$
81
$
3,185
Property and equipment acquisitions
through finance leases
$
203
$
827
Deferred offering costs included in
accounts payable and accrued expenses
$
362
$
—
Purchase of property and equipment and
capitalized software included in accounts payable
$
351
$
791
Cash payments for:
Interest
$
156
$
306
Non-GAAP financial measures
Adjusted EBITDA is a supplemental measure of our performance
that is not required by, or presented in accordance with, GAAP.
Adjusted EBITDA is not a measurement of our financial performance
under GAAP and should not be considered as an alternative to net
income or loss or any other performance measure derived in
accordance with GAAP, or as an alternative to cash flows from
operating activities as a measure of our liquidity. We define
Adjusted EBITDA as net income or loss before interest expense
(income), net, provision for (benefit from) income taxes,
depreciation and amortization, and before stock-based compensation
expense, change in fair value of contingent consideration
liabilities and other (income) expense, net.
We have provided below a reconciliation of Adjusted EBITDA to
net loss, the most directly comparable GAAP financial measure. We
have presented Adjusted EBITDA in this press release and our Annual
Report on Form 10-K because it is a key measure used by our
management and board of directors to understand and evaluate our
core operating performance and trends, to prepare and approve our
annual budget, and to develop short and long-term operational
plans. In particular, we believe that the exclusion of the amounts
eliminated in calculating Adjusted EBITDA can provide a useful
measure for period-to-period comparisons of our core business.
Accordingly, we believe that Adjusted EBITDA provides useful
information to investors and others in understanding and evaluating
our operating results in the same manner as our management and
board of directors.
Our use of Adjusted EBITDA has limitations as an analytical
tool, and you should not consider it in isolation or as a
substitute for analysis of our financial results as reported under
GAAP. Some of these limitations are as follows:
- Although depreciation and amortization expense are non-cash
charges, the assets being depreciated and amortized may have to be
replaced in the future, and Adjusted EBITDA does not reflect cash
capital expenditure requirements for such replacements or for new
capital expenditure requirements;
- Adjusted EBITDA does not reflect: (1) changes in, or cash
requirements for, our working capital needs; (2) the potentially
dilutive impact of non-cash stock-based compensation; (3) tax
payments that may represent a reduction in cash available to us; or
(4) Interest expense (income), net; and
- Other companies, including companies in our industry, may
calculate Adjusted EBITDA or similarly titled measures differently,
which reduces its usefulness as a comparative measure.
Because of these and other limitations, you should consider
Adjusted EBITDA along with other GAAP-based financial performance
measures, including various cash flow metrics, net loss, and our
GAAP financial results. The following table presents a
reconciliation of Adjusted EBITDA to net loss for each of the
periods indicated:
Phreesia, Inc. Adjusted
EBITDA (Unaudited)
Three Months ended April
30,
(in thousands)
2021
2020
Net loss
$
(10,974
)
$
(6,112
)
Interest expense (income), net
238
320
Provision for income taxes
149
111
Depreciation and amortization
4,948
3,621
Stock-based compensation expense
5,774
2,872
Other (income) expense, net
(66
)
715
Adjusted EBITDA
$
69
$
1,527
Phreesia, Inc. Reconciliation
of GAAP and Adjusted Operating Expenses (Unaudited)
Three Months ended April
30,
(in thousands)
2021
2020
GAAP operating expenses
General and administrative
12,671
8,720
Sales and marketing
15,012
9,434
Research and development
8,054
5,005
Cost of revenue
8,534
4,734
$
44,271
$
27,893
Stock compensation included in GAAP
operating expenses
General and administrative
$
2,918
$
1,606
Sales and marketing
1,646
728
Research and development
844
452
Cost of revenue
366
86
$
5,774
$
2,872
Adjusted operating expenses
General and administrative
$
9,753
$
7,114
Sales and marketing
13,366
8,706
Research and development
7,210
4,553
Cost of revenue
8,168
4,648
$
38,497
$
25,021
Phreesia, Inc. Key Metrics
(Unaudited)
Three months ended April
30,
2021
2020
Key Metrics:
Provider clients (average over period)
1,902
1,632
Average revenue per provider client
$
20,222
$
16,735
- Provider clients. We define provider clients as the average
number of healthcare provider organizations that generate revenue
each month during the applicable period. In cases where we act as a
subcontractor providing white-label services to our partner's
clients, we treat the contractual relationship as a single provider
client. We believe growth in the number of provider clients is a
key indicator of the performance of our business and depends, in
part, on our ability to successfully develop and market our
Platform to healthcare provider organizations that are not yet
clients. While growth in the number of provider clients is an
important indicator of expected revenue growth, it also informs our
management of the areas of our business that will require further
investment to support expected future provider client growth. For
example, as the number of provider clients increases, we may need
to add to our customer support team and invest to maintain
effectiveness and performance of our Platform and software for our
provider clients and their patients.
- Average revenue per provider client. We define average revenue
per provider client as the total subscription and related services
and payment processing revenue generated from provider clients in a
given period divided by the average number of provider clients that
generate revenue each month during that same period. We are focused
on continually delivering value to our provider clients and believe
that our ability to increase average revenue per provider client is
an indicator of the long-term value of the Phreesia platform.
Additional Information
(Unaudited)
Three months ended
April 30,
2021
2020
Patient payment volume (in millions)
$
701
$
454
Payment facilitator volume percentage
78
%
84
%
- Patient payment volume. We believe that patient payment volume
is an indicator of both the underlying health of our provider
clients’ businesses and the continuing shift of healthcare costs to
patients. We measure patient payment volume as the total dollar
volume of transactions between our provider clients and their
patients utilizing our payment platform, including via credit and
debit cards that we process as a payment facilitator as well as
cash and check payments and credit and debit transactions for which
Phreesia acts as a gateway to other payment processors.
- Payment facilitator volume percentage. We define payment
facilitator volume percentage as the volume of credit and debit
card patient payment volume that we process as a payment
facilitator as a percentage of total patient payment volume.
Payment facilitator volume is a major driver of our payment
processing revenue.
Available Information
Phreesia intends to use its Company website (including its
Investor Relations website) as well as its Facebook, Twitter and
LinkedIn accounts as a means of disclosing material non-public
information and for complying with its disclosure obligations under
Regulation FD.
Forward Looking Statements
This press release includes express or implied statements that
are not historical facts and are considered forward-looking within
the meaning of Section 27A of the Securities Act and Section 21E of
the Securities Exchange Act. Forward-looking statements involve
substantial risks and uncertainties. Forward-looking statements
generally relate to future events or our future financial or
operating performance and may contain projections of our future
results of operations or of our financial information or state
other forward-looking information. In some cases, you can identify
forward-looking statements by the following words: “may,” “will,”
“could,” “would,” “should,” “expect,” “intend,” “plan,”
“anticipate,” “believe,” “estimate,” “predict,” “project,”
“potential,” “continue,” “ongoing,” or the negative of these terms
or other comparable terminology, although not all forward-looking
statements contain these words. Although we believe that the
expectations reflected in these forward-looking statements are
reasonable, these statements relate to future events or our future
operational or financial performance and involve known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements expressed or
implied by these forward looking statements. Furthermore, actual
results may differ materially from those described in the
forward-looking statements and will be affected by a variety of
risks and factors that are beyond our control, including, without
limitation, statements about our future financial performance,
including our revenue, cash flows, costs of revenue and operating
expenses; our anticipated growth; our predictions about our
industry; the impact of the COVID-19 pandemic on our business and
our ability to attract, retain and cross-sell to healthcare
provider clients. The forward-looking statements contained in this
release are also subject to other risks and uncertainties,
including those more fully described in our filings with the
Securities and Exchange Commission (“SEC”), including in our
Quarterly Report on Form 10-Q for the fiscal year ended April 30,
2021 that will be filed with the SEC following this earnings
release. The forward-looking statements in this press release speak
only as of the date on which the statements are made. We undertake
no obligation to update, and expressly disclaim the obligation to
update, any forward-looking statements made in this press release
to reflect events or circumstances after the date of this press
release or to reflect new information or the occurrence of
unanticipated events, except as required by law.
This press release includes certain non-GAAP financial measures
as defined by SEC rules. We have provided a reconciliation of those
measures to the most directly comparable GAAP measures.
ABOUT PHREESIA
Phreesia gives healthcare organizations a suite of robust
applications to manage the patient intake process. Our innovative
SaaS platform engages patients in their care and provides a modern,
consistent experience, while enabling healthcare organizations to
optimize their staffing, boost profitability and enhance clinical
care.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210603005887/en/
Investors: Balaji Gandhi Phreesia, Inc. investors@phreesia.com
(929) 506-4950 Media: Annie Harris Phreesia, Inc.
aharris@phreesia.com (929) 526-2611
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