- Revenue for the year up 32% to $12.3M for 2023 compared to $9.2M for 2022.
- Loss from operations for 2023 was $(2.5)M, an improvement of $3.7M, when compared to 2022.
- Net Loss for 2023 was $(3.3)M ,
and improvement of $14.5M compared to
Net Loss of $(17.8)M for 2022, which
included a non-cash impairment of goodwill and intangible assets
for a total of $12.5M.
- Adjusted EBITDA(1) loss of $(1.1)M for 2023, compared to Adjusted
EBITDA(1) loss of $(4.1)M
for 2022, an improvement of $3.0M.
- Adjusted EBITDA Margin(1) of (9)% in 2023
compared to (44)% in 2022.
- ARR(2) of $12.1M as of
December 31, 2023, an increase of 42%
over the same date in 2022.
- During the year, the Company successfully raised $4.5M in equity and convertible debt, amended and
extended its credit facilities, and reduced its short-term
liabilities by more than $2.8M,
positioning the Company to achieve its objectives going
forward.
MONTREAL, April 1,
2024 /CNW/ - Carebook Technologies Inc.
("Carebook" or the "Company") (TSXV: CRBK)
(OTCPK: CRBKF) (XFRA: PMM1), a leading Canadian provider of
innovative digital health solutions today announced its results for
the year ended December 31, 2023.
__________
|
1
EBITDA and Adjusted EBITDA are non-IFRS financial measures, and
Adjusted EBITDA Margin is a non-IFRS financial ratio, in each case
without a standardized meaning under IFRS and which may not be
comparable to similar measures or ratios used by other issuers.
Please refer to the sections "Cautionary Note Regarding Non-IFRS
Measures, non-IFRS Ratios and Key Performance Indicators",
"Non-IFRS Measures and Non-IFRS Ratios" and "Non-IFRS Measures and
Reconciliation of Non-IFRS Measures EBITDA and Adjusted EBITDA" for
the definitions of such non-IFRS financial measures and ratio, an
explanation of the usefulness of such non-IFRS financial measures
and ratio, and a reconciliation of non-IFRS financial measures to
the most directly comparable IFRS financial measure.
|
2
Annual Recurring Revenue or ARR is a key performance indicator.
Please refer to the sections "Cautionary Note Regarding Non-IFRS
Measures, non-IFRS Ratios and Key Performance Indicators" and "Key
Performance Indicators" below for the definition of ARR, as well as
an explanation of the usefulness of such key performance indicator
to the Company.
|
"2023 was definitely an important year as we solidified our
operations from multiple perspectives. We completed several large
implementations and helped our clients onboard a significant amount
of users during the year, indicating strong demand for health and
wellness services continues to exist" commented Michael Peters, Carebook CEO. "We were
successful delivering 32% revenue growth, which was all organic
during 2023, while continuing to find further efficiencies within
our cost structure and improve our margins and operating cash
flows. We expect the organic revenue growth trend to continue into
2024 and we will continue managing cost with an objective of
minimizing cash burn and increasing our profit margins. As we were
also successful raising long term capital and repaying short term
liabilities in 2023, we also significantly increased our financial
runway giving us more time to properly execute our business
plan."
Fiscal 2023 Highlights
Revenue
Revenue for the year ended December 31,
2023 was $12.3M compared to
$9.2M for the year ended December 31, 2022, an increase of 32% driven by
strong organic growth in the pharmacy vertical and an increase in
license revenue from CoreHealth offset by a decrease in license
revenue at Infotech. Revenue in the year ended December 31, 2023, was contributed 63% from the
employer vertical and 37% from the pharmacy vertical.
Recurring revenue from the employer vertical business is
expected to continue to increase during 2024, following the
implementation of several large customers during 2023 and the first
quarter of 2024.
Loss from Operations and Total Comprehensive
Loss
Loss from operations for the year ended December 31, 2023, was $(2.5)M compared to $(6.2)M incurred in the same period of 2022, an
improvement of $3.7M. The decrease in
operating expenses was due to lower research and development costs
and lower sales and marketing costs slightly offset by higher
general and administrative costs.
Total comprehensive loss was $(3.3)M for year ended December 31, 2022, compared to a loss of
$(17.8)M for the year ended
December 31, 2021, an improvement of
$14.5M. The variance is driven mostly
the absence of a major impairment to goodwill and intangible assets
and by a lower loss from operations.
Adjusted EBITDA(1)
Adjusted EBITDA(1) loss for the year ended
December 31, 2023 was $(1.1)M compared to an Adjusted
EBITDA(1) loss of $(4.1)M
for the year ended December 31, 2022,
an improvement of $3.0M over the same
period in 2022. The corresponding Adjusted EBITDA
Margin(1) for the year ended December 31, 2023 was (9)% compared to (44)% in
2022, and represented a meaningful improvement, demonstrating
management's fortitude and discipline to continue to generate
increasing revenue while managing costs to
reach profitability.
Annual Recurring Revenue
ARR(2) was $12.1M as at
December 31, 2023, an increase of
$3.6M, or 42%, compared to an
ARR(2) of $8.5M as at
December 31, 2022. This increase was
primarily driven by new enterprise customers and organic growth
with existing customers. Of the $12.1M of ARR(2) reported, 62%
originated from clients outside of Canada.
Capital Raised, Renewal and Amendment of Credit
Facilities
On March 8th, 2023, the
Company announced the closing of a non-brokered private placement
with UIL Limited, its largest shareholder, for $1.25M in gross proceeds. The private placement
resulted in the issuance of 12,500,000 Common Shares at
$0.10 per unit and 187,500 Common
Share purchase warrants, with each warrant entitling the holder to
acquire one Common Share for $0.15 on
or before March 8th,
2025.
On May 23rd, 2023, the
Company announced the closing of a non-brokered private placement
of units at $0.10 per unit with
Permanent Mutual Limited, an affiliate of UIL Limited, for
$1.25M in gross proceeds. The private
placement resulted in the issuance of 12,500,000 Common Shares and
187,500 Common Share purchase warrants, with each warrant entitling
the holder to acquire one Common Share for $0.15 on or before May
23rd, 2025.
Effective as of October 19, 2023
(the "Renewal Date") the Company renewed and amended its
existing senior credit facilities with a leading Canadian Schedule
I bank (the "Lender"). Under the amendment, the Lender
agreed to (i) continue providing the Company with a $3M revolving facility (the "Revolving
Facility") and (ii) be subrogated to all rights of its
affiliate regarding a $1.4M
non-revolving term loan facility (the "Term Loan
Facility" and together with the Revolving Facility, the
"Credit Facilities"). Moreover, the maturity date of the
Credit Facilities was extended until September 30, 2024 (the "Maturity
Date")
Beginning on the Renewal Date, the applicable margin on the
Revolving Facility was decreased to 5.8% over prime, and the
applicable margin on the Term Loan Facility was decreased to 5.3%
over prime.
The Term Loan Facility is subject to mandatory monthly
prepayments of $50,000 on the 15th of
each month, commencing on November
15th, 2023, such that the Term Loan Facility will
be reduced to $0.8M by the Maturity
Date. The Credit Facilities are subject to new financial covenants,
where the Company must maintain a minimum cash runway and
demonstrate minimum revenue growth. The Credit Facilities continue
to be secured by a first-ranking security interest in all of the
present and future property and assets of the Company and certain
of its subsidiaries.
On December 11, 2023, the Company
announced the closing of a private placement with UIL Limited, for
$2.0M in gross proceeds. The private
placement was completed through a convertible loan agreement
maturing on December 22, 2026. The
convertible loan agreement included a conversion feature, under
which UIL Limited has the right, at their sole option, at any time
after six months of the closing of the transaction up and until the
maturity date, to convert the principal sum outstanding in whole or
in part to common shares at a price of $0.10 per common share. If the Company
completes an equity financing or other issuance of Common Shares
having an aggregate fair market value of $2.0M at the time of issuance (excluding for such
purposes any Common Shares issued upon exercise or conversion of
outstanding convertible securities of the Company) within six
months of the closing of the transaction, then the principal amount
and any accrued but unpaid interest thereon under the convertible
loan shall be automatically converted into common shares at the
highest of (i) $0.05 per common
share, and (ii) the subscription price per common share issued to
any person as part of an equity financing during the automatic
conversion period, subject to a maximum of $0.25 per Common Share.
Effective December 11, 2023,
following the closing of the private placement, the applicable
interest rate on the Revolving Facility decreased to 4.3% over
prime and the applicable interest rate on the Term Loan Facility
decreased to 4.8% over prime.
Financial Outlook
Carebook's financial outlook continues to be positive for 2024.
The Company is poised to achieve significant revenue growth while
effectively managing its costs and
delivering sustained growth in cashflows. Carebook's strong organic
growth and efficient cost management initiatives will allow the
Company to continue to successfully execute on its strategy.
Carebook is expecting to maintain strong performance in 2024 for
the entire Company as a whole and although actual results may
differ, we believe Carebook is on a course to deliver Adjusted
EBITDA(1) break even or better in fiscal 2024. To
complement its organic growth strategy, Carebook will continue to
seek out accretive acquisitions and partnerships that improve the
accessibility, quality, and functionality of its comprehensive
solutions, surrounding ecosystem, and supporting services. Carebook
has adopted a disciplined approach towards exploring strategic
M&A opportunities in order to grow its reach in other markets
and offer new services to its customer base, while maintaining a
focus on its organic growth. This financial outlook is fully
qualified and based on a number of assumptions and subject to a
number of risks described under the headings "Financial Outlook
Assumptions" and "Notice Regarding Forward-Looking Statements" of
this press release.
Conference Call Details
A conference call will be held at 8:30 AM Eastern
on April 1, 2024 to discuss Carebook's year end financial
results. Participants may join the Company's conference call by
using the following information
Conference Call
Details
|
|
Date
|
Monday, April 1,
2024
|
Time:
|
8:30 a.m. Eastern
Time
|
Local:
|
416-764-8659
|
North American Toll
Free:
|
1-888-664-6392
|
RapidConnect
URL:
|
Click here
|
Webcast URL:
|
Click here
|
|
|
Conference
Replay
|
|
Local:
|
416-764-8677
|
North American Toll
Free:
|
1-888-390-0541
|
Entry Code:
|
113963#
|
Expiration
Date:
|
04/08/2024
|
Carebook's interim condensed consolidated financial statements
and accompanying notes, and Management's Discussion and Analysis
for the year ended December 31, 2023 are available on the
Company's website at www.carebook.com and on SEDAR+
at www.sedarplus.ca.
Cautionary Note Regarding Non-IFRS Measures, non-IFRS Ratios
and Key Performance Indicators
This press release makes reference to certain non-IFRS measures
and key performance indicators. These measures are not standardized
financial measures under IFRS as issued by the IASB and do not have
a standardized meaning prescribed by IFRS and are therefore
unlikely to be comparable to similar measures presented by other
companies. Rather, these measures are provided as additional
information to complement those IFRS measures by providing further
understanding of our results of operations from management's
perspective. Accordingly, these measures should not be considered
in isolation nor as a substitute for analysis of our financial
information reported under IFRS. We use non-IFRS measures,
including "EBITDA" and "Adjusted EBITDA" and non-IFRS ratios
including "Adjusted EBITDA Margin". This press release also makes
reference to "Annual Recurring Revenue" or "ARR", which is a key
performance indicator used in our industry. These non-IFRS
measures, non-IFRS ratios and key performance indicators are used
to provide investors with supplemental measures of our operating
performance and liquidity and thus highlight trends in our business
that may not otherwise be apparent when relying solely on IFRS
measures. The Company also believes that securities analysts,
investors, and other interested parties frequently use non-IFRS
measures, non-IFRS ratios and key performance indicators in the
evaluation of issuers. The Company's management also uses non-IFRS
measures, non-IFRS ratios and key performance indicators in order
to facilitate operating performance comparisons from period to
period, to prepare annual operating budgets and forecasts, and to
determine components of management and executive compensation. The
key performance indicators used by the Company may be calculated in
a manner different than similar key performance indicators used by
other companies.
Non-IFRS Measures and Non-IFRS Ratios
"Adjusted EBITDA" is defined as EBITDA adjusted for
non-recurring M&A and other transaction costs, certain
non-recurring costs (or savings), share-based compensation, foreign
exchange loss (gain), intangible asset and goodwill impairment,
changes in fair value of warrants or changes in fair value of
contingent consideration. Adjusted EBITDA provides management with
a useful supplemental measure in evaluating the performance of our
operations and provides better transparency into our results of
operations. Adjusted EBITDA indicates our ability to generate
profit from our operations prior to considering our financing
decisions and costs of consuming intangible and capital assets.
"EBITDA" is defined as net income or loss before income tax
expenses, finance costs and depreciation and amortization.
"Adjusted EBITDA Margin" is calculated as Adjusted EBITDA
divided by revenue for the relevant period.
Key Performance Indicators
"Annual Recurring Revenue" or "ARR" represents contracted
software and services revenues that are expected to have a duration
of more than one year, and is equal to the annualized value of
contracted recurring revenue from all clients on our platforms at
the date being measured. Contracted recurring revenue is revenue
generated from clients who are, as of the date being measured,
party to contracts with Carebook that are contributing to revenue
in the calendar month of the date being measured, and also include
revenue from clients who are, as of the date being measured, party
to contracts with Carebook that are to contribute to revenue within
a year of the date being measured. ARR provides a consolidated
measure by which we can monitor the longer-term trends in our
business.
Non-IFRS Measures and Reconciliation of Non-IFRS Measures
EBITDA and Adjusted EBITDA
|
|
TWELVE
MONTHS
ENDED
December 31, 2023
|
|
TWELVE
MONTHS
ENDED
December 31, 2022
|
|
|
|
|
|
Net
loss
|
|
$
(3,315)
|
|
$
(17,818)
|
Add:
|
|
|
|
|
Amortization and
depreciation expense
|
|
$
1,592
|
|
$
2,090
|
M&A
costs
|
|
$
-
|
|
$
17
|
Finance
costs
|
|
$
1,513
|
|
$
1,082
|
Other income
(1)
|
|
$
(211)
|
|
$
-
|
Income Tax expense
(recovery)
|
|
$
(700)
|
|
$
(1,280)
|
Impairment
(2)
|
|
$
178
|
|
$
12,582
|
EBITDA
(3)
|
|
$
(943)
|
|
$
(3,327)
|
Add:
|
|
|
|
|
Share-Based
compensation
|
|
$
341
|
|
$
53
|
Change in fair value of
contingent consideration (4)
|
|
|
$
(820)
|
Additional One-Time
Costs (Savings) (5)
|
|
$
(538)
|
|
$
-
|
Adjusted EBITDA
(3)
|
|
$
(1,140)
|
|
$
(4,094)
|
(1)
|
Other income includes a
gain following the initial recognition of the net investment from
the Montreal office sublease.
|
(2)
|
Impairment on disposal
of leasehold improvements from Carebook subleasing the Montreal
office for 2023 and for non-cash impairment of goodwill and
intangible assets in 2022.
|
(3)
|
Non-IFRS financial
measures without a standardized definition under IFRS, which may
not be comparable to similar measures used by other issuers. Refer
to the Section "Non-IFRS Measures and Non-IFRS Ratios" for an
explanation of the composition and usefulness of these non-IFRS
financial measures.
|
(4)
|
The change in fair
value of contingent consideration relates to the change in the
earn-out value for the CoreHealth business combination transaction
for the year ended December 31, 2022. The Company uses a
scenario-based model to independently assess individual earn-outs
and calculate the fair value of the earn-out based on probabilities
of success attributable to each individual scenario.
|
(5)
|
Additional
One-Time Costs (Savings) relate to grants received from the Quebec
government and Prompt, a trust agency of the Ministry of Economy,
Innovation and Energy research group in Québec.
|
About Carebook Technologies
Carebook's digital health platform empowers its clients and more
than 4.6 million members to take control of their health journey.
During 2021, the Company completed the acquisitions of InfoTech
Inc. ("InfoTech"), a global leader in health and
productivity risk management, and CoreHealth Technologies Inc.
("CoreHealth"), owner of an industry-leading wellness
platform. In combination, these companies create a comprehensive
digital health platform that includes both assessment tools and the
technology to deliver complementary solutions. Carebook's shares
trade on the TSXV under the symbol "CRBK," on the OTC Markets under
the symbol "CRBKF," and are listed on the Open Market of the
Frankfurt Stock Exchange under the symbol "PMM1."
www.carebook.com
For further information contact:
Carebook Investor Relations Contact:
Olivier Giner, CFO
Email : ir@carebook.com
Telephone: (450) 977-0709
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this news release.
Financial Outlook Assumptions
Our financial outlook is based on a number of assumptions,
including assumptions related to inflation, changes in interest
rates, consumer spending, foreign exchange rates and other
macroeconomic conditions; our major revenue streams remaining in
line with our expectations; customers adopting our solutions at an
average contract value at or above that of our planned levels; our
ability to price our products in line with our expectations and to
achieve suitable margins; our ability to achieve success in the
continued expansion of our product lines and solutions; continued
success in additional product adoption and user base expansion
throughout our customer base; our ability to derive the benefits we
expect from the acquisitions we have completed; our ability to
attract and retain key personnel required to achieve our plans; our
expectations regarding the costs, timing and impact of our cost
reduction initiatives; our ability to manage customer churn and
churn rates remaining at planned levels. Our financial outlook does
not give effect to the potential impact of acquisitions that may be
announced or closed after the date hereof. Our financial outlook,
including the various underlying assumptions, constitutes
forward-looking information and should be read in conjunction with
the cautionary notice on forward-looking statements below. Many
factors may cause our actual results, level of activity,
performance or achievements to differ materially from those
expressed or implied by such forward-looking information.
Notice Regarding Forward-Looking Statements:
This release includes forward-looking information and
forward-looking statements within the meaning of Canadian
securities laws regarding Carebook, its subsidiaries and their
business. Often, but not always, forward-looking information can be
identified by the use of words such as "plans", "is expected",
"expects", "scheduled", "intends", "contemplates", "anticipates",
"believes", "proposes" or variations (including negative
variations) of such words and phrases, or state that certain
actions, events or results "may", "could", "would", "might" or
"will" be taken, occur or be achieved. Forward-looking information
in this release include statements with respect to revenue, our
2024 full year outlook, the Company's growth strategy, management's
expectations regarding revenue growth and cost management, contract
generation and the overall value of recently signed contracts and
the Company's path to profitability. Such statements are based on
the current expectations of the management of Carebook and are
based on assumptions and subject to risks and uncertainties.
Although the management of Carebook believes that the assumptions
underlying these statements are reasonable, they may prove to be
incorrect, and undue reliance should not be placed on such
forward-looking statements. The forward-looking statements reflect
the Company's current views with respect to future events based on
currently available information and are inherently subject to risks
and uncertainties. The forward-looking events and circumstances
discussed in this release may not occur by certain specified dates
or at all and could differ materially as a result of known and
unknown risk factors and uncertainties affecting the Company,
including economic factors, management's ability to manage and to
operate the business of Carebook, management's ability to identify
attractive M&A opportunities, management's ability to
successfully integrate the Company's completed acquisitions and to
realize the synergies of such acquisitions, management's ability to
successfully complete product studies, the equity markets generally
and risks associated with growth and competition, management's
ability to achieve profitability for the Company, as well as the
risk factors identified in the Company's management's discussion
and analysis for the year ended December 31,
2023, a copy of which can be found on SEDAR+ under the
Company's profile at www.sedarplus.ca. Although Carebook has
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors
that cause actions, events or results to differ from those
anticipated, estimated or intended. Accordingly, readers should not
place undue reliance on any forward-looking statements or
information. No forward-looking statement can be guaranteed. Except
as required by applicable securities laws, forward-looking
statements speak only as of the date on which they are made and
Carebook does not undertake any obligation to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events, or otherwise.
SOURCE Carebook Technologies Inc.