1Life Healthcare, Inc. (One Medical) (Nasdaq: ONEM) today announced
financial results for the second quarter ended June 30, 2021.
“One Medical’s human-centered and technology-powered model
continues to resonate with a growing number of employers and
consumers, supporting another quarter of outstanding performance
delivered by our fabulous team,” said Amir Dan Rubin, Chair &
CEO of One Medical. “With the proposed acquisition of Iora Health,
we can further advance One Medical's position as a leader in
consumer-driven, technology-powered, value-based health care across
all ages and every stage of life.”
Financial Highlights for the Second Quarter
2021
All comparisons, unless otherwise noted, are to the three months
ended June 30, 2020.
- Membership count
as of quarter-end was 621,000 compared to 475,000, a 31%
increase.
- Net Revenue was
$120.4 million compared to $78.0 million, a 54% increase.
- Care Margin was
$52.5 million, or 44% of net revenue; Loss from Operations was
$42.6 million, or 35% of net revenue.
- Adjusted EBITDA
was positive $6.9 million, or 6% of net revenue; Net Loss was $41.3
million, or 34% of net revenue.
Financial Outlook
One Medical provides forward-looking guidance on membership
count, net revenue, care margin, and adjusted EBITDA. Care margin
and adjusted EBITDA are non-GAAP measures.
For the third quarter of 2021, we expect:
- Ending Membership
count in the range of 640,000 to 650,000; and,
- Net Revenue in the
range of $113 million to $120 million.
For the full year of 2021, we expect:
- Ending Membership
count in the range of 670,000 to 680,000;
- Net Revenue in the
range of $475 million to $485 million;
- Care Margin in the
range of $185 million to $195 million; and
- Adjusted EBITDA
that approximates break-even.
Management has not reconciled forward-looking non-GAAP care
margin and adjusted EBITDA to their most directly comparable GAAP
measures of loss from operations and net loss, respectively. This
is because we cannot predict with reasonable certainty and without
unreasonable efforts the ultimate outcome of certain GAAP
components of such reconciliations, including market-related
assumptions that are not within our control, certain legal or
advisory costs or others that may arise, without unreasonable
effort. For these reasons, we are unable to assess the probable
significance of the unavailable information, which could materially
impact the amount of the future directly comparable GAAP measures.
See below for additional important disclosures regarding our
non-GAAP financial measures. Our definition of adjusted EBITDA has
been revised from our previous reports of adjusted EBITDA to also
adjust for certain legal or advisory costs prospectively from the
first quarter of 2021, and adjust for acquisition and integration
costs prospectively from the second quarter of 2021.
Quarterly Conference Call Details
The company will host a conference call to review the results
today, Wednesday, August 4, 2021 at 1:30 p.m. (PT) / 4:30 p.m.
(ET). A live audio webcast will be available online at
https://investor.onemedical.com. The conference call can also be
accessed by dialing 1-800-258-1651 for U.S. participants, or
1-612-979-9928 for international participants, and referencing
conference ID 7826508. 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.
Key Metrics and Non-GAAP Financial Measures
Members: A member is a person who has paid for
membership themselves or an employee or dependent whose membership
has been paid for by an enterprise client for at least one year in
a market where we have an office and who has registered with us.
Members help drive membership revenue, partnership revenue and
patient service revenue. We may offer trial memberships to
enterprise clients, particularly for new services, and we offer
access to One Medical Now, our 24/7 virtual care platform, to
enterprise clients. The fees generated from these services are
included in our Membership Revenue, although we do not include
these covered employees as members. Our number of members depends,
in part, on our ability to successfully market our services
directly to consumers and to employers that are not yet enterprise
clients and our activation rate within existing clients. While
growth in the number of members 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 member growth. Member numbers as of the end
of each period are rounded to the thousands.
Reconciliations of non-GAAP financial measures to the most
directly comparable financial results as determined in accordance
with GAAP are included at the end of this press release following
the accompanying financial data. We believe that these non-GAAP
financial measures, when taken together with the corresponding GAAP
financial measures, provide meaningful supplemental information
regarding our performance by excluding certain items that may not
be indicative of our business, results of operations, or outlook.
However, non-GAAP financial information is presented for
supplemental informational purposes only, has limitations as an
analytical tool and should not be considered in isolation or as a
substitute for financial information presented in accordance with
GAAP. In addition, other companies, including companies in our
industry, may calculate similarly-titled non-GAAP measures
differently or may use other measures to evaluate their
performance, all of which could reduce the usefulness of our
non-GAAP financial measures as tools for comparison.
Care Margin: we define care margin as loss from
operations excluding depreciation and amortization, stock-based
compensation, general and administrative expense and sales and
marketing expense. We consider care margin to be an important
measure to monitor our performance, specific to the direct costs of
delivering care. We believe this margin is useful to measure
whether we are controlling our direct expenses included in the
provision of care sufficiently and whether we are effectively
pricing our services. We have provided below a reconciliation of
historical care margin to loss from operations, its most directly
comparable GAAP financial measure.
Adjusted EBITDA: we define adjusted EBITDA as
net income (loss) excluding interest income, interest expense,
depreciation and amortization, stock-based compensation, change in
the fair value of our redeemable convertible preferred stock
warrant liability, provision for (benefit from) income taxes,
certain legal or advisory costs, and acquisition and integration
costs that the Company does not consider to be expenses incurred in
the normal operation of the business. Such legal or advisory costs
may include but are not limited to expenses with respect to
evaluating potential business combinations, legal investigations,
or settlements. Acquisition and integration costs include expenses
incurred in connection with the closing and integration of
acquisitions, which may vary significantly and are unique to each
acquisition. We made this update to prospectively exclude from our
presentation certain legal or advisory costs from the first quarter
of 2021 and acquisition and integration costs from the second
quarter of 2021, because amounts incurred in the prior periods were
insignificant. We report adjusted EBITDA because it is an important
measure upon which our management assesses and believes investors
should assess our operating performance. We consider adjusted
EBITDA to be an important measure because it helps illustrate
underlying trends in our business and our historical operating
performance on a more consistent basis. We have provided below a
reconciliation of historical adjusted EBITDA to net loss, its most
directly comparable GAAP financial measure.
Available Information
One Medical 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 contains forward-looking statements about us
and our industry that involve substantial risks and uncertainties
and are based on our beliefs and assumptions and on information
currently available to us. All statements other than statements of
historical facts contained in this press release, including
statements regarding our future results of operations, financial
condition, business strategy and plans and objectives of management
for future operations and statements about One Medical's agreement
to acquire Iora Health, Inc., are forward-looking statements. In
some cases, you can identify forward-looking statements because
they contain words such as “anticipate,” “believe,” “could,”
“estimate,” “expect,” “intend,” “may,” “plan,” “potential,”
“predict,” “project,” “should,” “will,” or “would,” or the negative
of these words or other similar terms or expressions.
Forward-looking statements 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
the forward-looking statements. Forward-looking statements
represent our current beliefs, estimates and assumptions only as of
the date of this press release and information contained in this
press release should not be relied upon as representing our
estimates as of any subsequent date. These statements, and related
risks, uncertainties, factors and assumptions, include, but are not
limited to: the proposed transaction between One Medical and Iora
Health, Inc. and our ability to timely and successfully achieve the
anticipated benefits and potential synergies of the transaction;
the strength of the One Medical brand; member satisfaction with our
services and support; the effects of the COVID-19 pandemic and
related self-isolation and quarantine measures on our business,
revenue, future growth and results of operations; anticipated
membership growth and revenue potential from our members; our
ability to retain members; our ability to successfully introduce
and drive adoption of new products; changes in the pricing we offer
our members; our relationships with our health network partners and
enterprise clients and any changes to, accommodations in or
terminations of our contracts with the health network partners or
enterprise clients; our ability to improve cost of care and
margins, including timing and expenses of new office openings and
entry into new geographic markets; changes in laws or regulations;
our involvement in existing and potential litigation, including
medical malpractice claims and consumer class actions; any
governmental investigations or inquiries, including those related
to COVID-19 vaccine administration or challenges to our
relationships with the One Medical PCs under the administrative
services agreements; our strategic plan; our financial outlook; our
focus areas for investment and our investments; announcements by us
or our competitors of business or strategic developments; and our
overall business trajectory. These risks are not exhaustive. Except
as required by law, we assume no obligation to update these
forward-looking statements, or to update the reasons actual results
could differ materially from those anticipated in the
forward-looking statements, even if new information becomes
available in the future. Further information on factors that could
cause actual results to differ materially from the results
anticipated by our forward-looking statements is included in the
reports we have filed or will file with the Securities and Exchange
Commission, including our Quarterly Report on Form 10-Q for the
Quarter ended June 30, 2021. These filings, when available,
are available on the investor relations section of our website at
investor.onemedical.com and on the SEC’s website at
www.sec.gov.
Additional Information and Where to Find It
In connection with the pending merger between One Medical and
Iora Health, Inc. ("Merger"), One Medical filed with the SEC a
registration statement on Form S-4, which included a document that
serves as a prospectus and proxy statement of One Medical and
included an information statement of Iora Health, Inc. (the “proxy
statement/prospectus/consent solicitation statement”). The SEC
declared the registration statement effective on July 16, 2021, and
the proxy statement/prospectus/consent solicitation statement was
first sent to stockholders of One Medical and Iora Health, Inc. on
or about July 16, 2021. One Medical may file other documents
regarding the Merger with the SEC. BEFORE MAKING ANY VOTING OR
INVESTMENT DECISION, SECURITY HOLDERS OF ONE MEDICAL ARE URGED TO
READ THE REGISTRATION STATEMENT, THE PROXY
STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT (INCLUDING ALL
AMENDMENTS AND SUPPLEMENTS THERETO) AND OTHER DOCUMENTS RELATING TO
THE MERGER FILED WITH THE SEC BECAUSE THEY CONTAIN OR WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER. Investors and
security holders will be able to obtain free copies of these
documents, and other documents filed with the SEC, by One Medical
through the website maintained by the SEC at www.sec.gov. In
addition, investors and security holders will be able to obtain
free copies of these documents from One Medical by contacting One
Medical’s Investor Relations by email at investor@onemedical.com,
or by going to the One Medical web page at
https://investor.onemedical.com.
Participants in the Solicitation
The respective directors and executive officers of One Medical
and Iora Health, Inc. may be deemed to be participants in the
solicitation of proxies from One Medical’s stockholders and written
consents from the security holders of Iora Health, Inc. in
connection with the proposed Merger. Stockholders may obtain
additional information regarding the interests of such participants
by reading the registration statement and the proxy
statement/prospectus/consent solicitation statement and other
relevant materials filed with the SEC regarding the pending Merger.
Investors should read the registration statement and the proxy
statement/prospectus/consent solicitation statement carefully
before making any voting or investment decisions.
No Offer or Solicitation
This press release is not intended to and shall not constitute
an offer to sell or the solicitation of an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote of approval, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities
shall be made except by means of a prospectus that meets the
requirements of Section 10 of the Securities Act of 1933, as
amended.
About One Medical
One Medical is a membership-based and technology-powered primary
care platform with seamless digital health and inviting in-office
care, convenient to where people work, shop, live, and click. Our
vision is to delight millions of members with better health and
better care while reducing costs. Our mission is to transform
health care for all through our human-centered, technology-powered
model. Headquartered in San Francisco, 1Life Healthcare, Inc. is
the administrative and managerial services company for the
affiliated One Medical physician owned professional corporations
that deliver medical services in-office and virtually. 1Life and
the One Medical entities do business under the “One Medical”
brand.
Media Contact:Kristina Skinner, One
MedicalSenior Director of External
Communicationspress@onemedical.com650-743-5187
Investor Contact:WestwickeBob East or Asher
Dewhurstonemedical@westwicke.com443-223-0500
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(Amounts in thousands, except per share
amounts)(unaudited)
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Net revenue |
$ |
120,416 |
|
|
$ |
78,000 |
|
|
$ |
241,768 |
|
|
$ |
156,756 |
|
Operating expenses: |
|
|
|
|
|
|
|
Cost of care, exclusive of depreciation and amortization shown
separately below |
67,922 |
|
|
53,450 |
|
|
138,014 |
|
|
104,999 |
|
Sales and marketing (1) |
10,570 |
|
|
9,777 |
|
|
23,259 |
|
|
20,933 |
|
General and administrative (1) |
77,196 |
|
|
38,311 |
|
|
141,541 |
|
|
78,177 |
|
Depreciation and amortization |
7,292 |
|
|
5,175 |
|
|
13,899 |
|
|
10,388 |
|
Total operating expenses |
162,980 |
|
|
106,713 |
|
|
316,713 |
|
|
214,497 |
|
Loss from operations |
(42,564 |
) |
|
(28,713 |
) |
|
(74,945 |
) |
|
(57,741 |
) |
Other income (expense), net: |
|
|
|
|
|
|
|
Interest income |
79 |
|
|
366 |
|
|
184 |
|
|
1,400 |
|
Interest expense |
(2,842 |
) |
|
(1,976 |
) |
|
(5,685 |
) |
|
(2,029 |
) |
Change in fair value of redeemable convertible preferred
stock warrant liability |
— |
|
|
— |
|
|
— |
|
|
(6,560 |
) |
Total other expense, net |
(2,763 |
) |
|
(1,610 |
) |
|
(5,501 |
) |
|
(7,189 |
) |
Loss before income taxes |
(45,327 |
) |
|
(30,323 |
) |
|
(80,446 |
) |
|
(64,930 |
) |
Provision for (benefit from)
income taxes |
(4,040 |
) |
|
(22 |
) |
|
159 |
|
|
(72 |
) |
Net loss |
(41,287 |
) |
|
(30,301 |
) |
|
(80,605 |
) |
|
(64,858 |
) |
Less: Net loss attributable to noncontrolling
interest |
— |
|
|
— |
|
|
— |
|
|
(704 |
) |
Net loss attributable to 1Life
Healthcare, Inc. stockholders |
$ |
(41,287 |
) |
|
$ |
(30,301 |
) |
|
$ |
(80,605 |
) |
|
$ |
(64,154 |
) |
Net loss per share
attributable to 1Life Healthcare, Inc. stockholders — basic
and diluted |
$ |
(0.30 |
) |
|
$ |
(0.24 |
) |
|
$ |
(0.59 |
) |
|
$ |
(0.61 |
) |
Weighted average common shares
outstanding — basic and diluted |
136,788 |
|
|
126,150 |
|
|
137,045 |
|
|
105,517 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes stock-based compensation, as
follows:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
Sales and marketing |
$ |
964 |
|
|
$ |
668 |
|
|
$ |
1,987 |
|
|
$ |
1,268 |
|
General and administrative |
25,368 |
|
|
7,695 |
|
|
50,673 |
|
|
17,420 |
|
Total |
$ |
26,332 |
|
|
$ |
8,363 |
|
|
$ |
52,660 |
|
|
$ |
18,688 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of Net Revenue:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
Net revenue: |
|
|
|
|
|
|
|
Net patient service revenue |
$ |
43,416 |
|
|
$ |
23,927 |
|
|
$ |
87,878 |
|
|
$ |
58,013 |
|
Partnership revenue |
56,126 |
|
|
33,993 |
|
|
111,057 |
|
|
63,448 |
|
Total net patient service and partnership revenue |
99,542 |
|
|
57,920 |
|
|
198,935 |
|
|
121,461 |
|
Membership revenue |
20,874 |
|
|
17,680 |
|
|
41,070 |
|
|
32,895 |
|
Grant income |
— |
|
|
2,400 |
|
|
1,763 |
|
|
2,400 |
|
Net revenue |
$ |
120,416 |
|
|
$ |
78,000 |
|
|
$ |
241,768 |
|
|
$ |
156,756 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statements of Operations Data as a Percentage of Net
Revenue:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
Net revenue |
100 |
|
% |
|
100 |
|
% |
|
100 |
|
% |
|
100 |
|
% |
Operating expenses: |
|
|
|
|
|
|
|
Cost of care, exclusive of depreciation and amortization shown
separately below |
56 |
|
% |
|
69 |
|
% |
|
57 |
|
% |
|
67 |
|
% |
Sales and marketing (1) |
9 |
|
% |
|
13 |
|
% |
|
10 |
|
% |
|
13 |
|
% |
General and administrative (1) |
64 |
|
% |
|
49 |
|
% |
|
59 |
|
% |
|
50 |
|
% |
Depreciation and amortization |
6 |
|
% |
|
7 |
|
% |
|
6 |
|
% |
|
7 |
|
% |
Total operating expenses |
135 |
|
% |
|
137 |
|
% |
|
131 |
|
% |
|
137 |
|
% |
Loss from operations |
(35 |
) |
% |
|
(37 |
) |
% |
|
(31 |
) |
% |
|
(37 |
) |
% |
Other income (expense), net: |
|
|
|
|
|
|
|
Interest income |
— |
|
% |
|
— |
|
% |
|
— |
|
% |
|
1 |
|
% |
Interest expense |
(2 |
) |
% |
|
(3 |
) |
% |
|
(2 |
) |
% |
|
(1 |
) |
% |
Change in fair value of redeemable convertible preferred
stock warrant liability |
— |
|
% |
|
— |
|
% |
|
— |
|
% |
|
(4 |
) |
% |
Total other expense, net |
(2 |
) |
% |
|
(2 |
) |
% |
|
(2 |
) |
% |
|
(5 |
) |
% |
Loss before income taxes |
(38 |
) |
% |
|
(39 |
) |
% |
|
(33 |
) |
% |
|
(41 |
) |
% |
Provision for (benefit from) income taxes |
(3 |
) |
% |
|
— |
|
% |
|
— |
|
% |
|
— |
|
% |
Net loss |
(34 |
) |
% |
|
(39 |
) |
% |
|
(33 |
) |
% |
|
(41 |
) |
% |
Less: Net loss attributable to noncontrolling
interest |
— |
|
% |
|
— |
|
% |
|
— |
|
% |
|
— |
|
% |
Net loss attributable to 1Life Healthcare, Inc. stockholders |
(34 |
) |
% |
|
(39 |
) |
% |
|
(33 |
) |
% |
|
(41 |
) |
% |
|
|
|
|
|
|
|
|
(1) Includes stock-based compensation, as
follows:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
Sales and marketing |
1 |
% |
|
1 |
% |
|
1 |
% |
|
1 |
% |
General and administrative |
21 |
% |
|
10 |
% |
|
21 |
% |
|
11 |
% |
Total |
22 |
% |
|
11 |
% |
|
22 |
% |
|
12 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Components of Net Revenue:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
Percentage of net
revenue: |
|
|
|
|
|
|
|
Net patient service revenue |
36 |
% |
|
31 |
% |
|
36 |
% |
|
37 |
% |
Partnership revenue |
47 |
% |
|
44 |
% |
|
46 |
% |
|
40 |
% |
Total net patient service and partnership revenue |
83 |
% |
|
74 |
% |
|
82 |
% |
|
77 |
% |
Membership revenue |
17 |
% |
|
23 |
% |
|
17 |
% |
|
21 |
% |
Grant income |
— |
% |
|
3 |
% |
|
1 |
% |
|
2 |
% |
Net revenue |
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
*Percentages may not sum due to rounding.
CONDENSED CONSOLIDATED BALANCE
SHEETS(Amounts in thousands, except par value
amounts)(unaudited)
|
June 30, |
|
December 31, |
|
2021 |
|
2020 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
503,238 |
|
|
$ |
112,975 |
|
Short-term marketable securities |
150,559 |
|
|
570,023 |
|
Accounts receivable, net |
55,982 |
|
|
67,895 |
|
Inventories |
3,950 |
|
|
7,113 |
|
Prepaid expenses and other current assets |
43,025 |
|
|
16,693 |
|
Total current assets |
756,754 |
|
|
774,699 |
|
Restricted cash |
1,895 |
|
|
1,911 |
|
Property and equipment, net |
144,770 |
|
|
126,037 |
|
Right-of-use assets |
165,653 |
|
|
138,840 |
|
Goodwill |
26,866 |
|
|
21,301 |
|
Deferred income taxes |
2,656 |
|
|
2,656 |
|
Other assets |
29,047 |
|
|
5,546 |
|
Total assets |
$ |
1,127,641 |
|
|
$ |
1,070,990 |
|
Liabilities and
Stockholders' Equity |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
12,462 |
|
|
$ |
12,654 |
|
Accrued expenses |
56,037 |
|
|
46,527 |
|
Deferred revenue, current |
43,605 |
|
|
35,966 |
|
Operating lease liabilities, current |
20,656 |
|
|
17,418 |
|
Other current liabilities |
21,988 |
|
|
4,861 |
|
Total current liabilities |
154,748 |
|
|
117,426 |
|
Operating lease liabilities,
non-current |
181,952 |
|
|
153,614 |
|
Convertible senior notes |
308,907 |
|
|
241,233 |
|
Deferred revenue,
non-current |
6,750 |
|
|
7,624 |
|
Other non-current
liabilities |
2,840 |
|
|
2,618 |
|
Total liabilities |
655,197 |
|
|
522,515 |
|
Commitments and
contingencies |
|
|
|
Stockholders' Equity: |
|
|
|
Common stock, $0.001 par value, 1,000,000 and 1,000,000 shares
authorized as of June 30, 2021 and December 31, 2020,
respectively; 137,774 and 134,472 shares issued and outstanding as
of June 30, 2021 and December 31, 2020, respectively |
138 |
|
|
134 |
|
Additional paid-in capital |
916,460 |
|
|
918,118 |
|
Accumulated deficit |
(444,162 |
) |
|
(369,785 |
) |
Accumulated other comprehensive income |
8 |
|
|
8 |
|
Total stockholders' equity |
472,444 |
|
|
548,475 |
|
Total liabilities and stockholders' equity |
$ |
1,127,641 |
|
|
$ |
1,070,990 |
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS(Amounts in
thousands) (unaudited)
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
Cash flows from operating
activities: |
|
|
|
Net loss |
$ |
(80,605 |
) |
|
$ |
(64,858 |
) |
Adjustments to reconcile net loss
to net cash provided by (used in) operating activities: |
|
|
|
Provision for bad debts |
105 |
|
|
213 |
|
Depreciation and amortization |
13,899 |
|
|
10,388 |
|
Amortization of debt discount and issuance costs |
937 |
|
|
1,135 |
|
Accretion of discounts and amortization of premiums on short-term
investments, net |
483 |
|
|
(520 |
) |
Change in fair value of redeemable convertible preferred stock
warrant liability |
— |
|
|
6,560 |
|
Reduction of operating lease right-of-use assets |
8,609 |
|
|
6,575 |
|
Stock-based compensation |
52,660 |
|
|
18,688 |
|
Other non-cash items |
400 |
|
|
(10 |
) |
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable, net |
11,380 |
|
|
(13,591 |
) |
Inventories |
3,216 |
|
|
93 |
|
Prepaid expenses and other current assets |
(21,261 |
) |
|
1,118 |
|
Other assets |
110 |
|
|
(250 |
) |
Accounts payable |
1,234 |
|
|
(2,110 |
) |
Accrued expenses |
6,772 |
|
|
12,893 |
|
Deferred revenue |
6,765 |
|
|
16,051 |
|
Operating lease liabilities |
(8,761 |
) |
|
(5,132 |
) |
Other liabilities |
17,128 |
|
|
2,652 |
|
Net cash provided by (used in) operating activities |
13,071 |
|
|
(10,105 |
) |
Cash flows from investing
activities: |
|
|
|
Purchases of property and
equipment |
(31,172 |
) |
|
(39,554 |
) |
Purchases of short-term
marketable securities |
(79,984 |
) |
|
(367,367 |
) |
Proceeds from sales and
maturities of short-term marketable securities |
498,977 |
|
|
123,314 |
|
Acquisitions of businesses |
(9,695 |
) |
|
— |
|
Issuance of note receivable |
(20,000 |
) |
|
— |
|
VIE deconsolidation |
— |
|
|
(810 |
) |
Net cash provided by (used in) investing activities |
358,126 |
|
|
(284,417 |
) |
Cash flows from financing
activities: |
|
|
|
Proceeds from issuance of
convertible senior notes |
— |
|
|
316,250 |
|
Payment of convertible senior
notes issuance costs |
— |
|
|
(8,756 |
) |
Proceeds from initial public
offering |
— |
|
|
281,750 |
|
Payment of underwriting discount
and commissions, and offering costs |
— |
|
|
(21,322 |
) |
Proceeds from the exercise of
stock options |
16,107 |
|
|
2,096 |
|
Proceeds from employee stock
purchase plan |
2,972 |
|
|
— |
|
Proceeds from the exercise of
redeemable convertible preferred and common stock warrants |
— |
|
|
110 |
|
Repayment of notes payable |
— |
|
|
(2,200 |
) |
Payment of principal portion of
finance lease liability |
(29 |
) |
|
(29 |
) |
Net cash provided by financing activities |
19,050 |
|
|
567,899 |
|
Net increase in cash,
cash equivalents and restricted cash |
390,247 |
|
|
273,377 |
|
Cash, cash equivalents and
restricted cash at beginning of period |
115,005 |
|
|
29,329 |
|
Cash, cash equivalents and
restricted cash at end of period |
$ |
505,252 |
|
|
$ |
302,706 |
|
Supplemental disclosure
of non-cash investing and financing activities: |
|
|
|
Purchases of property and
equipment included in accounts payable and accrued expenses |
$ |
5,883 |
|
|
$ |
3,620 |
|
Issuance costs in connection to
convertible senior notes included in accounts payable and accrued
expenses |
$ |
— |
|
|
$ |
625 |
|
Reimbursement of secondary
offering costs in prepaid expenses and other current assets |
$ |
— |
|
|
$ |
784 |
|
Select Metrics (As of Period
End)
|
|
June 30,2021 |
|
March 31,2021 |
|
December 31,2020 |
|
September 30,2020 |
|
June 30,2020 |
|
March 31,2020 |
|
December 31,2019 |
|
September 30,2019 |
Members |
|
621,000 |
|
|
598,000 |
|
|
549,000 |
|
|
511,000 |
|
|
475,000 |
|
|
455,000 |
|
|
422,000 |
|
|
397,000 |
|
Offices |
|
124 |
|
|
110 |
|
|
107 |
|
|
103 |
|
|
96 |
|
|
92 |
|
|
83 |
|
|
77 |
|
RECONCILIATION OF LOSS FROM OPERATIONS TO
CARE MARGIN
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
|
|
(in thousands) |
Loss from operations |
$ |
(42,564 |
) |
|
|
$ |
(28,713 |
) |
|
|
$ |
(74,945 |
) |
|
|
$ |
(57,741 |
) |
|
Sales and marketing* |
10,570 |
|
|
|
9,777 |
|
|
|
23,259 |
|
|
|
20,933 |
|
|
General and administrative* |
77,196 |
|
|
|
38,311 |
|
|
|
141,541 |
|
|
|
78,177 |
|
|
Depreciation and amortization |
7,292 |
|
|
|
5,175 |
|
|
|
13,899 |
|
|
|
10,388 |
|
|
Care
margin |
$ |
52,494 |
|
|
|
$ |
24,550 |
|
|
|
$ |
103,754 |
|
|
|
$ |
51,757 |
|
|
Care margin as a percentage of
net revenue |
44 |
|
% |
|
31 |
|
% |
|
43 |
|
% |
|
33 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Includes stock-based compensation |
RECONCILIATION OF NET LOSS TO ADJUSTED
EBITDA
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
|
|
(in thousands) |
Net loss |
$ |
(41,287 |
) |
|
$ |
(30,301 |
) |
|
$ |
(80,605 |
) |
|
$ |
(64,858 |
) |
Interest income |
(79 |
) |
|
(366 |
) |
|
(184 |
) |
|
(1,400 |
) |
Interest expense |
2,842 |
|
|
1,976 |
|
|
5,685 |
|
|
2,029 |
|
Depreciation and
amortization |
7,292 |
|
|
5,175 |
|
|
13,899 |
|
|
10,388 |
|
Stock-based compensation |
26,332 |
|
|
8,363 |
|
|
52,660 |
|
|
18,688 |
|
Change in fair value of redeemable convertible preferred stock
warrant liability |
— |
|
|
— |
|
|
— |
|
|
6,560 |
|
Provision for (benefit from)
income taxes |
(4,040 |
) |
|
(22 |
) |
|
159 |
|
|
(72 |
) |
Legal or advisory costs
(1) |
11,282 |
|
|
— |
|
|
$ |
15,567 |
|
|
$ |
— |
|
Acquisition and integration
costs |
$ |
4,597 |
|
|
$ |
— |
|
|
$ |
4,597 |
|
|
$ |
— |
|
Adjusted
EBITDA |
$ |
6,939 |
|
|
$ |
(15,175 |
) |
|
$ |
11,778 |
|
|
$ |
(28,665 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1 |
) |
Approximately $5,550 of the legal or advisory costs relate to a
legal settlement during the three and six months ended June 30,
2021. |
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