Streamline Health Solutions,
Inc. (“Streamline” or the “Company”) (Nasdaq:
STRM), a leading provider of solutions that enable
healthcare providers to proactively address revenue leakage and
improve financial performance, today announced financial results
for the second quarter of 2023 which ended July 31, 2023.
Fiscal Second Quarter and Six Months
Ended July 31, 2023 GAAP
Financial Results
The following financial results have been
prepared in accordance with Generally Accepted Accounting
Principles (“GAAP”).
Total revenue for the second quarter of fiscal
2023 was $5.8 million as compared to $6.0 million during the second
quarter of fiscal 2022. For the six months ended July 31, 2023,
revenue totaled $11.1 million as compared to $11.9 million during
the same period of fiscal 2022. The change in total revenue was
attributable to lower professional services revenue offset by
higher SaaS revenue. As previously reported, the Company had a
large professional services contract which did not renew at the end
of its 2022 fiscal year. This professional services product is not
expected to be part of the Company’s core business going
forward.
During the second quarter and first six months
of fiscal 2023, SaaS revenue grew $0.4 million and $0.8 million,
respectively, as compared to the prior year periods.
Net loss for the second quarter of fiscal 2023
was ($2.5 million) compared to a net a loss of ($3.3 million)
during the second quarter of fiscal 2022. For the first six months
of fiscal 2023, net loss totaled ($5.4 million) compared to a net
loss of ($6.1 million) during the first six months of fiscal 2022.
The improvement in net loss was the result of lower headcount
associated with the non-renewal of a large professional services
contract, as well as cost savings achieved through the previously
announced integration of the Avelead and eValuator divisions and
non-cash valuation adjustments. The Company believes the decreased
net loss on lower total revenue demonstrates the value of growing
our high-margin SaaS business.
Fiscal Second Quarter and Six Months
Ended July 31, 2023 Non-GAAP
Financial Results
Adjusted EBITDA for the second quarter of fiscal
2023 was ($0.9 million) compared to ($1.1 million) during the
second quarter of fiscal 2022. For the six months ended July 31,
2023, adjusted EBITDA was ($2.2 million) compared to ($2.4 million)
during the six months ended July 31, 2022.
As of July 31, 2023, the Company’s total Booked
SaaS Annual Contract Value (“ACV”) was $17.6 million compared to
$17.2 million as of January 31, 2023. $3.4 million of the Booked
SaaS ACV was unimplemented as of July 31, 2023. Booked SaaS ACV
represents the annualized value of all executed SaaS contracts,
including contracts that have not been fully implemented as of the
measurement date, assuming any contract that expires during the
twelve months following the measurement date is renewed on its
existing terms unless the Company has knowledge of the
non-renewal.
Management Commentary
“The Streamline Health team has made significant
progress as an organization in fiscal 2023. Our innovation team
made significant advancements during the first half of the year
which we expect to result in improved implementation timelines and
lower expenses, while the services team has ensured our clients are
receiving world-class support regardless of solution,” stated Tee
Green, Chief Executive Officer, Streamline Health. “While our
growth team has been encumbered by significant macro headwinds,
health systems remain excited about the potential to transform
their revenue cycle with our suite of pre-bill solutions which
ensure they are accurately paid for all of the care they’ve
provided.”
Conference Call
The Company will conduct a conference call on
Thursday, September 14, 2023, at 9:00 AM ET to review results and
provide a corporate update. Interested parties can access the call
by joining the live webcast: click here to register. You can also
join by phone by dialing 877-407-8291. Following the conference
call, management will host one-on-one meetings at the Lake Street
Capital Markets 7th Annual Best Ideas Growth Conference in New
York, NY.
A replay of the conference call will be
available from Thursday, September 14, 2023, at 12:00 PM ET to
Thursday, September 21, 2023, at 12:00 PM ET by dialing
877-660-6853 or 201-612-7415 with conference ID 13741041. An online
replay of the presentation will also be available for six months
following the presentation in the Investor Relations section of the
Streamline website, www.streamlinehealth.net.
About Streamline Health
Streamline Health Solutions, Inc. (Nasdaq:
STRM) enables healthcare organizations to proactively address
revenue leakage and improve financial performance. We deliver
integrated solutions, technology-enabled services and analytics
that drive compliant revenue leading to improved financial
performance across the enterprise. For more information,
visit www.streamlinehealth.net.
Non-GAAP Financial Measures
Streamline reports its financial results in
accordance with U.S. generally accepted accounting
principles (“GAAP”). Streamline’s management also evaluates and
makes operating decisions using various other measures. One such
measure is adjusted EBITDA, which is a non-GAAP financial measure.
Streamline’s management believes that this measure provides useful
supplemental information regarding the performance of Streamline’s
business operations.
Streamline defines “adjusted
EBITDA” as net earnings (loss) plus interest expense, tax
expense, depreciation and amortization expense of tangible and
intangible assets, share-based compensation expense,
significant non-recurring operating expenses, and transactional
related expenses including: gains and losses on debt and
equity conversions, associate severances and related restructuring
expenses, associate inducements, and professional and advisory
fees. A table reconciling this measure to “loss from
continuing operations” is included in this press release.
Booked SaaS ACV represents the annualized value
of all executed SaaS contracts, including contracts that have not
been fully implemented, as of the measurement date, assuming any
contract that expires during the twelve months following the
measurement date is renewed on its existing terms unless the
Company has knowledge of the non-renewal. Booked SaaS ACV
should be viewed independently of revenue and does not represent
revenue calculated in accordance with GAAP on an annualized basis,
as it is an operating metric that can be impacted by contract
execution start and end dates and renewal rates. Booked
SaaS ACV is not intended to be a replacement for, or forecast
of, revenue. There is no GAAP measure comparable to Booked
SaaS ACV.
Safe Harbor Statement under the
Private Securities Litigation Reform Act of 1995
Statements made by Streamline Health
Solutions, Inc. that are not historical facts are
forward-looking statements that are subject to certain risks,
uncertainties and important factors that could cause actual results
to differ materially from those reflected in the forward-looking
statements included herein. Forward-looking statements contained in
this press release include, without limitation, statements
regarding the Company’s growth prospects, anticipated
bookings, recognition of revenue from contracts included in
Booked SaaS ACV, anticipated cost savings, expected improved
implementation timelines and lower expenses for our clients,
industry trends and market growth, adjusted EBITDA, success of
future products and related expectations and assumptions. These
risks and uncertainties include, but are not limited to, the timing
of contract negotiations and execution of contracts and the related
timing of the revenue recognition related thereto, the potential
cancellation of existing contracts or clients not completing
projects included in the backlog and Booked SaaS ACV, the
impact of competitive solutions and pricing, solution demand and
market acceptance, new solution development and enhancement of
current solutions, key strategic alliances with vendors and channel
partners that resell the Company’s solutions, the ability of the
Company to generate cash from operations, the availability of
additional debt and equity financing to fund the Company’s ongoing
operations, the ability of the Company to control costs, the
effects of cost-containment measures implemented by the Company,
availability of solutions from third party vendors, the healthcare
regulatory environment, potential changes in legislation,
regulation and government funding affecting the healthcare
industry, healthcare information systems budgets, availability of
healthcare information systems trained personnel for implementation
of new systems, as well as maintenance of legacy systems,
fluctuations in operating results, effects of critical accounting
policies and judgments, changes in accounting policies or
procedures as may be required by the Financial Accounting
Standards Board or other similar entities, changes in
economic, business and market conditions impacting the healthcare
industry generally and the markets in which the Company operates
and nationally, the Company’s ability to maintain compliance with
the terms of its credit facilities, and other risks detailed from
time to time in the Streamline Health Solutions,
Inc. filings with the U. S. Securities and Exchange
Commission. Readers are cautioned not to place undue reliance on
these forward-looking statements, which reflect management’s
analysis only as of the date hereof. The Company undertakes no
obligation to publicly release the results of any revision to these
forward-looking statements, which may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events, except as required by law.
Company Contact
Jacob GoldbergerDirector, Investor Relations and
FP&A303-887-9625jacob.goldberger@streamlinehealth.net
STREAMLINE HEALTH SOLUTIONS,
INC.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(rounded
to the nearest thousand dollars, except share and per share
information)
|
|
Three Months Ended July 31, |
|
|
Six Months Ended July 31, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software as a service |
|
$ |
3,531,000 |
|
|
$ |
3,117,000 |
|
|
$ |
6,706,000 |
|
|
$ |
5,948,000 |
|
Maintenance and support |
|
|
1,100,000 |
|
|
|
1,118,000 |
|
|
|
2,257,000 |
|
|
|
2,228,000 |
|
Professional fees and licenses |
|
|
1,139,000 |
|
|
|
1,757,000 |
|
|
|
2,139,000 |
|
|
|
3,751,000 |
|
Total revenues |
|
|
5,770,000 |
|
|
|
5,992,000 |
|
|
|
11,102,000 |
|
|
|
11,927,000 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of software as a service |
|
|
1,893,000 |
|
|
|
1,532,000 |
|
|
|
3,482,000 |
|
|
|
3,029,000 |
|
Cost of maintenance and support |
|
|
32,000 |
|
|
|
90,000 |
|
|
|
121,000 |
|
|
|
136,000 |
|
Cost of professional fees and licenses |
|
|
1,022,000 |
|
|
|
1,582,000 |
|
|
|
2,130,000 |
|
|
|
3,248,000 |
|
Selling, general and administrative expense |
|
|
4,107,000 |
|
|
|
3,934,000 |
|
|
|
7,913,000 |
|
|
|
8,435,000 |
|
Research and development |
|
|
1,305,000 |
|
|
|
1,461,000 |
|
|
|
3,006,000 |
|
|
|
2,773,000 |
|
Acquisition-related costs |
|
|
9,000 |
|
|
|
49,000 |
|
|
|
44,000 |
|
|
|
139,000 |
|
Total operating expenses |
|
|
8,368,000 |
|
|
|
8,648,000 |
|
|
|
16,696,000 |
|
|
|
17,760,000 |
|
Operating loss |
|
|
(2,598,000 |
) |
|
|
(2,656,000 |
) |
|
|
(5,594,000 |
) |
|
|
(5,833,000 |
) |
Other (expense)
income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(267,000 |
) |
|
|
(189,000 |
) |
|
|
(515,000 |
) |
|
|
(321,000 |
) |
Acquisition earnout valuation adjustments |
|
|
359,000 |
|
|
|
(475,000 |
) |
|
|
723,000 |
|
|
|
25,000 |
|
Other |
|
|
(1,000 |
) |
|
|
50,000 |
|
|
|
31,000 |
|
|
|
83,000 |
|
Loss before income taxes |
|
|
(2,507,000 |
) |
|
|
(3,270,000 |
) |
|
|
(5,355,000 |
) |
|
|
(6,046,000 |
) |
Income tax expense |
|
|
(8,000 |
) |
|
|
(2,000 |
) |
|
|
(61,000 |
) |
|
|
(13,000 |
) |
Net loss |
|
$ |
(2,515,000 |
) |
|
$ |
(3,272,000 |
) |
|
$ |
(5,416,000 |
) |
|
$ |
(6,059,000 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted Earnings Per
Share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share –
basic and diluted |
|
$ |
(0.04 |
) |
|
$ |
(0.07 |
) |
|
$ |
(0.10 |
) |
|
$ |
(0.13 |
) |
Weighted average number of
common shares – basic and diluted |
|
|
56,357,684 |
|
|
|
47,231,296 |
|
|
|
56,164,282 |
|
|
|
47,129,879 |
|
STREAMLINE HEALTH SOLUTIONS,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETS
(rounded
to the nearest thousand dollars, except share and per share
information)
|
|
July 31, 2023 |
|
|
January 31, 2023 |
|
|
|
(Unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
4,087,000 |
|
|
$ |
6,598,000 |
|
Accounts receivable, net of allowance for credit losses of $94,000
and $132,000, respectively |
|
|
2,790,000 |
|
|
|
7,719,000 |
|
Contract receivables |
|
|
940,000 |
|
|
|
960,000 |
|
Prepaid and other current assets |
|
|
895,000 |
|
|
|
710,000 |
|
Total current assets |
|
|
8,712,000 |
|
|
|
15,987,000 |
|
Non-current
assets: |
|
|
|
|
|
|
|
|
Property and equipment, net of accumulated amortization of $266,000
and $246,000 respectively |
|
|
106,000 |
|
|
|
79,000 |
|
Right-of use asset for operating lease |
|
|
— |
|
|
|
32,000 |
|
Capitalized software development costs, net of accumulated
amortization of $7,107,000 and $6,224,000, respectively |
|
|
6,105,000 |
|
|
|
5,846,000 |
|
Intangible assets, net of accumulated amortization of $3,527,000
and $2,627,000, respectively |
|
|
13,893,000 |
|
|
|
14,793,000 |
|
Goodwill |
|
|
23,089,000 |
|
|
|
23,089,000 |
|
Other |
|
|
1,410,000 |
|
|
|
1,695,000 |
|
Total non-current assets |
|
|
44,603,000 |
|
|
|
45,534,000 |
|
Total
assets |
|
$ |
53,315,000 |
|
|
$ |
61,521,000 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
657,000 |
|
|
$ |
626,000 |
|
Accrued expenses |
|
|
1,939,000 |
|
|
|
3,265,000 |
|
Current portion of term loan |
|
|
1,000,000 |
|
|
|
750,000 |
|
Deferred revenues |
|
|
6,724,000 |
|
|
|
8,361,000 |
|
Current portion of operating lease obligation |
|
|
— |
|
|
|
35,000 |
|
Acquisition earnout liability |
|
|
3,015,000 |
|
|
|
3,738,000 |
|
Total current liabilities |
|
|
13,335,000 |
|
|
|
16,775,000 |
|
Non-current
liabilities: |
|
|
|
|
|
|
|
|
Term loan, net of current portion and deferred financing costs |
|
|
8,517,000 |
|
|
|
8,964,000 |
|
Deferred revenues, less current portion |
|
|
212,000 |
|
|
|
167,000 |
|
Other non-current liabilities |
|
|
147,000 |
|
|
|
104,000 |
|
Total non-current liabilities |
|
|
8,876,000 |
|
|
|
9,235,000 |
|
Total liabilities |
|
|
22,211,000 |
|
|
|
26,010,000 |
|
Stockholders’
equity: |
|
|
|
|
|
|
|
|
Common stock, $0.01 par value per share, 85,000,000 shares
authorized; 58,895,071 and 57,567,210 shares issued and
outstanding, respectively |
|
|
589,000 |
|
|
|
576,000 |
|
Additional paid in capital |
|
|
132,933,000 |
|
|
|
131,973,000 |
|
Accumulated deficit |
|
|
(102,418,000 |
) |
|
|
(97,038,000 |
) |
Total stockholders’ equity |
|
|
31,104,000 |
|
|
|
35,511,000 |
|
Total liabilities and
stockholders’ equity |
|
$ |
53,315,000 |
|
|
$ |
61,521,000 |
|
STREAMLINE HEALTH SOLUTIONS,
INC.UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS
(rounded
to the nearest thousand dollars)
|
|
Six Months Ended July 31, |
|
|
|
2023 |
|
|
2022 |
|
Net loss |
|
$ |
(5,416,000 |
) |
|
$ |
(6,059,000 |
) |
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
2,134,000 |
|
|
|
2,199,000 |
|
Acquisition earnout valuation adjustments |
|
|
(723,000 |
) |
|
|
(25,000 |
) |
Provision for deferred income taxes |
|
|
43,000 |
|
|
|
— |
|
Share-based compensation expense |
|
|
1,109,000 |
|
|
|
657,000 |
|
Provision for credit losses |
|
|
— |
|
|
|
21,000 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts and contract receivables |
|
|
4,985,000 |
|
|
|
329,000 |
|
Other assets |
|
|
(146,000 |
) |
|
|
(742,000 |
) |
Accounts payable |
|
|
31,000 |
|
|
|
(109,000 |
) |
Accrued expenses and other liabilities |
|
|
(1,361,000 |
) |
|
|
364,000 |
|
Deferred revenue |
|
|
(1,592,000 |
) |
|
|
414,000 |
|
Net cash used in operating
activities |
|
|
(936,000 |
) |
|
|
(2,951,000 |
) |
Cash flows from investing
activities: |
|
|
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(47,000 |
) |
|
|
(10,000 |
) |
Capitalization of software development costs |
|
|
(1,026,000 |
) |
|
|
(871,000 |
) |
Net cash used in investing
activities |
|
|
(1,073,000 |
) |
|
|
(881,000 |
) |
Cash flows from financing
activities: |
|
|
|
|
|
|
|
|
Repayment of bank term loan |
|
|
(250,000 |
) |
|
|
— |
|
Payments related to settlement of employee share-based awards |
|
|
(252,000 |
) |
|
|
(141,000 |
) |
Other |
|
|
— |
|
|
|
6,000 |
|
Net cash used in financing
activities |
|
|
(502,000 |
) |
|
|
(135,000 |
) |
Net decrease in cash and cash
equivalents |
|
|
(2,511,000 |
) |
|
|
(3,967,000 |
) |
Cash and cash equivalents at
beginning of period |
|
|
6,598,000 |
|
|
|
9,885,000 |
|
Cash and cash equivalents at
end of period |
|
$ |
4,087,000 |
|
|
$ |
5,918,000 |
|
STREAMLINE HEALTH SOLUTIONS,
INC.NEW BOOKINGS
(Unaudited, rounded to the nearest
thousand dollars)
|
|
July 31, 2023 |
|
|
Three Months Ended |
Six Months Ended |
Software as a service |
|
765,000 |
2,841,000 |
Maintenance and support |
|
- |
- |
Professional fees
and licenses |
266,000 |
364,000 |
Q2
2023
Bookings |
$ |
1,031,000 |
3,205,000 |
Q2
2022
Bookings |
$ |
5,152,000 |
14,015,000 |
STREAMLINE HEALTH SOLUTIONS,
INC.RECONCILIATION OF NET LOSS TO
NON-GAAP ADJUSTED EBITDA
(Unaudited,
in thousands)
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
July 31, 2023 |
|
|
July 31, 2022 |
|
|
July 31, 2023 |
|
|
July 31, 2022 |
|
Adjusted EBITDA
Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing
operations |
|
$ |
(2,515 |
) |
|
$ |
(3,272 |
) |
|
$ |
(5,416 |
) |
|
$ |
(6,059 |
) |
Interest expense |
|
|
267 |
|
|
|
189 |
|
|
|
515 |
|
|
|
321 |
|
Income tax expense |
|
|
8 |
|
|
|
2 |
|
|
|
61 |
|
|
|
13 |
|
Depreciation and amortization |
|
|
1,050 |
|
|
|
1,076 |
|
|
|
2,081 |
|
|
|
2,159 |
|
EBITDA |
|
$ |
(1,190 |
) |
|
$ |
(2,005 |
) |
|
$ |
(2,759 |
) |
|
$ |
(3,566 |
) |
Share-based compensation expense |
|
|
537 |
|
|
|
331 |
|
|
|
1,109 |
|
|
|
657 |
|
Non-cash valuation adjustments |
|
|
(359 |
) |
|
|
475 |
|
|
|
(723 |
) |
|
|
(25 |
) |
Acquisition-related costs, severance, and transaction-related
bonuses |
|
|
119 |
|
|
|
122 |
|
|
|
176 |
|
|
|
623 |
|
Other non-recurring charges |
|
|
— |
|
|
|
(19 |
) |
|
|
(33 |
) |
|
|
(67 |
) |
Adjusted EBITDA |
|
$ |
(893 |
) |
|
$ |
(1,096 |
) |
|
$ |
(2,230 |
) |
|
$ |
(2,378 |
) |
Streamline Health Soluti... (NASDAQ:STRM)
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