TruBridge, Inc. (NASDAQ: TBRG), a healthcare solutions company,
today announced financial results for the first quarter ended March
31, 2024.
First Quarter 2024 Highlights
All comparisons are to the quarter ended March 31, 2023, unless
otherwise noted
- Bookings of $23.6 million compared to $19.8 million
- Total revenue of $83.2 million compared to $86.2 million
- Revenue Cycle Management (RCM) revenue of $53.0 million
compared to $48.6 million
- RCM revenue represented 63.7% of TruBridge’s total revenue
- GAAP (loss) earnings per diluted share of $(0.17) compared to
$0.21
- Non-GAAP earnings per diluted share of $0.19 compared to
$0.58
- Adjusted EBITDA of $9.5 million compared to $14.6 million
Commenting on the results, Chris Fowler, chief executive officer
of TruBridge, Inc., stated, “We continued to make significant
progress on our transformation efforts during the first quarter,
and we remained focused on the key areas that we believe will drive
results. The refinement of our financial operations gives us
enhanced capabilities in regard to accurate forecasting, an
improved capital allocation strategy and identification of cost
savings opportunities and provides us a more stable foundation from
which to grow.”
“We were pleased with the continued momentum in bookings this
quarter, which came in at $23 million and reflected wins in both
our RCM and our EHR business, as well as the growth in our pipeline
especially in the larger deals that we’ve started to move towards
in the past few quarters. Our success in capturing these larger
deals in our RCM business does bring an added layer of timing
complexity from contracting to implementation. As a result, to
reflect the variability in time to convert larger deals, we feel
it’s prudent to slightly revise our full-year revenue range. The
work we have done on expense management, however, has put us in a
strong position in terms of our profitability, allowing us to
maintain our previous adjusted EBITDA outlook this year.
“TruBridge operates in an area of the market with tremendous
need, and our solutions address many of them. We remain confident
we can continue to deliver for our customers and shareholders,”
concluded Fowler.
Financial Guidance
For the second quarter of 2024, TruBridge expects to
generate:
- Total revenue of $81 million to $83 million
- Adjusted EBITDA of $8.0 million to $10.0 million
For the full year 2024, TruBridge expects to generate:
- Total revenue of $330 million to $340 million; revised from
$340 million to $350 million
- Adjusted EBITDA of $45 million to $50 million; unchanged
Conference Call
TruBridge will hold a live webcast to discuss first quarter 2024
results on Friday, May 10, 2024, at 7:00 a.m. Central time/8:00
a.m. Eastern time. A 30-day online replay will be available
approximately one hour following the conclusion of the live
webcast. To listen to the live webcast or access the replay, visit
the Company’s investor relations website,
investors.trubridge.com.
About TruBridge
We are a trusted partner to more than 1,500 healthcare
organizations with a broad range of technology-first solutions that
address the unique needs and challenges of diverse communities,
promoting equitable access to quality care and fostering positive
outcomes. TruBridge has over four decades of experience in
connecting providers, patients and communities with innovative
data-driven solutions that create real value by supporting both the
financial and clinical side of healthcare delivery. Our industry
leading HFMA Peer Reviewed® suite of revenue cycle management (RCM)
offerings combine unparalleled visibility and transparency to
enhance productivity and support the financial health of healthcare
organizations across all care settings. We support efficient
patient care with electronic health record (EHR) product offerings
that successfully integrate data between care settings. Above all,
we believe in the power of community and encourage collaboration,
connection, and empowerment with our customers. We clear the way
for care. For more information, please visit www.trubridge.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified generally by the use of
forward-looking terminology and words such as “expects,”
“anticipates,” “estimates,” “believes,” “predicts,” “intends,”
“plans,” “potential,” “may,” “continue,” “should,” “will” and words
of comparable meaning. Without limiting the generality of the
preceding statement, all statements in this press release relating
to the Company’s future financial and operational results are
forward-looking statements. We caution investors that any such
forward‑looking statements are only predictions and are not
guarantees of future performance. Certain risks, uncertainties and
other factors may cause actual results to differ materially from
those projected in the forward‑looking statements. Such factors may
include: saturation of our target market and hospital
consolidations; unfavorable economic or market conditions that may
cause a decline in spending for information technology and
services; significant legislative and regulatory uncertainty in the
healthcare industry; exposure to liability for failure to comply
with regulatory requirements; pandemics and other public health
crises and related economic disruptions; transition to a
subscription-based recurring revenue model and modernization of our
technology; competition with companies that have greater financial,
technical and marketing resources than we have; potential future
acquisitions that may be expensive, time consuming, and subject to
other inherent risks; our ability to attract and retain qualified
client service and support personnel; disruption from periodic
restructuring of our sales force; potential delay in the
development of markets for our RCM service offering; potential
inability to properly manage growth in new markets we may enter;
potential disruption of our business due to our ongoing
implementation of a new enterprise resource planning software
solution; exposure to numerous and often conflicting laws,
regulations, policies, standards or other requirements through our
international business activities; potential litigation against us;
our reliance on an international workforce which exposes us to
various business disruptions; our utilization of artificial
intelligence, which could expose us to liability or adversely
affect our business if we cannot compete effectively with others
using artificial intelligence; potential failure to develop new
products or enhance current products that keep pace with market
demands; failure of our products to function properly resulting in
claims for medical and other losses; breaches of security and
viruses in our systems resulting in customer claims against us and
harm to our reputation; failure to maintain customer satisfaction
through new product releases free of undetected errors or problems;
failure to convince customers to migrate to current or future
releases of our products; failure to maintain our margins and
service rates; increase in the percentage of total revenues
represented by service revenues, which have lower gross margins;
exposure to liability in the event we provide inaccurate claims
data to payors; exposure to liability claims arising out of the
licensing of our software and provision of services; dependence on
licenses of rights, products and services from third parties;
misappropriation of our intellectual property rights and potential
intellectual property claims and litigation against us;
interruptions in our power supply and/or telecommunications
capabilities, including those caused by natural disaster; potential
inability to secure additional financing on favorable terms to meet
our future capital needs; our substantial indebtedness, and our
ability to incur additional indebtedness in the future; pressures
on cash flow to service our outstanding debt; restrictive terms of
our credit agreement on our current and future operations; changes
in and interpretations of financial accounting matters that govern
the measurement of our performance; significant charges to earnings
if our goodwill or intangible assets become impaired; fluctuations
in quarterly financial performance due to, among other factors,
timing of customer installations; volatility in our stock price;
failure to maintain effective internal control over financial
reporting; inherent limitations in our internal control over
financial reporting; vulnerability to significant damage from
natural disasters; market risks related to interest rate changes;
potential material adverse effects due to macroeconomic conditions,
including bank failures or changes in related regulation; and other
risk factors described from time to time in our public releases and
reports filed with the Securities and Exchange Commission,
including, but not limited to, our most recent Annual Report on
Form 10-K and our Quarterly Report on Form 10-Q for the quarter
ended March 31, 2024. We also caution investors that the
forward-looking information described herein represents our outlook
only as of this date, and we undertake no obligation to update or
revise any forward-looking statements to reflect events or
developments after the date of this press release.
TruBridge, Inc. Condensed Consolidated Statements of Income (In
'000s, except per share data) (Unaudited) Three Months Ended
March 31,
2024
2023
Revenues RCM
$
53,038
$
48,631
EHR
28,022
35,191
Patient engagement
2,187
2,411
Total revenues
83,247
86,233
Expenses Costs of revenue (exclusive of amortization
and depreciation) RCM
29,597
27,183
EHR
11,287
16,348
Patient engagement
875
646
Total costs of revenue (exclusive of amortization and depreciation)
41,759
44,177
Product development
10,689
8,352
Sales and marketing
6,592
6,957
General and administrative
19,396
14,453
Amortization
5,869
5,500
Depreciation
400
499
Total expenses
84,705
79,938
Operating income (loss)
(1,458
)
6,295
Other income (expense): Other income
1,422
267
Interest expense
(4,072
)
(2,669
)
Total other income (expense)
(2,650
)
(2,402
)
Income (loss) before taxes
(4,108
)
3,893
Provision (benefit) for income taxes
(1,592
)
809
Net income (loss)
$
(2,516
)
$
3,084
Net income (loss) per common share—basic
$
(0.17
)
$
0.21
Net income (loss) per common share—diluted
$
(0.17
)
$
0.21
Weighted average shares outstanding used in per common
share computations: Basic
14,234
14,136
Diluted
14,234
14,136
TruBridge, Inc. Condensed Consolidated Balance Sheets (In '000s,
except per share data) March 31, 2024(unaudited) Dec. 31,
2023
Assets Current assets Cash and cash equivalents
$
4,115
$
3,848
Accounts receivable, net of allowance for expected credit losses of
$3,773 and $3,631, respectively
64,218
59,723
Financing receivables, current portion (net of allowance for
expected credit losses of $304 and $319, respectively)
3,668
3,997
Inventories
980
475
Prepaid income taxes
1,151
1,628
Prepaid expenses and other
17,772
15,807
Assets of held for sale disposal group
-
25,977
Total current assets
91,904
111,455
Property & equipment, net
8,750
8,974
Software development costs, net
41,237
39,139
Operating lease assets
4,672
5,192
Financing receivables, net of current portion (net of allowance for
expected credit losses of $79 and $97, respectively)
959
1,226
Other assets, net of current portion
8,331
7,314
Intangible assets, net
86,086
89,213
Goodwill
172,573
171,909
Deferred tax assets
1,905
-
Total assets
$
416,417
$
434,422
Liabilities & Stockholders' Equity Current
liabilities Accounts payable
$
11,356
$
10,133
Current portion of long-term debt
3,074
3,141
Deferred revenue
9,079
8,677
Accrued vacation
5,429
5,410
Liabilities of held for sale disposal group
-
977
Other accrued liabilities
18,226
19,892
Total current liabilities
47,164
48,230
Long-term debt, net of current portion
181,732
195,270
Operating lease liabilities, net of current portion
2,848
3,074
Deferred tax liabilities
-
1,230
Total liabilities
231,744
247,804
Stockholders' Equity Common stock, $0.001 par value; 30,000
shares authorized; 15,572 and 15,121 shares issued, respectively
15
15
Treasury stock, 613 and 572 shares, respectively
(17,417
)
(17,075
)
Accumulated other comprehensive gain
113
-
Additional paid-in capital
196,346
195,546
Retained earnings
5,616
8,132
Total stockholders' equity
184,673
186,618
Total liabilities and stockholders' equity
$
416,417
$
434,422
TruBridge, Inc. Condensed Consolidated Statements of Cash Flows (In
'000s) (Unaudited) Three Months Ended March 31,
2024
2023
Operating activities: Net income (loss)
$
(2,516
)
$
3,084
Adjustments to net income: Provision for credit losses
500
(352
)
Deferred taxes
(2,982
)
572
Stock-based compensation
800
1,247
Depreciation
400
499
Gain on sale of business
(1,250
)
-
Amortization of acquisition-related intangibles
3,127
4,014
Amortization of software development costs
2,742
1,486
Amortization of deferred finance costs
107
90
Non-cash operating lease costs
675
479
Changes in operating assets and liabilities: Accounts receivable
(4,112
)
(3,099
)
Financing receivables
628
619
Inventories
(505
)
(398
)
Prepaid expenses and other
772
(3,187
)
Accounts payable
1,253
5,605
Deferred revenue
1,006
47
Operating lease liabilities
(583
)
(499
)
Other liabilities
(2,573
)
(971
)
Prepaid income taxes
477
237
Net cash used in (provided by) operating activities
(2,034
)
9,473
Investing activities: Purchase of business, net of
cash acquired
21,410
-
Investment in software development
(4,839
)
(6,233
)
Purchases of property and equipment
(177
)
(16
)
Net cash provided by (used in) investing activities
16,394
(6,249
)
Financing activities: Treasury stock purchases
(342
)
(2,484
)
Payments of long-term debt principal
(875
)
(875
)
Proceeds from revolving line of credit
15,423
5,000
Payments of revolving line of credit
(27,729
)
(5,000
)
Debt issuance cots
(529
)
-
Net cash used in financing activities
(14,052
)
(3,359
)
Decrease in cash and cash equivalents
308
(135
)
Change in cash and cash equivalents included in assets sold
(41
)
Cash and cash equivalents, beginning of period
3,848
6,951
Cash and cash equivalents, end of period
$
4,115
$
6,816
TruBridge, Inc. Consolidated Bookings (In '000s) (Unaudited)
Three Months Ended March 31, In '000s
2024
2023
RCM(1)
$
14,391
$
12,100
EHR(2)
8,610
7,271
Patient engagement(1)
568
476
Total
$
23,569
$
19,847
(1)
Generally calculated as the total contract price (for
non-recurring, project-related amounts) and annualized contract
value (for recurring amounts).
(2)
Generally calculated as the total contract price (for system sales)
and annualized contract value (for support) for perpetual license
system sales and total contract price for SaaS sales. TruBridge,
Inc. Bookings Composition (In '000s) (Unaudited) Three
Months Ended March 31,
2024
2023
RCM Net new(1)
$
8,993
$
6,029
Cross-sell(1)
5,398
6,071
EHR Non-subscription sales(2)
3,078
4,064
Subscription revenue(3)
5,532
3,207
Patient engagement
568
476
Total
$
23,569
$
19,847
(1)
“Net new” represents bookings from outside the Company’s core EHR
client base, and “Cross-sell” represents bookings from existing EHR
customers. In each case, such bookings are generally comprised of
recurring revenues to be recognized ratably over a one-year period
and an average timeframe for commencement of bookings-to-revenue
conversion of four to six months following contract execution.
(2)
Represents nonrecurring revenues that generally exhibit a timeframe
for bookings-to-revenue conversion of five to six months following
contract execution.
(3)
Represents recurring revenues to be recognized on a monthly basis
over a weighted-average contract period of five years, with a start
date in the next 12 months and an average timeframe for
commencement of bookings-to-revenue conversion of five to six
months following contract execution. TruBridge, Inc. Adjusted
EBITDA - by Segment (In '000s) (unaudited) Three Months
Ended March 31, In '000s
2024
2023
RCM
$
6,396
$
7,898
EHR
2,929
6,157
Patient engagement
129
588
Total
$
9,454
$
14,643
TruBridge, Inc. Reconciliation of Non-GAAP Financial Measures (In
'000s) (Unaudited) Three Months Ended March 31,
Adjusted
EBITDA:
2024
2023
Net income (loss), as reported
$
(2,516
)
$
3,084
Net Income Margin
(3.0
%)
3.6
%
Depreciation expense
400
498
Amortization of software development costs
2,742
1,486
Amortization of acquisition-related intangibles
3,126
4,014
Stock-based compensation
800
1,247
Severance and other nonrecurring charges
3,844
1,104
Interest expense
4,072
2,669
Gain on sale of AHT
(1,250
)
-
Other
(172
)
(268
)
Provision (benefit) for income taxes
(1,592
)
809
Total Adjusted EBITDA
$
9,454
$
14,643
Adjusted EBITDA Margin
11.4
%
17.0
%
TruBridge, Inc. Reconciliation of Non-GAAP Financial
Measures (In '000s, except per share data) (Unaudited) Three
Months Ended March 31,
Non-GAAP Net Income and Non-GAAP EPS:
2024
2023
Net income (loss), as reported
$
(2,516
)
$
3,084
Pre-tax adjustments for Non-GAAP EPS: Amortization of
acquisition-related intangible assets
3,127
4,014
Stock-based compensation
800
1,247
Severance and other nonrecurring charges
3,844
1,104
Non-cash interest expense
90
90
Gain on sale of AHT
(1,250
)
-
After-tax adjustments for Non-GAAP EPS: Tax-effect of pre-tax
adjustments, at 21%
(1,388
)
(1,357
)
Tax shortfall (windfall) from stock-based compensation
-
50
Non-GAAP net income
$
2,707
$
8,232
Weighted average shares outstanding, diluted
14,234
14,136
Non-GAAP EPS
$
0.19
$
0.58
TruBridge, Inc. Electronic Health Record (EHR) Revenue
Composition (In '000s) (Unaudited) Three Months Ended March
31,
2024
2023
Recurring revenues - EHR Acute Care EHR
$
25,910
$
27,613
Post-acute Care EHR
582
3,906
Total recurring revenues - EHR
26,492
31,519
Non-recurring revenues - EHR Acute Care EHR
1,449
3,292
Post-acute Care EHR
81
380
Total non-recurring revenues - EHR
1,530
3,672
Total EHR revenues
$
28,022
$
35,191
Explanation of Non-GAAP Financial Measures
We report our financial results in accordance with accounting
principles generally accepted in the United States of America, or
“GAAP.” However, management believes that, in order to properly
understand our short-term and long-term financial and operational
trends, investors may wish to consider the impact of certain
non-cash or non-recurring items, when used as a supplement to
financial performance measures that are prepared in accordance with
GAAP. These items result from facts and circumstances that vary in
frequency and impact on continuing operations. Management uses
these non-GAAP financial measures in order to evaluate the
operating performance of the Company and compare it against past
periods, make operating decisions, and serve as a basis for
strategic planning. These non-GAAP financial measures provide
management with additional means to understand and evaluate the
operating results and trends in our ongoing business by eliminating
certain non-cash expenses and other items that management believes
might otherwise make comparisons of our ongoing business with prior
periods more difficult, obscure trends in ongoing operations, or
reduce management’s ability to make useful forecasts. In addition,
management understands that some investors and financial analysts
find these non-GAAP financial measures helpful in analyzing our
financial and operational performance and comparing this
performance to our peers and competitors.
As such, to supplement the GAAP information provided, we present
in this press release and during the live webcast discussing our
financial results the following non‑GAAP financial measures:
Adjusted EBITDA, Adjusted EBITDA Margin, Non-GAAP net income, and
Non-GAAP earnings per share (“EPS”).
We calculate each of these non-GAAP financial measures as
follows:
- Adjusted EBITDA – Adjusted EBITDA
consists of GAAP net income as reported and adjusts for (i)
depreciation expense; (ii) amortization of software development
costs; (iii) amortization of acquisition-related intangibles; (iv)
stock-based compensation; (v) severance and other non‑recurring
charges; (vi) interest expense; (vii) gain on sale of AHT; (xiii)
Other; and (ix) the provision (benefit) for income taxes.
- Adjusted EBITDA Margin – Adjusted
EBITDA Margin is calculated as Adjusted EBITDA, as defined above,
divided by total revenue.
- Non-GAAP net income – Non-GAAP net
income consists of GAAP net income as reported and adjusts for (i)
amortization of acquisition-related intangible assets; (ii)
stock-based compensation; (iii) severance and other non-recurring
charges; (iv) non-cash interest expense; (v) gain on sale of AHT;
and (vi) the total tax effect of items (i) through (v).
- Non-GAAP EPS – Non-GAAP EPS
consists of Non-GAAP net income, as defined above, divided by
weighted average shares outstanding (diluted) in the applicable
period.
Certain of the items excluded or adjusted to arrive at these
non-GAAP financial measures are described below:
- Amortization of acquisition-related
intangibles – Acquisition-related amortization expense is a
non-cash expense arising primarily from the acquisition of
intangible assets in connection with acquisitions or investments.
We exclude acquisition-related amortization expense from non-GAAP
financial measures because we believe (i) the amount of such
expenses in any specific period may not directly correlate to the
underlying performance of our business operations and (ii) such
expenses can vary significantly between periods as a result of new
acquisitions and full amortization of previously acquired
intangible assets. Investors should note that the use of these
intangible assets contributed to revenue in the periods presented
and will contribute to future revenue generation, and the related
amortization expense will recur in future periods.
- Stock-based compensation –
Stock-based compensation expense is a non-cash expense arising from
the grant of stock-based awards. We exclude stock-based
compensation expense from non-GAAP financial measures because we
believe (i) the amount of such expenses in any specific period may
not directly correlate to the underlying performance of our
business operations and (ii) such expenses can vary significantly
between periods as a result of the timing and valuation of grants
of new stock-based awards, including grants in connection with
acquisitions. Investors should note that stock-based compensation
is a key incentive offered to employees whose efforts contributed
to the operating results in the periods presented and are expected
to contribute to operating results in future periods, and such
expense will recur in future periods.
- Severance and other nonrecurring
charges – Non-recurring charges relate to certain severance
and other charges incurred in connection with activities that are
considered non-recurring. We exclude non-recurring expenses
(primarily related to costs associated with our recent business
transformation initiative and transaction-related costs) from
non-GAAP financial measures because we believe (i) the amount of
such expenses in any specific period may not directly correlate to
the underlying performance of our business operations and (ii) such
expenses can vary significantly between periods.
- Non-cash interest expense –
Non-cash interest expense includes amortization of deferred debt
issuance costs. We exclude non-cash interest expense from non-GAAP
financial measures because we believe these non-cash amounts relate
to specific transactions and, as such, may not directly correlate
to the underlying performance of our business operations.
- Interest expense: Interest
incurred on our term loan and revolving credit facility.
- Gain on sale of AHT: Represents
the excess of proceeds received over the net assets sold from our
sale of AHT, our previously wholly-owned post-acute business, in
January 2024.
- Tax shortfall (windfall) from stock-based
compensation – ASU 2016-09, Improvements to Employee
Share-Based Payment Accounting, became effective for the Company
during the third quarter of 2017 and changes the treatment of tax
shortfall and excess tax benefits arising from stock based
compensation arrangements. Prior to ASU 2016-09, these amounts were
recorded as an increase (for excess benefits) or decrease (for
shortfalls) to additional paid-in capital. With the adoption of ASU
2016-09, these amounts are now captured in the period’s income tax
expense. We exclude this component of income tax expense from
non-GAAP financial measures because we believe (i) the amount of
such expenses or benefits in any specific period may not directly
correlate to the underlying performance of our business operations;
and (ii) such expenses or benefits can vary significantly between
periods as a result of the valuation of grants of new stock-based
awards, the timing of vesting of awards, and periodic movements in
the fair value of our common stock.
Management considers these non-GAAP financial measures to be
important indicators of our operational strength and performance of
our business and a good measure of our historical operating trends,
in particular the extent to which ongoing operations impact our
overall financial performance. In addition, management may use
Adjusted EBITDA, Non-GAAP net income and/or Non-GAAP EPS to measure
the achievement of performance objectives under the Company’s stock
and cash incentive programs. Note, however, that these non-GAAP
financial measures are performance measures only, and they do not
provide any measure of cash flow or liquidity. Non-GAAP financial
measures are not alternatives for measures of financial performance
prepared in accordance with GAAP and may be different from
similarly titled non-GAAP measures presented by other companies,
limiting their usefulness as comparative measures. Non-GAAP
financial measures have limitations in that they do not reflect all
of the amounts associated with our results of operations as
determined in accordance with GAAP. Additionally, there is no
certainty that we will not incur expenses in the future that are
similar to those excluded in the calculations of the non-GAAP
financial measures presented in this press release. Investors and
potential investors are encouraged to review the “Unaudited
Reconciliation of Non‑GAAP Financial Measures” above.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240510938938/en/
Investor Relations Contact Asher Dewhurst, ICR Westwicke
TBRGIR@westwicke.com Media Contact Tracey Schroeder Chief
Marketing Officer Tracey.schroeder@trubridge.com (251) 639-8100
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