Reliq Health Technologies, Inc. Files FY 2022 Annual Audited Financial Statements, Announces 485% Year-over-Year Increase in Revenues
November 02 2022 - 7:29AM
Reliq Health Technologies Inc. (TSXV:RHT or
OTCQB:RQHTF) (“
Reliq” or the
“
Company”), a rapidly growing global healthcare
technology company that specializes in developing innovative
Virtual Care solutions for the multi-billion dollar Healthcare
market, today announced that the annual audited consolidated
financial statements (“Financial Statements”) and Management’s
Discussion and Analysis (“MD&A”) for the fiscal year ended June
30, 2022, are now available on the Company’s profile on SEDAR
(www.sedar.com).
“We have now filed our annual audited financials
for Fiscal Year 2022,” said Dr. Lisa Crossley, CEO of Reliq Health
Technologies, Inc. “FY 2022 was a period of tremendous growth for
the Company. Revenues for the fiscal year increased by 485% to
$8,551,807 for FY 2022 as compared to $1,462,165 for FY 2021.
Despite the significant resurgence of COVID-19 (Omicron variant) in
late 2021 / early 2022, revenue from software and services sales
increased by over 1,940% to $2,739,516 for FY 2022 compared to
$134,264 for FY 2021, consistent with the Company’s prior
statements that for 2023 and beyond the majority of the Company’s
revenue would be generated by software and services sales vs device
sales. We expect growth to accelerate through the end of calendar
year 2022 and through 2023. We remain on track to onboard over
100,000 patients to the platform by the end of December 2022 and
over 200,000 by mid-calendar year 2023.”
“Subsequent to June 30, 2022 the Company
received $341,805 in proceeds from the exercise of 1,139,350 share
purchase warrants @ $0.30. The remaining 3,738,332 outstanding
warrants @ $0.30 have expiry dates between November 13, 2022 and
December 3, 2022. Exercise of these warrants would generate up to
an additional $1,121,499.60 in proceeds for the Company.”
“To date as a Company we have been focused
primarily on cementing our first mover advantage and establishing
ourselves as the market leader by acquiring as many clients and
patients as possible in the shortest possible time period,”
continued Dr. Crossley. “Going forward we will be shifting
resources to the account management side to help accelerate
onboarding, reduce the time it takes for patients to go from
initial onboarding to fully adherent and billable, and accelerate
collections. The Company expects to be generating significant free
cash in 2023 and intends to initiate a share buyback program at
that time to offset any dilution incurred over the past several
years.”
The Company is also pleased to provide the
following corporate update.
-
Highlights from FY 2022 Annual Audited Financial
StatementsDuring the twelve month period ending June 30,
2022 and subsequent, the Company:
- Increased
sales 485% to $8,551,807 for FY 2022 relative to $1,462,165 for FY
2021.
- Increased
revenue from software and services by over 1,940% to $2,739,516 for
FY 2022 (FY 2021 - $134,264). Going forward the Company expects the
majority of its revenue in 2023 and beyond to come from higher
margin software and services vs device sales.
- Increased
gross profits over 515% to $5,301,304 for FY 2022 (FY 2021 -
$857,954). Gross Margin for the year was 62%. The gross margin was
affected by a temporary increase in device costs in Q3 and Q4 FY
2022 which has subsequently been resolved as the Company identified
new device suppliers. Gross margins are expected to reach the
target 75% in 2023 due to reduced device costs and an increase in
the percentage of the Company’s total revenues from higher margin
software and services vs device sales.
- On
January 1, 2022 CMS introduced five new billing codes for Remote
Therapeutic Monitoring (RTM), allowing clinicians to provide
ongoing in-home treatment and monitoring for patients with
musculoskeletal and respiratory conditions. RTM involves having
patients use medical devices that collect non-physiological data
such as therapy/medication adherence and therapy/medication
response, and also allows for patient self-reporting of key metrics
such as pain level, mobility, nighttime waking due to breathing
difficulties, etc. The new RTM codes have increased Reliq’s target
patient population by over 20 million newly eligible patients to
over 57 Million total eligible patients in the US alone.
- Signed an
agreement with Data Soft Logic (DSL) to provide iUGO Care to DSL’s
existing and new clients. Data Soft Logic currently has over 600
home health and hospice care agency clients who work with more than
1,000 primary care physicians to provide care to over 500,000
Medicare and Medicaid patients. Reliq started onboarding DSL’s
patients in Q2 Calendar Year 2022 and expects to ramp up to adding
over 50,000 new patients per year each year beginning in 2023, at
an estimated revenue of $60 per patient per month.
- Signed an
agreement with Cognizant to leverage Cognizant’s Care Management
resources for future deployments of Reliq’s iUGO Care software to
large scale clients. Cognizant provides services to 300+ health
systems and over 347,000 care providers who together provide care
to over 200 million lives globally. The agreement with Cognizant
will allow Reliq to scale to new levels and provide even the
largest healthcare organizations with confidence that the Company
can meet the needs of their patient populations, no matter the
size, allowing Reliq to access new opportunities to provide virtual
care to much larger patient populations both within the US and
globally.
- Signed a
contract with a large physician practice network in Florida to
onboard over 50,000 patients to its iUGO Care platform by the end
of 2023.
- Signed a
contract with a network of 40 Skilled Nursing Facilities (SNFs) in
Florida which is expected to add over 48,000 patients to its iUGO
Care platform every year beginning in 2023.
- Signed
contracts with 99 new US primary care physician practices and 28
other healthcare organizations in specialties including hospice
care, nephrology, orthopedics, long term care, skilled nursing,
hospital care, cardiology and care management.
- Signed
contracts with 25 new home health agencies in the US and 3 adult
medical day care facilities.
- Signed an
agreement with a US Contract Research Organization to use Reliq’s
iUGO Care software and Patient Engagement services to support their
oncology and other clinical trials.
- Notes on Accounts
Receivable and Revenue from Financing
- To date the
majority of the Company’s revenues have been generated through the
sale of devices. Subsequent to July 1, 2021 all device purchases
are associated with a subscription for software and services, and
therefore are a direct leading indicator of future software and
services revenue. Clients are offered 12- or 24-month payment plans
for hardware purchases. The Company charges a higher price for
devices that are paid for through payment plans and therefore
generates higher margin revenue for these devices. Because hardware
revenue is collected on a monthly basis over a 12- or 24-month
period per the purchase payment plan, the Company’s receivables
will continue to increase as device sales increase. This is as
expected and is not an indication that the receivables are at risk
of not being collected. As the Company’s software and services
revenue increases as a percentage of total sales, the outstanding
receivables as a percentage of total sales will decrease.
- Note that
revenue from hardware sales (corresponding to the total purchase
price of the devices) is recognized when the client takes
possession of the hardware. Hardware revenue is then received
monthly in accordance with the hardware purchase payment plan.
Software and services revenue is recognized on a monthly basis for
software and services delivered in the given month and is collected
monthly in accordance with the Company’s standard Net 60 day
payment terms.
- The audit
process for FY 2022 was substantively different from previous
years. Since the Company’s revenue had grown significantly and new
revenue lines and payment terms had been introduced, the process
was much more complex and time-consuming than either the Company or
its auditors had originally anticipated.
- During the
audit, various changes were made to the financial statements for FY
2022 to address the evolution of the business and to comply with
IFRS standards, including:
- A
Long-Term Receivables category was added to account for Sales of
devices and services with payment plans lasting more than 12
months.
- A
portion of revenue from any Sales involving payment plans lasting
more than 12 months was recognized as Financing Income. As a
result, ~$306,000 of Q4 Sales revenue was moved from Sales to
Financing Income, with ~$76,000 recognized in FY2022 and ~$230,000
deferred, to be recognized in FY 2023 and FY 2024. This had a small
negative impact on gross margin for Q4 FY 2022 but is not expected
to impact gross margin in future years.
-
Impact of COVID-19 on Operations in Q3 and Q4 FY
2022Revenue for the quarters ending March 31, 2022 and
June 30, 2022 was temporarily impacted by the COVID-19 surge caused
by the Omicron variant during the period from November 2021 through
February 2022. During this period, many of the patients on the iUGO
Care platform contracted COVID-19. Some of these patients became
sufficiently ill that they required hospitalization or were
temporarily prescribed in person home care visits. Under the terms
of the Medicare and Medicaid virtual care programs leveraged by the
Company’s clients, clinicians cannot bill for many of the
proactive, preventative services delivered using the iUGO Care
platform for any month in which a patient receives acute care in
the form of hospitalization or prescribed in person home care
visits. The Company was therefore not able to provide billable
services to those specific patients during the month in which they
received acute care due to COVID-19, and as a result was not able
to bill the associated client for affected patients during the
acute care period. In addition, many of the Company’s physician and
home health agency clients and their clinical staff contracted
COVID-19 during the Omicron wave, which in some cases resulted in
longer training and patient engagement times for new patients. For
these clients this increased the time from which their patients
were onboarded to the point at which the Company was able to bill
for its services to over 90 days. Despite the challenges associated
with the Omicron variant surge and its impact on growth in Q3 and
Q4 FY 2022, the Company’s software and services revenue for the
year increased over 1940% relative to FY 2021.While there is the
potential for COVID-19 surges in the future, these waves will only
have a short term impact on revenue. Overall the long term impact
of the COVID-19 pandemic on the Company’s business is strongly
positive, as it led to a significant increase in the scope and
reimbursement levels of the virtual care programs funded by the
Centers for Medicare & Medicaid Services, and drove a dramatic
increase in acceptance and adoption of virtual care solutions in
the Community Healthcare market. As a result, the market demand for
the Company’s products and services has increased exponentially
over the last twelve month.
-
Date for Webinar to Review Q1 FY 2023 Annual Audited
FinancialsThe Company’s quarterly financial statements for
Q1 FY 2023 (quarter ending September 30, 2022) are due to be filed
on or before November 29, 2022. The webinar to review the financial
statements will be scheduled on or before November 30, 2022.
About Reliq Health
Reliq Health Technologies is a rapidly growing
global healthcare technology company that specializes in developing
innovative Virtual Care solutions for the multi-billion dollar
Healthcare market. Reliq’s powerful iUGO Care platform supports
care coordination and community-based virtual healthcare. iUGO Care
allows complex patients to receive high quality care at home,
improving health outcomes, enhancing quality of life for patients
and families and reducing the cost of care delivery. iUGO Care
provides real-time access to remote patient monitoring data,
allowing for timely interventions by the care team to prevent
costly hospital readmissions and ER visits. Reliq Health
Technologies trades on the TSX Venture under the symbol RHT, on the
OTC as RQHTF and on the Frankfurt Stock Exchange under the WKN:
A2AJTB.
ON BEHALF OF THE BOARD
“Dr. Lisa Crossley”
CEO and Director
For further information please contact:
Company ContactInvestor Relations at
ir@reliqhealth.com
US Investor Relations ContactLytham Partners,
LLCBen ShamsianNew York |
Phoenix646-829-9701shamsian@lythampartners.com
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
Cautionary Statements Regarding Forward
Looking Information
Certain statements in this press release
constitute forward-looking statements, within the meaning of
applicable securities laws. All statements that are not historical
facts, including without limitation, statements regarding future
estimates, plans, programs, forecasts, projections, objectives,
assumptions, expectations or beliefs of future performance, are
"forward-looking statements".
We caution you that such "forward-looking
statements" involve known and unknown risks and uncertainties that
could cause actual and future events to differ materially from
those anticipated in such statements.
Forward-looking statements include, but are not
limited to, statements with respect to commercial operations,
including technology development, anticipated revenues, projected
size of market, and other information that is based on forecasts of
future results, estimates of amounts not yet determinable and
assumptions of management.
Reliq Health Technologies Inc. (the
"Company") does not intend and does not assume any
obligation, to update these forward-looking statements except as
required by law. These forward-looking statements involve risks and
uncertainties relating to, among other things, technology
development and marketing activities, the Company's historical
experience with technology development, uninsured risks. Actual
results may differ materially from those expressed or implied by
such forward-looking statements.
SOURCE: Reliq Health Technologies Inc.
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