MCI Onehealth Reports Second Quarter 2021 Financial Results
Quarterly revenue of $11.2 million up 53% over the same period last year, driven by the recovery of publicly insured health services and continued strong performance from corporate health customers
Demand from corporate customers continues to grow, with revenues from corporate customers up more than 80% to $1.87 million over the same quarter last year and nearly 500 corporate customers on board at the end of the second quarter
The company continues to focus on accretive acquisitions, investments in strategic partners and forming commercial partnerships to leverage advanced technology to improve healthcare services, including $12.6 million acquisition of Khure Health Inc.
Addition of seasoned Chief Innovation Officer to lead the company’s innovation, research and development unit lays the groundwork for expansion of the company’s inhouse technology initiatives and commercial partnerships
Adjusted EBITDA for the quarter was negative $691,000
TORONTO, Aug. 16, 2021 (GLOBE NEWSWIRE) -- MCI Onehealth Technologies Inc. (“MCI” or the “Company”) (TSX: DRDR), a clinician-led healthcare technology company focused on increasing access to and quality of healthcare, today released its financial results for the three months ended June 30, 2021. A summary of MCI’s financial and operational highlights for the quarter are set out below, and more detailed information is contained in the financial statements and related management discussion and analysis, which are available on MCI’s SEDAR page at www.sedar.com.
“We are continuing to ramp up our growth engine coming out of our IPO earlier this year, having completed a number of exciting investments and acquisitions in the second quarter of 2021,” said Dr. Alexander Dobranowski, CEO of MCI. “We continue to pursue strong accretive acquisitions and innovative partnerships that leverage cutting-edge technology to improve access, quality and cost of healthcare services, while building on organic growth through the expansion of MCI Connect and the launch of our MCI Onehealth innovation initiatives.”
Second Quarter 2021 Financial Highlights
Significant financial highlights for MCI during the second quarter of 2021 included:
Revenue Growth Quarter-over-Quarter: Revenue for the second quarter of 2021 increased 53% over the same period in 2020, driven by the ongoing recovery of publicly insured health services and robust growth from corporate health services driven by a broader array of services offered to corporate health customers. Total revenue for the three months ended June 30, 2021 was $11.2 million, compared to total revenue of $7.3 million in Q2 2020.
Growth from Corporate Customers: The performance of MCI’s corporate health services business continued to see significant growth, with nearly 500 corporate customers on board at the end of the second quarter. Second quarter revenues from corporate health services were $1.87, a 102% increase over the same quarter last year, and a 44% increase over the first quarter of 2021.
Liquidity: Cash and cash equivalents were $19.7 million at the end of the quarter, compared to $2.3 million in the same quarter last year, providing the capital required to meet short- and medium-term capital requirements while continuing to pursue new strategic acquisitions and to develop and implement the Company’s data-driven healthcare initiatives.
Adjusted EBITDA: Adjusted EBITDA for the quarter was negative $691,000, down $1.9 million as compared to the same period last year.
Net Losses: Net losses for the quarter were $2.8 million, a difference of negative $3.3 million from the same quarter in the previous year. Losses were driven primarily by physician fees (up $2.5 million over the same quarter last year), increased salary, wage and benefits expenses (up $2.0 million over the same quarter last year), corporate expenses (up $0.8 million over the same quarter last year) and expenses relating to share based compensation granted to key employees (up $1.4 million over the same quarter last year) as the company expands its team to match the pace of its aggressive growth strategy and continues to adjust to increased compliance and administrative costs following its IPO earlier this year.
Second Quarter 2021 Operational Highlights
Significant operational highlights for MCI during the second quarter of 2021 included:
Investment in Regen Scientific Inc. (“ReGen”) On April 12, 2021, MCI entered into a share exchange agreement with ReGen, a personalized, preventative, and regenerative health provider in Canada. Under the terms of the arrangement, MCI acquired approximately 9% of the issued and outstanding shares of ReGen in exchange for the issuance of 800,000 Class A Subordinate Voting Shares of MCI (“MCI Shares”).
Investment in Ariel Precision Medicine, Inc. (“Ariel”) On April 23, 2021, MCI invested US$250,000 in a convertible promissory note issued by Ariel, whose business focuses on precision diagnosis and targeted therapeutics. The transaction agreements provide MCI with the right (but not the obligation) to participate, on a pro-rata basis, in any issuances by Ariel of equity securities or any security convertible into equity securities occurring after a qualified financing.
Acquisition of Khure Health Inc. (“Khure”) On April 26, 2021, MCI acquired 100% of the outstanding common shares of Khure for aggregate consideration of up to $12.6 million. Khure’s technology platform harnesses clinical data, enabling physicians to rapidly screen and identify patients with rare diseases and facilitate more personalized treatment. The details of the acquisition are set out in MCI’s press release dated April 27, 2021.
Investment in Acorn Biolabs Inc. (“Acorn”) On June 7, 2021, MCI entered into a share exchange agreement to acquire common shares of Acorn in exchange for the issuance of 380,953 MCI Shares, with the result that the Company now owns a minority interest in Acorn. Acorn is a healthcare technology company with a focus on regenerative medicine, which offers a non-invasive live cell collection, analysis and cryopreservation service.
Chief Innovation Officer: The addition of Saleema Khimji, a champion of innovation with a proven track-record of advancing science and technology initiatives across the globe, as Chief Innovation Officer of the Company gives MCI the strong leadership and expertise required to drive its MCI Onehealth Labs business unit, which is tasked with building a long-term pipeline of intellectual property and contributions to clinical research.
Events Subsequent to Second Quarter 2021
Following the end of the second quarter, MCI has continued to implement its strategic plan with a number of significant new developments, including:
Investment in ORO Health Inc. (“ORO”): On July 12, 2021, MCI invested $250,000 to purchase an interest in ORO, an innovating telehealth service provider, through the acquisition of Series 1 Class Seed Preferred Shares of ORO.
Acquisition of the Polyclinic Group: On July 15, 2021, MCI entered into an agreement to purchase an 80% interest in the “Polyclinic Group of Companies” for total consideration of $5.8 million. The Polyclinic Group of Companies include The Quit Clinic Inc., Executive Medical Concierge Canada Ltd. and Canadian Phase Onward Inc. MCI subsequently closed the acquisition on July 30, 2021. The details of the acquisition are set out in MCI’s press releases dated July 15, 2021 and August 4, 2021
Outlook
MCI expects continued growth in total company revenue in the second half of fiscal 2021 as it executes its strategic plan on multiple fronts including:
Organic growth of government insured health services from its omnichannel network of clinics, telehealth and the MCI Connect virtual platform.
Continued organic growth in health services provided to corporate customers, as it expands its customer base and increases the number of available service offerings.
New technology business ventures and acquisitions to accelerate its technology roadmap.
Acquisitions of specialty clinics to expand its health service offerings and enter new markets by leveraging technology to deliver more services to its large and growing patient and physician base.
Exploration of commercial relationships that leverage expressed interest in Khure Health’s AI-drive clinical evidence around rare diseases to accelerate patient recruitment for clinical trials, accelerate patient access to treatment, support regulatory decision-making through the application of real world evidence and set the foundations for new AI technologies.
Conference Call Details
MCI will hold a conference call to discuss progress on its key strategic initiatives and financial results for the second quarter of 2021, on August 16, 2021 at 5:30 pm EDT. Participants are encouraged to access the call at least 10 minutes prior to start.
Date:Monday August 16, 2021Time:5:30 pm (EDT)Duration:60 minutes Dial-in Canada/US:(833) 540-1153 (Toll-free) (918) 922-6528 (International) Conference Call ID:4586008 Webcast link:https://edge.media-server.com/mmc/p/h35jabsz
Selected Unaudited Financial Information Can be Found Here