WELL Health Technologies Corp T.WELL

Alternate Symbol(s): WHTCF | T.WELL.DB

Healthcare

WELL Health Technologies Corp. is a practitioner-focused digital healthcare company. The Company develops technologies, services, and support available, which ensures healthcare providers are empowered to positively impact patient outcomes. Its business units include Canadian Patient Services, WELL Health USA Patient Services and SaaS and Technology Services. WELL Health USA Patient and Provider Services includes Primary Circle Medical, Primary WISP, Specialized CRH Medical, and Specialized Provider Staffing. Its healthcare and digital platform includes front and back-office management software applications that help physicians run and secure their practices. Its focused markets include the gastrointestinal market, women's health, primary care and mental health. Its solutions enable 34,000 healthcare providers between the United States and Canada and power owned and operated healthcare’s in Canada with 165 clinics supporting primary care, specialized care and diagnostic services.

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Comment by Blib1990on Jan 17, 2022 4:21pm

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Post# 34326001

RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Here it goes

monty613 wrote:
bandit69 wrote:
how is that? I mentioned they were not prifitable and that's derived from the revenue statement..... you are the one that keeps saying they are cash flow positive which, is focused on the cash flow statement. If you go back I clearly said all statements are linked (revenue, balance sheet, cash flow) and what happens on one affects the other two.

And I can't believe anyone who falls for the mantra that depreciation and amortization are not real or are "fictional" costs to a business. Stunning.

I don't need an accounting lesson. you just don't seem to understand how EBITDA shows a clearer picture of this company's true profitability and cashflow generating abilities when excluding i) non-cash expenses and ii) one-time items that won't be recurring. what is the alternative? wait 1 year to see the income statement without these one-time items? it is a meaningful metric in WELL's situation. I understand it can be played with and I understand it can be abused, however, WELL's add-backs look reasonable here.

depreciation and amortization are not meaningful expenses for WELL. WELL has a large depreciation and amortization expense because of how their CRH assets are structured. they are JV contracts with minority interest partners. to understand this, you have to understand the business.

CRH partners with GI doctors providing the anesthesia services to them for colonoscopy procedures.

these doctors typically own the clinics, own the colonscopy practice, and also own the anesthesia business. they own all the fixed assets.

the GI doctor sells a 51%+ stake in the anesthesia business only to CRH. this business is simply the vendor of the anesthesia to the GI doctor.

the doctors remain on as 49% owner in the anesthesia business. the doctors continue to perform the colonscopy procedures and they use their newly formed entity with CRH to provide the anesthesia.

so why do they sell? the doctor reaps a up-front windfall of cash and also benefits from CRH providing all the back office and billing functions for them. CRH also provides them with cheaper anesthesia supplies given their economies of scale.

the doctors are incented to continue to run the business profitably as they are a 49% owner and still participate in the profitability of the anesthesia.

CRH's contracts with the doctor are time-limited and thus this contract asset is amortized.

at the end of the contract, it is almost guaranteed to be renewed. why? because the doctor owns 49% of the anesthesia business. if they cancelled the anesthesia contract, they would be cancelling on themselves as a vendor.

so what is the end result here? CRH acquired a time-limited cashflow which is amortized over the life of the contract. this creates a non-cash expense as the asset is marked down every year.

at maturity of the contract, it is renewed because their 49% partner is the one in control of the vendor relationship. they aren't cancelling on themselves.

I've put this explanation together quite quickly, but it is my view that this expense is truly non-cash. I'm sure Warren Buffet would agree.