HAMILTON, Ontario, March 01, 2023 (GLOBE NEWSWIRE) -- 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 condensed interim consolidated financial statements (“Financial Statements”) and Management’s Discussion and Analysis (“MD&A”) for the quarter ended December 31, 2022 (Q2 FY 2023), are now available on the Company’s profile on SEDAR (www.sedar.com).
“We have now filed our financials for the second quarter of Fiscal Year 2023,” said Dr. Lisa Crossley, CEO of Reliq Health Technologies, Inc. “The Company achieved record revenues of $4,118,524 for the three months ending December 31, 2022, and $12,683,030 for the twelve months ending December 31, 2022. Software and services revenue continues to increase as percentage of total revenue, increasing over 229% to $1,727,817 relative to the three months ended December 31, 2021 ($524,547). This is consistent with the Company’s previous guidance that high margin software and services will account for the majority of its revenue in 2023 and beyond. As discussed on our last webinar in January, 2023, the Company has prioritized increasing the pace of Collections and reducing the Time to Adherence for patients. Over the last two months the Company has made significant progress on both initiatives and expects to be current on Accounts Receivable and to have taken over management of adherence for all new and existing clients by the end of the fiscal year (June 30, 2023).”
The Company is also pleased to provide the following corporate update.
1. Highlights from Q2 FY 2023 Interim Financial Statements
During the three-month period ending December 31, 2022 and subsequent, the Company:
- Increased sales for the three months ended December 31, 2022 by over 90% to $4,118,524 relative to the three months ended December 31, 2021 ($2,140,124).
- Increased revenue from software and services by over 3X to $1,727,817 relative to the three months ended December 31, 2021 ($524,547). Going forward the Company expects the majority of its revenue to come from software and services vs hardware sales.
- Increased gross profits for the three months ended September 30, 2022 by 121% to $2,561,929 (December 31, 2021 - $1,159,024). Gross margins for the period were 62% due to a temporary increase in device costs which has subsequently been resolved as the Company added new device suppliers. Gross margins are expected to reach 75% in calendar year 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 hardware.
- Loss for the period decreased by 97% to $71,254 (loss) for the three months ending December 31, 2022, as compared to $2,155,111 (loss) for the three months ending December 31, 2021.
- After adjusting for non-cash expenses including share-based compensation, depreciation and accretion, and one-time non-reoccurring expenses including development costs associated with implementing the FHIR standard, the Company’s adjusted EBITDA (gain) for Q2 FY 2023 was $723,339, a 1,405% increase relative to the comparative period (Q2 FY 2022 adjusted EBITDA (gain) - $48,062).
- The Company expanded into the Skilled Nursing Facility (SNF) market, significantly increasing its total addressable market. There are over 15,000 SNFs in the United States and over 1.5 million Medicare patients received care in a SNF setting in 2021 (www.cms.gov).
- Signed a contract with a network of Skilled Nursing Facilities in Florida to deploy its iUGO Care platform in 189 facilities. The contract is expected to add over 206,000 patients to the platform every year beginning in 2023.
- Signed a contract with a network of Skilled Nursing Facilities in California to deploy its iUGO Care platform in 15 facilities. The contract is expected to add over 12,000 patients to the platform every year beginning in 2023.
2. Notes on Time to Adherence
- In calendar year 2022, the Company allowed clients to manage patient adherence on their own, based on clients’ assertions that they had the necessary resources and expertise to take on this responsibility. This resulted in delays in billing, as Reliq can’t deliver billable services to clients unless their patients are adherent (collecting vitals at least 16 days out of each month).
- The Company has conclusively demonstrated that adherence is achieved much sooner if Reliq manages the process instead of clients. As a result, the Company has made the following changes to its business model:
- As of January 1, 2023, all new contracts specify that clients must authorize Reliq to contact patients in order to ensure adherence. Account Managers are working with existing clients to obtain similar authorizations.
- The iUGO Care platform has been updated to provide timely alerts to Care Managers if a patient is at risk of non-adherence for a given month.
- Reliq is leveraging its Interactive Voice Recognition (IVR) technology to provide daily reminders to patients who are non-adherent.
- Reliq Care Managers will call patients who need additional adherence support.
3. Notes on Accounts Receivable
- In calendar years 2021 and 2022, the Company was very accommodating to clients and provided flexible payment terms in response to challenges they faced (COVID, overall market conditions, etc.), in order to demonstrate good faith and earn a reputation as a trusted partner in the healthcare market. This resulted in longer collection times but was critical to ensuring the long-term success of the Company.
- As of January 1, 2023, all Reliq Account Managers have been instructed to make collections their top priority. The Company expects to be current on its Accounts Receivable by the end of FY 2023 (June 30, 2023).
- 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.
4. Dates for Upcoming Webinars
The Company’s quarterly financial statements for Q2 FY 2023 (quarter ending March 31, 2023) are due to be filed on or before May 30, 2023. The webinar to review the financial statements will be scheduled on or before May 31, 2023. The Company will also hold an additional webinar on April 12, 2023 to provide an interim update on progress in key areas.
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 Contact
Investor Relations at ir@reliqhealth.com
US Investor Relations Contact
Lytham Partners, LLC
Ben Shamsian
New York | Phoenix
646-829-9701
shamsian@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.
