OptimizeRx Reports Q4 2020 Revenue Up 123% to Record $16.4 Million, Driving Net Income of $1.4 Million or $0.08 Per Share
- Revenue in the fourth quarter of 2020 increased 123% to a record
$16.4 million, with the full year of 2020 up 76% to a record $43.3 million.
- Gross profit in the fourth quarter of 2020 increased 92% to
- GAAP net income totaled
$1.4 millionor $0.08per diluted share in the fourth quarter.
- Non-GAAP net income in the fourth quarter totaled
$2.7 millionor $0.16per diluted share (see definition of this non-GAAP measure and reconciliation to GAAP, below).
- Cash and cash equivalents totaled
$10.5 millionat December 31, 2020. Subsequent to the end of the fourth quarter, the company raised approximately $71 millionin an equity offering.
- Finished the year with a pipeline of more than
$180 million, with more than $50 millionin enterprise deals.
- Enhanced the company’s point-of-care platform with launch of AI-powered real-world evidence solution, resulting in the accurate delivery of multiple messaging solutions to clinicians at critical points in a patient's care journey.
- Recognized by Deloitte as one of the top 500 fastest growing companies in
- Company’s virtual communications solutions, TelaRep™, was recognized as one of the most innovative solutions for life science companies by
- Completed the integration of previous acquisitions in patient engagement and enhanced the leadership and commercial team to accelerate growth.
- Expanded direct-to-patient reach by partnering with
Epion Health, a leader in digital patient engagement solutions, providing patients with direct access to savings programs sponsored by life science companies.
- Joined forces with
Komodo Health, a data-driven healthcare software company, to use automated intelligence to seamlessly deliver point-of-care messaging.
Q4 2020 Financial Summary
Total revenue in the fourth quarter of 2020 increased 123% to a record
Gross margin decreased to 52.4% from 60.6% in the year-ago quarter, with the decrease related to a change in solution mix.
Operating expenses totaled
Net income on a GAAP basis was
Non-GAAP net income was
Cash and cash equivalents totaled
Full Year 2020 Financial Summary
Total revenue in 2020 increased 76% to a record
Gross margin decreased to 55.7% in 2020 as compared to 62.8% in 2019. The decrease was due to a shift in solution mix, including an increase in the company’s core messaging revenues which have higher revenue share percentages. The company expects gross margins in the range of 56% to 58% in 2021.
Operating expenses totaled
Net loss on a GAAP basis was
Non-GAAP net income was
The company expects to file its Form 10-K in the second week of March.
“In Q4, we more than doubled our top line and generated positive net income largely as the result of strong organic growth,” said
“These results also reflect how we have made great strides with innovation during the pandemic, and particularly with the introduction of TelaRep™, our new virtual communication solution. This cloud-based platform enables providers to reach the right pharma contact from within their EHR workflow and with just one click. TelaRep helps eliminate the communication gap created by today’s limited opportunities for face-to-face interaction, a growing challenge even before the pandemic.
“In addition to existing solutions on the platform, we are now leveraging real-world data to deliver real-time information at the point-of-care with our new AI-powered real-world evidence solution. The sophisticated proprietary algorithms that power this solution also enable us to derive additional revenue from our existing systems.
“In 2021, we expect continued strong growth resulting from the solid foundation we’ve laid over the last two years. As we continue to invest in innovations and enhance the scalability of our technology and commercial teams, we believe we have the momentum, at least aspirationally, to reach a
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Definition and Use of Non-GAAP Financial Measures
This earnings release includes a presentation of non-GAAP net income (loss) and non-GAAP earnings (loss) per share or non-GAAP EPS, both of which are non-GAAP financial measures.
The company defines non-GAAP net income (loss) as GAAP net income (loss) with an adjustment to add back depreciation, amortization, stock-based compensation, acquisition expenses, income or loss related to the fair value of contingent consideration, and deferred income taxes. Non-GAAP EPS is defined as non-GAAP net income (loss) divided by the number of weighted average shares outstanding on a basic and diluted basis. The company has provided non-GAAP financial measures to aid investors in better understanding its performance. Management believes that these non-GAAP financial measures provide additional insight into the operations and cashflow of the company.
Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash operating expenses, management believes that providing non-GAAP financial measures that excludes non-cash expenses allows for meaningful comparisons between the company’s core business operating results and those of other companies, as well as provides an important tool for financial and operational decision making and for evaluating the company’s own core business operating results over different periods of time.
The company’s non-GAAP net income (loss) and non-GAAP EPS measures may not provide information that is directly comparable to that provided by other companies in the company’s industry, as other companies in the industry may calculate such non-GAAP financial results differently. The company’s non-GAAP net income (loss) and non-GAAP EPS are not measurements of financial performance under GAAP and should not be considered as an alternative to operating income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. The company does not consider these non-GAAP measures to be substitutes for or superior to the information provided by its GAAP financial results.
The table, “Reconciliation of non-GAAP to GAAP Financial Measures,” included below, provides a reconciliation of non-GAAP net income (loss) and non-GAAP EPS for the three months and twelve months ended
OptimizeRx is a digital health company that provides communications solutions for life science companies, physicians and patients. Connecting over half of healthcare providers in the U.S. and millions of patients through a proprietary network, the OptimizeRx digital health platform helps patients afford and stay on medications. The platform unlocks new patient and physician touchpoints for life science companies along the patient journey, from point-of-care, to retail pharmacy, through mobile patient engagement.
Important Cautions Regarding Forward-Looking Statements
This press release contains forward-looking statements within the definition of Section 27A of the Securities Act of 1933, as amended, and such as in section 21E of the Securities Act of 1934, as amended. These forward-looking statements should not be used to make an investment decision. The words 'estimate,' 'possible' and 'seeking' and similar expressions identify forward-looking statements, which speak only as to the date the statement was made. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted, or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to, the effect of government regulation, competition, and other material risks.
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CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
|Cash and cash equivalents||$||10,516,776||$||18,852,680|
|Accounts receivable, net||17,885,705||7,418,025|
|Total Current Assets||32,859,092||27,141,748|
|Property and equipment, net||148,854||176,014|
|Technology assets, net||5,251,822||6,238,453|
|Patent rights, net||2,349,570||2,550,587|
|Right of use assets, net||445,974||559,863|
|Other intangible assets, net||4,519,552||5,151,102|
|Security deposits and other assets||12,859||80,727|
|Total Other Assets||27,319,808||29,320,763|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Accounts payable – trade||$||618,250||$||492,995|
|Revenue share payable||4,969,868||1,618,438|
|Current portion of lease liabilities||123,220||115,431|
|Contingent purchase price payable||1,610,813||1,500,000|
|Total Current Liabilities||10,028,307||6,107,513|
|Lease liabilities, net of current portion||325,533||448,753|
|Contingent purchase price payable, net of current portion||-||5,220,000|
|Total Non-Current Liabilities||325,533||5,668,753|
|Commitments and contingencies||-||-|
|Total Stockholders’ Equity||49,973,914||44,862,259|
|TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY||$||60,327,754||$||56,638,525|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|Cost of revenues||7,822,280||2,906,933||19,207,902||9,158,699|
|Depreciation and amortization||512,005||536,859||2,075,888||1,282,787|
|Other general and administrative expenses||5,954,327||5,763,874||20,992,012||15,590,054|
|Total operating expenses||7,247,553||6,791,311||26,240,740||19,133,139|
|Income (loss) from operations||1,356,468||(2,318,462||)||(2,135,319||)||(3,693,564||)|
|Other income (expense)|
|Change in fair value of contingent consideration||(660,000||)||(140,390||)||(635,000||)|
|Total other income (expense)||698||(564,278||)||(71,808||)||(346,972||)|
|Income (loss) before provision for income taxes||1,357,166||(2,882,740||)||(2,207,127||)||(4,040,536||)|
|Income tax benefit||-||897,960||-||897,960|
|Net income (loss)||$||1,357,166||$||(1,987,780||)||$||(2,207,127||)||$||(3,142,576||)|
|Weighted average number of shares outstanding - basic||15,127,425||14,548,910||14,827,923||13,387,863|
|Weighted average number of shares outstanding - diluted||16,311,904||14,548,910||14,827,923||13,387,863|
|Net income (loss) per share – basic||$||0.09||$||(0.14||)||$||(0.15||)||$||(0.23||)|
|Net income (loss) per share – diluted||$||0.08||$||(0.14||)||$||(0.15||)||$||(0.23||)|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|CASH FLOWS FROM OPERATING ACTIVITIES:|
|Adjustments to reconcile net loss to net cash used in operating activities:|
|Depreciation and amortization||1,971,083||1,175,131|
|Noncash lease expense||104,805||107,656|
|Increase in bad debt reserve||200,000||80,000|
|Income tax benefit||(897,960||)|
|Change in fair value of contingent consideration||140,390||635,000|
|Prepaid expenses and other assets||(3,517,700||)||(343,838||)|
|Revenue share payable||3,351,430||(290,178||)|
|Accrued expenses and other||1,416,884||(432,075||)|
|Change in operating lease liabilities||(106,347||)||(106,564||)|
|CASH FLOWS FROM INVESTING ACTIVITIES:|
|Purchases of property and equipment||(68,041||)||(87,717||)|
|Acquisition of intangible assets, including intellectual property rights||(11,932||)||(1,500,000||)|
|Capitalized software development costs||(44,752||)||-|
|Cash paid in acquisition, net of cash acquired||-||(8,994,369||)|
|CASH FLOWS FROM FINANCING ACTIVITIES:|
|Proceeds from issuance of common stock, net of offering costs||-||21,303,826|
|Proceeds from exercise of stock options||2,488,394||877,702|
|Payment of contingent consideration||(4,389,187||)||-|
|NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES||(1,900,793||)||22,181,528|
|NET INCREASE (DECREASE IN) CASH AND CASH EQUIVALENTS||(8,335,904||)||9,938,646|
|CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD||18,852,680||8,914,034|
|CASH AND CASH EQUIVALENTS – END OF PERIOD||$||10,516,776||$||18,852,680|
|SUPPLEMENTAL CASH FLOW INFORMATION:|
|Cash paid for interest||$||-||$||-|
|Cash paid for income taxes||$||-||$||-|
|NON-CASH INVESTING AND FINANCING ACTIVITIES:|
|Lease liabilities arising from right of use assets||-||207,559|
|Acquisition liabilities paid in stock||$||1,6,557,548||$|
|Shares issued in connection with acquisitions||$||$||5,107,793|
|Non-cash effect of cumulative adjustments to accumulated deficit||$||$||3,229|
Reconciliation of non-GAAP to GAAP Financial Measures
|For the Three Months||For the Year|
|Ended December 31,||Ended
|Net income (loss)||$(1,984,780||)||$(2,207,127||)||$(3,142,576||)|
|Depreciation and amortization||512,005||536,859||2,075,888||1,282,787|
|Income or loss related to the fair value of contingent consideration||-||660,420||140,390||635,000|
|Deferred Income Taxes||-||(897,960||)||-||(897,960||)|
|Non-GAAP net income (loss)||$(395,260||)|
|Non-GAAP net income (loss) per share|
|Weighted average shares outstanding:|
Source: OptimizeRx Corporation