CloudMD Software and Services Inc. (DOCRF)

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Earnings Call Transcript - CloudMD Software & Services Inc. (DOCRF) CEO Essam Hamza on Q1 2021 Results.

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https://seekingalpha.com/article/4431852-cloudmd-software-services-inc-docrf-ceo-essam-hamza-on-q1-2021-results-earnings-call

May 28, 2021 12:02 AM ET

Company Participants
Julia Becker - Vice President of Investor Relations
Essam Hamza - Chief Executive Officer
Karen Adams - Chief Health Innovation Officer, Global Head of Enterprise Health Solutions
Daniel Lee - Chief Financial Officer

Conference Call Participants
Doug Taylor - Canaccord Genuity
Rob Goff - Echelon
Gabriel Leung - Beacon Securities
Nick Agostino - Laurentian Bank Securities

Operator
Good afternoon and welcome to CloudMD's Q1 earnings conference call and webinar. My name is Jewel and I will be a conference facilitator today. As a reminder, this conference call is being recorded. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period.Thank you. It is now my pleasure to turn the call over to Julia Becker, VP, Investor Relations for opening remarks.

Julia Becker
Perfect. Thank you Jewel and good afternoon everyone. Thank you so much for joining us today, May 27, 2021 for our first quarter 2021 earnings conference call and webinar. We will start the call with a summary from our Chief Executive Officer, Dr. Essam Hamza, followed by our Chief Health Innovation Officer and Global Head, Enterprise Health Solutions. Karen Adams, who will provide further commentary on our enterprise health solutions division or as we often refer to as our EHS division. Our Chief Financial Officer, Dan Lee will then recap the company's first quarter 2021 financial results before opening up for a question-and-answer period from the analysts.

A friendly reminder to everyone that today's discussion contains forward-looking information which involve inherent risks and uncertainties and other factors that could cause actual results to differ materially from management's current expectation. Forward-looking statements should not be read as assurances of future performance or results. The risks related to the forward-looking information are described in the company's Annual Information Form for the period ended December 31, 2020, which is available on SEDAR under the company's profile and in the company's Management Discussion and Analysis for the year ended December 31, 2020 and the quarter ended March 31, 2021, both of which are also available on our profile on SEDAR.

We encourage listeners to review our disclosure in the context of the forward-looking information we make here today during this earnings call. Investors are also cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this call. The company disclaims any intention or obligation, except to the extent required by law, to update and revise any forward-looking statements as a result of new information, future events or for any other reason.
With that done, it is my pleasure to turn the call over to Dr. Essam Hamza, CEO of CloudMD. Essam, the floor is yours.

Essam Hamza
Thank you Julia and good afternoon and thank you for joining us for our first quarter earnings call and webinar. I am very excited to share the details of our record Q1 2021 operational and financial results. CloudMD has made solid strategic and financial progress in the first three months of 2021, following a transformational year in 2020 where we built a foundation that positions us to be leaders in the delivery of healthcare.

In the middle of a global pandemic, we were not only able to keep our operations running but also built consistent growth across our entire business. Through this transition, our mission and vision have never changed. CloudMD is a healthtech company revolutionizing the delivery of healthcare through a patient-focused, whole-person approach to care. By leveraging technology, we are building a complete and connected healthcare ecosystem that addresses all points of a patient's care including primary care, virtual care, mental health support, access to specialist, health navigation and education. This proprietary platform underpins our organic growth strategy which we continue to see across all lines of our business.

The company was built on three foundational pillars that continue to serve us well.
- First, patient-centric longitudinal healthcare is the future and results in better access to care and improved outcomes.
- Secondly, we are led by a team of medical professionals, doctors and industry experts that understand the pain points of the fractured medical system and share their vision of team-based whole-person care.
- And finally, in order to execute on this vision and build a connected ecosystem, we must own our own technology solutions. Technology is the great equalizer that allows us to provide better access to healthcare and connect to siloed aspects through healthcare navigation.

We are delighted with our Q1 2021 operating and financial performance. We reported record revenue of $8.8 million, 187% increase from Q1 2020 and 51% increase from Q4 2020, largely attributable to strategic M&A and organic growth. In the quarter, we closed five acquisitions, adding $13 million in annual revenue and we established our transformational enterprise health solutions division, which Karen will speak to you shortly. In addition, the operating businesses are collaborating to leverage our assets creating the whole-person healthcare ecosystem. All of our acquisitions are high-growth, accretive and synergistic with cross-selling opportunities to drive further organic growth.

In February, we closed an oversubscribed $58 million bought deal financing, which provides us with strategic capital to deploy on mergers and acquisitions. We are well-funded with almost $100 million in the bank. In addition to being well-funded, we have access to debt financing and are looking at options to fund our future M&A activities while conserving cash and equity.

We view our businesses into three categories and it's important to note these categories are not siloed and they capitalize on each other's capabilities and are synergistic with each other.
We categorize our businesses into
- clinic services and pharmacies,
- digital services
and finally
- enterprise health solutions. We are proud to announce that we achieved growth across all divisions in the first quarter and expect to see continued growth throughout 2021.

Our clinics and pharmacies network consists of 14 hybrid clinics, two pharmacies and approximately 100 practitioners servicing over 500,000 patients. Our hybrid clinics include both in-person and telemedicine visits which capture the full revenue potential from a patient. Over the last year, we have seen a significant increase in telemedicine adoption by our clinic network and we have experienced a 20% increase in patient visits in every quarter since the launch of our CloudMD app in February 2020. Our telemedicine service complements our other businesses including the enterprise health solutions division and we are focused on providing longitudinal whole-person care by integrating this service with our other offerings.

Our healthtech solutions collectively make up our digital services category. In Q1, we announced the acquisition of addition of our VisionPros, adding over $35 million in annual revenue. At the end of the quarter, we closed the acquisition of IDYA4, the technology platform used to connect our ecosystem. Since we announced the acquisition in December 2020, IDYA4 has recognized over $1.5 million in contract wins and we expect significant organic growth throughout the year.

The enterprise health solutions division was launched in Q4 2020 and along with Re:Function and assessments in rehabilitation clinic network, it will represent approximately 44% of the company's $120 million annualized revenue run rate. We launched this division with a focus on client needs of cost optimization, targeted clinical solutions that were outcome-based supporting access to care for individuals with health and well-being concerns.
I will now pass it over Karen Adams to give an update on the enterprise health solutions division.

Karen Adams
Thank you Essam. This division was founded on targeted acquisition that had reoccurring revenue and all with strong client bases. Our differentiator is that we created a market-leading position through integrating our clinically, evidence-based capabilities and nurse-care navigator platform for the seamless delivery of mental and physical health to individuals. This access and quality of care creates a better user experience and optimized cost for employers while delivering health outcomes. We continue to make progress on executing our strategic plan while making delivered investment in enhancing our capability.

I am extremely proud of the team's effort in growing our core business capability within enterprise health solutions, EHS and the adoption of our integrated offerings launched in Q1. Our Q1 results fully reflect the effect of last year's acquisition of iMD, Re:Function and Snapclarity. Subsequently, in Q1 we completed the following acquisitions, HumanaCare, a national employee and family assistance program or commonly referred to as EFAP, a mental health solution provider based in Ontario. This acquisition expands our ability to service the employer mental health market need expanding breadth and depth of services to address mental health. HumanaCare has forged solid long-term client relationships and served through client and third-party brokers using innovative solutions.

And Medical Confidence, a national Canadian leader in healthcare navigation. Medical Confidence has built a strong reputation for innovative solutions in managing health issues of those on disability through outcome-driven care pathways and solid long-term relationships with clients. This acquisition enables us to leverage healthcare navigation as foundational to our ecosystem, providing a strong value proposition to ensure brokers and organization to optimize health outcome and cost. These company's financial results are only partially reflected in our Q1 results.

We have seen a strong adoption of our strategy to organic growth, which was slightly above 10%, resulting from a new distribution partnership and a strong sales pipeline. Including assessment and rehabilitation clinic network, EHS revenue was $3.1 million in Q1. This was driven by innovation, technology-enabled products and reoccurring revenue. In Q1, we launched a change management office to execute our integration initiative to better focus on user experience and manage priorities. This has resulted in increased revenue as well as gross margin and EBITDA expansion through several initiatives, including consolidation of our back-office platforms for iMD which is our educational resources, Snapclarity, our mental health online assessment tool and HumanaCare to strengthen the company's position as a leader in mental health support solution.

We initiated our first phase of integration with shared services for recently acquired companies. Additionally, we executed on cost synergies near the end of the quarter and will realize $500,000 in annual cost savings going forward. Second, expansion enhancement of our client acquisition and servicing team. And third, the introduction of a VP of Product Management to identify workflow solutions that improves the user experience.

I will now touch on some of the business highlight of Q1 as we focus on creating a leading health navigation service in the markets we serve. A key part of our growth strategy is our integrated health navigation platform. In Q1, we focused on implementation of our health navigation platform with a premier 11,000 life group. We have a strong pipeline for the integrated offering and have completed numerous proposals for clients interested in this specific platform to connect well-being for mental and physical health while optimizing their group benefits plan.

In addition, we are in contact with three insurers for our healthcare disability navigation, product that will be leveraging the platform as they reduce disability days and focus on return to work. These contracts will be implemented in the coming quarters.

In our mental health support, which includes EFAP, we added many new contracts to our platform and made our evidence-based mental health assessment tool through Snapclarity available to EFAP customers with an adoption rate of 45% in Q1. We continued to see momentum in new lives added to broker relationships who market our services to their client base. We have several proposals for distribution partnership. We launched the first mental health coaching program with assessment, triage and navigation, as well as a virtual trauma support program. Finally, in our assessment and rehabilitation capability, we earned new contracts with government agencies and have expand to new capabilities in psychological assessments for prevention and early intervention.

We also implemented a new approach to assessments for psychological impairment with a major insurer in providing assessment and treatment for claimants. We are focused on growth but we have identified further cost saving synergies as we continue to integrate capabilities across all of CloudMD, creating margin and EBITDA expansion while providing access to quality clinical care. Client satisfaction rates are trending above our internal targets, solidifying our confidence in continued growth of our strategy in the coming months. We launched our services in the United States and are recipients of a new distribution partnership with a national group benefits provider who will be implemented in the coming quarters.

Our four pillars of performance focus on,
- number one,
continued growth of solid reoccurring revenue in the core businesses.
- Number two,
actively manage integration of the entity that are critical to our product offering and EBITDA growth.
- Number three,
continued development of our technology utilizing the recently acquired health and wellness platform of IDYA4 to enable health navigation in connection of acquired company's associated capabilities. And
- number four,
U.S. expansion through leveraging our health and wellness platform and health capabilities.

Our clients have worked with us to create a market-leading solution that transforms the way health benefits are delivered to employees, resulting in reduced disability days, improved access to care and medical-based navigator through our able to respond and adjust treatment. We continue to focus on access and quality of care through the development of our ecosystem platform connecting both mental and physical health programs, providing one seamless delivery for mental, physical and specialist support.
I will now turn it over to Daniel Lee, our CFO, for the financial update.

Daniel Lee
Thank you Karen. As Essam and Karen touched on, it was a very good quarter for the business. We are very excited by our Q1 2021 results and the framework we have built for scale and growth. I will now walk through our fiscal 2021 first quarter results.

For the quarter, total revenue was $8.8 million, compared to $5.8 million in Q4 2020 and $3.1 million in Q1 2020. The increase is primarily attributable to acquisition growth with five acquisitions completed in the quarter and 11 acquisitions completed in the last 12 months. Excluding the impact of Q1 business acquisitions, the company achieved organic growth from its existing businesses. While the majority of the company's historical revenues were derived from clinic services and pharmacies, we expect enterprise health solutions and digital services to comprise of over 80% of total revenues starting in Q3 due to the company's recently completed and announced acquisitions.

For the quarter, gross margin was 41% in Q1 2021, compared to 40% in Q4 2020 and 37% in Q1 2020. The increase was primarily attributable to revenue mix where higher margin revenues from enterprise health solutions and digital services made up a stronger percentage of overall revenues. Given the completed and announced acquisitions, the company does expect its future gross margin to settle in the 35% range. While both Rxi and VisionPros are profitable, they do operate in high-volume, lower margin businesses which affect our overall gross margin.

For the quarter, adjusted EBITDA was a loss of $1.5 million in Q1 2021, compared to a loss of $1.5 million in Q4 2020 and a loss of $800,000 in Q1 2020. The company expects to improve its adjusted EBITDA performance in the coming quarters, which includes the profitable businesses we acquired in the last 12 months and the cost synergies we have started to realize near the end of Q1.

Turning now to the balance sheet. Cash and cash equivalents were $99 million at March 31, 2021, compared to $60 million at December 31, 2020. In Q1 2021, the company raised gross proceeds of $58 million in a bought deal financing in March 2021 and the company paid $13 million for five acquisitions, net of cash acquired in the quarter. Currently, the company has a cash and cash equivalent position of approximately $95 million and we anticipate the acquisitions of VisionPros and Oncidium to close some time in June 2021.

Lastly, given our Q1 2021 financial performance, we reiterate that CloudMD's annualized revenue run rate exceeds $120 million. We calculate our annualized revenue run rate based on a combination of, one, the last 12 month of revenues from our existing businesses and two, 2020 annualized revenue run rate for acquisitions completed since October 2020 and acquisitions announced but not yet closed, including VisionPros and Oncidium. CloudMD's annualized revenue run rate is intended to serve as a baseline for the business. This baseline does not include the organic growth that we are currently witnessing within the enterprise health solutions division or post-acquisition cross sell synergies we are seeing in our other businesses, discerned as an upside to our numbers. We are well-positioned for growth and this is why we are very excited about the future of CloudMD.
With that said, I would like to turn the call back to Essam for closing remarks of a very successful quarter.

Essam Hamza
Thank you Daniel. Everyone at CloudMD is proud of the work we are doing to transform the delivery of healthcare and the momentum we are seeing in the market. I would personally like to take a moment to thank our incredible team at CloudMD for their hard work and dedication to our vision. The company is well-funded to execute on its strategy with a strong financial position and access to capital. Our mission is to provide better access and improved healthcare outcomes to patients globally and we are very excited about the growth of CloudMD in the coming quarters and years. I thank our shareholders and analysts for their continued support.
And with that, I will ask the operator to open up for calls.

Question-and-Answer Session

Operator
And our first question comes from Doug Taylor with Canaccord Genuity. Your line is now open.

Doug Taylor
Yes. Thank you. Good evening. In the past, you provided a couple data points that helped us think about the organic growth post-acquisition of some of the elements mostly within the EHS segment. I know, Karen, you walked through a number of areas of success. But I wonder if you could provide us with or offer up any sort of quantitative numbers that help us think about the organic growth that you are seeing now to layer on top of that baseline $120 million revenue that you speak to?

Karen Adams
Dan, do you want me to take that?

Daniel Lee
Why don't I answer that first and Karen, feel free to add more comments to that. So Doug, so we did announce back in March about $5 million of new contract wins within enterprise. And so within Q1, we did realize about $250,000 of revenues coming from those contracts. And in Karen's prepared remarks, she did mention that we did experience a 10% organic growth within enterprise. And basically how the number is derived is taking our 2020 EHS revenue run rate. So when we had acquired those companies, we had a baseline and so the organic growth coming from these contract wins were adding about, call it about, $1.5 million of revenues to our 2021 numbers. So kind of just to answer your question, we have $120 million revenue run rate. And that increases by about $1.5 million specifically for 2021.

Doug Taylor
Okay. That's helpful in helping us think about that. You mentioned the cost synergies that you have achieved since, I believe, last time you talked to about $0.5 million. Can you just talk to what you have recognized out of that? And whether $0.5 million is still the number that you confirmed that that's the number that you are still seeing? Or have you uncovered anymore in addition to that?

Daniel Lee
Yes. So I will start, just in terms of talking about Q1, Doug. And Karen can certainly provide more color. So in terms of Q1, we did execute those synergies near the end of the quarter. And so there hasn't been a lot of savings baked into our Q1 numbers. But we will see $0.5 million annualized run rate in our model going forward, starting in Q2.

Karen Adams
Yes. The only other piece I would add is, we continue to look for the synergies through the change management office and identifying as new acquisitions come onboard. Shared services and integration of capability is a focus for us around the future identification of synergies going forward. So it's an active focus and now part of our onboarding of acquisitions.

Doug Taylor
Right. We will obviously look for once those remaining acquisitions close. I believe the guidance you provided here was for positive EBITDA now in the second half of the year. And I just want to understand, should I be reading anything into that versus the prior Q3? Is there a distinction there? Or am I just overthinking that?

Daniel Lee
Yes. So in terms of EBITDA, we are expected to be EBITDA positive. We are getting closer to EBITDA positive, Doug. But with Oncidium and VisionPros being completed sometime in the next month or so, we do expect for us to be EBITDA positive on the backend. In addition to the acquisitions, we will be realizing the cost synergies that we have already executed but also we are identifying more savings down the road. So that will certainly help us on the backend.
I don't know if that answers your question or not.

Doug Taylor
I just want to confirm that there is really no change in your timetable or expectation there? It was just a change in the language that I am reading too much into? Is that fair?

Daniel Lee
Yes. So there is no change in our --

Doug Taylor
Well, I just wanted to clarify. I have had questions about it already. Last question for me and I guess this one to both Essam and Karen. I think in the last time you reported and since you have signaled a period where you are looking to digest all these targeted acquisitions that you have executed the last year. Would you say that's still the stance right now while you are awaiting the close of the remaining couple of acquisitions? Or are you still open to additional activity here in the near term?

Essam Hamza
Maybe I will start there, Karen. We are always open and do have a strong pipeline still of potential acquisitions that follow kind of the mandates that we talked about earlier when I mentioned kind of that are profitable growth companies that are synergistic with what we do. The difference now that I would say, Doug, that honestly is that we built the foundation already and we are able to now go and find really good value that can tuck into that infrastructure we have already built. And so I think there is going to be even greater opportunity to find additional add-in to what we do already. We don't need to find the big puzzle pieces because we have already created those acquisitions already and put them together. So we are going to be adding other M&A opportunities over the next few quarters.

Doug Taylor
Okay. Thank you for clarifying. And I will pass the line.

Operator
Thank you. Our next question will come from Rob Goff with Echelon. Please go ahead.

Rob Goff
Good afternoon and thank you for taking my question. I am going to ask two questions, if I may. The first one would be on VisionPros. If you could perhaps give us an update on what you are seeing there in terms of momentum on the subscription front? Anything around its new vision test? The other question was on the EHS side where Karen mentioned launching into the U.S. and adding distribution capabilities. If you could perhaps elaborate on that, it would be appreciated?

Essam Hamza
Thanks Rob. With regards to VisionPros, we are working on closing it right now. And so over the next month here, as Dan referred to, we should have that closed and announced to the market. At that time, I think we will update the market on what we are seeing in our expectations with VisionPros. Until then, we are probably not going to give any guidance on what we are seeing before we close it, if that's okay, Rob.

Rob Goff
Good. Understand.

Essam Hamza
Yes. And I will have Karen maybe expand on our U.S. expansion here.

Karen Adams
Yes. So we have put somebody in place who is in charge of our growth strategy for the U.S. for our enterprise health division, specifically around the mental health. And they are actively, they have a sales person reporting to them and they are completing proposals and have been successful in securing a distribution partnership with a benefits broker in the U.S. And we will be looking to roll that out over the next couple of quarters with that specific distribution partner.

Rob Goff
And perhaps, in terms of your distribution partner, would you be targeting large enterprise, mid enterprise or any sort of target profiles you could provide?

Karen Adams
Yes. I think with this specific distribution partner, I would say we are looking in the mid-market which is still large in the U.S., as you know. So we are looking at the mid-market right now and using the mental health assessment and the navigation platform becomes relatively easy for us to deliver across the U.S. So we are very excited about earning this opportunity with this broker.

Rob Goff
Very good. Thank you.

Karen Adams
Thank you.

Operator
Thank you. Our next question comes from Gabriel Leung with Beacon Securities. Your line is now open.

Gabriel Leung
Good afternoon and thanks for taking my questions. A couple things. First, just curious if you guys are able to provide an update on, I guess, the large corporate client that was onboarded on the enterprise side, I guess, a couple of months ago? Whether you have an update on how things are progressing there?

Karen Adams
So we launched that client and things to the client satisfaction is very high. It's very early to tell the outcome because we are in the client launched at the beginning, the end of April, beginning in May. So we are still in the early days. So most of the first quarter was in the implementation of that large client.

Gabriel Leung
Got you. So what are some of the metrics that you or your client will be gauging, will be reviewing to gauge whether the pilot is a success or not?

Karen Adams
That's a great question. So the first thing is access. So the number of people who access the program is our first metric. So they have a population base who are looking for access. So far, it is the most successful program they have launched. Note, those are their words. So we will be looking at access. We will also be looking at the people who utilize the resources. So we do have a number of online resources, both through iMD which is our educational resource company and through Snapclarity. So we will be gauging those. And then the third is people who are in need of treatment and the success ratio around the treatment. But those will be longer term metrics, just by the nature of the number of sessions required for people to actually get help through mental health. So the short term metrics that we are really focused on is, access, satisfaction with the resources and then access to care, if that makes sense.

Gabriel Leung
Got you. And then just staying on enterprise for a minute here. As I think about growth going forward, I think about pipeline of new potential customers. I also think about increasing utilization by members themselves. So I am curious if you can talk a little bit about both. What you are seeing in terms of pipeline opportunities, number one? Number two is, I guess on the EAP side, with HumanaCare, it's obviously early, but whether you have seen any evidence of increased utilization by members via some of the additional services that you can now offer?

Karen Adams
Yes. So it's early days. I always have to remind myself that it's early days. We did see, in the first quarter, an increase of 17% utilization of EFAP services. What I think you will see in the coming month, one the metrics that we are starting to measure is the number of customers utilize more than one services. As I mentioned in my remarks, we have through the integration team, structured a cross-sell team. So the sales people have all been trained on the product and are now in the process of taking to their clients the combined product offering. And so that is that is we are measuring and selling through our pipeline at this point.

And I guess, the other thing I should say, I guess the other thing just that I should mention that's important to bring you, it just occurred to me as you said it. the EFAP really has, in the first quarter, I think when you look at the number of new lives that they added to the platform and the utilization, they have done an incredibly good job in the first quarter. So we are up over Q4 as far as utilization. And most of that is attributed to the distribution partnership that they were able to secure in Q4 that launched in January of Q1. So that really is where we saw the uptick on the number of lives added to the platform, which was just over 6,000 lives.

Gabriel Leung
Got you. And actually just on that front, going forward, as Oncidium is brought into the mix and as the EAP practice gets bigger, to help us model, I guess, would you think that CloudMD will be in a position to provide metrics around members and so the PMPM and things like that? So you think that will be coming down the road?

Karen Adams
Yes. So we will just have to look at that because the Oncidium business is on a price per employee per month model. So the Oncidium model is more of a case price. They do medical management, case management, which is a case price. And then, of course, the EFAP is a price per employee per month. So I think it would be fair to assume tat we will be in a position to talk about cross-selling our ability to take EFAP product and market it to the Oncidium clients to create that market-leading product. We believe we have a market leading product that those customers are going to want. And so we will be in a position to talk about that at that point as those quarters rollout.

Gabriel Leung
Got you. That was helpful. And maybe one last question.

Karen Adams
Sure.

Gabriel Leung
Just as I think about growth going forward, is there sort of a target bookings number that management is aiming towards achieving whether in calendar 2021 or calendar 2022, now that you are very close to getting everything onboarded? Is there a number that you guys thought about or sort of targeting at this point?

Karen Adams
Daniel, did you want to take that?

Daniel Lee
Sure. So Gabe, we do internal meetings about this. We are not, I guess, at this time just ready to share that information. But we do analyze our business and review not only just our financials but also all key APIs, internal targets, et cetera. But we will certainly take it under advisement in terms of just additional information to share with you on what's going forward.

Gabriel Leung
Got you. I appreciate the feedback. Thank you.

Operator
Thank you. Our next question comes from Nick Agostino with Laurentian Bank Securities. Your line is now open.

Nick Agostino
Hi. Yes. Good afternoon. I guess my first question, I just want to make sure I heard clearly and then ask the question on the back of that is, Essam, did you say, you are seeing 20% increase in patient visits every quarter, I guess, since you launched the virtual care program? And if the number being the case, can you maybe provide some clarity around what the split is between virtual, the use your telehealth program versus in-person into your clinics? And then adding to that same question, how much repeat business are you guys seeing on the whole virtual care side of it?

Essam Hamza
Yes. Thanks Nick. So you are right. The number I think I did quote was 20%, I believe, quarter-over-quarter. That is with regards to the CloudMD app. So let me step back for a second and kind of describe what we have and what we have built. So we have the clinics, our clinics that are brick-and-mortar that we have converted into that hybrid clinic and when COVID hit, a lot of clinics around the country and around the world had to shutdown and unless you had a way to reach out to the patients, a lot of them lost revenue. We didn't.

We were able to close the physical door and open up our virtual doors immediately and those doctors in our network that are seeing patients for our company were continue to see them through our virtual platform that's seamless basically. So the same platform they use to see a patient in-person is the same platform that they can use to see the patient virtually, the same chart and everything else. So our own doctors within our network were able to turn on virtual care for the most part 100% of their visits in early on and still a great majority right now are virtual basically for those doctors seeing their own patients.

On top of that, we launched our CloudMD app in BC and Ontario. And that CloudMD app was for patients that didn't have a doctor or didn't have an access to doctor, it was amazing when we first launched it. Obviously with COVID, it allowed a lot of patience to see a doctor when they had no other options. And they were in distress and so on. So they are very grateful and we had great success with it. But on top of it, we have seen 20% quarter-over-quarter growth in that and those are repeat customers as well. So they are coming in.

They are seeing our doctors. It's not just, we don't only have family doctors that are seeing these patients. We have nurses. We have mental health professionals and so on that can help, we can send them for bloodwork. We can send them for referrals. We follow-up with them. We can address their concerns. We reach out to them and their families and so on. So we provide full care for them, not just episodic care. So that's the growth in the number of visits through the app is what we were referring to there and it continues to grow going forward.

Why I bring this up though is that we have created this full platform and this ecosystem that is going to continue even post-COVID because it is providing the full ecosystem of care to those patients. It's full care for all their needs basically. And it also has the ability to cross into and support our enterprise health division as well. So that's the reason that we build it the way we built it. It's sustainable. It's profitable. And it's growing not only as a standalone but as integrated with our EHS and our other divisions as well. So that's what we were referring to, if that helps.

Nick Agostino
Yes. Okay. Great. Thank you. And my second question is, I believe you have closed five acquisitions in the quarter itself, if I recall reading correctly. My question is, now that you had these companies as part of the CloudMD umbrella, you are able to look under the hood, any surprises upwards or downwards and specifically on revenue? In other words, is the revenue you are generating off of each and every one of those acquisitions that you closed in line with what your expectations that you provided?

Essam Hamza
Yes. Nick, I will start with that and I can hand it over to Karen or Dan. But yes, the reason we bought, remember these are companies we strategically went out and pursued. They were not for sale. They joined us because they share the same kind of vision in where healthcare is going. And the great thing about it is, they are already growth companies. They are already profitable. And we are able to add fuel to what they are offering immediately and have the ability to provide our network of patients and providers to what they already had. So the cross-selling has helped every one of our companies that we bought on so far. We did make reference to it in an earlier press release in the quarter, if you remember, mentioning the fact that as of the first two, three months of that quarter in the enterprise health division that they were able to recognize $5 million of new contracts just early on, just from since we closed it to the them that we released that press release.

So maybe Karen, you can refer a little bit to that. But before you do, we also mentioned IDYA4 in the same realm as well, saying that they were awarded another $1.5 million at the time that we announced that close.

Karen Adams
Yes. So I would just say a couple of things, Nick, to add to that. So yes, we are seeing organic growth that is, I would say, in line with our expectations because as Essam mentioned these were targeted strategic. They were known to us. I understand their capabilities very, very well. And to putting them together in a way that with a strong client base made sense. The second piece and I have to remind myself that these acquisitions being Q1, being January, we have done some incredible work around the synergies. And these synergies, I think, are coming together naturally because of the understanding of the people who work within these acquisitions, the importance of putting these products together. So they are motivated to be part of a synergistic exercise as opposed to when you do acquisition sometimes the synergistic opportunities have to be forced and you are looking for rationale for people. So people are gravitating quite easily. So when we look to the acquisitions from Q4 and we look at the ones we are doing now, including IDYA4, the traction to come together is very easy.

And the other piece, I think is important to acknowledge is we are leveraging capabilities outside of EHS, meaning we have had Snapclarity integrated into the virtual care product. We are using the digital services and we will be using the acquisitions we have talked about going forward that might be outside of the EHS as capabilities that will be connected in the ecosystem.-And I am pretty proud of the team that we have been able to not only get the $1.5 million in inorganic growth, but also the synergies that we have been able to recognize and the team working forward and the clients are coming to us and asking for proposals for these integrated offering, which is accelerating the need for the synergies. So where I sit, I am very pleased and I would say we are right where we expected to be with the traction. I would say, probably maybe even a little ahead of time as far as the activity base goes getting us to move forward with the synergies. So I am very pleased.

Nick Agostino
Okay. Thank you. That was all.

Operator
As there are no further questions, this concludes today's conference call. Thank you for participating. You may now disconnect.