“4:05p ET 11/10/2021 - Dow Jones
Press Release: LifeMD Reports Q3 2021 Revenue Up 127% to Record $24.9 Million and 24% Sequential Improvement in Adjusted EBITDA
LifeMD Reports Q3 2021 Revenue Up 127% to Record $24.9 Million and 24% Sequential Improvement in Adjusted EBITDA
-- Revenue increased to a record $24.9 million, up 127% from the same year-ago period -- 24% sequential improvement in Adjusted EBITDA versus prior quarter -- 93% of Q3 2021 revenue generated by subscriptions, up from 61% in the same year-ago period -- Total telehealth order volume grew 153% to 232,293
NEW YORK, Nov. 10, 2021 (GLOBE NEWSWIRE) -- LifeMD, Inc. (NASDAQ: LFMD), a leading direct-to-patient telehealth company, reported results for the third quarter ended September 30, 2021. All figure comparisons are to the same year-ago quarter unless otherwise noted. Management will host a conference call today at 5:00 p.m. Eastern time to discuss the results.
Q3 Financial Highlights
-- Record revenue of $24.9 million, up 127% -- 93% of revenue generated by subscriptions, up from 61% -- Gross profit totaled $19.9 million, or 80% of net revenues, up 113% -- Adjusted EBITDA of $(9.0) million, a 24% sequential improvement versus the prior quarter (see definition of this non-GAAP financial measure and reconciliation to GAAP, below) -- Adjusted EPS of $(0.36), a 25% sequential improvement versus the prior quarter (see definition of this non-GAAP financial measure and reconciliation to GAAP, below)
Q3 Operational Highlights
-- Achieved significant leverage improvement in marketing investment expenses, reducing marketing spend as a percentage of revenue to 81% versus 100% in the prior quarter, with continued leverage expected. -- Total unique patients and customers served nationwide surpassed 427,000 during the quarter, up from over 360,000 in the prior quarter. -- Telemedicine orders increased 153% to approximately 232,000. -- Appointed seasoned investor and private equity professional Naveen Bhatia to its Board of Directors. Most notably, Mr. Bhatia served as Senior Managing Director in the Tactical Opportunities group of Blackstone for nearly a decade and as director of numerous public and private companies.
Subsequent Events
-- Completed a public offering of 3,833,334 shares of its common stock and 1,400,000 shares of its 8.875% Series A Cumulative Perpetual Preferred Stock raising approximately $55 million in net proceeds. -- Announced transformational launch of our 50-state Virtual Primary Care business, which we expect to drive increased satisfaction with our existing patients and open the door to many new treatment areas for LifeMD.
Key Performance Metrics
($ in 000s) Three Months Ended September 30 Y-o-Y --------------------------------------- -------- Key Performance Metrics 2021 2020 % Growth -------------- ---------------- --------------- -------- Revenue -------------- Telehealth $ 18,541 $ 9,438 96% WorkSimpli $ 6,406 $ 1,568 309% Total Revenue $ 24,947 $ 11,006 127% Subscription Revenue as % of Total 93% 61% 52% Platform Contribution $ 17,478 $ 8,136 115% Telehealth Volume -------------- Total Telehealth Orders 232,293 91,955 153% WorkSimpli -------------- Active Subscribers 139,248 35,240 295%
Management Commentary
"Q3 was an especially strong quarter for our business. Not only did we experience record revenue of $24.9 million supported by record demand for our telehealth products and services, but we demonstrated the early stages of our ability to enhance our profitability while growing our top-line aggressively. I am especially proud of our team's ability to drive meaningful sequential improvement in our Adjusted EBITDA and expect these sequential improvements to continue as we push toward achieving our goal of Adjusted EBITDA break-even by the fourth quarter of 2022," said Justin Schreiber, CEO of LifeMD. "Additionally, I, along with the entire team, am extremely excited about the recently announced launch of Virtual Primary Care which we believe is a game-changing step in the evolution of our company as we continue to become a disruptive force in healthcare. We expect this launch to not only diversify and strengthen our telehealth offering but also to drive meaningful long-term improvements in our already strong unit economics and retention, all while taking the holistic care we provide patient customers to an entirely new level."
LifeMD CFO Marc Benathen, commented: "As we've committed to previously, we remain laser-focused on not only aggressively growing our top-line, but also scaling with gradually improving profitability. We began to demonstrate our ability to execute upon that commitment this quarter by delivering a 24% sequential improvement in Adjusted EBITDA driven by strong retention metrics in our telehealth business and further optimization of our media spend. At the same time, we grew our revenue by 127% versus prior year. Following the quarter end, we successfully completed an over-subscribed offering of Preferred and Common Stock which has put LifeMD in its strongest capital position ever and we believe can capitalize LifeMD through profitability while continuing to invest in our aggressive growth. We reiterate our expectation of achieving Adjusted EBITDA break-even by the fourth quarter of 2022."
Q3 2021 Financial Summary
-- Revenue increased 127% to a record $24.9 million from $11.0 million in the same year-ago quarter. The WorkSimpli subsidiary, which operates PDFSimpli, an online software-as-a-service (SaaS) platform, increased 309% to $6.4 million. -- Gross profit increased by 113% to $19.9 million, compared to $9.3 million in the same year-ago quarter. Gross margin was 80% as compared to 85% in the year-ago quarter, primarily due to product sales mix and one-time, non-cash write-off of legacy product deposits. -- Platform Contribution, a non-GAAP financial measure, totaled $17.5 million, compared to $8.1 million in the same year-ago period (see definition of this non-GAAP financial measure and reconciliation to GAAP, below). -- Operating expense in the third quarter of 2021 was $32.4 million, up from $29.9 million in the same year-ago quarter with operating leverage improved by 2,300 basis points versus the prior quarter due to significant leverage realized in selling and marketing expense, general and administrative expenses and strong retention metrics. The increase in expense versus prior year was primarily due to increases in selling and marketing expenses of $9.8 million in the quarter, other operating expenses of $272,000, customer services expenses of $275,000, and development costs of approximately $13,000. General and administrative expenses decreased $7.7 million during the quarter driven by a $13.3 million decrease in stock-based compensation expense and included non-cash expenses for stock-based compensation and amortization expenses of $4.8 million. -- Net loss attributable to common stockholders for the third quarter of 2021 was $14.4 million or $(0.54) per share, as compared to a net loss attributable to common stockholders of $24.2 million or $(1.65) per share in the third quarter of 2020. -- Excluding $3.1 million related to stock-based compensation expense, $1.6 million related to the non-cash amortization of debt discount, $0.1 million related to depreciation and amortization expense and $0.2 million related to financing transaction expense, Adjusted EPS, a non-GAAP basis, totaled a loss of $(0.36) per share as compared to a loss of $(0.52) in the same year-ago period. Adjusted EPS improved 25% sequentially versus the prior quarter (see definition of this non-GAAP financial measure and reconciliation to GAAP, below). -- Adjusted EBITDA, a non-GAAP financial measure, totaled a loss of $9.0 million, compared to an adjusted EBITDA loss of $3.8 million in the same year-ago period. Adjusted EBITDA improved 24% sequentially versus the prior quarter (see definition of this non-GAAP financial measure and reconciliation to GAAP, below).
2021 Financial Outlook
The company reiterates its expectation for revenue in the full year of 2021 to total between $90 million and $100 million, which would represent growth of between 141% and 168% over the prior year.
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