CINCINNATI--(BUSINESS WIRE)--HealthWarehouse.com, Inc. (OTC: HEWA) announced today that net sales for the first quarter ended March 31, 2019, increased 9% to $3,889,423 compared with $3,584,611 in the first quarter of 2018.
HealthWarehouse.com is a Verified Internet Pharmacy Practice Site (VIPPS) accredited online and mail-order pharmacy authorized to sell and deliver prescription medications to all 50 states. The Company attributed its 2019 first quarter sales performance to diversified marketing strategies and improved patient outreach.
“Our active prescription customers now exceed 100,000 for the first time in company history. The sustained growth in our customer base is proof that we continue to be an affordable and convenient option for people in need of prescription medications,” said Joseph Peters, the Company’s President and CEO. “In a recent survey of active prescription customers (customers that have ordered within the past twelve months), we found that over 60% of respondents currently have prescription insurance coverage, but Healthwarehouse.com provides medications at prices below their copay amounts or is a cost-effective option for medications not covered by their insurance plans. Respondents also noted the added benefits and exceptional convenience offered through HealthWarehouse.com’s unique business model and dedication to customer service.”
Peters noted that investments in pharmacy robotics and infrastructure have shortened processing times, allowing HealthWarehouse.com to maintain or reduce the prices of its prescription medications while increasing volume.
“Those investments have improved our operating leverage which allowed us to generate approximately $213,000 in Adjusted EBITDA during the quarter,” he said. “Our team remains dedicated to providing customers with excellent pharmacy experiences through compassion, convenience and transparency. Additionally, we continue to evaluate funding options to support an expansion of our marketing campaigns, an upgrade of our pharmacy software, and the refinancing of our current debt obligations.”
2019 Financial Overview:
Net Sales: Total net sales were $3,889,423 for the three months ended March 31, 2019, compared with $3,584,611 in 2018, an increase of $304,813 or 9%. Core consumer prescription sales were $3,072,470 for the three months ended March 31, 2019, compared with $2,812,779 in 2018, an increase of $259,691 or 9%. Over-the-counter net sales grew 10% to $740,644 compared with $673,799 in 2018. The growth in both categories was due in part to increased advertising spend.
Gross Profit: Gross profit for the three months ended March 31, 2019 was $2,594,917, a $232,949 or 10% increase over the same period in 2018, due to sales growth.
Operating Expenses: SG&A expenses were $2,539,348 for the three months ended March 31, 2019, a decrease of $105,055 or 4% as compared to the same quarter in 2018. The reduction in 2019 resulted from improved operational efficiencies related to the installation of automation equipment and reductions in marketing and legal expenses.
Net Income and Adjusted EBITDA: The Company reported a net loss of $17,685 for the first quarter of 2019 compared with a net loss of $340,750 during the same period in 2018. For the first quarter, Adjusted EBITDA was $213,228 in 2019 compared with $(163,190) in 2018, an improvement of $376,418.
| HEALTHWAREHOUSE.COM, INC. AND SUBSIDIARIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
| (Unaudited) | |||||||||||
| For the Three Months Ended | |||||||||||
| March 31, | |||||||||||
| 2019 | 2018 | ||||||||||
| Net sales | $ | 3,889,423 | $ | 3,584,611 | |||||||
| Cost of sales | 1,294,506 | 1,222,643 | |||||||||
| Gross profit | 2,594,917 | 2,361,968 | |||||||||
| Operating Expenses: | |||||||||||
| Selling, general and administrative expenses | 2,539,348 | 2,644,403 | |||||||||
| Net income (loss) from operations | 55,569 | (282,435 | ) | ||||||||
| Interest expense | (73,254 | ) | (58,316 | ) | |||||||
| Net loss | (17,685 | ) | (340,751 | ) | |||||||
| Preferred stock: | |||||||||||
| Series B convertible contractual dividends | (85,558 | ) | (85,558 | ) | |||||||
| Net loss attributable to common stockholders | $ | (103,243 | ) | $ | (426,309 | ) | |||||
| Per share data: | |||||||||||
| Net loss - basic & diluted | ($0.00 | ) | ($0.01 | ) | |||||||
| Series B convertible contractual dividends | ($0.00 | ) | ($0.00 | ) | |||||||
| Net loss attributable to common stockholders - basic and diluted | ($0.00 | ) | ($0.01 | ) | |||||||
| Weighted average number of common shares outstanding - basic & diluted | 49,390,251 | 48,225,985 | |||||||||
|
Reconciliation of Net Income (Loss) (GAAP) to Adjusted EBITDA (Non-GAAP) |
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| Three Months Ended | |||||||||||||
| March 31, | |||||||||||||
| (Unaudited) | 2019 | 2018 | |||||||||||
| Net loss | $ | (17,685 | ) | $ | (340,751 | ) | |||||||
| Interest expense | 73,254 | 58,316 | |||||||||||
| Depreciation and amortization | 42,737 | 16,330 | |||||||||||
| EBITDA | 98,306 | (266,105 | ) | ||||||||||
| Non-GAAP adjustments: | |||||||||||||
| Stock-based compensation | 114,922 | 96,024 | |||||||||||
| Loss on disposal of equipment | - | 7,807 | |||||||||||
| Adjusted EBITDA | $ | 213,228 | $ | (162,274 | ) | ||||||||
About HealthWarehouse.com
HealthWarehouse.com, Inc. (OTC Pink:HEWA) is a trusted VIPPS accredited online pharmacy based in Florence, Kentucky. The Company is focused on the out of pocket prescription market, which is expected to exceed $50 billion in 2019. With a mission to provide affordable healthcare to every American by focusing on technology that is revolutionizing prescription delivery, HealthWarehouse.com has become the largest VIPPS accredited online pharmacy in the United States exclusively servicing the cash market.
HealthWarehouse.com is licensed or authorized to ship prescription medication to all 50 states and the District of Columbia and only sells drugs that are FDA-approved and legal for sale in the United States. Visit HealthWarehouse.com online at http://www.HealthWarehouse.com.
Forward-Looking Statements
This announcement and the information incorporated by reference herein contain “forward looking statements” as defined in federal securities laws, including but not limited to Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995, which statements are based on our current expectations, estimates, forecasts and projections. Statements that are not historical facts, including statements about the beliefs, expectations and future plans and strategies of the Company, are forward-looking statements. Actual results may differ materially from those expressed in forward looking statements or in management's expectations. Important factors which could cause or contribute to actual results being materially and adversely different from those described or implied by forward looking statements include, among others, risks related to competition, management of growth, access to sufficient capital to fund our business and our growth, new products, services and technologies, fluctuations in operating results, international expansion, outcomes of legal proceedings and claims, fulfillment center optimization, seasonality, commercial agreements, acquisitions and strategic transactions, foreign exchange rates, system interruption, cyber-attacks, access to sufficient inventory, government regulation and taxation, payments and fraud. More information about factors that potentially could affect HealthWarehouse.com's financial results is included in HealthWarehouse.com's audited Annual Reports and Quarterly Reports available at otcmarkets.com and its prior filings with the Securities and Exchange Commission.
Use of Non-GAAP Financial Measures
HealthWarehouse.com, Inc. (the "Company") prepares its consolidated financial statements in accordance with the United States generally accepted accounting principles ("GAAP"). In addition to disclosing financial results prepared in accordance with GAAP, the Company discloses information regarding Adjusted EBITDA, which is commonly used. In addition to adjusting net loss to exclude interest, depreciation and amortization (“EBITDA”), Adjusted EBITDA also excludes stock-based compensation, and certain other nonrecurring charges. Adjusted EBITDA is not a measure of performance defined in accordance with GAAP. However, Adjusted EBITDA is used internally in planning and evaluating the Company`s performance. Accordingly, management believes that disclosure of this metric offers investors, bankers and other shareholders an additional view of the Company`s operations that, when coupled with the GAAP results, provides a more complete understanding of the Company’s financial results.
Adjusted EBITDA should not be considered as an alternative to net loss or to net cash used in operating activities as a measure of operating results or of liquidity. It may not be comparable to similarly titled measures used by other companies, and it excludes financial information that some may consider important in evaluating the Company`s performance.