TORONTO--(BUSINESS WIRE)--Mednow Inc. (“Mednow’' or the “Company”) (TSXV: MNOW) (OTCQB:MDNWF), Canada’s on-demand virtual pharmacy, is pleased to provide a corporate update on its upcoming fiscal Q3 2022 quarterly earnings, which will be released in June 2022.
Financial Performance and Key Performance Indicators
In fiscal Q3 2022, Mednow is forecasted to have quarterly revenue of $5 - $5.5M, quarter-over-quarter growth of approx. 175%. Mednow’s second quarter 2022 results have highlighted strong quarter-over-quarter performance with revenue growth of 230% or C$1.9 compared to first quarter 2021 revenue of C$570K. Patients grew 20% to 19K patients versus the previous quarter. Mednow’s second quarter gross margin was 19%, with a cash balance of C$16M.
On February 24, 2022, Mednow provided annual forecasted growth figures for the calendar years 2022 and 2023. For the calendar year 2022, revenue is forecasted to range between C$42.5M to C$47.5M. Contributions of approximately C$42M are anticipated to come from its pharmacy services, while approximately C$3M is anticipated to come from doctor services. The gross margin is expected to average at approximately 20%, with 40K - 45K active patients, and a net loss for the year. For the calendar year 2023, Mednow is expected to produce adjusted EBITDA of approximately $5M - $10M. Revenue for 2023 is forecasted to range between C$105M to C$110M, with C$102M contributed by pharmacy services and C$5M coming from doctor services. The gross margin is expected to average at approximately 25%, with 110K - 120K active patients.
Operational Milestones
Mednow currently operates in the Provinces of British Columbia, Ontario, Nova Scotia and Manitoba. On April 18, 2022, Mednow launched a licensed pharmacy in Winnipeg, which offers prescription delivery services in the Province of Manitoba.
On March 31, 2022, Mednow closed the previously announced acquisition of a pharmacy in Toronto (“Mednow East”). Mednow East is a Toronto company that operates an online and brick-and-mortar pharmacy, delivering prescriptions in the Province of Ontario.
Mednow plans to launch its Montreal, Quebec fulfillment centre in May 2022. The Company plans to launch the Calgary, Alberta fulfillment centre later this year.
About Mednow Inc.
Mednow is a healthcare technology company offering virtual access with a high-standard of care. Designed with accessibility and quality of care in mind, Mednow.ca provides virtual pharmacy and telemedicine services as well as doctor home visits through an interdisciplinary approach to healthcare that is focused on the patient experience. Mednow’s services include free at-home delivery of medications, a user-friendly interface for easy upload, transfer, and refill of prescriptions, access to healthcare professionals through an intuitive chat experience, a specialized PillSmart™ system that packages prescriptions, and vitamins by date and time, and doctor consultations.
To learn more, follow Mednow on Facebook, Twitter, LinkedIn, and Instagram, or visit our website at www.mednow.ca/.
Neither 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 NOTE REGARDING FORWARD-LOOKING STATEMENTS
DEFINITIONS OF CERTAIN NON-IFRS FINANCIAL MEASURES
This press release uses certain non-IFRS financial measures which are defined below. Non-IFRS financial measures are not standardized financial measures under International Financial Reporting Standards (“IFRS”). As such, these measures may not be comparable to similar financial measures that are disclosed by other companies. These measures include “EBITDA” and “Adjusted EBITDA”. These measures should not be reviewed and assessed as a substitute for financial information reported under IFRS. A reconciliation of the non-IFRS measures to the IFRS measure is below.
RECONCILIATION OF NON-IFRS FINANCIAL MEASURES
The following are reconciliations of net loss and comprehensive loss to EBITDA. The adjustments include:
- The amortization and depreciation expenses of intangible assets, fixed assets, and the right-of-use assets of the Company.
- The interest expenses, which primarily includes interest expense on the Company’s credit facility and interest expense recorded in accordance with IFRS 16.
The following are reconciliations of EBITDA to Adjusted EBITDA. The adjustments include:
- The loss on investment in equity securities in connection with the Company’s investment in Life Support Mental Health Inc.
- The share-based compensation expense recorded by the Company in connection with its stock option plan.
- The acquisition costs incurred by the Company for its completed and pending acquisitions.
The exclusion of certain items in calculating the non-IFRS measures does not imply that they are non-recurring, infrequent, unusual or not useful to investors.
Additional information relating to the composition of Adjusted EBITDA and an explanation of how Adjusted EBITDA provides useful information to an investor and the additional purposes, if any, for which management uses Adjusted EBITDA is incorporated herein by reference to the Company’s Management’s Discussion and Analysis for the period ended January 31, 2022 filed on March 23, 2022 (the “MD&A”) under the Company’s profile on www.sedar.com. The relevant information can be found on page 23 of the MD&A under the heading “Definitions of Certain Non-IFRS Financial Measures.”
EQUIVALENT HISTORICAL NON-GAAP MEASURE
| For the month ended | ||||
| January 31, 2022(Unaudited) | ||||
| Net loss and comprehensive loss for the period | $ |
(1,784,021 |
) |
|
| Interest expense |
|
8,106 |
|
|
| Depreciation and amortization |
|
109,258 |
|
|
| EBITDA1 |
|
(1,666,657 |
) |
|
| Loss on investment in equity securities |
|
16,063 |
|
|
| Share-based compensation |
|
366,361 |
|
|
| Acquisition costs |
|
49,463 |
|
|
| Adjusted EBITDA1 |
|
(1,234,770 |
) |
|
EBITDA and Adjusted EBITDA has been discussed in the section "Definitions of Certain Non-IFRS Financial Measures" in the Company's MD&A for the period ended January 31, 2022 available under the Company’s profile on www.sedar.com.
There is no difference between the Adjusted EBITDA that is forward-looking information referenced in the body of this press release and the equivalent historical Adjusted EBITDA presented in the table above.
This release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. All statements in this press release, other than statements of historical facts, including statements regarding future estimates, plans, objectives, timing, assumptions or expectations of future performance, including without limitation, Mednow’s Q3 2022 forecasted revenue of C$5 - C$5.5 million, and expected quarter-over-quarter growth of 175%; the Company’s expectation that in 2022 the Company’s revenue will range between C$42.5M and C$47.5M, the Company’s expectation that the Company’s 2022 gross margin will average at approximately 20%, with 40,000 to 45,000 active patients, and be at a net loss for the year, the Company’s expectation that revenue for the 2023 calendar year will range between C$105M and C$110M, the Company’s expectation that the Company’s 2023 gross margin will average at approximately 25%, with 110,000 to 120,000 active patients, the Company’s expectation that it will produce adjusted EBITDA of approximately $5M to $10M in the 2023 calendar year, the Company’s intention to launch its Montreal, Quebec pharmacy fulfillment centre by May 2022 and a Calgary, Alberta fulfillment center later this year are forward-looking statement and contains forward-looking information. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as “intends” or “anticipates”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “should”, “would” or “occur”.
Forward-looking statements are based on certain material assumptions and analysis made by the Company and the opinions and estimates of management as of the date of this press release, including that during the next 12 months, the Company will build and open retail pharmacies in the provinces of Alberta and Quebec, the Company will have national delivery capabilities in summer 2022, the Company will be successful in the deployment of its resources and personnel, the Company’s operations will not be adversely impacted by COVID-19, the availability of financing, the cost of planned expansion, third party contractors and supplies and governmental and other approvals required to conduct the Company’s planned activities will be available on reasonable terms and in a timely manner and that general business and economic conditions will not change in a material adverse manner, the Company will be successful in its targeted marketing campaigns and advertising initiatives that will allow the Company to grow its active patients to 40,000 to 45,000 active users in calendar 2022 and 110,000 to 120,000 active patients in calendar 2023, the Company will be successful in growing its active users to its estimated target range in calendar 2022 and calendar 2023, which will allow the Company to generate between C$42.5 million and C$47.5 million of revenue, average gross margin of 20% and a net loss in calendar 2022, and between C$105 million and C$110 million of revenue, average gross margin of 25% and adjusted EBITDA in the range of $5 million to $10 million in its calendar 2023 year, the Company will be able to continue to buy medications and other goods at reasonable prices and underlying purchase terms to achieve its expected gross margin in calendar 2022 and calendar 2023, the Company will be able to control operating costs to be able to achieve its target and forecasted earnings and adjusted EBITDA, the Company’s web and mobile application will be able to support a higher number of patients and users who will use the application to transact with the Company, and the Company will be successful in its strategic objectives, including the integration of existing business acquisitions and the pursuit of other investments and acquisitions.
These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Important factors that may cause actual results to vary, include, without limitation, changes in market conditions, fluctuations in the currency markets, changes in national and local governments, legislation, taxation, controls, regulations, and political or economic developments in Canada or other countries in which the Company may carry on business in the future; risks relating to the credit worthiness or financial condition of suppliers and other parties with whom the Company does business; inadequate insurance or inability to obtain insurance to cover these risks; availability and increasing costs associated with operational inputs and labor; business opportunities that may be presented to, or pursued by the Company; the Company’s ability to successfully integrate acquisitions; the ongoing economic impacts of the COVID 19 pandemic, and the risk factors discussed or referred to in the Company’s disclosure documents under the Company’s profile at www.sedar.com Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Management is providing the future oriented financial information in this press release in order to assist shareholders and potential investors in understanding the Company’s financial and business targets. Readers are cautioned that reliance on such information may not be appropriate for other purposes. Other than as required by applicable regulations and laws, the Company does not undertake to update any forward-looking statement, forward-looking information or financial outlook.
