VANCOUVER, BC, Nov. 12, 2020 /PRNewswire/ - CRH Medical
Corporation (TSX: CRH) (NYSE MKT: CRHM) ("CRH" or the
"Company"), today announced financial and operating results for the
three months ended September 30,
2020.
Third quarter 2020 highlights:
- Total revenue of $30.3 million,
down 0.2% from third quarter 2019
- Anesthesia services revenue of $28.0
million, up 0.1% from third quarter 2019
- Product sales revenue of $2.4
million, down 3.4% from third quarter of 2019
- Anesthesia patient cases of 94,052 increased 6.0% from third
quarter 2019
- Adjusted operating EBITDA of $11.8
million, down 9.3% from third quarter 2019
- Adjusted operating shareholder EBITDA of $8.0 million, a decrease of 15.2% from third
quarter 2019
- Through the first nine months of 2020, the Company generated
$24.8 million in cash from operating
activities and $16.1 million in free
cash flow
- The Company also completed three acquisitions and one startup
joint venture
Tushar Ramani, Chair and Chief
Executive Officer of CRH, commented: "Although COVID-19 continued
to exert a negative impact upon both of our business segments in
the third quarter, we were encouraged by the 125% increase in
anesthesia revenue and the 104% increase in O'Regan revenue as
compared to Q2 2020. We remain confident in our ability to execute
against our key business initiatives in order to extend and augment
our growth trajectory."
Conference Call
CRH will host a conference call to discuss its results on
Friday, November 13, 2020, at
8:30 am ET (5:30 am PT). To participate in the conference,
please dial 1-888-664-6392, or 1-416-764-8659 and reference
confirmation #64836562. An audio replay will be available shortly
after the call by dialing 1-888-390-0541 or 1-416-764-8677 and
entering access code 836562#. The replay will be available for two
weeks after the call.
About CRH Medical Corporation:
CRH Medical Corporation is a North American company focused on
providing gastroenterologists throughout the United States with innovative services and
products for the treatment of gastrointestinal diseases. In 2014,
CRH became a full-service gastroenterology anesthesia company that
provides anesthesia services for patients undergoing endoscopic
procedures in ambulatory surgical centers. To date, CRH has
completed 30 anesthesia acquisitions, and now serves 66 ambulatory
surgical centers in 13 states. In addition, CRH owns the CRH
O'Regan System, a single-use, disposable, hemorrhoid banding
technology that is safe and highly effective in treating all grades
of hemorrhoids. CRH distributes the O'Regan System, treatment
protocols, operational and marketing expertise as a complete,
turnkey package directly to gastroenterology practices, creating
meaningful relationships with the gastroenterologists it serves.
CRH's O'Regan System is currently used in all 48 lower US
states.
Non-GAAP Measures
This press release makes reference to certain non-GAAP financial
measures including adjusted operating EBITDA (in total and broken
down as attributable to non-controlling interest and shareholders
of the Company) and adjusted operating EBITDA margin as
supplemental indicators of its financial and operating
performance. Adjusted operating EBITDA is defined as
operating income before interest, taxes, depreciation,
amortization, stock based compensation, acquisition related
expenses and asset impairment charges. Adjusted operating EBITDA
margin is defined as operating earnings before interest, taxes,
depreciation, amortization, stock based compensation, acquisition
related expenses and asset impairment charges as a percentage of
revenue. These non-GAAP measures are not recognized measures under
US Generally Accepted Accounting Principles ("US GAAP") and do not
have a standardized meaning prescribed by US GAAP and thus the
Company's definition may be different from and unlikely to be
comparable to non-GAAP measures presented by other companies. These
measures are provided as additional information to complement US
GAAP measures by providing further understanding of the Company's
results of operations from management's perspective. Accordingly,
they should not be considered in isolation nor as a substitute for
analyses of the Company's financial information reported under US
GAAP. Management uses non-GAAP measures such as adjusted operating
EBITDA and adjusted operating EBITDA margin to provide investors
with a supplemental measure of the Company's operating performance
and thus highlight trends in the Company's core business that may
not otherwise be apparent when relying solely on US GAAP financial
measures. Management also believes that securities analysts,
investors and other interested parties frequently use non-GAAP
measures in the evaluation of issuers. In addition, management uses
these non-GAAP measures in order to facilitate operating
performance comparisons from period to period, prepare annual
operating budgets, and to assess its ability to meet future debt
service, capital expenditure, and working capital requirements. A
quantitative reconciliation of adjusted operating EBITDA, and
operating EBITDA margin to the most directly comparable measures
under US GAAP is presented below.
Cautionary Note Regarding Forward-looking Statements
Information included or incorporated by reference in this press
release may contain forward-looking statements. This information
may involve known and unknown risks, uncertainties, and other
factors which may cause our actual results, performance, or
achievements to be materially different from the future results,
performance, or achievements expressed or implied by any
forward-looking statements. Forward-looking statements, which
involve assumptions and describe our future plans, strategies, and
expectations, are generally identifiable by use of the words "may,"
"will," "should," "expect," "anticipate," "estimate," "believe,"
"plan," "intend" or "project" or the negative of these words or
other variations on these words or comparable terminology. Certain
risks underlying our assumptions are highlighted below; if risks
materialize, or if assumptions prove otherwise to be untrue, our
results will differ from those suggested by our forward looking
statements and our results and operations may be negatively
affected. Forward looking statements in this press release include
statements regarding the Company's future growth. Actual events or
results may differ materially from those discussed in
forward-looking statements. There can be no assurance that the
forward-looking statements currently contained in this report will
in fact occur. The Company bases its forward-looking statements on
information currently available to it. The Company disclaims any
intent or obligations to update or revise publicly any
forward-looking statements whether as a result of new information,
estimates or options, future events or results or otherwise, unless
required to do so by law.
Forward-looking information reflects current expectations of
management regarding future events and operating performance as of
the date of this document. Such information involves significant
risks and uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not such results will be achieved. A
number of factors could cause actual results to differ materially
from the results discussed in forward-looking information,
including, without limitation: Our ability to predict developments
in the COVID-19 pandemic and its impact to our operations; changes
to payment rates or methods of third-party payors, including
United States government
healthcare programs, changes to the
United States laws and regulations that regulate payments
for medical services, the failure of payment rates to increase as
our costs increase, or changes to our payor mix, could adversely
affect our operating margins and revenues; We are subject to
decreases in our revenue and profit margin under our fee for
service contracts and arrangements, where we bear the risk of
changes in volume, payor mix, radiology, anesthesiology, and
pathology benefits, and third-party reimbursement rates; We may or
may not successfully identify and complete corporate transactions
on favorable terms or achieve anticipated synergies relating to any
acquisitions or alliances, and such acquisitions could result in
unforeseen operating difficulties and expenditures, or require
significant management resources and significant charges; Our
senior management has been key to our growth, and we may be
adversely affected if we lose any member of our senior management;
ASCs or other customers may terminate or choose not to renew their
agreements with us; If we are unable to maintain or increase
anesthesia procedure volumes at our existing ASCs, the operating
margins and profitability of our anesthesia segment could be
adversely affected; We may not be able to successfully recruit and
retain qualified anesthesia service providers or other independent
contractors; We may be unable to enforce the non-competition and
other restrictive covenants in our agreements; We operate in an
industry that is subject to extensive federal, state, and local
regulation, and changes in law and regulatory interpretations;
Changes in the medical industry and the economy may affect the
Company's business; Our failure to comply with U.S. federal and
state fraud and abuse laws, including anti-kickback laws and other
U.S. federal and state anti-referral laws, could have a material,
adverse impact on our business; A significant number of our
affiliated physicians could leave our affiliated ASCs; Our industry
is already competitive and could become more competitive;
Unfavorable economic conditions could have an adverse effect on our
business; The Company may not be successful in marketing its
products and services; Failure to manage third-party service
providers may adversely affect our ability to maintain the quality
of service that we provide; Congress or states may enact laws
restricting the amount out-of-network providers of services can
charge and recover for such services; Adverse events related to our
product or our services may subject us to risks associated with
product liability, medical malpractice or other legal claims,
insurance claims, product recalls and other liabilities, which may
adversely affect our operations; Our dependence on suppliers could
have a material adverse effect on our business, financial condition
and results of operations; We may need to raise additional capital
to fund future operations; We are subject to various restrictive
covenants and events of default under the Credit Facilities; The
Affordable Care Act ("ACA") and potential changes to it may have a
significant effect on our business; The Medicare Access and CHIP
Reauthorization Act of 2015 ("MACRA") and potential changes to it
may have a significant effect on our business; Government
authorities or other parties may assert that our business practices
violate antitrust laws; If regulations or regulatory
interpretations change, we may be obligated to re-negotiate
agreements of our anesthetists, anesthesiologists or other
contractors; Despite current indebtedness levels, we may still be
able to incur substantially more debt, which could further
exacerbate the risks associated with increased leverage; Failure to
timely or accurately bill for services could have a negative impact
on our net revenue, bad debt expense and cash flow; If we or some
of our suppliers fail to comply with the FDA's Quality System
Regulation and other applicable requirements, our manufacturing or
processing operations could be disrupted, our sales and
profitability could suffer, and we may become subject to a wide
variety of FDA enforcement actions; If we fail to maintain an
effective system of internal control over financial reporting, we
may not be able to accurately report our financial results or
prevent fraud. As a result, shareholders could lose confidence in
our financial and other public reporting, which would harm our
business and the trading price of our common shares; Our industry
is the subject of numerous governmental investigations into
marketing and other business practices which could result in the
commencement of civil and/or criminal proceedings, substantial
fines, penalties, and/or administrative remedies, divert the
attention of our management, and have an adverse effect on our
financial condition and results of operations; We may write-off
intangible assets; If we are unable to manage growth, we may be
unable to achieve our expansion strategy; The continuing
development of our products and provision of our services depends
upon us maintaining strong relationships with physicians;
Significant shareholders of the Company could influence our
business operations, and sales of our shares by such significant
shareholders could influence our share price; We have a legal
responsibility to the minority owners of the entities through which
we own our anesthesia services business, which may conflict with
our interests and prevent us from acting solely in our own best
interests; Our common shares may be subject to significant price
and volume fluctuations; Unfavorable changes or conditions could
occur in the states where our operations are concentrated: We may
be subject to a variety of regulatory investigations, claims,
lawsuits, and other proceedings; Our anesthesia employees and
third-party contractors may not appropriately record or document
services that they provide; If we are unable to adequately protect
or enforce our intellectual property, our competitive position
could be impaired; If there is a change in federal or state laws,
rules, regulations, or in interpretations of such federal or state
laws, rules or regulations, we may be required to redeem our
physician partners' ownership interests in anesthesia companies
under the savings clause in our joint venture operating agreements;
Our employees and business partners may not appropriately secure
and protect confidential information in their possession; Failure
to protect our information technology infrastructure against
cyber-based attacks, network security breaches, service
interruptions or data corruption could significantly disrupt our
operations and adversely affect our business and operating results;
If securities or industry analysts do not publish research, or
publish inaccurate or unfavorable research, about our business, our
share price and trading volume could decline; We may be subject to
criminal or civil sanctions if we fail to comply with privacy
regulations regarding the protection, use and disclosure of patient
information; Evolving regulation of corporate governance and public
disclosure may result in additional expenses and continuing
uncertainty; Anti-takeover provisions could discourage a third
party from making a takeover offer that could be beneficial to our
shareholders; We are an "emerging growth company" and a "smaller
reporting company," and any decision on our part to comply only
with certain reduced reporting and disclosure requirements
applicable to such companies could make our common shares less
attractive to investors; We do not intend to pay dividends on our
common shares, and, consequently, your ability to achieve a return
on your investment will depend on appreciation, if any, in the
price of our common shares; Tax reform could have a material
adverse effect on us; Income tax audits and changes in our
effective income tax rate could affect our results of operations;
The patent protection for our products may expire before we are
able to maximize their commercial value, which may subject us to
increased competition and reduce or eliminate our opportunity to
generate revenues; and We may face exposure to adverse movements in
foreign currency exchange rates.
For a complete discussion of the Company's business including
the assumptions and risks set out above, see the Company's Form
10-K Annual Report, which is available on EDGAR at
www.sec.gov/edgar.shtml or on the Company's website at
www.crhmedcorp.com.
Condensed Consolidated Balance
Sheets
(unaudited)
|
|
|
September
30,
2020
|
|
|
December
31,
2019
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
|
5,099,498
|
|
|
$
|
6,568,716
|
|
Trade and other
receivables, net
|
|
|
|
20,358,880
|
|
|
|
20,041,288
|
|
Income tax
receivable
|
|
|
|
3,252,973
|
|
|
|
1,332,129
|
|
Loan to equity
investment
|
|
|
|
1,000
|
|
|
|
—
|
|
Prepaid expenses and
deposits
|
|
|
|
426,589
|
|
|
|
729,483
|
|
Inventories, finished
goods
|
|
|
|
296,070
|
|
|
|
349,324
|
|
|
|
|
|
29,435,010
|
|
|
|
29,020,940
|
|
Non-current
assets:
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
|
|
201,959
|
|
|
|
251,933
|
|
Right of use
asset
|
|
|
|
1,094,732
|
|
|
|
214,854
|
|
Intangible assets,
net
|
|
|
|
168,325,328
|
|
|
|
163,108,193
|
|
Deferred asset
acquisition costs
|
|
|
|
228,777
|
|
|
|
59,249
|
|
Investment
|
|
|
|
2,016,076
|
|
|
|
—
|
|
Deferred tax
assets
|
|
|
|
12,945,311
|
|
|
|
10,440,100
|
|
|
|
|
|
184,812,183
|
|
|
|
174,074,329
|
|
Total
assets
|
|
|
$
|
214,247,193
|
|
|
$
|
203,095,269
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
Trade and other
payables
|
|
|
$
|
7,449,298
|
|
|
$
|
6,196,741
|
|
Employee
benefits
|
|
|
|
786,115
|
|
|
|
992,845
|
|
Income tax
payable
|
|
|
|
—
|
|
|
|
28,589
|
|
Current portion of
lease liability
|
|
|
|
241,742
|
|
|
|
125,555
|
|
Deferred
consideration
|
|
|
|
—
|
|
|
|
1,868,052
|
|
Earn-out
obligation
|
|
|
|
686,973
|
|
|
|
1,063,060
|
|
Contract payable - CMS
Advance
|
|
|
|
1,808,952
|
|
|
|
—
|
|
Member loan
|
|
|
|
220,880
|
|
|
|
68,600
|
|
|
|
|
|
11,193,960
|
|
|
|
10,343,442
|
|
Non-current
liabilities:
|
|
|
|
|
|
|
|
|
|
Lease
liability
|
|
|
|
865,372
|
|
|
|
54,300
|
|
Contract payable - CMS
Advance
|
|
|
|
91,636
|
|
|
|
—
|
|
Contingent
liability
|
|
|
|
2,617,110
|
|
|
|
—
|
|
Notes payable and bank
indebtedness
|
|
|
|
74,997,205
|
|
|
|
68,380,345
|
|
Deferred tax
liabilities
|
|
|
|
23,786
|
|
|
|
101,822
|
|
|
|
|
|
78,595,109
|
|
|
|
68,536,467
|
|
Equity
|
|
|
|
|
|
|
|
|
|
Common stock, no par
value; 71,461,684 and 71,603,584 shares issued and outstanding at
September 30, 2020 and December 31, 2019, respectively
|
|
|
|
56,268,562
|
|
|
|
56,056,113
|
|
Additional paid-in
capital
|
|
|
|
8,648,801
|
|
|
|
7,168,156
|
|
Accumulated other
comprehensive loss
|
|
|
|
(66,772)
|
|
|
|
(66,772)
|
|
Retained
earnings
|
|
|
|
7,423,053
|
|
|
|
13,154,981
|
|
Total equity
attributable to shareholders of the Company
|
|
|
|
72,273,644
|
|
|
|
76,312,478
|
|
Non-controlling
interest
|
|
|
|
52,184,480
|
|
|
|
47,902,882
|
|
Total
equity
|
|
|
|
124,458,124
|
|
|
|
124,215,360
|
|
Total liabilities and
equity
|
|
|
$
|
214,247,193
|
|
|
$
|
203,095,269
|
|
Condensed Consolidated Statements of
Operations
(unaudited)
|
|
|
Three months ended September 30,
|
|
|
Nine months ended September 30,
|
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anesthesia
services
|
|
|
$
|
27,983,903
|
|
|
$
|
27,966,629
|
|
|
$
|
63,561,613
|
|
|
$
|
82,685,905
|
|
Product
sales
|
|
|
|
2,365,549
|
|
|
|
2,448,174
|
|
|
|
5,827,537
|
|
|
|
7,330,147
|
|
|
|
|
|
30,349,452
|
|
|
|
30,414,803
|
|
|
|
69,389,150
|
|
|
|
90,016,052
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anesthesia services
expense
|
|
|
|
26,963,897
|
|
|
|
23,774,049
|
|
|
|
70,580,981
|
|
|
|
69,804,891
|
|
Product sales
expense
|
|
|
|
1,080,861
|
|
|
|
1,089,316
|
|
|
|
3,025,258
|
|
|
|
3,441,207
|
|
Corporate
expense
|
|
|
|
2,219,867
|
|
|
|
1,838,812
|
|
|
|
6,344,402
|
|
|
|
4,645,347
|
|
|
|
|
|
30,264,625
|
|
|
|
26,702,177
|
|
|
|
79,950,641
|
|
|
|
77,891,445
|
|
Operating income
(loss)
|
|
|
|
84,827
|
|
|
|
3,712,626
|
|
|
|
(10,561,491)
|
|
|
|
12,124,607
|
|
Net finance
expense
|
|
|
|
441,967
|
|
|
|
1,125,410
|
|
|
|
1,386,007
|
|
|
|
5,696,343
|
|
(Gain) loss from
equity investment
|
|
|
|
—
|
|
|
|
(77,278)
|
|
|
|
37,839
|
|
|
|
(416,584)
|
|
Other
income
|
|
|
|
(289,669)
|
|
|
|
—
|
|
|
|
(5,146,488)
|
|
|
|
—
|
|
Income (loss) before
tax
|
|
|
|
(67,471)
|
|
|
|
2,664,494
|
|
|
|
(6,838,849)
|
|
|
|
6,844,848
|
|
Income tax expense
(recovery)
|
|
|
|
(376,237)
|
|
|
|
565,165
|
|
|
|
(1,584,165)
|
|
|
|
736,052
|
|
Net and comprehensive
income (loss)
|
|
|
$
|
308,766
|
|
|
$
|
2,099,329
|
|
|
$
|
(5,254,684)
|
|
|
$
|
6,108,796
|
|
Attributable
to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders of the
Company
|
|
|
$
|
(337,954)
|
|
|
$
|
982,368
|
|
|
$
|
(5,324,264)
|
|
|
$
|
2,552,084
|
|
Non-controlling
interest
|
|
|
|
646,720
|
|
|
|
1,116,961
|
|
|
|
69,580
|
|
|
|
3,556,712
|
|
|
|
|
$
|
308,766
|
|
|
$
|
2,099,329
|
|
|
$
|
(5,254,684)
|
|
|
$
|
6,108,796
|
|
Earnings (loss) per
share attributable to shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
(0.005)
|
|
|
$
|
0.014
|
|
|
$
|
(0.074)
|
|
|
$
|
0.036
|
|
Diluted
|
|
|
$
|
(0.005)
|
|
|
$
|
0.013
|
|
|
$
|
(0.074)
|
|
|
$
|
0.035
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
71,506,045
|
|
|
|
71,831,356
|
|
|
|
71,558,371
|
|
|
|
71,845,812
|
|
Diluted
|
|
|
|
71,506,045
|
|
|
|
72,799,142
|
|
|
|
71,558,371
|
|
|
|
73,023,144
|
|
Condensed Consolidated Statements of Cash
Flows
(unaudited)
|
|
|
Three months
ended
September
30,
|
|
|
Nine months
ended
September
30,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
Operating
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
308,766
|
|
$
|
2,099,329
|
|
$
|
(5,254,684)
|
|
$
|
6,108,796
|
Adjustments
for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of
property, equipment and intangibles
|
|
|
10,760,397
|
|
|
8,555,909
|
|
|
29,686,467
|
|
|
25,974,283
|
Stock-based
compensation
|
|
|
652,967
|
|
|
706,479
|
|
|
1,900,960
|
|
|
280,348
|
Unrealized foreign
exchange
|
|
|
6,144
|
|
|
(50)
|
|
|
7,745
|
|
|
726
|
Deferred income tax
recovery
|
|
|
(968,387)
|
|
|
(776,300)
|
|
|
(2,358,260)
|
|
|
(2,749,616)
|
Change in fair value
of contingent consideration
|
|
|
(96,294)
|
|
|
181,805
|
|
|
(376,087)
|
|
|
2,771,238
|
Accretion on
contingent consideration and deferred
consideration
|
|
|
15,925
|
|
|
10,145
|
|
|
32,833
|
|
|
123,305
|
Amortization of
deferred financing fees
|
|
|
90,411
|
|
|
65,091
|
|
|
269,424
|
|
|
195,273
|
(Gain) loss from
equity investment
|
|
|
—
|
|
|
(77,278)
|
|
|
37,839
|
|
|
(416,584)
|
Change in current tax
receivable
|
|
|
(1,699,529)
|
|
|
(17,826)
|
|
|
(2,174,418)
|
|
|
(154,474)
|
Change in trade and
other receivables
|
|
|
(820,666)
|
|
|
(182,433)
|
|
|
(317,593)
|
|
|
(102,733)
|
Change in prepaid
expenses
|
|
|
102,542
|
|
|
(59,218)
|
|
|
302,894
|
|
|
268,162
|
Change in
inventories
|
|
|
(31,017)
|
|
|
153,837
|
|
|
53,254
|
|
|
45,309
|
Change in trade and
other payables, including contract
payable
|
|
|
(640,539)
|
|
|
(83,936)
|
|
|
3,192,069
|
|
|
91,726
|
Change in employee
benefits
|
|
|
135,957
|
|
|
135,609
|
|
|
(206,730)
|
|
|
234,120
|
Net cash provided by
operating activities
|
|
|
7,816,677
|
|
|
10,711,163
|
|
|
24,795,713
|
|
|
32,669,879
|
Financing
activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
(repayment of) member loans
|
|
|
(28,100)
|
|
|
(14,375)
|
|
|
152,280
|
|
|
(18,375)
|
Equity investment
loan
|
|
|
(1,000)
|
|
|
—
|
|
|
(1,000)
|
|
|
—
|
Repayment of
short-term advances
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26,783)
|
Payment of deferred
consideration
|
|
|
(64,827)
|
|
|
—
|
|
|
(1,896,850)
|
|
|
(1,100,000)
|
Payment of contingent
consideration
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,795,822)
|
Repayment of notes
payable and bank indebtedness
|
|
|
(1,500,000)
|
|
|
(5,625,000)
|
|
|
(9,500,000)
|
|
|
(13,175,000)
|
Proceeds from bank
indebtedness
|
|
|
11,006,750
|
|
|
7,000,000
|
|
|
16,006,750
|
|
|
11,300,000
|
Proceeds from exercise
of stock options
|
|
|
—
|
|
|
6,753
|
|
|
10,680
|
|
|
426,366
|
Payment of deferred
financing fees
|
|
|
(125,000)
|
|
|
—
|
|
|
(159,314)
|
|
|
—
|
Distributions to
non-controlling interest
|
|
|
(3,952,150)
|
|
|
(3,615,819)
|
|
|
(8,688,260)
|
|
|
(11,804,480)
|
Repurchase of shares
for cancellation
|
|
|
(296,600)
|
|
|
(1,109,170)
|
|
|
(652,165)
|
|
|
(3,982,914)
|
Acquisition of equity
interest from non-controlling interest
|
|
|
—
|
|
|
(7,018,658)
|
|
|
—
|
|
|
(9,434,009)
|
Net cash provided by
(used in) financing activities
|
|
|
5,039,073
|
|
|
(10,376,269)
|
|
|
(4,727,879)
|
|
|
(32,611,017)
|
Investing
activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of
property and equipment
|
|
|
(10,957)
|
|
|
(4,834)
|
|
|
(32,829)
|
|
|
(45,681)
|
Deferred asset
acquisition costs
|
|
|
56,488
|
|
|
38,437
|
|
|
(191,934)
|
|
|
(440)
|
Distribution received
from equity investment
|
|
|
—
|
|
|
92,400
|
|
|
—
|
|
|
92,400
|
Purchase adjustment
relating to anesthesia service providers
acquired
in prior periods
|
|
|
—
|
|
|
4,366,000
|
|
|
—
|
|
|
4,366,000
|
Acquisition of cost
investment
|
|
|
(2,016,076)
|
|
|
—
|
|
|
(2,016,076)
|
|
|
—
|
Acquisition of
anesthesia services providers
|
|
|
(11,024,903)
|
|
|
(2,174,003)
|
|
|
(19,296,746)
|
|
|
(9,204,437)
|
Net cash provided by
(used in) investing activities
|
|
|
(12,995,448)
|
|
|
2,318,000
|
|
|
(21,537,585)
|
|
|
(4,792,158)
|
Effects of foreign
exchange on cash and cash equivalents
|
|
|
2,134
|
|
|
(270)
|
|
|
533
|
|
|
1,395
|
Decrease in cash and
cash equivalents
|
|
|
(137,564)
|
|
|
2,652,624
|
|
|
(1,469,218)
|
|
|
(4,731,901)
|
Cash and cash
equivalents, beginning of period
|
|
|
5,237,062
|
|
|
2,562,420
|
|
|
6,568,716
|
|
|
9,946,945
|
Cash and cash
equivalents, end of period
|
|
$
|
5,099,498
|
|
$
|
5,215,044
|
|
$
|
5,099,498
|
|
$
|
5,215,044
|
Adjusted EBITDA Reconciliation
(in
thousands, unaudited)
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
(USD in
thousands)
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Net and
comprehensive income (loss)
|
|
$
|
309
|
|
$
|
2,099
|
|
$
|
(5,254)
|
|
$
|
6,109
|
Net finance
expense
|
|
|
442
|
|
|
1,125
|
|
|
1,386
|
|
|
5,696
|
(Gain) loss on equity
investment
|
|
|
—
|
|
|
(77)
|
|
|
38
|
|
|
(416)
|
Income tax expense
(recovery)
|
|
|
(376)
|
|
|
565
|
|
|
(1,584)
|
|
|
736
|
Other income -
government assistance
|
|
|
(290)
|
|
|
—
|
|
|
(5,147)
|
|
|
—
|
Operating income
(loss)
|
|
|
85
|
|
|
3,713
|
|
|
(10,561)
|
|
|
12,125
|
Amortization
expense
|
|
|
10,735
|
|
|
8,528
|
|
|
29,604
|
|
|
25,892
|
Depreciation and
related expense
|
|
|
26
|
|
|
28
|
|
|
83
|
|
|
82
|
Stock based
compensation
|
|
|
653
|
|
|
706
|
|
|
1,901
|
|
|
280
|
Acquisition
expenses1
|
|
|
57
|
|
|
83
|
|
|
87
|
|
|
123
|
Inventory
write-downs
|
|
|
—
|
|
|
—
|
|
|
65
|
|
|
—
|
Other non-recurring
items2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
931
|
Other income -
government assistance
|
|
|
290
|
|
|
—
|
|
|
5,147
|
|
|
—
|
Total adjusted
operating EBITDA
|
|
$
|
11,845
|
|
$
|
13,058
|
|
$
|
26,324
|
|
$
|
39,433
|
Adjusted operating
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
attributable to:
|
|
|
|
Shareholders of the
Company
|
|
$
|
7,968
|
|
$
|
9,392
|
|
$
|
17,520
|
|
$
|
27,819
|
Non-controlling
interest
|
|
$
|
3,877
|
|
$
|
3,666
|
|
$
|
8,804
|
|
$
|
11,615
|
Adjusted Operating Expense
Reconciliation
(in thousands, unaudited)
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Anesthesia
services expense
|
|
|
26,964
|
|
|
23,774
|
|
|
70,581
|
|
|
69,804
|
Amortization
expense
|
|
|
(10,734)
|
|
|
(8,527)
|
|
|
(29,602)
|
|
|
(25,890)
|
Depreciation and
related expense
|
|
|
(3)
|
|
|
(3)
|
|
|
(11)
|
|
|
(9)
|
Stock based
compensation
|
|
|
(148)
|
|
|
(125)
|
|
|
(349)
|
|
|
(359)
|
Acquisition
expenses1
|
|
|
(57)
|
|
|
(83)
|
|
|
(87)
|
|
|
(123)
|
Anesthesia
services – adjusted operating
|
|
|
16,022
|
|
|
15,036
|
|
|
40,532
|
|
|
43,424
|
expense
|
|
|
Product sales
expense
|
|
|
1,081
|
|
|
1,089
|
|
|
3,025
|
|
|
3,440
|
Amortization
expense
|
|
|
(1)
|
|
|
(1)
|
|
|
(1)
|
|
|
(2)
|
Depreciation and
related expense
|
|
|
(5)
|
|
|
(5)
|
|
|
(15)
|
|
|
(19)
|
Stock based
compensation
|
|
|
(95)
|
|
|
(82)
|
|
|
(210)
|
|
|
(236)
|
Inventory
write-downs
|
|
|
—
|
|
|
—
|
|
|
(65)
|
|
|
—
|
Product sales -
adjusted operating expense
|
|
|
980
|
|
|
1,002
|
|
|
2,733
|
|
|
3,186
|
Corporate
expense
|
|
|
2,220
|
|
|
1,839
|
|
|
6,345
|
|
|
4,645
|
Amortization
expense
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
Depreciation and
related expense
|
|
|
(18)
|
|
|
(20)
|
|
|
(57)
|
|
|
(55)
|
Stock based
compensation
|
|
|
(410)
|
|
|
(500)
|
|
|
(1,343)
|
|
|
313
|
Other non-recurring
items
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(931)
|
Corporate -
adjusted operating expenses
|
|
|
1,792
|
|
|
1,319
|
|
|
4,945
|
|
|
3,974
|
Total operating
expense
|
|
|
30,265
|
|
|
26,702
|
|
|
79,951
|
|
|
77,891
|
Total adjusted
operating expense
|
|
|
18,794
|
|
|
17,357
|
|
|
48,211
|
|
|
50,583
|
View original
content:http://www.prnewswire.com/news-releases/crh-medical-corporation-announces-2020-third-quarter-results-301172464.html
SOURCE CRH Medical Corporation