Q3 2021 Paysign Inc Earnings Call
Hello, and welcome to the peace of mind third quarter 2021 earnings Conference call. As a reminder, this conference is being recorded. This presentation may include forward looking statements to the extent that the information presented in this presentation discusses financial projections information or expectations about the company's business.
Results of operations the impact of COVID-19 returns on equity expected gross margins markets or otherwise make statements about future events such statements are forward looking such forward looking statements can be identified by the use of words, such as should May intends anticipates believes estimates projects forecast expects plan.
And proposals.
Although the company believes that the expectations reflected in these forward looking statements are based on reasonable assumptions. There are a number of risks and uncertainties that could cause actual results of different materially from such a polar looking statements, you'll hershey carefully reviewing consider any cautionary statements and any disclosures, including the statements made under the heading risk factors and elsewhere as a Form 10-K.
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Forward looking statements speak only as of the date of the document and which are contained and the company does not undertake any duty to update any forward looking statements expect except as may be required by law.
This presentation also who's adjusted EBITDA non-GAAP financial measure that is neither prepared in accordance with Norton alternative to financial measures prepared in accordance based on any standardized methodology prescribed by gap and it's not necessarily comparable to similarly titled measures presented by other companies. They saw my pleasure, it's trying to comb over.
Mark Newcomer and please go ahead.
Kevin Good afternoon, everyone and thank you for joining us for pay signs third quarter of 2021, or just a call I am Mark newcomer Chief Executive Officer, and joined who made this happen and as Jeff Baker, Our Chief Financial Officer.
We are extremely pleased to report continued improvements in our revenue and operating results this quarter.
Our net revenue for the quarter was 7.8 million a 7.9 million dollar increase from the third quarter of last year.
And the quarterly sequential increase of 1.1 million or 16.8% as well as an almost three fold increase in our adjusted EBITDA as compared to second quarter of this year or third quarter total gross funds loaded increased 24.7% from the year ago period and increased seven.
6% from the previous quarter.
Plasma gross buns loaded increased 42.7% year over year and 10.3% from the previous quarter.
Throughout the quarter, we experienced improved the results each month, despite the U S customs and border protection decision limiting the ability for Mexican citizens to donate plasma which remains in place.
And the quarter, we onboarded seven additional plasma centers, bringing our total number of centers to 359. This includes the net result of the loss of four centres, which were sold by a client to a non client plasma collection company.
Lee we're expecting a total of 10 additional centres to be on board. It by the end of the year.
And our patient affordability vertical we continue the secret progress and growth.
During the third quarter, we launched three of the five new patient affordability programs, we sign in the second quarter, We launched the fourth program in October and the fifth program is on schedule, an expected to launch in the fourth quarter.
And the third quarter, we renewed to form a prepaid programs and signed an additional pharma co pay program, which is expected to also launch in the fourth quarter of pending F. D. A approval of the drug.
We continue to make investments in our patient affordability products and personnel during.
During the third quarter, our patient affordability pipeline continued to grow in in late October we sponsored the S. M. B, a specialty pharmacy summit in Las Vegas.
We received the overwhelmingly positive feedback on our suite of services and solutions and on presentations made to potential clients reinforcing are optimistic outlook for the segment in 2022 and further in our pipeline well beyond next year.
Additionally, I am pleased to announce that we sign an agreement with Central L. O C. This quarter to provide program management and processing services for their existing payroll card spectra as a pay access solutions provider that offers a payroll card and patented money earned benefit which allows employees to access up to 50% of their network.
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Well, we have yet to see our plasma volumes returned with prepandemic levels due to the lingering economic effects of the pandemic. We are very pleased with our third quarter results. We saw growth in both plasma and patient affordability and we expect this trend to continue we were also very excited about the interest in our patient affordability products.
Build that are unique capabilities place us at the intersection I'll send tech and health care and give us the ability to bridge the gaps left by our competitors.
Lastly, I would also like to thank everyone on the pay sign team for their continued dedication and hard work with that I'll pass it over to Jeff to give you more insight of our financials for the quarter.
Thank you Mark good afternoon, everyone Bollock out we had a solid third quarter as mixing it in the press release revenue loss from operations EBITDA and adjusted EBITDA, all improve sequentially and year over year and our balance sheet improved sequentially. As a result of the quarter's performance, while the third quarter continue to be impacted by Covid.
19, a government stimulus measures is expected we did see improving trends as we move through the quarter.
All of our total revenues of $7.8 million plasma revenue accounted for $7 million or 91% pharma revenue was $660000 and other revenue was $71000 or gross margin for the quarter was 51.1%, which was aided slightly by two pharmaceutical programs ending allowing us to wreck.
Nice settlement income of under $100000, we were able to renew both programs under our non settlement income model.
S. D N a expenses were $3.6 million and total operating expenses were $4.2 million or net loss for the quarter was $271000.
Adjusted EBITDA, which we define as operating income plus depreciation and amortization and stock based compensation and as a non-GAAP metric used by management to gauge the operating performance of the business was $955000 or two cents per fully diluted share outstanding 52.5 million.
Third quarter gross dollar volume.
Increased 25% versus the year ago period, as we experienced an improvement in plasma donations.
Restricted cash ended the quarter at $63.3 million.
Third quarter purchase volume increased 33.9% versus the year ago period, and our revenue conversion rate, which is revenue divided by gross dollar loads increased over the second quarter.
Taking a look at the plasma business for the quarter revenues the $7 million were up $1.8 million from the same period last year when the U S was under a lockdown the average revenue per month her plasma center was $6542 versus $5828.
Last year, and we exited the quarter with 359 centers versus 304 centers at the end of Q3 last year.
Turning your attention to the pharma business third quarter 2021 revenues of $660000 increased $6 million compared to the third quarter of 2020, primarily driven by the change in the county that estimate last year and the termination of one program in December 2020, and one program in April 2021.
As Martin mentioned, we continue to renew and with new mandates in the pharma business, giving us good momentum and at 2022 and beyond.
Cost of revenues for the period increased $516000 compared to the same period in the prior year, primarily due to the increase in plasma transactions as many of the plasma transaction costs are variable in nature.
Gross profit for the quarter increased $7.4 million compared to the same period last year due to the increase in both plasma and pharma revenue.
We continue to make significant investments in our business to give us the support and technological capabilities needed to efficiently efficiently grow the business and launch new prepaid programs.
Thus depreciation and amortization increased 16.8% year over year to $628000.
Regarding the health of our company, we exited the quarter was $6.9 million in unrestricted cash and zero debt, which is an increase of $300000 from our second quarter ending cash balance.
Based on our forecast, we believe that we remain well capitalized in position to weather any further impacts from COVID-19, and its variants.
Lastly, I wanted to direct your attention to the press release, where we have updated our thoughts for the remainder of 2021.
For the full year, we continue to expect total revenue to be in the range of $29 million to $32 million, reflecting growth of 20% to 32%.
Increasing the lower end of our adjusted EBITDA guidance to arrange at $1.3 million to $1.9 million or gross profit margins are expected to be at least 49% for the full year.
Pull your operating expenses are expected to remain flat at $17.6 million or increased slightly to $17.8 million with sequential increase is expected due to seasonal operate it'll operational expenditures incurred during the fourth quarter dip.
Depreciation and amortization expense is expected to be approximately $2.5 million for the full year and stock based compensation expense is expected to be approximately $2.4 million for the full year.
This outlook presumes that we continue to see a recovery and plasma business in the fourth quarter and we roll out new pharma programs that we have signed with that I would like to turn the call over to the moderator for questions and answers.
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At this time I'd like to turn the floor back over management for any further closing comments.
Thanks, Kevin I'd like to again, thanks to pay for my team further dedication and all their hard work during the quarter.
Wanna, Thank everybody for joining us for todays call. Thank you very much and have a nice evening.
Think of the just conclude today's teleconference and webcast me disconnect. Your lines at this time and have a wonderful day, we thank you for your participation today.