Q4 2021 NantHealth Inc Earnings Call

Mr. Jaffe. Please go ahead.

Today are Ron Louks, Chief operating officer, and Bob Petro, our Chief Financial Officer.

This call is being broadcast live at Www Dot net health Dot com.

<unk> will be available for three months on NAND helps website.

I'd like to make the cautionary statement and remind everyone that all of the information discussed on today's call is covered under the safe Harbor provisions of the litigation Reform Act.

The company's discussion today will include forward looking information, reflecting management's current forecast of certain aspects of the company's future and actual results could differ materially from those stated or implied.

In addition, during the course of this call we may refer to non-GAAP financial measures that are not prepared in accordance with U S. Generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies.

Investors are encouraged to review <unk> press release announcing its full 2021 fourth quarter and full year financial results for.

For the company's reasons for including those non-GAAP financial measures.

And its financial results announcement.

Reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures is also contained in the company's earnings press release issued earlier today.

In a moment, Rob will discuss the business followed by Bob who will discuss the financial results. We will then open the call for questions with.

With that said I will now turn the call over to Ron books, Brian .

Thanks, Robert Good afternoon, everyone and welcome to <unk> 2021 fourth quarter and full year financial results Conference call.

We hope all of you have been safe and well since our last call I.

I'd like to start today with some comments about the Companys recent past and then share a few comments on the upcoming year for.

For some time, we have been working to position <unk> for sustainable growth. These efforts have included refocusing our business on software and services divesting noncore assets acquiring the complimentary business open NMS group and reducing costs throughout the organization, when and where appropriate.

Same time, however, we continue to build out our capabilities and invested in product development regular launching new and enhanced products and services.

Fortunately last April we also completed a major refinancing which provided financial flexibility and more recently, we expanded and strengthened our senior management team.

As a result, we believe we are now positioned for topline growth and excited about the opportunities and prospects across our entire portfolio.

Turning briefly to our fourth quarter financial results as expected revenue and gross margins increased in Q4 from Q3 levels revenue in Q4 was approximately $16 million, which was a return to our average quarterly run rate for 2021.

Pleased to have ended the year on a high note, which includes recording the highest quarterly revenue contribution from our open NMS group in a short time as part of the new handheld family.

Now, let's discuss our software and services business, beginning with our equity business in the fourth quarter, We signed and went live with equity connect for autoimmune diseases with Maryland physicians care. The autoimmune diseases program is the first application for avid connect beyond oncology and as we said previously developments underway for additional disease States.

We continued to expand every connector oncology with the addition of the largest customer owned health insurer in the U S. We expanded utilization management certification to include three new states.

So that customers can Kentucky, Florida, and Massachusetts, now have access to fully Dale delegate it end to end services.

And we signed a new partner agreement to provide product offerings that improve the management of care logistics for complex high risk and chronic diseases.

The payer engagement.

And a multiyear agreement with a new third party administrator that we used at Avnet open to enhance the services. It provides to self insured health plan customers, we recorded 17% year over year growth for an avnet, all payer advantage, our direct to provider solutions.

We lost a union health partner portal, which offers payer customer self service on demand access to interactive reporting on workflows, <unk> analytics and insights and we enhanced Navidad open authorizations, which helps died users through its submission of clinical criteria information and supporting documentation.

We entered into an alliance agreement with change healthcare to integrate the <unk> connect automation solution with Navidad open.

This allows the avnet payer customers to leverage Intercall medical review criteria in there.

Net based electronic prior authorization workflow.

And we signed an agreement with prior off now which enables prior off now to automate the streamline prior authorization request for its clients.

Turning to our network monitoring business open NMS.

We partnered with a fortune 500 managed service provider to offer open Ms Brittany and monitoring for more than 150 of its customers.

We released open animus horizon, 'twenty nine featuring support for persisting forward data to cortex, and approve streaming analytics for flows at scale.

NMS opinion virtual appliance and cloud enabled service to help organizations quickly reliably and securely deploy opening analyst meeting collectors promote or adjacent private networks and finally on an expedited basis, we delivered updates to address the global log for Jay vulnerability collaborating closely with open NMS open source community.

To sum up we sign and went live without any connect for autoimmune diseases with a key customer. This is the first application for heavy connect beyond oncology and customer interest in this new offering is strong we have and will continue to develop and expand our capabilities and invest and launch new and enhanced products and services across our offering and we have built a strong foundation for our company.

We are excited about the opportunities and prospects for each of our businesses. We believe 2022 will be a year of topline growth without over here business I'll turn the call over to Bob to discuss our financial results in more detail Bob.

Thank you Ron for Q4, 2021, total revenue was $16 million compared with $18 6 million in the prior year fourth quarter.

For the full year of 2021 total revenue was $62 6 million compared with $73 2 million in the prior year.

The quarter on quarter decline and the year over year decline as referenced in the past was mostly tied to reduction in the amortization of professional services that impacted all of 2021.

Gross profit for the quarter was $9 1 million or 57%, which is a decrease from $11 4 million or 61% for the same quarter in the prior year.

The decline is tied to the lower revenue in the quarter compared to previous year, but do expect gross margin to get back to normalized levels in 2022 as revenue growth.

Total operating expenses increased 15, 1% to $20 9 million from our $18 2 million in the prior year fourth quarter, which is driven by our continued investment in our products and service offerings.

Year over year total operating expenses increased seven 9% to $75 7 million.

$70 2 million in the prior year is driven by the acquisition of opening on the mess in Q3 of 2020 as we now had a full year of opening <unk> expenses in 2021.

For Q4 2021 net loss from continuing operations was $16 7 million or <unk> 14 per share this compared with $20 1 million or <unk> 18 per share in the prior year fourth quarter.

For the full year 2021, net loss from continuing operations was $58 3 million or 51 per share, which is compared with $88 3 million or <unk> 80 per share in the prior year.

On a non-GAAP basis net loss from continuing operations. In Q4, 2021 was 11 8 million or <unk> 10 per share, which is compared to $6 2 million or <unk> <unk> per share for the fourth quarter of last year.

For the full year on a non-GAAP basis net loss from continuing operations. In 2021 was 41 9 million or <unk> 37 per share as compared with $27 million or 24 per share in the last year, which is mainly tied to our lower revenue in 2021.

Finally, cash and cash equivalents were approximately $29 million at December 31, 2021, which is compared to $45 5 million at September 32021.

Usage of cash was approximately $16 4 million, which was driven by the final $9 5 million payment over a convertible notes Forum 2016, and then the remaining other working capital needs.

With that I will now turn the call back over to Robert.

Thanks, Bob operator that completes our prepared portion of the todays call were now please open up the call to questions.

Thank you ladies and gentlemen, the floor is now open for questions.

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I'm pleased probably pull for questions.

Yeah.

We're showing no questions in queue at this time I'd like to turn the floor back over for closing comments.

Well. Thank you all for joining US today, we look forward to sharing our progress on our next scheduled conference call.

Have a good day.

Ladies and gentlemen, thank you for your participation in today's conference. You may disconnect. Your lines are log off the webcast and enjoy the rest of your day.

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