Q2 2023 Greenbrook TMS Inc Earnings Call

Welcome to the Greenbrook TMS Inc. Fiscal Year 2023 Q2 Results Conference Call-In Webcast.

All lines are currently on mute to prevent any background noise. I would like to remind you that this conference call is being recorded today and is also being webcast on the companyís website at www.GreenbrookTMS.com under the investor section events. After the speakerís remarks, there will be a question and answer session. Analysts and investors are reminded that any additional questions can be directed to the company at Investor relations at GreenbrookTMS.com. This call contains forward looking statements, which reflect the current expectations of the company.

or beliefs of the company based on currently available information. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the company to differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations are discussed in the Risk Factor section of the company's annual report on Form 20F for the fiscal year ended December 31, 2022. And in the company's other materials filed with the Canadian Securities Regulatory Authorities and the U.S. Securities and Exchange Commission from time to time, which are available on Cedar, Edgar and the company's website. Any forward-looking statement speaks only as of the date on which it is made, and the company disclaims any intent or obligation to update any forward-looking statement unless required by law. I would now like to turn the meeting over to Bill Leonard, President and Chief Executive Officer of Green Book TMS, and Irm's Lobshire Chief Financial Officer. Please go ahead, Mr. Leonard. Thank you, Michelle, and thank you to everyone for joining our conference call and webcast today. During Q2 2023, we continue to focus on the execution of our restructuring plan, and we are very pleased with our progress to date. The company has now effectively stabilized its cost structure with the headcount reduction of 145 employees amounting to a-

to build on the base revenue for a clear path to profitability.

We believe a measured investment in our refined marking strategy will enhance our TMS business and the continued rollout of Spravado program, including the launch of By&Bill. It paints a clear and realistic path of profitability, especially in context of our newly rationalized cost structure. We have also commenced the rollout of a medication management program as an additional revenue stream

and a mechanism to build an internal patient pipeline, which we expect to yield results in the longer run. We've also now strengthened our balance sheet through recent financing transactions with our supportive insiders and lender and expect to see continued access to capital to drive us to self-sufficiency. On the strategic partnership side, we continue to work with Norinetics leadership closely at various levels to implement a mutually beneficial strategy as it relates to enhancing TMS awareness, expanding patient access to care, and effectively redeploying systems for recently closed treatment centers. Additionally, key operators have attended Norrist or University in an effort to leverage a strong education and troning program to better service our patients. Although the cost associated with the restructuring plan have been substantially executed, the full benefit will only reflect in a second half of the year as we expect our new operating structure will continue to allow for rationalized costs while further reducing business complexity.

Streamline our operating model and drive operational efficiencies. We believe that the mental health remains a key focusing United States and the unmet demand for treatment remains at all time high with our network of treatment centers well positioned to serve this unmet demand. We believe our business fundamentals are stronger than ever with the grossest provato program. The opportunity to increase marketing investment in our streamline business, the introduction of management, and the potential future of opportunities, including psychedelics. At the end of Q2 2023, the company had a footprint of 133 treatment centers. As of today, we have 50 treatment centers offering spervato and we expect to have 70 to 8 treatment centers offering spervato by the end of the year through an accelerated rollout plan. And now for a more detailed review of the company's financial and operating performance, I will turn it over to our CFO , Ernst Locher. Thank you, Bol. As Bol mentioned, revenue in Q2 2023 and yet today 2023 increased by 29% to 18.3 million and by 40% to 38.3 million respectively.

rationalization of marketing spend, extinguishing the extinguishment of lease liabilities, and a reduction of other recurring corporate GMA has effectively removed 10 million in annualized cost savings as compared to Q4 2022. That troubles 21 million in annualized cost savings achieved today. CROBLY, direct sensor and regional costs increased by 27% to 18.1 million during Q2 2020, 2023 compared to Q2 2023, but more importantly decreased 18% compared to Q4 2022 due to the reduction in account rationalization of marketing spend and reduction in other direct sense expenses, resulting from execution of the restructuring plan. Furthermore, Q2 2020, 23 other regional and central and central costs decreased 11% compared to Q2 2022 and 50% compared to Q4 2022. Also, evidently, efficiency is gained through our condensed regional footprint.

test, CMS, acquisition. More importantly, we have seen a 14% de-capital we can continue to execute on our restructuring plan with a drug objective to achieve profitability. We remain confidence in our ability to act as capital to move to a self-sustaining business. Now more than ever, we believe we have a concrete, concretely defined pathway to profitability with a stable cost space as both right earlier.

Moving to our core operating metrics, as at the end of Q22023, the total treatment rate is decreased by 8% to 133, from 144 years ago. Compared to Q22022, the number of consultations performed increased by 130% to 9,924, while the number of new patients starts increased by 46% to 2647. And the number of treatments performed increased, by 44% to 174,388. These increases were predominantly due to the completion of the sex-system act, to TMS acquisitions and strong performance in armature reasons, as compared to Q22022. And year to date, as I previously mentioned. And the number of treatments performed increased by 24% to 174,388. These increases were predominantly due to the completion of the sex-system act, to TMS acquisitions and strong performance in armature reasons, as compared to Q22022. And year to date, as I previously mentioned. We believe that devoting more resources and focuss or best performing centers through the results.

need and our leadership position and nationwide footprint continues to serve as a valuable platform to bring the needed help to patients struggling with depression. As always, I would like to take a moment to thank our amazing team. We're extremely proud of them as they continue to deliver the highest levels of care through some recent turbulence. Most importantly, we know that we are making a difference. We have now treated over 38,000 patients with more than 1.2 million treatments performed. We are having significant positive impact on the lives of so many people suffering from mental health disorders. We look forward to keeping you updated on the progress of the company. Thank you for your time today. And with that, Michelle, we will now take questions.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the one on your touchtone phone. You will hear a three-tone prompt acknowledging your request. Should you wish to remove yourself from the queue, please press star two. If you're using a speaker phone, please lift the hands up before pressing any keys. One moment, please, for your first question. I'm also wondering what further savings should we expect to expect in future portals at the center of regional and corporate levels? That's really good question, David. So as it relates to closure of centers, those were substantially complete at the end of Q1. So we don't really see any revenue contribution as it relates to closed centers. There's obviously a lag effect as it relates to the reduction in force. So what we'll see in direct pace to care costs, other regional personnel expenses, as well as called GNA.