Q2 2024 WELL Health Technologies Corp Earnings Call

August 14, 2024

Operator: Welcome to the WELL Health Technologies Corp. 2nd Quarter 2024 Financial Results Conference Call. My name is Inga and I'll be your conference operator today. At this time, participants are in a listen-only mode.

[inaudible]

and many more. Thank you. Thank you.

Ina: Welcome to the WellHealth Technologies Corp's 2nd Quarter 2024 Financial Results Conference Call. My name is Ina and I'll be your conference operator today.

Operator: My name is Inna, and I'll be your conference operator today. At the sum of participants are in a lesson-only mode, we'll conduct a question and answer later in the call, which will be restricted to analysts only.

Operator: We will conduct a question and answer later in the call, which will be restricted to analysts only. Please note that this conference is being recorded. I will now turn the call over to Mr. Tyler Baba, Manager, Investor Relations. Mr. Baba, you may begin.

Ina: At this time all participants are in a listen-only mode. We will conduct a question and answer later in the call, which will be restricted to analysts only. Please note that this conference is being recorded. I'll now turn the call over to Mr. Tyler Baba, Manager, Investor Relations. Mr. Baba, you may begin.

Operator: This note that this conference is being recorded.

Tyler Baba: I'll now turn the call over to Mr. Tyler Baba, Manager, Investor Relations. Mr. Baba, you may begin.

Tyler Baba: Thank you, operator, and welcome everyone to WELL Health's physical second quarter financial results conference call for the three months ended June 30, 2024. Joining me today on the call are Hamed Shahbazi, Chairman and CEO; Eva Fong, the company's CFO. I trust that everyone has received a copy of our financial results press release that was issued earlier today. Please also note that we will be using some slides to assist us in our presentation today. If you are on a webcast, you will automatically see these. If not, you will need to download these from our investor site on our financials page.

Tyler Baba: Thank you, Operator, and welcome, everyone, to WELL Health's fiscal second quarter financial results conference call for the three months ended June 30, 2024. Joining me today on the call are Hamed Shahbazi, Chairman and CEO, Eva Fong, the company's CFO. I trust that everyone has received a copy of our financial results press release that was issued earlier today. Please also note that we will be using some slides to assist us in our presentation today. If you are on a webcast, you will automatically see these.

Speaker Change: Thank you, Operator, and welcome everyone to WellHealth's fiscal second quarter financial results conference call for the three months ended June 30, 2024. Joining me today on the call are Hamed Shahbazi, Chairman and CEO, Eva Fong, the company's CFO.

Tyler Baba: If not, you will need to download these from our investor site on our financials page. Portions of today's call, other than historical performance, include statements of forward-looking information within the meaning of applicable securities laws, including feature-oriented financial information and financial outlook information. These forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors, many of which are outside of WELL's control, that may cause the actual results, performance, or achievements of WELL to differ materially from the anticipated results, performance, or achievements implied by such forward-looking statements.

Tyler Baba: These factors are further, for their outline, in today's press release and in our management discussion, in and out. We provide forward-looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future.

Speaker Change: I trust that everyone has received a copy of our financial results press release that was issued earlier today. Please also note that we will be using some slides to assist us in our presentation today. If you are on a webcast, you will automatically see these. If not, you will need to download these from our investor site on our financials page.

Tyler Baba: Portions of today's call, other than historical performance, include statements of forward-looking information within the meaning of applicable securities laws, including feature-oriented financial information and financial outlook information. These forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors, many of which are outside of WELL's control that may cause the actual results, performance, or achievements of WELL to differ materially from the anticipated results, performance, or achievements implied by such forward-looking statements. These factors are further outlined in today's press release and in our management discussion and analysis. We provide forward-looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future.

Tyler Baba: We do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in our expectations or any change in events, conditions, assumptions, or circumstances on which any such statements are based, except if it is required by law. We may use the terms such as adjusted gross profit, adjusted gross margin, adjusted EBITDA, adjusted EBITDA, or adjusted gross profit, or adjusted EBITDA to reflect any changes, Adjusted Net Income, and Adjusted Free Cash Flow on this conference call, all of which are non-GAAP and non-IFRS. For more information on how we define these terms, please refer to the definitions set out in today's press release and in our MD&A.

Speaker Change: Portions of today's call, other than historical performance, include statements of forward-looking information within the meaning of applicable securities laws, including feature-oriented financial information and financial outlook information.

Speaker Change: These forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors, many of which are outside of wells control, that may cause the actual results, performance, or achievements of well to differ materially from the anticipated results, performance, or achievements implied by such forward-looking statements.

Speaker Change: These factors are further

Speaker Change: Further outlined.

Speaker Change: in today's press release and in our management discussion and analysis.

Speaker Change: We provide forward-looking statements solely for the purpose of providing

Tyler Baba: We do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events, conditions, assumptions, or circumstances on which any such statements are based, except if it is required by law.

Speaker Change: information about management's current expectations and plans relating to the future. We do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events, conditions, assumptions, or circumstances on which any such statements are based.

Tyler Baba: We may use the terms such as adjusted gross profit, adjusted gross margin, adjusted EBITDA, shareholder EBITDA, adjusted net income, and adjusted pre-cash flow on this conference call, all of which are non-GAAP and non-IFRS measures. For more information on how we define these terms, please refer to the definitions set out in today's press release and in our MDNA. The company believes that adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations, which the company can use to fund working capital requirements, service future interest and principal debt repayments, and fund future growth initiatives.

Speaker Change: Accept if it is required by law. We may use the terms such as adjusted gross profit, adjusted gross margin, adjusted EBITDA, shareholder EBITDA.

Speaker Change: Adjusted Net Income and Adjusted Free Cash Flow on this conference call, all of which are non-GAAP and non-IFRS measures. For more information on how we define these terms, please refer to the definition set out in today's press release and in our MD&A.

Tyler Baba: The company believes that adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations, which the company can use to fund working capital requirements, service future interest and principal debt repayments, and fund future growth initiatives. Adjusted EBITDA should not be construed as an alternative to net income or loss determined in accordance with IFRS. And with that, I will turn over the call to Mr. Hamed Shahbazi, Chairman and CEO. Thank you, Tyler, and good day, everyone.

Speaker Change: The company believes that adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations.

Speaker Change: which the company can use to fund working capital requirements, service future interest and principal debt repayments, and fund future growth initiatives. Adjusted EBITDA should not be construed as an alternative to net income or loss determined in accordance with IFRS. And with that, I will turn over the call to Mr. Hamed Shahbazi, Chairman and CEO.

Tyler Baba: Adjusted EBITDA should not be construed as an alternative to net income or loss determined in accordance with IFRS.

Hamed Shahbazi: And with that, I will turn over the call to Mr. Hamachibasi, chairman and CEO.

Hamed Shahbazi: Thank you, Tyler, and good day everyone. We appreciate everyone for joining us today. We're extremely pleased to be with you today and discuss our strong momentum and quarter in which we achieved our 22nd consecutive record-breaking revenue quarter, underscoring the enduring momentum of our company.

Hamed Shahbazi: We appreciate everyone for joining us today. We're extremely pleased to be with you today and discuss our strong momentum and the quarter in which we achieved our 22nd consecutive record-breaking revenue quarter, underscoring the enduring momentum of our company. And for the first time, we'll be using some slides to assist us in our presentation. As Tyler indicated earlier, if you joined via webcast, you should already see these.

Hamed Shahbazi: Thank you, Tyler, and good day, everyone. We appreciate everyone for joining us today.

Hamed Shahbazi: We're extremely pleased to be with you today and discuss our strong momentum

Hamed Shahbazi: and quarter in which we achieved our 22nd consecutive

Hamed Shahbazi: And for the first time, we'll be using some slides to assist us in our presentation. As Tyler indicated earlier, if you joined via webcast, you should already see these. If you don't, you can go to our investor section of our website and either join the webcast or download this. slides. The second quarter of 2024 exceeded all our expectations, showcasing the continued strength and momentum of our technology-driven care delivery platforms. We're very proud to report a robust 42% year-over-year revenue growth, of which half, or approximately 21%, came from organic growth, which includes our clinic absorptions. Note that if you exclude our absorption program, enterprise-wide organic growth would have been 16%.

Speaker Change: and the enduring momentum of our company. And for the first time, we'll be using some slides to assist us in our presentation. It's Tyler indicated earlier. If you joined via webcast, you should already see these if you don't.

Hamed Shahbazi: If you don't, you can go to our investor section of our website and either join the webcast or download the slides. The second quarter of 2024 exceeded all our expectations, showcasing the continued strength and momentum of our technology-driven care delivery platform. We're very proud to report a robust 42% year-over-year revenue growth of which half or approximately 21% came from organic growth, which includes our clinic absorptions. Note that if you exclude our absorption program, enterprise-wide organic growth would have been 16%.

Speaker Change: You can go to our investor section of our website and either join the webcast or download the slides.

Hamed Shahbazi: The company also experienced 11% year-over-year growth in Adjusted Debate. Eva will expand on this later, but we're very pleased to have paid down a significant amount of debt and reduced our leverage ratios in Q2. We're also pleased to have improved annual guidance yet again this quarter. This quarter, we've increased revenue guidance to between $970 million and $990 million for the year.

Speaker Change: The second quarter of 2024 exceeded all our expectations, showcasing the continued strength and momentum of our technology-driven care delivery platforms.

Speaker Change: We're very proud to report a robust 42% year-over-year revenue growth.

Speaker Change: of which there are many.

Speaker Change: Half, or approximately 21%, came from organic growth, which includes our clinic absorptions. Note that if you exclude our absorption program, enterprise-wide organic growth would have been 16%.

Hamed Shahbazi: The company also experienced 11% year-over-year growth in adjusted EBITDA. You will expand on this later, but we're very pleased to have paid down a significant amount of debt and reduced our leverage ratios in Q2. We're also pleased to have improved annual guidance yet again this quarter. This quarter we've increased revenue guidance to between 970 million and 990 million for the year. It should be noted that, for the purposes of assessing 2024 annual organic growth, we estimate that our 2023 performer revenue would have been approximately 849 million if all of our 2023 acquisitions, excluding clinic absorptions, had occurred on January 1, 2023, and excluding all but one month of IntraHealth, which was sold on February 1, 2024.

Speaker Change: The company also experienced 11% year-over-year growth in adjusted EBITDA.

Speaker Change: You will expand on this later, but we're very pleased to have paid down a significant amount.

Speaker Change: of Debt and Reduced Our Leverage Ratios in Q2.

Speaker Change: We're also pleased to have improved annual guidance yet again this quarter.

Speaker Change: This quarter we've increased revenue guidance to between $970 million and $990 million for the year.

Hamed Shahbazi: It should be noted that for the purposes of assessing 2024 annual organic growth, we estimate that our 2023 PERFORMA revenue would have been approximately $849 million if all of our 2023 acquisitions, excluding clinic absorptions, had occurred on January 1, 2023, and excluding all but one month of IntraHealth, which was sold on February 1, 2024. Note that this number differs from what was disclosed in the notes to our 2023 audited financial statements, as that PERFORMA number included clinic absorptions, IntraHealth, and a number of other adjustments. As such, the midpoint of our updated guidance infers an organic growth rate, including absorptions of 15.4% for the year.

Speaker Change: It should be noted that for the purposes of assessing

Speaker Change: 2024 annual organic growth, we estimate that our 2023 PERFORMA revenue would have been approximately $849 million if all of our 2023 acquisitions, excluding clinic absorptions, had occurred on January 1st, 2023, and excluding all but one month of IntraHealth, which was sold on February 1st, 2024.

Hamed Shahbazi: Note that this number differs from what was disclosed in the notes to our 2023 audited financial statements. Is that performer number included clinic absorptions, IntraHealth, and a number of other adjustments? As such, the midpoint of our updated guidance infers an organic growth rate, including absorptions, of 15.4% for the year. As for just a deeper doubt, we're maintaining our previous guidance, which was just increased last quarter to the upper range of 125 million to 130 million, despite incurring higher costs due to our projection of significantly lower their issuance and stock base incentives. We also reiterate our guidance introduced last quarter for free, cash available to shareholders to be approximately 55 million dollars for the year.

Speaker Change: Note that this number differs from what was disclosed in the notes to our 2023 Audited Financial Statements, as that PERFORMA number included clinic absorptions, intra-health, and a number of other adjustments.

Speaker Change: As such, the midpoint of our updated guidance infers an organic growth rate including absorptions of 15.4% for the year.

Hamed Shahbazi: As for just a deeper doubt, we're maintaining our previous guidance, which was just increased last quarter to the upper range of 125 million to 130 million, despite incurring higher costs due to our projection of significantly lower their issuance and stock-based incentives. We also reiterate our guidance introduced last quarter for free cash available to shareholders to be approximately 55 million dollars for the year.

Speaker Change: As for adjusted EBITDA, we're maintaining our previous guidance, which was just increased last quarter to the upper range of $125 million to $130 million, despite incurring higher costs due to our projection of significantly lower share issuance and stock-based incentives.

Speaker Change: We also reiterate our guidance introduced last quarter for free cash flow available to shareholders to be approximately $55 million for the year.

Hamed Shahbazi: Keep in mind that this target guidance does not include any unannounced acquisitions. If we include any material acquisitions, there's a fairly good chance that we would be ahead of our current guidance range, notwithstanding any potential material divestments. Our pipeline of acquisitions continues to be strong, particularly in our Canadian clinics division where we have significant opportunities for acquisition or absorption of clinics. In addition, keep in mind that the second half of the year is typically stronger for us in terms of EBITDA generation, and we continue to maintain guidance from improving free cash flow, attributable to shareholders, to approximately 55 million dollars, representing a 30% year-over-year increase from 2023.

Hamed Shahbazi: If we include any material acquisitions, there's a fairly good chance that we would be ahead of our current guidance range, notwithstanding any potential material divestment. Pipeline of acquisitions continues to be strong, particularly in our Canadian Clinics Division, where we have significant opportunities for acquisition or absorption of clinics. In addition, keep in mind that the second half of the year is typically stronger for us in terms of EBITDA generation and we continue to maintain guidance from improving free cash flow, attributable to shareholders to approximately $55 million, representing a 30% year-over-year increase from 2023.

Speaker Change: Keep in mind that this target guidance does not include any unannounced acquisitions. If we include any material acquisitions, there's a fairly good chance that we would be ahead of our current guidance range, notwithstanding any potential material divestments.

Speaker Change: Our pipeline of acquisitions continues to be strong, particularly in our Canadian Clinics Division, where we have significant opportunities for acquisition or absorption of clinics.

Speaker Change: In addition, keep in mind that the second half of the year is typically stronger for us in terms of EBITDA generation and we continue to maintain guidance for improving free cash flow attributable to shareholders to approximately $55 million, representing a 30% year-over-year increase from 2023.

Hamed Shahbazi: Moving on to operational highlights, central to our identity is our commitment to providing competent, reliable, and tech-enabled support to health care providers. As of the end of Q2 2024, over 3,900 providers and clinicians deliver care across our physical and virtual clinics. Of that number, I'm proud to announce that we've achieved approximately 1,000 physicians serving patients within our well clinics in Canada. Remember that there are likely less than 100,000 physicians in the entire country serving our $330 billion health care ecosystem, so we can proudly state that approximately 1% of all health care providers or physicians make a well-clinic their place of practice.

Hamed Shahbazi: Moving on to operational highlights, central to our identity is our commitment to providing competent, reliable, and tech-enabled support to healthcare. As of the end of Q2 2024, over 3,900 providers and clinicians delivered care across our physical and virtual clinics. Of that number, I'm proud to announce that we've achieved approximately 1,000 physicians serving patients within our WELL clinics in Canada. Remember that there are likely less than 100,000 physicians in the entire country serving our $330 billion healthcare ecosystem. So we can proudly state that approximately 1% of all healthcare providers or physicians make a WELL clinic their place of practice. Truly a remarkable milestone.

Speaker Change: Moving on to operational highlights. Central to our identity is our commitment to providing competent, reliable, and tech-enabled support to health care providers.

Speaker Change: As of the end of Q2 2024, over 3,900 providers and clinicians delivered care across our physical and virtual clinics.

Speaker Change: Of that number, I'm proud to announce that we've achieved

Speaker Change: approximately 1,000 physicians serving patients within our WELL clinics in Canada. Remember that there are likely less than 100,000 physicians in the entire country.

Speaker Change: serving our $330 billion healthcare ecosystem. So we can proudly state that approximately 1% of all healthcare providers or physicians make a WELL clinic their place of practice. Truly a remarkable milestone.

Hamed Shahbazi: Truly a remarkable mouse. Stone. In addition, there are more than 37,000 providers benefiting from our SaaS and technology services, with just approaching approximately 40% of all physicians and candidates supported by our platform in some way. Well, it's given a record 1.4 million patient visits in Q2, an increase of 38% has compared to Q2 of 2023, representing 5.6 million patient visits on an annualized run rate basis. Patient visits were comprised of 759,000 patient visits in Canada and 640,000 patient visits in the United States. Canadian patient services visits increased 41% while US patient visits increased 34% on a year-over-year basis.

Hamed Shahbazi: In addition, there are more than 37,000 providers benefiting from our SAS and technology services, which is approaching approximately 40% of all physicians in Canada supported by our platform. Well, it's given a record 1.4 million patient visits in Q2, an increase of 38 percent as compared to Q2 of 2023, representing 5.6 million patient visits on an annualized run rate basis. Patient visits were comprised of 759,000 patient visits in Canada and 640,000 patient visits in the United States.

Speaker Change: In addition, there are more than 37,000 providers benefiting from our SAS and technology services, which is approaching approximately 40% of all physicians in Canada supported by our platform in some way.

Speaker Change: well achieved a record 1.4 million patient visits in Q2 an increase of 38% as compared to Q2 of 2023 representing 5.6 million patient visits on an annualized run rate basis

Speaker Change: Patient visits were comprised of 759,000 patient visits in Canada and 640,000 patient visits in the United States. Canadian patient services visits increased 41% while U.S. patient visits increased 34% on a year-over-year basis.

Hamed Shahbazi: Canadian Patient Services Visits increased 41% while US Patient Visits increased 34% on a year, I'd like to point out that organic growth in patient visits, including absorptions in Canada, was 25.5%. If you strip out absorptions, same clinic growth in visits was 11.4%, which one must remember is much higher, and we would guess guess to be about triple- The Growth Rate of Traditional Organic Growth Figures in terms of Canadian health care, which are typically in the 3-4% range. I would like to now move on to describing some of the key themes for today's call.

Hamed Shahbazi: I'd like to point out that organic growth in patient visits, including absorption in Canada, was 25.5%. If you strip out absorptions, same clinic growth in visits was 11.4%, which one must remember is much higher and we would guess to be about triple the growth rate of traditional organic growth figures in terms of Canadian healthcare, which are typically in the 3-4% range.

Speaker Change: I'd like to point out that organic growth in patient visits, including absorptions in Canada, was 25.5%. If you strip out absorptions, same clinic growth in visits was 11.4%.

Speaker Change: Which, one must remember, is much higher, and we would guess to be about triple the growth rate of traditional organic growth figures in terms of Canadian health care.

Hamed Shahbazi: I would like to now move on to describing some of the key themes for today's call. One, our very strategies to unlock some of parts value. Two, our plans to spin out our SaaS and services provider solutions line of business as a control public company. And three, our efforts to prove per share metrics by reducing dilution and stock-based compensation, improving profitability, and improving shareholder value. And four, we will also be making some important commentary about our clinic consolidation program and the progress we've been experiencing there, too. On to unlocking some of the parts. This is something that we covered off at Investor Day, but we'd like to revisit a bit today.

Speaker Change: which are typically in the three to four percent range.

Speaker Change: I would like to now move on to describing some of the key themes for today's call.

Hamed Shahbazi: One, our various strategies to unlock some of PARCC's value. Two, our plans to spin out our SaaS and services provider solutions line of business as a controlled public company. And three, our efforts to improve per-share metrics by reducing dilution and stock-based compensation, improving profitability, and improving shareholder value. And four, we will also be making some important commentary about our clinic consolidation program and the progress we've been experiencing there, too. On to unlocking some of the parts.

Speaker Change: [inaudible]

Speaker Change: our various strategies to unlock Sum of Parts value. Two, our plans to spin out our SaaS and services provider solutions line of business as a controlled public company.

Speaker Change: And three, our efforts to improve per-share metrics by reducing dilution and stock-based compensation, improving profitability, and improving shareholder value.

Speaker Change: And four, we will also be making some important commentary about our clinic consolidation program and the progress we've been experiencing there too.

Hamed Shahbazi: This is something that we covered off at Investor Day, but we'd like to revisit a bit today. WELL is a diverse and multifaceted healthcare technology company with multiple business lines operating across both the US and Canadian Mark. While it's natural for there to be a small discount to the multiple holdings of a conglomerate such as WELL, we believe that the discount currently associated with WELL far exceeds a normal conglomerate or holding company discount.

Speaker Change: On to unlocking some of the parts.

Speaker Change: This is something that we covered off at Investor Day, but we'd like to revisit a bit today.

Hamed Shahbazi: Well, it's a diverse and multifaceted healthcare technology company with multiple business lines operating across both the US and Canadian markets. Well, it's natural for there to be a small discount to the multiple holdings of a conglomerate such as well. We believe that the discount currently associated with wealth far exceeds a normal conglomerate or holding company discount. And we believe this is an opportunity for those investors who are looking for hidden but realizable value. While some of that discount has been corrected since our investor day, we believe that there's still an approximately an 800 million to $1 billion discount to our true sum of parts.

Speaker Change: Well is a diverse and multifaceted healthcare technology company with multiple business lines operating across both the US and Canadian markets.

Speaker Change: While it's natural for there to be a small discount to the multiple holdings of a conglomerate such as WELL, we believe that the discount currently associated with WELL far exceeds a normal conglomerate or holding company discount.

Hamed Shahbazi: We believe this is an opportunity for those investors who are looking for hidden but realizable value. While some of that discount has been corrected since our investor day, we believe that there's still an approximately an $800 million to $1 billion discount to our true sum of parts. As you'll see in today's presentation, these overlooked segments are not only strong performance, but they're also experiencing significant growth and momentum. Therefore, we propose a sum-of-parts valuation approach to more accurately assess the cost.

Speaker Change: And we believe this is an opportunity for those investors who are looking for hidden but realizable value.

Speaker Change: While some of that discount has been corrected since our Investor Day, we believe that there's still an approximately $800 million to $1 billion discount to our true sum of parts.

Hamed Shahbazi: As you'll see in today's presentation, these overlooked segments are not only strong performance, but they're also experiencing significant growth and momentum. Therefore, we propose a sum-of-parts valuation approach to more accurately assess the company's worth. We believe that unlocking the value of some of our assets through third-party arms-length investments or divestments could go a long way to highlight this value. In the case where divestments occur, such cash benefits could be material and could be likely used to pay down debt or to issue a special buyback or make additional accretive acquisition. Last quarter, we indicated that we had begun considering strategic alternatives for our US patient, digital patient services businesses, Circle Medical and Waste.

Speaker Change: As you'll see in today's presentation, these overlooked segments are not only strong performance, but they're also experiencing significant growth and momentum. Therefore, we propose a sum-of-parts valuation approach to more accurately assess the company's worth.

Hamed Shahbazi: We believe that unlocking the value of some of our assets, Ventures, third party arm's length investments or divestments could go a long way to highlight this value. In the case where divestments occur, such cash benefits could be material and could be likely used to pay down debt or to issue a special buyback or make additional accretive acquisition. Last quarter, we indicated that we had begun considering strategic alternatives for our U.S. patient digital patient services businesses, Circle Medical and WIC. We do not believe that the capital markets are signing a fair value for these two assets as part of, well, given their high growth and improving fundamentals.

Speaker Change: We believe that unlocking the value of some of our assets

Speaker Change: Your third-party arm's-length investments or divestments could go a long way to highlight this value.

Speaker Change: In the case where divestments occur, such cash benefits could be material and could be likely used to pay down debt, or to issue a special buyback, or make additional accretive acquisitions.

Speaker Change: Last quarter we indicated that we had begun considering strategic alternatives for our US patient digital patient services businesses Circle Medical and WISC.

Hamed Shahbazi: We do not believe that the capital markets are assigning a fair value for these two assets as part of, well, given their high growth and improving fundamentals. Both Circle and Waste are higher growth businesses that would essentially be valued generally on a price to sales basis, given their limited but improving EBITDA generation, whereas WELL is primarily valued on a price to EBITDA basis, which creates a dislocation in value that results in unrealized or hidden sum of parts value. In addition, WELL has a call option for both these businesses, which provides us with several alternatives, including acquiring the remaining ownership of the businesses, speaking in IPO or RTO, or selling the businesses entirely.

Speaker Change: We do not believe that the capital markets are assigning a fair value for these two assets as part of, well, given their high growth and improving fundamentals.

Hamed Shahbazi: Both Cercone Whisp are higher growth businesses that would essentially be valued generally on a price to sales basis, given their limited but improving EBITDA generation, whereas well as primarily valued on a price to EBITDA basis, which creates a dislocation and value which results in unrealized or hidden some of parts value. In addition, WELL has a call option for both these businesses, which provides us with several alternatives, including acquiring the remaining ownership of the businesses, seeking an IPO or RTO, or selling the businesses entirely.

Speaker Change: Both Circle and Wisp are higher growth businesses that would essentially be valued generally on a price-to-sales basis, given their limited but improving EBITDA generation, whereas Well is primarily valued on a price-to-EBITDA basis.

Speaker Change: which creates a dislocation in value which results in unrealized or hidden sum of parts value.

Speaker Change: In addition, WELL has a call option for both these businesses, which provides us with several alternatives including acquiring the remaining ownership of the businesses, seeking an IPO.

Hamed Shahbazi: We have hired professional advisors to help us with these processes. In the case of Circle Medical, the call option has a timeline which has now been extended with the approval of the minority shareholders well into 2025. We are pleased to announce that Circle Medical has retained JP Morgan to evaluate strategic alternatives and help identify a partner or partners that will support Circle in its next phase of growth. On the west side of things, we're similarly pleased to report the CIBC Capital Markets is assisting us with our evaluation of strategic alternatives. We will provide updates as they become available on both of these processes that do not expect updates until later this year, or especially in the case of Circle Medical early next year.

Hamed Shahbazi: We have hired professional advisors to help us with these processes. In the case of circle medical, the call option has a timeline which has now been extended with the approval of the minority shareholders well into 2020. We are pleased to announce that Circle Medical has retained J.P. Morgan to evaluate strategic alternatives and help identify a partner or partners that will support Circle in its next phase of growth.

Speaker Change: or RTO, or selling the businesses entirely. We have hired professional advisors to help us with these processes. In the case of Circle Medical, the call option has a timeline which is now being extended with the approval of the minority shareholders well into 2025.

Speaker Change: We are pleased to announce that Circle Medical has retained J.P. Morgan to evaluate strategic alternatives and help identify a partner or partners that will support Circle in its next phase of growth.

Hamed Shahbazi: On the wind side of things, we're similarly pleased to report that CIBC Capital Markets is assisting us with our evaluation of strategic alternatives. We will provide updates as they become available on both of these processes, but do not expect updates until later this year, or especially in the case of surgical medical early next year. In addition to evaluating strategic alternatives for CIRCLE and WISP, we started to look at additional opportunities for unlocking value.

Speaker Change: On the WIS side of things, we're similarly pleased to report that CIBC Capital Markets is assisting us with our evaluation of strategic alternatives.

Speaker Change: We will provide updates as they become available on both of these processes, but do not expect updates until later this year, or especially in the case of surgical medical, early next year.

Hamed Shahbazi: In addition to evaluating strategic alternatives for Circle and West, we started to look at additional opportunities for unlocking value, and we're very pleased to disclose that we are working on another important initiative that we believe will yield significant shareholder value. And that's related to our Platform Solutions business. We believe our SaaS and services provider solutions business is a very strong candidate as a potential spin-out as a well-controlled standalone public company. Excluding cybersecurity, our provider solutions group achieved external revenue of $10.4 million in Q2 2024 with 86% gross margins, 30% EBITDA margins, and 24% organic growth, with over 90% of its revenues contractual and recurring in nature.

Speaker Change: In addition to evaluating strategic alternatives for CIRCLE and WISP, we started to look at additional opportunities for unlocking value. And we're very pleased to disclose that we are working on another important initiative that we believe will yield significant shareholder value.

Hamed Shahbazi: And we're very pleased to disclose that we are working on another important initiative that we believe will yield significant shareholder value. That's and that's related to our platform solutions business. We believe our SaaS and services provider solutions business is a very strong candidate as a potential spin out as a well-controlled standalone public company, excluding cyber security, our provider solutions group, and achieved external revenue of $10.4 million in Q2 2024, with 86% gross margins, 30% EBITDA margins, and 24% organic growth with over 90% of its revenues contractual and recurring in nature.

Speaker Change: and that's related to our platform solutions business.

Speaker Change: We believe our SaaS and services provider solutions business is a very strong candidate as a potential spin-out as a well-controlled standalone public company.

Speaker Change: Excluding cyber security, our provider solutions group

Speaker Change: achieved external revenue of $10.4 million in Q2 2024 with 86% gross margins, 30% EBITDA margins, and 24% organic growth with over 90% of its revenues contractual and recurring in nature.

Hamed Shahbazi: This is a very healthy and profitable staff business with great growth prices. We believe Provider Solutions Group would be valued at a much higher valuation multiple than the value that is currently being afforded to WELL Health. In addition, we believe we could accelerate the growth of this business as a standalone public company, which would then ramp up its own capital allocation program to ensure it is growing methodically, both organically and inorganically. The Provider Solutions Group is an integral part of the Canadian clinic's ecosystem that tech enables doctors and other health care providers in our clinics.

Hamed Shahbazi: This is a very healthy and profitable SaaS business with great growth prospects. We believe Provider Solutions Group would be valued at a much higher valuation multiple than the value that is currently being afforded to Well-held. In addition, we believe we could accelerate the growth of this business as a standalone public company, which would then ramp up its own capital allocation program to ensure it is growing methodically, both organically and inorganically. The provider solutions group is an integral part of the Canadian clinics ecosystem that tech-enabled doctors and other healthcare providers in our clinics. It's also an area where we have clear market leadership to support healthcare providers nationally.

Speaker Change: This is a very healthy and profitable SaaS business with great growth prospects.

Speaker Change: We believe Provider Solutions Group would be valued at a much higher valuation multiple than the value that is currently being afforded to WellHealth.

Speaker Change: In addition, we believe we could accelerate the growth of this business as a standalone public company, which would then ramp up its own capital allocation program to ensure it is growing methodically, both organically and inorganically.

Speaker Change: The Provider Solutions Group is an integral part of the Canadian clinics ecosystem that tech enables doctors and other health care providers in our clinics. It's also an area where we have clear market leadership to support health care providers nationally.

Hamed Shahbazi: It's also an area where we have clear market leadership to support health care providers nationally, where our market share ownership in EMR in Canada is third. If you look at the full platform requirements of a health care provider, which include billing management, productivity apps, and other elements, to our knowledge, there is no bigger market share owner in the country than WELL's provider solutions entity. Even after a prospective spin out of our provider solutions group, this group will continue to work closely with and support our clinics and clinic transformation team, as well as intentions are to maintain a strong economic and voting majority in this entity, even after it's spun out as a separate publicly listed entity.

Hamed Shahbazi: Where a market share ownership in EMR in Canada is third, if you look at the full platform requirements of a healthcare provider, which include billing management, productivity app, and other elements, to our knowledge there is no bigger market share owner in the country than Well-Provider Solutions and to-University. Even after a prospective spin-out of our Provider Solutions group, this group will continue to work closely with and support our clinics and Clinic Transformation team. As such, well as intentions are to maintain a strong economic and voting majority in the entity, even after it spun out as a separate publicly listed company.

Speaker Change: where our market share ownership in EMR in Canada is third. If you look at the full platform requirements of a health care provider, which include billing management, productivity app, and other elements,

Speaker Change: To our knowledge, there is no bigger market share owner in the country than Wells Provider Solutions Entity.

Speaker Change: Even after a prospective spin-out of our Provider Solutions Group,

Speaker Change: This group will continue to work closely with and support our clinics and clinic transformation team. As such, WELL's intentions are to maintain a strong economic and voting majority in this entity, even after it's spun out as a separate publicly listed company.

Hamed Shahbazi: As such, there should be no real changes to how this entity operates and interacts with our own clinics, which is very important to our own development within our WELL Clinics ecosystem. We're very excited about this initiative and we'll provide more updates in the coming weeks and months. The third key theme is one of the most important for the call today, our commitment to delivering improved shareholder value.

Speaker Change: As such, there should be no real changes to how this entity operates and interacts with our own clinics, which is very important to our own development within our Well Clinics ecosystem.

Hamed Shahbazi: We're very excited about this initiative, and we'll provide more updates in the coming weeks and months.

Speaker Change: We're very excited about this initiative and we'll provide more updates in the coming weeks and months.

Hamed Shahbazi: The third key theme is one of the most important for the call today: our commitment to delivering improved shareholder value. Last quarter, in our conference call, we talked about an important inflection point, where WELL was going to focus more intently on optimizing our profit per share metrics by not only improving our overall organic growth and profitability, but also paying brick and significant attention to our dilution and pulling all the levers we could to reduce and eventually fully eliminate and then reverse dilution. I'm pleased to note that this quarter we made excellent progress towards these stated goals, and as Eva will demonstrate later, we were able to actually reduce our fully diluted share totals during the quarter slightly by paying out all of our earnouts and cash, not issuing any new incentive fair awards, and actually electing to pay some of our incentives in cash, which our long term incentive plans allows for, and buying back some stock.

Speaker Change: The third key theme is one of the most important for the call today, our commitment to delivering improved shareholder value. Last quarter in our conference call we talked about an important inflection point.

Hamed Shahbazi: Last quarter in our conference call we talked about an important inflection [inaudible] where WELL was going to focus more intently on optimizing our profit per share metrics by not only improving our overall organic growth and profitability, but also paying significant attention to our dilution and pulling all the levers we could to reduce and eventually fully eliminate and then reverse dilution. I'm pleased to note that this quarter we made excellent progress towards these stated goals, and as Eva will demonstrate later, we were able to actually reduce our fully diluted share totals during the quarter slightly by paying out all of our earnouts in cash, not issuing any new incentive share awards, and actually in electing to pay some of our incentives in, which our long-term incentive plans allows for, and buying back some.., we will be applying the same intensity to managing dilution, driving organic growth, and improving our profitability in subsequent quarters as we work hard to realize sum of parts value and significantly elevate shareholder value.

Speaker Change: where WELL was going to focus more intently on optimizing our profit per share metrics by not only improving our overall organic growth and profitability but also paying quick

Speaker Change: and significant attention to our dilution and pulling all the levers we could to reduce and eventually fully eliminate and then reverse dilution.

Speaker Change: I'm pleased to note that this quarter we made excellent progress towards these stated goals.

Speaker Change: And as Eva will demonstrate later, we were able to actually reduce our fully diluted share totals during the quarter slightly by paying out all of our earnouts in cash, not issuing any new incentive fair awards.

Speaker Change: and actually in electing to pay some of our incentives in cash.

Hamed Shahbazi: We will be applying the same intensity to managing dilution, driving organic growth, and improving our profitability in subsequent quarters as we work hard to realize some of the parts value and significantly elevate shareholder value.

Speaker Change: which our long-term incentive plans allows for and buying back some stock.

Speaker Change: We will be applying the same intensity to managing dilution, driving organic growth, and improving our profitability in subsequent quarters as we work hard to realize sum of parts value and significantly elevate shareholder value.

Eva Fong: With that, I'd now like to turn the call over to our CFO, Eva Phong, who will provide some financial context and color on some of the most important themes of unlocking shareholder value.

Hamed Shahbazi: With that, I'd now like to turn the call over to our CFO, Eva Fong, who will provide some financial context and color on some of the most important themes of unlocking shareholder value. And then we'll come back and provide some further commentary on our lines of business.

Speaker Change: With that, I'd now like to turn the call over to our CFO, Eva Fong, who will provide some financial context and color on some of the most important themes of unlocking shareholder value. I'll then come back and provide some further commentary on our lines of business.

Eva Fong: I'll then come back and provide some further commentary on our lines of business.

Eva Fong: Eva. Thank you, Eva. I'm pleased to report that we have very strong results for the three months and the June 30th, 2024. Our revenue grew by 42% to 243.1 million, and I'll adjust the EBDA group by 11% to 30.9 million. Our overall second quarter results were very positive.

Eva Fong: I'm pleased to report that we have very strong results for the three months ended June 30th, 2024. Our revenue grew by 42% to $243.1 million and our adjusted EBITDA grew by 11% to $30.9 million. Our overall second quarter results were very positive.

Speaker Change: Eva

Eva Fong: Thank you, Hamed. I'm pleased to report that we have very strong results for the three months ended June 30, 2024. Our revenue grew by 42% to $243.1 million and our adjusted EBITDA grew by 11% to $30.9 million.

Eva Fong: I won't go into too much of the financial details as they are available on Cedar Plus, but instead, I'll go through other key financial metrics in the next few slides. Wallachite Records I's net income of $170 million in Q2, 2024, compared to a lot of $2 million in Q2, 2023. This increase in net income was largely driven by significant and real-life gains of well-investment in here while AI. Our net income be remained positive, even if we exclude and realize gains from our investments in here while, which shows the progress we are making overall. Now setting this, we think that what is more important than a share price gains here while has made this year is incredible improvement.

Eva Fong: I won't go into too much of the financial details as they are available on CESA+. But instead, I'll go through other key financial metrics in the next few slides. Wallachite's record eyes are a net income of $170 million in Q2 2024 compared to a lot of $2 million in Q2 2023.

Speaker Change: Our overall second quarter results were very positive. I won't go into too much of the financial details as they are available on SETA+, but instead I will go through other key financial metrics in the next few slides.

Speaker Change: Thank you.

Speaker Change: Wallachie's record IFRS net income of $117 million in Q2 2024 compared to a loss of $2 million in Q2 2023. This increase in net income was largely driven by significant unrealized gains of wealth investment in HealWell AI.

Speaker Change: Our net income remains positive, even if we exclude and realize gains from our investments in Q1, which shows the progress we are making overall.

Eva Fong: This increase in net income was largely driven by significant and real-life gains of world investment in QWAL AI. Our net income be remained positive even if we exclude and realize gains from our investments in Cuba, which shows the progress we are making overall. Now, setting this, we think that what is more important than a share price game, here WELL has made this year, is incredible improvement. It has made in terms of its business, its execution and fundamentals. If your most current run rate revenue is already surpassing 65 million and is projected to be approaching 100 million by the end of the year on a run rate base.

Speaker Change: Notwithstanding this, we think that what is more important than the share price gains Hayward has made this year is the incredible improvement it has made in terms of its business execution and fundamentals.

Eva Fong: It has made in terms of its business, its execution, and fundamentals. Here, Wall's current run rate revenue is already surpassing 65 million and is projected to be approaching 100 million by the end of the year on a run rate basis. Hewar has also given guidance for reaching probability in 2025. This is pretty incredible, for a company that has less than 10 million in revenues just 10 months ago.

Speaker Change: Hillel's current run rate revenue is already surpassing $65 million and is projected to be approaching $100 million by the end of the year on a run rate basis.

Eva Fong: Hewar has also given guidance for reaching profitability in 2025. This is pretty incredible for a company that has less than 10 million in revenues just 10 months ago. At a time when we may be approaching a period of recession and deflation, it is important to note that HealWell is a technology company that is serving the life sciences sector with very steady, resilient, and defensive revenue streams. This includes doctors, clinicians, and hospitals for its co-pilot products and the pharmaceutical industry with its real-world evidence, scientific research, and clinical trials orchestration services.

Speaker Change: Kewa has also given guidance for reaching profitability in 2025. This is pretty incredible for a company that has less than 10 million in revenues just 10 months ago.

Eva Fong: At a time when we may be approaching a period of recession and deflation, it is important to note that Hewar is a technology company that is serving the life sciences sector with very steady, resilient, and defensive revenue streams. This includes doctors, clinicians, and hospitals for its co-pilot products and the pharmaceutical industry with its real-world evidence, scientific research, and clinical trials, orchestration services. We expect to exercise our call options within the next few quarters, which will further increase wealth, economics, and voting interest in the company and will end our period of immersion of the unrealized gains on our books.

Speaker Change: At a time when we may be approaching a period of recession and deflation, it is important to note that HealWell is a technology company that is serving the life sciences sector with very steady, resilient and defensive revenue streams.

Speaker Change: This includes doctors, clinicians, and hospitals for its co-pilot products and the pharmaceutical industry with its real-world evidence, scientific research, and clinical trials orchestration services.

Eva Fong: We expect to exercise our call option within the next few quarters, which will further increase WELL's economic and voting interest in the company and will end our period of measuring out the unrealized gains on our book. As for the adjusted net income, which adjusts our all unrealized gains such as the HealWellShare gains recorded in our IFRS net income, it is important to note that we are making progress. I'd like to point out that last year in Q2 2023, we recorded adjusted net income of $14.4 million.

Inna: My name is Inna and I'll be your conference operator today. At the sum of participants are in a lesson only mode, we'll conduct a question and answer later in the call, which will be restricted to analysts only.

Speaker Change: We expect to exercise our call option within the next few quarters which will further increase wealth, economic and voting interest in the company and will end our period of measuring out the unrealized gains on our books.

Eva Fong: I thought he adjusted that income, which adjusts our all unrealized gains such as the Hewar share gains recorded in our IFR's net income. It is important to note that we are making progress. I would like to point out that last year in Q2 2023, we recorded adjusted that income of 14.4 million. However, this includes a one-time real-life benefit of 3.5 million worth of income associated with the termination of a management contract by one of the data. The investment partners of CLH. See, whenever CLH sells and it is an assistive asset, they typically retain a management contract that provides ongoing management fees.

Inna: This note that this conference is being recorded.

Tyler Baba: I'll now turn the call over to Mr. Tyler Baba, Manager Investor Relations, Mr. Baba, you may begin. Thank you operator and welcome everyone to WELL Health's physical second quarter financial results conference call for the three months ended June 30, 2024. Joining me today on the call are Hamed Shahbazi, Chairman and CEO, Eva Fong, the company's CFO. I trust that everyone has received a copy of our financial results press release that was issued earlier today.

Speaker Change: I've already adjusted net income which adjusts our all unrealized gains such as the year-round share gains recorded in our IFRS net income. It is important to note that we are making progress.

Speaker Change: I'd like to point out that last year in Q2 2023, we recorded adjusted net income of $14.4 million. However, this included a one-time realized benefit of $3.5 million worth of income associated with the termination of a management contract by one of the divestment partners of CLH.

Eva Fong: However, this included a one-time realized benefit of $3.5 million worth of income associated with the termination of a management contract by one of the divestment partners of CLH. See, whenever CLH sells an anesthesiologist asset, they typically retain a management contract that provides ongoing management fees. If such a contract is terminated, it accelerates the management fees' owing.

Tyler Baba: Please also note that we will be using some slides to assist us in our presentation today. If you are on a webcast, you will automatically see these. If not, you will need to download these from our investor site on our financials page.

Speaker Change: You see, whenever CLH sells an anaesthetist asset, they typically retain a management contract that provides ongoing management fees. If such a contract is terminated, it accelerates the management fees owing.

Eva Fong: If such a contract is terminated, it accelerates the management fees only. If one were to normalize for this one-time income last year, we would see a 13% year-over-year increase to this year's adjusted net income of 12.3 million. As I pointed out earlier by Hammond, well, he is extremely focused on his per share performance metrics. It has had significant success with his revenue per share going from 16 cents per share in Q1 2021 to over $1 share per share as of Q2 2024. But we have much more focus on our adjusted FBDA and adjusted shareholder FBDA, which removes the non-controlled interest, as well as free cash flow available to shareholders, which we consider to be the most important metric to track as a capital allocator.

Eva Fong: If one were to normalize for this one-time income last year, we would see a 13% year-over-year increase to this year's adjustment net income of 12.3 million. As pointed out earlier by Hamed, WELL is extremely focused on its per share performance metrics. It has had significant success with its revenue per share going from $0.16 per share in Q1 2021 to over $1 per share as of Q2 2024. But we're much more focused on our adjusted EBITDA and adjusted shareholder EBITDA, which removes the non-controlled interest, as well as free cash flow available to shareholders, which we consider to be the most important metric to track as a capital allocator, well achieved free cash flow to shareholders of 8.7 million in K2 2024.

Speaker Change: If one were to normalize for this one-time income last year, we would see a 13% year-over-year increase to this year's adjusted net income of $12.3 million.

Speaker Change: As pointed out earlier by Hamed, WOW is extremely focused on its per share performance metrics.

Speaker Change: It has had significant success with its revenue per share going from $0.16 per share in Q1 2021 to over $1 per share as of Q2 2024.

Tyler Baba: These factors are further outlined in today's press release and in our management discussion and analysis. We provide forward-looking statements solely for the purpose of providing information about management's current expectations and plans relating to the future. We do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events, conditions, assumptions, or circumstances on which any such statements are based, except if it is required by law.

Speaker Change: But we're much more focused on our adjusted EBITDA and adjusted shareholder EBITDA, which removes the non-controlled interest, as well as free cash flow available to shareholders, which we consider to be the most important metric to track as a capital allocator.

Eva Fong: Well achieved free cash flow to shareholders of 8.7 million in Q2 2024. You'll notice that this shows a sequential decline compared to Q1 2024. This is mainly due to the fact that in Q2, we make 50% of our interest payments for the year for our convertible debentures in the amount of $1.9 million. Also, we were expecting to receive $2.3 million in tax credits in Q2, which were late and actually arrived just a few days ago here in Q3. It is important to note that our Q2 2024 would have been closer to $11 million with these credits added, which would have been a 17% year-over-year increase.

Speaker Change: WELL achieved free cash flow to shareholders of $8.7 million in Q2 2024.

Eva Fong: You'll notice that the shows of sequential decline compared to K1 2024. This is mainly due to the fact that in K2, we make 50% of our interest payments for the year for our convertible debentures in the amount of $1.9 million dollars. Also, we were expecting to receive $2.3 million in tax credits in Q2, which were late and actually arrived just a few days ago here in Q3.

Speaker Change: You'll notice that this shows a sequential decline compared to Q1 2024. This is mainly due to the fact that in Q2, we make 50% of our interest payments for the year for our convertible debentures in the amount of $1.9 million.

Tyler Baba: We may use the terms such as adjusted gross profit, adjusted gross margin, adjusted EBITDA, shareholder EBITDA, adjusted net income, and adjusted pre-cash flow on this conference call, all of which are non-gap and non-IFRS measures. For more information on how we define these terms, please refer to the definitions set out in today's press release and in our MDNA. The company believes that adjusted EBITDA is a meaningful financial metric as it measures cash generated from operations, which the company can use to fund working capital requirements, service future interest and principal debt repayments, and fund future growth initiatives. Adjusted EBITDA should not be construed as an alternative to net income or loss determined in accordance with IFRS.

Speaker Change: Also, we were expecting to receive $2.3 million in tax credits in Q2, which were late and actually arrived just a few days ago here in Q3.

Eva Fong: It is important to note that our Q2 2024 would have been closer to $11 million with these credits added, which would have been a 17% year-over-year increase. We're continuing to maintain our current guidance for free cash flow available to shareholders of approximately $55 million for the year, representing a 30% year-over-year increase, mainly achieved through cost optimization efforts. This is particularly important given the current inflationary environment, as we do also expect interest rate reductions in the coming months.

Speaker Change: It is important to note that our Q2 2024 would have been closer to $11 million with these credits added, which would have been a 17% year-over-year increase.

Eva Fong: We'll continue to maintain our current guidance for free cash flow available to shareholders of approximately 55 million in 40 years, representing a 30% year-over-year increase, mainly achieved through cost optimization efforts. This is particularly important given the current inflationary environment, as we do also expect interest rate reductions in the coming months. We're projecting that an expected reduction in interest rates in the coming months will also help with cash flow.

Speaker Change: We're continuing to maintain our current guidance for free cash flow available to shareholders of approximately $55 million for the year, representing a 30% year-over-year increase, mainly achieved through a cost optimization effort.

Hamed Shahbazi: And with that, I will turn over the call to Mr. Hamachibasi, Chairman and CEO. Thank you, Tyler, and good day everyone. We appreciate everyone for joining us today. We're extremely pleased to be with you today and discuss our strong momentum and quarter in which we achieved our 22nd consecutive record-breaking revenue quarter, underscoring the enduring momentum of our company. And for the first time, we'll be using some slides to assist us in our presentation.

Speaker Change: This is particularly important given the current inflationary environment as we do also expect interest rate reductions in the coming months. We're projecting that an expected reduction in interest rates in the coming months will also help with our cash flow.

Eva Fong: We're projecting that an expected reduction in interest rates in the coming months will also help with our cash flow. In the past, our focus on M&A has led us to rely on dilution to support our strategy. However, most of this dilution has been associated with our acquisitions in previous years rather than our most recent ones, which is evident in the decline of our earn-out payments.

Eva Fong: In the past, our focus on M&A has led us to rely on the solution to support our strategy. However, most of the solution has been associated with our acquisitions in previous years, rather than our most recent ones, which is evidence in the decline of our earnout payments. In 2022, we settled approximately 65.2 million in earnouts and vendor take-back notes and have 10.2% share that solution. In 2023, we reduced our deferred acquisition cost payments by about 55% to 29.4 million and reduce our valuation to 4.4%. Looking forward in 2024, our current expectations is that our earnout payments will further decline by another 20% to approximately 23.5 million, resulting in share the solution of around 3.3% in 2024.

Speaker Change: In the past, our focus on M&A has led us to rely on dilution to support our strategy. However, most of this dilution has been associated with our acquisitions in previous years, rather than our most recent ones, which is evident in the decline of our earn-out payments.

Hamed Shahbazi: As Tyler indicated earlier, if you joined via webcast, you should already see these. If you don't, you can go to our investor section of our website and either join the webcast or download this, slides. The second quarter of 2024 exceeded all our expectations, showcasing the continued strength and momentum of our technology driven care delivery platforms. We're very proud to report a robust 42% year-over-year revenue growth of which half or approximately 21% came from organic growth, which includes our clinic absorptions.

Eva Fong: In 2022, we set those approximately 65.2 million in earnouts and vendor-take-back notes and have 10.2% shared adjunctions. In 2023, we reduced our deferred acquisition cost payments by about 55% to $29.4 million and reduced our dilution to 4.4%. Looking forward in 2024, our current expectation is that earner payments will further decline by another 20% to approximately $23.5 million, resulting in share dilution of around 3.3% in 2024. As you can see, most of that has already been incurred and we're only expecting a 30.6% dilution for the balance of the year.

Speaker Change: In 2022, we settled approximately 65.2 million in earnouts and vendor-take-back notes and have 10.2% shared admission.

Speaker Change: In 2023, we reduced our deferred acquisition cost payments by about 55% to $29.4 million and reduced our dilution to 4.4%.

Speaker Change: Looking forward in 2024, our current expectation is that earner payments will further decline by another 20% to approximately $23.5 million, resulting in share dilution of around 3.3% in 2024.

Hamed Shahbazi: Note that if you exclude our absorption program enterprise-wide organic growth would have been 16%. The company also experienced 11% year-over-year growth in adjusted EBITDA. You will expand on this later, but we're very pleased to have paid down a significant amount of debt and reduced our leverage ratios in Q2. We're also pleased to have improved annual guidance yet again this quarter. This quarter we've increased revenue guidance to between 970 million and 990 million for the year.

Eva Fong: As you can see, most of that has already been incurred, and we're only expecting a 30.6% solution for the balance of the year. Our largest remaining major earnouts pertain to ocean, doctor care, and my health as we have not committed to a new material earnout arrangement since 2021. As you can see, next year, we'll have a 10 million dollars decline in performance earnouts payable, and then again a major drop of another 10 million dollars down to a very small amount in 2027. Please keep in mind that our performance earnouts are tied to performance, so we would only be paying these projected figures.

Speaker Change: As you can see, most of that has already been incurred, and we're only expecting a 30.6% dilution for the balance of the year.

Eva Fong: Our largest remaining major earnails pertain to ocean, doctor care, and my health, as we have not committed to a new material earnail arrangement since 2021. As you can see, next year, we'll have a $10 million decline in performance earnails payable and then again a major drop of another $10 million staff to a very small amount in 2027. Please keep in mind that our performance earners are tied to performance. So we would only be paying these projected figures if assets such as My Health, Ocean, and Dr. Care continue to perform, which we expect will be the case.

Speaker Change: Our largest remaining major earners pertain to Ocean, DoctorCare, and MyHealth, as we have not committed to a new material earner arrangement since 2021.

Hamed Shahbazi: It should be noted that for the purposes of assessing 2024 annual organic growth we estimate that our 2023 performer revenue would have been approximately 849 million if all of our 2023 acquisitions, excluding clinic absorptions, had occurred on January 1, 2023, and excluding all but one month of intrahealth, which was sold on February 1, 2024. Note that this number differs from what was disclosed in the notes to our 2023 audited financial statements.

Speaker Change: As you can see, next year, we'll have a $10 million decline in performance earnings, payable, and then again a major drop of another $10 million down to a very small amount in 2027.

Speaker Change: Please keep in mind that our performance earners are tied to performance, so we would only be paying these projected figures if assets such as My Health, Ocean, and Dr. Care continue to perform, which we expect will be the case.

Eva Fong: It's assets such as my health, ocean, and doctor care continue to perform, which we expect will be the case.

Eva Fong: To 30 decrease our valuation, we are working on moving our employee incentive programs to be more cash-based rather than share-based compensation programs, which we expect will result in an over 60% decline in share-based compensation awards in 2024 as compared to 2023, where we have some catch-up grants that exceed our normal course grant schedule. We expect this will 30 decline in 2025. While this increase our cash expenses, we are maintaining previous EBITDA in three cash flow guidance, which was recently increased last quarter. In Q2, there were no new incentive shares issued in the quarter. In terms of our share capitalization, as you can see, well actually reduced its fully diluted shares outstanding in Q2 2024.

Eva Fong: To further decrease our dilution, we are working on moving our employee incentive programs to be more cash-based rather than share-based compensation programs, which we expect will result in an over 60% decline in share-based compensation awards in 2024 as compared to 2023, where we had some catch-up grants that exceeded our normal course grant schedule. We expect this will 30 decline in 2025 [inaudible] While this increase our cash expenses, we are maintaining previous EBITDA and free cash flow guidance, which was recently increased last quarter. In Q2, there were no new incentive shares issued in the quarter.

Speaker Change: To further decrease our dilution, we are working on moving our employee incentive programs to be more cash-based rather than share-based compensation programs.

Hamed Shahbazi: Is that performer number included clinic absorptions, intrahealth, and a number of other adjustments? As such, the midpoint of our updated guidance infers an organic growth rate, including absorptions of 15.4% for the year. As for just a deeper doubt, we're maintaining our previous guidance, which was just increased last quarter to the upper range of 125 million to 130 million, despite incurring higher costs due to our projection of significantly lower their issuance and stock base incentives.

Speaker Change: which we expect will result in an over 60% decline in share-based compensation awards in 2024 as compared to 2023 where we had some catch-up grants that exceeded our normal course grant schedule.

Speaker Change: We expect this will further decline in 2025. While this increases our cash expenses, we are maintaining previous EBITDA and free cash flow guidance, which was recently increased last quarter. In Q2, there were no new incentive shares issued in the quarter.

Hamed Shahbazi: We also reiterate our guidance introduced last quarter for free, cascal available to shareholders to be approximately 55 million dollars for the year. Keep in mind that this target guidance does not include any unannounced acquisitions. If we include any material acquisitions, there's a fairly good chance that we would be ahead of our current guidance range, notwithstanding any potential material divestments. Our pipeline of acquisitions continues to be strong, particularly in our Canadian clinics division where we have significant opportunities for acquisition or absorption of clinics.

Eva Fong: In terms of our share capitalization, as you can see, WELL actually reduced its fully diluted shares outstanding in Q2 2024. This is because we paid out all our time-based earners in cash and did not issue any new incentive shares in Q2, and WELL also purchased and returned 119,000 shares to tertiary in Q2 2024. Last year doing 2-2-2-23, we had issued about 389,000 shares for acquisitions and urinal payments. Following along with the focus of reducing shares dilution, as of the end of Q2 2024, the company has used its approved NCIB to repurchase 163,500 shares at an average price of $3.83.

Speaker Change: In terms of our share capitalization, as you can see, WELL actually reduced its fully diluted shares outstanding in Q2 2024. This is because we paid out all our time-based earners in cash and did not issue any new incentive shares in Q2.

Eva Fong: This is because we paid out all our time-based earnouts in cash and did not issue any new incentive shares in Q2, and we also purchased and returned 119,000 shares to Tertiary in Q2 2024. Last year, doing Q2 2023, we had issued about 389,000 shares for acquisitions and earnout payments. Following along with the focus of reducing share dilution, as of the end of Q2 2024, the company has used its approved NCID to repurchase 133,000 and 500 shares at an average price of $3.83. Our repurchases are methodical and continues as we believe that they demonstrate a keen focus on managing and reducing share dilution.

Speaker Change: and WELL also purchased and returned 119,000 shares to tertiary in 2002-2024.

Speaker Change: Last year, during Q2 2023, we had issued about 389,000 shares for acquisitions and earn out payments.

Hamed Shahbazi: In addition, keep in mind that the second half of the year is typically stronger for us in terms of EBITDA generation, and we continue to maintain guidance from improving free cash flow, attributable to shareholders to approximately 55 million dollars, representing a 30% year-over-year increase from 2023.

Speaker Change: Following along with the focus of reducing shear dilution as of the end of Q2 2024, the company has used its approved NCIB to repurchase 163,500 shares at an average price of $3,083.

Eva Fong: Our repurchases are methodical and continuous as we believe that they demonstrate a keen focus on managing and reducing shared dilution. Our intent is to continue to repurchase shares in the coming months and to the extent our strategic alternatives processes yield additional cash resources. We will undertake to increase our buyback rate as the company's board of directors believes WELL's current share price does not adequately reflect the underlying value based on WELL's business prospects and financial position.

Speaker Change: Our repurchases are methodical and continuous as we believe that they demonstrate a keen focus on managing and reducing share dilution.

Eva Fong: Our intent is to continue to repurchase shares in the coming months and, to the extent our strategic alternative processes yield additional cash resources.

Speaker Change: Our intent is to continue to repurchase shares in the coming months and to the extent our strategic alternatives processes yield additional cash resources.

Eva Fong: We will undertake to increase our buyback rates as the company's board of directors believes the world's current share price does not restrict the underlying value based on the world's business prospects and financial positions. Looking at a balance sheet at the end of Q2 2024, WELL and the Q2 2024 with a solid balance sheet. As at June 30, 2024, WELL had cash and cash decoupling of 46.5 million dollars. WELL continues to be in disstanding and fully compliance with all covenants related with its two credit lines, JB Morgan in the US and WELL Bank in Canada. The debt from the Q2 credit lines was approximately 289 million in Canadian dollars as of June 30, 2024.

Speaker Change: We will undertake to increase our buyback rate as the company's board of directors believes WELL's current share price does not adequately reflect the underlying value based on WELL's business prospects and financial position.

Eva Fong: Looking at the balance sheet as at the end of Q2 2024, well end the Q2 2024 with a solid balance sheet. As of June 30, 2024, WELL had cash and cash equivalents of $46.5 million. WELL continues to be in disstanding and fully compliance with all covenants related with his two credit lines, J.B. Morgan in the US and WELL Bank in Canada. The dash on the two credit lines was approximately 289 million in Canadian dollars as of June 30, 2024.

Speaker Change: Looking at our balance sheet as at the end of Q2 2024. WELL ended Q2 2024 with a solid balance sheet. As at June 30, 2024, WELL had cash and cash equivalents of $46.5 million.

Eva Fong: Note that the US dollar did strengthen during the period, so it's important to note that we were able to reduce our US tax facility from US 162.3 million to US 148.8 million during the quarter. WELL's shareholder, Lavert Racial, was 2.67 times as at the end of Q2 2024 compared to 2.75 times as at the end of Q1 2024. We define leverage ratio as net bank debt, that's cash on hand, divided by a shareholder-adjusted EBITDA.

Hamed Shahbazi: Truly a remarkable mouse. Stone. In addition, there are more than 37,000 providers benefiting from our SaaS and technology services with just approaching approximately 40% of all physicians and candidates supported by our platform in some way. Well, it's given a record 1.4 million patient visits in Q2, an increase of 38% has compared to Q2 of 2023, representing 5.6 million patient visits on an annualized run rate basis. Patient visits were comprised of 759,000 patient visits in Canada and 640,000 patient visits in the United States.

Speaker Change: World continues to be in good standing and fully compliant with all covenants related with its two credit lines, J.P. Morgan in the U.S. and World Bank in Canada. The debt from the two credit lines was approximately $289 million in Canadian dollars as of June 30, 2024.

Eva Fong: Looks like the US dollar did strengthen during the period, so it's important to note that we were able to reduce our US debt facility from US 162.3 million to US 148.8 million during the quarter. WELL's shareholder leverage ratio was 2.67 times as at the end of Q2 2024 compared to 2.75 times as at the end of Q1 2024. We define leverage ratio as net bank debt, less cash on hand, divided by a shareholder adjust that you deduct. On a constant currency basis, our leverage ratio was 2.65 times. No day in one includes our convertible debentures, which are turned out for more than two years; our leverage ratio would be approximately 3.45 times.

Speaker Change: Note that the U.S. dollar did strengthen during the period, so it's important to note that we were able to reduce our U.S. debt facility from U.S. $162.3 million to U.S. $148.8 million during the quarter.

Speaker Change: Well-to-shareholder leverage ratio was 2.67 times as at the end of Q2 2024 compared to 2.75 times as at the end of Q1 2024.

Hamed Shahbazi: Canadian patient services visits increased 41% while US patient visits increased 34% on a year-over-year basis. I'd like to point out that organic growth in patient visits, including absorption in Canada, was 25.5% if you strip out absorptions, same clinic growth in visits was 11.4%, which one must remember is much higher and we would guess to be about triple the growth rate of traditional organic growth figures in terms of Canadian healthcare, which are typically in the 3-4% range.

Speaker Change: We define leverage ratio as net bank debt, less cash on hand, divided by a shareholder-adjusted EBITDA.

Eva Fong: On a constant currency basis, our leverage ratio was 2.65 times. Note that if one includes our convertible debentures, which are turned out for more than two years, our leverage ratio would be approximately 3.45 times. Given our trajectory of improved EBITDA and capital efficiency, we are projecting improvements to our leverage ratio over the next couple of quarters. Lastly, one housekeeping item before I turn the call back to the comments. I wanted to provide some additional commentary on the build-up in our accounts receivable balance.

Speaker Change: On a constant currency basis, our leverage ratio was 2.65 times. Note that if one includes our convertible debentures, which are turned out for more than two years, our leverage ratio would be approximately 3.45 times.

Eva Fong: Given access to trajectory of improved EBITDA and capital efficiency, we are projecting improvements to our leverage ratio over the next couple of course.

Speaker Change: Given our trajectory of improved EBITDA and capital efficiency, we are projecting improvements to our latest ratio over the next couple of quarters.

Hamed Shahbazi: I would like to now move on to describing some of the key themes for today's call. One, our very strategies to unlock some of parts value. Two, our plans to spin out our SaaS and services provider solutions line of business as a control public company. And three, our efforts to prove per share metrics by reducing dilution and stock-based compensation, improving profitability and improving shareholder value. And four, we will also be making some important commentary about our clinic consolidation program and the progress we've been experiencing there, too.

Eva Fong: Lastly, one housekeeping item before I turn the call back to Connor. I wanted to provide some additional commentary on the build up in our accounts receivable balance. As we noticed previously, the CLH and the CCA business has experienced delays in cash collections on an CCA claim, including delay billing and as a result of its billing partner Change Healthcare. Who is experiencing a cyber security incident in February 2024? CLH has continued to provide in the CCA services due to due outage. And as a result, accounts receivable relating to these claims has increased. Understanding the consequences business interruption this has caused, Change Healthcare has provided advanced funding to CLH.

Speaker Change: Lastly, one health-giving item before I turn the call back to Connor.

Speaker Change: I wanted to provide some additional commentary on the build-up in our accounts receivable balance.

Eva Fong: As we noted previously, the CLH anesthesia business has experienced delays in cash collections on anesthesia claims, including delay billing, and as a result of its billing partner Change Healthcare, who is experiencing a cybersecurity incident in February 2024. CLH has continued to, provide anesthesia services during outage.

Speaker Change: As we noted previously, the CLH anesthesia business has experienced delays in cash collections on anesthesia claims, including delay billing, and as a result of its billing partner change healthcare.

Speaker Change: who is experiencing a cyber security incident in February 2024. CLH has continued to...

Eva Fong: And as a result, accounts receivable relating to these claims has increased. Understanding the significant business interruption this has caused, Change Healthcare has provided advanced funding to CLH in lieu of the cash collections CLH would normally receive. Related to these claims was the expectation that upon resuming normal billing and collection activities, the advanced funding would be repaid as cash collections from payers and patients. R.E.C.

Speaker Change: provide anesthesia services during outage. And as a result, accounts receivable relating to these claims has increased.

Hamed Shahbazi: On to unlocking some of the parts. This is something that we covered off at investor day, but we'd like to revisit a bit today. Well, it's a diverse and multifaceted healthcare technology company with multiple business lines operating across both the US and Canadian markets. Well, it's natural for there to be a small discount to the multiple holdings of a conglomerate such as well. We believe that the discount currently associated with wealth far exceeds a normal conglomerate or holding company discount.

Speaker Change: Understanding the significant business interruption this has caused

Eva Fong: In lieu of the cash collection, CLH would normally receive related to these claims with the expectation that, upon resuming normal billing and collection activities, the advanced funding would be repaid as cash collections from payers and patients are received. Given the contractual terms underlying the advanced funding received, these funds have been recorded within other liabilities as of June 30th, 2024, totaling US$58 million. Hence, the related increase in other liabilities during the quarter, which offset the increase in accounts receivable.

change healthcare: Change healthcare has provided advanced funding to CLH. In lieu of the cash collection, CLH would normally receive related to these claims with the expectation that upon resuming normal billing and collection activities, the advanced funding would be repaid as cash collections from peers and patients.

Eva Fong: Given the contractual terms underlying the advance funding received, these funds have been recorded within other liabilities as at June 30, 2024, totaling US$58 million. Hence the related increase in other liabilities during the quarter, which offset the increase in accounts receivables. That is my financial update and I turn the call back over to Hamed. Thank you, Eva.

Speaker Change: I'll recede.

Hamed Shahbazi: And we believe this is an opportunity for those investors who are looking for hidden but realizable value. While some of that discount has been corrected since our investor day, we believe that there's still an approximately an 800 million to $1 billion discount to our true sum of parts. As you'll see in today's presentation, these overlooked segments are not only strong performance, but they're also experiencing significant growth and momentum. Therefore, we propose a sum of parts valuation approach to more accurately assess the company's worth.

Speaker Change: Given the contractual terms underlying the advance funding received, these funds have been recorded within other liabilities as of June 30, 2024, totaling US$58 million.

Speaker Change: Hence, the related increase in other liabilities during the quarter, which offset the increase in accounts receivables.

Hamed Shahbazi: That is my financial update, and I turn the call back over to Hannah.

Speaker Change: That is my financial update and I turn the call back over to Hamed.

Hamed Shahbazi: Thank you, Eva. Performance of our Canadian patient services business has been exceptionally strong, generating $76.7 million in revenue, including to 2020. for, an increase of 42% from U2 2023 and is ahead of our previous guidance of achieving $300 million in revenue in 2024.

Hamed Shahbazi: Performance of our Canadian patient services business has been exceptionally strong, generating $76.7 million in revenue in Q2 2024, an increase of 42% from Q2 2023 and is ahead of our previous guidance of achieving $300 million in revenue in 2024. Let's first look at the primary care segment as part of our patient services group. The company's primary care business unit generated revenue of $45.5 million in Q2 2024, an increase of 83% compared to Q2 2023.

Hamed Shahbazi: Thank you Eva. Performance of our Canadian patient services business has been exceptionally strong generating 76.7 million dollars in revenue in Q2 2024.

Hamed Shahbazi: We believe that unlocking the value of some of our assets through third-party arms-length investments or divestments could go a long way to highlight this value. In the case where divestments occur, such cash benefits could be material and could be likely used to pay down debt or to issue a special buyback or make additional accretive acquisition. Last quarter, we indicated that we had begun considering strategic alternatives for our US patient, digital patient services businesses, circle medical and waste.

Speaker Change: An increase of 42% from Q2 2023 and is ahead of our previous guidance of achieving $300 million in revenue in 2024.

Hamed Shahbazi: Let's first look at the primary care segment as part of our Patient Services group. The company's primary care business unit generated revenue of $45.5 million in Q2 2024, an increase of 83% compared to Q2 2023. This increase relates primarily to the acquisitions of MCI Ontario and Alberta-based medical clinic and the large Manitoba clinic, as well as strong organic growth in existing clinics, including the impact from clinic absorptions over the past 12 months. We are now very closely watching our 2023 cohort of clinic absorptions and acquisitions. Included in the 2023 cohort is the large Manitoba clinic and the MCI Ontario clinics.

Speaker Change: Let's first look at the primary care segment as part of our patient services group.

Speaker Change: The company's primary care business unit generated revenue of $45.5 million in Q2 2024, an increase of 83% compared to Q2 2023.

Hamed Shahbazi: Disincrease relates primarily to the acquisitions of MCI Ontario and Alberta-based medical clinics and the large Manitoba clinic as well as strong organic growth in existing clinics, including the impact from clinic absorptions over the past. We are now very closely watching our 2023 cohort of clinic absorptions and acquisitions included in the 2023 cohort is the large Manitoba clinic and the MCI Ontario. Recall, these clinics were not profitable and caused downward pressure on our EBITDA margins in Q4 of 2023.

Speaker Change: This increase relates primarily to the acquisitions of MCI Ontario and Alberta-based medical clinics and the large Manitoba clinic, as well as strong organic growth in existing clinics, including the impact from clinic absorptions over the past 12 months.

Speaker Change: We are now very closely watching our 2023 cohort of clinic absorptions and acquisitions.

Speaker Change: Included in the 2023 cohort is the large Manitoba clinic

Hamed Shahbazi: Recall these clinics were not profitable and caused downward pressure on our EBITDA margins in Q4 of 2023. I'm proud to announce that the digitization and transformation efforts at these clinics is running ahead of plans, and as of today both Manitoba Clinic and MCI Ontario clinics are running at positive adjusted EBITDA. Going forward, we expect to continue to increase EBITDA margins of these clinics over the next year. Our outlook for primary care continues to look strong for the third quarter and beyond, notwithstanding the transformation and digital digitization work that we are doing on the acquired Shoppers Drug Mart clinics, which have had a temporary negative impact on our P&L.

Hamed Shahbazi: I'm proud to announce that the digitization and transformation efforts at these clinics is running ahead of, And as of today, both Manitoba Clinic and MCI Ontario Clinics are running at positive adjusted EBITDA. Going forward, we expect to continue to increase EBITDA margins of these clinics over the next year. Our outlook for primary care continues to look strong for the third quarter and beyond, notwithstanding the transformation and digital digitization work that we are doing on the Acquired Stoppers Drug Mart clinics, which have had a temporary negative impact on our P&L.

Speaker Change: and the MCI Ontario clinics. Recall, these clinics were not profitable and caused downward pressure on our EBITDA margins in Q4 of 2023.

Hamed Shahbazi: In addition, WELL has a call option for both these businesses, which provides us with several alternatives, including acquiring the remaining ownership of the businesses, speaking in IPO or RTO or selling the businesses entirely. We have hired professional advisors to help us with these processes. In the case of circle medical, the call option has a timeline which has now been extended with the approval of the minority shareholders well into 2025. We are pleased to announce that circle medical has retained JP Morgan to evaluate strategic alternatives and help identify a partner or partners that will support circle in its next phase of growth.

Speaker Change: I'm proud to announce that the digitization and transformation efforts at these clinics is running ahead of plan. And as of today, both Manitoba Clinic and MCI Ontario Clinics are running at positive adjusted EBITDA.

Speaker Change: Going forward, we expect to continue to increase EBITDA margins of these clinics over the next year.

Speaker Change: Our outlook for primary care continues to look strong for the third quarter and beyond, notwithstanding the transformation and digitization work that we are doing on the Acquired Shoppers Drug Mart Clinics, which have had a temporary negative impact on our P&L.

Hamed Shahbazi: As we go through the process of digitizing and modernizing these clinics, we expect them to become profitable in 2024. And in fact, we are ahead of plan with our work, as we are almost at break even at these clinics. Note that we have owned them for less than 100 days, and when we purchased them, they were significantly negative. So we're very pleased at the progress that we've made here. I will reiterate that we believe primary care will maintain strong absolute and organic growth through 2024 and beyond. Our recruitment absorption and M&A pipelines are very strong and have more than 50 clinics in various stages of pre-LYDD, LY, and post-LYDD.

Hamed Shahbazi: On the west side of things, we're similarly pleased to report the CIBC capital markets is assisting us with our evaluation of strategic alternatives. We will provide updates as they become available on both of these processes that do not expect updates until later this year, or especially in the case of circle medical early next year. In addition to evaluating strategic alternatives for circle and west, we started to look at additional opportunities for unlocking value, and we're very pleased to disclose that we are working on another important initiative that we believe will yield significant shareholder value.

Speaker Change: As we go through the process of digitizing and modernizing these clinics, we expect them to become profitable in 2024 and in fact we are ahead of plan with our work as we are almost set break even at these clinics.

Hamed Shahbazi: So we're very pleased at the progress that we've made. I will reiterate that we believe primary care will maintain strong absolute and organic growth through 2024 and beyond. Our recruitment absorption and emanate pipelines are very strong and have more than 50 clinics in various stages of pre-L-O-I-D-D, L-O-I and post-L-O-I-D. We believe this is directly correlated with the challenges doctors are feeling in the marketplace and WELL's growing brand recognition and ability to execute. And now a few words about WELL Health Diagnostic Centers.

Speaker Change: Note that we have owned them for less than 100 days, and when we purchased them, they were significantly negative, so we're very pleased at the progress that we've made here.

Speaker Change: I will reiterate that we believe primary care will maintain strong, absolute and organic growth.

Speaker Change: through 2024 and beyond. Our recruitment, absorption, and M&A pipelines are very strong and have more than 50 clinics in various stages of pre-LOIDD, LOI, and post-LOIDD.

Hamed Shahbazi: And that's related to our platform solutions business. We believe our SaaS and services provider solutions business is a very strong candidate as a potential spin out as a well-controlled standalone public company. Excluding cybersecurity, our provider solutions group achieved external revenue of $10.4 million in Q2 2024 with 86% gross margins, 30% EBITDA margins, and 24% organic growth with over 90% of its revenues contractual and recurring in nature. This is a very healthy and profitable SaaS business with great growth prospects.

Hamed Shahbazi: We believe this is directly correlated with the challenges doctors are feeling in the marketplace and well as growing brand recognition and ability to execute.

Speaker Change: We believe this is directly correlated with the challenges doctors are feeling in the marketplace and WELL's growing brand recognition and ability to execute.

Hamed Shahbazi: Now a few words about well health diagnostic centers. Well Health Diagnostics had a very strong Q2 2024, achieving a total of 172,000 patient visits and record quarterly revenue of 31.2 million, an increase of 7% compared to Q2 2023. Q2 has historically been and continues to be our strongest quarter in this line of business. This performance was driven by organic growth from the expansion of services as well as healthcare providers. We note that both adjusted growth margin and adjusted EBITDA as a percentage of revenue decrease compared to the same quarter in the prior year due to the higher-than-normal EBITDA in the second quarter of 2023 as a result of higher diagnostic consultations in our high-margin nuclear medicine line of business and availability of materials.

Hamed Shahbazi: WELL Health Diagnostics had a very strong Q2 2024, achieving a total of 172,000 patient visits and record quarterly revenue of $31.2 million, an increase of 7% compared to Q2 2023. Q2 has historically been and continues to be our strongest quarter in this line of business. This performance was driven by organic growth from the expansion of services as well and health where provide, We note that both adjusted gross margin and adjusted EBITDA as a percentage of revenue decrease compared to the same quarter in the prior year due to the higher than normal EBITDA in the second quarter of 2023 as a result of higher diagnostic consultations in our high margin, you could have medicine line of business and availability of materials, and lower direct costs due to stock incentives provided to physicians who are earn out partners of the company, which also occurred in Q2 2023.

Speaker Change: And now a few words about WellHealth Diagnostic Centers.

Speaker Change: WELL Health Diagnostics had a very strong Q2 2024, achieving a total of 172,000 patient visits and record quarterly revenue of $31.2 million, an increase of 7% compared to Q2 2023.

Speaker Change: Q2 has historically been, and continues to be, our strongest quarter in this line of business. This performance was driven by organic growth, from the expansion of services, and health care providers.

Hamed Shahbazi: We believe provider solutions group would be valued at a much higher valuation multiple than the value that is currently being afforded to well-held. In addition, we believe we could accelerate the growth of this business as a standalone public company, which would then ramp up its own capital allocation program to ensure it is growing methodically, both organically and inorganically. The provider solutions group is an integral part of the Canadian clinics ecosystem that tech-enabled doctors and other healthcare providers in our clinics.

Speaker Change: We note that both adjusted gross margin and adjusted EBITDA as a percentage of revenue decrease compared to the same quarter.

Speaker Change: In the prior year due to the higher than normal EBITDA in the second quarter of 2023, as a result of higher diagnostic consultations in our high margin nuclear medicine line of business and the availability of materials.

Hamed Shahbazi: and lower direct costs due to stock incentives provided to physicians who are urinal partners of the company, which also occurred in Q2 2023. Second quarter is seasonally our strongest quarter, which is followed by a slower third quarter. For the full year 2024, we are expecting that our well-health diagnostic centers to achieve another year of record revenue in EBITDA. In addition, Cancer Care Ontario has decreased the eligibility age of breast cancer screening from 50 to 40 years of age, which comes into effect in the fall of 2024. This should result in a material increase in demand in mammography screening and overall improvement in Ontario patient care in Q4.

Hamed Shahbazi: It's also an area where we have clear market leadership to support healthcare providers nationally. Where a market share ownership in EMR in Canada is third, if you look at the full platform requirements of a healthcare provider, which include billing management, productivity app, and other elements, to our knowledge there is no bigger market share owner in the country than well-provider solutions and to- University. Even after a prospective spin-out of our provider solutions group, this group will continue to work closely with and support our clinics and clinic transformation team.

Speaker Change: and lower direct costs due to stock incentives provided to physicians who are urn out partners of the company, which also occurred in Q2 2023.

Hamed Shahbazi: The second quarter is seasonally our strongest quarter, which is followed by a slower third quarter. For the full year 2024, we are expecting that our WELL Health Diagnostic Centers to achieve another year of record revenue and EBITDA. In addition, Cancer Care Ontario has decreased the eligibility age of breast cancer screening from 50 to 40 years of age, which comes into effect in the fall of 2024.

Speaker Change #100: Second quarter is seasonally our strongest quarter which is followed by a slower third quarter. For the full year 2024 we are expecting that our WellHealth Diagnostic Centers to achieve another year of record revenue in EBITDA.

Speaker Change #101: In addition, Cancer Care Ontario has decreased the eligibility age of breast cancer screening from 50 to 40 years of age, which comes into effect in the fall of 2024.

Hamed Shahbazi: This should result in a material increase in demand in mammography screening and overall improvement in Ontario patient care in Q4. In terms of M&A, we continue to have strong discussions with various players in the industry with the hopes and intentions of expanding our diagnostic centers to more provinces and sites in 2024, as well as in our church. I'll now discuss our U.S. businesses. First, WELL Health USA, which includes CRH and provider staff.

Speaker Change #101: This should result in a material increase in demand in mammography screening and overall improvement in Ontario patient care in Q4.

Hamed Shahbazi: As such, well as intentions are to maintain a strong economic and voting majority in the entity, even after it spun out as a separate publicly listed company. As such, there should be no real changes to how this entity operates and interacts with our own clinics, which is very important to our own development within our well-clinic ecosystem.

Hamed Shahbazi: In terms of M&A, we continue to have strong discussions with various players in the industry, with the hopes and intentions of expanding our diagnostic centers to more provinces and sites in 2024, as well as in Ontario.

Speaker Change #102: In terms of M&A, we continue to have strong discussions with various players in the industry, with the hopes and intentions of expanding our diagnostic centers to more provinces and sites in 2024, as well as in Ontario.

Hamed Shahbazi: I'll now discuss our US businesses. First, WELL Health USA, which includes CRH and provider staffing. WELL USA increased revenue in Q2 2024 to 93.3 million compared to 63.4 million in Q2 in the previous year. Last year's EBITDA included 4.7 million in revenue directly related with divestment-related impact. If one were to adjust, Eva had referenced this in her script. If one were to adjust for this, adjusted EBITDA would have increased 7% to $19.6 million. CRH has completed the first half of the year now with a full year of integration and operations following the July 2023 acquisition of Care Plus Management.

Hamed Shahbazi: WELL USA increased revenue in Q2 2024 to $93.3 million compared to $63.4 million in Q2 in the previous year. Last year's EBITDA included $4.7 million in revenue directly related with divestment related, If one were to adjust, Eva had referenced this in her script, if one were to adjust for this, adjusted EBITDA would have increased 7% to $19.6 million. CRH has completed the first half of the year now with a full year of integration and operations following the July 2023 acquisition of care plus management. You will recall care plus included a traditional practice of anesthesia serving 14 locations.

Hamed Shahbazi: We're very excited about this initiative, and we'll provide more updates in the coming weeks and months.

Speaker Change #102: I'll now discuss our U.S. businesses.

Speaker Change #104: First, WELL Health USA, which includes CRH and Provider Staffing. WELL USA increased revenue in Q2 2024 to 93.3 million compared to 63.4 million in Q2 in the previous year.

Hamed Shahbazi: The third key theme is one of the most important for the call today, our commitment to delivering improved shareholder value. Last quarter in our conference call, we talked about an important inflection point, where WELL was going to focus more intently on optimizing our profit per share metrics by not only improving our overall organic growth and profitability, but also paying brick and significant attention to our dilution and pulling all the levers we could to reduce and eventually fully eliminate and then reverse dilution.

Speaker Change #105: Last year's EBITDA included $4.7 million in revenue directly related with divestment related impact.

Speaker Change #106: If one were to adjust, Eva had referenced this in her script, if one were to adjust for this, adjusted EBITDA would have increased 7% to $19.6 million.

Hamed Shahbazi: These have now been fully integrated and operate under CRH anesthesia care plus management also included the radar provider staffing business, which is a premier and trusted staffing and low attendance business. You will recall care plus management also included the radar provider staffing business and low attendance business. Specializing in anesthesia across the lower 48 states.

Speaker Change #107: Sarah H. has completed the first half of the year now with a full year of integration and operations following the July 2023 acquisition of Care Plut Management.

Hamed Shahbazi: I'm pleased to note that this quarter we made excellent progress towards these stated goals, and as Eva will demonstrate later, we were able to actually reduce our fully diluted share totals during the quarter slightly by paying out all of our earnouts and cash, not issuing any new incentive fair awards, and actually electing to pay some of our incentives in cash, which our long term incentive plans allows for and buying back some stock. We will be applying the same intensity to managing dilution, driving organic growth, and improving our profitability in subsequent quarters as we work hard to realize some of the parts value and significantly elevate shareholder value.

Hamed Shahbazi: You will recall Care Plus included the traditional practice of anesthesia serving 14 locations. These have now been fully integrated and operate under CRH Anesthesia Care Plus Management. Also included is the Radar Provider Staffing business, which is a premier and trusted staffing and local tenants business specializing in anesthesia across the lower 48 states. The business continues to be extremely complimentary to CRH's legacy anesthesia business and provides high revenue growth along with many operating synergies. We expect growth of this segment to continue with an anesthesia, as well as our plans to expand to other health care specialties.

Speaker Change #108: You will recall Care Plus included a traditional practice of anesthesia serving 14 locations. These have now been fully integrated and operate under CRH anesthesia.

Speaker Change #108: Care Plus Management also included the Radar Provider Staffing business, which is a premier and trusted staffing and locum tenants business.

Hamed Shahbazi: The business continues to be extremely complementary to CRH's legacy anesthesia business and provides high revenue growth, along with many operating synergies. We expect growth of this segment to continue within anesthesia, as well as our plans to expand to other healthcare specialties. Due to health insurance and payer mixed risks, along with patient deductibility.

Speaker Change #108: Specializing in anesthesia across the lower 48 states.

Speaker Change #109: The business continues to be extremely complementary to CRH's legacy anesthesia business and provides high revenue growth along with many operating synergies. We expect growth of this segment to continue within anesthesia as well as our plans to expand to other healthcare specialties.

Tyler Baba: With that, I'd now like to turn the call over to our CFO, Eva Phong, who will provide some financial context and color on some of the most important themes of unlocking shareholder value. I'll then come back and provide some further commentary on our lines of business.

Hamed Shahbazi: Due to health insurance and pair mixed gifts, along with patient deductibilities, deductibles pardon me generally being met in the last half of the year. We expect both growth and profitability to accelerate in the second half of the year in line with our seasonal norms. And now for Circle Medical, where growth accelerated in Q2. Circle's revenue surged to $32 million in Q2 2024, an increase of 53% compared to Q2 2023. It's important to note that we're seeing this along with margin expansion, which is generally not what our competitors are seeing in the industry. Growth margins grew by 500 basis points from 49.4% to 54.4% on a year-over-year basis.

Speaker Change #109: Due to health insurance and payer mixed bids, along with patient deductibles generally being met in the last half of the year, we expect both growth and profitability to accelerate in the second half of the year in line with our seasonal norms.

Hamed Shahbazi: Deductibles, pardon me, generally being met in the last half of the year, we expect both growth and profitability to accelerate in the second half of the year, in line with our seasonal norm, and now for Circle Meta, where growth accelerated in Q2. Circle's revenue surged to $32 million in Q2 2024, an increase of 53% compared to Q2 2023. It's important to note that we're seeing this along with margin expansion, which is generally not what our competitors are seeing in the industry. Gross margins grew by 500 basis points from 49.4% to 54.4% on a year-over-year basis.

Speaker Change #109: And now for Circle Medical.

Speaker Change #109: where growth accelerated in Q2.

Speaker Change #110: Circle's revenue surged to $32 million in Q2 2024, an increase of 53% compared to Q2 2023. It's important to note that we're seeing this along with margin expansion, which is generally not what our competitors are seeing in the industry.

Eva Fong: I won't go into too much of the financial details as they are available on Cedar Plus, but instead, I'll go through other key financial metrics in the next few slides. Wallachite records I's net income of $170 million in Q2, 2024 compared to a lot of $2 million in Q2, 2023. This increase in net income was largely driven by significant and real-life gains of well-investment in here while AI. Our net income be remained positive, even if we exclude and realize gains from our investments in here while, which shows the progress we are making overall.

Speaker Change #110: Gross margins grew by 500 basis points from 49.4% to 54.4% on a year-over-year basis.

Hamed Shahbazi: Comparatively, if you look at Teladog, for example, they're citing higher customer acquisition costs, which is putting pressure on their margins, while Circle Medical is experiencing lower customers. Acquisition cost. Circles, organic growth was driven by strong patient acquisition, coupled with an expansion of its provider network, which now consists of 547 medical providers. Looking beyond Q2, the future looks bright. You may have seen that we released a corporate update specifically to update shareholders on Circle Medical yesterday, and it the company announced that its revenue in July was a record $8.87 million USD, representing more than a 60% increase compared to the same month last year.

Hamed Shahbazi: Comparatively, if you look at Teladoc, for example, they're citing higher customer acquisition costs, which is putting pressure on their margins, while Circle Medical is experiencing lower customer acquisition costs. Circles Organic Growth was driven by strong patient acquisition coupled with an expansion of its provider network which now consists of 547 medical providers. Looking beyond Q2, the future looks bright. You may have seen that we released a corporate update specifically to update shareholders on Circle Medical yesterday. In it, the company announced that its revenue in July was a record $8.87 million USD, representing more than 60% increase compared to the same month last year.

Speaker Change #111: Comparatively, if you look at Teladoc, for example, they're citing higher customer acquisition costs, which is putting pressure on their margins, while Circle Medical is experiencing lower customer acquisition costs.

Speaker Change #112: Circle's organic growth was driven by strong patient acquisition coupled with an expansion of its provider network, which now consists of 547 medical providers.

Eva Fong: Now setting this, we think that what is more important than a share price gains here while has made this year is incredible improvement. It has made in terms of its business its execution and fundamentals. Here, Wall's current run rate revenue is already surpassing 65 million and is projected to be approaching 100 million by the end of the year on a run rate basis. Hewar has also given guidance for reaching probability in 2025.

Speaker Change #113: Looking beyond Q2, the future looks bright. You may have seen that we released a corporate update specifically to update shareholders on Circle Medical yesterday. In it, the company announced that its revenue in July was a record $8.87 million.

Hamed Shahbazi: This means that Circle Medical has now achieved and exceeded the important milestone of $100 million U.S. dollar run rate while maintaining gross margins of approximately 55%. The company has positioned itself for continued growth with key hires and partnerships. In particular, it is increasing its investment in AI technologies with a focus on leveraging its growing base of data to deliver better care at scale. In July, CERCLE hired its head of AI, Miguel Jette.

Speaker Change #114: USD representing more than 60% increase compared to the same month last year. This means that Circle Medical has now achieved and exceeded the important milestone of $100 million U.S. dollar run rate, while maintaining gross margins of approximately 55%.

Hamed Shahbazi: This means that Circle Medical has now achieved and exceeded the important milestone of $100 million USD run rate, while maintaining gross margins of approximately 55%. The company has positioned itself for continued growth with key hires and partnerships. In particular, it is increasing its investment in AI technologies with a focus on leveraging its growing base of data to deliver better care at scale. In July, Circle hired its Head of AI, Miguel Jaté. Miguel has over 20 years experience in the field of AI, and he most recently was the VP of AI at Rev, a speech technology company where he built the world's most accurate speech-to-text engine and previously served as speech scientist at Nuaz.

Eva Fong: This is pretty incredible, for a company that has less than 10 million in revenues just 10 months ago. At a time when we may be approaching a period of recession and deflation, it is important to note that Hewar is a technology company that is serving the life sciences sector with very steady, resilient and defensive revenue streams. This includes doctors, clinicians, and hospitals for its co-pilot products and the pharmaceutical industry with its real-world evidence, scientific research, and clinical trials, orchestration services.

Speaker Change #115: The company has positioned itself for continued growth with key hires and partnerships. In particular, it is increasing its investment in AI technologies with a focus on leveraging its growing base of data to deliver better care at scale.

Hamed Shahbazi: Miguel has over 20 years' experience in the field of AI, and he most recently was the VP of AI at REV, a speech technology company where he built the world's most accurate speech-to-text engine and previously served as speech scientist at Nuance. Miguel will also lead the company's partnership with MILA, Quebec Artificial Intelligence Institute. MILA is the world's largest academic research center for deep learning, bringing together over 1,200 specialized researchers in machine learning.

Speaker Change #115: In July , Strickle hired its head of AI, Miguel Jeté.

Miguel Jote: Miguel has over 20 years experience in the field of AI, and he most recently was the VP of AI at REV, a speech technology company where he built the world's most accurate speech-to-text engine, and previously served as speech scientist at Nuance.

Eva Fong: We expect to exercise our call options within the next few quarters, which will further increase wealth, economics and voting interest in the company and will end our period of immersion of the unrealized gains on our books. I thought he adjusted that income, which adjusts our all unrealized gains such as the Hewar share gains recorded in our IFR's net income, it is important to note that we are making progress. I would like to point out that last year in Q2 2023, we recorded adjusted that income of 14.4 million.

Hamed Shahbazi: Miguel will also lead the company's partnership with Nila Quebec Artificial Intelligence Institute. Nila is the world's largest academic research center for deep learning, bringing together over 1,200 specialized researchers in machine learning. In other key hires, the return of Brent LaRou to Circle Medical in the role of VP Product and Patient Experience, Brent's return to Circle signals a renewed focus on product design as a core competency, which will drive further usage and engagement. For Q3, we expect another record revenue quarter with positive adjusted EBITDA as the business goes from strength to strength, and we reiterate our previous guidance of Circle expecting to be positive EBITDA for the year.

Speaker Change #117: Miguel will also lead the company's partnership with NILA, Quebec Artificial Intelligence Institute. NILA is the world's largest academic research center for deep learning, bringing together over 1,200 specialized researchers in machine learning.

Hamed Shahbazi: Another key hires the return of Brent LaRue to circle medical in the role of VP product and patient experience. Brent's return to circle signals a renewed focus on product design as a core competency which will drive further usage and engage. For Q3, we expect another record revenue quarter with positive adjusted EBITDA as the business goes from strength to strength, and we reiterate our previous guidance of CERCLE expecting to be, Positive Edita for the Year And now an update on WISP.

Speaker Change #118: Another key hire is the return of Brent LaRue to Circle Medical in the role of VP Product and Patient Experience. Brent's return to Circle signals a renewed focus on product design as a core competency which will drive further usage and engagement.

Eva Fong: However, this includes a one-time real-life benefits of 3.5 million worth of income associated with the termination of a management contract by one of the data. The investment partners of CLH. See, whenever CLH sells and it is an assistive asset, they typically retain a management contract that provides ongoing management fees. If such a contract is terminated, it accelerates the management fees only.

Speaker Change #119: For Q3, we expect another record revenue quarter with positive adjusted EBITDA as the business goes from strength to strength, and we reiterate our previous guidance of CERCLE expecting to be positive EBITDA for the year.

Hamed Shahbazi: And now an update on WISP. I'm pleased to report that WISP reported positive adjusted EBITDA in Q2, 24, with revenue of 24.3 million and an increase of 27% from Q2, 2023. More importantly, WISP improves its profitability, with adjusted EBITDA increasing 225% compared to Q2 last year. Adjusted gross margins improved this quarter compared to the same quarter last year due to better pricing negotiations with pharmacy partners, as well as prior margins were negatively impacted by a significant outage at one of the company's main pharmacy partners. As far as product development is concerned, WISP has been very busy with its fertility vertical with pre-IVF prescription offering.

Hamed Shahbazi: I'm pleased to report that WISP reported, We're just to eat positive adjusted EBITDA in Q224 with revenue of 24.3 million and increase of 27% from Q223. More importantly, WISP improved its profitability with adjusted EBITDA increasing 225% compared to Q2 last year. Adjusted gross margins improved this quarter compared to the same quarter last year due to better pricing negotiations with pharmacy partners, as well as prior margins were negatively impacted by significant outage at one of the company's main pharmacy partners.

Speaker Change #119: And now an update on WISP. I'm pleased to report that WISP reported

Speaker Change #119: Positive Adjusted EBITDA in Q224 with revenue of 24.3 million and increase of 27% from Q2223.

Eva Fong: If one were to normalize for this one-time income last year, we would see a 13% year-over-year increase to this year's adjusted net income of 12.3 million. As I pointed out earlier by Hammond, well, he is extremely focused on his per share performance metrics. It has had significant success with his revenue per share going from 16 cents per share in Q1 2021 to over $1 share per share as of Q2 2024.

Speaker Change #120: More importantly, WISP improves its profitability with adjusted EBITDA increasing.

Speaker Change #120: 225% compared to Q2 last year.

Speaker Change #120: Suggested gross margins improved this quarter compared to the same quarter last year due to better pricing negotiations with pharmacy partners, as well as prior margins were negatively impacted by significant outage at one of the company's main pharmacy partners.

Hamed Shahbazi: As far as product development is concerned, WIST has been very busy with its Fertility Vertical with pre-IVF prescription offering. It has also launched its new UTI Care Kit, while also expanding at-home diagnostics, which will be foundational to establishing a longitudinal care model and key new product launches by the end of the year. In July, WIS Plus was also launched and has seen strong early traction as an annual membership program where patients can access discounts on products as well as exclusive services. Bink, Amazon Prime for Wist.

Eva Fong: But we have much more focus on our adjusted FBDA and adjusted shareholder FBDA, which removes the non-controlled interest, as well as free cash flow available to shareholders, which we consider to be the most important metric to track as a capital allocator. Well achieved free cash flow to shareholders of 8.7 million in Q2 2024. You'll notice that this shows a sequential decline compared to Q1 2024. This is mainly due to the fact that in Q2, we make 50% of our interest payments for the year for our convertible debentures in the amount of $1.9 million. Also, we were expecting to receive $2.3 million in tax credits in Q2, which were late and actually arrived just a few days ago here in Q3.

Speaker Change #121: As far as product development is concerned, WIST has been very busy with its fertility vertical with pre-IVF prescription offerings. It has also launched its new UTI care kit while also expanding at-home diagnostics.

Hamed Shahbazi: It has also launched its new UTI care kit while also expanding at-home diagnostics, which will be foundational to establishing a longitudinal care model and key new product launches by the end of the year. In July, WISP was also launched and has seen strong early traction as an annual membership program where patients can access discounts on products as well as exclusive services. Inc. Amazon Prime for WISP. For Q3, we expect WISP to see continued growth as a business ramped up marketing spend to lean into summer seasonality.

Speaker Change #121: which will be foundational to establishing a longitudinal care model and key new product launches by the end of the year.

Speaker Change #122: In July with us, we've also launched and had seen strong early traction as an annual membership program where patients can access discounts on products as well as exclusive services.

Hamed Shahbazi: For Q3, we expect UIST to see continued growth as the business ramps up marketing spend to lean into summer seasonality. And finally, our staff and services. Providers, Solutions, Business, Our SaaS and technology business experienced a revenue increase of 27% in Q2 2024 compared to the previous year, primarily due to the company's cybersecurity division, where external revenue increased by $4.2 million due to acquisitions and timing of larger software project awards. Excluding cybersecurity, revenue from the continuing platform business, meaning excluding intrahealth, which was sold to HealWell and Q1, increased by 22% to $10.4 million. It should be noted that all increases in revenue in this segment were almost entirely organic, as there have been no material acquisitions in the last year.

Speaker Change #122: For Q3, we expect UIST to see continued growth as the business ramps up marketing spend to lean into summer seasonality.

Hamed Shahbazi: And finally, our SAS and services provider solutions business. Our SAS and technology business experience the revenue increase of 27 percent in due to 2024, compared to the previous year, primarily due to the company's cybersecurity division, where external revenue increased by $4.2 million due to acquisitions and timing of larger software project awards. Excluding cybersecurity, revenue from the continuing platform business, meaning excluding inter-health, which was sold to Heelwell and Q1, increased by 22 percent to 10.4 million. It should be noted that all increases in revenue in this segment were almost entirely organic, as there have been no material acquisitions in the last year.

Speaker Change #122: And finally, our SaaSen services.

Eva Fong: It is important to note that our Q2 2024 would have been closer to $11 million with these credits added, which would have been a 17% year-over-year increase. We'll continue to maintain our current guidance for free cash flow available to shareholders of approximately 55 million in 40 years, representing a 30% year-over-year increase, mainly achieved through cost optimization efforts. This is particularly important given the current inflationary environment as we do also expect interest rate reductions in the coming months. We're projecting that an expected reduction in interest rates in the coming months will also help without cash flow.

Speaker Change #122: Providers Solutions Business.

Speaker Change #123: Our SaaS and technology business experienced a revenue increase of 27% in Q2 2024 compared to the previous year, primarily due to the company's cybersecurity division, where external revenue increased by $4.2 million due to acquisitions and timing of larger software project awards.

Speaker Change #124: Excluding cybersecurity, revenue from the continuing platform business, meaning excluding intra-health, which was sold to HealWell and Q1, increased by 22% to $10.4 million.

Speaker Change #125: It should be noted that all increases in revenue in this segment were almost entirely organic as there have been no material acquisitions in the last year.

Hamed Shahbazi: On July 10, 2024, we announced the approval of a historic $44 million project, health compass to the largest digital supercluster project ever awarded in advance AI power tech enablements for care providers. This initiative led by WELL and its consortium partners aims to enhance AI and interoperability in Canadian healthcare. As a lead commercialization partner and first customer, we will provide expertise and interoperability enabling the development of new AI tools to support healthcare providers.

Hamed Shahbazi: On July 10, 2024, we announced the approval of a historic $44 million project, Health Compass, to the largest digital supercluster project ever awarded in advance to advance AI power tech enablements for care providers. This initiative led by WELL and its consortium partners aims to enhance AI and interoperability in Canadian healthcare. As a lead commercialization partner and first customer, we will provide expertise and interoperability, enabling the development of new AI tools to support healthcare providers. Furthermore, this quarter, we announced a five-year collaboration with Microsoft to enhance digital healthcare across North America, integrating Microsoft's cloud and AI with WELL's platform.

Speaker Change #125: On July 10, 2024, we announced the approval of a historic $44 million project, Health Compass to the largest digital supercluster project ever awarded in advance.

Speaker Change #125: to advance.

Speaker Change #126: AI PowerTech enablement for care providers. This initiative led by Well and its consortium partners aims to enhance AI and interoperability in Canadian healthcare. As a lead commercialization partner and first customer, we will provide expertise and interoperability, enabling the development of new AI tools to support healthcare providers.

Hamed Shahbazi: Furthermore, this quarter, we announced a five-year collaboration with Microsoft to enhance digital health care across North America, integrating Microsoft's cloud and AI with WELL's platform. This partnership focuses on elevating WELL's scalability and operational efficiency, aiming to transform health care delivery for large enterprises, including the public sector. Collaboration will also modernize WELL's cloud infrastructure, optimized costs, Secure data and integrate Azure OpenAI service to advance healthcare solutions. Before closing, I want to talk about our pasted control investment with healwellia. When WELL co-founded Kill WELL AI just 10 months ago, its revenues were less than $10 million.

Speaker Change #126: Furthermore, this quarter we announced a five-year collaboration with Microsoft to enhance the

Speaker Change #127: Digital Healthcare Across North America, integrating Microsoft's cloud and AI with Wells platform. This partnership focuses on elevating Wells scalability and operational efficiency, aiming to transform healthcare delivery for large enterprises including the public sector.

Hamed Shahbazi: This partnership focuses on elevating well-scale ability and operational efficiency, aiming to transform healthcare delivery for large enterprises, including the public sector. The collaboration will also modernize WELL's cloud infrastructure, optimize costs, secure data, and integrate Azure Open AI Service to advance healthcare solutions.

Eva Fong: Looking forward in 2024, our current expectations is that our earnout payments will further decline by another 20% to approximately 23.5 million, resulting in share the solution of around 3.3% in 2024. As you can see, most of that has already been incurred and we're only expecting a 30.6% solution for the balance of the year.

Speaker Change #128: The collaboration will also modernize WELL's cloud infrastructure, optimize costs, secure data, and integrate Azure OpenAI service to advance healthcare solutions.

Hamed Shahbazi: Before closing, I want to talk about our pasted control investment with Heelwell AI. When WELL co-founded Heelwell AI just 10 months ago, its revenues were less than $10 million. The company now has just died of 400 employees and has surpassed a $65 million revenue run rate, as even mentioned earlier, and has provided guidance to approach $100 million by the end of the year, setting the stage for being profitable in 2025, which will be just in time for us to complete our pasted control. The company has significantly improved this balance sheet as just this past quarter between reductions in liabilities and you capital injected, there was $43 million of positive impact to its balance sheet.

Eva Fong: Our largest remaining major earnouts pertain to ocean, doctor care, and my health as we have not committed to a new material earnout arrangement since 2021. As you can see, next year, we'll have a 10 million dollars decline in performance earnouts payable and then again a major drop of another 10 million dollars down to a very small amount in 2027. Please keep in mind that our performance earnouts are tied to performance so we would only be paying these projected figures. It's assets such as my health, ocean, and doctor care continue to perform which we expect will be the case.

Speaker Change #129: Before closing I want to talk about our path to control investment with HealWell AI.

Speaker Change #130: When WELL co-founded HealWell AI just 10 months ago, its revenues were less than $10 million. The company now has just shy of 400 employees and has surpassed a $65 million revenue run rate, as even mentioned earlier.

Hamed Shahbazi: The company now has just over 400 employees and has surpassed a $65 million revenue run rate, as Eva mentioned earlier, and has provided guidance to approach $100 million by the end of the year, setting the stage for being profitable in 2025, which will be just in time for us to complete our path to control. The company has significantly improved its balance sheet. Just this past quarter, between reductions in liabilities and new capital injected, there was $43 million of positive impact to its balance, More importantly, the company has established itself as a leader in leveraging artificial intelligence to unlock the value of data for two key audiences. Healthcare workers who need co-pilot technologies to better detect disease and pharmaceutical companies who need better real-world evidence and improvements to their research and development processes, leading to better clinical trials orchestration.

Speaker Change #131: and has provided guidance to approach $100 million by the end of the year, setting the stage for being profitable in 2025, which will be just in time for us to complete our path to control.

Speaker Change #132: The company has significantly improved this balance sheet as just this past quarter between reductions in liabilities and new capital injected, there was $43 million of positive impact to its balance sheet.

Hamed Shahbazi: More importantly, the company has established itself as a leader in leveraging artificial intelligence to unlock the value of data for two key audiences: healthcare workers who need co-pilot technologies to better detect disease and pharmaceutical companies who need better real-world evidence and improvements to their research and development processes, leading to better clinical trials or orchestration. In fact, Heelwell is starting to do for CR Rose or clinical research organizations what WELL has been doing for healthcare clinics, which is to modernize and digitize them. This is a trend that we believe will drive the company to hundreds of millions of dollars in revenue.

Speaker Change #132: More importantly, the company has established itself as a leader in leveraging artificial intelligence to unlock the value of data for two key audiences.

Speaker Change #132: health care workers who need co-pilot technologies to better detect disease and pharmaceutical companies who need better real-world evidence and improvements to their research and development processes leading to better clinical trials orchestration.

Hamed Shahbazi: In fact, you'll be well on your way to doing for CR Rose or clinical research organizations what WELL has been doing for health care clinics, which is to modernize and digitize them. This is a trend that we believe will drive the company to hundreds of millions of dollars in revenues and significant profits in the coming years.

Speaker Change #133: In fact, HealWell is starting to do for CROs, or Clinical Research Organizations, what Well has been doing for healthcare clinics, which is to modernize and digitize them. This is a trend that we believe will drive the company to hundreds of millions of dollars in revenues.

Eva Fong: In terms of our share capitalization, as you can see, well actually reduced its fully diluted shares outstanding in Q2 2024. This is because we paid out all our time-based earnouts in cash and did not issue any new incentive shares in Q2 and well also purchased and returned 119,000 shares to tertiary in Q2 2024. Last year doing Q2 2023, we had issued about 389,000 shares for acquisitions and earnout payments. Following along with the focus of reducing share dilution, as of the end of Q2 2024, the company has used its approved NCID to repurchase 133,000 and 500 shares at an average price of $3.83. Our repurchases are methodical and continues as we believe that they demonstrate a keen focus on managing and reducing share dilution.

Hamed Shahbazi: and significant profits in the coming years. Hill WELL's DRO has already served more than 250 pharmaceutical clients. When one starts to combine the ability for Hill WELL AI to find patients and support the pharmaceutical industry with the next generation patient-finding technology, with the vast network of clinical data at Well, together we have something truly valuable and globally relevant. We're pleased to remind shareholders that WELL has a call option on 30 million multivoting shares of Hill WELL, which will give WELL voting control over the company when exercised. We anticipate doing this at some point in time in 2025.

Speaker Change #133: and significant profits in the coming years.

Speaker Change #133: Yale Wealth CRO has already served more than 250 pharmaceutical clients.

Hamed Shahbazi: When one starts to combine the ability for HealWell AI to find patients and support the pharmaceutical industry with the next generation patient finding technology. With the vast network of clinical data at WELL, together we have something truly valuable and globally relevant. We're pleased to remind shareholders that WELL has a call option on 30 million multi-voting shares of HealWell, which will give WELL voting control over the company when experts, We anticipate doing this at some point in time in 2025.

Speaker Change #134: When one starts to combine the ability for HealWell AI to find patients and support the pharmaceutical industry with the next generation patient finding technology with the vast network of clinical data at Well, together we have something truly valuable and globally relevant.

Speaker Change #135: We're pleased to remind shareholders that WELL has a call option on 30 million multi-voting shares of HealWell, which will give WELL voting control over the company when exercised.

Hamed Shahbazi: HealWell will continue to operate as a standalone public company, but we will then add all of HealWell's top and bottom line activity to WELL's IFRS statements. We look forward to this. In summary, we're very pleased with our financial performance thus far in 2024 and look forward to delivering strong results for the remainder of the year. Our outlook remains very positive, hence we are improving our guidance to previously noted. We have a committed and disciplined team to ensure we can execute on our objectives, including our very important strategic initiatives designed to realize some of PARCC's value, which we believe is central to our plan to drive shareholders.

Hamed Shahbazi: Hill WELL will continue to operate as a standalone public company, but we will then add all of Hill WELL's top and bottom line activity to WELL's IFRS statements. We look forward to this.

Speaker Change #136: We anticipate doing this at some point in time in 2025. Healwell will continue to operate as a standalone public company, but we will then add all of Healwell's top and bottom line activity to Wells IFRS statements. We look forward to this.

Hamed Shahbazi: In summary, we're very pleased with our financial performance thus far in 2024 and look forward to delivering strong results for the remainder of the year. Our outlook remains very positive; hence, we are improving our guidance as previously noted. We have a committed and disciplined team to ensure we can execute on our objectives, including our very important strategic initiatives designed to realize some of parts value, which we believe is central to our plan to drive shareholder value.

Eva Fong: Our intent is to continue to repurchase shares in the coming months and to the extent our strategic alternative processes yield additional cash resources. We will undertake to increase our buyback rates as the company's board of directors believes world's current share price does not restrict the underlying value based on world's business prospects and financial positions.

Speaker Change #137: In summary, we're very pleased with our financial performance thus far in 2024 and look forward to delivering strong results for the remainder of the year. Our outlook remains very positive, hence we are improving our guidance as previously noted.

Speaker Change #138: We have a committed and disciplined team to ensure we can execute on our objectives, including our very important strategic initiatives designed to realize sum of parts value, which we believe is central to our plan to drive shareholder value.

Hamed Shahbazi: Finally, I want to thank you all for joining us on this call and joining us on this journey. We're thrilled that we get a chance to speak to you and do our best to deliver shareholder value. We're confident that with your support, we will be successful together. I would like to thank well senior management team and all our employees and contractors for their tremendous effort in particular. I'd like to thank our team of healthcare providers and other frontline workers who provide unbelievable patient care. They're the true heroes of our business and it's our honor to support. And with that, we'd be pleased to take some questions. Operator?

Eva Fong: Looking at a balance sheet at the end of Q2 2024, WELL and the Q2 2024 with a solid balance sheet. As at June 30, 2024, WELL had cash and cash decoupling of 46.5 million dollars. WELL continues to be in disstanding and fully compliance with all covenants related with its two credit lines, JB Morgan in the US and WELL Bank in Canada. The debt from the Q2 credit lines was approximately 289 million in Canadian dollars as of June 30, 2024.

Speaker Change #138: Finally, I want to thank you all for joining us on this call and joining us on this journey. We're thrilled that we get a chance to speak to you and do our best to deliver shareholder value. We're confident that with your support, we will be successful together.

Hamed Shahbazi: I would like to thank WELL's senior management team and all our employees and contractors for their tremendous effort. In particular, I'd like to thank our team of healthcare providers and other frontline workers who provide unbelievable patient care. They're the true heroes of our business, and it's our honor to support them.

Speaker Change #139: I would like to thank WELL's senior management team and all our employees and contractors for their tremendous effort. In particular, I'd like to thank our team of healthcare providers and other frontline workers who provide unbelievable patient care. They're the true heroes of our business, and it's our honor to support them.

Operator: And with that, we'd be pleased to take some questions, Operator.

Eva Fong: Looks like the US dollar did strengthen during the period, so it's important to note that we were able to reduce our US debt facility from US 162.3 million to US 148.8 million during the quarter. WELL's shareholder leverage ratio was 2.67 times as at the end of Q2 2024 compared to 2.75 times as at the end of Q1 2024. We define leverage ratio as net bank debt, let's cash on hand, divided by a shareholder adjust that you deduct. On a constant currency basis, our leverage ratio was 2.65 times. No day in one includes our convertible debentures which are turned out for more than two years, our leverage ratio would be approximately 3.45 times.

Speaker Change #139: And with that, we'd be pleased to take some questions. Operator?

Operator: Thank you, ladies and gentlemen. We will now begin the question and answer session. Should you wish to ask a question, please press star one on your telephone, Kipad. And should you wish to cancel your request, please press star two.

Operator: Thank you, ladies and gentlemen. We will now begin the question and answer session. Should you wish to ask a question, please press star 1 on your telephone keypad, and should you wish to cancel your request, please press star 2.

Speaker Change #140: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you wish to ask a question, please press star 1 on your telephone keypad. And should you wish to cancel your request, please press star 2. Your first question comes from the line of Rob Goff from Benton. Please go ahead.

Michael Freeman: Your first question, constant and line of prop golf from Ben-Tum, please go ahead. Thank you very much for taking my question, and congratulations on the quarter. A lot was in there. Thank you, Rob.

Operator: Your first question comes from the line of Rob Goff from Bentham. Please go ahead. Thank you very much for taking my question and congratulations on the quarter. A lot was in there. Thank you, Ron. Please, please, please speak with you.

Prop Golf: Thank you very much for taking my question and congratulations on the quarter. A lot was in there.

Hamed Shahbazi: Please, please speak with you. Perhaps, I'm sure there'll be a lot of questions on circle. Can you perhaps talk to the ramp up in growth because I know from your release that July I saw a year-of-year growth of 65% versus 53 on the quarter, and perhaps could you dive into the impact of the plans for the hires and the partnerships within that? Yeah, look, I mean last year, we had made a significant number of investments, as you may remember. It did affect our EBITDA. In fact, this past quarter, when you look at the comparatives in the year before, there's a stark difference in terms of not only growth rate, but also profitability.

Hamed Shahbazi: Perhaps there will be a lot of questions on circle. Can you perhaps talk to the ramp up in growth? Because I know from your release that July saw year-of-year growth of 65% versus 53 on the quarter.

Speaker Change #142: Thank you Rob, pleased to speak with you.

Speaker Change #142: No, I don't think so [inaudible]

Speaker Change #143: Perhaps, and if you'll be a lot of questions on Circle, can you perhaps talk to the ramp up in growth?

Rob: I know from your release that July saw year-of-year growth of 65% versus 53 on the quarter, and perhaps could you dive into the impact of the, or the plans for the hires and the partnerships within that?

Eva Fong: Given access to trajectory of improved EBITDA and capital efficiency, we are projecting improvements to our leverage ratio over the next couple of course.

Hamed Shahbazi: And perhaps could you dive into the impact of the or the plans for the hires and the partnerships within that? Yeah, look, I mean, last year, you know, we had we had made a significant number of investments, as you may remember, it did affect our EBITDA. In fact, this is a this this past quarter, when you when when you look at the comparatives in the year before, there's a stark difference in terms of not only growth rate, but also profitability.

Rob: Yeah, look, I mean, last year, um...

Speaker Change #145: We had made a significant number of investments. As you may remember, it did affect our EBITDA. In fact, this past quarter, when you look at the comparatives in the year before, there's a stark...

Eva Fong: Lastly, one housekeeping item before I turn the call back to Connor. I wanted to provide some additional commentary on the build up in our accounts receivable balance. As we noticed previously, the CLH and the CCA business has experienced delays in cash collections on an CCA claim, including delay billing and as a result of its billing partner change healthcare. Who is experiencing a cyber security incident in February 2024? CLH has continued to provide in the CCA services due to due outage.

Hamed Shahbazi: So Circle, not only surge in profitability and some margin expansion, but it was also able to see a lot of that fall to the bottom line. So we're very pleased with that. Again, there was just a lot of work that we did this past year in making investments in the company's technology. We also invested in a clinical network that was costly, in time consuming, and just a heck of a lot of work to stand up. But it's there now, and we are a hybrid care provider, which, and not just a pure telemedicine provider, which I think is incredibly important.

Speaker Change #145: Um...

Hamed Shahbazi: So Circle not only surging profitability and some margin expansion, but it was also able to see a lot of that fall to the bottom line. So we're very pleased with that. Again, there was just a lot of work that we did this past year and making investments in the company's technology. We also invested in a clinical network that, you know, was was was costly and time consuming and and and just a heck of a lot of work to stand up. But it's there now.

Speaker Change #146: difference in terms of not only growth rate but also profitability. So circle not only surge in profitability in some margin expansion

Speaker Change #146: but it was also able to see a lot of

Speaker Change #147: We're very pleased with that. Again, there was just a lot of work that we did this past year in making investments in the company's technology.

Speaker Change #147: We also invested in a clinical network.

Eva Fong: And as a result, accounts receivable relating to these claims has increased. Understanding the consequences business interruption this has caused, change healthcare has provided advanced funding to CLH. In lieu of the cash collection, CLH would normally receive related to these claims with the expectation that upon resuming normal billing and collection activities, the advanced funding would be repay as cash collections from payers and patients are received. Given the contractual terms underlying the advanced funding received, these funds have been recorded within other liabilities as June 30th, 2024, totaling US$58 million. Hence the related increase in other liabilities during the quarter, which offset the increase in accounts receivable.

Speaker Change #148: that was costly and time-consuming and just a heck of a lot of work to stand up. But it's there now, and we are a hybrid care provider, and not just a pure telemedicine provider, which I think is incredibly important.

Hamed Shahbazi: And we are a hybrid care provider, which and not just a pure telemedicine provider, which I think is incredibly important. So, yeah, we're very, you know, we're very optimistic for the future. And the company just has always been very strong in technology. They have a very, you know, we kind of refer to them as a full stack primary care company. They're they're very much an advanced technology company. They've essentially built their own EMR minus the billing components. So there's just a lot there. And I think their ability to execute on A.I.

Hamed Shahbazi: So, yeah, we're very optimistic for the future, and the company has always been very strong in technology. They have a very, we kind of refer to them as a full stack primary care company. They're very much an advanced technology company. They've essentially built their own EMR minus the billing components. So there's just a lot there, and I think their ability to execute on AI will be noteworthy. So, yeah, we're quite excited, especially as we start to consider stupidical stakeholders for cerebral medical. We believe they're trending at the right time.

Speaker Change #148: So yeah, yeah, we're very, you know, we're very optimistic for the future and

Speaker Change #148: The company has always been very strong in technology. They have a very, we kind of refer to them as a full stack primary care company. They're very much an advanced technology company. They've essentially built their own EMR.

Hamed Shahbazi: will be noteworthy. So, yeah, we're we're quite excited, especially as we start to consider strategic alternatives for circle medical. We believe they're trending at the right time. And if I could, on the SaaS and service provider solutions, the consideration of spinning out a non-control position, I think it does both for surfacing value within the sum of the parts, but also it establishes a currency, where I presume there are a number of acquisition candidates out there. Yeah, you nailed it, Rob.

Speaker Change #149: There's just a lot there, and I think their ability to execute on AI will be noteworthy. So, yeah, we're quite excited, especially as we start to consider strategic alternatives for Circle Medical. We believe they're trending at the right time.

Tyler Baba: That is my financial update and I turn the call back over to Hannah.

Hamed Shahbazi: And if I could, on the fast and service provider solution, the consideration of spinning out a non-control position, I think it has both for surfacing value within the some of the parts, but also it establishes the currency where I presume there are a number of acquisition candidates. Yeah, you nailed it, Rob. You know, if you look at how we built our staff and services division, you know, it was through a number of different acquisitions. We consolidated a kind of a cottage industry of Oscar service providers, and we've integrated those successfully. And this business is operating incredibly well. When you look at the financial profile, we describe to the company in terms of growth, profitability, and we have not made any material acquisition in quite some time.

Hamed Shahbazi: Thank you, Eva. Performance of our Canadian patient services business has been exceptionally strong, generating $76.7 million in revenue, include to 2020, for, and increase of 42% from U2 2023 and is ahead of our previous guidance of achieving $300 million in revenue in 2024.

Speaker Change #150: And if I could, on the SaaS and service provider solutions, the consideration of spinning out a non-control position, I take it that's both for surfacing value within the sum of the parts, but also it establishes a currency where I presume there are a number of acquisition candidates out there?

Hamed Shahbazi: You know, if you look at how we built our staff and services division, you know, it was through a number of different acquisitions. We consolidated a kind of a cottage industry of Oscar service providers, and we've integrated those successfully. And this business is operating incredibly well. When you look at the financial profile, we describe to the company in terms of growth profitability. And we have not made any material acquisition in quite some time.

Speaker Change #150: Yeah, you nailed it, Rob.

Hamed Shahbazi: Let's first look at the primary care segment as part of our patient services group. The company's primary care business unit generated revenue of $45.5 million in Q2 2024 and increase of 83% compared to Q2 2023. This increase relates primarily to the acquisitions of MCI Ontario and Alberta-based medical clinic and the large Manitoba clinic as well as strong organic growth in existing clinics, including the impact from clinic absorptions over the past 12 months.

Speaker Change #151: You know, if you look at how we built our SAS and services division, you know, it was through a number of different acquisitions. We consolidated a kind of a cottage industry of, of, of, of, of Oscar service providers, and we've integrated those successfully.

Speaker Change #152: And this business is operating incredibly well. When you look at the financial profile we described of the company in terms of growth profitability, and we have not made any material acquisition in quite some time. And so given the prospects that this company has, given...

Hamed Shahbazi: And so given the prospects that this company has given, given also just, you know, the scarcity value of having an asset like this on the Canadian capital markets, we think that it it generates a lot of momentum, likely results in significant, you know, value increases, well creating new currency that will benefit not only well health, but also it's ongoing business. So, you know, we're very pleased at this. And currently putting together an architecting the plan, Thank you, and congrats. Thank you. Thank you.

Hamed Shahbazi: And so, given the prospects that this company has given, given also just, you know, the scarcity value. We've having an asset like this on the Canadian capital markets; we think that it generates a lot of momentum, likely results in significant value increases, well creating new currency that will benefit not only well health, but also its ongoing business.

Hamed Shahbazi: We are now very closely watching our 2023 cohort of clinic absorptions and acquisitions. Included in the 2023 cohort is the large Manitoba clinic and the MCI Ontario clinics. Recall these clinics were not profitable and caused downward pressure on our EBITDA margins in Q4 of 2023. I'm proud to announce that the digitization and transformation efforts at these clinics is running ahead of plans, and as of today both Manitoba Clinic and MCI Ontario clinics are running at positive adjusted EBITDA.

Speaker Change #153: Given also just, you know, the scarcity value of having an asset like this on the Canadian capital markets, we think that it generates...

Speaker Change #154: A lot of momentum likely results in significant value increases, as well as creating new currency that will benefit not only WELL Health, but also its ongoing business. So we're very pleased at this and currently putting together and architecting the plan and establishing timing.

Hamed Shahbazi: So, you know, we're very pleased at this and currently putting together an architecting the plan and establishing timing.

Hamed Shahbazi: Thank you.

Speaker Change #155: Thank you and congrats!

Hamed Shahbazi: Going forward, we expect to continue to increase EBITDA margins of these clinics over the next year. Our outlook for primary care continues to look strong for the third quarter and beyond, notwithstanding the transformation and digital digitization work that we are doing on the acquired shoppers drug mark clinics, which have had a temporary negative impact on our P&L. As we go through the process of digitizing and modernizing these clinics, we expect them to become profitable in 2024.

Hamed Shahbazi: And your next question comes in the line of Michael Freeman from Raymond James, Hi, I'm Eva and Tyler. Thanks very much for taking the questions and your thoughts on a really strong quarter. I'm going to ask another question on the plan to spin off the provider services business. I wonder if you could update us on, you know, potential timelines and progress down this path, for instance, like are there revenue thresholds that you'd like to surpass before undertaking this and like I recognize that you would be potentially going public with a non-controlling, you know, float out there.

Michael Freeman: And your next question comes in the line of Michael Freeman from Raymond James. Please go ahead.

Speaker Change #155: Thank you.

Speaker Change #156: Thank you, and your next question comes from the line of Michael Freeman from Raymond James,

Michael Freeman: Hi, I'm Eva and Tyler. Thanks very much for taking the questions and your thoughts on a really strong quarter.

Speaker Change #157: Hi Hamed, Eva, and Tyler. Thanks very much for taking the questions and congrats on a really strong quarter.

Michael Freeman: I'm going to ask another question on the plan to spin off the provider services business. I wonder if you could update us on, you know, potential timelines and progress down this path. For instance, like are there revenue thresholds that you'd like to just pass before undertaking this? And like I recognize that you would be potentially going public with a non-controlling float out there. What risks do you see in spinning this out given that these provider services provide sort of the backbone to Wells, you know, Wells' core business of Canadian clinics.

Speaker Change #158: I'm going to ask another question on the plan to spin off the provider services business. I wonder if you can update us on...

Speaker Change #159: Potential timelines and progress down this path, for instance, like

Hamed Shahbazi: And in fact, we are ahead of plan with our work as we are almost at break even at these clinics. Note that we have owned them for less than 100 days and when we purchased them, they were significantly negative. So we're very pleased at the progress that we've made here.

Speaker Change #160: Are there revenue thresholds that you'd like to surpass before undertaking this? And I recognize that you would be potentially going public with a non-controlling float out there.

Hamed Shahbazi: What risks do you see in spinning this out given that these provider services provide sort of the backbone to WELL's core business of Canadian clinic? Yeah, Michael, thanks for the question. I tried to answer some of that proactively in my script, but because of the strong, You know, control that we will exercise on a controlled public company. We, you know, we don't really see any, any changes that would, that would occur operationally.

Speaker Change #161: What risks do you see in spitting this out, given that these provider services provide sort of the backbone to Wells, you know, Wells Corps business of Canadian clinics?

Hamed Shahbazi: I will reiterate that we believe primary care will maintain strong absolute and organic growth through 2024 and beyond. Our recruitment absorption and M&A pipelines are very strong and have more than 50 clinics in various stages of pre-LYDD, LY and post-LYDD. We believe this is directly correlated with the challenges doctors are feeling in the marketplace and well as growing brand recognition and ability to execute.

Hamed Shahbazi: Yeah, Michael, thanks for the question. I tried to answer some of that proactively in my script, but because of the strong, you know, control that we will exercise on a controlled public company. You know, we don't really see any changes that would occur operationally. All of our relationships from an intercompany perspective today already have intercompany agreements. Those intercompany agreements would endure, so nothing would change there. You know, we effectively see our, we've always seen our clinics as being kind of customer number one for our platform and provider solutions group that would continue.

Speaker Change #162: Yeah, Michael, thanks for the question. I tried to answer some of that proactively in my script, but because of the strong

Hamed Shahbazi: All of our relationships from an intercompany perspective today already have intercompany agreements. Those intercompany agreements would, would, would, would endure. So nothing would change there.

Speaker Change #163: You know control that we will exercise on a controlled public company

Speaker Change #164: We, you know, we don't really see any changes that would occur operationally. All of our relationships from an intercompany perspective today already have intercompany agreements.

Hamed Shahbazi: Now a few words about well health diagnostic centers. Well health diagnostics had a very strong Q2 2024 achieving a total of 172,000 patient visits and record quarterly revenue of 31.2 million an increase of 7% compared to Q2 2023. Q2 has historically been and continues to be our strongest quarter in this line of business. This performance was driven by organic growth from the expansion of services as well and healthcare providers. We note that both adjusted growth margin and adjusted EBITDA as a percentage of revenue decrease compared to the same quarter in the prior year due to the higher than normal EBITDA in the second quarter of 2023 as a result of higher diagnostic consultations in our high margin nuclear medicine line of business and availability of materials, and lower direct costs due to stock incentives provided to physicians who are urinal partners of the company, which also occurred in Q2 2023.

Speaker Change #165: Those intercompany agreements would endure, so nothing would change there. We effectively see our – we've always seen our clinics as being kind of customer number one.

Hamed Shahbazi: You know, we effectively see our, we've always seen our clinics as being kind of customer number one for, for our platform and provider solutions group, that would continue. Right now, from a timing perspective, we are thinking of H1 2025. So it's not that long from now. We believe based on some of the organic growth and M&A activity that we're looking at, that it's likely that 2025 will be a $50 plus million revenue business for this segment.

Hamed Shahbazi: Right now, from a timing perspective, we are thinking of H1 2025. So, it's not that long from now. We believe, based on some of the organic growth and M&A activity that we're looking at, that it's likely that 2025 will be a 50-plus million dollar revenue business for this segment. And if you kind of look at the growth and the profitability, I mean, this is right now a rural 50 plus company, but I think this can be a reliably rural 40 plus company for quite some time.

Speaker Change #166: for our platform and provider solutions group, that would continue. Right now, from a timing perspective, we are thinking of H1 2025.

Speaker Change #167: So, it's not that long from now. We believe, based on some of the organic growth and M&A activity that we're looking at, that it's likely that 2025 will be a $50-plus million revenue period.

Hamed Shahbazi: And if you kind of look at the growth and the profitability, I mean, this is right now a rural 50 plus company, but I think this can be a reliably profitable 40 plus company for quite some time. Okay.

Speaker Change #168: Business for this segment. And if you kind of look at the growth and the profitability, I mean this is right now a rule of 50 plus companies, but I think this can be a reliably rule of 40 plus company for quite some time.

Hamed Shahbazi: Second quarter is seasonally our strongest quarter, which is followed by a slower third quarter. For the full year 2024, we are expecting that our well-health diagnostic centers to achieve another year of record revenue in EBITDA. In addition, cancer care Ontario has decreased the eligibility age of breast cancer screening from 50 to 40 years of age, which comes into effect in the fall of 2024. This should result in a material increase in demand in mammography screening and overall improvement in Ontario patient care in Q4.

Michael Freeman: Okay, thanks very much.

Hamed Shahbazi: And then if I could ask one more question. [inaudible] I guess. We noticed that there is a legal matter regarding WISP that resulted in a in a settlement subsequent to the quarter. I wonder if you could provide a bit of detail on that, and also, I guess, if we can expect any further actions of this settlement to conclude the matter, and I wonder how this legal matter factored into the ongoing strategic process for WISP. Yeah, thanks for asking.

Michael Freeman: And then, if I could ask one more question.

Michael Freeman: The two's question. I guess we notice that there is a legal matter regarding WISP that resulted in a settlement subsequent to the quarter. I wonder if you could, you could provide a bit of detail on that. And also, I guess, if we can expect any further actions of this settlement, it concluded the matter. And I wonder how this legal matter factored into the ongoing strategic process for WISP. Yeah, thanks for asking. Yeah, we're really pleased to have resolved the pixel matter. We have settled both the class action and the mass arbitration items, and we will have almost the vast majority of that covered by insurance.

Speaker Change #168: P.

Hamed Shahbazi: Let me choose the question. I guess...

Hamed Shahbazi: We noticed that there is a...

Speaker Change #169: A legal matter regarding WISP that resulted in an estimate subsequent to the quarter.

Speaker Change #170: I wonder if you could provide a bit of detail on that and also, I guess, if we can expect any further actions or if the settlement concluded the matter. And I wonder how this legal matter factored into the ongoing strategic process.

Hamed Shahbazi: In terms of M&A, we continue to have strong discussions with various players in the industry with the hopes and intentions of expanding our diagnostic centers to more provinces and sites in 2024, as well as in Ontario.

Hamed Shahbazi: Yeah, we're really pleased to have resolved the PIXL matter. We have settled both the class action and the master arbitration items, and we will have, Almost the vast majority of that covered by insurance, we're currently finalizing our discussions there. So ultimately, any portion that's not covered by that should be fairly fairly small and inconsequential to with finances.

Speaker Change #171: Four West

Hamed Shahbazi: I'll now discuss our US businesses. First, WELL Health USA, which includes CRH and provider staffing. WELL USA increased revenue in Q2 2024 to 93.3 million compared to 63.4 million in Q2 in the previous year. Last year's EBITDA included 4.7 million in revenue directly related with divestment related impact. If one were to adjust, Eva had referenced this in her script. If one were to adjust for this, adjusted EBITDA would have increased 7% to 19.6 million.

Speaker Change #172: Yeah, thanks for asking. Yeah, we're really pleased to have resolved the PIXUL matter. We have settled both the class action and the master arbitration items and we will have...

Speaker Change #172: Almost

Hamed Shahbazi: We're currently finalizing our discussions there. So ultimately, any portion that's not covered by that should be fairly, fairly small and inconsequential to with finances. So that's a real big win. We're very happy about that. Our legal and compliance teams did a great job.

Speaker Change #173: The vast majority of that is covered by insurance. We're currently finalizing our discussions there. Ultimately, any portion that's not covered by that should be fairly small and inconsequential with finances.

Speaker Change #174: So that's a real big win. We're very happy about that. Our legal and compliance teams did a great job.

Hamed Shahbazi: CRH has completed the first half of the year now with a full year of integration and operations following the July 2023 acquisition of care plus management. You will recall care plus included the traditional practice of anesthesia serving 14 locations. These have now been fully integrated and operate under CRH anesthesia care plus management also included the radar provider staffing business, which is a premier and trusted staffing and local tenants business specializing in anesthesia across the lower 48 states.

Hamed Shahbazi: You know, this was not really a factor in our strategic alternatives. You know, we believe Circle and WISP are both great businesses with fantastic prospects. You know, they're growing organically. They're profitable. They have excellent scalability prospects, and we don't need to sell them or consider strategic alternatives for them. But we believe that it makes sense to really go out there and see what opportunities are there in light of the call option processes that we have this year that will likely conclude in the next 12 months. So that was really more what was driving these strategic alternatives as opposed to any kind of legal matter.

Hamed Shahbazi: So that's a real big win. We're very happy about that. This was not really a factor in our strategic alternatives.

Speaker Change #174: You know, this was not really a factor in our strategic alternatives.

Hamed Shahbazi: You know, we believe circle and whisper both great businesses with fantastic prospects. You know, they're growing organically, they're profitable. They have excellent scalability prospects and we don't need to sell them or consider strategic alternatives for them. But we believe that it makes sense to really go out there and see what opportunities are there in light of the call option processes that we have this year that will likely conclude in the next 12 months.

Speaker Change #175: You know, we believe circling with for both great businesses with fantastic prospects, you know, they're growing organically, they're profitable.

Speaker Change #175: They have excellent scalability prospects and we don't need to sell them or consider strategic alternatives for them.

Speaker Change #175: But we believe that it makes sense to really go out there and see what opportunities are there in light of the call option processes that we have this year that will likely conclude in the next 12 months.

Hamed Shahbazi: The business continues to be extremely complimentary to CRH's legacy anesthesia business and provides high revenue growth along with many operating synergies. We expect growth of this segment to continue with an anesthesia as well as our plans to expand to other health care specialties. Due to health insurance and pair mixed gifts along with patient deductibilities deductibles pardon me generally being met in the last half of the year.

Hamed Shahbazi: So that was really more what was driving these strategic alternatives as opposed to any kind of legal matter. But yeah, I'm glad you brought it up, because it is a great development that we were able to settle those matters in an advantageous manner. Thanks, Hamed. I'll pass it on.

Speaker Change #176: So that was really more what was driving these strategic alternatives as opposed to any kind of legal matter. But yeah, I'm glad you brought it up because it is a great development that we were able to settle those matters.

Hamed Shahbazi: But yeah, I'm glad you brought it up because it is a great development that we were able to, you know, settle those matters that are in an advantageous manner. Thanks, Ahmed.

Hamed Shahbazi: We expect both growth and profitability to accelerate in the second half of the year in line with our seasonal norms. And now for circle medical where growth accelerated in Q2 circles revenue surged to $32 million in Q2 2024 an increase of 53% compared to Q2 2023. It's important to note that we're seeing this along with margin expansion which is generally not what our competitors are seeing in the industry. Growth margins grew by 500 basis points from 49.4 to 54.4% on a year-over-year basis.

Hamed Shahbazi: I'll pass it on here.

Speaker Change #176: in an advantageous manner.

Christian Sgro: Thank you. And your next question comes in the line of Christian Cigarot from 8th Capitol. Please go ahead. Okay, good afternoon, and thanks for taking my questions. When we think about the dive estimates of U.S. telehealth businesses and now, you know, maybe the provider solution spin out. What do you think would be the key use of proceeds for the business? And you know, if it is that repayment, comment and you get down below a ratio you're comfortable with, you know, at that point, under the core wall business, would you get more inquisitive? Would you invest more in growth?

Operator: Thank you, and your next question comes in the line of Christian Sgro, from 8th Capitol, please go ahead. Hey, good afternoon, and thanks for taking my question. When we think about the divestment. US, Total Health Businesses, and now maybe the Provider Solution spin-out. What do you think would be the key use of proceeds for the business? And you know, if it is debt repayment, Comment and you get down below a ratio you're comfortable with.

Speaker Change #176: Thanks Hamed, I'll pass it on here.

Speaker Change #177: Thank you, and your next question comes in the line of Christian Sigro from 8 capital, please go ahead.

Speaker Change #178: Hey, good afternoon and thanks for taking my questions.

Speaker Change #178: When we think about the divestments...

Speaker Change #179: U.S. telehealth businesses, and now, you know, maybe the provider solution spin out.

Speaker Change #180: What do you think would be the key use of proceeds for the business and you know if it is debt repayment how many you get down below a ratio you're comfortable with?

Hamed Shahbazi: You know, at that point, under the core wall business, would you get more inquisitive, would you invest more in growth? Like, what do you see as the plan? You know, you're out from now and things have been sold, they're wrong on the other side of some of these turns out. Yeah, thanks, Christian. Good question.

Speaker Change #181: At that point, under the core WELL business, would you get more acquisitive? Would you invest more in growth? Like, what do you see as the plan a year out from now when things have been sold or we're on the other side of some of these transactions?

Hamed Shahbazi: Like, what do you see as the plan, you know, you're out from now and things have been sold or wrong to the side of some of these transactions? Yeah, thanks, Christian. Good, good question. I'm referencing a little bit in the script, but look beyond debt repayments and potential special buyback. You know, we do have a pipeline of acquisitions that we've liked that we sort of put to the side for now that is a bit bigger than we would like to prosecute with our current cash reserves. You know, as you know, as I'm sure everyone can tell by this presentation, we're just very, very focused on running a very tight ship as it relates to dilution, so we don't want to necessarily increase our debt.

Hamed Shahbazi: Comparatively if you look at Teladog for example they're citing higher customer acquisition costs which is putting pressure on their margins while circle medical is experiencing lower customers. Acquisition Cost. Circles, organic growth was driven by strong patient acquisition, coupled with an expansion of its provider network, which now consists of 547 medical providers. Looking beyond Q2, the future looks bright. You may have seen that we released a corporate update specifically to update shareholders on Circle Medical yesterday, and it the company announced that its revenue in July was a record $8.87 million USD, representing more than 60% increase compared to the same month last year.

Hamed Shahbazi: Reference it a little bit in the script, but look beyond that repayments and potential special bye-bye. Well, we do have, a pipeline of acquisitions that we've sort of put to the side for now that is a bit bigger than we would like to prosecute with our current cash reserves. As I'm sure everyone can tell by this presentation, we're just very, very focused on running a very tight ship as it relates to dilution. So we don't want to materially increase our debt.

Speaker Change #182: Yeah, thanks, Christian. Good question. Reference it a little bit in the script, but look beyond that repayments and potential special buyback.

Speaker Change #182: We do have-

Speaker Change #183: A Pipeline

Speaker Change #184: of acquisitions that we've put to the side for now that is a bit bigger than we would like to prosecute with our current cash reserves. As I'm sure everyone can tell by this presentation, we're just very, very focused on

Hamed Shahbazi: We believe that rates are likely to come down. So that will be an influence as that occurs. But there are, as this cash becomes available, we believe that we'll be able to reallocate it in extremely creative fashion in the Canadian health care landscape. Keep in mind right now, we're acquiring, you know, the lowest cost assets that we can find that makes sense for where we're at from a balance sheet perspective. But there are other opportunities, particularly in the diagnostic space, and they're rich opportunities and they're out there. And so we believe that we could dramatically improve revenue in EBITDA by prosecuting those. So, yeah, we're excited about that. But, you know, we will only do it if it makes sense.

Speaker Change #185: Running a very tight ship as it relates to dilution, so

Hamed Shahbazi: We believe that rates are likely to come down, so that will be an influence as that occurs. But there are, as this cash becomes available, we believe that we'll be able to reallocate it in an extremely creative, fast, and in the Canadian healthcare landscape. Keep in mind right now, we're acquiring, you know, the lowest cost assets that we can find that make sense for where we're at from a balance sheet perspective, but there are other opportunities, particularly in the diagnostic space, and their rich opportunities, and they're out there. And we believe that we could dramatically improve revenue and EBITDA by prosecuting those.

Speaker Change #186: We don't want to materially increase our debt, we believe that rates are likely to come down, so that will be an influence as that occurs, but there are, as this cash becomes available, we believe that we'll be able to reallocate it in an extremely creative fashion in the Canadian healthcare landscape.

Speaker Change #186: Keep in mind right now, we're acquiring, you know, the lowest cost.

Speaker Change #186: Assets that we can find that that makes sense for where we're at from a balance sheet perspective But there are other opportunities particularly in the diagnostic space

Hamed Shahbazi: Miguel has over 20 years experience in the field of AI, and he most recently was the VP of AI at Rev, a speech technology company where he built the world's most accurate speech-to-text engine and previously served as speech scientist at Nuaz. Miguel will also lead the company's partnership with Nila Quebec Artificial Intelligence Institute. Nila is the world's largest academic research center for deep learning, bringing together over 1200 specialized researchers in machine learning.

Speaker Change #187: And they're rich opportunities and and and they're out there and we we so we believe that we could dramatically improve revenue need that by by prosecuting those

Hamed Shahbazi: So yeah, we're excited about that, but you know, we will only do it if it makes sense. As I mentioned, you know, Circle Medical and Whisper doing extremely well and we'll continue to grow these businesses over the next little while, while we work with the capable advisors that I mentioned.

Speaker Change #188: So, yeah, we're excited about that. But, you know, we will only do it if it makes sense. As I mentioned, you know, Circle, Medical, and WISPR are doing extremely well, and we'll continue to grow these businesses over the next little while, while we work with the capable advisors that I mentioned.

Hamed Shahbazi: As I mentioned, you know, Circle Medical and Whisper are doing extremely well and will continue to grow these businesses over the next little while, while we work with the capable advisors that I mentioned. My second question is related, and we started together at Hamed, but in terms of M&I priorities in the near term, what you would acquire in the next quarter or two? Would you say the Canadian clinic program is the focus for now, again, in Canada, north of the border, or would you say there's other targets you thought in the pipe in the near term. I just what are your thoughts there.

Hamed Shahbazi: In other key hires, the return of Brent LaRou to Circle Medical in the role of VP product and patient experience, Brent's return to Circle signals a renewed focus on product design as a core competency, which will drive further usage and engagement. For Q3, we expect another record revenue quarter with positive adjusted EBITDA as the business goes from strength to strength, and we reiterate our previous guidance of Circle expecting to be positive EBITDA for the year.

Hamed Shahbazi: Perfect. My second question is related, and you started to get it at home. But in terms of, I mean, I have priorities in the near term, you know what you would acquire in the next quarter or two. Would you say the Canadian clinic program is the focus for now? Yeah, again, in Canada, north of the border, or would you say there are other targets you've got in the pipe in the near term. I just wonder your thoughts there. I guess through the next few months. Yeah, yeah, look, I think the Canadian clinic program is very strong right now.

Speaker Change #189: Perfect. My second question is related and we started together at Hamed.

Speaker Change #189: But in terms of M&I priorities in the near term, what you would acquire in the next quarter or two.

Speaker Change #189: Would you say?

Speaker Change #190: The Canadian Clinic program is the focus for now. Again in Canada, north of the border, or would you say there's other targets you've got in the pipe in the near term? I just what are your thoughts there? I guess through the next few months.

Hamed Shahbazi: I guess through the next few months. Yeah, yeah, look, I think the Canadian clinic program is very strong right now, not only because of where the. We've been delivering some pretty good reports in terms of what's happening with those legacy NCI clinics, the LaBla Shoppers Clinic. We have a lot of confidence in what we're doing. Really, there's not many others in the country that have been able to demonstrate this sort of growth and improvement.

Hamed Shahbazi: And now an update on WISP. I'm pleased to report that WISP reported positive adjusted EBITDA in Q2, 24 with revenue of 24.3 million and increase of 27% from Q2, 2023. More importantly, WISP improves its profitability with adjusted EBITDA increasing 225% compared to Q2 last year. Adjusted gross margins improved this quarter compared to the same quarter last year due to better pricing negotiations with pharmacy partners as well as prior margins were negatively impacted by significant outage at one of the company's main pharmacy partners.

Speaker Change #191: Yeah, yeah, look, I think the Canadian Clinic Program is very strong right now, not only because of where the...

Hamed Shahbazi: Not only because of where the where where the costs of the assets are, but really are confidence with clinic transformation. You know, as you can see, now we've been delivering some pretty good reports in terms of what's happening with those legacy NCI clinics and that is so. But clinics. The law blot shoppers clinic. So we have a lot of confidence in what we're doing. And really there's not many others in the country that have been able to demonstrate this sort of growth, so an improvement. So, so that's definitely something that will continue to do, and we see other, you know, distressed or quasi-distressed situations out there that we're investigating.

Speaker Change #192: where the costs of the assets are but really our confidence with clinic transformation you know as you can see now we've been delivering some pretty good reports in terms of what's happening with

Speaker Change #192: Illegacy NCI Clinics, Medisobic Clinics, The Law Blosshoffers Clinics

Speaker Change #192: So, we have a lot of confidence in what we're doing, and really there's not many others in the country that have been able to demonstrate this sort of growth and improvement.

Hamed Shahbazi: That's definitely something that we'll continue to do, and we see other distressed or quasi-distressed situations out there that we're investigating. And we also see just some really well-run businesses that are more in the specialist and diagnostics side of things, where, again, I think as we bring on more capital, we'll be very happy to take on. We'll take on some of these, notwithstanding any kind of material divestments, because we think that it's important to continue to lean into some of those opportunities.

Speaker Change #193: That's definitely something that we'll continue to do, and we see other, you know, distressed or quasi-distressed situations out there that we're investigating. And we also see some, just some really well-run businesses that are more in the specialist and diagnostics side of things.

Hamed Shahbazi: As far as product development is concerned, WISP has been very busy with its fertility vertical with pre-IVF prescription offering. It has also launched its new UTI care kit while also expanding at-home diagnostics, which will be foundational to establishing a longitudinal care model and key new product launches by the end of the year. In July, WISP was also launched and has seen strong early traction as an annual membership program where patients can access discounts on products as well as exclusive services. Inc. Amazon Prime for WISP. For Q3, we expect WISP to see continued growth as a business ramped up marketing spend to lean into summer seasonality.

Hamed Shahbazi: And we also see some just some really well run businesses that are more in the specialist and diagnostics and the side of things. Where again, I think as we, as we bring on more capital, will be very happy to take on. No, we'll take on some of these notwithstanding any kind of material divestments because we think that it's important to continue to lean into some of those opportunities. Keep in mind as well that we're now starting to establish a pipeline for the provider solutions. Staff and technology segment, we'd like to ramp this back up and with the view now that we will have a standalone public company.

Speaker Change #194: where, again, I think as we bring on more capital, we'll be very happy to take on... We'll take on some of these, notwithstanding any kind of material divestments, because we think that it's important to continue to lean into some of those opportunities.

Hamed Shahbazi: Keep in mind as well that we're now starting to establish a pipeline for the provider solutions SaaS and technology segment. We'd like to ramp this back up, and with the view now that we will have a standalone public company, we believe that there's opportunity to create some currency even before a go-public initiative, potentially even through a direct investment into that entity. So we've now started to establish a pipeline there. So I think you'll start to see our digital acquisitions start to speed up again.

Speaker Change #194: Keep in mind as well that we're now starting to establish a pipeline for the provider solutions.

Speaker Change #194: Stats and Technology segment.

Speaker Change #194: We'd like to ramp this back up and with the view now that

Hamed Shahbazi: We believe that there's opportunity to create some currency even before. Upgo public initiatives potentially even through a direct investment into that entity. So we've now started to establish a pipeline there, so I think you'll start to see our digital acquisitions start to speed up again. So we're very pleased to be doing that.

Speaker Change #195: we will have a standalone public company. We believe that there's opportunity to create some currency even before a public initiative, potentially even through a direct investment into that entity.

Speaker Change #196: So we've now started to establish a pipeline there. So I think you'll start to see our digital acquisitions start to speed up again. So we're very pleased to be doing that as well.

Hamed Shahbazi: So we're very pleased to be doing that as well. Thank you for taking my questions. Thank you and that concludes our question and answer session. I will now hand the call back to Mr. Hamed Shahbazi for any closing remarks. I'd like to thank everyone for their great questions and all their support today. We hope that you liked the slides and the updated presentation approach and we look forward to great updates over the next several weeks and months in different lines of our business. Thank you. I hope you stay safe and we'll speak to you in November. And that concludes our conference today. Thank you for participating. You may all disconnect.

Hamed Shahbazi: Thank you for taking my questions.

Hamed Shahbazi: My past alarm. Thank you.

Speaker Change #196: Perfect. Thank you for taking my questions and I'll pass the line.

Operator: That concludes our question in answer session.

Hamed Shahbazi: I will now hand the call back to Mr. Hamed Shahbazi for any closing remarks. I'd like to thank everyone for their great questions and all their support today. We hope that you liked the slides and the updated presentation approach. We look forward to great updates over the next several weeks and months in different lines of our business. Thank you. I hope you stay safe, and we'll speak to you in November.

Speaker Change #197: Thank you and that concludes our question and answer session. I will now hand the call back to Mr. Hamed Shahbazi for any closing remarks.

Speaker Change #198: I'd like to thank everyone for their great questions and all their support today. We hope that you liked the slides and the updated presentation approach, and we look forward to great updates over the next several weeks and months in different lines of our business. Thank you. I hope you stay safe, and we'll speak to you in November .

Hamed Shahbazi: On July 10, 2024, we announced the approval of a historic $44 million project, health compass to the largest digital supercluster project ever awarded in advance to advance AI power tech enablements for care providers. This initiative led by WELL and its consortium partners aims to enhance AI and interoperability in Canadian healthcare. As a lead commercialization partner and first customer, we will provide expertise and interoperability enabling the development of new AI tools to support healthcare providers.

Operator: That concludes our conference today. Thank you for participating, and we all disconnect.

Speaker Change #199: And that concludes our conference today. Thank you for participating. You may all disconnect.

Hamed Shahbazi: Furthermore, this quarter, we announced a five-year collaboration with Microsoft to enhance digital healthcare across North America, integrating Microsoft's cloud and AI with WELL's platform. This partnership focuses on elevating well-scale ability and operational efficiency, aiming to transform healthcare delivery for large enterprises, including the public sector. The collaboration will also modernize WELL's cloud infrastructure, optimize costs, secure data, and integrate Azure Open AI service to advance healthcare solutions.

Hamed Shahbazi: The company has significantly improved this balance sheet as just this past quarter between reductions in liabilities and you capital injected, there was $43 million of positive impact to its balance sheet. More importantly, the company has established itself as a leader in leveraging artificial intelligence to unlock the value of data for two key audiences, healthcare workers who need co-pilot technologies to better detect disease and pharmaceutical companies who need better real-world evidence and improvements to their research and development processes, leading to better clinical trials or orchestration.

Hamed Shahbazi: In fact, Heelwell is starting to do for CR Rose or clinical research organizations what WELL has been doing for healthcare clinics, which is to modernize and digitize them. This is a trend that we believe will drive the company to hundreds of millions of dollars in revenue, and significant profits in the coming years. Hill WELL's DRO has already served more than 250 pharmaceutical clients. When one starts to combine the ability for Hill WELL AI to find patients and support the pharmaceutical industry with the next generation patient-finding technology, with the vast network of clinical data at well, together we have something truly valuable and globally relevant.

Hamed Shahbazi: We're pleased to remind shareholders that WELL has a call option on 30 million multivoting shares of Hill WELL, which will give WELL voting control over the company when exercise. We anticipate doing this at some point in time in 2025. Hill WELL will continue to operate as a standalone public company, but we will then add all of Hill WELL's top and bottom line activity to WELL's IFRS statements.

Hamed Shahbazi: We look forward to this.

Hamed Shahbazi: In summary, we're very pleased with our financial performance thus far in 2024 and look forward to delivering strong results for the remainder of the year. Our outlook remains very positive, hence we are improving our guidance as previously noted. We have a committed and disciplined team to ensure we can execute on our objectives, including our very important strategic initiatives designed to realize some of parts value, which we believe is central to our plan to drive shareholder value.

Inna: And with that, we'd be pleased to take some questions, operator. Thank you, ladies and gentlemen.

Inna: We will now begin the question and answer session. Should you wish to ask a question, please press star one on your telephone, Kipad. And should you wish to cancel your request, please press star two.

Michael Freeman: Your first question, constant and line of prop golf from Ben-Tum, please go ahead. Thank you very much for taking my question and congratulations on the quarter, a lot was in there. Thank you, Rob.

Hamed Shahbazi: Please, please speak with you. Perhaps, I'm sure there'll be a lot of questions on circle. Can you perhaps talk to the ramp up in growth because I know from your release that July I saw a year-of-year growth of 65% versus 53 on the quarter, and perhaps could you dive into the impact of the plans for the hires and the partnerships within that? Yeah, look, I mean last year, we had made a significant number of investments as you may remember, it did affect our EBITDA, in fact, this past quarter, when you look at the comparatives in the year before, there's a stark difference in terms of not only growth rate, but also profitability.

Hamed Shahbazi: So circle, not only surge in profitability and some margin expansion, but it was also able to see a lot of that fall to the bottom line. So we're very pleased with that. Again, there was just a lot of work that we did this past year in making investments in the company's technology. We also invested in a clinical network that was costly in time consuming and just a heck of a lot of work to stand up.

Hamed Shahbazi: But it's there now, and we are a hybrid care provider, which, and not just a pure telemedicine provider, which I think is incredibly important. So, yeah, we're very optimistic for the future, and the company has always been very strong in technology. They have a very, we kind of refer to them as a full stack primary care company. They're very much an advanced technology company. They've essentially built their own EMR minus the billing components.

Hamed Shahbazi: So there's just a lot there, and I think their ability to execute on AI will be noteworthy. So, yeah, we're quite excited, especially as we start to consider stupidical stakeholders for cerebral medical. We believe they're trending at the right time. And if I could, on the fast and service provider solution, the consideration of spinning out a non-control position, I think it has both for surfacing value within the some of the parts, but also it establishes the currency where I presume there are a number of acquisition candidates.

Hamed Shahbazi: Yeah, you nailed it, Rob, you know, if you look at how we built our staff and services division, you know, it was through a number of different acquisitions, we consolidated a kind of a cottage industry of Oscar service providers, and we've integrated those successfully. And this business is operating incredibly well, when you look at the financial profile, we describe to the company in terms of growth profitability, and we have not made any material acquisition in quite some time.

Hamed Shahbazi: And so given the prospects that this company has given, given also just, you know, the scarcity value. We've having an asset like this on the Canadian capital markets, we think that it generates a lot of momentum, likely results in significant value increases, well creating new currency that will benefit not only well health, but also it's ongoing business. So, you know, we're very pleased at this and currently putting together an architecting the plan and establishing timing.

Hamed Shahbazi: Thank you.

Michael Freeman: And your next question comes in the line of Michael Freeman from Raymond James, please go ahead.

Michael Freeman: Hi, I'm Eva and Tyler. Thanks very much for taking the questions and your thoughts on a really strong quarter.

Michael Freeman: I'm going to ask another question on the plan to spin off the provider services business. I wonder if you could update us on, you know, potential timelines and progress down this path, for instance, like are there revenue thresholds that you'd like to just pass before undertaking this and like I recognize that you would be potentially going public with a non controlling float out there. What risks do you see in spinning this out given that these provider services provide sort of the backbone to Wells, you know, Wells core business of Canadian clinics.

Michael Freeman: Yeah, Michael, thanks for the question. I tried to answer some of that proactively in my script, but because of the strong, you know, control that we will exercise on a controlled public company. You know, we don't really see any changes that would occur operationally. All of our relationships from an intercompany perspective today already have intercompany agreements. Those intercompany agreements would endure, so nothing would change there. You know, we effectively see our, we've always seen our clinics as being kind of customer number one for our platform and provider solutions group that would continue.

Michael Freeman: Right now, from a timing perspective, we are thinking of H1 2025. So not that long from now. We believe based on some of the organic growth and M&A activity that we're looking at, that it's likely that 2025 will be a 50 plus million dollar revenue business for this segment. And if you kind of look at the growth and the profitability, I mean, this is right now a rule of 50 plus companies, but I think this can be a reliably rule of 40 plus company for quite some time.

Hamed Shahbazi: [inaudible] I'm sure if you could, I'm sure if you could, I'm sure What do you think would be the key use of proceeds for the business? And you know, if it is that repayment, comment and you get down below a ratio you're comfortable with, you know, at that point, under the core wall business, would you get more inquisitive, would you invest more in growth? Like, what do you see as the plan, you know, you're out from now and things have been sold or wrong to the side of some of these transactions?

Hamed Shahbazi: Yeah, thanks, Christian. Good, good question. I'm referencing a little bit in the script, but look beyond debt repayments and potential special buyback. You know, we do have a pipeline of acquisitions that we've liked that we sort of put to the side for now that is a bit bigger than we would like to prosecute with our current cash reserves. You know, as you know, as I'm sure everyone can tell by this presentation, we're just very, very focused on running a very tight ship as it relates to dilution, so we don't want to necessarily increase our debt.

Hamed Shahbazi: We believe that rates are likely to come down, so that will be an influence as that occurs. But there are, as this cash becomes available, we believe that we'll be able to reallocate it in extremely creative, fast and in the Canadian healthcare landscape. Keep in mind right now, we're acquiring, you know, the lowest cost assets that we can find that make sense for where we're at from a balance sheet perspective, but there are other opportunities, particularly in the diagnostic space and their rich opportunities and they're out there.

Hamed Shahbazi: And we believe that we could dramatically improve revenue and EBITDA by prosecuting those. So yeah, we're excited about that, but you know, we will only do it if it makes sense. As I mentioned, you know, circle medical and whisper doing extremely well and we'll continue to grow these businesses over the next little while, while we work with the capable advisors that I mentioned.

Hamed Shahbazi: Perfect. My second question is related and you started to get it at home. But in terms of I mean, I have priorities in the near term, you know what you would acquire in the next quarter or two. Would you say the Canadian clinic program is the focus for now? Yeah, again, in Canada, north of the border, or would you say there's other targets you've got in the pipe in the near term.

Hamed Shahbazi: I just wonder your thoughts there. I guess through the next few months. Yeah, yeah, look, I think the Canadian clinic program is very strong right now. Not only because of where the where where the costs of the assets are, but really are confidence with clinic transformation. You know, as you can see, now we've been delivering some pretty good reports in terms of what's happening with those legacy NCI clinics and that is so but clinics.

Hamed Shahbazi: The law blot shoppers clinic. So we have a lot of confidence in what we're doing. And really there's not many others in the country that have been able to demonstrate this sort of growth so an improvement. So so that's definitely something that will continue to do and we see other, you know, distressed or quasi distressed situations out there that we're investigating. And we also see some just some really well run businesses that are more in the specialist and diagnostics and the side of things.

Hamed Shahbazi: Where again, I think as we as we bring on more capital will be will be very happy to take on. No, we'll take on some of these notwithstanding any kind of material divestments because we think that it's important to continue to to lean into some of those opportunities. Keep in mind as well that we're now starting to establish a pipeline for the provider solutions. Staff and technology segment, we'd like to ramp this back up and with the view now that we will we will have a standalone public company.

Hamed Shahbazi: We believe that there's opportunity to create some currency even before. Upgo public initiatives potentially even through a direct investment into that entity. So we've now started to establish a pipeline there so I think you'll start to see our digital acquisitions start to start to speed up again. So we're very pleased to be doing that.

Michael Freeman: Thank you for taking my questions.

Michael Freeman: My past alarm. Thank you.

Hamed Shahbazi: That concludes our question in answer session. I will now hand the call back to Mr. Hamed Shahbazi for any closing remarks. I'd like to thank everyone for their great questions and all their support today. We hope that you liked the slides and the updated presentation approach. We look forward to great updates over the next several weeks and months in different lines of our business. Thank you. I hope you stay safe and we'll speak to you in November.

Inna: That concludes our conference today. Thank you for participating and we all disconnect.

Q2 2024 WELL Health Technologies Corp Earnings Call

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