Progressive Care Inc. Announces Second Quarter 2024 Revenues of $13.5 Million, an Increase of 17% as Gross Margin Expands to 35%
41% Growth in 340B Contract Service Revenue and Momentum in Prescription Volumes Drive Positive Cashflow from Operations
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Second Quarter 2024 Financial Highlights:
- Total revenues increased by approximately
$1.9 million , or 17%, to approximately$13.5 million during the three months endedJune 30, 2024 , compared to approximately$11.6 million in the prior year period. - Prescription revenue, net of pharmacy benefit managers ("PBM") fees, increased by approximately
$1.1 million , or 11%, to approximately$10.5 million during the second quarter of 2024, compared to approximately$9.4 million in the prior year period. - 340B contract revenue was approximately
$3.0 million during the second quarter of 2024, an increase of approximately$0.9 million , or 41%, compared to approximately$2.1 million in the same prior year period. The increase was primarily attributable to an increase in new 340B contracts that were secured late last year. - Overall gross profit margin in the second quarter of 2024 was approximately 35%, versus approximately 31% in the second quarter of 2023.
- Second quarter of 2024 results include a non-cash goodwill impairment charge of approximately
$0.7 million and a non-cash intangible assets impairment charge of approximately$9.1 million . The Company conducts ongoing impairment testing on the estimated fair value of goodwill and intangible assets in accordance withU.S. generally accepted accounting principles ("U.S. GAAP"). Fair value methodologies for intangible assets include estimates of future cashflows related to the Company's 340B pharmacy service agreements. These estimates of future cash flows are subject to change due to multiple external factors including the 340B covered entity's patient outcomes and adherence with program compliance requirements. As ofJune 30, 2024 , there was no remaining goodwill and approximately$4.0 million of intangibles assets to be amortized over the next four years. - Cash balance as of
June 30, 2024 was approximately$8.5 million as compared to approximately$7.9 million as ofDecember 31, 2023 . The Company generated approximately$0.8 million of cash from operating activities for the second quarter of 2024.
Organizational Highlights and Recent Business Developments:
- On
April 12, 2024 ,NextPlat announced a proposed merger withProgressive Care Inc. in an all-stock transaction which is expected to provide annual operating cost reductions. OnAugust 6, 2024 , the Company filed the definitive proxies regarding the proposed business combination and setSeptember 13, 2024 , as the Annual Meeting date for the shareholder vote. If approved by shareholders at the Annual Meeting, and subject to customary closing conditions and requirements, the Company anticipates completing the transaction in early October. - Business development activities targeting 340B covered entities conducted late last year combined with enhanced sales efforts and resources dedicated to long-term care and assisted living facilities launched earlier this year, have contributed to increased revenue and growth in prescription volumes at its PharmcoRx pharmacies.
- The Company's focus on providing high-touch, data-driven personalized patient care services at its concierge PharmcoRx pharmacies is a significant differentiator in the market compared to the broader "commodity" retail sector which is currently closing thousands of locations.
Summary Financials for the Three Months Ended
Note on Financial Presentation
On
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Successor |
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Predecessor |
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Three Months |
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Three Months |
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$ Change |
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% Change |
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Total revenues, net |
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$ |
13,477 |
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$ |
11,556 |
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$ |
1,921 |
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17 |
% |
Total cost of revenue |
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8,782 |
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7,997 |
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785 |
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10 |
% |
Total gross profit |
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4,695 |
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3,559 |
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1,136 |
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32 |
% |
Operating expenses |
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13,994 |
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2,935 |
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11,059 |
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377 |
% |
(Loss) income from operations |
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(9,299) |
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624 |
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(9,923) |
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nm |
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Other income (expense) |
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23 |
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(5,261) |
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5,284 |
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(100) |
% |
Loss before income taxes |
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(9,276) |
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(4,637) |
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(4,639) |
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|
|
100 |
% |
Provision for income taxes |
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— |
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— |
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— |
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— |
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Net loss attributable to common shareholders |
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$ |
(9,276) |
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$ |
(4,637) |
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$ |
(4,639) |
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100 |
% |
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nm = not meaningful |
For the second quarter of 2024, the Company recognized overall revenue from operations of approximately
Overall gross profit margins increased from 31% for the three months ended
Loss from operations was approximately
Financial Results for the three months ended
Revenue
Prescription revenue, net of PBM fees increased by approximately
The Company filled approximately 133,000 and 118,000 prescriptions during the three months ended
Dispensing fees and third-party administration ("TPA") revenue earned on our 340B contracts for the three months ended
Operating Expenses
Our operating expenses increased by approximately
- approximately
$9.8 million of impairment losses related to goodwill and long-lived assets impairments (see further explanations below); - approximately
$0.7 million increase in the amortization of newly identifiable intangible assets as a result of the push-down accounting; - approximately
$0.5 million increase in salaries and wages due to a combination of performance-based salary adjustments and additional headcount, net of attrition due to normal employee turnover; and - approximately
$0.1 million increase in franchise taxes.
The Company performed a goodwill impairment test during the three months ended
The Company performed a long-lived assets impairment test during the three months ended
Other Income (Expense)
Other income (expense) increased by approximately
Net Loss
Net loss was approximately
Quarterly Report on Form 10-Q Available
The Company's Quarterly Report on Form 10-Q, available at www.sec.gov and on the Company's website, contains a thorough review of its financial results for the three months ended
Forward-Looking Statements
The statements contained herein regarding our future plans and the anticipated effects of the proposed business combination between the Company and
About
Important Information About the Merger and Where to Find It
In connection with the proposed merger between
Participants in the Solicitation
No Offer or Solicitation
This press release shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Merger. This press release shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of the proxy statement/ prospectus.
Investor Contact for
917-397-2272
mike@mwgco.net
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