OptimizeRx Corp. (NASDAQ: OPRX), a leading provider of digital
health messaging for the pharmaceutical industry, reported results
for the third quarter ended September 30, 2018. Quarterly
comparisons are to the same year-ago quarter.
Financial Highlights
- Net revenue increased 75% to a record $5.4 million.
- Gross margin improved from 58.1% to 45.1%.
- Operating expense as a percentage of net revenue reduced from
55% to 42%.
- Net income of $245,000 or $0.02 per diluted share vs. a
loss
Operational Highlights
- Acquired CareSpeak Communications, a leader in interactive
health messaging for improved medication adherence and care
coordination, expanding OptimizeRx’s reach to communicate directly
to patients, resulting in greater medication adherence, persistence
and affordability.
- Partnered with Medicom Health, a software company that creates
evidence-based health and wellness applications for enriched online
consumer engagement at more than 600 hospitals nationwide.
- Launched a 2:1 return-on-investment (ROI) guarantee to
pharmaceutical manufacturers who invest in the company’s financial
messaging solutions.
- Signed new pharmaceutical manufacturer brands for distributing
digital health messaging through OptimizeRx’s expanding network of
EHR channel partners.
Financial Summary Net revenue in the third
quarter of 2018 increased 75% to a record $5.4 million versus $3.1
million in the same year-ago quarter. The increase was primarily
due to growth in OptimizeRx’s two core products of financial and
brand messaging, coupled with broader distribution through the
company’s new channel partners. The launch of new pharmaceutical
brands also contributed to the increase.
Gross margin improved to 58.1% in the third quarter of 2018 from
45.1% in the year-ago quarter. The improvement was due to favorable
product mix and reduced revenue share cost.
The company remains focused on improving margins, and maintains
its gross margin target of at least 55% through the fourth quarter
of 2018.
Operating expenses in the third quarter of 2018 were $2.9
million, up from $2.0 million in the same year-ago quarter. The
increase was primarily due to additional expenses related to growth
initiatives, including expanding the company’s team. However,
operating expense as a percentage of revenue decreased to 54% as
compared to 65% in the same year-ago quarter.
Net income for the third quarter of 2018 was $245,000 or $0.02
per share, as compared to a net loss of $623,000 or $(0.06) per
share in the year-ago quarter. Profitability was primarily due to
the increase in revenue and decrease in operating expense as a
percentage of revenue. The company expects to continue to be
profitable on a quarterly basis, although one-time expenses related
to growth initiatives may result in quarterly fluctuations in
profitability.
Cash and cash equivalents totaled $13.5 million at September 30,
2018, as compared to $12.0 million at June 30, 2018. The increase
in cash was due to $9.0 million equity raise completed in May 2018.
The company has continued to operate debt-free and expects to
generate positive cashflow from operations for the remainder of
2018.
Management Commentary
“In Q3, we realized our eighth consecutive quarter of revenue
growth and second consecutive quarter of profitability through
adding new pharmaceutical brands, growing our digital health
messaging revenue and expanding our distribution channels,” said
OptimizeRx CEO, William Febbo.
“Our topline was up 75% from the year-ago quarter and up 6%
sequentially, demonstrating how our low fixed-overhead model
continues to support a highly-scalable financial opportunity. This
was also evident in our expanding margins. In fact, at 58.1% for
the quarter, we for the second time in a row surpassed our
previously announced gross margin goal of 55%, and we plan to again
exceed this goal in the current quarter.
“Today, our network reaches over half the nation's healthcare
providers and the ambulatory market, making OptimizeRx the
healthcare industry's largest point-of-care network. Through our
digital platform, pharma companies can regain critical access to
doctors and their patients and provide the information and savings
they need and precisely when they need it, in the point of care,
and create better health outcomes, a win-win-win.
“Subsequent to the quarter, our strategic acquisition of
CareSpeak Communications allows us to complement and diversify
our revenue streams while continuing to scale. There are immense
resources being poured into quality improvement and value-based
care, all for the simple reason that it improves outcomes and
reduces costs for all stakeholders. By adding CareSpeak’s
complementary capabilities to our platform, we extend our ability
to engage doctors and patients, and improve health. CareSpeak
allows us to further bridge the critical communication gaps between
pharma, healthcare providers and patients.
“For the remainder of 2018, we plan to continue expanding our
reach to physicians, pharmacies and patients, and bringing new
solutions to our existing clients to capture more budget per
pharmaceutical manufacturer. As we continue to demonstrate high ROI
from the marketing spend of our pharma clients, we expect increased
adoption of our digital health platform in cloud-based EHR
channels, hospital systems and ultimately by potential
clients.”
Conference Call
OptimizeRx management will host the presentation, followed by a
question and answer period.
Date: Monday, November 5, 2018Time: 4:30 p.m. Eastern time (1:30
p.m. Pacific time)Toll-free dial-in number:
1-888-221-3881International dial-in number:
1-323-794-2591Conference ID: 1275447
Please call the conference telephone number five minutes prior
to the start time. An operator will register your name and
organization. If you have any difficulty connecting with the
conference call, please contact CMA at 1-949-432-7566.
A replay of the call will be available after 7:30 p.m. Eastern
time on the same day through November 26, 2018, as well as
available for replay via the Investors section of the OptimizeRx
website at www.optimizerx.com.
Toll-free replay number: 1-844-512-2921International replay
number: 1-412-317-6671Replay ID: 1275447
About OptimizeRx OptimizeRx® (NASDAQ: OPRX) is
one of the nation’s leading providers of digital health messaging
via electronic health records (EHRs), providing a direct channel
for pharma companies to communicate with healthcare providers. The
company’s cloud-based solution supports patient adherence to
medications by providing real-time access to financial assistance,
prior authorization, education, and critical clinical information.
The company’s network is comprised of leading EHR platforms like
Allscripts, Amazing Charts and Quest, and provides more than half
of the ambulatory patient market with access to these benefits
within their workflow at the point-of-care. For more information,
follow the company on Twitter, LinkedIn or
visit www.optimizerx.com.
Important Cautions Regarding Forward Looking
Statements This press release contains forward-looking
statements within the definition of Section 27A of the Securities
Act of 1933, as amended, and such as in section 21E of the
Securities Act of 1934, as amended. These forward-looking
statements should not be used to make an investment decision. The
words 'estimate,' 'possible' and 'seeking' and similar expressions
identify forward-looking statements, which speak only as to the
date the statement was made. The company undertakes no obligation
to publicly update or revise any forward-looking statements,
whether because of new information, future events, or otherwise.
Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted, or quantified.
Future events and actual results could differ materially from those
set forth in, contemplated by, or underlying the forward-looking
statements. The risks and uncertainties to which forward-looking
statements are subject include, but are not limited to, the effect
of government regulation, competition and other material risks.
OPTIMIZERx
CORPORATION CONDENSED CONSOLIDATED BALANCE
SHEETS
|
|
September 30, 2018 |
|
|
December 31, 2017 |
|
ASSETS |
|
|
(unaudited) |
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
13,523,002 |
|
|
$ |
5,122,573 |
|
Accounts
receivable |
|
|
3,791,964 |
|
|
|
2,257,276 |
|
Accounts
receivable – related party |
|
|
1,373,054 |
|
|
|
1,173,614 |
|
Prepaid
expenses |
|
|
201,320 |
|
|
|
255,428 |
|
Total Current
Assets |
|
|
18,889,340 |
|
|
|
8,808,891 |
|
Property and equipment,
net |
|
|
149,936 |
|
|
|
167,305 |
|
Other Assets |
|
|
|
|
|
|
|
|
Patent
rights, net |
|
|
587,848 |
|
|
|
638,766 |
|
Web
development and other intangible costs, net |
|
|
128,381 |
|
|
|
143,730 |
|
Security
deposit |
|
|
5,049 |
|
|
|
5,049 |
|
Total Other Assets |
|
|
721,278 |
|
|
|
787,545 |
|
TOTAL ASSETS |
|
$ |
19,760,554 |
|
|
$ |
9,763,741 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current
Liabilities |
|
|
|
|
|
|
|
|
Accounts
payable – trade |
|
$ |
165,458 |
|
|
$ |
457,289 |
|
Accrued
expenses |
|
|
814,530 |
|
|
|
953,947 |
|
Revenue
share payable |
|
|
763,084 |
|
|
|
1,177,136 |
|
Revenue
share payable – related party |
|
|
- |
|
|
|
447,670 |
|
Deferred
revenue |
|
|
813,316 |
|
|
|
507,160 |
|
Total
Liabilities |
|
|
2,556,388 |
|
|
|
3,543,202 |
|
Stockholders'
Equity |
|
|
|
|
|
|
|
|
Preferred
stock, $0.001 par value, 10,000,000 shares authorized, no issued
and outstanding at September 30, 2018 or December 31, 2017 |
|
|
- |
|
|
|
- |
|
Common
stock, $0.001 par value, 166,666,667 shares authorized, 11,970,976
and 9,772,694 shares issued and outstanding at Sept 30, 2018 and
December 31, 2017, respectively |
|
|
11,971 |
|
|
|
9,773 |
|
Stock
warrants |
|
|
- |
|
|
|
1,286,424 |
|
Additional paid-in-capital |
|
|
47,361,086 |
|
|
|
35,287,464 |
|
Accumulated deficit |
|
|
(30,168,891 |
) |
|
|
(30,363,122 |
) |
Total Stockholders'
Equity |
|
|
17,204,166 |
|
|
|
6,220,539 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
$ |
19,760,554 |
|
|
$ |
9,763,741 |
|
|
|
|
|
|
|
|
|
|
OPTIMIZERx
CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED)
|
|
For the Three Months EndedSeptember 30 |
|
|
For the Nine Months EndedSeptember 30 |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
NET REVENUE |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
3,990,486 |
|
$ |
2,076,736 |
|
|
$ |
9,951,743 |
|
$ |
5,729,275 |
|
Revenue – Related
Party |
|
1,424,898 |
|
|
1,025,871 |
|
|
|
4,675,351 |
|
|
2,391,227 |
|
TOTAL NET REVENUE |
|
5,415,384 |
|
|
3,102,607 |
|
|
|
14,627,094 |
|
|
8,120,502 |
|
REVENUE SHARE
EXPENSE |
|
2,268,968 |
|
|
1,703,676 |
|
|
|
6,513,810 |
|
|
4,690,943 |
|
GROSS
MARGIN |
|
3,146,416 |
|
|
1,398,931 |
|
|
|
8,113,284 |
|
|
3,429,559 |
|
OPERATING EXPENSES |
|
2,923,238 |
|
|
2,028,589 |
|
|
|
7,807,705 |
|
|
5,320,220 |
|
INCOME
(LOSS) FROM OPERATIONS |
|
223,178 |
|
|
(629,658 |
) |
|
|
305,579 |
|
|
(1,890,661 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE) |
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
21,750 |
|
|
6,872 |
|
|
|
30,679 |
|
|
23,691 |
|
Interest
expense |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OTHER INCOME (EXPENSE) |
|
21,750 |
|
|
6,872 |
|
|
|
30,679 |
|
|
23,691 |
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME (LOSS) BEFORE
PROVISION FOR INCOME TAXES |
|
244,928 |
|
|
(622,786 |
) |
|
|
336,258 |
|
|
(1,866,970 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR INCOME
TAXES |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
NET INCOME (LOSS) |
$ |
244,928 |
|
$ |
(622,786 |
) |
|
$ |
336,258 |
|
$ |
(1,866,970 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING |
|
|
|
|
|
|
|
|
BASIC |
|
11,755,500 |
|
|
9,752,122 |
|
|
|
10,840,584 |
|
|
9,839,325 |
|
DILUTED |
|
12,921,768 |
|
|
9,752,122 |
|
|
|
11,766,754 |
|
|
9,839,325 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) PER
SHARE |
|
|
|
|
|
|
|
|
|
|
|
BASIC |
$ |
0.02 |
|
$ |
(0.06 |
) |
|
$ |
0.03 |
|
$ |
(0.19 |
) |
DILUTED |
$ |
0.02 |
|
$ |
(0.06 |
) |
|
$ |
0.03 |
|
$ |
(0.19 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (UNAUDITED)
|
|
For the Nine MonthsEnded September 30 |
|
|
2018 |
|
2017 |
CASH FLOWS FROM
OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net
income (loss) for the period |
|
$ |
336,258 |
|
|
$ |
(1,866,970 |
) |
Adjustments to reconcile net income(loss) to net cash used in
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
163,418 |
|
|
|
212,918 |
|
Stock and
options issued for services |
|
|
1,721,979 |
|
|
|
497,033 |
|
Changes in: |
|
|
|
|
|
|
|
|
Accounts
receivable |
|
|
(1,734,128 |
) |
|
|
355,644 |
|
Prepaid
expenses |
|
|
54,108 |
|
|
|
(454,486 |
) |
Accounts
payable |
|
|
(291,831 |
) |
|
|
26,544 |
|
Revenue
share payable |
|
|
(414,722 |
) |
|
|
(744,526 |
) |
Accrued
expenses |
|
|
(139,417 |
) |
|
|
146,291 |
|
Deferred
revenue |
|
|
164,129 |
|
|
|
342,511 |
|
NET CASH USED IN
OPERATING ACTIVITIES |
|
|
(140,206 |
) |
|
|
(1,485,041 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Purchase
of property and equipment |
|
|
(23,131 |
) |
|
|
(29,310 |
) |
Web
development and other intangible costs |
|
|
(56,651 |
) |
|
|
(117,168 |
) |
NET CASH USED IN
INVESTING ACTIVITIES |
|
|
(79,782 |
) |
|
|
(146,478 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net
proceeds from issuance of common stock for cash |
|
|
8,620,417 |
|
|
|
- |
|
Repurchase of common stock and stock payable |
|
|
- |
|
|
|
(390,000 |
) |
NET CASH PROVIDED BY
(USED IN) FINANCING ACTIVITIES |
|
|
8,620,417 |
|
|
|
(390,000 |
) |
NET CHANGE IN CASH AND
CASH EQUIVALENTS |
|
|
8,400,429 |
|
|
|
(2,021,519 |
) |
CASH AND CASH
EQUIVALENTS - BEGINNING OF PERIOD |
|
|
5,122,573 |
|
|
|
7,034,647 |
|
CASH AND CASH
EQUIVALENTS - END OF PERIOD |
|
$ |
13,523,002 |
|
|
$ |
5,013,128 |
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid
for interest |
|
$ |
- |
|
|
$ |
- |
|
Cash paid
for income taxes |
|
$ |
- |
|
|
$ |
- |
|
Non-cash
issuance of shares to WPP |
|
$ |
447,000 |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
OptimizeRx ContactDoug Baker,
CFOTel (248) 651-6568 x807dbaker@optimizerx.com
Media Relations ContactNicole
Brooks, Innsena Communications(Tel)
860-800-2344nicolebrooks@innsena.com
Investor Relations ContactRon
Both, CMATel (949) 432-7557oprx@cma.team
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