Earnings Labs

Forian Inc. (FORA)

Q4 2021 Earnings Call· Thu, Mar 24, 2022

$2.16

+0.27%

Key Takeaways · AI generated
AI summary not yet generated for this transcript. Generation in progress for older transcripts; check back soon, or browse the full transcript below.

Same-Day

+0.16%

1 Week

+12.80%

1 Month

-43.76%

vs S&P

Transcript

Max Wygod

Management

Good afternoon everyone and thank you for joining us today. Forian delivered a strong fourth quarter as we ended an eventful year. We created a strong momentum in our healthcare information segment, evidenced by our revenue growth in 2021 and our initial outlook in 2022. We continued to execute against the plan of aggregating and integrating data sources from multiple industry segments. Before we jump into our results for the fourth quarter and fiscal year, I want to provide you with an overview of Forian's business. Forian strives to be one of the leading data science based intelligence providers to the healthcare and emerging markets. We build products derived from different types of data sourced throughout the healthcare ecosystem and in 2021 we acquired one of the largest concentrated sources of transactional cannabis data through the Helix combination. Our intention has been to use our expertise in standardizing complex data to successfully productize the data coming from our healthcare and cannabis sources and extend that offering to the marketplace. The majority of our investment and management focus over the past year has been in executing against this plan. We believe we have now the largest integrated database of healthcare demographic and cannabis data commercially available. This database is what we call our proprietary data factory and it is the foundation of our existing and new to market products. Our software and information offerings are powered by this data factory that de-identifies, normalizes and integrates the large and complex data sources and couples those data with the analytics to assist our clients in driving clinical and operational business performance improvement. Our information solutions allow our clients to access unique, timely and comprehensive insights into their customers' products and the dynamics of ever changing healthcare marketplace. Our leading cannabis software products include…

Dan Barton

Management

Thanks, Max. Good afternoon everyone. I'm pleased to report we delivered record results validating the opportunity we have in our target markets based on our capabilities and the ability to execute on our strategy. Before I begin my prepared remarks, I would like to take a moment and share our concern for everyone impacted by the war in Ukraine. We all watch the news and are disturbed about what is happening right now. Our thoughts are with everyone affected by this war and hope that this conflict can be brought to a peaceful conclusion as soon as possible. I would like to start with our top-line financial results. Forian delivered both fourth quarter 2021 and full year 2021 revenue at the top end of our guidance for the second half of 2021 and the full year 2121 as communicated earlier this year. Full year 2021 revenue was $16.9 million, up from $545,000 in 2020. On a pro forma basis, our revenue was $18.9 million compared to $12.3 million in the prior year, a 53% year-over-year growth. Q4 2021 revenue was $5.7 million, up from $210,000 in 2020, which was 80% growth on a pro forma basis year-over-year. These results were driven by the growth of our information and software business, mostly driven by accelerating growth in our healthcare information business. Coming into 2022, we have meaningful contracted backlog, which positions us well in 2022 and beyond. Full year 2021 services revenue was $1.1 million, which on a pro forma basis was largely flat as we continued to support and grow our state government business. The state business revenue can fluctuate quarterly based upon installation and one-time service items. We want additional contracts in 2021 increasing the number from 9 to 11. We were recently awarded the Florida track and trace…

Mike Vesey

Management

Thanks, Dan. Today, I'll provide an overview of Forian's financial results for the quarter ended December 31, 2021. As previously disclosed in our SEC filings, Forian completed the business combination of Helix Technologies and more analytics on March 2, 2021. The press release issued today presents Forian's fourth quarter 2020 and 2021 financial results on a GAAP basis as well as a pro forma basis as if the Helix results were included for the entire quarter in both periods. As in prior quarters, we've also reported adjusted EBITDA, which management uses a measure to track the performance of the business. The press release includes a detailed reconciliation of these measures. Our consolidated revenues of $5.7 million for the quarter up $5.5 million compared to the prior or year. On a pro forma basis, revenue increased $2.6 million or 80% year-over-year. As in prior quarters, our year-over-year growth was driven by the acquisition of Helix as well as organic growth and sales of our healthcare information products. It is also noteworthy that we have increased our revenue sequentially on both the pro forma and historical basis in each quarter in 2021. We attribute this consisting growth to recurring sales of our healthcare information products, which in many cases provide for continuing information deliverables to our customer over a multiyear period. As Dan mentioned, we entered 2022 with a solid backlog of information deliverables, which gives us confidence in our ability to continue our growth trend for these products. On an annual basis, we finished the year with $16.9 million in revenue compared to $545,000 in 2020. On a pro forma basis, our full year revenue was $18.9 million compared to $12.3 million in the prior year resulting in a 53% year-over-year growth rate. The net loss for the fourth quarter increased…

Operator

Operator

Thank you. I would like to turn it back over to the company to answer some questions.

Dan Barton

Management

Thank you. This is Dan Barton. We did have one write-in question I'd like to address before try to get back over to the line for questions and that question was what steps are the company taking to improve the stock price. The first thing, I would say, is we focus our efforts on the things that we can control. And first and foremost, it's our priority to execute against our operating plan. And based upon the last year, I believe we have demonstrated success in that area as evidenced by the strong financial results we just spoke about and some of the operating highlights that we shared on this call. After that we're actively gaining more exposure to interested new institutions. We're working with analysts towards gaining coverage. And we're continuing to provide an improved transparency to show investors things as – such as our organic rate of growth, especially in the or specifically in the healthcare information product line, which we believe is appealing to them. And with that, I'll turn it back to the operator for questions from the line.

Operator

Operator

Thank you. [Operator Instructions] And our first question comes from Gerard Payman [ph] from private investor. Your line is now open.

Unidentified Analyst

Analyst

Hello, gentlemen. Hi. I just wanted to ask a question relating to what was the rate of growth in 2021 in your healthcare data and analytical segments and if you could possibly a little color looking forward as well. Thank you.

Dan Barton

Management

Yes, sure. Hi. Thanks for the question. So, in 2021, our healthcare business grew from about $545,000 to $7.1 million and that was primarily driven by two things. One is investment in our data assets. We increased our portfolio of data information, including some additional closed network data. And then we also made some investments in our sales and delivery teams to be able to compile the products and delivered them to our customers. The good news about the business is many of the sales we make are multi-year contracts, so we have recurring deliverables to these customers and we feel we're entering 2022 with a strong backlog. So, if you look at 2021, majority of our growth, as I mentioned, was driven by our healthcare products and our view into 22 is the same thing. We expect a lot of the growth that we gave previously in our outlook to be driven by continued growth in our healthcare analytics business.

Unidentified Analyst

Analyst

Thank you very much.

Operator

Operator

Thank you. [Operator Instructions]

Operator

Operator

And I am showing no further questions. This concludes today's conference call. Thank you for participating. You may now disconnect.