Toronto, Ontario--(Newsfile Corp. - March 5, 2025) - CareRx Corporation (TSX: CRRX) ("CareRx" or the "Company"), Canada's leading provider of pharmacy services to seniors living and other congregate care communities, today reported its financial results for the fourth quarter ended December 31, 2024.
"Throughout 2024, CareRx has continued to strengthen its financial and operational performance, positioning itself for the growth opportunities in the coming year," said Puneet Khanna, President and Chief Executive Officer. "Our investments in operational efficiency and automation have enhanced our ability to scale without a proportional increase in costs, contributing to a stronger balance sheet. This solid foundation enables us to pursue strategic opportunities while maintaining a disciplined approach to capital allocation. As we enter the next phase of growth, we remain committed to enhancing our service offerings for home operator partners and residents while delivering long-term value to our shareholders."
Highlights for the Fourth Quarter of 2024
Revenue for the quarter was $92.2 million as compared to $92.8 million for the third quarter of 2024 and $91.1 million for the fourth quarter of 2023:
The Company's revenue decrease as compared to the third quarter of 2024 was primarily due to a net reduction in the average number of beds serviced; and
Increase as compared to the fourth quarter of 2023 was primarily due to an increase in branded pharmaceutical prices during the third quarter of 2024.
Adjusted EBITDA1 for the quarter was $7.6 million as compared to $7.8 million for the third quarter of 2024 and $7.5 million for the fourth quarter of 2023:
Decrease as compared to the prior quarter was due to a net reduction in the average number of beds serviced; and
Increase as compared to the same period in the prior year was due to certain efficiencies and cost savings initiatives that commenced during the second half of 2023 and improved supply terms as a result of the amendment to the existing agreement with the Company's principal pharmaceutical wholesaler effective April 1, 2024.
Net loss for the quarter was $2.2 million as compared to a net loss of $0.4 million for the third quarter of 2024 and net loss of $3.7 million for the fourth quarter of 2023:
Increase in net loss compared to the prior quarter was primarily due to increase in share-based compensation expense; and
Decrease in net loss as compared to the same period in the prior year was driven primarily by a decrease in finance costs; partially offset by an increase in share-based compensation expense, and income tax recovery recorded during the second quarter of 2023 as compared to nominal income tax expense recorded during the fourth quarter of 2024.
In December 2024, the Company opened a new state-of-the-art pharmacy in North Burnaby, British Columbia. The facility is designed to enhance service delivery for the homes and residents serviced by the Company throughout the B.C. lower mainland, while improving the employee experience through optimized workflows, streamlined operations and leading-edge medication packaging technology. With this expansion, the Company began consolidating its existing Burnaby and Vancouver pharmacy operations into the new North Burnaby location.
1See "Non-IFRS Measures" below
"In November 2024, the final tranche of the Company's unsecured convertible debentures originally issued on November 22, 2019, was converted into common shares at a price of $3.00 per share," said Suzanne Brand, Chief Financial Officer of CareRx. "This milestone completes our comprehensive debt restructuring initiative, which has simplified our balance sheet and significantly reduced annual interest expense. Year-over-year, we have decreased total debt by $21.8 million, putting our balance sheet in the strongest position it has been in recent years."
FINANCIAL RESULTS
Selected Financial Information
For the three month periods ended December 31,
For the years ended December 31,
(Thousands of Canadian dollars except per share amounts and percentages)
2024
2023
2022
2024
2023
2022
$
$
$
$
$
$
Revenue
92,181
91,097
94,319
366,714
370,746
381,727
EBITDA1
4,686
5,486
4,516
23,840
24,697
(888)
Adjusted EBITDA1
7,560
7,505
7,144
30,297
28,673
32,267
Per share - Basic
$0.12
$0.13
$0.15
$0.50
$0.50
$0.68
Adjusted EBITDA Margin1
8.2%
8.2%
7.6%
8.3%
7.7%
8.5%
Net loss
(2,245)
(3,700)
(4,680)
(4,501)
(5,405)
(34,353)
Per share - Basic and Diluted
($0.04)
($0.06)
($0.10)
($0.07)
($0.09)
($0.72)
Cash provided by operations
8,401
8,762
14,190
37,991
27,375
22,333
Total Assets
223,538
231,893
264,535
223,538
231,893
264,535
Total Liabilities
139,310
150,367
200,078
139,310
150,367
200,078
1 See "Non-IFRS Measures" below.
Conference Call
The Company will host a conference call, including a slide presentation, to discuss its fourth quarter of 2024 and the full year ended December 31, 2024 financial results on Wednesday, March 5, 2025 at 8:30 a.m. Eastern Time (ET).
Telephone Dial-In Access Information
To dial direct and enter the call through an operator, dial 647-484-8814 or 1-844-763-8274. Please connect approximately 15 minutes prior to the beginning of the call to ensure participation. Those participating in the conference call by telephone can view the slide presentation by accessing the online webcast (see instructions below) and choosing the Non-Streaming Audio option.
Webcast Access Information
A live webcast of the conference call, including the slide presentation, will be available on the Events and Presentations page of the Investors section of the Company's website (https://carerx.ca/presentations/). Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. To view the webcast presentation with slides, please choose either the Real Streaming Audio or Windows Streaming Audio option.
The webcast with slide presentation will be archived for 90 days on the Events and Presentations page of the Investors section of the Company's website (https://carerx.ca/presentations/).
About CareRx Corporation
CareRx is Canada's leading provider of pharmacy services to seniors living communities. We serve approximately 88,000 residents in approximately 1,450 seniors and other congregate care communities (long-term care homes, retirement homes, assisted living facilities, and group homes). We are a national organization with a large network of pharmacy fulfillment centres strategically located across the country. This allows us to deliver medications in a timely and cost-effective manner and quickly respond to routine changes in medication management. We use best-in-class technology that automates the preparation and verification of multi-dose compliance packaging of medication, providing the highest levels of safety and adherence for individuals with complex medication regimens. We take an active role in working with our home operator partners to promote resident health, staff education, and medication system quality and efficiency.
For additional information, please contact:
Puneet Khanna President & Chief Executive Officer CareRx Corporation 416-927-8400
This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding the Company's business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate" or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management.
Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated by such statements. Factors that could cause such differences include the Company's general business risks, the Company's exposure to and reliance on government regulation and funding, risks related to employee recruitment and retention, the Company's liquidity and capital requirements, exposure to epidemic or pandemic outbreak, reliance on contracts with key care operators and other risk factors described from time to time in the reports and disclosure documents filed by the Company with Canadian securities regulatory agencies and commissions. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. As a result of the foregoing and other factors, no assurance can be given as to any such future results, levels of activity or achievements and neither the Company nor any other person assumes responsibility for the accuracy and completeness of these forward-looking statements. The factors underlying current expectations are dynamic and subject to change.
Non-IFRS Measures
This press release includes certain measures which have not been prepared in accordance with IFRS such as "EBITDA", "Adjusted EBITDA", "Adjusted EBITDA Margin" and "Adjusted EBITDA per share". These non-IFRS measures are not recognized under IFRS and, accordingly, shareholders are cautioned that these measures should not be construed as alternatives to net income determined in accordance with IFRS. The non-IFRS measures presented are unlikely to be comparable to similar measures presented by other issuers.
The Company defines "EBITDA" as earnings before depreciation and amortization, finance costs, net, and income tax expense (recovery). "Adjusted EBITDA" is defined as EBITDA before transaction, restructuring and other costs, change in fair value of contingent consideration liability, impairments, change in fair value of derivative financial instruments, change in fair value of investment, (gain) loss on disposal of property and equipment and share-based compensation expense. "Adjusted EBITDA Margin" is defined as Adjusted EBITDA divided by revenue. "Adjusted EBITDA per share" is defined as Adjusted EBITDA divided by the weighted average outstanding shares. 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 interest and principal debt repayments and fund future growth initiatives. The Company's agreements with lenders are also structured with certain financial performance covenants which includes Adjusted EBITDA as a key component of the covenant calculation. EBITDA and Adjusted EBITDA are not recognized measures under IFRS.
Reconciliation of Non-IFRS Measures
For the three month periods ended December 31,
For the years ended December 31,
2024
2023
2024
2023
(Thousands of Canadian Dollars except per share amounts)
$
$
$
$
Net loss
(2,245)
(3,700)
(4,501)
(5,405)
Depreciation and amortization
4,784
4,946
19,190
19,976
Finance costs, net
2,115
4,413
9,119
14,316
Income tax expense (recovery)
32
(173)
32
(4,190)
EBITDA
4,686
5,486
23,840
24,697
Transaction, restructuring and other costs
307
633
1,490
1,445
Change in fair value of contingent consideration liability
17
18
(125)
230
Goodwill and intangible assets impairment
-
710
764
710
Share-based compensation expense
2,315
449
3,652
1,471
Change in fair value of derivative financial instruments
-
-
-
(281)
Loss on disposal of assets
235
209
676
401
Adjusted EBITDA
7,560
7,505
30,297
28,673
Weighted average number of shares - basic (in thousands)
