Release Date: August 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Viemed Healthcare Inc (VMD, Financial) achieved a record net revenue of $55 million for the second quarter of 2024, marking a 27% increase over the previous year.
- The company successfully integrated East Alabama HomeMed, expanding its workforce to 1,121 employees and setting a framework for future joint venture opportunities.
- Sales force restructuring initiatives led to a 15% increase in average monthly setups per sales rep, enhancing overall sales performance.
- The company's sleep business experienced strong organic growth, now representing 15% of the revenue mix, with a double-digit quarterly growth rate.
- Viemed Healthcare Inc (VMD) is leveraging technology and machine learning tools to improve processes, enhance patient care, and optimize claim processes.
Negative Points
- The Philips recall of older ventilators, while presenting an opportunity, requires careful management to replace affected devices without impacting cash flows.
- General and administrative expenses increased to $26.5 million, up from $20.6 million in the second quarter of 2023, though they decreased as a percentage of revenue.
- The company faced a $2.2 million impact from reserves related to a former vendor's bankruptcy and an impairment on an investment.
- The Change Healthcare cybersecurity issue led to increased accounts receivable, with approximately $4 million still outstanding as of June 30.
- Despite strong financial performance, the stock market's perception of the sector, potentially influenced by the GLP-1 craze, has led to a low EBITDA multiple for Viemed Healthcare Inc (VMD).
Q & A Highlights
Q: It feels like you're in a target-rich environment. Are you prioritizing the best opportunities or taking broader shots?
A: Casey Hoyt, CEO: We're being efficient and strategic, focusing on cross-selling across all product lines. Our sales restructuring has improved management and training, allowing us to recruit more aggressively. Todd Zehnder, COO: We are careful and prudent with our opportunities, ensuring we don't miss often.
Q: Do you see opportunities to replicate the JV structure in other markets?
A: Casey Hoyt, CEO: Yes, we're proving the model with HomeMed and expect to have data to present to future opportunities by year's end. This will help us pitch our value proposition to other potential partners.
Q: Is the Philips recall and buyback a positive for you?
A: Todd Zehnder, COO: Yes, it's been positive. We've sold back about 15% of our fleet and are replacing it at a cost advantage. We've recorded an accounting gain and it's been beneficial for both the company and patients.
Q: How much does the sleep and resupply program contribute to equipment and supply sales?
A: Todd Zehnder, COO: The primary driver is our sleep resupply program, which has grown significantly. It has zero CapEx and is all cash flow, and we expect it to continue growing.
Q: Is there seasonality in the service revenue segment?
A: Todd Zehnder, COO: No significant seasonality. Our healthcare staffing division has expanded with new contracts, and we expect continued growth without large fluctuations.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
