VANCOUVER, B.C. – July 30, 2015 – CRH Medical Corporation (TSX: CRH) (OTCQX: CRMMF) (“CRH” or the “Company”), a North American medical company that provides physicians with innovative products and services for the treatment of gastrointestinal diseases, today announced its unaudited interim financial results for the quarter ended June 30, 2015. All financial results are expressed in U.S. dollars.
Q2 and YTD 2015 Financial Highlights
(All amounts in US$)
| June 30, | June 30, | YTD | YTD | |||||
| 2015 | 2014 | Change | 2015 | 2014 | Change | |||
| Anesthesia services | 8,513,842 | – | NA | 15,970,973 | – | NA | ||
| Product sales | 2,367,582 | 2,046,216 | 16% | 4,530,101 | 4,037,440 | 12% | ||
| Total Revenue | 10,881,424 | 2,046,216 | 432% | 20,501,074 | 4,037,440 | 408% | ||
| Operating expenses – adjusted1 | ||||||||
| Product sales | 981,309 | 917,389 | 7% | 1,885,495 | 1,784,304 | 6% | ||
| Anesthesia services | 3,459,879 | – | NA | 6,444,038 | – | NA | ||
| Corporate | 664,758 | 514,712 | 29% | 1,303,062 | 948,358 | 37% | ||
| Total operating expenses – adjusted1 | 5,105,946 | 1,432,101 | 257% | 9,632,595 | 2,732,662 | 252% | ||
| Total operating EBITDA1 | 5,775,478 | 614,115 | 840% | 10,868,479 | 1,304,778 | 733% | ||
| 1 | Non-IFRS Measure. Refer to page 5 of this document for reconciliation of reported results to non-IFRS measures. | |||||||
“The financial results for the second quarter of 2015 continue to demonstrate the financial strength of the anesthesia services business the Company entered into last year. Product sales from the CRH O’Regan System were the highest of any quarter in the Company’s history,” said Edward Wright, Chief Executive Officer of CRH. Edward added, “We continue to evaluate potential anesthesia services businesses, and continue to believe there is a significant opportunity for CRH to grow through acquisition in the second half of 2015 and beyond.”
Second Quarter 2015, Conference Call Notification
CRH Medical will host a telephone conference call to discuss the quarter on Thursday, July 30, 2015 at 10 am ET. The telephone numbers for the conference call are (877) 291-4570 or (647) 788-4919.
At the call’s completion, an audio replay will be available by calling (800) 585-8367 or (416) 621-4642 and using passcode 92572263. The phone replay will be available until August 14, 2015.
Q2 and YTD 2015 Financial Results
Total revenues for the three months ended June 30, 2015 were $10,881,424 compared to $2,046,216 for the three months ended June 30, 2014. Revenues for the six months ended June 30, 2015 were $20,501,074 compared to $4,037,440 for the six months ended June 30, 2014.
Revenues from anesthesia services were $8,513,842 in the quarter. This represents three months of activity from both the Company’s most recent acquisition in March 2015 and three months of activity from its initial anesthesia services acquisition in December 2014. Revenues in the year to date period were $15,970,973. During the quarter, the anesthesia services segment serviced 15,339 patient cases, and serviced 27,334 patient cases in the year to date.
Revenues from product sales for the quarter were $2,367,582 compared to $2,046,216 for the second quarter of 2014. The 16% increase in product sales is the result of the continuing successful execution of the Company’s direct to physician program that provides physicians the ability to purchase our hemorrhoid banding technology, treatment protocols, marketing and operational experience. Revenues from product sales for the six months ended June 30, 2015 were $4,530,101, an increase of 12% over the prior year comparable period. As of June 30, 2015 the Company had trained 2,066 physicians to use the CRH O’Regan System, representing 767 clinical practices, which compares to 1,765 physicians trained, representing 643 clinical practices, as of June 30, 2014.
For the quarter ended June 30, 2015, total adjusted operating expenses were $5,105,946 compared to $1,432,101 for the second quarter of 2014, an increase of $3,673,845. For the six months ended June 30, 2015, total adjusted operating expenses were $9,632,595 compared to $2,732,662 for the six months ended June 30, 2014.
Anesthesia services adjusted operating expenses for the quarter ended June 30, 2015 were $3,459,879. Anesthesia services adjusted operating expenses for the six months ended June 30, 2015 were $6,444,038. Anesthesia services expenses primarily include labor related cost for the medical director and certified registered nurse anesthetists, medical drugs and supplies, and billing and management related expenses.
Product sales adjusted operating expenses for the quarter were $981,309 compared to $917,389 for the quarter ended June 30, 2014. Product sales adjusted operating expenses for the year to date were $1,885,495 compared to $1,784,304 for the comparable period. The increase in expenses is a reflection of the increased sales in the quarter. Product sales expenses primarily include employee wages, product cost and support, marketing programs, office expenses, professional fees, and insurance. As many of these costs are, by nature, fixed, this has contributed to product sales growth outpacing the increase in expenses during the quarter.
Corporate adjusted operating expenses for the quarter were $664,758 compared to $514,712 for the quarter ended June 30, 2014. This reflects a growth in expenses of $150,046 from the second quarter of 2014. Corporate adjusted operating expenses for the six months ended June 30, 2015 were $1,303,062 compared to $948,358, a growth of $354,704. The growth in corporate expenses is primarily the result of an increase in employee related costs and professional fees and, in general, is reflective of the additional activities incurred in support of the Company’s expanded service offering.
Operating EBITDA for the quarter was $5,775,478, an increase of $5,161,363 over the second quarter of 2014. Operating EBITDA for the six months ended June 30, 2105 was $10,868,479, an increase of $9,563,701 from the comparable period in the prior year. The increases are primarily a reflection of the Company’s newly acquired anesthesia service providers offset by increases in product and corporate operating expenses.
The Company’s June 30, 2015 financial report and corresponding MD&A are available on www.sedar.com and the Company’s website at www.crhmedcorp.com.