NEW YORK, Sept. 16, 2020 (GLOBE NEWSWIRE) -- Conversion Labs, Inc. (OTCQB: CVLB), a direct-to-consumer telemedicine and wellness company, has completed its previously announced equity investment by a select group of private investors and family offices, including investors David Blitzer and Wes Edens, for $3.5 million. Conversion Labs also submitted this week its application to list the company’s common stock on the Nasdaq Capital Market®.
“In addition to the tremendous affirmation of our business strategy and growth prospects these investors represent, their capital contribution advances us toward satisfying the listing requirements for Nasdaq,” commented Conversion Labs CEO, Justin Schreiber. “As the world’s top exchange for emerging growth stocks, we expect a Nasdaq listing to increase our corporate visibility and broaden awareness of our success in the financial community.”
“We anticipate a Nasdaq listing will open the door to a larger pool of investors, particularly institutional and retail, and help drive greater shareholder value,” continued Schreiber. “These multiple benefits will be timely, as we expect to soon announce a number of new telemedicine products that will leverage our record customer growth and the vast market opportunities that continue to emerge in telehealth.”
Over the last year, Conversion Labs has made great strides in strengthening its operational and financial performance which have positioned it for future growth and profitability. The company’s new cloud-based, video-powered telemedicine platform, Veritas MD, has been designed to support the continued rapid scale up and market expansion of the company’s telehealth brands, while providing easier, more convenient and affordable access for patients seeking personalized treatment by board-certified physicians.
The company annualized revenue run-rate recently exceeded $44.0 million compared to $12.5 million for all of 2019—a more than three-fold increase. The growth in revenue has been largely driven by the company’s increasingly popular proprietary brands and formulas that include Rex MD and Shapiro MD.
Subscriptions to these products increased the company’s annual recurring revenue (ARR) to $17.2 million by the end of August, which was up by $14.0 million or 437% compared to August of last year. The month-to-month increase from July had jumped by a record $2.4 million.
“Our accelerating performance with subscription revenue reflects how we are attracting loyal customers who value the convenience and security that our telehealth platform provides,” added Schreiber. “As we launch additional telemedicine offerings and products, we expect our growth to continue its upward trajectory as improving economies of scale drive greater margin expansion.”
In addition to delivering highly-effective products and services, the company has been benefiting from the growing adoption of telemedicine across the health care industry. According to Forrester Research, telehealth has “shifted into hyper-drive,” with virtual health care visits on pace to top 1 billion by year end. The telemedicine market is expected to grow at 19.3% CAGR, reaching $175 billion by 2026.
Acceptance for listing the company’s shares is subject to approval based on several factors, including satisfaction of minimum listing requirements for the Nasdaq Capital Market. The company intends to satisfy all of the applicable listing requirements; however, there is no assurance that its application will be approved. During the Nasdaq review process, the company’s common stock will continue to trade in the U.S. on The OTC Markets under its current symbol, CVLB.
About Nasdaq
Nasdaq, Inc. (Nasdaq: NDAQ) is a global technology company serving the capital markets and other industries. Its diverse offering of data, analytics, software and services enables clients to optimize and execute their business vision with confidence. The Nasdaq Stock Market is a trusted pillar of capital markets and innovation, providing U.S. equity markets liquidity, resiliency and transparency that propel investment ideas to fruition. For more about Nasdaq, go to www.nasdaq.com.
About Conversion Labs
Conversion Labs, Inc. is a telemedicine company with a portfolio of online direct-to-consumer brands. The company’s brands combine virtual medical treatment with prescription medications and unique over-the-counter products. Its network of licensed physicians offers telemedicine services and direct-to-consumer pharmacy to consumers across the U.S. To learn more, visit Conversionlabs.com.
Annual Recurring Revenue (ARR)
Conversion Labs calculates annual recurring revenue (ARR) by multiplying by 12 the monthly sum of revenue attributed exclusively to automatic subscription sales from customers that are engaged in the company’s rebill structure for the brands of Shapiro MD, Rex MD and PDFSimpli. In the company’s calculation of ARR, it does not consider sales from customers that repurchase its products themselves in the company’s checkout pages, Amazon Marketplace or through assistance of the company’s customer service representatives, since those sales have a marginal advertising/marketing expense associated with the respective sale. The company also does not consider the revenue attributed to the initial purchase upon acquisition of the respective customer.
Important Cautions Regarding Forward-Looking Statements
This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, regarding, among other things our plans, strategies and prospects -- both business and financial. Although we believe that our plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Many of the forward-looking statements contained in this news release may be identified by the use of forward-looking words such as "believe," "expect," "anticipate," "should," "planned," "will," "may," "intend," "estimated," and "potential," among others. Important factors that could cause actual results to differ materially from the forward-looking statements we make in this news release include market conditions and those set forth in reports or documents that we file from time to time with the United States Securities and Exchange Commission. All forward-looking statements attributable to Conversion Labs, Inc. or a person acting on its behalf are expressly qualified in their entirety by this cautionary language.
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Conversion Labs
Juan Manuel Piñeiro Dagnery
CFO
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