Streamline Health® Reports First Quarter 2021 Financial Results

Atlanta, GEORGIA


First quarter 2021 Revenues of $3.0 million; ($2.1 million) Net Loss; ($0.7 million) Adjusted EBITDA

Atlanta, GA, June 08, 2021 (GLOBE NEWSWIRE) -- Streamline Health Solutions, Inc. (NASDAQ: STRM), provider of the eValuator Revenue Integrity Program to help healthcare providers proactively address revenue leakage and compliance exposure, today announced financial results for the first quarter of fiscal year 2021, which ended April 30, 2021.

Total revenues for the first quarter of fiscal 2021 were $3.0 million, compared to $2.8 million in the prior year period. SaaS revenue was up $287,000, approximately 32%, compared to the same quarter a year ago. The revenue growth during the quarter was driven by higher revenue from SaaS and software licenses offset by lower revenue from professional services, audit services and maintenance and support. Recurring revenue comprised 76% of first quarter fiscal 2021 revenue compared to 76% of first quarter fiscal 2020 revenue.

Net loss for the first quarter of fiscal 2021 was ($2.1 million) as compared to a net income of $3.7 million during the first quarter of fiscal 2020. First quarter fiscal 2021 net loss included $320,000 income from discontinued operations of the Company’s legacy ECM business which closed February 24, 2020, compared to $4.7 million of income from discontinued operations during the first quarter of fiscal 2020. Income from discontinued operations was offset by a loss from continuing operations for the three months ended April 30, 2021 and 2020 of ($2.5 million) and ($1.0 million), respectively.

Adjusted EBITDA for the first quarter of fiscal 2021 was a loss of ($0.7 million), compared to an adjusted EBITDA loss of ($0.6 million) in the first quarter of fiscal 2020.

“I remain excited about the opportunities for revenue growth via our eValuator solution. As the healthcare provider industry recovers from the Coronavirus crisis, I believe we will see a return to more normal technology purchasing patterns. This won’t happen overnight, but we are seeing signs that the ROI our eValuator technology delivers helps us get to the top of the new initiative list with many of our prospects,” stated Tee Green, President and Chief Executive Officer, Streamline Health.

“With the expansion of our direct sales force, and the addition of new, large reseller agreements, I believe we are well positioned to gain the attention of more large healthcare providers that need pre-bill coding analysis to ensure their revenue integrity.”

Highlights from the first quarter ended April 30, 2021 included:

  • Revenue for the first quarter of fiscal 2021 was $3.0 million; SaaS revenue grew 12% compared to the fourth quarter of fiscal 2020;
  • Loss from continuing operations for the first quarter of fiscal 2021 was ($2.5 million);
  • Adjusted EBITDA for the first quarter of fiscal 2021 was ($0.7 million);
  • Total bookings (total contract value) for the first quarter of fiscal 2021 were $2.6 million.

Conference Call

The Company will conduct a conference call to review the results on Wednesday, June 9, 2021 at 9:00 AM ET. Interested parties can access the call by joining the live webcast: click here to register. You can also join by phone by dialing 877-407-8291.

A replay of the conference call will be available from Wednesday, June 9, 2021 at 12:00 PM ET to Wednesday, June 16, 2021 at 12:00 PM ET by dialing 877-660-6853 or 201-612-7415 with conference ID 13719851. An online replay of the presentation will also be available for six months following the presentation in the Investor Relations section of the Streamline Health website, www.streamlinehealth.net.

Non-GAAP Financial Measures

Streamline Health reports its financial results in accordance with U.S. generally accepted accounting principles ("GAAP"). Streamline Health's management also evaluates and makes operating decisions using various other measures. One such measure is adjusted EBITDA, which is a non-GAAP financial measure. Streamline Health's management believes that this measure provides useful supplemental information regarding the performance of Streamline Health's business operations.

Streamline Health defines "adjusted EBITDA" as net earnings (loss) plus interest expense, tax expense, depreciation and amortization expense of tangible and intangible assets, stock-based compensation expense, significant non-recurring operating expenses, and transactional related expenses including: gains and losses on debt and equity conversions, associate severances and related restructuring expenses, associate inducements, and professional and advisory fees. A table illustrating this measure is included in this press release.

About Streamline Health

Streamline Health Solutions, Inc. (NASDAQ: STRM) is a leader in pre-bill revenue integrity solutions for healthcare providers. Our eValuator Revenue Integrity Program includes integrated solutions, technology-enabled services and analytics that drive compliant revenue and improved financial performance across the enterprise. We share a common calling and commitment to advance the quality of life and the quality of healthcare - for society, our clients, the communities they serve, and the individual patient. For more information, please visit our website at www.streamlinehealth.net.

Safe Harbor statement under the Private Securities Litigation Reform Act of 1995

Statements made by Streamline Health Solutions, Inc. that are not historical facts are forward-looking statements that are subject to certain risks, uncertainties and important factors that could cause actual results to differ materially from those reflected in the forward-looking statements included herein. Forward-looking statements contained in this press release include, without limitation, statements regarding the Company's growth prospects, estimates of backlog, industry trends and market growth, results of investments in sales and marketing, adjusted EBITDA, success of future products and related expectations and assumptions. These risks and uncertainties include, but are not limited to, the timing of contract negotiations and execution of contracts and the related timing of the revenue recognition related thereto, the potential cancellation of existing contracts or clients not completing projects included in the backlog, the impact of competitive solutions and pricing, solution demand and market acceptance, new solution development and enhancement of current solutions, key strategic alliances with vendors and channel partners that resell the Company's solutions, the ability of the Company to control costs, the effects of cost-containment measures implemented by the Company, availability of solutions from third party vendors, the healthcare regulatory environment, potential changes in legislation, regulation and government funding affecting the healthcare industry, healthcare information systems budgets, availability of healthcare information systems trained personnel for implementation of new systems, as well as maintenance of legacy systems, fluctuations in operating results, effects of critical accounting policies and judgments, changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other similar entities, changes in economic, business and market conditions impacting the healthcare industry generally and the markets in which the Company operates and nationally, and the Company's ability to maintain compliance with the terms of its credit facilities, and other risks detailed from time to time in the Streamline Health Solutions, Inc. filings with the U. S. Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof. The Company undertakes no obligation to publicly release the results of any revision to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law.

Contact
Randy Salisbury
SVP, Chief Sales & Marketing Officer
(404) 229-4242
Randy.salisbury@streamlinehealth.net

STREAMLINE HEALTH SOLUTIONS, INC.
CONSOLIDATED AND CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)

  Three Months Ended 
  April 30, 
  2021  2020 
Revenues:      
Systems sales $135,000  $- 
Professional services  78,000   152,000 
Audit Services  504,000   544,000 
Maintenance and support  1,057,000   1,258,000 
Software as a service  1,177,000   890,000 
Total revenues  2,951,000   2,844,000 
         
Operating expenses:        
Cost of systems sales  137,000   77,000 
Cost of professional services  214,000   242,000 
Cost of audit services  389,000   360,000 
Cost of maintenance and support  87,000   186,000 
Cost of software as a service  610,000   405,000 
Selling, general and administrative  2,551,000   2,291,000 
Research and development  977,000   684,000 
Non-routine costs  441,000   - 
Loss on exit of membership agreement  -   105,000 
 Total operating expenses  5,406,000   4,350,000 
Operating loss  (2,455,000)  (1,506,000)
Other expense:        
Interest expense  (13,000)  (14,000)
Miscellaneous expense  15,000   (18,000)
Loss before income taxes  (2,453,000)  (1,538,000)
Income tax benefit  (9,000)  561,000 
Loss from continuing operations $(2,462,000) $(977,000)
         
Gain on sale of discontinued operations  -   6,009,000 
Income from discontinued operations  320,000   137,000 
Income tax benefit (expense)  -   (1,496,000)
Income from discontinued operations  320,000   4,650,000 
Net (loss) income $(2,142,000) $3,673,000 
         
Basic Earnings per Share:        
Continuing operations $(0.07) $(0.03)
Discontinued operations  0.01   0.16 
Net (loss) income $(0.06) $0.13 
         
Weighted average number of common shares - basic  37,497,958   29,767,814 
         
Diluted Earnings per Share:        
Continuing operations $(0.07) $(0.03)
Discontinued operations  0.01   0.15 
Net (loss) income $(0.06) $0.12 
         
Weighted average number of common shares – diluted  38,184,765   30,037,716 

STREAMLINE HEALTH SOLUTIONS, INC.
CONSOLIDATED AND CONDENSED BALANCE SHEETS
(Unaudited)

Assets
  April 30,  January 31, 
   2021   2021 
Current assets:        
Cash and cash equivalents $16,727,000  $2,409,000 
Accounts receivable, net  3,187,000   2,929,000 
Contract receivables  257,000   174,000 
Prepaid and other current assets  1,331,000   1,216,000 
Current assets from discontinued operations  110,000   587,000 
Total current assets  21,612,000   7,315,000 
         
Non-current assets:        
Property and equipment, net  83,000   104,000 
Right of use asset on operating lease  349,000   391,000 
Capitalized software development costs, net  5,818,000   5,945,000 
Intangible assets, net  509,000   624,000 
Goodwill  10,712,000   10,712,000 
Other non-current assets  947,000   873,000 
Long-term assets from discontinued operations  11,000   13,000 
Total non-current assets  18,429,000   18,662,000 
  $40,041,000  $25,977,000 
         
Liabilities and Stockholders' Equity
Current liabilities:        
Accounts payable $243,000  $272,000 
Accrued expenses  1,053,000   908,000 
Current portion of term loan  2,301,000   1,534,000 
Deferred revenues  4,983,000   3,862,000 
Current portion of operating lease obligation  199,000   198,000 
Current liabilities from discontinued operations  358,000   595,000 
Total current liabilities  9,137,000   7,369,000 
         
Non-current liabilities:        
Term loan, net of current portion  -   767,000 
Deferred revenues, less current portion  170,000   130,000 
Operating Lease obligations, less current portion  176,000   222,000 
Total non-current liabilities  346,000   1,119,000 
Total liabilities  9,483,000   8,488,000 
         
Stockholders' equity  30,558,000   17,489,000 
  $40,041,000  $25,977,000 

STREAMLINE HEALTH SOLUTIONS, INC.
CONSOLIDATED AND CONDENSED STATEMENT OF CASH FLOWS
(Unaudited)

  Three Months Ended 
  April 30, 
  2021  2020 
Cash flows from continuing operating activities:        
Loss from continuing operations $(2,462,000) $(977,000)
Depreciation  21,000   14,000 
Amortization of capitalized software development costs  506,000   289,000 
Amortization of intangible assets  115,000   123,000 
Amortization of other deferred costs  116,000   75,000 
Valuation adjustments  -   17,000 
Loss on exit of membership agreement  -   105,000 
Share-based compensation expense   565,000   263,000 
Benefit for accounts receivable allowance  -   (15,000)
Benefit for income taxes  -   (561,000)
Changes in assets and liabilities  661,000   (1,236,000)
Net cash used in operating activities  (478,000)  (1,903,000)
Net cash from operating activities - discontinued operations  560,000   (2,270,000)
         
Cash flows used in investing activities:        
Capitalization of software development costs  (378,000)  (479,000)
Proceeds from sale of ECM assets  -   11,284,000 
Net cash provided by (used in) investing activities  (378,000)  10,805,000 
Net cash used in investing activities - discontinued operations  -   - 
         
Cash flows from financing activities:        
Proceeds from issuance of common stock  16,100,000   - 
Payments for costs on issuance of common stock  (1,293,000)  - 
Proceeds from term loan  -   2,301,000 
Principal payments on term loan  -   (4,000,000)
Other  (193,000)  (22,000)
Net cash used in financing activities  14,614,000   (1,721,000)
Net decrease in cash and cash equivalents  14,318,000   4,911,000 
Cash and cash equivalents at beginning of year  2,409,000   1,649,000 
Cash and cash equivalents at end of year  16,727,000  $6,560,000 

STREAMLINE HEALTH SOLUTIONS, INC.
New Bookings
(Unaudited)

  April 30, 2021
  Three Months Ended
Systems Sales$135,000
Professional Services 199,000
Audit Services 386,000
Maintenance and Support 135,000
Software as a Service 1,725,000
Q1 2021 Bookings$2,580,000
Q1 2020 Bookings$1,285,000


STREAMLINE HEALTH SOLUTIONS, INC.
Reconciliation of loss from continuing operations to non-GAAP Adjusted EBITDA
(in thousands)
(Unaudited)

  Three Months Ended April 30, 
  2021  2020 
Loss from continuing operations $(2,462) $(977)
Interest expense  13   14 
Income tax (benefit) expense  9   (561)
Depreciation  21   14 
Amortization of capitalized software development costs  506   289 
Amortization of intangible assets  115   123 
Amortization of other costs  116   75 
EBITDA  (1,682)  (1,023)
Share-based compensation expense  565   263 
Non-cash valuation adjustments  -   17 
Loss on exit of operating lease  -   105 
Non-routine costs  457   - 
Adjusted EBITDA $(660) $(638)
Adjusted EBITDA per diluted share:        
Net loss per common share – diluted $(0.07) $(0.03)
Adjusted EBITDA per adjusted diluted share (1) $(0.02) $(0.02)
         
Diluted weighted average shares (2)  37,497,958   29,767,814 
Includable incremental shares - Adjusted EBITDA (3)  686,807   269,902 
Adjusted diluted shares  38,184,765   30,037,716 

(1) Adjusted EBITDA per adjusted diluted share for our common stock is computed using the treasury stock method.

(2) Diluted EPS for our common stock was computed using the treasury stock method.

(3) The number of incremental shares that would be dilutive under an assumption that the Company is profitable during the reported period, which is only applicable for a period in which the Company reports a GAAP net loss. If a GAAP profit is earned in the reported periods, no additional incremental shares are assumed.