Streamline Health® Reports First Quarter 2021 Financial Results

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 firstquarter ended April 30, 2021included:

  • 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.


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