- 92% of Q1 2021 revenue was generated by subscriptions, up from 75% in Q1 2020
- Total patients and customers served nationwide surpassed 320,000
- Gross Margins of 82%, up 13% from the same year-ago period
- Total Telehealth Order volume grew by 373% versus year ago period to 164,452
NEW YORK, May 13, 2021 (GLOBE NEWSWIRE) -- LifeMD, Inc. (“the Company”) (NASDAQ: LFMD), a leading direct-to-patient telehealth company, today reported results for the first quarter ended March 31, 2021. All quarterly comparisons are to the same year-ago period. The Company will hold a conference call at 4:30 p.m. Eastern time today to discuss the results (see dial-in information below.)
| ($ in 000s) | Three Months Ended March 31 | Y-o-Y | ||
| Key Performance Metrics | 2021 | 2020 | % Growth | |
| Revenue | ||||
| Product (Telehealth) | $13,283 | $2,956 | 349% | |
| Software (LegalSimpli) | 4,914 | 1,349 | 264% | |
| Total Revenue | $18,198 | $4,305 | 323% | |
| Subscription Revenue as % of Total | 92% | 75% | ||
| Telehealth Volume | ||||
| Total Telehealth Orders | 164,452 | 34,753 | 373% | |
| LegalSimpli | ||||
| Active Subscribers | 109,517 | 36,852 | 197% | |
Q1 Financial Highlights
- Revenue increased 323% to a record $18.2 million.
- 92% of Q1 2021 revenue was generated by subscriptions, up from 75% in Q1 2020.
- Telemedicine orders increased 373% to more than 164,000.
- Gross profit increased 403% to $14.9 million or 82% of revenue.
- Cash totaled $13.4 million at March 31, 2021, versus $9.2 million at December 31, 2020. Subsequent to the end of the quarter, the Company completed a private placement with net proceeds of $13.5 million.
Q1 Operational Highlights
- Total patients and customers served nationwide surpassed 320,000.
- At the end of the first quarter of 2021, launched Nava MD™, a tele-dermatology and skincare brand that offers virtual medical treatment from dermatologists and other providers. Nava MD’s proprietary products leverage intellectual property and proprietary formulations licensed from Restorsea, a leading skincare technology platform.
- In the quarter, the Company changed its name from Conversion Labs to Life MD™, reflecting its evolution and expansion from a branded telemedicine products company into a leading provider of end-to-end concierge telehealth services.
- Expanded the management team with the appointments of a Chief Medical Officer, Chief Financial Officer, Chief Digital Officer, Chief Business Officer, and Corporate Controller.
Management Commentary
“As a rising leader in telehealth, we’re extremely pleased with the evolution of LifeMD into a powerful end-to-end patient-centric digital health platform. Having addressed the needs of over 320,000 patients and customers across 50 states, we are creating converts and advocates of virtual healthcare,” noted LifeMD Chairman and CEO, Justin Schreiber. “I’m especially pleased with the management and leadership team that have chosen to join LifeMD on our journey. We are a company which has been built from the ground up to support the expansion of telehealth and its new role in the transformation of patient care.”
“What has been encouraging in the new year, is just how quickly telehealth has been adopted to become a permanent part of the healthcare continuum. The new modality has eased the burden of physician workflow within the healthcare system and patients have embraced virtual treatment as a result of its improved cost, accessibility and convenience. In support of this rapid adoption, the Company is leveraging its digital technology platform with unlimited scalability across new verticals, products and services. As LifeMD continues to support the adoption of telehealth, we are now able to set the stage for balanced growth and multiple pathways to profitability,” concluded Mr. Schreiber.
Marc Benathen, CFO commented, “We are extremely pleased with LifeMD’s performance in the period as we continue to overlay new products, services and plan for launches into new healthcare indications and verticals. In doing so, we continue to ramp the business in support of growing revenues and an increasing subscriber base with the goal of working towards profitability. We have also recently begun to hone in on our KPI’s and unit economics and in doing so, reduced our cash burn on a go forward basis by approximately 30% due mostly to more efficient acquisition spend while maintaining an aggressive revenue growth trajectory. This burn will continue to further reduce as we scale our company. Based on the strong results of Q1 and continued momentum resulting from our strong recurring subscription revenue model, we are now increasing our Full Year 2021 Revenue Guidance to $90 to $100 million.”
Q1 2021 Financial Summary
- Revenue in the first quarter of 2021 increased 323% to a record $18.2 million from $4.3 million in the same year-ago quarter. The growth in revenue was primarily driven by a 349% increase in telemedicine product revenues.
- The company’s LegalSimpli subsidiary, a PDF software-as-a-service (SaaS), contributed net sales of $4.9 million, up 264% from the year-ago quarter.
- Including $1.3 million in deferred revenue associated with recurring subscriptions, adjusted revenues on a non-GAAP basis would total $19.5 million for the first quarter of 2021.
- Gross profit in the first quarter increased 403% to $14.9 million, compared to $3.0 million in the same year-ago quarter. Gross margin in the first quarter of 2021 increased to 82% from 69% in the same year-ago quarter. The increase of 13% was principally attributable to lower product costs, growth of our prescription business and more stringent inventory management.
- Operating expense in the first quarter of 2021 was $26.8 million, up from $4.7 million in the same year-ago quarter. The increase was primarily due to increases of selling and marketing expenses of $15.9 million driven by growth in discretionary customer acquisition spend, general and administrative expenses of $5.2 million, other operating expenses of $737,000, customer services expenses of $127,000, and development cost of $114,000. G&A expenses for first quarter of 2021 also included non-cash expenses for stock-based compensation and amortization of $2.3 million.
- Net loss attributable to common stockholders for the first quarter of 2021 was $11.6 million or $(0.47) per share, as compared to a net loss attributable to common stockholders of $2.4 million or $(0.23) per share in the first quarter of 2020.
- Excluding $2.3 million related to non-cash stock-based compensation expense, Adjusted EPS, a non-GAAP term, totaled a loss of $(0.38) per share for the first quarter of 2021 as compared to a loss of $(0.22) per share for the first quarter of 2020. (see definition of this non-GAAP term and reconciliation to GAAP, below).
- Adjusted EBITDA, a non-GAAP term, totaled a loss of $8.9 million in the first quarter of 2021, compared to an Adjusted EBITDA loss of $556,000 in the same year-ago quarter (see definition of this non-GAAP term and reconciliation to GAAP, below).
- Cash totaled $13.4 million at March 31, 2021, as compared to $9.2 million at December 31, 2020. The increase was primarily due to a private placement with net proceeds of $13.5 million completed in February 2021.
2021 Financial Outlook
For the full year 2021, the company is raising its revenue guidance to $90 million to $100 million from its previous guidance of $85 to $95 million. The current guidance represents revenue growth of 141% to 168% versus prior year.
Conference Call
LifeMD’s management will host a conference call followed by a question and answer session to discuss the company’s financial results and outlook.
Date: Thursday, May 13, 2021
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
Toll-free dial-in number: 1-866-269-4260
International dial-in number: 1-720-452-9102
Conference ID: 3530318
Webcast: http://public.viavid.com/index.php?id=144808
The conference call will be webcast live and available for replay via a link provided in the Investors section of the company’s website at https://ir.lifemd.com.
Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization.
Anyone listening to the call is encouraged to read the company's periodic reports on file with the Securities and Exchange Commission, including the discussion of risk factors and historical results of operations and financial condition in those reports.
About LifeMD
LifeMD, Inc. is a rapidly growing direct-to-patient telehealth company that offers cash pay virtual medical treatment, prescription medications and over the counter products to patients across all 50 states. LifeMD's telemedicine platform enables virtual access to affordable and convenient medical treatment from licensed providers and, when appropriate, prescription medications and over-the-counter products delivered directly to the patient's home. To learn more, go to LifeMD.com.
Cautionary Note 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. While 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 LifeMD, Inc. or a person acting on its behalf are expressly qualified in their entirety by this cautionary language.
| LIFEMD, INC. | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
| (Unaudited) | |||||||
| March 31, 2021 | December 31, 2020 | ||||||
| ASSETS | |||||||
| Current Assets | |||||||
| Cash | $ | 13,406,656 | $ | 9,179,075 | |||
| Accounts receivable, net | 1,351,443 | 648,421 | |||||
| Product deposit | 1,300,243 | 816,765 | |||||
| Inventory, net | 1,674,381 | 1,264,258 | |||||
| Other current assets | 104,801 | 154,876 | |||||
| Total Current Assets | 17,837,524 | $ | 12,063,395 | ||||
| Non-current assets | |||||||
| Right of use asset, net | 249,848 | 274,437 | |||||
| Capitalized software, net | 400,392 | 375,983 | |||||
| Intangible assets, net | 255,937 | 339,840 | |||||
| Total non-current assets | 906,177 | 990,260 | |||||
| Total Assets | $ | 18,743,701 | $ | 13,053,655 | |||
| LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' DEFICIT | |||||||
| Current Liabilities | |||||||
| Accounts payable and accrued expenses | $ | 13,430,136 | $ | 11,794,084 | |||
| Notes payable, net | 674,269 | 779,132 | |||||
| Deferred revenue | 1,339,309 | 916,880 | |||||
| Total Current Liabilities | 15,443,714 | 13,490,096 | |||||
| Long-term Liabilities | |||||||
| Lease Liability | 263,401 | 285,323 | |||||
| Contingent consideration on purchase of LegalSimpli | 100,000 | 100,000 | |||||
| Total Liabilities | 15,807,115 | 13,875,419 | |||||
| Mezzanine Equity | |||||||
| Preferred Stock, $0.0001 per value; 5,000,000 shares authorized | |||||||
| Series B Preferred Stock, $0.0001 per value; 5,000 shares authorized, 3,500 and 3,500 shares issued and outstanding, liquidation value approximately, $1,045 and $1,045 per share as of March 31, 2021 and December 31, 2020, respectively | 3,778,014 | 3,655,822 | |||||
| Stockholders’ Deficit | |||||||
| Common stock, $0.01 par value; 100,000,000 shares authorized, 25,885,014 and 23,433,663 shares issued, 25,781,974 and 23,330,623 outstanding as of March 31, 2021 and December 31, 2020, respectively | 258,851 | 234,337 | |||||
| Additional paid-in capital | 91,585,607 | 77,779,370 | |||||
| Accumulated deficit | (91,754,288 | ) | (80,151,905 | ) | |||
| 90,170 | (2,138,198 | ) | |||||
| Treasury stock, 103,040 and 103,040 shares, at cost | (163,701 | ) | (163,701 | ) | |||
| Total LifeMD, Inc. Stockholders’ Deficit | (73,531 | ) | (2,301,899 | ) | |||
| Non-controlling interest | (767,896 | ) | (2,175,687 | ) | |||
| Total Stockholders’ Deficit | (841,427 | ) | (4,477,586 | ) | |||
| Total Liabilities, Mezzanine Equity and Stockholders’ Deficit | $ | 18,743,701 | $ | 13,053,655 | |||
| LIFEMD, INC. | ||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Net Revenues | ||||||||
| Product revenues, net | $ | 13,283,315 | $ | 2,955,801 | ||||
| Software revenues, net | 4,914,797 | 1,349,011 | ||||||
| Service revenues, net | - | |||||||
| Total Revenues, net | 18,198,112 | 4,304,812 | ||||||
| Cost of product revenue | 3,123,025 | 1,252,747 | ||||||
| Cost of software revenue | 140,228 | 84,903 | ||||||
| Cost of revenues | 3,263,253 | 1,337,650 | ||||||
| Gross Profit | 14,934,859 | 2,967,162 | ||||||
| Expenses | ||||||||
| Selling & marketing expenses | 18,640,731 | 2,745,882 | ||||||
| General and administrative expenses | 6,863,879 | 1,590,967 | ||||||
| Other operating expenses | 861,081 | 124,491 | ||||||
| Customer service expenses | 295,277 | 168,185 | ||||||
| Development Costs | 192,228 | 78,142 | ||||||
| Total expenses | 26,853,196 | 4,707,667 | ||||||
| Operating Loss | (11,918,337 | ) | (1,740,505 | ) | ||||
| Other Income (Expenses) | ||||||||
| Interest expense, net | (139,463 | ) | (793,039 | ) | ||||
| Gain on debt forgiveness | 184,914 | - | ||||||
| 45,451 | (793,039 | ) | ||||||
| Net Loss before provision for income taxes | (11,872,886 | ) | (2,533,544 | ) | ||||
| Provision for income taxes | - | - | ||||||
| Net Loss | (11,872,886 | ) | (2,533,544 | ) | ||||
| Net (loss) attributable to noncontrolling interests | (270,503 | ) | (138,816 | ) | ||||
| Net loss attributable to LifeMD, Inc. common stockholders | $ | (11,602,383 | ) | $ | (2,394,728 | ) | ||
| Basic loss per share attributable to LifeMD, Inc. common stockholders | $ | (0.47 | ) | $ | (0.23 | ) | ||
| Diluted loss per share attributable to LifeMD, Inc. common stockholders | $ | (0.47 | ) | $ | (0.23 | ) | ||
| Weighted Average number of common shares outstanding: | ||||||||
| Basic | 24,467,788 | 10,697,767 | ||||||
| Diluted | 24,467,788 | 10,697,767 | ||||||
| LIFEMD, INC. | |||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
| (Unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| 2021 | 2020 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
| Net Loss | $ | (11,872,886 | ) | $ | (2,533,544 | ) | |
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||
| Amortization of debt discount | 80,051 | 191,247 | |||||
| Amortization of capitalized software | 24,451 | 2,551 | |||||
| Amortization of intangibles | 83,903 | 83,903 | |||||
| Acceleration of debt discount | - | 500,145 | |||||
| Gain on forgiveness of debt | (184,914 | ) | - | ||||
| Operating lease payments | 2,666 | 1,309 | |||||
| Stock compensation expense | 2,325,775 | 95,900 | |||||
| Liability to issue shares for services | - | 873,000 | |||||
| Changes in Assets and Liabilities | |||||||
| Accounts receivable | (703,022 | ) | (185,034 | ) | |||
| Product deposit | (483,478 | ) | 89,168 | ||||
| Inventory | (410,123 | ) | 395,774 | ||||
| Other current assets | 50,075 | 126,604 | |||||
| Deferred revenue | 422,429 | 193,408 | |||||
| Accounts payable and accrued expenses | 1,558,244 | 826,924 | |||||
| Net cash (used in) provided by operating activities | (9,106,829 | ) | 661,355 | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
| Cash paid for capitalized software costs | (48,860 | ) | (68,400 | ) | |||
| Payment to seller for contingent consideration | - | (400,000 | ) | ||||
| Net cash used in investing activities | (48,860 | ) | (468,400 | ) | |||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
| Cash proceeds from private placement offering, net | 13,495,270 | - | |||||
| Cash proceeds from exercise of options | 24,000 | - | |||||
| Purchase of membership interest of LSS | (100,000 | ) | - | ||||
| Distributions to non-controlling interest | (36,000 | ) | (36,000 | ) | |||
| Proceeds from note payable | 750,000 | ||||||
| Repayment of notes payable | (1,640,702 | ) | |||||
| Debt issuance costs | (15,000 | ) | |||||
| Net cash provided by (used in) financing activities | 13,383,270 | (941,702 | ) | ||||
| Net increase (decrease) in cash | 4,227,581 | (748,747 | ) | ||||
| Cash at beginning of period | 9,179,075 | 1,106,624 | |||||
| Cash at end of period | $ | 13,406,656 | $ | 357,877 | |||
| Cash paid for interest | |||||||
| Cash paid during the period for interest | $ | 17,271 | $ | 101,600 | |||
| Non-cash investing and financing activities: | |||||||
| Cashless exercise of warrants | $ | 300 | $ | 1,479 | |||
| Principal of Paycheck protection Program loans forgiven | $ | 184,914 | $ | - | |||
| Deemed dividend from warrant price adjustments | $ | - | $ | 1,142,385 | |||
| Stock yet to be issued for capitalized costs | $ | - | $ | 40,000 | |||
| Deemed distribution from down-round provision on unissued shares | $ | - | $ | 106,522 | |||
About the Use of Non-GAAP Financial Measures:
To supplement our financial information presented in accordance with GAAP, we use adjusted EBITDA and adjusted EPS, which are non-GAAP financial measures to clarify and enhance an understanding of past performance. We believe that the presentation of these financial measures enhances an investor’s understanding of our financial performance. We further believe that these financial measures are useful financial metrics to assess our operating performance from period-to-period by excluding certain items that we believe are not representative of our core business. We use certain financial measures for business planning purposes and in measuring our performance relative to that of our competitors.
Adjusted EBITDA is defined as income (loss) attributable to common shareholders before interest, taxes, depreciation, amortization, financing expense, acceleration of debt discount, inventory valuation adjustment/write off, warrant settlements, accrued interest/deemed distributions, and stock-based compensation expense.
Adjusted EPS is defined as the diluted net loss attributable to LifeMD, Inc common shareholders before stock-based compensation expense.
We believe the above financial measures are commonly used by investors to evaluate our performance and that of our competitors. However, our use of the terms adjusted EBITDA and adjusted EPS may vary from that of others in our industry. None of adjusted EBITDA or adjusted EPS should be considered as an alternative to net loss before taxes, net loss, loss per share or any other performance measures derived in accordance with GAAP as measures of performance.
The following is a reconciliation of Net loss attributable to common shareholders, the most directly comparable GAAP financial measure, to adjusted EBITDA:
| Reconciliation of GAAP Net Loss to Adjusted EBITDA | ||||||||
| (in whole numbers, unaudited) | ||||||||
| Three months ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Net (loss) attributable to common shareholders | $ | (11,602,383 | ) | $ | (2,394,728 | ) | ||
| Interest expense (excluding debt discount and acceleration of debt) | 17,271 | 101,647 | ||||||
| Depreciation & Amortization Expense | 152,743 | 86,545 | ||||||
| Amortization of debt discount | - | 191,247 | ||||||
| Financing transactions expense | 125,979 | 62,012 | ||||||
| Acceleration of debt discount | - | 500,145 | ||||||
| Inventory valuation adjustment | - | 769,378 | ||||||
| Accrued interest on Series B Stock | 122,192 | - | ||||||
| Stock-based compensation expense | 2,325,775 | 127,900 | ||||||
| Adjusted EBITDA | $ | (8,858,424 | ) | $ | (555,854 | ) | ||
The following is a reconciliation of GAAP diluted loss per share attributable to common shareholders, the most directly comparable GAAP financial measure, to adjusted EPS:
| Reconciliation of GAAP Diluted Loss per Share Attributable to Common Shareholders to Adjusted EPS | ||||||||
| Three months ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Diluted loss per share attributable to LifeMD, Inc. common shareholders | $ | (0.47 | ) | $ | (0.23 | ) | ||
| Adjustments to Reconcile GAAP Diluted Loss Per Share to Adjusted EPS | ||||||||
| Stockholders Compensation Expense | $ | 0.10 | $ | 0.01 | ||||
| Adjusted EPS | $ | (0.38 | ) | $ | (0.22 | ) | ||
Company Contact
LifeMD, Inc.
Marc Benathen, CFO
Email Contact
Investor Relations Contact
Ashley Robinson
LifeSci Advisors, LLC
arr@lifesciadvisors.com