- Identification and elimination of $7.5 million of annualized run-rate costs, focusing on future growth and sustainable profitability
- Cost optimization activities will simplify operations, improve execution, strengthen customer focus, support cross-selling, and enable CloudMD to continue investing in innovation to drive industry leading health navigation solutions for individuals and organizations
- Strategy will continue to focus on refinement of the business to have the most efficient and effective operating model
VANCOUVER, British Columbia, March 31, 2022 (GLOBE NEWSWIRE) -- CloudMD Software & Services Inc. (TSXV: DOC, OTCQX: DOCRF, Frankfurt: 6PH) (“CloudMD” or the “Company”), a healthcare technology and innovative health services company transforming the delivery of care, is pleased to provide an update on its cost optimization process, integration of its comprehensive health services platform and organizational structure.
CloudMD’s cost optimization team is dedicated to creating shareholder and client value through the integration of people, process, and technology across the entire organization. Since the start of the year, approximately $7.5 million of annualized run-rate costs have been eliminated from the organization through integration, cost-synergies and streamlining operational functions across the entire business. The full benefit of these cost savings is expected to be realized in the second quarter. This exceeds the expected $4 million in cost savings the Company previously disclosed.
“We are pleased with our ability to accelerate the identification and elimination of $7.5 million of run-rate costs which we have already been taken out of the business since the beginning of the year. In addition, we have used this opportunity to re-evaluate the organizational structure and streamline our business operations to prioritize exemplary service for our customers. This will result in our customers realizing increased return on investment and return on employee satisfaction,” commented John Plunkett, EVP, Transformation and Strategic Planning at CloudMD.
CloudMD has demonstrated its ability to execute on its cost optimization strategy to drive sustainable profitability by:
- Integrating MindBeacon’s iCBT solution into CloudMD’s Mental Health Support Solutions, providing user engagement through assessment and treatment options for mild, moderate and chronic conditions.
- Streamlining and consolidating key operational functions across Finance, IT, Human Resources, Marketing and Sales and leveraging industry leading talent to drive innovation, retention and capitalize on human capital.
- Strengthening Digital Health Solutions by creating a new product management team focused on innovation and continuing to meet the health needs of individuals.
The Company believes there are additional efficiencies to be realized as it continues its integration efforts this year. In addition, CloudMD is also focused on cross-sell revenue synergies through its complete and connected health ecosystem, which will support continued strong top-line growth.
As part of the cost optimization, CloudMD has made some changes to its organizational structure to streamline the operations and create a more efficient business. Several positions have been reorganized and / or consolidated to leverage important capabilities, share best practices and drive growth throughout the organization. As part of the reorganization, effective March 31, 2022, Kanchan Thindal has stepped down as the Company’s Chief Operating Officer (COO). Karen Adams, President, will assume the roles and responsibilities of COO for the Company. CloudMD would like to thank Kanchan for her dedication and support over the last four years through the Company’s significant growth.
Through the organizational restructure, CloudMD has made several changes to consolidate and strengthen the depth of its leadership team including appointing Lu Barbuto, EVP Enterprise Health Solutions; Adam Kelly, Chief Commercial Officer; Aida Begovic, EVP Digital Health Solutions; John Plunkett, EVP Transformation and Strategic Planning; Jon Harju, SVP, Engineering; Bronwyn Ott, SVP, Human Resources and Olga McRae, Corporate Secretary. CloudMD has also introduced a process to continually review and evaluate its operational integration and additional changes may be implemented as indicated by such process.
No changes have been made to CloudMD’s current business units, Clinics & Pharmacies, Digital Health Solutions and Enterprise Health Solutions.
“Execution of our strategy is dependent on diligent cost management throughout the year. We are focusing on higher productivity and sustainable cost effectiveness to position us for increased profit and scalability,” stated Karen Adams, President of CloudMD. “The focus is on delivering the product vision, while ensuring we have the operating model and capabilities to deliver profitable growth. The actions we are announcing today, and the processes we have introduced, will better align our organization and cost structure to achieve these objectives. We will continue driving revenue and margin expansion by adding capabilities to our patented integrated healthcare platform, cross selling our capabilities portfolio, and bringing new, innovative healthcare solutions to the market.”
About CloudMD Software & Services
CloudMD is transforming the delivery of healthcare using technology and by providing a patient-centric approach, with an emphasis on continuity of care. By leveraging healthcare technology, the Company is building one, connected platform that addresses all points of a patient’s healthcare journey and provides better access to care and improved outcomes. Through CloudMD’s proprietary technology, the Company delivers quality healthcare through a holistic offering including hybrid primary care clinics, specialist care, telemedicine, mental health support, healthcare navigation, educational resources, and artificial intelligence (AI). CloudMD’s business is separated into three main divisions: Clinics and Pharmacies, Digital Solution and Enterprise Health Solutions, the Company’s fastest growing division. CloudMD’s Enterprise Health Solutions Division has built a leading employer healthcare solutions, including its Comprehensive Integrated Health Services Platform, which offers one comprehensive, digitally connected platform for educational institutions, corporations, insurers, and advisors to better manage the health and wellness of their students, employees, and customers.
CloudMD currently services a combined ecosystem of over 7,000 psychiatrists, approximately 4,500 therapists and counsellors, approximately 4,000 psychologists, over 22,000 family physicians, over 34,000 medical specialists, over 1,500 allied health professionals, over 500 clinics, and over 5 million individuals across North America. For more information visit: https://investors.cloudmd.ca.
ON BEHALF OF THE BOARD OF DIRECTORS
“Dr. Essam Hamza, MD"
Chief Executive Officer
FOR ADDITIONAL INFORMATION CONTACT:
Julia Becker
VP, Investor Relations
julia@cloudmd.ca
(604)785-0850
FORWARD-LOOKING STATEMENTS
This news release contains “forward-looking statements” and “forward-looking information” within the meaning of Canadian securities laws. Forward-looking statements in this news release include, but are not limited to: when the benefit of the cost savings will be realized and the impact of such savings; the timing and impact of integration, including on top-line growth; and future changes that may be implemented as a result of the review and evaluation process. These statements are based upon information currently available to CloudMD’s management. All information that is not clearly historical in nature may constitute forward‐looking statements. In some cases, forward‐looking statements may be identified by the use of terms such as “forecast”, “assumption” and other similar expressions or future or conditional terms such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, “will”, “would”, and “should”. Forward-looking statements contained in this news release are based on certain factors and assumptions made by management of CloudMD based on their current expectations, estimates, projections, assumptions and beliefs regarding their business and CloudMD does not provide any assurance that actual results will meet management’s expectations. While management considers these assumptions to be reasonable based on information currently available to them, they may prove to be incorrect. Such forward‐looking statements are not guarantees of future events or performance and by their nature involve known and unknown risks, uncertainties and other factors, including those risks described in the Company’s MD&A and most recent Annual Information Form (which are filed under the Company’s issuer profile on SEDAR and can be accessed at www.sedar.com), that may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward‐looking statements. Although CloudMD has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward‐looking statements, other factors may cause actions, events or results to be different than anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such forward‐looking statements. Accordingly, readers should not place undue reliance on forward‐looking information. CloudMD does not undertake to update any forward-looking information, whether as a result of new information or future events or otherwise, except as may be required by applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
