GREENBROOK TMS REPORTS SECOND QUARTER OPERATIONAL AND FINANCIAL RESULTS
SECOND QUARTER 2023 OPERATIONAL AND FINANCIAL HIGHLIGHTS
- Quarterly revenue increased by
29% to$18.3 million $4.1 million 40% to$38.3 million $11.0 million - Quarterly revenue proved resilient at approximately
87% of the total quarterly revenue achieved in the fourth quarter of 2022 ("Q4 2022"), despite the closure of 50 treatment centers in connection with the Company's previously-announced comprehensive restructuring plan (the "Restructuring Plan") and a significantly reduced marketing spend (marketing spend in Q2 2023 represented less than10% of marketing spend in Q4 2022). - As a result of the Restructuring Plan, the Company eliminated approximately
$21 million $22 million $25 million - Loss for the period and comprehensive loss increased by
68% in Q2 2023 to$12.3 million $5.0 million 41% to$21.6 million $6.2 million - The Company continued its roll-out of its Spravato® (esketamine nasal spray) offering at select treatment centers to diversify its offering to patients. As of the date of this press release, the Company has expanded its Spravato® offering to 50 treatment centers. We expect to have 70-80 treatment centers offering Spravato® through an accelerated roll-out by the end of Fiscal 2023.
- The Company began a pilot to roll-out the facilitation of medication management at selection treatment centers. We believe this program will allow us to reach patients earlier in their treatment journey, develop an internal patient pipeline for TMS and Spravato®, while also further optimizing marketing costs.
- With the recent financing transactions entered into subsequent to Q2 2023, the Company has enhanced its liquidity position and secured access to further capital to continue to execute on its Restructuring Plan and with the objective of achieving profitability.
Bill Leonard, President and Chief Executive Officer of Greenbrook, commented:
"The execution of our Restructuring Plan continues to yield positive results including entity-wide regional operating income and we believe that we are well-positioned to continue to reduce the business cost structure sufficiently to operate profitably. Quarterly revenue in Q2 2023 was impacted by liquidity constraints prohibiting any meaningful investment in marketing to effectively generate an adequate patient pipeline. We are, however, encouraged by our current base level of post-Restructuring Plan quarterly revenue, which we intend to build on through marketing investment, acceleration of the Spravato® Program and roll-out of medication management as we have now strengthened our balance sheet through recent financing transactions including with our supportive insiders and lender. As we continue to implement the Restructuring Plan, we believe that mental health remains a key focus in
SELECTED SECOND QUARTER FINANCIAL AND OPERATING RESULTS (1)
Selected Financial Results
(US$) (unaudited) | Q2 2023 | Q2 2022 | YTD 2023 | YTD 2022 | |||
Total revenue | 18,346,799 | 14,210,309 | 38,254,850 | 27,275,455 | |||
Regional operating income (loss) | 237,003 | (71,075) | 966,053 | (1,109,124) | |||
Loss before income taxes | (12,320,416) | (7,352,528) | (21,604,979) | (15,357,487) | |||
Loss for the year and comprehensive loss | (12,320,416) | (7,352,528) | (21,604,979) | (15,357,487) | |||
Loss attributable to the common | (12,259,994) | (7,347,849) | (21,491,876) | (15,185,832) | |||
Net loss per share (basic and diluted) | (0.30) | (0.41) | (0.60) | (0.85) |
_________ | |
Note: | |
(1) | Please note that additional selected consolidated financial information can be found at the end of this press release. |
Selected Operating Results
As at June 30, | As at December 31, | ||||
(unaudited) | 2023 | 2022 | 2022 | ||
Number of active Treatment Centers(1) | 133 | 144 | 183 | ||
Number of Treatment Centers-in-development(2) | – | – | – | ||
Total Treatment Centers | 133 | 144 | 183 | ||
Number of management regions | 17 | 13 | 18 | ||
Number of TMS Devices installed | 341 | 234 | 345 | ||
Number of regional personnel | 400 | 328 | 495 | ||
Number of shared-services / corporate | 84 | 66 | 134 | ||
Number of providers(4) | 202 | 164 | 225 | ||
Number of consultations performed(5) | 17,899 | 7,818 | 27,831 | ||
Number of patient starts(5) | 5,501 | 3,626 | 9,253 | ||
Number of Treatments performed(5) | 174,388 | 121,105 | 312,940 | ||
Average revenue per Treatment(5) | |||||
______ | |
Notes: | |
(1) | Active Treatment Centers represent Treatment Centers that have performed billable Treatment services during the applicable period. |
(2) | Treatment Centers-in-development represents Treatment Centers that have committed to a space lease agreement and the development process is substantially complete. |
(3) | Shared-services / corporate personnel is disclosed on a full-time equivalent basis. The Company utilizes part-time staff and consultants as a means of managing costs. |
(4) | Number of providers represents clinician partners that are involved in the provision of Treatment services from our Treatment Centers. |
(5) | Figure calculated for the applicable year or period ended. |
For more information, please refer to the Management's Discussion & Analysis of Financial Condition and Results of Operations (the "Q2 2023 MD&A") and the unaudited condensed interim consolidated financial statements of the Company for the three and six months ended June 30, 2023 and 2022. These documents will be available on the Company's website at www.greenbrooktms.com, under the Company's SEDAR+ profile at www.sedarplus.ca and under the Company's EDGAR profile at www.sec.gov.
CONFERENCE CALL AND WEBCAST
Second Quarter Conference Call Details:
Bill Leonard, President and Chief Executive Officer, and Erns Loubser, Chief Financial Officer, will host a conference call at 10:00 a.m. (Eastern Time) on August 15, 2023 to discuss the financial results for Q2 2023.
Toll Free North America: 1-888-396-8049
Webcast:
For more information or to listen to the call via webcast, please visit:
www.greenbrooktms.com/investors/events.htm
For those that plan on accessing the conference call or webcast, please allow ample time prior to the call time.
Conference Call Replay:
Following the live call, a replay will be available on the Investor Relations section of the Company's website and www.greenbrooktms.com/investors/events.htm
About Greenbrook TMS Inc.
Operating through 133 Company-operated Treatment Centers (following completion of the Restructuring Plan), Greenbrook is a leading provider of Transcranial Magnetic Stimulation ("TMS") and Spravato® (esketamine nasal spray), FDA-cleared, non-invasive therapies for the treatment of Major Depressive Disorder ("MDD") and other mental health disorders, in
Cautionary Note Regarding Forward-Looking Information
Certain information in this press release, including, but not limited to, information with respect to the Company's future financial or operating performance, the Company's expectations regarding the impact of the Restructuring Plan on our business, and the continued roll-out of the Spravato® and medication management offering at additional treatment centers and its potential to enhance profit margins and diversify total revenue, constitute forward-looking information within the meaning of applicable securities laws in
Forward-looking information is necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by the Company as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation: macroeconomic factors such as inflation and recessionary conditions, substantial doubt regarding the Company's ability to continue as a going concern due to recurring losses from operations; inability to increase cash flow and/or raise sufficient capital to support the Company's operating activities and fund its cash obligations, repay indebtedness and satisfy the Company's working capital needs and debt obligations; prolonged decline in the price of the Common Shares reducing the Company's ability to raise capital; inability to satisfy debt covenants under the Company's credit facility and the potential acceleration of indebtedness; including as a result of an unfavorable decision in respect of the litigation with Benjamin Klein; risks related to the ability to continue to negotiate amendments to the Company's credit facility to prevent a default; risks relating to the Company's ability to deliver and execute on the Restructuring Plan and the possible failure to complete the Restructuring Plan on terms acceptable to the Company or its suppliers (including Neuronetics Inc.), or at all; risks relating to maintaining an active, liquid and orderly trading market for Common Shares as a result of the Company's potential inability to regain compliance with the Nasdaq Stock Market's listing rules; risks relating to the Company's ability to realize expected cost-savings and other anticipated benefits from the Restructuring Plan; risks related to the Company's negative cash flows, liquidity and its ability to secure additional financing; increases in indebtedness levels causing a reduction in financial flexibility; inability to achieve or sustain profitability in the future; inability to secure additional financing to fund losses from operations and satisfy the Company's debt obligations; risks relating to strategic alternatives, including restructuring or refinancing of the Company's debt, seeking additional debt or equity capital, reducing or delaying the Company's business activities and strategic initiatives, or selling assets, other strategic transactions and/or other measures, including obtaining bankruptcy protection, and the terms, value and timing of any transaction resulting from that process; claims made by or against the Company, which may be resolved unfavorably to us; risks relating to the Company's dependence on Neuronetics Inc. as its exclusive supplier of TMS devices. Additional risks and uncertainties are discussed in the Company's materials filed with the Canadian securities regulatory authorities and the United States Securities and Exchange Commission from time to time, available at www.sedarplus.ca and www.sec.gov, respectively. These factors are not intended to represent a complete list of the factors that could affect the Company; however, these factors should be considered carefully. There can be no assurance that such estimates and assumptions will prove to be correct. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company expressly disclaims any obligation to update or alter statements containing any forward-looking information, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.
Selected Consolidated Financial Information
(US$) (unaudited) | Q2 2023 | Q2 2022 | YTD 2023 | YTD 2022 | |||
Total revenue | 18,346,799 | 14,210,309 | 38,254,850 | 27,275,455 | |||
Direct center and patient care costs | 11,281,818 | 7,645,662 | 22,945,186 | 14,986,158 | |||
Regional employee compensation | 4,107,321 | 3,361,426 | 8,772,966 | 6,836,977 | |||
Regional marketing expenses | 403,548 | 1,687,736 | 816,601 | 3,404,900 | |||
Depreciation | 2,317,109 | 1,586,560 | 4,754,044 | 3,156,544 | |||
Total direct center and regional | 18,109,796 | 14,281,384 | 37,288,797 | 28,384,579 | |||
Regional operating income (loss) | 237,003 | (71,075) | 966,053 | (1,109,124) | |||
Center development costs | 105,871 | 186,708 | 218,062 | 346,154 | |||
Corporate employee compensation | 4,109,639 | 3,437,683 | 8,250,728 | 7,055,544 | |||
Corporate marketing expenses | 25,945 | 89,617 | 31,267 | 224,570 | |||
Other corporate, general and | 3,648,051 | 2,085,317 | 5,357,196 | 3,456,121 | |||
Share-based compensation | 513,782 | 63,882 | 576,730 | 313,204 | |||
Amortization | 343,252 | 207,500 | 686,505 | 415,000 | |||
Interest expense | 3,810,935 | 1,220,689 | 7,450,645 | 2,450,000 | |||
Interest income | (56) | (9,943) | (101) | (12,230) | |||
Loss before income taxes | (12,320,416) | (7,352,528) | (21,604,979) | (15,357,487) | |||
Income tax expense | – | – | – | – | |||
Loss for the period and | (12,320,416) | (7,352,528) | (21,604,979) | (15,357,487) | |||
Loss attributable to non-controlling | (60,422) | (4,679) | (113,103) | (171,655) | |||
Loss attributable to the common | (12,259,994) | (7,347,849) | (21,491,876) | (15,185,832) | |||
Net loss per share (basic and | (0.30) | (0.41) | (0.60) | (0.85) |
Q2 2023 | Q1 2023 | Q4 2022 | Q3 2022 | Q2 2022 | Q1 2022 | Q4 2021 | Q3 2021 | ||||||||
(unaudited) | |||||||||||||||
Revenue | 18,346,799 | 19,908,051 | 21,076,886 | 20,752,105 | 14,210,309 | 13,065,146 | 14,047,452 | 13,130,245 | |||||||
Regional operating income | 237,003 | 729,050 | (141,846) | (849,472) | (71,075) | (1,038,049) | 43,741 | 249,057 | |||||||
Net loss attributable to | (12,259,994) | (9,231,882) | (30,179,216) | (16,361,426) | (7,347,849) | (7,837,983) | (6,831,859) | (3,517,250) | |||||||
Net loss per share – Basic | (0.30) | (0.30) | (1.22) | (0.59) | (0.41) | (0.44) | (0.34) | (0.22) | |||||||
Net loss per share – Diluted | (0.30) | (0.30) | (1.22) | (0.59) | (0.41) | (0.44) | (0.34) | (0.22) |
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SOURCE Greenbrook TMS Inc.
