MARPAI REPORTS THIRD QUARTER 2024 FINANCIAL RESULTS
Turnaround continues to gain traction
TAMPA, Fla., Nov. 11, 2024 /PRNewswire/ -- Marpai, Inc. ("Marpai" or the "Company") (OTCQX: MRAI), a technology platform company, which operates as a national Third-Party Administrator (TPA) through its subsidiaries and is transforming the $22 billion TPA market by offering affordable, intelligent, healthcare solutions to self-funded employer health plans, announced financial results for the third quarter of 2024. The Company expects to hold a webcast to discuss the results on November 12, 2024.
Q3 2024 Financial Highlights:
-- Net revenues were approximately $7.0 million for the three months ended
September 30, 2024, down $1.7 million, or 20% lower year over year,
compared to the three months ended September 30, 2023.
-- Operating expenses were $10.1 million for the three months ended
September 30, 2024, down $5.7 million, or 36% lower year over year
compared to the three months ended September 30, 2023.
-- Operating loss was $3.1 million for the three months ended September 30,
2024, lower by $4.0 million, or 57% lower year over year compared to the
three months ended September 30, 2023.
-- Net loss was $3.6 million for the three months ended September 30, 2024,
lower by $3.7 million, or 51% lower year over year compared to the three
months ended September 30, 2023.
-- Basic and diluted earnings per share were ($0.30) for the three months
ended September 30, 2024, up $0.68 per share year over year compared to
the three months ended September 30, 2023.
"As you can see from our highlights, we continue to make strong progress with our turnaround efforts. Our goal remains profitability and positive cash flow," said Damien Lamendola, Chief Executive Officer of Marpai. "We have some exciting developments that we will be announcing in the fourth quarter."
Webcast and Conference Call Information
Marpai expects to host a conference call and webcast on Tuesday, November 12, 2024, at 8:30 a.m. ET to review the Company's operational and financial highlights for its third quarter ended September 30, 2024.
Investors interested in listening to the conference call may do so by dialing (800)-836-8184 for domestic callers or +1-646-357-8785 for international callers, or via webcast: https://app.webinar.net/Jd298rR8DBe
About Marpai, Inc.
Marpai, Inc. (OTCQX: MRAI) is a technology platform company which operates subsidiaries that provide TPA and value-oriented health plan services to employers that directly pay for employee health benefits. Primarily competing in the $22 billion TPA sector serving self-funded employer health plans representing over $1 trillion in annual claims. Through its Marpai Saves initiative, the Company works to deliver the healthiest member population for the health plan budget. Operating nationwide, Marpai offers access to leading provider networks including Aetna and Cigna and all TPA services. For more information, visit www.marpaihealth.com, the content of which is not incorporated by reference into this press release. Investors are invited to visit https://www.ir.marpaihealth.com.
Forward-Looking Statement Disclaimer
This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties. Forward-looking statements can be identified through the use of words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," "guidance," "may," "can," "could", "will", "potential", "should," "goal" and variations of these words or similar expressions. For example, the Company is using forward-looking statements when it discusses that it continues to make strong progress with its turnaround efforts, that its goal remains profitability and positive cash flow and that it expects to have some exciting developments that it will be announcing in the fourth quarter. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Marpai's current expectations and speak only as of the date of this release. Actual results may differ materially from Marpai's current expectations depending upon a number of factors. These factors include, among others, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business. Except as required by law, Marpai does not undertake any responsibility to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.
More detailed information about Marpai and the risk factors that may affect the realization of forward-looking statements is set forth in Marpai's filings with the Securities and Exchange Commission. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov.
MARPAI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands, except share and per share data)
(Unaudited)
September 30, 2024 December 31, 2023
ASSETS:
Current assets:
Cash and cash equivalents $830 $1,147
Restricted cash 10,978 12,345
Accounts receivable, net of allowance for credit losses of $0 and $25 1,228 1,124
Unbilled receivable 579 768
Due from buyer for sale of business unit 500 800
Prepaid expenses and other current assets 771 901
Total current assets 14,886 17,085
Property and equipment, net 514 611
Capitalized software, net 752 2,127
Operating lease right-of-use assets 2,192 2,373
Goodwill 3,018
Intangible assets, net 5,177
Security deposits 1,248 1,267
Other long-term asset 15 22
Total assets $19,607 $31,680
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities:
Accounts payable $3,764 $4,649
Accrued expenses 2,957 2,816
Accrued fiduciary obligations 7,969 11,573
Deferred revenue 1,390 661
Current portion of operating lease liabilities 559 512
Current portion of convertible debenture, net 1,540
Other short-term liabilities 632
Total current liabilities 18,179 20,843
Other long-term liabilities 20,467 19,401
Convertible debenture, net of current portion 4,072
Operating lease liabilities, net of current portion 3,257 3,684
Deferred tax liabilities 1,190 1,190
Total liabilities 47,165 45,118
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' (DEFICIT) EQUITY
Common stock, $0.0001 par value, 227,791,050 shares authorized; 13,747,982 shares and 7,960,938 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively 1 1
Additional paid-in capital 70,119 63,307
Accumulated deficit (97,678) (76,746)
Total stockholders' (deficit) equity (27,558) (13,438)
Total liabilities and stockholders' (deficit) equity $19,607 $31,680
MARPAI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(Unaudited)
Three Months Ended
September 30, 2024 September 30, 2023
Revenue $7,008 $8,729
Costs and expenses
Cost of revenue (exclusive of depreciation and amortization 5,033 5,691
shown separately below)
General and administrative 2,813 4,986
Sales and marketing 345 1,842
Information technology 1,273 1,269
Research and development 7 267
Depreciation and amortization 213 927
Loss on disposal of assets 7
Loss on sale of business unit 73
Facilities 311 769
Total costs and expenses 10,068 15,758
Operating loss (3,060) (7,029)
Other income (expenses)
Other income 119 130
Interest expense, net (620) (383)
Foreign exchange (loss) gain 1 (14)
Loss before provision for income taxes (3,560) (7,296)
Income tax expense
Net loss $(3,560) $(7,296)
Net loss per share, basic & fully diluted $(0.30) $(0.98)
Weighted average common shares outstanding, basic and 12,043,931 7,479,401
diluted
MARPAI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(Unaudited)
Nine Months Ended
September 30, 2024 September 30, 2023
Revenue $21,582 $28,448
Costs and expenses
Cost of revenue (exclusive of depreciation and amortization 15,078 18,530
shown separately below)
General and administrative 9,954 15,938
Sales and marketing 1,383 5,494
Information technology 3,608 4,775
Research and development 22 1,291
Depreciation and amortization 2,078 2,974
Impairment of goodwill and intangible assets 7,588
Loss on disposal of assets 350
Loss on sale of business unit 73
Facilities 1,197 1,918
Total costs and expenses 40,981 51,270
Operating loss (19,399) (22,822)
Other income (expenses)
Other income 360 231
Interest expense, net (1,890) (1,102)
Foreign exchange (loss) gain (3) (32)
Loss before provision for income taxes (20,932) (23,725)
Income tax expense
Net loss $(20,932) $(23,725)
Net loss per share, basic & fully diluted $(1.96) $(3.62)
Weighted average common shares outstanding, basic and 10,697,008 6,552,575
diluted
MARPAI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, except share and per share data)
(Unaudited)
Nine Months Ended
September 30, 2024 30-Sep-23
Cash flows from operating activities:
Net loss $(20,932) $(23,725)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 2,078 2,974
Loss on disposal of assets 350
Loss on sale of receivables 306
Share-based compensation 2,786 1,837
Loss on sale of business unit 73
Common Stock issued to vendors in exchange for services 79
Amortization of right-of-use asset 181 1,289
Gain on termination of lease 33
Impairment of goodwill and intangible assets 7,588
Non-cash interest 975 1,204
Amortization of debt discount and debt issuance costs 128
Changes in operating assets and liabilities:
Accounts receivable and unbilled receivable 85 639
Prepaid expense and other assets 136 216
Due from buyer for sale of business unit 227
Security deposit 19 (16)
Accounts payable (885) 336
Accrued expenses 141 (693)
Accrued fiduciary obligations (3,604) 853
Operating lease liabilities (380) (1,670)
Due To related party (3)
Other liabilities 827 973
Net cash used in operating activities (10,251) (15,324)
Cash flows from investing activities:
Disposal of property and equipment 27
Net cash provided by (used in) investing activities 27
Cash flows from financing activities:
Proceeds from issuance of common stock in a public offering, net 6,432
Proceeds from sale of future cash receipts on accounts receivable 1,509
Proceeds from issuance of convertible debentures 5,978
Payments of convertible debenture issuance costs (499)
Payments to buyer of receivables (1,816)
Payments to seller for acquisition (631)
Proceeds from issuance of common stock in a private offering, net 4,026
Net cash provided by financing activities 8,567 6,432
Net decrease in cash, cash equivalents and restricted cash (1,684) (8,865)
Cash, cash equivalents and restricted cash at beginning of period 13,492 23,117
Cash, cash equivalents and restricted cash at end of period $11,808 $14,252
Reconciliation of cash, cash equivalents, and restricted cash reported in
the condensed consolidated balance sheet
Cash and cash equivalents $830 $3,018
Restricted cash 10,978 11,234
Total cash, cash equivalents and restricted cash shown in the condensed $11,808 $14,252
consolidated statement of cash flows
Supplemental disclosure of cash flow information
Cash paid for interest $1,508
$ -
Supplemental disclosure of non-cash activity
Measurement period adjustment to Goodwill
$ - $198
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SOURCE Marpai
