Forian Inc. (Nasdaq: FORA),
a provider of data science driven information and analytics
solutions to the healthcare and life sciences industries, today
announced results for the quarter ended June 30, 2024.
“We continued to invest in our information assets in the second
quarter to further differentiate our offerings and the insights
they power for our customers. We remain confident that our
combination of thoughtful productization, diversification of data
sources and prudent cost containment put us in solid position to
manage through recent industry challenges and to continue our
contribution to our customers’ success,” stated Max Wygod, Chairman
and Chief Executive Officer of Forian.
Second Quarter 2024 Financial Results
- Forian delivered the following results for the second quarter
of 2024:
|
|
|
Three Months EndedJune 30, |
|
Period-over-Period %
Change |
|
|
|
|
|
|
|
2024Unaudited |
|
2023Unaudited |
|
Revenue |
|
$ |
4,777,101 |
|
|
$ |
4,893,542 |
|
|
-2 |
% |
|
|
|
|
|
|
|
|
Loss from
continuing operations, net of tax |
|
$ |
(2,553,259 |
) |
|
$ |
(1,090,400 |
) |
|
-134 |
% |
(Loss) income from
discontinued operations, net of tax |
|
$ |
- |
|
|
$ |
(32,426 |
) |
|
-100 |
% |
Net (loss)
income |
|
$ |
(2,553,259 |
) |
|
$ |
(1,122,826 |
) |
|
-127 |
% |
|
|
|
|
|
|
|
|
Loss from
continuing operations, net of tax per share – basic and
diluted |
$ |
(0.08 |
) |
|
$ |
(0.03 |
) |
|
-167 |
% |
Income from
discontinued operations, net of tax per share – basic and
diluted |
$ |
- |
|
|
$ |
- |
|
|
0 |
% |
(Loss) Income per
share – basic and diluted |
|
$ |
(0.08 |
) |
|
$ |
(0.03 |
) |
|
-167 |
% |
|
|
|
|
|
|
|
|
Adjusted EBITDA (a
non-GAAP financial measure defined below) |
|
$ |
78,202 |
|
|
$ |
417,368 |
|
|
-81 |
% |
- Revenue for the quarter was $4.8 million, a $0.1 million
decrease from $4.9 million in the prior year
- Net loss from continuing operations for the quarter was $2.6
million, or $0.08 per share, compared to a net loss of $1.1
million, or $0.03 per share, in the prior year
- Adjusted EBITDA for the quarter was $0.08 million, compared to
$0.4 million in the prior year
- Cash, cash equivalents and marketable securities at June 30,
2024 totaled $48.0 million
Highlights
- Continued expansion of Chronos™ data lake through license of
additional data to offset the reduction and expected 2025 loss of
certain data from one data supplier
- Maintained positive Adjusted EBITDA despite revenue impact
resulting from financing challenges of two early-stage
customers
Full Year 2024 Outlook
Based on information as of August 14, 2024, the Company is
updating its outlook for the year ending December 31, 2024 as
follows:
- Revenue is expected to be in the range of $19 to $20
million
- Adjusted EBITDA is expected to be in the range of negative $0.5
million to $0.5 million
This release uses non-GAAP financial measures
that are adjusted for the impact of various U.S. GAAP items. See
the section titled “Non-GAAP Financial Measures”
and the table entitled “Reconciliation of U.S. GAAP to
Non-GAAP Financial Measures” below for details.
Quarterly Conference Call and Webcast
Forian will host a conference call and webcast at 4:30 p.m. ET
on August 14, 2024 to discuss its financial results with the
investment community. To register for the conference call, click
here. The webcast will be available live at
https://edge.media-server.com/mmc/p/c5ot6k5y. This information is
also available on our website at www.forian.com/investors. To
be included on the Company’s email distribution list, please sign
up at www.forian.com/investors.
About ForianForian provides a unique suite of
data management capabilities and proprietary information and
analytics solutions to optimize and measure operational, clinical
and financial performance for customers within the traditional and
emerging life sciences and healthcare payer and provider segments.
Forian has industry leading expertise in acquiring, integrating,
normalizing and commercializing large scale healthcare data assets.
Forian’s information products overlay sophisticated data management
and data science capabilities on top of a comprehensive clinical
data lake to identify unique relationships, create distinctive
information assets and generate proprietary insights. For more
information, please visit the Company’s website
at www.forian.com.
Cautionary Statements Regarding Forward-Looking
StatementsThis release contains “forward-looking
statements” within the meaning of the federal securities laws,
including Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
In this context, forward-looking statements often address expected
future business and financial performance and financial condition,
which may include GAAP and non-GAAP financial measures, and often
contain words such as “expect,” “anticipate,” “intend,” “plan,”
“believe,” “seek,” “see,” “will,” “would,” “target,” similar
expressions and variations or negatives of these words.
Forward-looking statements by their nature address matters that
involve risks and uncertainties, many of which are beyond our
control and are not guarantees of future results, such as
statements about future financial and operating results, company
strategy and intended product offerings and market positioning.
These and other forward-looking statements are not guarantees of
future results and are subject to risks, uncertainties and
assumptions that could cause actual results to differ materially
from those expressed in any forward-looking statements.
Accordingly, there are or will be important factors that could
cause actual results to differ materially from those indicated in
such statements and, therefore, you should not place undue reliance
on any such statements and caution must be exercised in relying on
forward-looking statements. Our updated 2024 outlook contained in
this release is based on current estimates as of today’s date that
are subject to such factors. Factors that could cause actual
results to differ include, but are not limited to, those risks and
uncertainties associated with operations, strategy and goals, our
ability to execute on our strategy and the additional risks and
uncertainties set forth more fully under the caption “Risk Factors”
in Forian’s Annual Report on Form 10-K for the year ended December
31, 2023, as filed with the SEC on March 29, 2024, and elsewhere in
Forian’s filings and reports with the SEC. Forward-looking
statements contained in this release are made as of the date
hereof, and we undertake no duty to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required under
applicable law.
Media and Investor
Contact:forian.com/investorsir@forian.com267-225-6263SOURCE: Forian
Inc.
FORIAN
INC. |
|
CONDENSED
CONSOLIDATED BALANCE SHEETS |
|
|
|
|
|
|
|
|
|
|
|
|
June
30, |
|
December
31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
(UNAUDITED) |
|
|
|
ASSETS |
|
|
|
|
Current
assets: |
|
|
|
|
Cash and cash equivalents |
$ |
1,999,118 |
|
|
$ |
6,042,986 |
|
|
Marketable securities |
|
46,011,230 |
|
|
|
42,296,589 |
|
|
Accounts receivable, net |
|
3,670,368 |
|
|
|
2,572,931 |
|
|
Proceeds receivable from sale of discontinued operation, net |
|
- |
|
|
|
1,645,954 |
|
|
Contract assets |
|
955,355 |
|
|
|
1,126,713 |
|
|
Prepaid expenses |
|
1,015,985 |
|
|
|
1,077,233 |
|
|
Other assets |
|
2,783,185 |
|
|
|
2,515,509 |
|
|
Total current assets |
|
56,435,241 |
|
|
|
57,277,915 |
|
|
|
|
|
|
|
Property and
equipment, net |
|
59,309 |
|
|
|
76,085 |
|
|
Right of use
assets, net |
|
46,876 |
|
|
|
10,664 |
|
|
Deposits and
other assets |
|
1,828,425 |
|
|
|
1,523,948 |
|
|
Total assets |
$ |
58,369,851 |
|
|
$ |
58,888,612 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
$ |
1,489,766 |
|
|
$ |
161,590 |
|
|
Accrued expenses |
|
3,320,571 |
|
|
|
4,252,257 |
|
|
Short-term operating lease liabilities |
|
22,872 |
|
|
|
10,664 |
|
|
Warrant liability |
|
20 |
|
|
|
563 |
|
|
Deferred revenues |
|
3,202,703 |
|
|
|
2,413,551 |
|
|
Total current liabilities |
|
8,035,932 |
|
|
|
6,838,625 |
|
|
|
|
|
|
|
Long-term
liabilities: |
|
|
|
|
Other liabilities |
|
524,004 |
|
|
|
1,000,000 |
|
|
Convertible notes payable, net of debt issuance costs ($6,000,000
in principal is held by a related party) |
|
24,175,094 |
|
|
|
24,870,181 |
|
|
Total long-term liabilities |
|
24,699,098 |
|
|
|
25,870,181 |
|
|
|
|
|
|
|
Total liabilities |
|
32,735,030 |
|
|
|
32,708,806 |
|
|
|
|
|
|
|
Commitments
and contingencies |
|
|
|
|
Stockholders' equity: |
|
|
|
|
Preferred Stock; par value $0.001; 5,000,000 Shares authorized; 0
issued and outstanding as of June 30, 2024 and December 31,
2023 |
|
- |
|
|
|
- |
|
|
Common Stock; par value $0.001; 95,000,000 Shares authorized;
31,110,187 issued and outstanding as of March 31, 2024 and
30,920,450 issued and outstanding as of December 31, 2023 |
|
31,110 |
|
|
|
30,920 |
|
|
Additional paid-in capital |
|
77,054,999 |
|
|
|
73,834,300 |
|
|
Accumulated deficit |
|
(51,451,288 |
) |
|
|
(47,685,414 |
) |
|
Total stockholders' equity |
|
25,634,821 |
|
|
|
26,179,806 |
|
|
Total liabilities and stockholders' equity |
$ |
58,369,851 |
|
|
$ |
58,888,612 |
|
|
|
|
|
|
|
|
|
|
|
|
FORIAN
INC. |
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
|
|
|
(UNAUDITED) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
|
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
4,777,101 |
|
|
$ |
4,893,542 |
|
|
$ |
9,654,479 |
|
|
$ |
9,763,929 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses: |
|
|
|
|
|
|
|
|
|
Cost of
revenue |
|
1,806,918 |
|
|
|
1,276,712 |
|
|
|
3,510,275 |
|
|
|
2,528,927 |
|
|
|
Research and
development |
|
307,201 |
|
|
|
304,187 |
|
|
|
697,090 |
|
|
|
835,876 |
|
|
|
Sales and
marketing |
|
1,017,659 |
|
|
|
1,237,327 |
|
|
|
2,072,800 |
|
|
|
2,433,519 |
|
|
|
General and
administrative |
|
3,665,601 |
|
|
|
3,198,290 |
|
|
|
6,949,090 |
|
|
|
6,753,765 |
|
|
|
Separation
expenses |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
599,832 |
|
|
|
Depreciation
and amortization |
|
7,889 |
|
|
|
15,257 |
|
|
|
16,776 |
|
|
|
53,687 |
|
|
|
Litigation
settlements and related expenses |
|
942,311 |
|
|
|
350,309 |
|
|
|
1,151,276 |
|
|
|
434,660 |
|
|
|
Total costs
and expenses |
|
7,747,579 |
|
|
|
6,382,082 |
|
|
|
14,397,307 |
|
|
|
13,640,266 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss From Continuing Operations |
|
(2,970,478 |
) |
|
|
(1,488,540 |
) |
|
|
(4,742,828 |
) |
|
|
(3,876,337 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense): |
|
|
|
|
|
|
|
|
|
Change in
fair value of warrant liability |
|
430 |
|
|
|
8,053 |
|
|
|
543 |
|
|
|
2,494 |
|
|
|
Interest and
investment income |
|
618,316 |
|
|
|
637,032 |
|
|
|
1,293,473 |
|
|
|
1,019,954 |
|
|
|
Gain on sale
of investment |
|
- |
|
|
|
- |
|
|
|
48,612 |
|
|
|
- |
|
|
|
Interest
expense |
|
(193,306 |
) |
|
|
(210,758 |
) |
|
|
(392,269 |
) |
|
|
(419,214 |
) |
|
|
Gain on debt
redemption |
|
- |
|
|
|
- |
|
|
|
137,356 |
|
|
|
- |
|
|
|
Total other
income (expense), net |
|
425,440 |
|
|
|
434,327 |
|
|
|
1,087,715 |
|
|
|
603,234 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
continuing operations before income taxes |
|
(2,545,038 |
) |
|
|
(1,054,213 |
) |
|
|
(3,655,113 |
) |
|
|
(3,273,103 |
) |
|
|
Income
taxes |
|
(8,221 |
) |
|
|
(36,187 |
) |
|
|
(110,761 |
) |
|
|
(66,096 |
) |
|
|
Loss from
continuing operations, net of tax |
|
(2,553,259 |
) |
|
|
(1,090,400 |
) |
|
|
(3,765,874 |
) |
|
|
(3,339,199 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
discontinued operations |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(94,427 |
) |
|
|
Gain on sale
of discontinued operations |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
11,531,849 |
|
|
|
Income tax
effect on discontinued operations |
|
- |
|
|
|
(32,426 |
) |
|
|
- |
|
|
|
(2,722,570 |
) |
|
|
Income from
discontinued operations, net of tax |
|
- |
|
|
|
(32,426 |
) |
|
|
- |
|
|
|
8,714,852 |
|
|
|
Net
(loss) income |
$ |
(2,553,259 |
) |
|
$ |
(1,122,826 |
) |
|
$ |
(3,765,874 |
) |
|
$ |
5,375,653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)
income per share |
|
|
|
|
|
|
|
|
|
Basic and
diluted |
|
|
|
|
|
|
|
|
|
Continuing operations |
$ |
(0.08 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.12 |
) |
|
$ |
(0.10 |
) |
|
|
Discontinued operations |
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
0.27 |
|
|
|
Net (loss)
income per share - basic and diluted |
$ |
(0.08 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.12 |
) |
|
$ |
0.17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding |
|
31,098,497 |
|
|
|
32,260,992 |
|
|
|
31,049,647 |
|
|
|
32,369,904 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FORIAN
INC. |
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
|
|
|
|
|
(UNAUDITED) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Period Ended June 30, |
|
|
|
|
|
|
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(3,765,874 |
) |
|
$ |
5,375,653 |
|
|
|
|
|
|
|
Less: Income from discontinued operations |
|
|
- |
|
|
|
8,714,852 |
|
|
|
|
|
|
|
Loss from continuing operations |
|
|
(3,765,874 |
) |
|
|
(3,339,199 |
) |
|
|
|
|
|
|
Adjustments to reconcile net (loss) income to net cash provided by
(used in) operating activities - continuing operations: |
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
16,776 |
|
|
|
53,687 |
|
|
|
|
|
|
|
Amortization on right of use asset |
|
|
10,664 |
|
|
|
11,724 |
|
|
|
|
|
|
|
Amortization of debt issuance costs |
|
|
2,667 |
|
|
|
2,667 |
|
|
|
|
|
|
|
Accrued interest on convertible Notes |
|
|
389,602 |
|
|
|
416,548 |
|
|
|
|
|
|
|
Amortization of discount - proceeds from sale of discontinued
operations |
|
|
(20,712 |
) |
|
|
(245,041 |
) |
|
|
|
|
|
|
Accretion of discount - marketable securities |
|
|
(1,237,337 |
) |
|
|
(767,533 |
) |
|
|
|
|
|
` |
Gain on sale of investment |
|
|
(48,612 |
) |
|
|
- |
|
|
|
|
|
|
|
Gain on debt redemption |
|
|
(137,356 |
) |
|
|
- |
|
|
|
|
|
|
|
Provision for doubtful accounts |
|
|
168,750 |
|
|
|
- |
|
|
|
|
|
|
|
Stock-based compensation expense |
|
|
3,321,551 |
|
|
|
3,368,575 |
|
|
|
|
|
|
|
Change in fair value of warrant liability |
|
|
(543 |
) |
|
|
(2,494 |
) |
|
|
|
|
|
|
Change in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(1,266,187 |
) |
|
|
(2,030,800 |
) |
|
|
|
|
|
|
Contract assets |
|
|
171,358 |
|
|
|
442,616 |
|
|
|
|
|
|
|
Prepaid expenses |
|
|
61,248 |
|
|
|
(132,344 |
) |
|
|
|
|
|
|
Changes in lease liabilities during the period |
|
|
(21,624 |
) |
|
|
(11,724 |
) |
|
|
|
|
|
|
Deposits and other assets |
|
|
(572,153 |
) |
|
|
(235,656 |
) |
|
|
|
|
|
|
Accounts payable |
|
|
1,328,176 |
|
|
|
605,437 |
|
|
|
|
|
|
|
Accrued expenses |
|
|
(931,686 |
) |
|
|
(236,088 |
) |
|
|
|
|
|
|
Deferred revenues |
|
|
789,152 |
|
|
|
681,476 |
|
|
|
|
|
|
|
Other liabilities |
|
|
(489,040 |
) |
|
|
- |
|
|
|
|
|
|
|
Net cash used in operating activities - continuing operations |
|
|
(2,231,180 |
) |
|
|
(1,418,149 |
) |
|
|
|
|
|
|
Net cash used in operating activities - discontinued
operations |
|
|
- |
|
|
|
(59,075 |
) |
|
|
|
|
|
|
Net cash used in operating activities |
|
|
(2,231,180 |
) |
|
|
(1,477,224 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
|
Additions to property and equipment |
|
|
- |
|
|
|
(75,493 |
) |
|
|
|
|
|
|
Purchase of marketable securities |
|
|
(87,732,380 |
) |
|
|
(61,573,237 |
) |
|
|
|
|
|
|
Sale of marketable securities |
|
|
85,255,076 |
|
|
|
41,392,821 |
|
|
|
|
|
|
|
Proceeds from sale of investment |
|
|
48,612 |
|
|
|
- |
|
|
|
|
|
|
|
Cash from sale of discontinued operations |
|
|
1,666,666 |
|
|
|
21,967,193 |
|
|
|
|
|
|
|
Net cash (used in) provided by investing activities - continuing
operations |
|
|
(762,026 |
) |
|
|
1,711,284 |
|
|
|
|
|
|
|
Net cash (used in) provided by investing
activities |
|
|
(762,026 |
) |
|
|
1,711,284 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
|
Cash used to redeem convertible notes |
|
|
(950,000 |
) |
|
|
- |
|
|
|
|
|
|
|
Tax payments related to shares withheld for vested restricted stock
units |
|
|
(100,662 |
) |
|
|
(127,357 |
) |
|
|
|
|
|
|
Net cash used in financing activities- continuing operations |
|
|
(1,050,662 |
) |
|
|
(127,357 |
) |
|
|
|
|
|
|
Net cash used in financing activities |
|
|
(1,050,662 |
) |
|
|
(127,357 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change
in cash |
|
|
(4,043,868 |
) |
|
|
106,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents, beginning of period |
|
|
6,042,986 |
|
|
|
2,795,743 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents, end of period |
|
$ |
1,999,118 |
|
|
$ |
2,902,446 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure of cash flow
information: |
|
|
|
|
|
|
|
|
|
|
Cash for
paid for taxes |
|
$ |
48,492 |
|
|
$ |
1,423,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
In this press release, we have provided certain non-GAAP
measures, which we define as financial information that has not
been prepared in accordance with U.S. GAAP. The non-GAAP financial
measure provided herein is earnings before interest, taxes,
non-cash and other items (“Adjusted EBITDA”), which should be
viewed as supplemental to, and not as an alternative for, net
income or loss calculated in accordance with U.S. GAAP (referred to
below as “net loss”).
Adjusted EBITDA is used by our management as an additional
measure of our Company’s performance for purposes of business
decision-making, including developing budgets, managing
expenditures and evaluating potential acquisitions or divestitures.
Period-to-period comparisons of Adjusted EBITDA help our management
identify additional trends in our Company’s financial results that
may not be shown solely by period-to-period comparisons of net
income. In addition, we may use Adjusted EBITDA in the incentive
compensation programs applicable to some of our employees in order
to evaluate our Company’s performance. Our management recognizes
that Adjusted EBITDA has inherent limitations because of the
excluded items, particularly those items that are recurring in
nature. In order to compensate for those limitations, management
also reviews the specific items that are excluded from Adjusted
EBITDA, but included in net income, as well as trends in those
items.
We believe that the presentation of Adjusted EBITDA is useful to
investors in their analysis of our results for reasons similar to
the reasons why our management finds it useful and because it helps
facilitate investor understanding of decisions made by management
in light of the performance metrics used in making those decisions.
In addition, as more fully described below, we believe that
providing Adjusted EBITDA, together with a reconciliation of net
loss to Adjusted EBITDA, helps investors make comparisons between
our Company and other companies that may have different capital
structures, different effective income tax rates and tax
attributes, different capitalized asset values and/or different
forms of employee compensation. However, Adjusted EBITDA is not
intended as a substitute for comparisons based on net loss. In
making any comparisons to other companies, investors need to be
aware that companies use different non-GAAP measures to evaluate
their financial performance. Investors should pay close attention
to the specific definition being used and to the reconciliation
between such measures and the corresponding U.S. GAAP measures
provided by each company under applicable SEC rules.
The following is an explanation of the items excluded by us from
Adjusted EBITDA but included in net loss:
- Depreciation and Amortization. Depreciation
and amortization expense is a non-cash expense relating to capital
expenditures and intangible assets arising from acquisitions that
are expensed on a straight-line basis over the estimated useful
life of the related assets. The Company excludes depreciation and
amortization expense from Adjusted EBITDA because management
believes that (i) the amount of such expenses in any specific
period may not directly correlate to the underlying performance of
the business operations and (ii) such expenses can vary
significantly between periods as a result of new acquisitions and
full amortization of previously acquired tangible and intangible
assets. Accordingly, management believes that this exclusion
assists management and investors in making period-to-period
comparisons of operating performance. Investors should note that
the use of tangible and intangible assets contributed to revenue in
the periods presented and will contribute to future revenue
generation and should also note that such expense will recur in
future periods.
- Stock-Based Compensation Expense. Stock-based
compensation expense is a non-cash expense arising from the grant
of stock-based awards to employees. Management believes that
excluding the effect of stock-based compensation from Adjusted
EBITDA assists management and investors in making period-to-period
comparisons in the Company’s operating performance because (i) the
amount of such expenses in any specific period may not directly
correlate to the underlying performance of business operations and
(ii) such expenses can vary significantly between periods as a
result of the timing of grants of new stock-based awards, including
grants in connection with acquisitions. Stock-based compensation
expense includes certain separation expenses related to the vesting
of stock options. Effective February 10, 2023, the Company’s Chief
Executive Officer, President and Class II member of the Board of
Directors resigned. In connection with the resignation, the Company
entered into a separation agreement providing for, among other
things, accelerated vesting of 106,656 unvested restricted shares
of the Company common stock. Stock based compensation expense for
2023 includes $349,832 related to the accelerated vesting of stock,
which is recognized in separation expenses in the condensed
consolidated statements of operations. These expenses were incurred
during the three months ended March 31, 2023, and there were no
additional related expenses incurred during the three months ended
June 30, 2023. Management believes that excluding stock-based
compensation from Adjusted EBITDA assists management and investors
in making meaningful comparisons between the Company’s operating
performance and the operating performance of other companies that
may use different forms of employee compensation or different
valuation methodologies for their stock-based compensation.
Investors should note that stock-based compensation is a key
incentive offered to employees whose efforts contributed to the
operating results in the periods presented and are expected to
contribute to operating results in future periods. Investors should
also note that such expenses will recur in the future.
- Interest Expense. Interest expense is
associated with the convertible notes entered into on September 1,
2021 in the amount of $24,000,000. The Notes are due on September
1, 2025, and accrue interest at an annual rate of 3.5%. Management
excludes interest expense from Adjusted EBITDA (i) because it is
not directly attributable to the performance of business operations
and, accordingly, its exclusion assists management and investors in
making period-to-period comparisons of operating performance and
(ii) to assist management and investors in making comparisons to
companies with different capital structures. Investors should note
that interest expense associated with the Notes will recur in
future periods.
- Investment Income. Investment income is
associated with the level of marketable debt securities and other
interest-bearing accounts in which the Company invests. Interest
and investment income can vary over time due to changes in interest
rates and level of investments. Management excludes interest and
investment income from Adjusted EBITDA (i) because these items are
not directly attributable to the performance of business operations
and, accordingly, their exclusion assists management and investors
in making period-to-period comparisons of operating performance and
(ii) to assist management and investors in making comparisons to
companies with different capital structures. Investors should note
that interest income will recur in future periods.
- Other Items. The Company engages in other
activities and transactions that can impact net income (loss). In
the periods reported, these other items included (i) change in fair
value of warrant liability relating to warrants assumed in the
acquisition of Helix; (ii) gain on sale of investment relating to
the sale of a minority equity interest; and (iii) gain on debt
redemption which relates to a gain on the early retirement of a
portion of the convertible notes. Management excludes these other
items from Adjusted EBITDA because management believes these
activities or transactions are not directly attributable to the
performance of business operations and, accordingly, their
exclusion assists management and investors in making
period-to-period comparisons of operating performance. Investors
should note that some of these other items may recur in future
periods.
- Severance expenses. Effective February 10,
2023, the Company’s Chief Executive Officer, President and Class II
member of the Board of Directors resigned. In connection with the
resignation, the Company entered into a separation agreement
providing for, among other things, (i) salary continuation for
twelve months and (ii) accelerated vesting of 106,656 unvested
restricted shares of the Company common stock. Severance expenses
for the six months ended June 30, 2023 includes $250,000 related to
the salary continuation. Managements excludes these other items
from Adjusted EBITDA because management believes these costs are
not recurring and not directly attributable to the performance of
business operations and, accordingly, their exclusion assists
management and investors in making period-to-period comparisons of
operating performance. In addition, the Company records normal
course of business severance expenses in the operating expense line
item related to its employees’ activities.
- Litigation related expenses. Management
excludes litigation expenses that are extraordinary in nature and
are unrelated to the Company’s day-to-day business operations. The
nature of these expenses is primarily related to direct and
incremental third-party legal expenses associated with such
litigation, which pertains to entities acquired in the Helix
merger.
- Strategic review related expenses. Management
excludes certain professional expenses that are extraordinary in
nature and are unrelated to the Company’s day-to-day business
operations. The nature of these expenses is primarily related to a
strategic review of the Company’s operations.
- Income tax expense. Management excludes the
income tax expense from Adjusted EBITDA (i) because management
believes that the income tax expense is not directly attributable
to the underlying performance of business operations and,
accordingly, its exclusion assists management and investors in
making period-to-period comparisons of operating performance and
(ii) to assist management and investors in making comparisons to
companies with different tax attributes.
There are limitations to using non-GAAP financial measures
because non-GAAP financial measures are not prepared in accordance
with U.S. GAAP and may be different from non-GAAP financial
measures provided by other companies.
The non-GAAP financial measures are limited in value because
they exclude certain items that may have a material impact upon our
reported financial results. In addition, they are subject to
inherent limitations as they reflect the exercise of judgments by
management about which items are adjusted to calculate our non-GAAP
financial measures. We compensate for these limitations by
analyzing current and future results on a U.S. GAAP basis as well
as a non-GAAP basis and also by providing U.S. GAAP measures in our
public disclosures.
Non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, financial information
prepared in accordance with U.S. GAAP. We encourage investors and
others to review our financial information in its entirety, not to
rely on any single financial measure to evaluate our business and
to view our non-GAAP financial measures in conjunction with the
most directly comparable U.S. GAAP financial measures.
The following table reconciles the specific
items excluded from U.S. GAAP metrics in the calculation of
non-GAAP metrics for the periods shown below:
FORIAN
INC. |
RECONCILIATION OF US GAAP TO NON-GAAP FINANCIAL
MEASURES |
(UNAUDITED) |
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, |
|
For the Six Months Ended June 30, |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
Revenue |
$ |
4,777,101 |
|
|
$ |
4,893,542 |
|
|
$ |
9,654,479 |
|
|
$ |
9,763,929 |
|
|
|
|
|
|
|
|
|
Net
loss from continuing operations |
$ |
(2,553,259 |
) |
|
$ |
(1,090,400 |
) |
|
$ |
(3,765,874 |
) |
|
$ |
(3,339,199 |
) |
|
|
|
|
|
|
|
|
Depreciation
and amortization |
|
7,889 |
|
|
|
15,257 |
|
|
|
16,776 |
|
|
|
53,687 |
|
Stock based
compensation expense |
|
1,662,636 |
|
|
|
1,540,342 |
|
|
|
3,321,551 |
|
|
|
3,368,575 |
|
Change in
fair value of warrant liability |
|
(430 |
) |
|
|
(8,053 |
) |
|
|
(543 |
) |
|
|
(2,494 |
) |
Interest and
investment income |
|
(618,316 |
) |
|
|
(637,032 |
) |
|
|
(1,293,473 |
) |
|
|
(1,019,954 |
) |
Interest
expense |
|
193,306 |
|
|
|
210,758 |
|
|
|
392,269 |
|
|
|
419,214 |
|
Gain on sale
of investment |
|
- |
|
|
|
- |
|
|
|
(48,612 |
) |
|
|
- |
|
Gain on debt
redemption |
|
- |
|
|
|
- |
|
|
|
(137,356 |
) |
|
|
- |
|
Severance
expense |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
250,000 |
|
Litigation
settlement and related expenses |
|
942,311 |
|
|
|
350,309 |
|
|
|
1,151,276 |
|
|
|
434,660 |
|
Strategic
review related expenses |
|
435,844 |
|
|
|
|
|
435,844 |
|
|
|
Income tax
expense |
|
8,221 |
|
|
|
36,187 |
|
|
|
110,761 |
|
|
|
66,096 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA - continuing operations |
$ |
78,202 |
|
|
$ |
417,368 |
|
|
$ |
182,619 |
|
|
$ |
230,585 |
|
|
|
|
|
|
|
|
|
Forian (NASDAQ:FORA)
過去 株価チャート
から 7 2024 まで 8 2024
Forian (NASDAQ:FORA)
過去 株価チャート
から 8 2023 まで 8 2024