Reduces Operating Expense by over $5 million and Net Loss by over 50% compared to
2023
TAMPA,
Fla., May 9, 2024 /PRNewswire/ --
Marpai, Inc. ("Marpai" or the "Company") (Nasdaq:
MRAI), an independent national Third-Party Administration
(TPA) company transforming the $22
billion TPA market supporting self-funded employer health
plans with affordable, intelligent, healthcare, today announced
financial results for the first quarter of 2024. The Company
expects to hold a webcast to discuss the results on May 10, 2024.
Q1 2024 Financial Highlights:
- Net revenues were approximately $7.4
million for the three months ended March 31, 2024, down $2.3
million, or 24% lower year over year, compared to the three
months ended March 31, 2023.
- Gross profit was $2.5 million for
the three months ended March 31,
2024, down $0.7 million, or
23% lower year over year compared to the three months ended
March 31, 2023.
- Operating expenses were $6.6
million for the three months ended March 31, 2024, an improvement of $5.2 million, or 44% lower year over year
compared to the three months ended March 31,
2023.
- Operating loss was $4.1 million
for the three months ended March 31,
2024, an improvement of $4.5
million, or 52% lower year over year compared to the three
months ended March 31, 2023.
- Net loss was $4.3 million for the
three months ended March 31, 2024, an
improvement of $4.5 million, or 51%
lower year over year compared to the three months ended
March 31, 2023.
- Basic and diluted earnings per share were ($0.46) for the three months ended March 31, 2024, an improvement of $1.22 per share year over year compared to the
three months ended March 31,
2023.
"The market is evolving, and we're adapting our approach to
better serve our clients' needs. While we saw some client turnover
in the first quarter, we are confident that our new initiatives
will lead to long-term revenue growth and profitability," said
Damien Lamendola, Chief Executive
Officer of Marpai. "We are very pleased to have added a new "off
cycle" client in Q1 and the expansion of our sales team with two
highly successful industry executives."
John Powers, Marpai President
commented, "Marpai is delivering on its promise to save! Our focus
on operational efficiency has significantly reduced operating
expenses. Building on this success, as previously announced, we
implemented an additional cost-reduction program expected to
generate $3 million in annual
savings. Marpai remains dedicated to its core mission: reducing
client costs and improving member care through continuous
operational and financial improvements."
Webcast and Conference Call Information
Marpai expects to host a conference call and webcast on
Friday, May 10, 2024, at 8:30 a.m. ET to answer questions about the
Company's operational and financial highlights for its first
quarter ended March 31, 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/MVqDW74kNpl
About Marpai, Inc.
Marpai, Inc. (Nasdaq: MRAI) is a leading, national TPA company
bringing 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 is confident that its
new initiatives will lead to long-term revenue growth and
profitability and that its additional cost-reduction program is
expected to generate $3 million in
annual savings. 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)
|
|
|
|
March 31,
2024
|
|
December 31,
2023
|
|
|
|
|
|
ASSETS:
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
851
|
|
$
1,147
|
Restricted
cash
|
|
12,761
|
|
12,345
|
Accounts receivable,
net of allowance for credit losses of $25 and $25
|
|
366
|
|
1,124
|
Unbilled
receivable
|
|
727
|
|
768
|
Due from buyer for sale
of business unit
|
|
800
|
|
800
|
Prepaid expenses and
other current assets
|
|
1,000
|
|
901
|
Total current
assets
|
|
16,505
|
|
17,085
|
|
|
|
|
|
Property and equipment,
net
|
|
579
|
|
611
|
Capitalized software,
net
|
|
1,512
|
|
2,127
|
Operating lease
right-of-use assets
|
|
2,311
|
|
2,373
|
Goodwill
|
|
3,018
|
|
3,018
|
Intangible assets,
net
|
|
4,874
|
|
5,177
|
Security
deposits
|
|
1,267
|
|
1,267
|
Other long-term
asset
|
|
22
|
|
22
|
Total
assets
|
|
$
30,088
|
|
$
31,680
|
LIABILITIES AND
STOCKHOLDERS' (DEFICIT) EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
3,824
|
|
$
4,649
|
Accrued
expenses
|
|
3,076
|
|
2,816
|
Accrued fiduciary
obligations
|
|
9,510
|
|
11,573
|
Deferred
revenue
|
|
1,481
|
|
661
|
Current portion of
operating lease liabilities
|
|
523
|
|
512
|
Other short-term
liabilities
|
|
1,709
|
|
632
|
Total current
liabilities
|
|
20,123
|
|
20,843
|
|
|
|
|
|
Other long-term
liabilities
|
|
19,724
|
|
19,401
|
Operating lease
liabilities, net of current portion
|
|
3,547
|
|
3,684
|
Deferred tax
liabilities
|
|
1,190
|
|
1,190
|
Total
liabilities
|
|
44,584
|
|
45,118
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
STOCKHOLDERS'
(DEFICIT) EQUITY
|
|
|
|
|
Common stock, $0.0001
par value, 227,791,050 shares authorized; 10,308,038 shares
and 7,960,938 shares issued and outstanding at March
31, 2024 and
December 31, 2023, respectively (1)
|
|
1
|
|
1
|
Additional paid-in
capital
|
|
66,595
|
|
63,307
|
Accumulated
deficit
|
|
(81,092)
|
|
(76,746)
|
Total stockholders'
(deficit) equity
|
|
(14,496)
|
|
(13,438)
|
Total liabilities
and stockholders' (deficit) equity
|
|
$
30,088
|
|
$
31,680
|
|
(1)
Reflects 1-for-4 reverse stock split that became effective
June 29, 2023. See Note 1 to the unaudited condensed consolidated
financial statements.
|
MARPAI, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS
|
(in thousands, except
share and per share data)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
March 31,
2024
|
|
March 31,
2023
|
Revenue
|
|
$
7,385
|
|
$
9,672
|
Costs and
expenses
|
|
|
|
|
Cost of revenue
(exclusive of depreciation and amortization
shown separately below)
|
|
4,871
|
|
6,409
|
General and
administrative
|
|
3,421
|
|
5,226
|
Sales and
marketing
|
|
602
|
|
2,179
|
Information
technology
|
|
1,124
|
|
2,187
|
Research and
development
|
|
7
|
|
500
|
Depreciation and
amortization
|
|
951
|
|
1,044
|
Facilities
|
|
474
|
|
650
|
Total costs and
expenses
|
|
11,450
|
|
18,195
|
Operating
loss
|
|
(4,065)
|
|
(8,523)
|
Other income
(expenses)
|
|
|
|
|
Other income
|
|
120
|
|
50
|
Interest expense,
net
|
|
(398)
|
|
(385)
|
Foreign exchange (loss)
gain
|
|
(3)
|
|
(15)
|
Loss before
provision for income taxes
|
|
(4,346)
|
|
(8,873)
|
Income tax
expense
|
|
—
|
|
—
|
Net
loss
|
|
$
(4,346)
|
|
$
(8,873)
|
Net loss per share,
basic & fully diluted (1)
|
|
$
(0.46)
|
|
$
(1.68)
|
Weighted average
common shares outstanding, basic and
diluted (1)
|
|
9,405,775
|
|
5,290,661
|
|
(1)
Reflects 1-for-4 reverse stock split that became effective
June 29, 2023. See Note 1 to the unaudited condensed consolidated
financial statements.
|
MARPAI, INC. AND
SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in thousands, except
share and per share data)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
March 31,
2024
|
|
March 31,
2023
|
Cash flows from
operating activities:
|
|
|
|
|
Net loss
|
|
$
(4,346)
|
|
$
(8,873)
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
951
|
|
1,044
|
Share-based
compensation
|
|
561
|
|
623
|
Common stock issued to
vendors in exchange for services
|
|
—
|
|
79
|
Amortization of
right-of-use asset
|
|
62
|
|
252
|
Non-cash
interest
|
|
423
|
|
388
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts receivable and
unbilled receivable
|
|
800
|
|
(239)
|
Prepaid expense and
other assets
|
|
(99)
|
|
162
|
Accounts
payable
|
|
(825)
|
|
653
|
Accrued
expenses
|
|
215
|
|
(1,416)
|
Accrued fiduciary
obligations
|
|
(2,063)
|
|
—
|
Operating lease
liabilities
|
|
(126)
|
|
(363)
|
Other
liabilities
|
|
862
|
|
1,149
|
Net cash used in
operating activities
|
|
(3,585)
|
|
(6,541)
|
Cash flows from
investing activities:
|
|
|
|
|
Disposal of property
and equipment
|
|
—
|
|
3
|
Net cash provided by
investing activities
|
|
—
|
|
3
|
Cash flows from
financing activities:
|
|
|
|
|
Proceeds from sale of
future cash receipts on accounts receivable
|
|
1,509
|
|
—
|
Payments to buyer of
receivables
|
|
(57)
|
|
—
|
Payments to seller for
acquisition
|
|
(474)
|
|
—
|
Proceeds from issuance
of common stock in a public offering, net
|
|
2,727
|
|
—
|
Net cash provided by
financing activities
|
|
3,705
|
|
—
|
|
|
|
|
|
Net increase
(decrease) in cash, cash equivalents and restricted
cash
|
|
120
|
|
(6,538)
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash at beginning of
period
|
|
13,492
|
|
23,117
|
Cash, cash
equivalents and restricted cash at end of period
|
|
$
13,612
|
|
$
16,579
|
|
|
|
|
|
Reconciliation of
cash, cash equivalents, and restricted cash reported in
the condensed consolidated balance
sheet
|
|
|
|
|
Cash and cash
equivalents
|
|
$
851
|
|
$
6,174
|
Restricted
cash
|
|
12,761
|
|
10,405
|
Total cash, cash
equivalents and restricted cash shown in the condensed
consolidated statement of cash flows
|
|
$
13,612
|
|
$
16,579
|
Supplemental
disclosure of non-cash activity
|
|
|
|
|
Measurement period
adjustment to Goodwill
|
|
$
—
|
|
$
36
|
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