LifeMD, Inc.

Good afternoon. Thank you for joining us today to discuss the results for LifeMD's third quarter, and it's September 30th, 2023. Joining the call today are Justin Schreiber, Chairman and Chief Executive Officer, and Mark Beathen, Chief Financial Officer of LifeMD. Following management's prepared remarks, we will open the call for a question and answer session. Before we begin, I'd like to remind everyone that during this call, the company will make a number of forward-looking statements which are subject to numerous risks and uncertainties that may cause actual results to differ materially from those projected. These risks and uncertainties are described in the company's 10-K and 10-Q filings and within other filings that LifeMD may have with the SEC from time to time. Forward-looking statements made during this call are based on current information available to the company as of today, November 8th, 2023. The company assumes no obligation to update or revise any forward-looking statements after today's call, except as required by law. Also, please note that management will be discussing certain non-GAAP financial measures that the company believes are important in evaluating LifeMD's performance. Details on the relationship between these non-GAAP measures to the most comparable GAAP measures and reconciliations thereof can be found in the press release issued earlier today. Finally, I'd like to remind everyone that today's call has been recorded and will be available for replay in the investor relations section of the company's website. Now I'd like to turn the call over to LIFE MD CEO, Justin Treiber. Please go ahead.

Thank you and good afternoon, everyone. After the market closed, we issued a press release announcing our third quarter results and posted an updated corporate presentation on our website at ir.lifemd.com. LifeMD had a tremendous third quarter with record revenue and profitability. Our core telehealth operations produced extremely strong results in both our lifestyle healthcare businesses, led by RexMD, our men's health brand, and our rapidly growing virtual primary care business, led by growth in our GLP-1 weight management offering. Our RexMD business grew 12% versus the year-ago period, with a net margin of 38% in the third quarter. The performance of our GLP-1 weight management business has been nothing short of exceptional, with revenue quadrupling over the prior quarter's results, far surpassing our projections. Looking ahead to Q4 and beyond, LifeMD is positioned to not just sustain but continue to build upon the tremendous success we've experienced throughout the year across our telehealth businesses and with Work Simply. I believe LifeMD is uniquely positioned for 2024 to be a record-setting year. To deliver excellent value for our shareholders, we remain laser-focused on the following four major strategic initiatives. First, our largest initiative in the year ahead is continued focus on accelerating the growth of our weight management program. Since launching in Q2 of this year, our weight management program has already attracted over 16,000 patient subscribers, representing more than 24 million of annual recurring revenue. Even as we scale our daily acquisition volume, this offering's economics remain tremendous, with our day one return on ad spend consistently exceeding 1x. Moreover, we anticipate several tailwinds to further accelerate the growth of this business into 2024, including continued growth in brand recognition of our weight management offering, two, LifeMD beginning to accept commercial and government insurance programs, which I will speak about in a moment, three, better availability of medications and likely expansion of insurance coverage in 2024 for GLP-1 medications, four, expanded therapeutic options within the GLP-1 drug class, including generic liraglutide and FDA approval, which happened today, of Manjaro for weight loss in adults with obesity, and five new growth channels from partnerships that are already in the works. Second, we remain focused on making substantial progress in the growth of our B2B enterprise program. As we announced during the third quarter, we executed an agreement with Ascend Therapeutics, a leader in the hormonal and women's health markets, which allows Ascend to leverage LifeMD's cutting-edge telehealth platform, data capabilities, and healthcare marketing expertise to support its products. This not only generates ongoing fees for LifeMD, but also places the all-important patient-provider relationship within our affiliated medical group. LifeMD also executed a joint sales and marketing agreement with IQVIA, leveraging our leading telehealth infrastructure in partnership with IQVIA's comprehensive commercialization solutions. With a robust B2B pipeline, we expect to execute additional opportunities in the near future. Third, we have made and will continue to make significant progress in enrolling our affiliated medical group in commercial insurance plans. We expect to build our first console in Q4, and we'll be rolling out coverage nationwide throughout 2024. As commercial insurance becomes more embedded within our offerings, we expect it to significantly lower the out-of-pocket cost of our services to our patients and to be a big driver of overall patient satisfaction and retention. Additionally, we have already begun building an industry-leading compliance infrastructure for Medicare participation and anticipate being prepared to launch and scale this as soon as it makes sense for our patients and our business. We believe that participation in commercial and government insurance programs will fuel another leg of significant growth for LifeMD. And our fourth key initiative is continued focus on our lifestyle healthcare business, led by RexMD, where we continue to drive double-digit growth with net margins exceeding 30%. Our men's sexual health business continues to be highly profitable and shows no signs of slowing. In 2024, we see further opportunities to expand this rate of growth and profitability through the introduction of new complementary products, including ones geared toward hormone replacement therapy, weight management, and cardiovascular health. Lastly, WorkSimply continues to deliver exceptional results on both the top and bottom lines. This self-managed business is a meaningful contributor to LifeMD's overall profitability and cash flow. Moreover, WorkSimply has successfully diversified from a PDF solutions business to a diversified workplace services business, including HR solutions, digital signing, proprietary forms, AI technology, and plans to enter additional adjacent markets in 2024. WorkSimply now operates in 20 languages globally and has increased its once negligible small business customer penetration to approximately 15% of the total subscriber base today. We expect WorkSimply to generate at least 20% annual growth in 2024 with adjusted EBITDA margins of approximately 30%. In short, We're in a really exciting spot, and with that, I'll turn the call over to our CFO, Mark Benethen, who will provide a summary of our financial results.

Mark. Thank you, Justin, and good afternoon, everyone. LifeMD had record third quarter performance on both the top and bottom line, with consolidated net revenues growing to $38.6 million and consolidated adjusted EBITDA growing to $2.8 million. Additionally, we ended the quarter with over $15 million in cash, and our second consecutive quarter of positive operating cash flow. We are in a well-capitalized position to continue to execute upon our aggressive growth and profitability plans. Now turning to the results for the third quarter of 2023. As I mentioned, revenue in the third quarter totaled $38.6 million, an increase of 23% compared with the same year-ago period, and up 7% versus the second quarter. Total telehealth revenues grew 14% versus the year-ago period and 9% sequentially. Net revenues from our weight management business more than quadrupled versus the prior quarter. Subscriber growth remained very strong with the number of telehealth active subscribers increasing 22% to approximately 207,000 and work simply active subscribers increasing 14% to over 170,000, both versus the year-ago period. Consolidated gross margin for the third quarter was a record 88%, up 300 basis points versus the prior year period. Gross profit for the quarter totaled $33.8 million, an increase of 27% from the year-ago period. Operating expenses for the third quarter totaled $38.4 million, an increase of 4.6 million versus a year ago period, reflecting our discretionary increases in selling, marketing, clinical, and patient care expenses to support the rapid growth of our weight management offering. Net of these investments, operating expenses were flat year over year. Operating expenses in the third quarter included 5.2 million of non-cash expenses associated with stock-based comp, non-cash interest, depreciation, and amortization expenses. Are GAAP net loss attributable to common stockholders for the third quarter totaled $6.9 million or a loss of $0.20 per share? This compares to a GAAP net loss attributable to common stockholders of $8.1 million or a loss of $0.26 per share in the third quarter of 2022. Adjusted EPS is a non-GAAP financial measure that excludes non-cash expenses, dividends, stocks and insurance acceptance readiness, litigation expense, non-controlling interest, M&A expenses, financing transaction costs, and foreign currency translation. Reflecting those adjustments, adjusted diluted EPS for the third quarter of 2023 was $0.08 per share compared with a loss of $0.03 per share in the same year-ago period. Adjusted EBITDA, a non-GAAP financial measure that excludes the same items I noted for adjusted EPS, totaled $2.8 million in the third quarter of 2023. This compares with an adjusted EBITDA loss of $806,000 in the same year-ago quarter. Cash and cash equivalents totaled $15.3 million as of September 30, 2023. We believe the strength of our balance sheet and profitability of our current operations will more than adequately allow us to fund the growth in our business. For 2023, we expect to achieve the midpoint of our previously disclosed revenue range, more specifically revenue between $148 million and $149 million, and adjusted EBITDA between $10 million and $11 million, including the estimated impact of approximately $4 million of deferred revenue related to weight management resulting from the GAAP required amortization of fully paid subscription amounts over their initial time period. This wraps up our financial results. I'd now like to turn the call back over to Justin.