Streamline Health Solutions, Inc.

Greetings. Welcome to Streamline Health's third quarter 2021 conference call. At this time, all participants will be in the listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note that today's conference is being recorded. I will now turn the conference over to Jacob Goldberger. Mr. Goldberger, you may now begin.

Thank you for joining us for the Corporate Update and Financial Results Review of Streamlined Health Solutions for the third quarter of 2021, which ended October 31st, 2021. As the conference call operator indicated, my name is Jacob Goldberger. Joining me on the call today are T. Green, our President and Chief Executive Officer and Chairman of the Board, Randy Salisbury, Chief Sales and Marketing Officer, and Tom Gibson, Chief Financial Officer. At the conclusion of today's prepared remarks, we will open the call for a question and answer session. If anyone participating on today's call does not have a full-text copy of our press release announcing these results, you can retrieve it from the company's website at www.streamlinehealth.net or from numerous financial websites. Before we begin with prepared remarks, we want to be sure we are clear for everyone on the record how certain information which may be provided today, as with all of our earnings calls, should be viewed. We therefore submit to the record the following statement. Statements made on this conference call that are not historical facts are considered to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 These are subject to risks, uncertainties, assumptions, and other factors that could cause actual results to differ materially from those we may discuss. Please refer to the company's press release and filings made with the U.S. Securities and Exchange Commission, including our most recent Form 10-K Annual Report, which is on file with the SEC, for more information about these risks, uncertainties, and assumptions, and other factors. As always, we are presenting management's current analysis of these items as of today. Participants on this call should take into account these risks when evaluating the topics we will discuss. Please note, Streamlined Health is not undertaking any commitment or obligation to publicly revise any such forward-looking statements made today. On today's call, we will discuss non-GAAP financial measures, such as adjusted EBITDA, and unordered figures related to our recent acquisition of Avalie. Management uses these measures to help provide better insight into our financial performance. However, certain items of income and expense are not included in these measures, so these calculations may differ from those which another entity may utilize in calculating their own non-GAAP measures. To help you compare these amounts on consistent terms, please refer to our website at www.streamlinehealth.net and our earnings release for a reconciliation of such non-GAAP measures to the most complete GAAP measures. I would now like to turn the call over to T. Green, our President and Chief Executive Officer.

Thank you, Jacob, and thank you all for joining us this morning. As we have previously announced, on August 16th, we acquired Abilene, and going forward, their financial performance will be included in our GAAP results from that date. As a company, we continue to follow a simple formula for successful growth. Innovation plus service equals growth. Our goal is to back up our innovative, industry-leading solutions, like Evaluator and RevID, with a world-class customer success team to create a community of customers that enhances our potential for long-term revenue growth. Today, Our flagship solutions, Evaluator and RevID, are leading an industry movement to help our hospital customers capture 100% of the revenue they have earned for the care they have provided through revenue integrity validation before a bill goes out the door. Our focus on shifting revenue integrity practices to the front end of the revenue cycle yields significant return on investment for our customers and is driving our rapid SaaS revenue growth. To capitalize on the significant opportunity in front of us, we make key investments in the evaluator side of our business throughout the year, especially in sales. Today, we have built out a direct sales force with four high-profile regional vice presidents, all of whom have demonstrated a track record of closing deals. We have partnered each of these RVPs with a business development representative to open more doors and schedule evaluator presentations with our prospective customers. The investments into our new RVPs and their BDR partners are in addition to our previously announced hiring of Lance Siech, our Senior VP of Business Development, who has been instrumental in signing some of our most meaningful channel partner agreements. The investment we made in sales talent has increased the number of evaluator prospects in our sales pipeline. As previously announced, evaluator was the subject of a positive report published by Class Research a leading healthcare IT research firm. Class is a resource that hospital executives use for guidance on what to buy. The report highlighted the strong capabilities of Evaluator and our customer satisfaction with the technology. Class research conducted surveys with standalone hospitals and found that 100% of customers saw very positive outcomes within six months and universally agreed they would buy Evaluator again. There was high praise for evaluators' targeted reporting and robust rule sets, as well as Streamline's willingness and ability to make enhancements to the system. We believe well-regarded third-party confirmation of our innovative products and strong customer service reflects the reputation that Streamline is building in the healthcare community. Within the Avali business, while we plan to make additional investments into the sales team, we are currently focused on the eye, in the S functions of our growth equation, innovation and service. We recently hired a new technology leader whose focus will be ensuring that Avalit software remains highly scalable. To strengthen Avalit's service function, we added a new service leader who will be responsible for overseeing its customer success team to ensure the highest level of customer satisfaction. Moving now to our financial results. On an unaudited pro forma basis, Assuming we had owned Avalit for the entirety of our fiscal third quarter of this and last year, total revenue was approximately $6.1 million, up 17% compared to approximately $5.2 million during the third quarter of 2020. Pro forma unaudited SAS revenue totaled approximately $3.1 million, an 81% increase compared to approximately $1.7 million during the prior year period. Moving now to our GAAP consolidated financial results for the three months ended October 31st. Total revenue for the third quarter of 2021 was $5.5 million, 109% increase from the third quarter of 2020. Notably, our SAS revenue grew 214% from the third quarter of 2020 to 2021. Recurring revenue accounted for 71% of total revenue this quarter compared to 75% for the third quarter of 2020. Third quarter 2021 adjusted EBITDA was a loss of $300,000 compared to an adjusted EBITDA loss of $700,000 during the third quarter of 2020. As of October 31st, 2021, we had $10.4 million of cash on hand with $10 million of debt related to a term loan, which we entered into with Ridge Bank. subsequent to the acquisition of Avalit. To close the Avalit acquisition, we utilized approximately $12.4 million of our cash and issued approximately $6.6 million of restricted stock to the sellers. In addition to the closing consideration, we contracted an earn-out over the next two sequential 12-month anniversaries of the closing of Avalit that is tied to Avalit's performance and includes a combination of cash and restricted common stock. Our cap table remains very clean with only one class of common stock. Tom Gibson, our CFO, will provide additional details about our financials during his prepared remarks. Now I'll turn the call over to Randy Salisbury for an update on sales. Randy?