Streamline Health Solutions, Inc.

Greetings and welcome to the Streamlined Health fourth quarter and fiscal year 2022 earnings conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jacob Goldberg. Thank you, sir. You may begin.

Thank you for joining us for the corporate update and financial results review of Streamlined Health Solutions for the fourth quarter and fiscal year 2022, which ended January 31st, 2023. As the conference call operator indicated, my name is Jacob Goldberger. Joining me on the call today are T. Green, Chief Executive Officer and Chairman of the Board, Ben Stillwell, President, 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 for 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 releases 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, Streamline 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, booked SAS ACV, and unaudited figures related to our acquisition of AdLead. 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 comparable GAAP measures. I would now like to turn the call over to T. Green, Chief Executive Officer and Chairman of the Board.

Thank you, Jacob, and thank you all for joining us this morning. Following my opening remarks, Ben Stilwell, President, will provide an operations and sales update, followed by a financial update from our CFO, Tom Gibson. As a reminder, on August 16, 2021, we acquired Avali, and their financial performance will be included in our GAAP results from that date. With that, I'll get started. Beginning with the financial overview. The total contract value of bookings for the 12 months into January 31, 2023 totaled $26.5 million, $22.4 million of which was attributable to our SAS products, an average of $5.6 million of SAS total contract value per quarter in 2022, exceeding our estimates of $3 to $5 million of TCV per quarter. Our booking success is a credit to the strong direct sales channel we've built and the value our products provide our clients. Macro headwinds associated with our hospital client staffing and backlog of IT projects continue to hinder conversion of new bookings to revenue. However, during the year, we successfully grew total revenue 43% to $24.9 million, and our SAS revenues increased $4.2 million, a 53% improvement compared to fiscal 2021. During 2022, we began reporting a new metric, Book SAS ACV, which is the annualized contract value for all agreements that are being recognized into revenue, as well as bookings that we have not been implemented. As previously reported, as of January 31st, Book SAS ACV was $17.2 million as compared to $10.6 million as of January 31st, 2022, exceeding our previously announced $17 million target. As of January 31st, 2023, We had $6.6 million of cash on our balance sheet and the balance on our term loan was $9.7 million. We believe our cash on hand is sufficient to achieve positive adjusted EBITDA, less capitalized software development in fiscal 2023. We have access to an additional $2 million of liquidity through our non-formula line of credit. We combined Avali and Evaluator operations on November 1st, 2022. Under Ben's leadership, the integration process has moved more quickly than we expected. Our Evaluator and Avalanche software solutions share a common selling call point. We have achieved significant cost savings from the integration, $1.5 million of which was executed on November 1st, 2022, and was attributable to the elimination of redundant management positions, voluntary reduction of executive salaries, and certain other contractors. We anticipate realizing an additional $1.5 million of cost savings throughout fiscal 2023 as compared to our models that had the business operating separately. Looking ahead to fiscal 2023, we expect the continued expansion of bulk SAS ACV will be a leading indicator of revenue growth to come and that the business will begin to realize strong incremental margins after achieving a break-even run rate during the second half of the year. Beyond continued growth from new logos and within our existing relationships, we have identified certain key corporate objectives for our existing business in 2023. They are, in no particular order, To have client leveraging both our flagship solutions, RevID and Evaluator, an Epic-based facility utilizing RevID, improved performance from our partner channel, and achieving a break-even adjusted even to our less capitalized software. Please note, as our SAS revenues and books SAS ACD continue to expand, we no longer believe that each individual contract signature is material news. Going forward, we will no longer press release individual bookings unless we deem them significant. We remain committed to keeping you apprised of our progress against our key corporate objectives and of significant contract signings. We remain confident in our growth prospects going forward. Our products and services are part of the answer for our hospital client and the macroeconomic burdens they are facing today. Unfortunately for our industry, that demand is not enough to guarantee success. Our clients are experiencing a continued hangover effect from the impacts of the COVID pandemic on their hospital operations, which has manifested in a backlog of potential high priority projects. Our team is working hard to ensure they are clearly communicating the impact of our automated pre-built solutions, which enable our clients to capture and build accurately for all the care they have provided. This has never been more critical to our industry than it is today, and we believe our bookings will continue to accelerate as a result. We maintain our stated goal to exit fiscal 2023 with $30 million of booked SAS ACV. With that, I'd like to turn the call over to our president, Mr. Ben Stiller.