WELL Health Announces Results for Q4 and Full Year 2024 Reflecting Record Annual Revenue

WELL achieved annual revenue of $919.7 million in 2024, an increase of 19% compared to the prior year. Under applicable IFRS standards, revenue was negatively impacted by (i) a delay in the recognition of revenue for Circle Medical in the amount of $56.6 million and (ii) uncertainty of $24.5 million by CRH (related to the Change Healthcare cyberattack). Substantially all of the deferred Circle Medical revenue is expected to be recognized in 2025(3) and the CRH amount may be recognized as and when collections occur and when settlement terms are reached with Change Healthcare. Excluding such impacts, the Company was on track to achieve record revenue of $1.0 billion in 2024, an increase of 29% compared to the prior year.

WELL achieved record Free Cash Flow Attributable to Shareholders or "FCFA2S"(1) in 2024 of $49.3 million representing an increase of ~16% as compared to $42.4 million in 2023.  For 2024, due to the impact of the Circle Medical and CRH matters, Adjusted EBITDA(1) was $46.7 million, compared to Adjusted EBITDA of $113.4 million for 2023.  Excluding the impact from the Circle Medical and CRH matters, the Company was on track to achieve Adjusted EBITDA of $127 million for 2024, an increase of 12% compared to the prior year.

WELL is pleased to provide a positive outlook for 2025 with annual guidance for revenue of between $1.40 billion to $1.45 billion, and Adjusted EBITDA in the range of $190 million to $210 million. This guidance reflects 100% consolidation of HEALWELL (TSX:AIDX) as per IFRS control requirements and assumes that substantially all of the $56.6 million in deferred Circle Medical revenue will be recognized in 2025 (3). This guidance does not include any contribution from the $24 million in delayed earnings of CRH related to the cyberattack until further collections occur and this matter is settled with Change Healthcare.

VANCOUVER, BC, April 15, 2025 /PRNewswire/ - WELL Health Technologies Corp. (TSX:WELL) (the "Company" or "WELL"), a digital healthcare company focused on positively impacting health outcomes by leveraging technology to empower healthcare practitioners and their patients globally, is pleased to announce it has filed its audited annual financial statements for the fiscal year and fourth quarter ended December 31, 2024, the related management's discussion and analysis ("MD&A"), annual information form, and accompanying CEO and CFO certifications under its profile on SEDAR+ at www.sedarplus.ca. 

Hamed Shahbazi, Chairman and CEO of WELL commented, "Notwithstanding the impacts to our revenue from the Circle Medical revenue deferral and the Change Healthcare cyberattack matters, the fundamentals and outlook of our business have never been stronger. Despite these two IFRS revenue impacts, WELL delivered record annual revenue and Free Cash Flow Attributable to Shareholders(1) in fiscal 2024. WELL delivered 5.7 million patient visits in 2024, a 32% YoY increase from the prior year, of which the vast majority came from organic growth. In 2024, our Canadian business led the way with strong organic growth of 20%, growing revenue to approximately $387.4 million and Adjusted EBITDA(1) to $56.3 million representing growth of 30% and 22% respectively. Momentum is building in our total Canadian business, and we are anticipating continued Adjusted EBITDA growth of at least 25% in 2025 as we target reaching $800 million in revenue and $100 million in Adjusted EBITDA solely in our Canadian business by the end of 2026. These results are truly demonstrative of our unique platform and continued progress in tech enabling and supporting healthcare providers who are delivering outstanding care to millions of patients across North America. We are proud of our achievements in 2024 and thank the over 6,000 team members across WELL for their hard work and commitment to excellence. We are extremely well positioned to achieve our best year yet in 2025."

Update on Circle Medical

As previously disclosed, Circle Medical received a request from US regulators investigating certain of Circle Medical's billing practices in the U.S.  In the annual consolidated financial statements for the year ended December 31, 2024, the Company recognized an expense of USD $2.8 million for the year ended December 31, 2024, for estimated settlement costs.

In connection with the finalization of the Company's annual consolidated financial statements for the year ended December 31, 2024, it was determined that Circle Medical had billed and received payment for patient services that had been rendered during fiscal 2024, for which it had not yet met all the required criteria to recognize such revenue under applicable IFRS standards. As a result, the Company has recorded a revenue reduction of $56.6 million for fiscal 2024 and recognized cash received from customers of $53.9 million as deferred revenue as at December 31, 2024.  The Company expects to recognize substantially all of this deferred revenue during fiscal 2025 with the remainder recognized in fiscal 2026(3). As of April 11, 2025, WELL has already satisfied the criteria for revenue recognition in fiscal 2025 for approximately $6.7M of this deferred revenue. Although Circle Medical contributed a net loss to consolidated income and only contributed 2.3% to the Company's consolidated Adjusted EBITDA(1) in 2023, under IFRS, for fiscal 2024, the Company is required to recognize 100% of the expenses related to the $56.6 million that was deferred which results in a significant reduction in Adjusted EBITDA for fiscal 2024 and a significant positive contribution to Adjusted EBITDA for fiscal 2025 once the deferred revenue is recognized. The Company continues to seek strategic alternatives for Circle Medical and is committed to carrying out this process in due course. 

Impact to Revenue at CRH Due to Change Healthcare Cyberattack

CRH Anesthesia's primary billing service provider, Change Healthcare (or "Change HC") experienced a cybersecurity attack in February 2024 which sidelined the Change HC    Revenue Cycle Management service relied on by the Company for billings and collections.  This resulted in the Company experiencing delayed billing and cash collections on claims processed for several months during 2024. Due to this business interruption affecting a significant number of healthcare companies across the U.S., which rely on Change HC for revenue collection, Change HC's affiliate provided advance funding to many of its customers including CRH in lieu of the cash collections CRH would normally receive related to these claims.

During the fourth quarter of 2024, CRH updated key assumptions in its revenue recognition model related to the Change HC cyberattack and determined that it would delay the recognition of approximately $24.5 million of revenue in the fourth quarter of 2024 that otherwise would have been recognized during 2024 had the cyberattack not occurred. CRH expects to recognize these revenues if and when collections occur and/or once settlement terms have been reached with Change HC. Once this occurs, such earnings will result in almost 100% contribution to Adjusted EBITDA(1). Due to the uncertainty regarding the timing and amount that will be recovered, this has been excluded from our 2025 guidance.

Guidance and Outlook

WELL is expecting strong operational performance to continue into 2025 with a greater focus on leveraging all product and corporate synergies, with an emphasis on leveraging the depth of the product and technology offerings from WELLSTAR and HEALWELL. The Company also continues to focus the majority of its M&A and capital allocation activity in Canada where it is experiencing its highest returns on capital. Management will continue to pursue its focus on optimizing its operations for organic growth and profitability. As such, management is pleased to provide the following guidance: 

Annual revenue for 2025 is expected to be in the range of $1.40 billion to $1.45 billion 

Annual Adjusted EBITDA(1) for 2025 is expected to be in the range of $190 million to $210 million

WELL's 2025 guidance assumes, among other things, the following: 100% consolidation of HEALWELL results as per IFRS control requirements; substantially all of the $56.6 million in deferred Circle Medical revenue is expected to be recognized in 2025(3) and will result in close to 100% contribution to Adjusted EBITDA(1); the $24.5 million in CRH delayed earnings are not included in 2025 guidance until these amounts are collected and/or settled with Change HC, at which time our guidance would be enhanced.

Hamed Shahbazi, further added, "We are also very pleased to report that WELL is now a multi-national corporation with a geographic footprint in 11 countries following the exercise of our call option to acquire a 69% voting interest in HEALWELL, concurrent with its acquisition of Orion Health, a global leader in healthcare data interoperability. With HEALWELL and Orion now in the family, WELL has tremendous depth in not only delivering the best provider-focused technologies, for thousands of care providers, but also delivering healthcare data interoperability at scale for large enterprises and public sector clients in a variety of countries including the UK, Saudi Arabia, the UAE, the United States, France, Spain, Scotland, Northern Ireland, Australia, and New Zealand."  

Eva Fong, WELL's CFO commented, "We ended the year with a strong balance sheet as a result of our positive cashflow and are well positioned to execute on a deep M&A pipeline and ambitious agenda in 2025. I'm pleased to report that the Company is in good standing with its credit partners and in line with its bank covenants. Our business pipeline is growing substantially due to the emerging "buy Canadian" sentiment that we are seeing from the public sector in our most important market, Canada. We are committed to delivering for these important clients as well as our shareholders."

Fiscal 2024 Annual Financial Highlights 

Total revenue for the year ended December 31, 2024, was $919.7 million, compared to total revenue of $776.1 million for the prior year, an increase of 18.5% driven by acquisitions and organic growth during the past year. Revenue was negatively impacted by a $56.6 million revenue deferral at Circle Medical and a $24.5 million revenue reduction at CRH resulting from the CHC cyberattack. Excluding such impacts, the Company was on track to achieve revenue of $1.0 billion for 2024, an increase of 28.9% compared to 2023.

Free Cash Flow Attributable to Shareholders ("FCFA2S")(1) was $49.3 million for 2024, an increase of 16.3%, as compared to FCFA2S of $42.4 million for 2023. This figure was impacted by higher than expected capital expenditures in Q4 and would otherwise have exceeded $50 million for the year.

Adjusted Gross Profit(1) was $363.0 million in 2024, a decrease of 2.5% as compared to Adjusted Gross Profit of $372.3 million in 2023. Excluding the impact from the Circle Medical and CRH matters, the Company was on track to achieve Adjusted Gross Profit of $443.4 million for 2024, reflecting an increase of 19% compared to 2023.

Adjusted Gross Margin(1) percentage was 39.5% in 2024, as compared to Adjusted Gross Margin percentage of 48.0% in 2023. Excluding the impact from the Circle Medical and CRH matters, the Company was on track to achieve Adjusted Gross Margin for 2024 of 44.3%.

Adjusted EBITDA(1) was $46.7 million, compared to Adjusted EBITDA of $113.4 million for 2023.  Excluding the impact from the Circle Medical and CRH matters, the Company was on track to achieve Adjusted EBITDA of $127 million for 2024, an increase of 12.0% compared to the prior year.

Adjusted EBITDA to WELL shareholders(1) was $39.8 million in 2024, a decrease of 54.9% as compared to Adjusted EBITDA to WELL shareholders of $88.2 million in 2023. Excluding the impacts from the Circle Medical and CRH matters noted above, the Company was on track to achieve Adjusted EBITDA to WELL shareholders of $95.8 million in 2024.

Adjusted Net Income(1) was $8.0 million, or $0.03 per share in 2024, as compared to Adjusted Net Income of $52.8 million, or $0.22 per share in 2023. Excluding the impacts from the Circle Medical and CRH matters, the Company was on track to achieve Adjusted Net Income of $49.1 million in 2024.

Net Income was $29.1 million or $0.13 per share(2) in 2024, an increase of 74.9% as compared to Net Income of $16.6 million or $0.00 per share in 2023. Excluding the impact from the Circle Medical and CRH matters noted above, the Company was on track to achieve Net Income of $89.8 million in 2024.

Segmented Results (excluding inter-segment revenue)

Canadian Patient Services revenue was $319.1 million in 2024, an increase of 38.5% as compared to $230.4 million in 2023. Canadian Patient Services revenue was $88.8 million in Q4-2024, an increase of 31.4% as compared to $67.6 million in Q4-2023. 

Canadian Patient Services Adjusted EBITDA(1) was $40.7 million in 2024, an increase of 23.0%, as compared to $33.1 million in 2023. Adjusted EBITDA for Canadian Patient Services in Q4-2024 was $10.7 million, an increase of 44.6% as compared to Q4-2023.

US Patient and Provider Services revenue was $532.2 million in 2024, an increase of 11.6% as compared to US Patient Services revenue of $476.9 million in 2023. US Patient Services revenue was $125.6 million in Q4-2024, a decrease of 12.5% as compared to US Patient Services revenue of $143.5 million in Q4-2023. Excluding the impact from the Circle Medical and CRH matters noted above, the Company was on track to achieve quarterly revenue of $165.1 million for Q4-2024, an increase of 15.0% compared to Q4-2023.

US Patient and Provider Services Adjusted EBITDA was $11.2 million in 2024, as compared to $87.0 million in 2023. Adjusted EBITDA for US Patient Services in Q4-2024 was negative $13.1 million, a decrease as compared to $25.3 million in Q4-2023. Excluding the impact of the Circle Medical and CRH matters noted above, the Company was on track to achieve Adjusted EBITDA for US Patient Services of $91.6 million in 2024, an increase of 5.3% as compared to 2023 and Q4-2024 Adjusted EBITDA of $29.9 million, an increase of 18.2% as compared to Q4-2023.

SaaS and Technology revenue was $68.3 million in 2024, a decrease of 0.7% as compared to SaaS and Technology revenue of $68.8 million in 2023.  The decrease in SaaS and Technology revenue is attributable to the divestment of Intrahealth in Q1-2024.  SaaS and Technology revenue was $20.5 million in Q4-2024, an increase of 1.5% as compared to SaaS and Technology revenue of $20.2 million in Q4-2023. Excluding Intrahealth, SaaS and Technology revenue grew by $9.6 million or 16.6% in 2024 and by $3.2 million or 19% in Q4-2024.

SaaS and Technology Adjusted EBITDA was $15.6 million in 2024, an increase of 21.3%, as compared to $12.9 million in 2023. Adjusted EBITDA for SaaS and Technology in Q4-2024 was $4.0 million, an increase of 8.6% as compared to Q4-2023.

Annual 2024 Patient Visit Metrics

 

2024

 

2023

Y/YGrowth

OrganicGrowth

Canada Patient Visits

3,125,011

2,312,799

35 %

32 %

US Patient Visits

2,576,557