NeueHealth(NEUE)

Search documents
NeueHealth(NEUE) - 2024 Q3 - Earnings Call Transcript
2024-11-10 09:37
Financial Data and Key Metrics Changes - NeueHealth reported consolidated revenue of $232.9 million for Q3 2024, with an adjusted EBITDA of $9.4 million, marking the company's best quarterly financial performance to date [16][6] - Year-to-date adjusted EBITDA reached $17 million, aligning with the full-year guidance range of $15 million to $25 million [7][23] - The company served approximately 509,000 consumers in total, exceeding the full-year guidance range and representing over 30% growth compared to Q3 2023 [17][7] Business Line Data and Key Metrics Changes - In the NeueCare segment, revenue was $83.9 million with an operating income of $16.4 million, serving approximately 347,000 value-based consumers [18][19] - The NeueSolutions segment generated $152 million in revenue, with an operating loss of $5.8 million, which included payments to the NeueCare segment [19][20] - The ACO Reach business served approximately 43,000 Medicare beneficiaries, focusing on care management and patient engagement initiatives [21] Market Data and Key Metrics Changes - The company is expanding its footprint in Central Florida, increasing the number of consumers served across owned and affiliated clinics [10] - There is a focus on growing the Medicaid population served in partnership with federally qualified health centers [9] Company Strategy and Development Direction - The company aims to diversify and grow its consumer base across all product categories, including the ACA Marketplace, Medicare, and Medicaid [8] - Plans include driving capital-efficient growth in existing and new markets by leveraging relationships with payer partners [9] - The acquisition of Centrum Health aims to simplify corporate structure and enhance the value-driven consumer-centric care model [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued success and growth in 2025, supported by strong relationships with payer partners and a diversified consumer base [8][28] - The company is well-positioned to advance its model and drive strategic growth, with expectations to finish the year strong [27][29] Other Important Information - The wind down of the ACA insurance business is proceeding as planned, with approximately $123 million in cash available for remaining medical costs [22] - Total cash and investments as of September 30, 2024, were $242.3 million, with nonregulated cash at $119.2 million [23] Q&A Session Summary Question: What is the outlook for the ACA insurance business? - The wind down is continuing as planned, with capital retrieval from discontinued entities ongoing [22] Question: How does the company plan to grow in new markets? - The company will leverage strong relationships with payer partners to explore growth opportunities [9][28] Question: What are the expectations for consumer growth in 2024? - The company anticipates serving between 475,000 and 500,000 consumers across both segments, aiming for the high end of this range [24]
NeueHealth(NEUE) - 2024 Q3 - Quarterly Report
2024-11-07 21:25
Consumer Base and Services - As of September 30, 2024, NeueCare served approximately 404,000 consumers, including 347,000 value-based consumers and 57,000 fee-for-service consumers[198] - NeueSolutions had approximately 43,000 value-based care consumers attributed to its REACH ACOs and 119,000 enablement services lives as of September 30, 2024[199] - Year-over-year, value-based care consumers increased by approximately 35,000, driven by a rise of 55,000 through third-party payor relationships[208] - Enablement services lives grew to approximately 119,000, up from 31,000 in the previous year, indicating a substantial expansion in this segment[207] - NeueHealth aims to diversify and grow its consumer base across all product categories, including ACA Marketplace, Medicare, and Medicaid[202] Financial Performance - The company reported an Adjusted EBITDA of $9.396 million for the three months ended September 30, 2024, compared to $3.431 million for the same period in 2023, marking a significant increase[210] - As of September 30, 2024, the net loss was $40.365 million, a significant improvement from a net loss of $547.148 million for the same period in 2023[214] - Total revenue decreased by $36.5 million, or 13.5%, for the three months ended September 30, 2024, and $163.9 million, or 18.9%, for the nine months ended September 30, 2024, compared to the same periods in 2023[219] - ACO REACH revenue decreased by $50.6 million and $205.8 million for the three and nine months ended September 30, 2024, respectively, primarily due to a decrease of approximately 20,000 beneficiaries aligned to the REACH ACOs[219] - Capitated revenue increased by $11.0 million, or 18.2%, for the three months ended September 30, 2024, and $37.1 million, or 23.2%, for the nine months ended September 30, 2024, driven by increased membership through third-party payor contracts[230] Costs and Expenses - Medical costs decreased by $43.7 million, or 19.3%, for the three months ended September 30, 2024, and $174.5 million, or 23.8%, for the nine months ended September 30, 2024, primarily due to a decrease in beneficiaries aligned to the REACH ACOs[220] - Operating costs decreased by $8.5 million, or 11.7%, for the three months ended September 30, 2024, and $20.6 million, or 9.3%, for the nine months ended September 30, 2024, primarily due to a reduction in professional fees[221] - The operating cost ratio increased to 27.5% and 28.6% for the three and nine months ended September 30, 2024, respectively, reflecting a 60 and 310 basis points increase compared to the same periods in 2023[222] - Interest expense decreased by $4.6 million and $14.5 million for the three and nine months ended September 30, 2024, respectively, due to the payoff of the 2021 Credit Agreement in January 2024[225] - Loss from discontinued operations decreased by $53.5 million and $197.7 million for the three and nine months ended September 30, 2024, primarily due to the sale of the California Medicare Advantage business[229] Asset Management and Financing - The company recognized $11.4 million in impairments of intangible assets for the nine months ended September 30, 2024, related to classifying AMD as held-for-sale[223] - The company declared $28.2 million in dividends from regulated insurance entities during the nine months ended September 30, 2024, compared to no dividends in the same period of 2023[249] - As of September 30, 2024, the company was out of compliance with minimum risk-based capital and surplus levels for certain regulated insurance entities[250] - The company had $86.4 million in long-term borrowings under the Amended 2023 Credit Agreement as of September 30, 2024[260] - The Company has a term loan Tranche 2 of up to $25,000,000 available from November 10 to December 31, 2024, contingent on achieving specific funding milestones[263] Cash Flow and Investments - As of September 30, 2024, the Company had $226.4 million in cash and cash equivalents and $15.8 million in short-term investments[273] - The net cash used in operating activities for the nine months ended September 30, 2024, was $(98,823) thousand, a decrease of $2.3 billion compared to the same period in 2023[278] - Net cash provided by investing activities for the nine months ended September 30, 2024, was $189,230 thousand, a decrease of $956.2 million compared to the prior year[279] - The Company had net cash used in financing activities of $(239,274) thousand for the nine months ended September 30, 2024, an increase of $280.3 million compared to the same period in 2023[280] - As of September 30, 2024, the Company had letters of credit of $16.5 million and surety bonds of $19.7 million, with $33.7 million of cash and cash equivalents restricted as collateral[269] Shareholder Equity - The Centrum Promissory Note issued on October 29, 2024, has a principal of $64.0 million, due on October 29, 2028, with a cash interest rate of 6% per annum[270] - The Company issued 750,000 shares of Series A Preferred Stock for $750.0 million and 175,000 shares of Series B Preferred Stock for $175.0 million in previous financing rounds[271] - As of September 30, 2024, the Company had non-regulated cash and cash equivalents of $110.3 million, with $33.7 million restricted as collateral[274]
NeueHealth(NEUE) - 2024 Q3 - Quarterly Results
2024-11-07 11:48
Financial Performance - NeueHealth reported revenue of $232.933 million for Q3 2024, a decrease of 13.5% compared to $269.399 million in Q3 2023[4] - Adjusted EBITDA for Q3 2024 was $9.396 million, up from $3.431 million in Q3 2023, marking the third consecutive quarter of positive Adjusted EBITDA[4] - Total revenue for the nine months ended September 30, 2024, was $704,019, down 19% from $867,931 in the same period of 2023[13] - ACO REACH revenue for the three months ended September 30, 2024, was $149,477, a decrease of 25.2% from $200,044 in the same period of 2023[17] - Total segment revenue for the nine months ended September 30, 2024, was $478,014, down 29.6% from $678,521 in the prior year[17] Consumer and Service Growth - The number of value-based consumers served increased to 390,000 in September 2024, up from 355,000 in September 2023, representing a growth of 9.86%[3] - Enablement services lives rose significantly to 119,000 in September 2024, compared to 31,000 in September 2023, indicating a growth of 283.87%[3] Revenue Projections and Guidance - For the full year 2024, NeueHealth expects revenue to be approximately $950 million, with NeueCare revenue projected at $320 million and NeueSolutions revenue at $640 million[5] - The company reaffirmed its Adjusted EBITDA guidance for 2024, expecting it to be between $15 million and $25 million[5] Assets and Liabilities - Total assets as of September 30, 2024, were reported at $696.783 million, a decrease from $1.225 billion as of December 31, 2023[12] - Total liabilities decreased to $1.009 billion as of September 30, 2024, down from $1.480 billion at the end of 2023[12] Cash Flow and Operating Activities - Cash and cash equivalents increased to $109.839 million in Q3 2024, compared to $87.299 million at the end of 2023[12] - Cash and cash equivalents at the end of the period were $226,413, down from $723,417 at the end of September 2023[15] - Net cash used in operating activities for the nine months ended September 30, 2024, was $(98,823), compared to $(2,395,319) in the same period of 2023[15] Operating Performance - Operating loss for Q3 2024 was $(17,342), a significant improvement compared to $(462,775) in Q3 2023[13] - Operating income for NeueCare in Q3 2024 was $16,430, compared to an operating loss of $(390,761) in Q3 2023[16] - Operating loss for the three months ended September 30, 2024, was $(5,832), an improvement from $(29,355) in the same period of 2023[17] Medical Costs - Medical costs for Q3 2024 were $182,693, a decrease of 19.3% from $226,438 in Q3 2023[13] - Medical costs for the three months ended September 30, 2024, were $153,840, a decrease from $204,017 in the same period of 2023[17] Cost Management - Total operating expenses for the nine months ended September 30, 2024, were $782,012, down from $1,398,992 in the same period of 2023[13] - Total operating expenses for the nine months ended September 30, 2024, were $486,381, down from $706,389 in the prior year[17] - The company plans to continue focusing on improving operational efficiency and reducing costs in future quarters[19] Losses - Net loss attributable to common shareholders for the nine months ended September 30, 2024, was $(170,383), compared to $(958,267) in the same period of 2023[13] - The company reported a net loss of $(40,365) for the three months ended September 30, 2024, compared to $(547,148) in the same period of 2023[21] Cost Ratios - The Operating Cost Ratio for the three months ended September 30, 2024, was 27.5%, up from 26.9% in the same period of 2023[22] - Adjusted Operating Cost Ratio for the three months ended September 30, 2024, was 18.2%, slightly down from 18.6% in the same period of 2023[22]
NeueHealth (NEUE) Upgraded to Buy: What Does It Mean for the Stock?
ZACKS· 2024-09-19 17:01
NeueHealth (NEUE) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #2 (Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices. A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years. Since a changing ear ...
NeueHealth(NEUE) - 2024 Q2 - Quarterly Report
2024-08-12 23:17
[FORWARD-LOOKING STATEMENTS](index=4&type=section&id=FORWARD-LOOKING%20STATEMENTS) The report contains forward-looking statements regarding future operations, business plans, strategies, and financial outlook, which are subject to various risks, uncertainties, and assumptions - The report contains forward-looking statements regarding future operations, business plans, strategies, and financial outlook, which are subject to various risks, uncertainties, and assumptions[5](index=5&type=chunk) - Key factors that could materially affect forward-looking statements include the company's ability to continue as a going concern, comply with credit facility terms, receive proceeds from asset sales, obtain financing, manage business wind-downs, and adapt to market and regulatory changes[5](index=5&type=chunk) [PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including balance sheets, income statements, comprehensive income statements, statements of changes in equity, and cash flow statements, along with detailed notes explaining the company's organization, significant accounting policies, and specific financial line items [Condensed Consolidated Balance Sheets (Unaudited)](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2024 | December 31, 2023 | |:---|:---|:---| | Total assets | $897,265 | $1,225,480 | | Total liabilities | $1,179,803 | $1,480,098 | | Total shareholders' equity (deficit) | $(1,306,822) | $(1,263,943) | - Total assets decreased by **$328.2 million**, primarily due to a reduction in current assets of discontinued operations[7](index=7&type=chunk)[8](index=8&type=chunk) - Total liabilities decreased by **$300.3 million**, largely driven by a significant reduction in short-term borrowings and current liabilities of discontinued operations[7](index=7&type=chunk)[8](index=8&type=chunk) [Condensed Consolidated Statements of Income (Loss) (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(Loss)%20(Unaudited)) Condensed Consolidated Statements of Income (Loss) (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Total revenue | $225,991 | $297,982 | $471,086 | $598,532 | | Operating loss | $(37,549) | $(23,414) | $(60,651) | $(68,286) | | Net Loss | $(57,698) | $(88,627) | $(61,875) | $(258,088) | | Net loss attributable to NeueHealth, Inc. common shareholders | $(71,390) | $(125,005) | $(99,908) | $(311,910) | | Basic and diluted loss per share | $(8.65) | $(15.70) | $(12.23) | $(39.35) | - Total revenue decreased by **24.2%** for the three months ended June 30, 2024, and **21.3%** for the six months ended June 30, 2024, primarily due to a decrease in ACO REACH revenue[10](index=10&type=chunk) - Net loss attributable to common shareholders improved significantly, decreasing from **$(125,005) thousand** to **$(71,390) thousand** for the three months ended June 30, 2024, and from **$(311,910) thousand** to **$(99,908) thousand** for the six months ended June 30, 2024[10](index=10&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)%20(Unaudited)) Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Net loss | $(57,698) | $(88,627) | $(61,875) | $(258,088) | | Other comprehensive income | $104 | $1,337 | $122 | $3,530 | | Comprehensive loss | $(57,594) | $(87,290) | $(61,753) | $(254,558) | | Comprehensive loss attributable to NeueHealth, Inc. common shareholders | $(58,526) | $(111,495) | $(74,422) | $(284,313) | - Comprehensive loss attributable to common shareholders significantly improved, decreasing from **$(111,495) thousand** to **$(58,526) thousand** for the three months ended June 30, 2024, and from **$(284,313) thousand** to **$(74,422) thousand** for the six months ended June 30, 2024[12](index=12&type=chunk) [Condensed Consolidated Statements of Changes in Redeemable Preferred Stock and Shareholders' Equity (Deficit) (Unaudited)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Redeemable%20Preferred%20Stock%20and%20Shareholders'%20Equity%20(Deficit)%20(Unaudited)) Changes in Shareholders' Equity (Deficit) (in thousands) | Metric | Balance at January 1, 2024 | Net Loss | Share-based Compensation | Equity Distributions | Other Comprehensive Loss | Balance at June 30, 2024 | |:---|:---|:---|:---|:---|:---|:---|\ | Total shareholders' equity (deficit) | $(1,263,943) | $(74,544) | $37,406 | $(7,020) | $122 | $(1,306,822) | - The accumulated deficit increased from **$(4,307,849) thousand** at January 1, 2024, to **$(4,382,393) thousand** at June 30, 2024, reflecting the net losses incurred during the period[14](index=14&type=chunk) - Additional paid-in capital increased by **$31,543 thousand** during the six months ended June 30, 2024, primarily due to share-based compensation and equity-classified warrants issued[14](index=14&type=chunk) [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|\ | Net cash used in operating activities | $(77,148) | $(724,026) | | Net cash provided by investing activities | $189,281 | $157,127 | | Net cash used in financing activities | $(225,955) | $(4,950) | | Net (decrease)/increase in cash and cash equivalents | $(113,822) | $(571,849) | | Cash and cash equivalents at end of period | $261,458 | $1,360,441 | - Net cash used in operating activities significantly decreased by **$646.9 million** for the six months ended June 30, 2024, compared to the same period in 2023, primarily due to being further into the run-out of Commercial operations[18](index=18&type=chunk)[221](index=221&type=chunk) - Net cash provided by investing activities increased by **$32.2 million**, driven by net proceeds from the sale of the California Medicare Advantage business[18](index=18&type=chunk)[222](index=222&type=chunk) - Net cash used in financing activities increased by **$221.0 million**, mainly due to the payoff of short-term debt using proceeds from the California Medicare Advantage business sale, partially offset by new long-term borrowings[18](index=18&type=chunk)[223](index=223&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION](index=11&type=section&id=NOTE%201.%20ORGANIZATION%20AND%20BASIS%20OF%20PRESENTATION) - NeueHealth operates two market-facing segments: NeueCare (value-driven care delivery) and NeueSolutions (provider enablement)[21](index=21&type=chunk) - The company entered into an amendment to the 2023 Credit Agreement, increasing available borrowing by **$30.0 million**, and a new Hercules Credit Agreement for up to **$150.0 million** in term loans[23](index=23&type=chunk)[24](index=24&type=chunk) - During Q2 2024, AssociatesMD Medical Group, Inc. (AMD) was classified as held for sale. The California Medicare Advantage business was sold effective January 1, 2024, and the 2021 Credit Agreement was terminated with a **$30.3 million** gain on troubled debt restructuring[25](index=25&type=chunk)[27](index=27&type=chunk)[29](index=29&type=chunk) - The company has a history of operating losses and negative operating cash flows, leading to substantial doubt about its ability to continue as a going concern, as existing cash and investments are not believed to be sufficient for the next twelve months[31](index=31&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) [NOTE 2. RESTRUCTURING CHARGES](index=13&type=section&id=NOTE%202.%20RESTRUCTURING%20CHARGES) - Restructuring charges for continuing operations decreased significantly from **$1,285 thousand** in Q2 2023 to **$239 thousand** in Q2 2024, and from **$1,586 thousand** to **$181 thousand** for the six months ended June 30, 2024[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk) - The restructuring accrual for employee termination benefits decreased from **$8,389 thousand** at January 1, 2024, to **$3,164 thousand** at June 30, 2024, after net charges of **$181 thousand** and cash payments of **$5,406 thousand**[41](index=41&type=chunk) [NOTE 3. INTANGIBLE ASSETS](index=15&type=section&id=NOTE%203.%20INTANGIBLE%20ASSETS) Definite-Lived Intangible Assets (in thousands) | Metric | June 30, 2024 (Gross Carrying Amount) | June 30, 2024 (Accumulated Amortization) | December 31, 2023 (Gross Carrying Amount) | December 31, 2023 (Accumulated Amortization) | |:---|:---|:---|:---|:---|\ | Customer relationships | $68,770 | $25,257 | $80,021 | $26,144 | | Trade names | $40,900 | $8,373 | $48,361 | $9,000 | | Total | $109,670 | $33,630 | $128,382 | $35,144 | - An impairment of **$11.4 million** to definite-lived intangible assets was recognized for the three and six months ended June 30, 2024, due to classifying AMD as held-for-sale[43](index=43&type=chunk) Estimated Amortization Expense (in thousands) | Year | Amount | |:---|:---|\ | 2024 (July-December) | $4,976 | | 2025 | $9,952 | | 2026 | $9,952 | | 2027 | $9,952 | | 2028 | $8,673 | | 2029 | $8,673 | [NOTE 4. MEDICAL COSTS PAYABLE](index=16&type=section&id=NOTE%204.%20MEDICAL%20COSTS%20PAYABLE) Medical Costs Payable (in thousands) | Metric | June 30, 2024 | December 31, 2023 | |:---|:---|:---|\ | Medical costs payable - January 1 | $157,903 | $116,021 | | Total incurred | $374,555 | $505,336 | | Total paid | $395,414 | $441,502 | | Medical costs payable - June 30 | $137,044 | $179,855 | - Medical costs payable decreased by **$20.8 million** from December 31, 2023, to June 30, 2024, primarily due to a reduction in incurred but not reported (IBNR) claims[46](index=46&type=chunk)[47](index=47&type=chunk) - Payables due to CMS, primarily for out-of-network claims related to the ACO REACH Care Partner Babylon's bankruptcy, amounted to **$32,706 thousand** as of June 30, 2024[47](index=47&type=chunk) [NOTE 5. BORROWINGS AND COMMON STOCK WARRANTS](index=16&type=section&id=NOTE%205.%20BORROWINGS%20AND%20COMMON%20STOCK%20WARRANTS) - The 2021 Credit Agreement was terminated on January 2, 2024, resulting in no outstanding borrowings and a **$30.3 million** gain on troubled debt restructuring[50](index=50&type=chunk)[51](index=51&type=chunk) - The 2023 Credit Agreement was amended to increase commitments by **$30.0 million** and extend the maturity date to August 31, 2028. As of June 30, 2024, **$86.4 million** was borrowed under this agreement with a **16.14%** effective interest rate, and an additional **$10.0 million** is available[54](index=54&type=chunk)[57](index=57&type=chunk) - A new Hercules Credit Agreement was entered into on June 21, 2024, providing up to **$150.0 million** in term loans, maturing on June 1, 2028. **$30.0 million** was drawn at closing, with an effective interest rate of **17.03%**. Access to remaining tranches is subject to funding milestones[58](index=58&type=chunk)[59](index=59&type=chunk)[61](index=61&type=chunk) - Warrant liabilities increased from **$13.971 million** at January 1, 2024, to **$21.792 million** at June 30, 2024, due to newly executed warrantholders agreements and antidilutive issuances, partially offset by changes in fair value[70](index=70&type=chunk)[71](index=71&type=chunk) [NOTE 6. SHARE-BASED COMPENSATION](index=20&type=section&id=NOTE%206.%20SHARE-BASED%20COMPENSATION) - Share-based compensation expense was **$39.9 million** for the six months ended June 30, 2024, down from **$49.1 million** in the prior year[74](index=74&type=chunk) Share-Based Compensation Expense (in thousands) | Award Type | Six Months Ended June 30, 2024 | |:---|:---|\ | Stock Options | $13,200 | | Restricted Stock Units (RSUs) | $11,600 | | Performance-based Restricted Stock Units (PSUs) | $12,600 | | Liability Classified Share-based Award | $2,500 | | Total | $39,900 | - Unrecognized compensation expense for stock options was **$14.5 million** (**0.6 years** weighted-average period) and for RSUs was **$24.3 million** (**1.6 years** weighted-average period) as of June 30, 2024[75](index=75&type=chunk)[77](index=77&type=chunk) - A new liability-classified share-based award was granted in May 2024, with a recognized expense of **$2.5 million** for the six months ended June 30, 2024, and an estimated unrecognized expense of **$4.9 million**[79](index=79&type=chunk)[81](index=81&type=chunk)[83](index=83&type=chunk) [NOTE 7. REDEEMABLE CONVERTIBLE PREFERRED STOCK](index=23&type=section&id=NOTE%207.%20REDEEMABLE%20CONVERTIBLE%20PREFERRED%20STOCK) - Series A Preferred Stock (**750,000 shares**, **$750.0 million** aggregate purchase price) accrues dividends at **5.0%** per annum, with accrued compounded dividends of **$98.7 million** as of June 30, 2024[85](index=85&type=chunk)[86](index=86&type=chunk) - Series B Preferred Stock (**175,000 shares**, **$175.0 million** aggregate purchase price) also accrues dividends at **5.0%** per annum, with accrued compounded dividends of **$15.5 million** as of June 30, 2024[91](index=91&type=chunk)[92](index=92&type=chunk) - Both Series A and B Preferred Stock rank senior to common stock regarding dividend and liquidation rights, are convertible into common stock, and are redeemable by the Company under certain conditions after specific dates (Jan 2027 for Series A, Oct 2027 for Series B)[86](index=86&type=chunk)[87](index=87&type=chunk)[90](index=90&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk)[96](index=96&type=chunk) [NOTE 8. NET LOSS PER SHARE](index=25&type=section&id=NOTE%208.%20NET%20LOSS%20PER%20SHARE) Basic and Diluted Net Loss Per Share (in thousands, except per share amounts) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Net loss attributable to NeueHealth, Inc. common shareholders | $(71,390) | $(125,005) | $(99,908) | $(311,910) | | Weighted-average common shares outstanding | 8,253 | 7,962 | 8,166 | 7,928 | | Basic and diluted loss per share | $(8.65) | $(15.70) | $(12.23) | $(39.35) | Potentially Dilutive Securities Excluded from EPS (in thousands) | Security Type | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|\ | Redeemable convertible preferred stock | 5,241 | 4,081 | | Issued and outstanding common stock warrants | 2,842 | — | | Stock options | 534 | 720 | | Restricted stock units | 3,045 | 1,108 | | Total | 11,662 | 5,909 | [NOTE 9. COMMITMENTS AND CONTINGENCIES](index=26&type=section&id=NOTE%209.%20COMMITMENTS%20AND%20CONTINGENCIES) - The company is involved in a putative securities class action lawsuit filed in January 2022, alleging materially false and misleading statements, which it is vigorously defending[101](index=101&type=chunk) - As of June 30, 2024, the amount or range of reasonably possible losses from legal proceedings cannot be estimated, and no accrual has been made[102](index=102&type=chunk) - Other commitments include **$16.5 million** in letters of credit and **$19.7 million** in surety bonds, with **$52.0 million** in cash and cash equivalents and **$8.7 million** in short-term investments restricted as collateral[104](index=104&type=chunk)[105](index=105&type=chunk) [NOTE 10. SEGMENTS AND GEOGRAPHIC INFORMATION](index=27&type=section&id=NOTE%2010.%20SEGMENTS%20AND%20GEOGRAPHIC%20INFORMATION) - The company operates two reportable segments: NeueCare (value-driven care delivery with **74 owned clinics** and **~372,000 consumers**) and NeueSolutions (provider enablement with **~44,000 REACH ACO members** and **~113,000 enablement services lives**)[107](index=107&type=chunk)[108](index=108&type=chunk) Segment Revenue and Operating Income (Loss) (in thousands) | Segment | Three Months Ended June 30, 2024 (Revenue) | Three Months Ended June 30, 2024 (Operating Income (Loss)) | Six Months Ended June 30, 2024 (Revenue) | Six Months Ended June 30, 2024 (Operating Income (Loss)) | |:---|:---|:---|:---|:---|\ | NeueCare | $76,985 | $(5,902) | $150,608 | $3,910 | | NeueSolutions | $152,075 | $397 | $325,971 | $(2,535) | | Consolidated | $225,991 | $(37,549) | $471,086 | $(60,651) | - NeueCare's capitated revenue increased by **28.6%** for Q2 2024 and **26.3%** for the six months ended June 30, 2024, driven by increased membership through third-party payor contracts[193](index=193&type=chunk) - NeueSolutions's ACO REACH revenue decreased by **36.8%** for Q2 2024 and **32.5%** for the six months ended June 30, 2024, due to a decrease of approximately **24,000 beneficiaries** aligned to its REACH ACOs[198](index=198&type=chunk) [NOTE 11. INCOME TAXES](index=29&type=section&id=NOTE%2011.%20INCOME%20TAXES) - Income tax was a benefit of **$0.2 million** for the three months ended June 30, 2024, compared to an expense of **$0.9 million** in the prior year. For the six months, it was an expense of **$0.5 million** in 2024 versus **$0.4 million** in 2023[115](index=115&type=chunk) - The tax impact varies from the federal statutory rate of **21.0%** due to state income taxes, changes in valuation allowance for deferred tax assets, and permanent differences[115](index=115&type=chunk) - A valuation allowance has been recorded for deferred tax assets due to cumulative losses, limiting the ability to consider subjective evidence for future earnings[116](index=116&type=chunk) [NOTE 12. REDEEMABLE NONCONTROLLING INTEREST](index=30&type=section&id=NOTE%2012.%20REDEEMABLE%20NONCONTROLLING%20INTEREST) Redeemable Noncontrolling Interest Activity (in thousands) | Metric | 2024 (Six Months Ended June 30) | 2023 (Six Months Ended June 30) | |:---|:---|:---|\ | Balance at January 1 | $88,908 | $219,758 | | Earnings attributable to noncontrolling interest | $3,700 | $4,560 | | Distribution to noncontrolling interest holders | $2,290 | $(4,952) | | Measurement adjustment | $8,973 | $25,195 | | Balance at June 30 | $103,867 | $244,561 | - Redeemable noncontrolling interests increased from **$88,908 thousand** at January 1, 2024, to **$103,867 thousand** at June 30, 2024[118](index=118&type=chunk) [NOTE 13. ACO REACH](index=30&type=section&id=NOTE%2013.%20ACO%20REACH) - The company participates in the CMS ACO REACH Model, assuming full risk for the total cost of care for aligned beneficiaries through three REACH ACOs[119](index=119&type=chunk) - Key financial components include Performance Year Benchmark, Risk-Sharing Arrangements, Financial Reconciliation, and Risk-Mitigation Options (e.g., stop-loss arrangements)[119](index=119&type=chunk) ACO REACH Financial Impacts (in thousands) | Metric | June 30, 2024 | December 31, 2023 | |:---|:---|:---|\ | ACO REACH performance year receivable | $425,517 | $115,878 | | ACO REACH performance year obligation | $325,599 | — | ACO REACH Amortization and Revenue (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Amortization of ACO REACH performance year receivable | $166,099 | $249,449 | $341,559 | $424,972 | | Amortization of ACO REACH performance year obligation | $149,047 | $234,893 | $325,599 | $474,700 | | ACO REACH revenue | $149,802 | $236,994 | $321,613 | $476,801 | [NOTE 14. DECONSOLIDATION OF BRIGHT HEALTHCARE INSURANCE COMPANY OF TEXAS](index=31&type=section&id=NOTE%2014.%20DECONSOLIDATION%20OF%20BRIGHT%20HEALTHCARE%20INSURANCE%20COMPANY%20OF%20TEXAS) - BHIC-Texas was placed into liquidation on November 29, 2023, leading to its deconsolidation from the company's financial statements[125](index=125&type=chunk)[126](index=126&type=chunk) - Upon deconsolidation, a **$124.0 million** risk share payable to the deconsolidated entity was recorded, representing accrued losses from a risk share contract[127](index=127&type=chunk) - The company recorded a full valuation allowance on its **$91.5 million** investment in BHIC-Texas due to uncertainties in collecting the risk share receivable[128](index=128&type=chunk) [NOTE 15. HELD-FOR-SALE OPERATIONS](index=32&type=section&id=NOTE%2015.%20HELD-FOR-SALE%20OPERATIONS) - AssociatesMD Medical Group, Inc. (AMD) was classified as held-for-sale during Q2 2024, with the sale expected to complete within the next twelve months[129](index=129&type=chunk) AMD Held-for-Sale Assets and Liabilities (in thousands) | Metric | June 30, 2024 | |:---|:---|\ | Current assets of held-for-sale operations | $8,158 | | Current liabilities of held-for-sale operations | $3,981 | AMD Operating Results (in thousands) | Metric | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | |:---|:---|:---|\ | Total revenue of held-for-sale operations | $5,500 | $12,137 | | Total operating expenses from held-for-sale operations | $22,171 | $30,431 | | Operating loss from held-for-sale operations | $(16,671) | $(18,294) | - An **$11.4 million** impairment of intangible assets was recognized due to the classification of AMD as held-for-sale, as its carrying value exceeded its estimated fair value[131](index=131&type=chunk) [NOTE 16. DISCONTINUED OPERATIONS](index=33&type=section&id=NOTE%2016.%20DISCONTINUED%20OPERATIONS) - Discontinued operations include the Bright HealthCare - Commercial segment (exited end of 2022) and the California Medicare Advantage business (sold effective January 1, 2024)[132](index=132&type=chunk)[133](index=133&type=chunk) Financial Results of Discontinued Operations (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Total revenue from discontinued operations | $(9,898) | $449,698 | $(8,545) | $927,123 | | Net loss from discontinued operations | $(18,439) | $(56,935) | $(28,304) | $(172,478) | - Net loss from discontinued operations decreased significantly by **$38.5 million** for Q2 2024 and **$144.2 million** for the six months ended June 30, 2024, primarily due to the sale of the California MA business and the advanced run-out of the Commercial business[192](index=192&type=chunk) Assets and Liabilities of Discontinued Operations (in thousands) | Metric | June 30, 2024 | December 31, 2023 | |:---|:---|:---|\ | Current assets of discontinued operations | $142,375 | $822,570 | | Current liabilities of discontinued operations | $343,985 | $699,758 | | Risk adjustment payable | $286,991 | $291,146 | - The sale of the California MA business for **$500.0 million** was consummated on January 1, 2024, with **$167.3 million** of the purchase price subject to contingencies and TNE adjustments, which have not been recorded as receivable due to conditions outside the company's control[144](index=144&type=chunk)[145](index=145&type=chunk)[147](index=147&type=chunk)[149](index=149&type=chunk) - The company's insurance subsidiaries are out of compliance with minimum capital levels for certain regulated entities as of June 30, 2024[160](index=160&type=chunk) [NOTE 17. SUBSEQUENT EVENTS](index=43&type=section&id=NOTE%2017.%20SUBSEQUENT%20EVENTS) - No events or transactions have occurred through the financial statement issuance date that require adjustment or disclosure[161](index=161&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=44&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition, results of operations, liquidity, and capital resources, highlighting key business updates, performance metrics, and a detailed analysis of revenue and expenses. It also addresses the company's going concern status and debt structure [Business Overview](index=44&type=section&id=Business%20Overview) - NeueHealth aims to transform healthcare by making high-quality, coordinated care accessible and affordable, operating through two continuing segments: NeueCare and NeueSolutions[164](index=164&type=chunk) - NeueCare is a value-driven care delivery business with **74 owned primary care clinics**, serving approximately **372,000 consumers** across ACA Marketplace, Medicare, and Medicaid[165](index=165&type=chunk) - NeueSolutions is a provider enablement business supporting **~44,000 value-based care consumers** attributed to REACH ACOs and **~113,000 enablement services lives**[166](index=166&type=chunk) - The Bright HealthCare - Commercial segment is included in discontinued operations, having exited the commercial health plan market at the end of 2022[166](index=166&type=chunk) [Business Update](index=44&type=section&id=Business%20Update) - NeueHealth delivered solid Q2 2024 results, strengthening its capital position with a new **$150.0 million** term loan facility from Hercules Capital[167](index=167&type=chunk) - The company continues to advance its value-driven, consumer-centric care model, focusing on strong relationships with consumers, payors, and providers[167](index=167&type=chunk)[170](index=170&type=chunk) - Strategic growth opportunities are being evaluated for 2025 and beyond, with a robust pipeline to expand payor and provider partnerships and consumer enrollment[168](index=168&type=chunk) - NeueSolutions is driving strong performance in its ACO REACH business through care management, patient engagement, and health equity initiatives[171](index=171&type=chunk) [Key Metrics and Non-GAAP Financial Measures](index=46&type=section&id=Key%20Metrics%20and%20Non-GAAP%20Financial%20Measures) Key Performance Metrics | Metric | As of June 30, 2024 | As of June 30, 2023 | |:---|:---|:---|\ | Value-Based Consumers served | 364,000 | 373,000 | | Enablement Services Lives | 113,000 | 31,000 | - Value-based care consumers decreased by approximately **9,000** year-over-year, driven by a decline of **~24,000 ACO REACH lives**, partially offset by an increase of **~15,000** through third-party payor relationships[175](index=175&type=chunk) - Enablement services lives increased significantly to **113,000**, reflecting the value provided to provider partner groups outside the NeueHealth owned network[177](index=177&type=chunk) Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Adjusted EBITDA | $3,962 | $7,797 | $7,618 | $2,480 | - Adjusted EBITDA decreased for the three months ended June 30, 2024, but increased significantly for the six months ended June 30, 2024, compared to the prior year, indicating improved core operating performance[178](index=178&type=chunk)[182](index=182&type=chunk) [Results of Operations](index=49&type=section&id=Results%20of%20Operations) Consolidated Revenue and Operating Expenses (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | |:---|:---|:---|:---|:---|\ | Total revenue | $225,991 | $297,982 | $471,086 | $598,532 | | Medical costs | $177,681 | $245,160 | $374,555 | $505,280 | | Operating costs | $70,217 | $70,280 | $137,039 | $149,798 | | Intangible assets impairment | $11,411 | $0 | $11,411 | $0 | | Operating loss | $(37,549) | $(23,414) | $(60,651) | $(68,286) | | Net loss attributable to common shareholders | $(71,390) | $(125,005) | $(99,908) | $(311,910) | - Total revenue decreased by **24.2%** (QoQ) and **21.3%** (YoY) for the three and six months ended June 30, 2024, respectively, primarily due to a decrease in ACO REACH revenue, partially offset by increased capitated revenue[186](index=186&type=chunk)[187](index=187&type=chunk) - Medical costs decreased by **27.5%** (QoQ) and **25.9%** (YoY) for the three and six months ended June 30, 2024, driven by fewer beneficiaries aligned to REACH ACOs[187](index=187&type=chunk) - Operating costs decreased by **0.1%** (QoQ) and **8.5%** (YoY) for the three and six months ended June 30, 2024, mainly due to reduced share-based compensation from employee reductions[188](index=188&type=chunk) - The operating cost ratio increased to **31.1%** (QoQ) and **29.1%** (YoY) due to revenue decline outpacing operating cost reductions[188](index=188&type=chunk) - Warrant income of **$2.2 million** (QoQ) and **$4.3 million** (YoY) was recognized for the three and six months ended June 30, 2024, due to new warrantholders agreements[190](index=190&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) - The company believes existing cash and investments are insufficient for the next twelve months, raising substantial doubt about its ability to continue as a going concern[200](index=200&type=chunk) - Management is implementing plans to drive positive operating cash flow and access additional liquidity, but these are subject to conditions outside the company's control, such as collecting contingent consideration from the California MA business sale and accessing further tranches of the Hercules Credit Agreement[200](index=200&type=chunk)[201](index=201&type=chunk) - Short-term cash uses include medical claims, risk adjustment obligations, and general administrative costs, while long-term needs include operating lease obligations and redeemable noncontrolling interests[203](index=203&type=chunk) - The company declared **$28.2 million** in dividends from regulated insurance entities to the parent company during the six months ended June 30, 2024[203](index=203&type=chunk) - As of June 30, 2024, the company had **$261.5 million** in cash and cash equivalents and **$16.3 million** in short-term investments across continuing and discontinued operations[219](index=219&type=chunk) - Non-regulated cash and cash equivalents were **$133.4 million**, with **$52.0 million** restricted as collateral. Regulated insurance entity cash and cash equivalents were **$128.0 million**[219](index=219&type=chunk) [Critical Accounting Policies and Estimates](index=58&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - There have been no material changes to the critical accounting policies and estimates since the 2023 Form 10-K[224](index=224&type=chunk) [Recently Adopted Accounting Pronouncements](index=58&type=section&id=Recently%20Adopted%20Accounting%20Pronouncements) - No recently issued or adopted accounting pronouncements had, or are expected to have, a material impact on the company's financial position, results of operations, or cash flows[37](index=37&type=chunk)[224](index=224&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=59&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This item is not applicable to the company for the reporting period - The company has no material market risk disclosures to report[225](index=225&type=chunk) [Item 4. Controls and Procedures](index=59&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were not effective as of June 30, 2024, due to a previously reported material weakness in internal control over financial reporting. Despite this, additional analyses confirm the fair presentation of financial statements - Disclosure controls and procedures were deemed not effective as of June 30, 2024, due to a material weakness in internal control over financial reporting related to the deployment of control activities[227](index=227&type=chunk)[228](index=228&type=chunk) - Despite the material weakness, management performed additional procedures and concluded that the condensed consolidated financial statements fairly present the financial position, results of operations, and cash flows[227](index=227&type=chunk) - The company is actively working to remediate the material weakness by refining control procedures and improving documentation[229](index=229&type=chunk)[230](index=230&type=chunk) [PART II. OTHER INFORMATION](index=60&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=60&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any litigation that, if determined adversely, would individually or collectively have a material adverse effect on its business, operating results, cash flows, or financial condition, beyond what is described in Note 9 - No legal proceedings are expected to have a material adverse effect on the company's business, operating results, cash flows, or financial condition[232](index=232&type=chunk) [Item 1A. Risk Factors](index=60&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's 2023 Form 10-K - No material changes to the risk factors disclosed in the 2023 Form 10-K[233](index=233&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=60&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) There were no unregistered sales of equity securities, use of proceeds, or issuer purchases of equity securities to report - No unregistered sales of equity securities, use of proceeds, or issuer purchases of equity securities[233](index=233&type=chunk) [Item 3. Defaults upon Senior Securities](index=60&type=section&id=Item%203.%20Defaults%20upon%20Senior%20Securities) There were no defaults upon senior securities to report - No defaults upon senior securities[233](index=233&type=chunk) [Item 4. Mine Safety Disclosures](index=60&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Mine safety disclosures are not applicable to the company[233](index=233&type=chunk) [Item 5. Other Information](index=60&type=section&id=Item%205.%20Other%20Information) There is no other information to report under this item - No other information to report[233](index=233&type=chunk) [Item 6. Exhibits](index=61&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Quarterly Report on Form 10-Q, including organizational documents, credit agreements, warrant agreements, incentive plans, and certifications - Exhibits include various corporate documents such as the Ninth Amended and Restated Certificate of Incorporation, Certificates of Designations for Series A and B Preferred Stock, and Fourth Amended and Restated Bylaws[235](index=235&type=chunk) - Key agreements filed as exhibits include the Loan and Security Agreement with Hercules Capital, Inc., Incremental Amendment No. 3, and the Second Amended and Restated 2021 Omnibus Incentive Plan[235](index=235&type=chunk) - Certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are also included[235](index=235&type=chunk)
NeueHealth(NEUE) - 2024 Q2 - Earnings Call Presentation
2024-08-07 14:40
| --- | --- | --- | --- | --- | |----------------------------------------------------------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | NeueHealth Second Quarter 2024 - Earnings Presentation | | | | | | Privileged & Confidential \| © 2024 August 7, 2024 | | | | | Disclaimer Statements made in this presentation that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements and should be evaluated as such. Forward- ...
NeueHealth(NEUE) - 2024 Q2 - Earnings Call Transcript
2024-08-07 13:21
Financial Data and Key Metrics Changes - NeueHealth reported consolidated revenue of $226 million for Q2 2024, with a gross margin of $48.3 million and adjusted EBITDA of $4 million, indicating a moderate increase in consumers served compared to Q1 [13][19] - The company reaffirmed its expectation for full-year adjusted EBITDA to be between $15 million and $25 million [19] Business Line Data and Key Metrics Changes - In the NeueCare segment, revenue was $77 million, with operating income of $8.5 million before a long-lived asset impairment expense, which resulted in an operating loss of $5.9 million for the quarter [14] - The NeueSolutions segment generated revenue of $152.1 million, with an operating loss of $397,000, while serving approximately 113,000 consumers, exceeding expectations [15][11] Market Data and Key Metrics Changes - The company served over 477,000 consumers across the ACA Marketplace, Medicare, and Medicaid in Q2 2024, reflecting its ability to manage diverse populations [6][13] - For 2024, NeueHealth expects to serve between 475,000 and 500,000 consumers across both segments, with specific targets for value-based consumers [19] Company Strategy and Development Direction - NeueHealth is focused on a value-driven, consumer-centric care model that emphasizes long-term relationships with consumers and partnerships with providers [5][6] - The company is evaluating strategic growth opportunities and has a robust pipeline for 2025 and beyond, aiming to expand payer and provider partnerships [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's model and its ability to drive better health outcomes, highlighting the importance of consumer engagement and personalized care [5][21] - The company is well-positioned for sustainable growth in 2024 and beyond, supported by a new term loan facility of up to $150 million [4][18] Other Important Information - The wind-down of the ACA insurance business is progressing as planned, with approximately $135 million in excess cash at the end of Q2 2024 [16] - As of June 30, 2024, the company had $277.8 million in total cash and investments, strengthening its balance sheet [17] Summary of Q&A Session - The Q&A session concluded without any recorded questions or answers, indicating a focus on the presentation of results rather than interactive discussion [22]
NeueHealth(NEUE) - 2024 Q2 - Quarterly Results
2024-08-07 10:46
Financial Performance - Revenue for Q2 2024 was $225.99 million, a decrease of 24.1% from $297.98 million in Q2 2023[2] - Net loss for Q2 2024 was $57.70 million, compared to a net loss of $88.63 million in Q2 2023, showing an improvement of 34.9%[2] - Adjusted EBITDA for Q2 2024 was $3.96 million, down from $7.80 million in Q2 2023[2] - Total revenue for the three months ended June 30, 2024, was $225,991, a decrease of 24.1% from $297,982 in the same period of 2023[10] - Operating loss for the six months ended June 30, 2024, was $(60,651), an improvement from $(68,286) in the same period of 2023[10] - Net loss attributable to common shareholders for the three months ended June 30, 2024, was $(71,390), compared to $(125,005) in the same period of 2023[10] - Total revenue for the six months ended June 30, 2024, was $943,477 thousand, compared to $1,476,801 thousand for the same period in 2023, reflecting a decline of about 36.0%[13] - The company reported a net loss of $(57,698) thousand for the three months ended June 30, 2024, compared to a net loss of $(88,627) thousand for the same period in 2023, indicating an improvement in financial performance[18] Revenue Projections - For 2024, revenue is expected to be approximately $950 million, with NeueCare revenue projected at $320 million and NeueSolutions revenue at $640 million[5] - Adjusted EBITDA guidance for 2024 is between $15 million and $25 million[5] Assets and Liabilities - Total assets as of June 30, 2024, were $897.27 million, down from $1.23 billion at the end of 2023[9] - Total liabilities decreased to $1.18 billion from $1.48 billion at the end of 2023[9] Consumer Metrics - Value-based consumers served decreased to 364,000 from 373,000 year-over-year[1] - Enablement services lives increased significantly to 113,000 from 31,000 year-over-year[1] - The company aims to reach the high end of its guidance range for consumers served by year-end 2024[3] Operating Expenses - Total operating expenses for the three months ended June 30, 2024, were $263,540, down from $321,396 in the same period of 2023, a reduction of 17.9%[10] - Total operating expenses for the six months ended June 30, 2024, were $328,506 thousand, compared to $476,257 thousand for the same period in 2023, reflecting a decrease of about 31.1%[13] Medical Costs - Medical costs for the three months ended June 30, 2024, were $177,681, a decrease from $245,160 in the same period of 2023, reflecting a reduction of 27.5%[10] - Medical costs for the six months ended June 30, 2024, totaled $319,323 thousand, down from $469,874 thousand in the same period of 2023, a decrease of approximately 32.1%[13] Segment Performance - Capitated revenue increased to $64,005 for the three months ended June 30, 2024, compared to $49,764 in the prior year, representing a growth of 28.6%[10] - Total segment revenue for NeueCare for the three months ended June 30, 2024, was $76,985, an increase from $66,068 in the same period of 2023, representing a growth of 16.4%[12] - NeueCare net income (loss) for the three months ended June 30, 2024, was $(5,902) thousand, compared to $11,031 thousand for the same period in 2023, representing a significant decline[21] - NeueCare Adjusted EBITDA for the six months ended June 30, 2024, was $28,222 thousand, an increase from $23,960 thousand in the same period of 2023, reflecting a growth of approximately 17.5%[21] Restructuring and Impairment - The company incurred restructuring charges of $239 for the three months ended June 30, 2024, down from $1,285 in the same period of 2023[10] - The company recognized $11.4 million in intangible asset impairment expense due to operations classified as held-for-sale for the six months ended June 30, 2024[22] - The restructuring and contract termination costs included severance costs and early lease termination payments as part of workforce reduction efforts[22] Cash Flow - Cash and cash equivalents at the end of the period were $261,458, down from $1,360,441 at the end of the same period in 2023[11] - The company reported a net cash used in operating activities of $(77,148) for the six months ended June 30, 2024, compared to $(724,026) in the same period of 2023[11] Adjusted EBITDA and Non-Cash Expenses - Adjusted EBITDA for the three months ended June 30, 2024, was $(566,000), a significant decrease from $2,996,000 in the prior year[22] - For the six months ended June 30, 2024, NeueSolutions reported an Adjusted EBITDA of $(2,250,000), down from $1,487,000 in the same period of 2023[22] - The non-cash compensation expense related to stock options and restricted stock units was estimated at $2.5 million for both the three and six months ended June 30, 2024[22] Strategic Considerations - The financial results indicate a need for strategic adjustments in response to ongoing operational challenges and market conditions[22] - The company plans to exclude the impact of held-for-sale operations from Adjusted EBITDA starting in the second quarter of 2024[22]
NeueHealth(NEUE) - 2024 Q1 - Quarterly Report
2024-05-10 20:07
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q For the quarterly period ended March 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40537 NEUEHEALTH, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 47-4991296 (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (State or oth ...
NeueHealth(NEUE) - 2024 Q1 - Earnings Call Transcript
2024-05-10 12:43
NeueHealth, Inc. (NYSE:NEUE) Q1 2024 Earnings Conference Call May 8, 2024 8:00 AM ET Company Participants Emily Lombardi - Investor Relations Mike Mikan - President and Chief Executive Officer Jay Matushak - Chief Financial Officer Conference Call Participants Marco Criscuolo - Nephron Research LLC Operator Good morning, everyone, and welcome to the NeueHealth Q1 2024 Earnings Call. My name is Drew, and I'll be the operator for today. After today's presentation, we will begin the Q&A session. [Operator Inst ...