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Guardian Pharmacy Services, Inc.(GRDN) - 2024 Q3 - Quarterly Report
GRDNGuardian Pharmacy Services, Inc.(GRDN)2024-11-12 22:00

Financial Performance - Revenues for the three months ended September 30, 2023, were 262,741thousand,comparedto262,741 thousand, compared to 314,393 thousand for the same period in 2024, representing a decrease of approximately 16.4%[11] - Gross profit for the three months ended September 30, 2023, was 52,192thousand,whileforthesameperiodin2024,itincreasedto52,192 thousand, while for the same period in 2024, it increased to 60,878 thousand, reflecting a growth of about 16.2%[11] - Operating loss for the three months ended September 30, 2023, was (6,330)thousand,comparedtoanoperatinglossof(6,330) thousand, compared to an operating loss of (104,613) thousand for the same period in 2024, indicating an improvement in operational efficiency[11] - Net loss attributable to Guardian Pharmacy Services, Inc. for the three months ended September 30, 2023, was (6,995)thousand,comparedtoanetlossof(6,995) thousand, compared to a net loss of (121,990) thousand for the same period in 2024, showing a significant reduction in losses[11] - For the nine months ended September 30, 2024, the company reported a net loss of 82,874,comparedtoanetincomeof82,874, compared to a net income of 23,161 for the same period in 2023[15] - Net income (loss) for the three months ended September 30, 2024 was (121.99)million,asignificantdeclinecomparedtothepreviousyear[100]Expenses−Selling,general,andadministrativeexpensesforthethreemonthsendedSeptember30,2023,were(121.99) million, a significant decline compared to the previous year[100] Expenses - Selling, general, and administrative expenses for the three months ended September 30, 2023, were 58,522 thousand, while for the same period in 2024, they rose to 165,491thousand,indicatinganincreaseofapproximately182.5165,491 thousand, indicating an increase of approximately 182.5%[11] - Interest expense for the three months ended September 30, 2023, was 716 thousand, compared to 1,026thousandforthesameperiodin2024,reflectingadecreaseofabout30.21,026 thousand for the same period in 2024, reflecting a decrease of about 30.2%[11] - Total other expenses for the three months ended September 30, 2023, were 665 thousand, while for the same period in 2024, they increased to 1,028thousand,representingariseofapproximately54.51,028 thousand, representing a rise of approximately 54.5%[11] - The company experienced a significant increase in share-based compensation expense, rising to 128,029 for the nine months ended September 30, 2024, compared to 16,632forthesameperiodin2023[15]−Selling,general,andadministrativeexpensesforthethreemonthsendedSeptember30,2024increasedby16,632 for the same period in 2023[15] - Selling, general, and administrative expenses for the three months ended September 30, 2024 increased by 107.0 million or 182.8%, primarily due to share-based compensation related to the Corporate Reorganization and IPO[105] - Share-based compensation expense for the three months ended September 30, 2024 was 122.4million,significantlyhigherthan122.4 million, significantly higher than 20.7 million in the same period in 2023[105] Cash Flow and Equity - Cash and cash equivalents at the end of the period increased to 37,221from37,221 from 621 at the beginning of the period, indicating a net change in cash of 36,469[15]−Thecompanyreportednetcashprovidedbyoperatingactivitiesof36,469[15] - The company reported net cash provided by operating activities of 35,623 for the nine months ended September 30, 2024, down from 56,265forthesameperiodin2023[15]−Thebalanceofmembers′equityasofSeptember30,2023,was56,265 for the same period in 2023[15] - The balance of members' equity as of September 30, 2023, was 26,191, a decrease from 44,013asofJune30,2023[13]−AsofJune30,2024,totalequitydecreasedto44,013 as of June 30, 2023[13] - As of June 30, 2024, total equity decreased to 57,213, down from 59,859asofDecember31,2023,reflectinganetincomeof59,859 as of December 31, 2023, reflecting a net income of 15,848 and distributions of 20,921duringtheperiod[12]AcquisitionsandIPO−TheCompanycompleteditsIPOonSeptember27,2024,issuing9,200,000sharesatapublicofferingpriceof20,921 during the period[12] Acquisitions and IPO - The Company completed its IPO on September 27, 2024, issuing 9,200,000 shares at a public offering price of 14.00 per share, resulting in net proceeds of 119,784afterdeductingunderwritingdiscountsof119,784 after deducting underwriting discounts of 9,016[23] - Total consideration for acquisitions during the nine months ended September 30, 2024, was 15,882,whichincludedcashof15,882, which included cash of 12,460 and contingent earnout payments of up to 2,700[35]−Thecashpaymentrelatedtothemergerconsiderationduringthecorporatereorganizationwas2,700[35] - The cash payment related to the merger consideration during the corporate reorganization was 55.2 million, funded by IPO proceeds[84] - The Company incurred 13,047inofferingcostsrelatedtotheIPO,whichwererecordedtoadditionalpaid−incapital[23]MarketandCompetitivePosition−Thecompanycontinuestofacerisksrelatedtomarketcompetition,regulatorychanges,andsupplychaindisruptions,whichcouldimpactfutureperformance[7]−ThecompanyhasastrongcompetitivepositionasaproviderofpharmacyservicestoALFsandBHFs,whichareseenasthehighestgrowthsectoroftheLTCFmarket[81]−Thecompany’scoregrowthstrategyfocusesonincreasingthenumberofresidentsservedthroughacombinationoforganicandacquiredgrowth[82]OperationalMetrics−Thenumberofresidentsservedincreasedfrom161,000inSeptember2023to180,000inSeptember2024,contributingtorevenuegrowth[100]−Prescriptionsdispensedrosefrom5.6millioninthethreemonthsendedSeptember30,2023to6.4millioninthesameperiodin2024,reflectingoperationalgrowth[100]−RevenueassociatedwiththeacquisitionsforthethreemonthsendedSeptember30,2024,is13,047 in offering costs related to the IPO, which were recorded to additional paid-in capital[23] Market and Competitive Position - The company continues to face risks related to market competition, regulatory changes, and supply chain disruptions, which could impact future performance[7] - The company has a strong competitive position as a provider of pharmacy services to ALFs and BHFs, which are seen as the highest growth sector of the LTCF market[81] - The company’s core growth strategy focuses on increasing the number of residents served through a combination of organic and acquired growth[82] Operational Metrics - The number of residents served increased from 161,000 in September 2023 to 180,000 in September 2024, contributing to revenue growth[100] - Prescriptions dispensed rose from 5.6 million in the three months ended September 30, 2023 to 6.4 million in the same period in 2024, reflecting operational growth[100] - Revenue associated with the acquisitions for the three months ended September 30, 2024, is 16,563,000, and for the nine months, it is 32,434,000[42]DebtandFinancing−Thecompanyenteredintoanewtermloanof32,434,000[42] Debt and Financing - The company entered into a new term loan of 15,000,000, extending the maturity date to April 23, 2027, with quarterly installments of 1,375,000untilmaturity[45]−AsofSeptember30,2024,totalnotespayableincreasedfrom1,375,000 until maturity[45] - As of September 30, 2024, total notes payable increased from 22,969,000 on December 31, 2023, to 34,099,000[46]−Futureprincipalpaymentobligationsforlong−termdebttotal34,099,000[46] - Future principal payment obligations for long-term debt total 34,250,000, with significant payments due in 2027[47] - The company was in compliance with all debt covenants as of September 30, 2024[47] Taxation and Accounting - The Company recorded an incremental net deferred tax asset/(liability) of $5,973 through additional paid-in capital as a result of the Corporate Reorganization[22] - The effective tax rate for the period after the Corporate Reorganization was -0.1%, primarily due to the non-deductible share-based compensation charge[74] - The Company adopted new accounting standards on January 1, 2023, with no material impact on its Consolidated Financial Statements[31] - The Company is currently evaluating the impact of adopting new accounting standards related to segment reporting and income tax disclosures, expected to be effective in 2024 and 2025[32][33]