CareCloud(CCLD) - 2024 Q4 - Annual Report

Financial Performance - The company reported net revenue of $110.837 million for the year ended December 31, 2024, a decrease of 5.2$117.059 million in 2023[261] - Adjusted EBITDA for 2024 was $24.057 million, significantly up from$15.429 million in 2023, representing a year-over-year increase of 55.5%[261] - The company achieved a GAAP net income of $7.851 million in 2024, compared to a net loss of$48.674 million in 2023[261] - Adjusted operating income for 2024 was $11.455 million, up from$5.967 million in 2023, resulting in an adjusted operating margin of 10.3% compared to 5.1% in the previous year[264] - Non-GAAP adjusted net income for 2024 was $10.520 million, compared to$4.801 million in 2023, indicating a substantial improvement in profitability[264] - The company reported a non-GAAP adjusted earnings per share of $0.65 for 2024, an increase from$0.30 in 2023[266] - The company’s GAAP operating margin improved to 8.2% in 2024 from a negative 40.2% in 2023[264] - Operating income for 2024 was $9,121,000, compared to an operating loss of$47,115,000 in 2023[267] - Net income for 2024 was $7,851,000, a significant improvement from a net loss of$48,674,000 in 2023[267] - Net income attributable to common shareholders was a loss of $4,459,000 in 2024, an improvement from a loss of$64,348,000 in 2023[267] Expenses and Cost Management - The company’s offshore operations accounted for approximately 15% of total expenses in 2024, up from 9% in 2023, with personnel-related costs making up about 75% of these expenses[256] - Total operating expenses decreased to $101,716,000 in 2024 from$164,174,000 in 2023, reflecting a reduction of 38%[267] - Direct operating costs represented about 13% of total costs in 2024, compared to 11% in 2023, indicating a slight increase in operational efficiency[282] - General and administrative expenses accounted for approximately 22% of total expenses in 2024, up from 17% in 2023, suggesting increased administrative costs[284] - Selling and marketing expenses decreased by $3.4 million or 35$6.2 million in 2024 from $9.7 million in 2023[314] - General and administrative expenses decreased by$5.3 million or 25% to $16.1 million in 2024 from$21.5 million in 2023[315] - Research and development expenses decreased by $955,000 or 20$3.8 million in 2024 from $4.7 million in 2023[316] - Total operating expenses for 2024 were$101.7 million, a decrease of $62.5 million or 38$164.2 million in 2023[313] Cash Flow and Financial Position - Cash balance increased to $5,145,000 in 2024 from$3,331,000 in 2023[268] - Positive cash flow from operations increased to $20.6 million in 2024 from$15.5 million in 2023, representing a 34% increase[331] - Cash used in investing activities decreased to $7.4 million in 2024 from$11.6 million in 2023, a reduction of $4.2 million[336] - Cash used in financing activities was$11.3 million in 2024, down from $13.3 million in 2023, including the full repayment of a$10 million credit line[337] - The company recorded a net increase in cash of $1.8 million in 2024, compared to a decrease of$8.9 million in 2023, marking a turnaround of $10.8 million[331] Client and Revenue Metrics - The company served approximately 40,000 providers across about 2,600 practices as of December 31, 2024, maintaining a stable client base[275] - Customer renewal rates improved to 95$73.7 million in 2024, down from $76.6 million in 2023[310] - Professional services revenue decreased by$4.8 million in 2024 compared to 2023, primarily due to the winding down of services for two large accounts[311] Goodwill and Impairment - Goodwill impairment charges in 2023 amounted to $42,000,000, reflecting a significant write-down related to the Healthcare IT reporting unit[287] - Goodwill impairment of approximately$2 million was recorded in October 2023, with an additional impairment of approximately $40 million recorded in December 2023[305] - Goodwill impairment charge of$42 million was recorded in 2023, resulting in the reversal of the entire deferred tax liability at December 31, 2023[325] Shareholder Information - The total fully diluted shares increased to 16,498,736 in 2024 from 16,614,000 in 2023[266] - The weighted average common shares outstanding increased to 16,146,975 in 2024 from 15,669,472 in 2023[267] - Shareholders' equity increased to $49,774,000 in 2024 from$41,717,000 in 2023[268] Tax and Interest - The income tax provision for 2024 was $160,000, contrasting with a tax benefit of$364,000 in 2023[323] - Interest income decreased by $66,000 or 43$88,000 for the year ended December 31, 2024, compared to $154,000 in 2023[320] - Interest expense decreased by$294,000 or 25% to $900,000 for the year ended December 31, 2024, from$1.2 million in 2023[321] - Other expense - net improved to $298,000 in 2024 from$883,000 in 2023, primarily due to a foreign exchange gain of $130,000 compared to a loss of$790,000 in 2023[322] Future Outlook - The company plans to continue leveraging its offshore operations to maintain competitive cost advantages in the healthcare IT sector[256] - The company expects to achieve further economies of scale as it grows, potentially reducing direct operating costs as a percentage of revenue[282] - The company has a total federal NOL carry forward of approximately $265 million, with$187 million expiring between 2031 and 2038[328]