XpresSpa Group(XWEL) - 2021 Q3 - Quarterly Report

Business Operations - XpresSpa Group operates three reportable segments: XpresSpa™, XpresTest™, and Treat™, focusing on travel health and wellness services [138]. - As of September 30, 2021, XpresCheck™ Wellness Centers have opened 14 clinics in 12 airports across 11 states, providing COVID-19 testing services [144]. - XpresSpa locations in Dubai and Amsterdam continue to operate, contributing to the company's international presence [147]. Financial Performance - Total revenue for Q3 2021 was $26,767, a significant increase from $201 in Q3 2020, primarily driven by patient service revenue of $25,351 [164][165]. - Adjusted EBITDA for Q3 2021 was $8,699, compared to a loss of $5,148 in Q3 2020, indicating improved operational performance [158]. - Net income attributable to common shareholders for Q3 2021 was $5,597, a recovery from a loss of $6,110 in Q3 2020 [158]. - Total revenue for the nine months ended September 30, 2021, reached $44,371, a substantial increase from $8,062 in the same period of 2020 [172]. - Cost of sales for the nine months ended September 30, 2021, was $25,522, up from $9,551 in 2020, primarily due to expenses from the XpresCheck™ Wellness Centers [173]. Cost and Expenses - Cost of sales for Q3 2021 was $13,662, up from $1,405 in Q3 2020, mainly due to costs incurred in the XpresCheck™ Wellness Centers [166]. - General and administrative expenses increased by approximately 19.0% to $5,196 in Q3 2021, attributed to start-up costs for XpresTest and XpresCheck™ Wellness Centers [168]. - Depreciation and amortization for Q3 2021 decreased by approximately 40.2% to $852, reflecting lower amortization of leasehold improvements [167]. - Other non-operating expenses for the nine months ended September 30, 2021, totaled $830, compared to $389 in the same period of 2020, reflecting an increase of 113% [178]. Cash and Capital Management - As of September 30, 2021, the company had cash and cash equivalents of $109,161 and total current assets of $113,100, resulting in positive working capital of $95,902, an increase from $78,302 as of December 31, 2020 [180]. - During the nine months ended September 30, 2021, the company raised approximately $19,161 from the exercise of warrants for a total of 11,223,529 common shares [181]. - The company authorized a stock repurchase program on August 31, 2021, allowing for the purchase of up to 15 million shares, with 250,000 shares repurchased for $450 during the three and nine months ended September 30, 2021 [182]. - Interest expense decreased to $(31) for the nine months ended September 30, 2021, from $1,856 in 2020, indicating a reduction of approximately 101.7% [179]. Strategic Initiatives - A pilot program with the CDC aims to conduct biosurveillance monitoring for SARS-CoV-2 variants, with expected revenue recognition of approximately $1.5 million in Q4 2021 [146]. - The company launched a dedicated website for Treat™, converting it to www.treat.com, to expand digital growth opportunities through subscription-based services [150]. - XpresSpa Group plans to test new touchless massage services and retail items in Q4 2021 as part of its strategy to enhance customer offerings [148]. - The company anticipates leveraging technology and personalized services to provide integrated healthcare in a post-pandemic world [140]. - The company continues to focus on improving overall operating profitability while addressing working capital deficiencies and long-term debt [183]. - The ongoing COVID-19 pandemic may have material adverse impacts on the company's liquidity position and access to capital [183]. - The company is exploring strategic partnerships and streamlining operations as part of its new strategies [183]. Investment and Losses - The company recognized a loss on revaluation of warrants and conversion options of $— for the nine months ended September 30, 2021, compared to a loss of $50,917 in 2020 [177]. - Loss on equity investments amounted to $716 for the nine months ended September 30, 2021, with no losses reported in the same period of 2020 [178].