TruBridge(TBRG) - 2024 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total bookings for Q2 2024 reached $23.3 million, marking an 11$20 million [4][14] - Cash flow from operations was positive at $13.8 million for the quarter, compared to$0.7 million in the same quarter last year [11][17] - Revenue for the quarter was $84.7 million, essentially flat compared to the previous year, impacted by the divestiture of AHT and the sunsetting of Centric [14][15] - Adjusted EBITDA was$12.6 million, a 12% increase year-over-year and a 33% increase sequentially, with an adjusted EBITDA margin of 14.8% [16] Business Line Data and Key Metrics Changes - Revenue Cycle Management (RCM) generated $54.1 million, accounting for approximately 64$9.8 million, with over two-thirds coming from existing customers, indicating strong customer satisfaction [14] - The integrated nTrust solution saw a 60% increase in new clients in the first half of 2024 compared to the same period in 2023 [5] Market Data and Key Metrics Changes - The company reported that over 90% of projected 2024 revenue is under contract, indicating strong future revenue visibility [7] - The offshoring initiative has progressed, with 43% of CBO and EVO operations now offshore, up from 25% at the end of Q1 [8] Company Strategy and Development Direction - The company is focused on enhancing its financial quality controls and forecasting processes, aiming for long-term margin expansion despite short-term challenges [10][13] - Continued emphasis on client retention and proactive customer management is a priority, especially during the transition to offshore operations [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the continued momentum in bookings and the potential for revenue growth in the second half of the year [4][7] - The competitive landscape is evolving, with increasing acceptance of outsourcing models among hospitals, which is expected to drive demand for the company's services [38] Other Important Information - The company is on track to achieve $5 million in cost savings for the year, with most initiatives already initiated [11] - The company reiterated its full-year revenue guidance of$330 million to $340 million and adjusted EBITDA guidance of$45 million to $50 million [18] Q&A Session Summary Question: Can you talk about margin progression? - Management indicated that while margins are expected to improve, they may be muted in the near term due to the transition to offshore staffing [20][21] Question: How is the financial health of your customer base? - Management noted that the customer base is mixed but has benefited from past COVID relief, allowing for cash accumulation [25] Question: Is there momentum biased towards one segment in the second half? - Management sees growth opportunities in both RCM and EHR segments, with a larger market opportunity in RCM [28][30] Question: How is the legacy base holding up? - Retention rates outside of the Centric customer base are strong, with ongoing investments to keep customers satisfied [45] Question: Are you seeing utilization strength flow through to RCM? - Management observed that hospitals expanding services are seeing increased utilization, which is beneficial for RCM [47]