The Oncology Institute(US:TOI)2023-03-09 23:33Financial Data and Key Metrics Changes - Consolidated revenue for Q4 2022 was $71 million, an increase of 36.6% compared to Q4 2021, and an increase of 9.9% compared to Q3 2022 [9] - Gross profit in Q4 2022 was $16 million, an increase of 87.6% compared to Q4 2021 [9] - Full year 2022 consolidated revenue was $252 million, an increase of 24.4% compared to the prior year [10] - Full year gross profit for 2022 was $52 million, an increase of 27.5% year-over-year [10] - Net income for the year ended December 31, 2022, was $1.7 million, an increase of $12.6 million compared to the prior year [10] - Adjusted EBITDA for the full year 2022 was negative $24 million [10] Business Line Data and Key Metrics Changes - The company added two new clinics in Q4 2022, expanding its network to 62 clinics across five states, representing a 17% increase in the number of clinics and providers [5] - The company grew capitated membership by over 100,000 lives in 2022 [8] Market Data and Key Metrics Changes - The company expanded into its 15th market with the acquisition of two practices in South Florida [6] - The company ended 2022 with $132 million in cash, cash equivalents, and investments [7] Company Strategy and Development Direction - The company aims to refine and optimize its model and expansion markets, grow legacy markets, and reduce cash burn through improved efficiency and technology solutions [12] - The focus is on transitioning gain share contracts to population risk agreements and expanding service offerings in existing clinics [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged headwinds such as Medi-Cal restrictions and a tight labor market but expressed optimism for 2023, expecting continued growth [4][12] - The company is taking a conservative view on guidance for 2023, anticipating revenue between $290 million to $320 million, representing 15% to 27% growth over 2022 [11] Other Important Information - The company completed a $110 million strategic investment from Deerfield Management Company in August 2022 [7] - The company remediated two previously disclosed material weaknesses in financial controls [8] Q&A Session Summary Question: Update on California Medi-Cal issue - Management explained that the transition to a new vendor prevented the company from prescribing drugs to certain Medi-Cal patients and that they are working to become licensed as a pharmacy [13][14] Question: Changes in EBITDA guidance - Management indicated that the guidance reflects a conservative view due to slower-than-expected growth in expansion markets and compression on IV drug margins [15][16] Question: Status of acquisitions - Management confirmed that no unannounced acquisitions are included in the current guidance, indicating potential upside [17] Question: 2023 revenue guidance details - Management noted that the exit run rate from Q4 2022 provides a significant portion of the expected revenue growth for 2023 [24] Question: Gain share contracts - Management clarified that one of the new gain share contracts in Florida is with ChenMed, with optimism for future expansion [25][26] Question: Non-current investments - Management stated that the $59 million in non-current investments is primarily in T-bills, which are available for operations and acquisitions [27]