Market watch: Well Health, Magnet Forensics, Dialogue Health, and Thinkific Labs

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Gains and losses aren’t about the verticals, but rather the companies.

Gains and losses: We have them both, as a slew of public companies announced second quarter 2022 results. Well Health and Magnet Forensics both increased their bottom lines, while Dialogue Health continued to increase its revenues but also posted a larger loss for the second quarter running.

As for Thinkific Labs, the EdTech company’s revenues grew as did its losses in the second quarter, but its six months reporting showed losses ballooning from $6.2 million USD to $20.9 million USD. The company slashed 20 percent of its work force in March.

Generally, it appears that the current market doesn’t favour any particular vertical, but rather is affecting each company based on what it can deliver.

Well Health achieves record quarterly revenues

Digital healthcare company Well Health continued to increase its revenues, posting $140.3 million CAD in its second quarter of 2022, a 127 percent increase over the same period last year. As well, the company reported record adjusted EBITDA of $26.2 million CAD for the quarter compared to $11.9 million CAD for the second quarter of 2021.

Hamed Shahbazi, chairman and CEO of Well Health, attributed the strong quarter to organic growth while maintaining robust operating margins.

Eva Fong, the company’s CFO, noted: “Despite the current geo-political, inflationary, and turbulent economic environment, the company does not see any material influences or challenges that would impair its ability to deliver strong results in 2022.”

Well Health is increasing its guidance for 2022 annual revenue to exceed $550 million CAD from the previous guidance for annual revenue to exceed $525 million CAD. The company also expects to generate approximately $100 million CAD of adjusted EBITDA and anticipates profitability for the full year of 2022, on an adjusted net income basis.

Second quarter highlights included completing a bought deal public offering of shares for gross proceeds of approximately $34.5 million CAD for acquisitions; and the expansion of its $200 million CAD senior secure credit facilities. The company will use the latter to help grow its fleet of outpatient clinic locations.

Magnet Forensics shores up its bottom line

Digital investigations company Magnet Forensic shows crime – or at least investigating it – does pay. The company announced revenues of $23.1 million USD for its second quarter compared to $16.5 million USD in the same quarter last year.

Magnet said the increase was largely due to $4 million USD increase in software maintenance and support revenue and a $2.7 million USD increase in term license revenue, both of which are a result of growth within the company’s customer base.

Magnet drove its losses down to $1 million USD from $1.6 million USD in the same quarter a year ago. Adjusted EBITDA amounted to $3.5 million USD, a decrease of $1 million USD from the prior period.

RELATED: Execs, investors sell $74.4 million in Magnet Forensics shares

Magnet announced in May that it had acquired strategic intellectual property assets from cybersecurity software firm Comae Technologies, which is based in the United Arab Emirates and specializes in incident response and memory analysis.

Founded in 2010, Magnet develops digital investigation software that acquires, analyzes, reports on, and manages evidence from sources, including computers, mobile devices, IoT devices, and cloud services.

Dialogue continues to increase revenues, while losses grow

Dialogue Health Technologies reported an increase in revenues in the second quarter of 2022 to $23 million CAD from $16.6 million CAD for the same time last year. However, the healthtech’s losses also increased from $6.6 million CAD to $8.2 million CAD for the quarter.

Adjusted EBITDA loss was $4.8 million CAD, compared to a loss of $5.7 million CAD in the same period last year. The smaller loss was due to higher gross profit and strong cost control, partially offset by a deficit at Tictrac, according to the company. Dialogue acquired digital health and well-being company Tictrac in April for up to $56 million CAD, through a combination of cash-on-hand and a treasury issuance of common shares of the company.

As well as the acquisition of Tictrac, Dialogue launched Mental Health+ during the quarter, a program that it said streamlines its existing mental health services and emphasizes integration of varying levels of intervention across the care continuum.

Thinkific focuses on a return to profitability

For EdTech company Thinkific Labs, it’s all about a return to profitability. The company increased its revenues to $12.6 million USD in the second quarter up from $9.1 million USD in the same time period in 2021.

But, Thinkific posted a net loss of $10.1 million USD compared to $5.3 million USD in the previous year. The company also attributed its adjusted EBITDA loss of $7 million USD to continued investments in sales and marketing and research and development.

After a year of mounting losses, and a sinking stock price, Thinkific cut 100 people from its staff in March.

RELATED: Following 2021 losses, Thinkific to lay off 100 employees

“Our Adjusted EBITDA loss this quarter of $7.0 million was a significant improvement from recent trends,” said Corinne Hua, CFO of Thinkific. “As we continue to grow the top-line, we will be disciplined on our spend, and focus our investments in a prudent manner. The tough decision we took earlier this year to reduce our team was the right one, and we are seeing the results of our improved cost structure.”

Greg Smith, Thinkific’s CEO and co-founder, added that he believe a large and growing market opportunity was still available to the company. “I am confident that our product roadmap, disciplined investments, and appropriate cost structure will both enable our growth strategy and ensure our return to profitability,” Smith said.

Founded in 2012, Thinkific provides software designed to help entrepreneurs and businesses launch, grow, and diversify their businesses by creating and selling online courses and other learning products through its platform.

Charles Mandel

Charles Mandel

Charles Mandel's reporting and writing on technology has appeared in, Canadian Business, Report on Business Magazine, Canada's National Observer, The Globe and Mail, and the National Post, among many others. He lives off-grid in Nova Scotia.

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