Well Health Technologies posts record Q1 revenue, announces $30 million bought deal offering to fuel acquisitions

WELL Health
Despite record revenues the last two quarters, Well’s share price has fallen nearly 43 percent over six months.

Vancouver-based Well Health Technologies saw its revenue grow 395 percent year-over-year (YoY) to $126.5 million during the first quarter of 2022.

The company also generated an adjusted net income of $8.6 million in Q1, a significant improvement relative to the $2.4 million loss Well Health posted in the same period last year. Well Health attributed these results to a combination of organic growth and the acquisitions the company has made in the past year, which includes health services companies CRH Medical and MyHealth.

Well Health plans to leverage the net proceeds from the deal to support potential future acquisitions.

Strategic acquisitions represent a key part of Well Health’s growth strategy, and the company plans to execute even more, entering into a bought deal offering to sell $30 million worth of Well Health common shares to support these efforts.

Well Health chairman and CEO Hamed Shahbazi described Q1 as an “exceptional quarter” for Well Health, highlighting the company’s 15 percent YoY organic growth—a 50 percent acceleration compared to previous quarters—which it achieved despite navigating the typical seasonality of its specialist business in the United States in the first quarter.

“We witnessed strength across all segments of our business in Q1 including both primary and specialized care in both online and in-person channels,” said the CEO.

Well Health’s Q1 earnings follow a strong Q4 2021 for the company. But despite Well Health’s growth, the company’s shares are trading at $3.71 as of market close Friday, far below the healthtech firm’s 52-week high of $9.34. Over the past six months, the company’s stock price has fallen nearly 43 percent, amid a broader tech stock selloff. According to the financial newsletter The Motley Fool, investors have shed Well Health’s stock because of expectations of a slowdown in growth.

Founded in 2012 by Shahbazi, Well Health is an acquisitive healthtech company that is traded on the Toronto Stock Exchange under the symbol ‘WELL.’ The British Columbia-based firm offers a healthcare practitioner enablement platform that includes tools for digital patient engagement, electronic medical records, revenue cycle management, and data protection services. Well Health also claims to own and operate Canada’s largest network of outpatient medical clinics.

RELATED: Acquisitions propel Well Health to record revenues, profits in 2021

As part of the bought deal offering, a syndicate led by Eight Capital and Stifel GMP are purchasing 8.1 million shares in Well Health at a price of $3.70 per share. According to Well Health, the company has received “indications of interest” from an undisclosed large international sovereign wealth fund and Hong Kong tycoon Li Ka-shing, who has previously invested in the firm.

Well Health plans to leverage the net proceeds from the deal to support its growth initiatives, including potential future acquisitions in the physician acquisition, specialty clinic, and executive health spaces. The company also intends to use it for working capital and other general corporate purposes.

In early March, Well Health inked a deal to acquire gastroenterology anesthesia services provider Greater Connecticut Anesthesia Associates for consideration of $12.5 million.

Following its Q1 results, Well Health has increased its guidance for 2022, when it expects its annual revenue to exceed $525 million, up from its prior projection of more than $500 million. The company also anticipates being profitable this year on an adjusted net income basis.

Feature image courtesy Well Health Technologies.

Josh Scott

Josh Scott

Josh Scott is a BetaKit staff writer who loves to tell Canadian business and tech stories. His coverage is more complete than his moustache.

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