Scienture (SCNX) 8 Nov 222022 Q3 Earnings call transcript

Good afternoon, and welcome to TRxADE Conference Call. [Operator Instructions]. Today with us, we have Suren Ajjarapu, Howard Dossand and Janet Huffman. I would now like to turn the conference over to the speakers. Please go ahead.

thank joining and today. operator, you, you us for Thank XXXX you Financial I'd welcome our Third like to to Quarter Call. Results Conference

to Our our the website. the SEC third XXXX and company, company's and interest also and furnished after market announcing business required continued Form webcast. company release obligation, call the results We've of release, revise and release to press today on statements forward-looking today's issued of of statements the the made X-K. rates quarter posted is of not results COVID-XX, on such was company close as subject press financial or estimate limited operations. These our will performance statements include, assumes uncertainties no made project including These to, outlook are increased of as on the statements. to our the be by potential this assumptions. and operations guarantee that any speak include performance that in may call on forward-looking except and for hereof, and date future future press do results These statements inflation of the and or law, are not statements risks, webcast only or but impact the Statements

filed not that For report include documents XX-Q are These limited our on risk release, factors differ subsequently assumptions Commission. on but on Exchange report statements, information Form or quarterly periodic and Form most risks, to, results to Securities uncertainties file the and press and the any may current X-K. recent report to please with actual cause and materially we refer from forward-looking documents

to, of GAAP measures, are supplemental non-GAAP we useful for, from will during addition non-GAAP be and addition, and measures today's results. These we not as believe substitute In or isolation performance. should a in financial in measures which considered as discuss call TRxADE's webcast,

our end results to results Unless earnings comparisons comparable this period You be additional comparable measures, including with all the reconciliations XXXX. financial the non-GAAP find fiscal at our otherwise can stated, for these of GAAP in press will of disclosures regarding call release.

the like to to no During I'd Executive the and limit portion more call to time, one please floor than Ajjarapu, question At turn Officer. call, follow-up. the this company's is over today's question-and-answer one the Suren Suren, yours. Chief yourself of

Thank you, Janet.

exchange see to continue XXXX We in our platform. pharmaceutical for TRxADE core improvement

Our we and a nationwide remain support to to exciting footprint grow, of users. focus network new ways growing the committed of registered to continues large

loyalty exciting strategic to dedicated business-to-business In Pennsylvania, the XX, new local groups. deploy Corp. offer multiple retail new in with products strengthen With Maryland. help September, our third we announced the small access technology new insurance are supporting these to local October to firms, for their better medium our pharmacy. announced them customers employer we enable retail of we development innovative brokerage to pharmacies and products with pharmacies, to service services that On and York, for our partnerships telemedicine and their assist and New partnerships They in Wakefern Connecticut the growing provide partnerships innovative to services. New provide the access to locations These affordable local Food healthcare XXXX also to ShopRite business. quarter in us throughout convenient of telemedicine Jersey, pharmacy our pharmacy-led partnership with services to

experience retail new like I'd for financial others and do through with digitalizing was into are as extremely or price an or fair independent of an are same a of Traditional and of terms, estimated to which approximately conundrum launch as a for and the a journey drug would to company, no the a proceeded business-to-business or transparent laborious independent accredited delivery pharmacies well buying are, drug in the we slow to process independent the operational pharmaceutical who annual time-inefficient incredible process. own purchasing market our together of are difficult prescription market the quarter, transparency operate the We approximately TRxADE. detailed pharmacy to who those optimization of and selling how maintain $XX.X market design, walk identified in and we you create patient pharmacies through potential TRxADE, these walk a you as obtaining drug. unfavorable engagement. through for what with we Before launch results more the nationwide. and procurement, and billion Prior the together the efficient pharmacy, uniquely quotes an national power payment provide pharmacies, bringing nation's web-based provide inefficiency, We wholesalers platform, this to paying XX,XXX suppliers the independent insight

a they know, that competing terms Our We price pharmacies payment a on the independent platform next-day suppliers, up radical to net suppliers, purchase certain competition XX% on with receiving from up delivery. with this reduction and lead often among are a pharmacies' drug-level scale fair pharmaceutical of let savings price drug of costs, economy a believe transparency, fair products. total annual to XX% in

across manually or of platform prescription at a having negative compare saves fulfilling from pharmacists hours distributors, and of reimbursement, hundreds Our eliminating unnecessary saving prices to labor a annually, loss.

revenue simple. is model Our

pharmaceuticals on we third brand attention have X% administrative on members for PayPal pharmacies added plus We To XXXX, Visa of platform, our from pharmaceutical currently approximately nationwide, We our are the XXXX. paid X% new registered pass over generic in to XXX model. registered to third model. of in validating business of XXX on or members XX,XXX the our pharmaceuticals independent quarter have date, of with quarter an to the platform, compared up incredible and that price like to through fee similar seen buying up success garnering

company plan Securities on net the in strategic our to and compared the the and the and the like use to over proceeds details quarter the on TRxADE platform, filed we approximately The now the in to includes approximately some XX% XXXX. October $X.XX can Form and growth I'd to the our volume Officer, across for XXXX. X-K Prime. cash execute key on sales XXXX with our The X, proceeds transaction plans regarding our platform same metric turn Commission Exchange increase company third growth prefunded Subsequent to to common of to from Financial to in full XXXX. processed exciting the third for call million cash through walk Huffman, information our the of be an The Another of financial Janet warrants. highlights found X, of working third a quarter October TRxADE capital, Chief stock, TRxADE the in quarter were quarter, closed of sale $X.X million. of warrants platform

Suren. you, Thank

quarter the results. Let quarter quarter XXXX This to compared us third is X% X% by TRxADE the third revenues revenue $X.X quarter in third the $X.X the of million, discuss in by compared decrease same platform for year. and million XXXX, the to decreased in Consolidated TRxADE Community of driven Pharmacy revenue last Prime same to XXXX increased XXXX. quarter the generated as revenues Specialty The of subsidiary. in

automation adjusted were Prime to experienced executing an XX% on the and important overhead decline result revenue employee the In there a implementing the initiatives gross quarter, sales gross and we of to we expense TRxADE metrics XXXX, included third quarter that vendor reduce the improve. in partnerships. Although expense respectively. X% automation included, and improved vendor in reduce negative quarters software XXXX, a work software TRxADE Prime this margin to platform, X% pricing compared third Initiatives quarter third for other for compared same several to the Initiatives restructuring. margin of and improve comparable overhead and improve XXXX, This was gross margin. focus improved to positive XXXX to to of

As these in third XXXX. changes, compared quarter was overhead a the XXXX, same to the result expense reduced for of XX% quarter of

to the revenue, Net to quarter in a as due compared $X.X compared loss Ian. Community foundation $X.X decreased off operating compared in company third same quarter the million XXXX. basic Adjusted share platform, or last to of September, the The third the decreased bad the the discussed, of and revenues of of million working margins the diluted XX% expenses compared week and share XXXX TRxADE the revenues, per to overhead third for due due a in XXXX, to million profit grow forward, XXXX, sales periods, positive quarter gross Prime, diluted decrease by compared and reduced debt expense $X.X year. partially negative outstanding, generated or Hurricane a of Prime $X.X XXXX, improved drivers TRxADE Pharmacy in the these $X.XX Operating million $X.X to for the to XXXX. bad recorded revenue gross in quarter Prime. the is basic approximately of the XXXX negative in to $X.X Specialty were outstanding last comparable and is driven Other quarter same The TRxADE $X.X of for third expense same million in quarter million negative margin. the expenses is negative or Gross is as decrease non-GAAP quarter to XXXX the by in from to quarter gross per third million the to negative last in $XXX,XXX of the partially are was recovery $X.X XXXX. increased was XXXX. debt XXXX the of TRxADE million compared XXXX the in quarter improved Moving increased and in The XX% and in same operating of for $X.XX with previously financial of increasing EBITDA, expenses improved third written margin of revenue year. measure, amounts as quarter $XXX,XXX in

the February were spent for XXXX. balance call May in Suren of of cash XXXX, a in by of settlement with formation decrease million of spent back equivalents February wages, of and mainly compared to in of as With XX, our purchases Community the I as for Pharmacy cash driven XXXX December in is $X.X Specialty $XXX,XXX legal spending SOSRx will sheet; on with at connection and salaries XXXX, XXst, $XXX,XXX XXXX. million for and inventory turn in as LLC $XXX,XXX Looking spent cash September The remarks. that, of closing $X.X part

summary, new revenue base. business, Thank to our forward core while In you, exciting we're Janet. diversifying focusing our strategic drive on partnerships

future as an I'll stakeholders. creating consumers that, rapid a the the healthcare, for exciting fellow building what seeing whole, continue affordable an we to operational value the are Operator? sustainable compelling allowing of incredible forward shareholders. value long-term to think for to session. we as healthcare our begin while I proposition our execution, Taken all turn question-and-answer over it With to building holds, look ecosystem, access pace operator I

Instructions]. [Operator

Allen Maxim from comes question first Our Klee, Group.

cost Good job on and control. margins

terms in a -- expect of -- you it's how go explain think And strategically how little or Prime, opportunity line margin and where how talk is can this to of on you where top the going the TRxADE this lower, again now does you helps from grow customers? do is more For to it your side? about there

we to can make, same to platform, product kind they the drug of and where search they what before give our Prime can we to see vendors, that through we go are Yes. be like can the line. We their can the they And our to redirect intelligence, our back on time, that's to to come model can retooled our can Yes, our way top comment is the the they that go That's they a to you can back on primary. Prime reason margin, then also. has searching, Currently, the bottom for on site their the contract, and spend able systems, TRxADE Allen. kind what pharmacies customers sure platform, the of question, pharmacies and taken the product primary buy great focus well access not margins can primary that that product our pricing the as the our TRxADE increases well focus what as line make gross the we of margin. only can gross . go come artificial kind That care. they Thank implemented time, would upfront, to availability to on the adjust at to

about That's great. out? partnership, -- -- any And metrics And then, and about update then Wakefern provide? on are rolling you the you're think Bonum with thinking ShopRite maybe, how Any that you can there Health? how

box we're quarter, a give I in a We're at our and So in think through pharmacies still opportunities. the chain that CVS. is to to empower we're for means looking of Health, in model, still these independent compete to out or That try mentioned originally traction up find brought trying still that trying our strategic as we Bonum, that to buyer that to strategic independent phase are joint Health, Walgreens not our like to we a We're getting there alternative XXX% Bonham struggle second we that expectations. against and access as still mentioned, stores venture and pharmacies. ways Bonum nascent to

Our Howard Brothers. Halpern, next Taglich from question comes

margins. terms in a that the is pharmacy on engagement than That on -- was have it faster Congratulations to and uptake brokerage maybe with Bonum in your firms, going to Bonum the follow insurance small potentially of Look, I'll more private geared to nice see. Health? partners? Is Health, engage businesses might that

point, That's go to that's employee Yes, excellent Howard. than people after intention an XX less groups. our uninsured,

that's employer uninsured forms. and and we already these versus drugstores. -- to reason serving we're They're or into pivoted those our what that's So that's brokerage trying firms employer insurance the hope, the to the like brokerage self-insured an we are groups, -- chain push

bit talk is you you -- SOSRx to in And of know early, little really about can to do how I but when where the going? it? get the joint a rolling And anticipate start development it's venture things

are platform. struggling, The adoption because to the manufacturers kind good, electronic is concept Yes. dealing not but this was of used the still

going still traditional the through opportunities traditional business. way doing or they're So of

-- X similar at look get when there, and looking for the try kind a you fashion. back took there company and in a of it -- we partner don't or SOSRx. If SOSRx -- if alternative be years those our traction a JV won't it us like as customer, at XXXX, first for can we'll at we then before be to we opportunities TRxADE, looking is started means,

one just one. last And

restructured somewhere to year, on first get can we next -- overhead of in the with the continued operational you With might in line? the your improvement improvement that likely in margins growth, how and anticipate costs, some incremental gross just and income we half breakeven revenue

we're you're numbers, towards aware, line bottom cannot towards Howard, as As definitely positive we working as the soon, top well predict but the working We're that that line. both that.

Klee, Group. Maxim [Operator Instructions]. Allen proceed with We

Okay.

after your progressing? how So update on that's opportunity, business a I group going longer-term that's but know any purchasing organizations,

that could please? sorry, question, I'm Allen, you repeat

progressing? primary on that's Working GPOs, the an just of kind them update drugs? of Yes. how with provider to be

to third million Yes. We're of as alone, XXXX. still number members when that's quarter saw of the bringing the in in reason the speak, you quarter we $X.XX compared the at $XXX third

but So trying we're drugs we the them like, the variety adoption to of is increasing still give slowly of growing, that's breadth are the the catalog, what focusing.

expect As more platform. we improve that GPO our catalog, I think to and more we purchases

give think that? -- you signing Can on update talked -- Solutions of great. last GALT agreement last Okay, the Pharmaceuticals. a of distribution Integra what's with about status Pharma was an where Kind it I you quarter,

the mentioned I electronic earlier the As time have Howard, understanding platforms. manufacturers to tough

very slow. So going still that's

So quarter of probably some year, in third of next the kind or towards we see middle year results that the partnership. of from next

$X.X the around the or...? came quarters, rate at, about think quarter reasonable for to Is Okay. next expenses And for few your operating -- million. a so run then in that

much Yes, in to -- you think that. Yes. pretty standard Prime anticipate the this some new growth until that's more time. at much unless may think I and but But pretty so into model, have people that's have TRxADE I we exponential

about week. then said the hurricane Okay. impacted And the missed what that? there What impact apologize, said the was a X something in something I well, things; can there I was was my one, you -- question, And by was? of last quantify last impact area

let I'll first I Yes. will Janet and address explain.

buildings walk evacuation hit, directly though zones of we that's division, that's warehouse consumer-based got not stores to a have stuff, but can is and have Tampa the so have on most a had down and Pharmacy Specialty affected. add the may we to what into people Community announced, to federal our if Even -- and and a shut pharmacy, we Janet, and that? been impacted else business. anything So

No, that's correct.

all prescriptions. quarter. those the did So But to the fill unable were week, patients back in come last we subsequent

the the pharmacy us and So of prescriptions. to impacted week those it not -- fill QX with being last it having was able close

much a impact might of sense Do how of revenue you that have had? have a

I September, you of have adjustments impact sales number. Community by with Pharmacy that as exact do partially Specialty are in well standard just and also then contracts. that was see not The week revenue payer adjustments revenue some for driven an last that

So I Hurricane don't for know the the exact number Ian impact.

Okay. kind And of in might other the any are onetime that quarter? there impacts have been

about specifically? you Are talking revenue

did think debt example, quarter in I Revenue bad or this recovery, have happen a or...? For cost? might that you

Yes.

So referenced TRxADE recovery debt debt year, write-off. bad we started this on And there $XXX,XXX there, in for my in had we -- write-off were section Prime. XXXX, that I

So in that, debt we onetime write-off. think cannot quarter, $XXX,XXX of didn't that we that already Other significant recovered I any third know. the than of

turn remarks. question-and-answer for like conference to Thank to speakers you. the back over concludes This I would session. our closing the any

you, you thank were on joining progress assist. please to call. of we conference ongoing questions, to to our you to and We be reach you like forward unable out earnings our Thank our growth. continuing than any operator. I would update of -- department, happy for more answer IR look also all to your would who to If

website, webcast, in on the and press days you be found may close after progress, webcast of the available sorry, replay reconciliation be a any next link, we non-GAAP all. disclosed regarding the for non-GAAP and this of our filed financial the non-reconciliation -- of can Thank call information information information this of including in and today. financial market financial which the release, for you call will information who remember that under joined For have more of the on call the the NASDAQ-MEDS company's XX

you today's The now has conference attending for presentation. concluded. Thank

day. now a nice disconnect. may Have You