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NextGen Healthcare Reports Fiscal 2022 Fourth Quarter and Full Year Results

5/17/2022 4:05:00 PM

Achieves Record Bookings in the Fiscal 2022 Fourth Quarter

ATLANTA--(BUSINESS WIRE)--May 17, 2022-- NextGen Healthcare, Inc. (Nasdaq: NXGN), a leading provider of innovative, cloud-based healthcare technology solutions, today announced its operating results for the fiscal fourth quarter and year ended March 31, 2022.

Fiscal 2022 Fourth Quarter and Full Year Highlights

  • Total revenue for the fiscal 2022 fourth quarter was $151.3 million compared to $144.2 million for the same period a year ago, or 5% growth. Revenue for the fiscal year ended March 31, 2022 was $596.4 million compared to $556.8 million a year ago.
  • Recurring revenue accounted for 91% of total revenue in the fiscal 2022 fourth quarter, or $137.2 million, growing 6% over the year ago period.
  • Subscription services revenue in the fiscal 2022 fourth quarter generated $42.1 million, or 10% growth over the prior year period, driven by demand for surround solutions.
  • Fiscal 2022 fourth quarter bookings, which reflects annual contract value, was $41.4 million, a recent record for the company, and reflects growth of 18% over fiscal 2021 fourth quarter.
  • Fully diluted net income per share in the fiscal 2022 fourth quarter was $0.01 compared to net loss of $0.01 per share the same period a year ago. Fully diluted net income per share for fiscal year 2022 was $0.02 compared to $0.14 per share a year ago.
  • On a non-GAAP basis, fully diluted earnings per share for the fiscal 2022 fourth quarter was $0.19 compared to $0.21 for the same period a year ago. On a non-GAAP basis, fully diluted earnings per share for fiscal year 2022 was $0.98 compared to $0.98 reported a year ago.

“Fiscal fourth quarter reflects another strong performance driven by broad demand for our solutions and the high level of execution by our team. To better position us for faster revenue growth and operating leverage, we have accelerated the pace of investments in strategic domains – Enterprise, Office and Insights,” said David Sides, President and Chief Executive Officer of NextGen Healthcare. “We are dedicated to our mission of advancing ambulatory care with innovations for healthier communities and at our recent investor event, we provided a view into our exciting future. The company is on a clear path to demonstrate accelerating revenue growth, and we look forward to providing updates as the year progresses.”

NextGen Healthcare confirms its fiscal year 2023 revenue and non-GAAP earnings per share guidance and introduces an adjusted EBITDA range for the same period. The Company’s fiscal year 2023 financial guidance is as follows:

  • Revenue of between $628 million and $640 million
  • Adjusted EBITDA of between $111 million and $116 million
  • Non-GAAP earnings per share of between $0.95 and $1.01

Conference Call Information

NextGen Healthcare will host a conference call today at 5:00 p.m. EST to discuss operating results from its fiscal 2022 fourth quarter and year ended March 31, 2022. Shareholders and interested participants may listen to a live broadcast of the call by dialing 866-831-8713 or 203-518-9822 for international callers and referencing participant code NXGNQ422 approximately 15 minutes prior to the call. A recording of the live webcast will be available on investor.nextgen.com after the call. It will be archived for 90 days.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including but not limited to statements we make regarding our fiscal year 2023 outlook, financial and operating results, strategic priorities, growth initiatives and expected capital expenditures. These forward-looking statements are based on the current beliefs, expectations, and assumptions of the Company's management relating to the future (including, without limitation, statements concerning revenue, net income, and earnings per share). The words “positioned,” “proposed,” “potential,” “project,” “expect,” “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “estimate, “strategy,” “expectations,” “future,” “likely,” “may,” “should,” “will,” variations thereof or similar expressions are intended to identify such forward-looking statements.

Risks and uncertainties exist that may cause the results to differ materially from those set forth in these forward-looking statements, including but not limited to: changes in laws and regulations applicable to our business; changes in market conditions and receptivity to our services and offerings; strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses; our ability to maintain and expand our business with existing clients or effectively transition clients to newer products; our ability to attract new partners and successfully capture new opportunities; our ability to develop and grow partner relationships; our ability to attract and retain key employees; our ability to anticipate or respond quickly to market changes, execute our strategy and manage growth; the impact of litigation and governmental and regulatory agency investigations; the impact of governmental and regulatory agency investigations; the development by competitors of new or superior technologies; the timing, cost and success or failure of new product and service introductions, development and product upgrade releases; the impact of the COVID-19 pandemic on our operations and demand for our services; impact of breaches or failures of the Company’s information security measures or unauthorized access to a customer’s data; disruptions caused by acquisitions of companies, products, or technologies; and general economic conditions. Additional discussion of these and other risks, uncertainties and factors affecting our business is contained in our filings with the SEC, including our most recent Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q.

A significant portion of the Company's quarterly sales of software product licenses and computer hardware is concluded in the last month of a fiscal quarter, generally with a concentration of such revenues earned in the final ten business days of that month. Due to these and other factors, the Company's revenues and operating results are very difficult to forecast. A major portion of the Company's costs and expenses, such as personnel and facilities, are of a fixed nature and, accordingly, a shortfall or decline in quarterly and/or annual revenues typically results in lower profitability or losses. As a result, comparison of the Company's period-to-period financial performance is not necessarily meaningful and should not be relied upon as an indicator of future performance. These forward-looking statements speak only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

USE OF NON-GAAP FINANCIAL MEASURES

This news release contains certain non-GAAP (Generally Accepted Accounting Principles) financial measures, which are provided only as supplemental information. Investors should consider these non-GAAP financial measures only in conjunction with the comparable GAAP financial measures. These non-GAAP measures are not in accordance with or a substitute for U.S. GAAP. Pursuant to the requirements of Regulation G, the Company has provided a reconciliation of non-GAAP financial measures to the most directly comparable financial measure in the accompanying financial tables. Other companies may calculate non-GAAP measures differently than NextGen Healthcare, Inc., which limits comparability between companies. The Company believes that its presentation of non-GAAP diluted earnings per share provides useful supplemental information to investors and management regarding the Company's financial condition and results. The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP.

The Company calculates non-GAAP diluted earnings per share by excluding net acquisition costs, amortization of acquired intangible assets, amortization of deferred debt issuance costs, impairment of assets, restructuring costs, shareholder disputes and related costs, net of insurance, which include net securities litigation defense, proxy contest, and related costs, share-based compensation, and other non-run-rate expenses from GAAP income before provision for income taxes.

The Company utilizes a normalized non-GAAP tax rate to provide better consistency across the interim reporting periods within a given fiscal year by eliminating the effects of non-recurring and period-specific items, which can vary in size and frequency, and which are not necessarily reflective of the Company’s longer-term operations. The normalized non-GAAP tax rate applied to each quarter of fiscal year 2022 was 20.0%. The determination of this rate is based on the consideration of both historic and projected financial results. The Company may adjust its non-GAAP tax rate as additional information becomes available and in conjunction with any other significant events occur that may materially affect this rate, such as merger and acquisition activity, changes in business outlook, or other changes in expectations regarding tax regulations.

The Company calculates free cash flow as total net cash provided by operating activities, net of cash used for the additions of capitalized software costs and equipment and improvements. The Company calculates net debt as line of credit less cash and cash equivalents. The Company calculates non-GAAP adjusted EBITDA by excluding net acquisition costs, amortization of acquired intangible assets, impairment of assets, restructuring costs, shareholder disputes and related costs, net of insurance, which include net securities litigation defense, proxy contest, and related costs, share-based compensation, and other non-run-rate expenses from GAAP income from operations and then adding back amortization of capitalized software costs and depreciation as presented within the condensed consolidated statements of cash flows. Non-GAAP adjusted EBITDA margin is calculated as non-GAAP adjusted EBITDA divided by total revenues. The Company calculates Rule of 40 as annual revenue growth rate plus non-GAAP adjusted EBITDA margin.

The Company’s future period guidance in this release includes adjustments for items not indicative of the Company’s core operations. Such adjustments are generally expected to be of a nature similar to those adjustments applied to the Company’s historic GAAP financial results in the determination of the Company’s non-GAAP diluted earnings per share. Such adjustments, however, may be affected by changes in ongoing assumptions and judgments as to the items that are excluded in the calculation of non-GAAP adjusted net income and adjusted diluted earnings per share, as described in this release. The exact amount and probable significance of these adjustments, including net acquisition costs, impairment of assets, restructuring costs, shareholder disputes and related costs, which include net securities litigation defense, proxy contest, and related costs, and other non-run-rate expenses, are not currently determinable without unreasonable efforts, but may be significant. These items cannot be reliably quantified or forecasted due to the combination of their historic and expected variability. It is therefore not practicable to reconcile this non-GAAP guidance to the most comparable GAAP measures.

About NextGen Healthcare, Inc.

NextGen Healthcare, Inc. (Nasdaq: NXGN) is a leading provider of innovative technology solutions. We are reimagining ambulatory healthcare with award-winning solutions that enable high-performing practices to create healthier communities. We partner with medical, behavioral and dental providers in their journey toward whole person health and value-based care. Our highly integrated, intelligent and interoperable solutions go beyond EHR and Practice Management to increase clinical quality and productivity, enrich the patient experience and drive superior financial performance. We are on a quest to achieve better healthcare outcomes for all. Learn more at nextgen.com, and follow us on Facebook, Twitter, LinkedIn, YouTube and Instagram.

NEXTGEN HEALTHCARE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

 

 

Three Months

Ended March 31,

 

Fiscal Year

Ended March 31,

 

2022

 

2021

 

2022

 

2021

Revenues:

 

 

 

 

 

 

 

 

 

 

 

Recurring

$

137,227

 

 

$

129,363

 

 

$

539,713

 

 

$

502,819

 

Software, hardware, and other non-recurring

 

14,032

 

 

 

14,825

 

 

 

56,637

 

 

 

54,002

 

Total revenues

 

151,259

 

 

 

144,188

 

 

 

596,350

 

 

 

556,821

 

Cost of revenue:

 

 

 

 

 

 

 

 

 

 

 

Recurring

 

60,169

 

 

 

54,660

 

 

 

232,481

 

 

 

212,199

 

Software, hardware, and other non-recurring

 

7,949

 

 

 

7,533

 

 

 

31,034

 

 

 

26,457

 

Amortization of capitalized software costs and acquired intangible assets

 

7,643

 

 

 

7,588

 

 

 

31,889

 

 

 

36,768

 

Total cost of revenue

 

75,761

 

 

 

69,781

 

 

 

295,404

 

 

 

275,424

 

Gross profit

 

75,498

 

 

 

74,407

 

 

 

300,946

 

 

 

281,397

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

50,046

 

 

 

48,870

 

 

 

209,661

 

 

 

180,529

 

Research and development costs, net

 

19,428

 

 

 

21,390

 

 

 

76,657

 

 

 

75,501

 

Amortization of acquired intangible assets

 

882

 

 

 

1,113

 

 

 

3,525

 

 

 

4,449

 

Impairment of assets

 

2,329

 

 

 

3,324

 

 

 

3,906

 

 

 

5,539

 

Restructuring costs

 

 

 

 

 

 

 

539

 

 

 

2,562

 

Total operating expenses

 

72,685

 

 

 

74,697

 

 

 

294,288

 

 

 

268,580

 

Income (loss) from operations

 

2,813

 

 

 

(290

)

 

 

6,658

 

 

 

12,817

 

Interest income

 

22

 

 

 

11

 

 

 

101

 

 

 

38

 

Interest expense

 

(541

)

 

 

(643

)

 

 

(1,499

)

 

 

(3,516

)

Other expense, net

 

(21

)

 

 

(47

)

 

 

(64

)

 

 

(64

)

Income (loss) before provision for (benefit of) income taxes

 

2,273

 

 

 

(969

)

 

 

5,196

 

 

 

9,275

 

Provision for (benefit of) income taxes

 

1,925

 

 

 

(389

)

 

 

3,578

 

 

 

(240

)

Net income (loss):

$

348

 

 

$

(580

)

 

$

1,618

 

 

$

9,515

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.01

 

 

$

(0.01

)

 

$

0.02

 

 

$

0.14

 

Diluted

$

0.01

 

 

$

(0.01

)

 

$

0.02

 

 

$

0.14

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

66,929

 

 

 

67,029

 

 

 

67,370

 

 

 

66,739

 

Diluted

 

67,547

 

 

 

67,919

 

 

 

67,788

 

 

 

66,885

 

NEXTGEN HEALTHCARE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(Unaudited)

 

 

 

March 31, 2022

 

March 31, 2021

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

59,829

 

 

$

73,295

 

Restricted cash and cash equivalents

 

 

6,918

 

 

 

5,280

 

Accounts receivable, net

 

 

76,057

 

 

 

77,541

 

Contract assets

 

 

25,157

 

 

 

19,481

 

Income taxes receivable

 

 

6,507

 

 

 

765

 

Prepaid expenses and other current assets

 

 

37,102

 

 

 

31,282

 

Total current assets

 

 

211,570

 

 

 

207,644

 

Equipment and improvements, net

 

 

9,120

 

 

 

14,539

 

Capitalized software costs, net

 

 

43,958

 

 

 

41,474

 

Operating lease assets

 

 

11,316

 

 

 

18,446

 

Deferred income taxes, net

 

 

19,259

 

 

 

19,474

 

Contract assets, net of current

 

 

1,910

 

 

 

1,976

 

Intangibles, net

 

 

24,303

 

 

 

36,700

 

Goodwill

 

 

267,212

 

 

 

267,212

 

Other assets

 

 

39,026

 

 

 

37,021

 

Total assets

 

$

627,674

 

 

$

644,486

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

9,125

 

 

$

11,378

 

Contract liabilities

 

 

61,280

 

 

 

52,863

 

Accrued compensation and related benefits

 

 

48,736

 

 

 

50,374

 

Income taxes payable

 

 

99

 

 

 

584

 

Operating lease liabilities

 

 

8,089

 

 

 

12,735

 

Other current liabilities

 

 

53,533

 

 

 

52,699

 

Total current liabilities

 

 

180,862

 

 

 

180,633

 

Deferred compensation

 

 

7,230

 

 

 

6,620

 

Operating lease liabilities, net of current

 

 

11,934

 

 

 

18,453

 

Other noncurrent liabilities

 

 

4,570

 

 

 

7,136

 

Total liabilities

 

 

204,596

 

 

 

212,842

 

Commitments and contingencies

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

Common stock, $0.01 par value; authorized 100,000 shares; 69,245 and 67,069 shares issued at March 31, 2022 and March 31, 2021, respectively; 67,075 and 67,069 shares outstanding at March 31, 2022 and March 31, 2021, respectively

 

 

692

 

 

 

671

 

Treasury stock, at cost, 2,170 shares at March 31, 2022

 

 

(35,874

)

 

 

 

Additional paid-in capital

 

 

329,917

 

 

 

304,263

 

Accumulated other comprehensive loss

 

 

(1,909

)

 

 

(1,924

)

Retained earnings

 

 

130,252

 

 

 

128,634

 

Total shareholders' equity

 

 

423,078

 

 

 

431,644

 

Total liabilities and shareholders' equity

 

$

627,674

 

 

$

644,486

NEXTGEN HEALTHCARE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

Three Months
Ended March 31,

 

Fiscal Year
Ended March 31,

 

2022

 

2021

 

2022

 

2021

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

348

 

 

$

(580

)

 

$

1,618

 

 

$

9,515

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

Amortization of capitalized software costs

 

5,424

 

 

 

5,280

 

 

 

23,016

 

 

 

20,108

 

Amortization and write-off of debt issuance costs

 

127

 

 

 

494

 

 

 

508

 

 

 

1,026

 

Amortization of other intangibles

 

3,099

 

 

 

3,421

 

 

 

12,397

 

 

 

21,109

 

Change in fair value of contingent consideration

 

 

 

 

(1,442

)

 

 

7

 

 

 

(1,367

)

Deferred income taxes

 

180

 

 

 

(8,812

)

 

 

215

 

 

 

(8,854

)

Depreciation

 

1,496

 

 

 

1,909

 

 

 

6,902

 

 

 

7,997

 

Excess tax deficiency (benefit) from share-based compensation

 

(191

)

 

 

(72

)

 

 

643

 

 

 

798

 

Impairment of assets

 

2,329

 

 

 

3,324

 

 

 

3,906

 

 

 

5,539

 

Loss on disposal of equipment and improvements

 

20

 

 

 

(15

)

 

 

97

 

 

 

12

 

Non-cash operating lease costs

 

1,277

 

 

 

1,633

 

 

 

5,732

 

 

 

6,786

 

Provision for bad debts

 

773

 

 

 

790

 

 

 

1,915

 

 

 

2,834

 

Share-based compensation

 

7,867

 

 

 

5,947

 

 

 

26,552

 

 

 

22,710

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

(6,750

)

 

 

(1,590

)

 

 

(431

)

 

 

(369

)

Contract assets

 

(824

)

 

 

(1,863

)

 

 

(5,610

)

 

 

(5,921

)

Accounts payable

 

(5,921

)

 

 

3,410

 

 

 

(2,329

)

 

 

615

 

Contract liabilities

 

6,401

 

 

 

4,208

 

 

 

8,417

 

 

 

(3,923

)

Accrued compensation and related benefits

 

6,717

 

 

 

10,372

 

 

 

(1,638

)

 

 

26,582

 

Income taxes

 

1,564

 

 

 

5,109

 

 

 

(5,650

)

 

 

1,615

 

Deferred compensation

 

(441

)

 

 

(4

)

 

 

610

 

 

 

1,320

 

Operating lease liabilities

 

(2,672

)

 

 

(6,693

)

 

 

(12,734

)

 

 

(16,736

)

Other assets and liabilities

 

(3,914

)

 

 

(2,286

)

 

 

(10,598

)

 

 

7,122

 

Net cash provided by operating activities

 

16,909

 

 

 

22,540

 

 

 

53,545

 

 

 

98,518

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

Additions to capitalized software costs

 

(7,663

)

 

 

(5,664

)

 

 

(25,500

)

 

 

(24,578

)

Additions to equipment and improvements

 

(545

)

 

 

(2,215

)

 

 

(2,582

)

 

 

(3,761

)

Acquisition related working capital adjustment payments

 

 

 

 

 

 

 

 

 

 

(206

)

Net cash used in investing activities

 

(8,208

)

 

 

(7,879

)

 

 

(28,082

)

 

 

(28,545

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

Proceeds from line of credit

 

 

 

 

 

 

 

 

 

 

50,000

 

Repayments on line of credit

 

 

 

 

(29,000

)

 

 

 

 

 

(179,000

)

Payment of debt issuance costs

 

 

 

 

(1,423

)

 

 

 

 

 

(1,423

)

Payment of contingent consideration related to acquisitions

 

 

 

 

 

 

 

(540

)

 

 

 

Proceeds from issuance of shares under employee plans

 

4,137

 

 

 

1,482

 

 

 

5,014

 

 

 

3,479

 

Repurchase of common stock

 

 

 

 

 

 

 

(35,874

)

 

 

 

Payments for taxes related to net share settlement of equity awards

 

(441

)

 

 

(876

)

 

 

(5,891

)

 

 

(4,773

)

Net cash provided by (used in) financing activities

 

3,696

 

 

 

(29,817

)

 

 

(37,291

)

 

 

(131,717

)

Net increase (decrease) in cash, cash equivalents, and restricted cash

 

12,397

 

 

 

(15,156

)

 

 

(11,828

)

 

 

(61,744

)

Cash, cash equivalents, and restricted cash at beginning of period

 

54,350

 

 

 

93,731

 

 

 

78,575

 

 

 

140,319

 

Cash, cash equivalents, and restricted cash at end of period

$

66,747

 

 

$

78,575

 

 

$

66,747

 

 

$

78,575

 

NEXTGEN HEALTHCARE, INC.

SUPPLEMENTAL FINANCIAL INFORMATION

(In thousands)

 

The following table presents our revenues disaggregated by our major revenue categories and by occurrence:

 

Three Months
Ended March 31,

 

 

Fiscal Year
Ended March 31,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Recurring revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subscription services

$

42,055

 

 

$

38,218

 

 

$

162,636

 

 

$

148,403

 

Support and maintenance

 

39,887

 

 

 

38,419

 

 

 

155,623

 

 

 

152,956

 

Managed services

 

28,924

 

 

 

27,032

 

 

 

116,722

 

 

 

103,138

 

Electronic data interchange and data services

 

26,361

 

 

 

25,694

 

 

 

104,732

 

 

 

98,322

 

Total recurring revenues

 

137,227

 

 

 

129,363

 

 

 

539,713

 

 

 

502,819

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software, hardware, and other non-recurring revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Software license and hardware

 

7,145

 

 

 

8,163

 

 

 

31,347

 

 

 

28,825

 

Other non-recurring services

 

6,887

 

 

 

6,662

 

 

 

25,290

 

 

 

25,177

 

Total software, hardware and other non-recurring revenues

 

14,032

 

 

 

14,825

 

 

 

56,637

 

 

 

54,002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

$

151,259

 

 

$

144,188

 

 

$

596,350

 

 

$

556,821

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring revenues as a percentage of total revenues

 

90.7

%

 

 

89.7

%

 

 

90.5

%

 

 

90.3

%

NEXTGEN HEALTHCARE, INC.

NON-GAAP FINANCIAL MEASURES

(In thousands, except per share data)

 

RECONCILIATION OF NON-GAAP DILUTED EARNINGS PER SHARE

 

Three Months

Ended March 31,

 

Fiscal Year

Ended March 31,

 

2022

 

2021

 

2022

 

2021

Income before provision for income taxes - GAAP

$

2,273

 

$

(969

)

 

$

5,196

 

$

9,275

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

Acquisition costs, net

 

 

 

(1,409

)

 

 

 

 

(1,029

)

Amortization of acquired intangible assets

 

3,099

 

 

3,421

 

 

 

12,397

 

 

21,109

 

Amortization of deferred debt issuance costs

 

127

 

 

494

 

 

 

508

 

 

1,026

 

Impairment of assets

 

2,329

 

 

3,324

 

 

 

3,906

 

 

5,539

 

Restructuring costs

 

 

 

 

 

 

539

 

 

2,562

 

Shareholder disputes and related costs, net of insurance

 

531

 

 

6,060

 

 

 

29,747

 

 

16,274

 

Share-based compensation

 

7,867

 

 

5,947

 

 

 

26,552

 

 

22,710

 

Other non-run-rate expenses*

 

107

 

 

620

 

 

 

4,486

 

 

4,754

 

Total adjustments to GAAP income before provision for income taxes:

 

14,060

 

 

18,457

 

 

 

78,135

 

 

72,945

 

Income before provision for income taxes - Non-GAAP

 

16,333

 

 

17,488

 

 

 

83,331

 

 

82,220

 

Provision for income taxes

 

3,266

 

 

3,498

 

 

 

16,666

 

 

16,444

 

Net income - Non-GAAP

$

13,067

 

$

13,990

 

 

$

66,665

 

$

65,776

 

Diluted net income per share - Non-GAAP

$

0.19

 

$

0.21

 

 

$

0.98

 

$

0.98

 

Weighted-average shares outstanding (diluted):

 

67,547

 

 

67,919

 

 

 

67,788

 

 

66,885

 

 

 

 

 

 

 

 

 

 

 

 

 

* Other non-run-rate expenses for the three months ended March 31, 2022 consist of $107 excess lease-related expense for vacated facilities.

 

Other non-run-rate expenses for the three months ended March 31, 2021 consist primarily of $552 excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses and severance expense, related to the restructuring plan and $68 of professional services costs not related to core operations.

 

Other non-run-rate expenses for the year ended March 31, 2022 consist primarily of $1,242 excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses, related to the restructuring plan and $2,707 of executive transition costs, including severance and other costs related to the departure of the CEO, $498 of incremental costs and penalties primarily due to the cancellation of certain events directly associated with the COVID-19 pandemic, and $39 of professional services costs not related to core operations.

 

Other non-run-rate expenses for the year ended March 31, 2021 consist primarily of $3,183 excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses and severance expense, related to the restructuring plan, $1,472 of professional services costs not related to core operations, and $99 of incremental costs and penalties primarily due to the cancellation of certain events directly associated with the COVID-19 pandemic.

 

RECONCILIATION OF FREE CASH FLOW

 

Three Months
Ended March 31,

 

Fiscal Year
Ended March 31,

 

2022

 

2021

 

2022

 

2021

Net cash provided by operating activities

$

16,909

 

 

$

22,540

 

 

$

53,545

 

 

$

98,518

 

Additions to capitalized software costs

 

(7,663

)

 

 

(5,664

)

 

 

(25,500

)

 

 

(24,578

)

Additions to equipment and improvements

 

(545

)

 

 

(2,215

)

 

 

(2,582

)

 

 

(3,761

)

Free cash flow

$

8,701

 

 

$

14,661

 

 

$

25,463

 

 

$

70,179

 

NEXTGEN HEALTHCARE, INC.

NON-GAAP FINANCIAL MEASURES

(In thousands)

 

RECONCILIATION OF ADJUSTED EBITDA

 

Three Months
Ended March 31,

 

Fiscal Year
Ended March 31,

 

2022

 

2021

 

2022

 

2021

Income (loss) from operations - GAAP

$

2,813

 

 

$

(290

)

 

$

6,658

 

 

$

12,817

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

Acquisition costs, net

 

 

 

 

(1,409

)

 

 

 

 

 

(1,029

)

Amortization of acquired intangible assets

 

3,099

 

 

 

3,421

 

 

 

12,397

 

 

 

21,109

 

Impairment of assets

 

2,329

 

 

 

3,324

 

 

 

3,906

 

 

 

5,539

 

Restructuring costs

 

 

 

 

 

 

 

539

 

 

 

2,562

 

Shareholder disputes and related costs, net of insurance

 

531

 

 

 

6,060

 

 

 

29,747

 

 

 

16,274

 

Share-based compensation

 

7,867

 

 

 

5,947

 

 

 

26,552

 

 

 

22,710

 

Other non-run-rate expenses*

 

107

 

 

 

620

 

 

 

4,486

 

 

 

4,754

 

Total adjustments to GAAP income (loss) from operations:

 

13,933

 

 

 

17,963

 

 

 

77,627

 

 

 

71,919

 

Income from operations - Non-GAAP

 

16,746

 

 

 

17,673

 

 

 

84,285

 

 

 

84,736

 

Amortization of capitalized software costs

 

5,424

 

 

 

5,280

 

 

 

23,016

 

 

 

20,108

 

Depreciation

 

1,496

 

 

 

1,909

 

 

 

6,902

 

 

 

7,997

 

Depreciation and Amortization - Non-GAAP

 

6,920

 

 

 

7,189

 

 

 

29,918

 

 

 

28,105

 

Adjusted EBITDA - Non-GAAP

$

23,666

 

 

$

24,862

 

 

$

114,203

 

 

$

112,841

 

Total revenues

$

151,259

 

 

$

144,188

 

 

$

596,350

 

 

$

556,821

 

Adjusted EBITDA margin - Non-GAAP

 

15.6

%

 

 

17.2

%

 

 

19.2

%

 

 

20.3

%

* Other non-run-rate expenses for the three months ended March 31, 2022 consist of $107 excess lease-related expense for vacated facilities.

 

Other non-run-rate expenses for the three months ended March 31, 2021 consist primarily of $552 excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses and severance expense, related to the restructuring plan and $68 of professional services costs not related to core operations.

 

Other non-run-rate expenses for the year ended March 31, 2022 consist primarily of $1,242 excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses, related to the restructuring plan and $2,707 of executive transition costs, including severance and other costs related to the departure of the CEO, $498 of incremental costs and penalties primarily due to the cancellation of certain events directly associated with the COVID-19 pandemic, and $39 of professional services costs not related to core operations.

 

Other non-run-rate expenses for the year ended March 31, 2021 consist primarily of $3,183 excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses and severance expense, related to the restructuring plan, $1,472 of professional services costs not related to core operations, and $99 of incremental costs and penalties primarily due to the cancellation of certain events directly associated with the COVID-19 pandemic.

A reconciliation of adjusted EBITDA for each interim reporting period within the fiscal years ended March 31, 2022 and 2021 may be accessed through our Investor Relations website at http://investor.nextgen.com.

Media Relations Contact
Tami Andrade
(949) 237-6083
tandrade@nextgen.com

Investor Relations Contact
Matthew Scalo
(415) 370-9202
mscalo@nextgen.com

Source: NextGen Healthcare, Inc.