• HEALWELL AI achieved annual revenue from continuing operations of $7.32 million in fiscal 2023. HEALWELL ended 2023 with a strong balance sheet, having secured approximately $29.5 million from convertible debt and equity financings.
• Since its relaunch in Q4 2023, the Company’s annual revenue run rate has more than doubled to over $20M with the largest component of revenues now coming from SaaS and services.
• Management provides a positive outlook based on strong and active acquisition and business development pipeline with the potential to more than double HEALWELL’s yearly revenue run-rate to over $40 million using the Company’s existing cash on hand.
• HEALWELL’s strategic alliance with equity investor WELL Health Technologies Inc. continues to flourish with significant activity in both Canada and the United States. In Canada, WELL Health recently launched WELL AI Decision Support an AI-powered physician copilot providing clinical decision support for rare disease diagnosis and preventative care. WELL is sourcing this technology entirely from HEALWELL.

TORONTO, March 28, 2024 (GLOBE NEWSWIRE) -- HEALWELL AI Inc. (“HEALWELL” or the “Company”) (TSX: AIDX) (OTCQX: HWAIF), (formerly known as MCI Onehealth Technologies Inc.), a healthcare technology company focused on AI and data science for preventative care, is pleased to announce its audited consolidated financial results for the fiscal year and fourth quarter ended December 31, 2023.

Dr. Alexander Dobranowski, HEALWELL’s CEO, commented, “Fourth quarter was a transformative period for the Company marked by our relaunch as HEALWELL AI and our new mission to improve healthcare and save lives through early disease detection with the use of leading AI and data science technologies. In the quarter, we achieved significant milestones including the establishment of a groundbreaking partnership with WELL Health Technologies, securing approximately $29.5 million through convertible debt and equity financings, and completing the acquisition of a majority interest in Pentavere, one of the leading healthcare AI platforms in Canada. I am grateful for what our team has been able to accomplish in such a short amount of time and excited with our continued trajectory as we show no signs of slowing down.”

Dr. Dobranowski further adds, “We have an extremely positive outlook based on our organic growth profile and M&A strategy. We currently have a strong and active acquisition pipeline with the potential to more than double our current revenue run-rate of over $20 million to over $40 million per year, by using the existing cash we have on hand. We’ve established a very strong foundation with a solid framework for HEALWELL’s continued growth. Other significant areas of focus include onboarding more physicians onto the HEALWELL platform, increasing sales of our AI tools and technology, expanding Intrahealth’s footprint, and enhancing our presence within the WELL Health ecosystem. We see an unparalleled opportunity in healthcare data science and artificial intelligence.”

Scott Nirenberski, HEALWELL’s CFO, commented, “During the fourth quarter HEALWELL significantly strengthened its balance sheet by raising a total of $29.5 million of debt and equity and discharging a number of significant secured and unsecured liabilities. Our 2023 results are not indicative of the Company’s current run-rate revenues as the Intrahealth acquisition was made in Q1-2024 and this is expected to contribute over $12 million in revenue and contribute positive EBITDA to HEALWELL this year. Furthermore, the 2023 results only included one month of contribution from our Pentavere acquisition. Looking ahead, we expect to see improved top and bottom-line performance as we activate against our advanced business development and M&A pipeline.”

A summary of the Company’s financial and operational results is set out below, and more detailed information is contained in the annual financial statements and related management discussion and analysis, which are available on the Company’s SEDAR+ page at www.sedarplus.com. Financial measures described as “Adjusted” in this news release are non-IFRS financial measures and may not be comparable to other similar measures disclosed by other companies. Please see Non-IFRS Financial Measures below for more information.

Fiscal 2023 Annual Financial Highlights:

Significant financial highlights for the Company’s continuing operations during the year ended December 31, 2023 included:

• HEALWELL achieved annual revenue from continuing operations of $7.32 million during 2023, compared to $10.42 million for the same period of 2022.
• HEALWELL achieved Adjusted Gross Profit⁽²⁾ of $2.02 million in 2023, compared to $4.34 million in 2022.
• HEALWELL achieved an Adjusted Gross Margin⁽²⁾ percentage of 28% during 2023 compared to 42% in 2022.
• During fiscal 2023, HEALWELL reported Adjusted EBITDA⁽¹⁾ loss of $7.95 million, compared to an Adjusted EBITDA loss of $9.67 million in 2022.

Fourth Quarter 2023 Financial Highlights

Significant financial highlights for the Company’s continuing operations during the three months ended December 31, 2023 included:

• HEALWELL achieved quarterly revenue from continuing operations of $1.92 million during Q4-2023, compared to $3.04 million generated in Q4-2022.
• HEALWELL achieved Adjusted Gross Profit⁽²⁾ of $0.56 million during Q4-2023, compared to $1.73 million in Q4-2022.
• HEALWELL achieved an Adjusted Gross Margin⁽²⁾ percentage of 29% during Q4-2023, compared to 57% in Q4-2022.
• During Q4-2023, HEALWELL reported Adjusted EBITDA⁽¹⁾ loss of $1.46 million, compared to a loss of $1.80 million in Q4-2022.
• As at December 31, 2023, HEALWELL had $19.16 million in cash, compared to $1.41 million as at December 31, 2022.
  
  

Fourth Quarter 2023 Business and Operational Highlights

Significant business and operational highlights for the Company during the three months ended December 31, 2023 included:

• Completion of Strategic Transaction: On October 2, 2023, the Company announced the closing of the Strategic Transaction with WELL and re-launched as an AI and data science focused healthcare technology business. The transaction significantly strengthened HEALWELL’s balance sheet by: (1) completing a convertible debenture unit financing for gross proceeds of $10 million led by WELL and a syndicate of investors, and (2) discharging certain secured debt obligations of the Company. HEALWELL and WELL also established a strategic alliance that positions HEALWELL to become a significant player in the multi-billion-dollar data sciences and preventative care industry. HEALWELL expanded its board and management team with several new additions including the appointment of Hamed Shahbazi, Chairman and CEO of WELL, to the board of HEALWELL.
  
  
• Bought Deal Financing:   On October 17, 2023, the Company closed a bought deal private placement financing of 13,333,400 Class A subordinate voting shares of the Company (the “Subordinate Voting Shares”) at a price of $0.60 per Subordinate Voting Share, for aggregate gross proceeds of $8,000,040.
  
  
• WELL AI Decision Support: On October 18, 2023, HEALWELL announced the launch of WELL AI Decision Support, an AI-powered clinical decision support tool that acts as a rare disease physician co-pilot that assists WELL’s care providers with early disease diagnosis and preventative health. WELL's goal is to make AI Enabled Decision Support a core offering to all physicians supported by its fully managed and SaaS platforms which collectively power more than 31,000 physicians and other care providers across Canada and the US.
  
  
• Doctorly Investment: On November 8, 2023, HEALWELL announced a strategic investment in doctorly GmbH (“doctorly”), an innovative provider of comprehensive practice management software based in Germany as part of doctorly’s recently completed new round of funding. Concurrently, HEALWELL has also entered into a Strategic Alliance Agreement with doctorly which provides HEALWELL with access to doctorly’s rapidly growing healthcare provider base and support for provider onboarding onto the HEALWELL clinical decision support platform. This partnership marks HEALWELL’s inaugural foray into the European healthcare technology landscape.
  
  
• OTCQX Trading & DTC Eligibility: On November 21, 2023, HEALWELL announced its commencement of trading on the OTCQX Best Market under the ticker symbol "HWAIF" and received DTC eligibility for its Subordinate Voting Shares. The OTCQX listing follows stringent criteria, ensuring compliance with financial standards and corporate governance best practices. Additionally, there will be no change to HEALWELL's trading under its Toronto Stock Exchange symbol "AIDX."
  
  
• Pentavere Acquisition: On December 4, 2023, HEALWELL announced that it had completed the acquisition of a majority stake of Pentavere Research Group Inc. (“Pentavere”), a healthcare artificial intelligence (AI) company who has built a best-in-class AI engine to help solve some of healthcare’s toughest data challenges. Pentavere has developed and validated leading capabilities in data structuring and abstraction; a key capability to unlocking clinical value and unmet needs for patients and providers. This acquisition adds new high margin technology revenue, access to multiple new key pharmaceutical company and life sciences customers, new products, partnerships with major hospital networks in Canada and the United States, as well as an experienced and sophisticated AI engineering team.
  
  
• Bought Deal Financing: On December 22, 2023, the Company closed a bought deal public offering financing of 14,375,000 units of the Company (the “Units”) at a price of $0.80 per Unit, for aggregate gross proceeds of $11,500,000. Each Unit is comprised of one Subordinate Voting Share and one-half of one Subordinate Voting Share purchase warrant (each whole warrant, a “Warrant”) of the Company. Each Warrant entitles the holder thereof to purchase one additional Subordinate Voting Share at an exercise price of $1.20 for a period of three (3) years following the closing of the offering.

Events Subsequent to December 31, 2023

Significant business and operational highlights for the Company subsequent to December 31, 2023 included:

• Intrahealth Acquisition: On February 1, 2024, HEALWELL announced that it had completed the acquisition of Intrahealth Systems Limited (“Intrahealth”), a former subsidiary of WELL. Intrahealth is an advanced SaaS based Electronic Health Records (“EHR”) management platform for small and medium enterprise healthcare organizations across Canada, Australia, and New Zealand. Intrahealth is expected to generate over $12 million in revenues in 2024, which reflects double digit organic growth. Historically, Intrahealth has achieved over 80% gross margins, produced positive EBITDA, and positive cashflows. Over 80% of its revenue is high margin recurring revenue. HEALWELL’s plan is to deeply integrate its industry leading AI tools with Intrahealth and help create a next generation AI Powered EHR to significantly amplify the effectiveness of healthcare providers and allow them to drive better health outcomes at lower costs in a manner aligned with global Value Based Care (VBC) trends.
  
  
• Chairman of the Board Appointment: On February 27, 2024, the Company announced the appointment of Hamed Shahbazi as Chairman of the Board of HEALWELL. Mr. Hamed Shahbazi is currently the Chairman and CEO of WELL, Canada's largest owner operator of outpatient medical clinics and leading digital health service providing software and services to more than one third of all Canadian physicians. Mr. Shahbazi has served on the Board of HEALWELL since its launch on October 1, 2023. Concurrent to Mr. Shahbazi’s appointment, Mr. Kingsley Ward stepped down from HEALWELL’s Chairman position but continues to serve as an Independent Director on HEALWELL’s board.
  
  
• WELL USA and Circle Medical Partnership: On March 14, 2024, HEALWELL AI Inc. announced new commercial agreements with WELL Health USA and Circle Medical, expanding into the US market. This follows the company's strategic transaction with WELL on October 1, 2023, where it re-launched as an AI and data science-focused healthcare technology business. The agreements will allow HEALWELL to provide US patients with access to its subsidiaries Pentavere and Khure Health for the purposes of earlier diagnosis and identification of patients with potential risks of certain conditions.

Webcast and Conference Call Details:

As previously announced, HEALWELL will be holding a conference call and simultaneous webcast to discuss its financial results on Thursday March 28, 2024 at 1:00 pm EDT (10:00 am PDT). The call will be hosted by Dr. Alexander Dobranowski, Chief Executive Officer, and Scott Nirenberski, Chief Financial Officer. Please dial-in 10 minutes prior to the start of the call.

Date: Thursday, March 28, 2024
Time: 1:00 PM ET / 10:00 AM PT

For attendees who wish to join by webcast, the event can be accessed at: https://edge.media-server.com/mmc/p/kh2csfpp

Attendees who wish to join by phone must click here and pre-register.

Selected Financial Information

(in thousands of dollars, except percentages and per share amounts)

(1)   Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA and Adjusted EBITDA Margin are non-IFRS measures. Please see “Non-IFRS Measures” above for an explanation of the composition of these measures and their usefulness, and “Reconciliation of Non-IFRS Measures” below for a reconciliation of these measures to the IFRS measures found in the Financial Statements.

Selected Statement of Financial Position Data

Non-IFRS Financial Measures

The terms Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Gross Profit and Adjusted Gross Margin used in this document do not have any standardized meaning under IFRS, may not be comparable to similar financial measures disclosed by other companies and should not be considered a substitute for, or superior to, IFRS financial measures. Readers are advised to review the section entitled “Non-IFRS Financial Measures” in the Company’s management discussion and analysis for the quarter and year ended December 31, 2023, available on the Company’s SEDAR+ page at www.sedarplus.com, for a detailed explanation of the composition of these measures and their uses.

(1) The following table reconciles Adjusted EBITDA and Adjusted EBITDA Margin to net income (loss) for the three-months and fiscal year ended December 31, 2023 and December 31, 2022:

(2) The following table reconciles Adjusted Gross Profit and Adjusted Gross Margin to revenue and cost of sales for the three-months ended and fiscal year ended December 31, 2023 and December 31, 2022:

Dr. Alexander Dobranowski

Chief Executive Officer
HEALWELL AI Inc.

About HEALWELL

HEALWELL is a healthcare technology company focused on AI and data science for preventative care. Its mission is to improve healthcare and save lives through early identification and detection of disease. Using its own proprietary technology, the Company is developing and commercializing advanced clinical decision support systems that can help healthcare providers detect rare and chronic diseases, improve efficiency of their practice and ultimately help improve patient health outcomes. HEALWELL is executing a strategy centered around developing and acquiring technology and clinical sciences capabilities that complement the Company's road map. HEALWELL is publicly traded on the Toronto Stock Exchange (the “TSX”) under the symbol “AIDX” and on the OTC Exchange under the symbol “HWAIF”. To learn more about HEALWELL, please visit https://healwell.ai/.

Forward Looking Statements

Certain statements in this press release, constitute “forward-looking information” and “forward looking statements” (collectively, “forward looking statements”) within the meaning of applicable Canadian securities laws and are based on assumptions, expectations, estimates and projections as of the date of this press release. Forward-looking statements include statements with respect to the Company’s acquisition pipeline, its plans and strategies for achieving organic growth, its intention to integrate AI tools into its other service offerings, and the anticipated performance of the Company and its subsidiaries in 2024, including potential revenue growth and changes to Adjusted EBITDA.. The words “result”, “improve”, “grow”, “outcome”, “position”, “implement”, “provide”, “satisfy”, “goal”, “commitment”, “intend”, “generate”, “accelerate”, “continuing to”, “potential”, “future”, “result in”, “increasing”, “anticipates”, “expecting”, “achieve”, “revolutionize”, “transform”, “outlook”, “solidified”, or variations of such words and phrases or statements that certain future conditions, actions, events or results “will”, “may”, “could”, “would”, “should”, “might” or “can”, or negative versions thereof, “occur”, “continue” or “be achieved”, and other similar expressions, identify forward-looking statements. Forward-looking statements are necessarily based upon management’s perceptions of historical trends, current conditions and expected future developments, as well as a number of specific factors and assumptions that, while considered reasonable by the Company as of the date of such statements, are outside of the Company's control and are inherently subject to significant business, economic and competitive uncertainties and contingencies which could result in the forward-looking statements ultimately being entirely or partially incorrect or untrue. Forward looking statements contained in this press release are based on various assumptions, including, but not limited to, the following: the Company's ability to maintain its relationships with its commercial partners and to successfully implement its strategic alliance with WELL; the Company's future access to debt and equity financing; the Company's plans for future cost reduction; the availability of working capital and sources of liquidity; the Company's ability to achieve its growth and revenue strategies; the availability of potential acquisition targets, the Company’s ability to complete acquisitions successfully, and the terms on which acquisitions may be completed; the demand for the Company's products and fluctuations in future revenues; the availability of future business ventures, commercial arrangements and acquisition targets or opportunities and the Company's ability to consummate them and to effectively integrate future acquisition targets into its platform; the Company's ability to grow its customer base; the effects of competition in the industry; the requirement for increasingly innovative product solutions and service offerings; trends in customer growth; the stability of general economic and market conditions; currency exchange rates and interest rates; the Company's ability to comply with applicable laws and regulations; the Company's continued compliance with third party intellectual property rights; and that the risk factors noted below, collectively, do not have a material impact on the Company's business, operations, revenues and/or results. By their nature, forward-looking statements are subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct, and that objectives, strategic goals and priorities will not be achieved.

Readers are encouraged to review the “Liquidity and Capital Resources” section of the Company’s MD&A, together with Note 3(c) of the Company’s annual financial statements, for the period ended December 31, 2023, which indicate the existence of material uncertainties that cast significant doubt on the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern was, as at December 31, 2023, dependent on, among other things, its ability to meet its financing requirements on a continuing basis, to continue to have access to financing, and to generate positive operating results. The Company’s ability to satisfy its financing requirements and ultimately achieve necessary levels of profitability and positive cash flows from operations, to raise additional funds, and to improve operating results were and are dependent on a number of factors outside the Company’s control, and while the Company has raised significant financing during the year ended December 31, 2023, there can be no assurance that the Company will continue to be successful in these endeavors in the future.
Known and unknown risk factors, many of which are beyond the control of the Company, could cause the actual results of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements. Such risk factors include but are not limited to those factors which are discussed under the section entitled “Risk Factors” in the Company’s annual information form dated March 31, 2023, which is available under the Company's SEDAR+ profile at www.sedarplus.com. The risk factors are not intended to represent a complete list of the factors that could affect the Company and the reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law. All of the forward-looking statements contained in this press release are qualified by these cautionary statements.

For more information:

Pardeep S. Sangha
Investor Relations, HEALWELL AI Inc.
Phone: 604-572-6392
This email address is being protected from spambots. You need JavaScript enabled to view it.