LifeMD Reports Second Quarter 2023 Results; Achieves Positive Free Cash Flow and Raises 2023 Revenue Guidance

• Revenue grew 18% year-over-year to a record $35.9 million; telehealth net revenues increased 11% versus the first quarter of 2023.
• Achieved positive free cash flow, ahead of guidance.
• Adjusted EBITDA increased to $1.7 million in the second quarter 2023 from an adjusted EBITDA loss of $6.9 million in the year-ago period.
• Launched a comprehensive Weight Management program offering and onboarded over 5,000 new patient subscribers to date; the Weight Management program is expected to be substantially accretive beginning in 2024.
• Raised 2023 revenue guidance to $146 million to $152 million, reflecting early success with the Weight Management program.
  

Conference call begins at 4:30 p.m. Eastern time today

NEW YORK, Aug. 09, 2023 (GLOBE NEWSWIRE) -- LifeMD, Inc. ( LFMD), a leading provider of virtual primary care services, today reported financial results for the three and six months ended June 30, 2023.

Management Commentary

“The second quarter of 2023 was a breakout quarter for LifeMD. Record quarterly revenue was driven by increasing demand for our telehealth offering and we achieved positive free cash flow for the first time in our company’s history and ahead of guidance,” said Justin Schreiber, Chairman and Chief Executive Officer of LifeMD. “In addition, we launched our Weight Management telehealth service program, which is off to a tremendous start. We believe this comprehensive approach to weight management, including GLP-1 medications for medically qualified individuals, could be a catalyst for significant growth and enhanced profitability. It also is the primary reason for raising 2023 revenue guidance. In addition, I am extremely proud of the performance of our Lifestyle telehealth businesses anchored by our men’s health brand, RexMD. These businesses continued to exceed our expectations with a 16% increase in average daily new patient sign-ups in the quarter.”

“Our strong second quarter financial performance coupled with tremendous momentum in our telehealth businesses position LifeMD to gain share within these large markets. As such, we are raising our 2023 revenue guidance and slightly lowering adjusted EBITDA guidance given the near-term investment necessary to accelerate our growth in the Weight Management business, which we believe will be materially accretive beginning in 2024,” commented Marc Benathen, Chief Financial Officer of LifeMD. “WorkSimpli continues to perform well with active subscribers growing 35% over the prior-year period, and remains on track to generate over $15 million of cash flow this year that we are reinvesting in our core telehealth offerings.”

Second Quarter Financial Highlights

• Revenue increased 18% year-over-year to $35.9 million.
• Telehealth revenue increased 11% versus the first quarter of 2023.
• Telehealth active subscribers increased 15% over the year-ago period to approximately 193,000.
• Virtual Primary Care revenue increased 122% versus the first quarter of 2023.
• WorkSimpli active subscribers increased 35% over the year-ago period to approximately 171,000.
• Gross margin was 87%, up from 85% in the prior-year period.
• GAAP net loss was $7.5 million or $0.23 per share, compared with a GAAP net loss of $13.8 million or $0.45 per share in the prior-year period.
• Adjusted EBITDA was $1.7 million compared with an adjusted EBITDA loss of $6.9 million in the year-ago period (see definition below of this non-GAAP financial measure and reconciliation to GAAP).
• Adjusted diluted EPS was $0.05, up 123% versus the same period a year ago (see definition below of this non-GAAP financial measure and reconciliation to GAAP).
• Free cash flow, defined as operating cash flow less cash flow from investing activities, was $2.3 million, reaching the milestone of positive free cash flow ahead of guidance. Net cash flow including debt service was also positive.

Second Quarter Key Performance Metrics

Financial Guidance

For the third quarter of 2023, the Company expects:

• Revenue to be between $37.5 million and $38.5 million.
• Adjusted EBITDA to be between $2.5 million and $3.5 million.

For the full year 2023, the Company expects:

• Revenue to be between $146 million and $152 million.
• Adjusted EBITDA to be between $10 and $13 million.

Excluding the launch of the Weight Management program, revenue and adjusted EBITDA guidance for 2023 would be within the previously stated guidance ranges of $140 million to $150 million for revenue and $12 million to $18 million for adjusted EBITDA. The company’s preliminary estimates suggest its new Weight Management business could be substantially accretive to 2024 and beyond results.

Conference Call

LifeMD’s management will host a conference call today at 4:30 p.m. Eastern time to discuss the Company’s financial results and outlook, and answer questions. Details for the call are as follows:

A replay of the webcast will be available in the Investors section of the Company’s website at ir.lifemd.com.

About LifeMD

LifeMD is a direct-to-patient telehealth company with a portfolio of brands that offer virtual primary care, diagnostics and specialized treatment for men’s and women’s health, allergy & asthma and dermatologic conditions. By leveraging its proprietary technology platform, 50-state affiliated medical group and nationwide mail-order pharmacy network, LifeMD is making top-notch healthcare available and affordable to anyone. To learn more, go to LifeMD.com.

Cautionary Note Regarding Forward Looking Statements

This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended; Section 21E of the Securities Exchange Act of 1934, as amended; and the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this news release may be identified by the use of words such as: “believe,” “expect,” “anticipate,” “project,” “should,” “plan,” “will,” “may,” “intend,” “estimate,” predict,” “continue,” and “potential,” or, in each case, their negative or other variations or comparable terminology referencing future periods. Examples of forward-looking statements include, but are not limited to, statements regarding our financial outlook and guidance, short and long-term business performance and operations, future revenues and earnings, regulatory developments, legal events or outcomes, ability to comply with complex and evolving regulations, market conditions and trends, new or expanded products and offerings, growth strategies, underlying assumptions, and the effects of any of the foregoing on our future results of operations or financial condition.

Forward-looking statements are not historical facts and are not assurances of future performance. Rather, these statements are based on our current expectations, beliefs, and assumptions regarding future plans and strategies, projections, anticipated and unanticipated events and trends, the economy, and other future conditions, including the impact of any of the aforementioned on our future business. As forward-looking statements relate to the future, they are subject to inherent risk, uncertainties, and changes in circumstances and assumptions that are difficult to predict, including some of which are out of our control. Consequently, our actual results, performance, and financial condition may differ materially from those indicated in the forward-looking statements. These risks and uncertainties include, but are not limited to, “Risk Factors” identified in our filings with the Securities and Exchange Commission, including, but not limited to, our most recently filed Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and any amendments thereto. Even if our actual results, performance, or financial condition are consistent with forward-looking statements contained in such filings, they may not be indicative of our actual results, performance, or financial condition in subsequent periods.

Any forward-looking statement made in the news release is based on information currently available to us as of the date on which this release is made. We undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required under applicable law or regulation.

Company Contact:
LifeMD, Inc.
Marc Benathen, CFO
[email protected]