Kovo HealthTech Corporation (TSX-V:KOVO) saw a substantial increase in its 1Q revenue after two accretive acquisitions in 2021 complemented the strong organic growth of its core SaaS-style medical billing software.
The healthcare technology firm posted its highest quarterly revenue in company history at US$2.83 million, a 246% increase over the $820,000 it posted in the same year-ago quarter.
The quarter contributed to an annualized recurring revenue of approximately US$12 million, putting Kovo on-track to meet its previously disclosed 2022 initial guidance, the company said.
READ: Kovo HealthTech beats 2021 revenue guidance as two strategic acquisitions contribute to core Revenue Cycle Management business
Annual and quarterly revenue growth was generated by a combination of new sales and the acquisition of new clients via the M&A transactions, the company said.
Kovo posted year-over-year organic growth of 105%, excluding revenue growth attributed to its 2021 acquisitions. Organic growth for the quarter was driven primarily by two new client contracts signed during the quarter, CEO Greg Noble said, adding that the firm anticipates one of those contracts will continue to benefit the company's cash flow throughout 2022.
"At a time when the world economy is facing rising costs and uncertainty, Kovo continues to generate predictable and stable revenues," Noble told investors. "(The first quarter of) 2022 marks our 13th quarter of delivering consistent, revenue stability and that is setting the company up in a position of strength as we continue to explore future prospective 2022 acquisition targets.”
During the three-month period ended March 31, 2022, Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) was $46,000 compared to Adjusted EBITDA of $70,000 for the three months ended March 31, 2021.
"Kovo is consistently and reliably delivering positive cash flow from our RCM operations, and we continue to focus on improving our working capital month-over-month, while readying the company for our next roll-up, accretive acquisition," CFO Inder Saini added.
Saini told investors that the company is on track to meet the 30% organic growth target (exclusive of acquisitions) outlined in its initial 2022 guidance released earlier this year.
Vancouver-based Kovo HealthTech is a growing healthcare technology company that specializes in Billing-as-a-Service offering SaaS-style recurring revenue contracts and software for more than 1,700 US healthcare providers.
--Updated to reflect 1Q rather than 2Q results--
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