CareRx Corporation (TSX:CRRX) has reported a significant jump in its third-quarter revenue, which was driven by acquisitions and organic growth from new contracts.
For the three months ended September 30, 2022, the company reported revenue of $97.4 million, up 37% from the $71.3 million reported in the year-ago quarter.
CareRx said growth was driven primarily by the full quarter contribution of the Long-Term Care Pharmacy Business of Medical Pharmacies Group Limited (MPGL LTC Pharmacy Business), which was acquired in 3Q 2021; the contribution of the Long-Term Care Pharmacy Business of Hogan Pharmacy Partners Limited acquired on May 30, 2022; and organic growth from contract onboarded in the second half of 2021 and the first half of 2022.
READ: CareRx signs multi-year contract to provide pharmacy services to residents in seniors living facilities in Atlantic Canada
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) increased 12% to 7.7% million, up from $6.9 million in 3Q 2021.
CareRX noted that its adjusted EBITDA was impacted by the commencement of the onboarding of a large customer contract, reducing it by $0.5 million. It was also impacted by certain incremental costs associated with the higher-than-average number of open pharmacy staff positions as a result of the current labor market, including overtime, contract labor and recruitment costs, totalling $0.9 million.
Operational highlights included the signing of a multi-year contract to provide pharmacy services to residents in multiple senior living facilities in Atlantic Canada, initially serving up to 600 residents.
CareRX CEO David Murphy said the company’s 3Q results continued to reflect the execution of its organic and acquisition growth strategy.
“We continue to execute in areas that will support our growth in the near- and long-term and during the quarter we signed a new long-term agreement and contract extension with a large national customer which includes the onboarding of over 1,200 new beds,” he said.
“We also announced a significant step in our growth journey with our planned expansion into Atlantic Canada. New growth opportunities such as this, combined with our continued pursuit of acquisition opportunities in what remains a fragmented market, support our confidence in our growth potential in the near- and long-term."
CareRx narrowed its net loss for the period by 55% to $1.8 million, or $0.04 per share, compared to a net loss of $3.9 million, or $0.11 per share, in 3Q 2021.
The company said the decrease in net loss was driven primarily by the full quarter contribution of the MPGL LTC Pharmacy Business and decreases in transaction and restructuring costs and finance costs, partially offset by the commencement of the offboarding of a large customer contract, incremental costs incurred as a result of the current labour market and a lower positive impact from the change in the fair value of derivative financial instruments.
CareRx is Canada's leading provider of pharmacy services to senior living communities. The company serves over 95,000 residents in over 1,600 seniors and other congregate care communities, including long-term care homes, retirement homes, assisted living facilities, and group homes.
Contact the author at emily.jarvie@proactiveinvestors.com
Follow her on Twitter @emilyjjarvie