Forian Inc.
Q1 2021 Earnings Call Transcript

Published: 17 May 2021

[Operator:]

Greetings and welcome to Forian Inc’s First Quarter 2021 Financial Results Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder this conference is being recorded. On the line from Forian today we have Max Wygod, Executive Chairman, Co-Founder; Daniel Barton, Chief Executive Officer; Clifford Farren, Chief Financial Officer; Adam Dublin, Chief Strategy Officer and Co-Founder; Edward Spaniel, Executive Vice President and General Counsel. Before we begin I would like to remind you that management’s remarks on this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Our actual results may differ materially from those indicated by those forward-looking statements as a result of various supporting factors including those discussed in the risk factors section of our Form 10-K filed with the Securities and Exchange Commission. Any forward-looking statements made on this call represent our views only as of today and we undertake no obligation to update them. Words such as estimates, project, expect, anticipate, forecast, plans, intend, believes, seeks, may, will, should, future, propose and variations of those words or similar expressions or versions of such expressions are intended to identify forward-looking statements. These statements are included but are not limited to statements regarding future growth or prospects.

[Max Wygod:]

Thank you. Good morning everyone and welcome to Forian’s first earnings call as a NASDAQ publicly traded company. We would like to thank all of our shareholders for their support and express our appreciation for the voice that they have demonstrated in Forian’s mission and the business combination of Helix and MOR Analytics. The success of the transaction enables us to further execute on our vision to be the most trusted source of technology and mission critical analytics for the emerging cannabis market while building innovative solutions for customers across the healthcare market. Forian is now uniquely positioned to generate significant value for traditional healthcare and cannabis companies as well as those seeking to operate at the intersection of their healthcare and legal cannabis market. For traditional healthcare companies Forian delivers data driven commercial and clinical information solutions based on years of experience across the industry to improve business and clinical performance. In the legal cannabis market Forian is a trusted leader in point of sale, seed to sale, cultivation, and traceability technologies. As the use of alternative therapeutics and cleaning cannabinoid based therapies continues to grow and become more widely accepted, the understanding of how these alternative therapies impact clinical outcomes, standards of care, cost efficiency, and quality of life will be required to successfully integrate these new therapies into patient journey and achieve acceptance and adoption for patients, providers, and payers.

[Daniel Barton:]

Thanks Max. Before I start with my prepared remarks I would like to thank all of our tremendously talented employees who have quickly adapted to new working conditions in a very challenging environment due to the pandemic while simultaneously merging two businesses together. Our success is the result of their efforts and we look forward with confidence thanks in large part to our team. I'd like to cover a couple of topics today. First, I will provide a brief summary of our product portfolio and how we are positioned for growth. Second, I will outline our major priorities for the year. The foundation of our business is built upon our proprietary databases and technologies. Driven by data science we are developing intelligent technologies that deliver innovative and disruptive solutions. Our technologies are designed to service the needs of multiple market segments and our database delivers near real time information and industry leading scale. We have developed an integrated HIPPA compliant repository of longitudinal de-identified healthcare data, consumer demographic information, lifestyle and behavioral data representing the majority of U.S. healthcare patients, providers, and payers that is coupled with one of the largest cannabis transactional data bases in the U. S. covering over 10 million cannabis consumers. These integrated and interoperable data are used to power our product portfolios. Our products assist our customers in better understanding the value and efficacy of both healthcare and cannabis products while providing critical business insights into client’s products, services, customers, and the dynamics of a rapidly changing marketplace.

[Cliff Farren:]

Thanks, Dan. Today, I would like to provide an overview of our financial results and key business metrics for Forian’s first quarter ended March 31, 2021. As previously disclosed in our SEC filings, Forian completed the business combination of Helix and MOR Analytics on March 2, 2021. The press release just issued presents Forian’s first quarter 2021 financial results on a GAAP basis as well as a pro forma financial results for the quarter as if the results of Helix were included for the entire quarter in each period. We have also disclosed adjusted EBITDA which management uses as a measure to track the performance of the business. The press release includes a detailed reconciliation of these measures.

[Daniel Barton:]

Thanks, Cliff. In summary, first quarter results were in line with our expectations. We're excited by the growth opportunities in our addressable markets. By making strategic investments in our products, customer service, infrastructure, and most importantly in our employees, I am confident we will be able to accelerate innovation, drive rapid growth in our revenue and profitability, drive deeper customer penetration with disruptive new products and deliver exceptional value to our customers. At this point, I will turn the call over to the operator who will open the line for questions.

[Operator:]

Thank you. . While we are waiting for questions to come in the queue, I'll turn the call back to Dan Barton to take some questions that came through the email.

[Daniel Barton:]

Thank you. First we had a question that the company plans to file its 10-Q today and we do. Our filing is complete and we're waiting for our auditors to wrap up their confirmatory procedures. Assuming that process completes today and we do, we will be filing our 10-Q. The next question was how do we see COVID affecting Forian? As the impact of COVID-19 declines, we expect that sales and operations will revert back to pre-COVID trajectories. We saw on healthcare longer sales cycle with both large and small companies and this was due in large part to their focus on conservative cash management. The recent momentum in our pipeline indicates the return to more normal customer buying patterns in this segment. In the cannabis market we saw most customers classified as essential businesses and saw them continue to grow but we also saw dispensaries in locations dependent on tourism that struggle. Some of the lasting impacts of COVID are the advancement of non-personnel promotion services such as online ordering. And in addition, we think that across the board, the importance of customer retention is heightened and that the need for accurate analytics has begun top of mind as clients start spending more with ancillary products and a growing competitive space. Finally, what provides foreign competence and growing revenue opportunities? As mentioned in the prepared remarks, we shared that one of the reasons we believe that we are well poised for growth and revenue this year is our emerging pipeline. We have and are continuing to invest in our sales and marketing efforts. This investment to date has yielded a pipeline that is growing meaning meaningfully each month. Based on our pipeline coverage, we feel positive about revenue growth going forward. At this point, I will turn it back to the operator for any additional questions.

[Operator:]

Our first question comes from Gerard Heymann with RBC.

[Gerard Heymann:]

Hello gentlemen. Congratulations on your first -- on your merger and your first quarter earnings. Very exciting. Thank you. I have one quick question and it's with the implementation of the four points that you mentioned earlier in this call. How do you estimate your growth prospects for the next year and also into the future?

[Cliff Farren:]

Thank you for the question. As you rightly pointed out, we have a well-defined strategy and some of the execution points that I mentioned earlier, are key to our success both in the near and the long-term. But we're not providing forward-looking guidance at this time. We believe that we believe that the pipeline that I mentioned is growing, we're seeing larger contracts in the healthcare segment, and multi-year contracts. So we feel very good about our ability to grow the business in the short and long term.

[Gerard Heymann:]

Thank you very much.

[Operator:]

. And I'm not showing any further questions at this time. So this does conclude today's presentation. You may now disconnect and have a wonderful day.