Exhibit 99.1

 

 

MARPAI reports Second QUARTER 2024 financial results

 

Company continues to drive towards profitability

 

Tampa, August 7, 2024, Marpai, Inc. (“Marpai” or the “Company”) (Nasdaq: MRAI), a technology platform company, which operates as a national Third-Party Administrator (TPA) through its subsidiaries and is transforming the $22 billion TPA market by offering affordable, intelligent, healthcare solutions to self-funded employer health plans, announced financial results for the second quarter of 2024. The Company expects to hold a webcast to discuss the results on August 8, 2024.

 

Q2 2024 Financial Highlights:

 

Net revenues were approximately $7.2 million for the three months ended June 30, 2024, down $2.9 million, or 28% lower year over year, compared to the three months ended June 30, 2023.

 

Operating expenses were $14.3 million for the three months ended June 30, 2024 (including a charge for the impairment of goodwill and intangibles of $7.6 million), higher by $3.4 million, or 32% higher year over year compared to the three months ended June 30, 2023.

 

Operating loss was $12.3 million for the three months ended June 30, 2024, higher by $5.0 million, or 69% higher year over year compared to the three months ended June 30, 2023.

 

Net loss was $13.0 million for the three months ended June 30, 2024, higher by $5.5 million, or 72% higher year over year compared to the three months ended June 30, 2023.

 

Basic and diluted earnings per share were ($1.23) for the three months ended June 30, 2024, down ($0.13) per share year over year compared to the three months ended June 30, 2023.

 

“The Company continues to show progress towards our goal of profitability,” said Damien Lamendola, Chief Executive Officer of Marpai. “Additionally, our new sales team has been hitting the pavement and have set up a strong sales pipeline for Q1 2025 which we expect we will highlight after the third quarter.”

 

John Powers, Marpai President commented, “The Marpai operations team has executed on our performance actions. Our customer service metrics and claim processing key process indicators (KPIs) have seen tremendous improvement year over year. Moreover, our clients and potential clients have recognized the impact of our Marpai Saves initiatives which drive down the overall cost of healthcare benefits.”

 

Webcast and Conference Call Information

 

Marpai expects to host a conference call and webcast on Thursday, August 8, 2024, at 8:30 a.m. ET to review the Company’s operational and financial highlights for its second quarter ended June 30, 2024.

 

Investors interested in listening to the conference call may do so by dialing (800)-836-8184 for domestic callers or +1-646-357-8785 for international callers, or via webcast: https://app.webinar.net/lrwPxYJnvpY

 

 

 

 

 

About Marpai, Inc.

 

Marpai, Inc. (OTCQX: MRAI) is a technology platform company which operates subsidiaries that provide TPA and value-oriented health plan services to employers that directly pay for employee health benefits. Primarily competing in the $22 billion TPA sector serving self-funded employer health plans representing over $1 trillion in annual claims. Through its Marpai Saves initiative, the Company works to deliver the healthiest member population for the health plan budget. Operating nationwide, Marpai offers access to leading provider networks including Aetna and Cigna and all TPA services. For more information, visit www.marpaihealth.com, the content of which is not incorporated by reference into this press release. Investors are invited to visit https://www.ir.marpaihealth.com. Investor Relations contact: Steve Johnson steve.johnson@marpaihealth.com

 

Forward-Looking Statement Disclaimer

 

This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties. Forward-looking statements can be identified through the use of words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “guidance,” “may,” “can,” “could”, “will”, “potential”, “should,” “goal” and variations of these words or similar expressions. For example, the Company is using forward looking statements when it discusses the Q1 2025 sales pipeline and the expected timing of its highlighting of its pipeline. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Marpai’s current expectations and speak only as of the date of this release. Actual results may differ materially from Marpai’s current expectations depending upon a number of factors. These factors include, among others, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business. Except as required by law, Marpai does not undertake any responsibility to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.

 

More detailed information about Marpai and the risk factors that may affect the realization of forward-looking statements is set forth in Marpai’s filings with the Securities and Exchange Commission. Investors and security holders are urged to read these documents free of charge on the SEC’s web site at http://www.sec.gov.

 

###

 

2

 

 

 

MARPAI, INC. AND SUBSIDIARES

CONDENSED CONSOLIDATED BALANCE SHEET

(in thousands, except share and per share data)

(Unaudited)

 

   June 30,
2024
   December 31,
2023
 
         
ASSETS:        
Current assets:        
Cash and cash equivalents  $1,293   $1,147 
Restricted cash   12,762    12,345 
Accounts receivable, net of allowance for credit losses of $0 and $25   805    1,124 
Unbilled receivable   568    768 
Due from buyer for sale of business unit   800    800 
Prepaid expenses and other current assets   967    901 
Total current assets   17,195    17,085 
Property and equipment, net   546    611 
Capitalized software, net   933    2,127 
Operating lease right-of-use assets   2,253    2,373 
Goodwill       3,018 
Intangible assets, net       5,177 
Security deposits   1,267    1,267 
Other long-term asset   22    22 
Total assets  $22,216   $31,680 
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY          
Current liabilities:          
Accounts payable  $3,172   $4,649 
Accrued expenses   2,643    2,816 
Accrued fiduciary obligations   9,948    11,573 
Deferred revenue   1,295    661 
Current portion of operating lease liabilities   541    512 
Current portion of convertible debenture, net   1,089     
Other short-term liabilities       632 
Total current liabilities   18,688    20,843 
Other long-term liabilities   20,144    19,401 
Convertible debenture, net of current portion   4,451     
Operating lease liabilities, net of current portion   3,405    3,684 
Deferred tax liabilities   1,190    1,190 
Total liabilities   47,878    45,118 
COMMITMENTS AND CONTINGENCIES          
STOCKHOLDERS’ (DEFICIT) EQUITY          
Common stock, $0.0001 par value, 227,791,050 shares authorized; 11,037,038 and 7,960,938 issued and outstanding at June 30, 2024 and  December 31, 2023, respectively (1)   1    1 
Additional paid-in capital   68,455    63,307 
Accumulated deficit   (94,118)   (76,746)
Total stockholders’ (deficit) equity   (25,662)   (13,438)
Total liabilities and stockholders’ (deficit) equity  $22,216   $31,680 

 

3

 

 

 

MARPAI, INC. AND SUBSIDIARES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

 

   Three Months Ended 
   June 30,
2024
   June 30,
2023
 
Revenue  $7,189   $10,047 
Costs and expenses          
Cost of revenue (exclusive of depreciation and amortization shown separately below)   5,174    6,430 
General and administrative   3,721    5,725 
Sales and marketing   436    1,473 
Information technology   1,210    1,319 
Research and development   8    523 
Depreciation and amortization   914    1,003 
Impairment of goodwill and intangible assets   7,588     
Loss on disposal of assets       344 
Facilities   411    500 
Total costs and expenses   19,462    17,317 
Operating loss   (12,273)   (7,270)
Other income (expenses)          
Other income   120    50 
Interest expense, net   (872)   (333)
Foreign exchange (loss) gain   (1)   (3)
Loss before provision for income taxes   (13,026)   (7,556)
Income tax expense        
Net loss  $(13,026)  $(7,556)
Net loss per share, basic & fully diluted  $(1.23)  $(1.10)
Weighted average common shares outstanding, basic and diluted   10,626,516    6,844,778 

 

4

 

 

 

MARPAI, INC. AND SUBSIDIARES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

 

   Six Months Ended 
   June 30,
2024
   June 30,
2023
 
Revenue  $14,574   $19,719 
Costs and expenses          
Cost of revenue (exclusive of depreciation and amortization shown separately below)   10,045    12,838 
General and administrative   7,142    10,951 
Sales and marketing   1,038    3,652 
Information technology   2,334    3,506 
Research and development   15    1,024 
Depreciation and amortization   1,865    2,047 
Impairment of goodwill and intangible assets   7,588     
Loss on disposal of assets       344 
Facilities   885    1,150 
Total costs and expenses   30,912    35,512 
Operating loss   (16,338)   (15,793)
Other income (expenses)          
Other income   240    101 
Interest expense, net   (1,270)   (718)
Foreign exchange (loss) gain   (4)   (19)
Loss before provision for income taxes   (17,372)   (16,429)
Income tax expense        
Net loss  $(17,372)  $(16,429)
Net loss per share, basic & fully diluted  $(1.73)  $(2.70)
Weighted average common shares outstanding, basic and diluted   10,016,146    6,080,200 

 

5

 

 

 

MARPAI, INC. AND SUBSIDIARES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, except share and per share data)

(Unaudited)

 

   Three Months Ended 
   June 30,
2024
   June 30,
2023
 
Cash flows from operating activities:        
Net loss  $(17,372)  $(16,429)
Adjustments to reconcile net loss to net cash used in operating activities:          
Depreciation and amortization   1,865    2,046 
Loss on disposal of assets       344 
Loss on sale of receivables   306     
Share-based compensation   2,421    990 
Shares issued to vendors in exchange for services       79 
Amortization of right-of-use asset   120    1,049 
Gain on termination of lease       33 
Impairment of goodwill and intangible assets   7,588     
Non-cash interest   646    776 
Amortization of debt discount   62     
Changes in operating assets and liabilities:          
Accounts receivable and unbilled receivable   519    74 
Prepaid expense and other assets   (66)   425 
Security deposit       (14)
Accounts payable   (1,477)   729 
Accrued expenses   (173)   (235)
Accrued fiduciary obligations   (1,625)   1,713 
Operating lease liabilities   (250)   (1,343)
Due To related party       (4)
Other liabilities   731    1,028 
Net cash used in operating activities   (6,705)   (8,739)
Cash flows from investing activities:          
Disposal of property and equipment       18 
Net cash provided by (used in) investing activities       18 
Cash flows from financing activities:          
Proceeds from issuance of common stock in a public offering, net       6,432 
Proceeds from stock options exercises   1,509     
Proceeds from issuance of convertible debentures   5,978     
Payments of convertible debenture issuance costs   (499)    
Payments to buyer of receivables   (1,816)    
Proceeds from issuance of common stock in a public offering, net   (631)    
Proceeds from issuance of common stock in a private offering, net   2,727     
Net cash provided by financing activities   7,268    6,432 
           
Net decrease in cash, cash equivalents and restricted cash   563    (2,289)
           
Cash, cash equivalents and restricted cash at beginning of period   13,492    23,117 
Cash, cash equivalents and restricted cash at end of period  $14,055   $20,828 
           
Reconciliation of cash, cash equivalents, and restricted cash reported in the condensed consolidated balance sheet          
Cash and cash equivalents  $1,293   $8,726 
Restricted cash   12,762    12,102 
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statement of cash flows  $14,055   $20,828 
Supplemental disclosure of cash flow information          
Cash paid for interest  $1,259   $ 
Supplemental disclosure of non-cash activity          
Measurement period adjustment to Goodwill  $   $198 

 

 

6