NextGen Healthcare Reports Fiscal 2022 Third Quarter Results

Raises Fiscal 2022 Financial Guidance

ATLANTA--(BUSINESS WIRE)--Jan. 25, 2022-- NextGen Healthcare, Inc.(Nasdaq: NXGN), a leading provider of ambulatory-focused technology solutions, today announced its operating results for the fiscal third quarter ended December 31, 2021.

Fiscal 2022 Third Quarter Highlights

• Total revenue for the fiscal 2022 third quarter was $149.7 millioncompared to $141.8 millionfor the same period a year ago, or 6 percent growth.
• Recurring revenue accounted for 90 percent of total revenue, or $134.5 million, growing 5 percent over the year ago period.
• Subscription services revenue in the fiscal third quarter generated $41.2 million, or 8 percent growth over the prior year period, driven by demand for NGE SaaS and Virtual Visit solutions.
• Fiscal 2022 third quarter bookings, which reflects annual contract value, was $37.7 million.
• Fully diluted net income per share in the fiscal 2022 third quarter was $0.08compared to net income of $0.01per share the same period a year ago.
• On a non-GAAP basis, fully diluted earnings per share for the fiscal 2022 third quarter was $0.24compared to $0.26for the same period a year ago.
• In October, the Board approved a $60 millionshare repurchase program.

“This is an exciting time at 188金宝搏手机app . Fiscal third quarter reflects more than record revenue driven by the strength and breadth of our tailored offering. NextGen has a refreshed board of directors with deep executive and diverse healthcare and technology experience. We have attracted top talent at key positions in the executive team to enhance an already strong group. And as a unit, we initiated actions to accelerate performance on our strategic growth objectives,” said David Sides, President and Chief Executive Officer of 188金宝搏手机app . “In my first four months on the job, I have prioritized listening to our clients and shareholders and have come away from these discussions, enthused about the overall independent ambulatory market and NextGen’s ability to lead its transformation. I look forward to leveraging our strong foundation to accelerate profitable growth and long-term shareholder value.”

188金宝搏手机app updates its fiscal year 2022 financial guidance as follows:

• Increase revenue to between $591and $595 million, from between $584and $590 millionprior
• Increase non-GAAP earnings per share range to between $0.96and $1.00from between $0.90and $0.96prior

Conference Call Information

188金宝搏手机app will host a conference call to discuss its fiscal year 2022 third quarter operating results today at 5:00 p.m. Eastern time. Shareholders and interested participants may listen to a live broadcast of the conference call by dialing 866-831-8713 or 203-518-9822 for international callers and referencing participant code NXGNQ322 approximately 15 minutes prior to the call. A recording of the live webcast will be available oninvestor.www.orderpulsa.comafter the call. It will be archived for 90 days.

SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS

This news release may contain forward-looking statements within the meaning of the federal securities laws, including but not limited to, statements regarding future events including but not limited to the COVID-19 pandemic, developments in the healthcare sector and regulatory framework, share repurchases, the Company's future performance, as well as management's expectations, beliefs, intentions, plans, estimates or projections relating to the future (including, without limitation, statements concerning revenue, net income, and earnings per share). Risks and uncertainties exist that may cause the results to differ materially from those set forth in these forward-looking statements. Factors that could cause the anticipated results to differ from those described in the forward-looking statements and additional risks and uncertainties are set forth in Part I, Item A of our most recent Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q, including but not limited to: volatility and uncertainty in the global economy, financial markets and on our customers in light of the continuing COVID-19 pandemic, including the potential (i) slowdown or shutdown of preventive and elective medical procedures, (ii) delay in the contracting for additional products and services by our customers and (iii) delay in the sales cycle for new customers; the volume and timing of systems sales and installations; length of sales cycles and the installation process; the possibility that products will not achieve or sustain market acceptance; seasonal patterns of sales and customer buying behavior; impact of incentive payments under The American Recovery and Reinvestment Act on sales and the ability of the Company to meet continued certification requirements; uncertainties related to the future impact of U.S.税制改革;政府和regulat的影响ory agency investigations; the development by competitors of new or superior technologies; the timing, cost and success or failure of new product and service introductions, development and product upgrade releases; undetected errors or bugs in software; product liability; changing economic, political or regulatory influences in the health-care industry; changes in product-pricing policies; availability of third-party products and components; competitive pressures including product offerings, pricing and promotional activities; the Company's ability or inability to attract and retain qualified personnel; possible regulation of the Company's software by the U.S. Food and Drug Administration; changes of accounting estimates and assumptions used to prepare the prior periods' financial statements; disruptions caused by acquisitions of companies, products, or technologies; the extent to which the COVID-19 pandemic and measures taken in response thereto could adversely affect our financial condition and results of operations; and general economic conditions. A significant portion of the Company's quarterly sales of software product licenses and computer hardware is concluded in the last month of a fiscal quarter, generally with a concentration of such revenues earned in the final ten business days of that month. Due to these and other factors, the Company's revenues and operating results are very difficult to forecast. A major portion of the Company's costs and expenses, such as personnel and facilities, are of a fixed nature and, accordingly, a shortfall or decline in quarterly and/or annual revenues typically results in lower profitability or losses. As a result, comparison of the Company's period-to-period financial performance is not necessarily meaningful and should not be relied upon as an indicator of future performance. These forward-looking statements speak only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

USE OF NON-GAAP FINANCIAL MEASURES

This news release contains certain non-GAAP (Generally Accepted Accounting Principles) financial measures, which are provided only as supplemental information. Investors should consider these non-GAAP financial measures only in conjunction with the comparable GAAP financial measures. These non-GAAP measures are not in accordance with or a substitute for U.S.GAAP. Pursuant to the requirements of Regulation G, the Company has provided a reconciliation of non-GAAP financial measures to the most directly comparable financial measure in the accompanying financial tables. Other companies may calculate non-GAAP measures differently than NextGen Healthcare, Inc., which limits comparability between companies. The Company believes that its presentation of non-GAAP diluted earnings per share provides useful supplemental information to investors and management regarding the Company's financial condition and results. The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. The Company calculates free cash flow by as total net cash provided by operating activities, net of cash used for the additions of capitalized software costs and equipment and improvements. The Company calculates net debt as line of credit less cash and cash equivalents. The Company calculates non-GAAP diluted earnings per share by excluding net acquisition costs, amortization of acquired intangible assets, amortization of deferred debt issuance costs, impairment of assets, restructuring costs, shareholder disputes and related costs, net of insurance, which include net securities litigation defense, proxy contest, and related costs, share-based compensation, and other non-run-rate expenses from GAAP income before provision for income taxes.

The Company utilizes a normalized non-GAAP tax rate to provide better consistency across the interim reporting periods within a given fiscal year by eliminating the effects of non-recurring and period-specific items, which can vary in size and frequency, and which are not necessarily reflective of the Company’s longer-term operations. The normalized non-GAAP tax rate expected to be applied to each quarter of fiscal year 2022 is 20.0%. The determination of this rate is based on the consideration of both historic and projected financial results. The Company may adjust its non-GAAP tax rate as additional information becomes available and in conjunction with any other significant events occur that may materially affect this rate, such as merger and acquisition activity, changes in business outlook, or other changes in expectations regarding tax regulations.

The Company’s future period guidance in this release includes adjustments for items not indicative of the Company’s core operations. Such adjustments are generally expected to be of a nature similar to those adjustments applied to the Company’s historic GAAP financial results in the determination of the Company’s non-GAAP diluted earnings per share. Such adjustments, however, may be affected by changes in ongoing assumptions and judgments as to the items that are excluded in the calculation of non-GAAP adjusted net income and adjusted diluted earnings per share, as described in this release. The exact amount and probable significance of these adjustments, including net acquisition costs, impairment of assets, restructuring costs, shareholder disputes and related costs, which include net securities litigation defense, proxy contest, and related costs, and other non-run-rate expenses, are not currently determinable without unreasonable efforts, but may be significant. These items cannot be reliably quantified or forecasted due to the combination of their historic and expected variability. It is therefore not practicable to reconcile this non-GAAP guidance to the most comparable GAAP measures.

About NextGen Healthcare, Inc.

NextGen Healthcare, Inc.(Nasdaq: NXGN) is a leading provider of ambulatory-focused technology solutions. We are empowering the transformation of ambulatory care—partnering with medical, behavioral and dental providers in their journey to value-based care to make healthcare better for everyone. We go beyond EHR and PM. Our integrated solutions help increase clinical productivity, enrich the patient experience, and ensure healthy financial outcomes. We believe in better. Learn more atwww.orderpulsa.com, and follow us onFacebook,Twitter,LinkedIn,YouTubeandInstagram.

NEXTGEN HEALTHCARE, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited)
	Three Months Ended December 31,								Nine Months Ended December 31,
	2021				2020				2021				2020
Revenues:
Recurring	$	134,496			$	128,243			$	402,486			$	373,456
Software, hardware, and other non-recurring		15,225				13,509				42,605				39,177
Total revenues		149,721				141,752				445,091				412633年
Cost of revenue:
Recurring		58,033				54,204				172,312				157,539
Software, hardware, and other non-recurring		7,978				6,800				23,085				18,924
Amortization of capitalized software costs and acquired intangible assets		8,193				9,320				24,246				29,180
Total cost of revenue		74,204				70,324				219,643				205,643
Gross profit		75,517				71,428				225,448				206,990
Operating expenses:
Selling, general and administrative		47,238				48,972				159,615				131,659
Research and development costs, net		19,390				18,197				57,229				54,111
Amortization of acquired intangible assets		881				1,112				2,643				3,336
Impairment of assets		—				2,215				1,577				2,215
Restructuring costs		—				—				539				2,562
Total operating expenses		67,509				70,496				221,603				193,883
Income from operations		8,008				932				3,845				13,107
Interest income		50				9				79				27
Interest expense		(321	)			(631	)			(958	)			(2,873	)
Other expense, net		(9	)			(15	)			(43	)			(17	)
Income before provision for (benefit of) income taxes		7,728				295				2,923				10,244
Provision for (benefit of) income taxes		2,535				(169	)			1,653				149
Net income:	$	5,193			$	464			$	1,270			$	10,095
Net income per share:
Basic	$	0.08			$	0.01			$	0.02			$	0.15
Diluted	$	0.08			$	0.01			$	0.02			$	0.15
Weighted-average shares outstanding:
Basic		67,958				66,943				67,514				66644年
Diluted		68,167				67,140				67,851				66649年

NEXTGEN HEALTHCARE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except per share data) (Unaudited)
		December 31, 2021				March 31, 2021
ASSETS
Current assets:
Cash and cash equivalents		$	49,429			$	73,295
Restricted cash and cash equivalents			4,921				5,280
Accounts receivable, net			70,080				77,541
Contract assets			24,246				19,481
Income taxes receivable			6,966				765
Prepaid expenses and other current assets			30,098				31,282
Total current assets			185,740				207,644
Equipment and improvements, net			10,818				14,539
Capitalized software costs, net			41,719				41,474
Operating lease assets			13,047				18,446
Deferred income taxes, net			19,439				19,474
Contract assets, net of current			1,997				1,976
Intangibles, net			27,402				36,700
Goodwill			267,212				267,212
Other assets			37,960				37021年
Total assets		$	605,334			$	644,486
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	15,232			$	11,378
Contract liabilities			54,879				52,863
Accrued compensation and related benefits			42,019				50,374
Income taxes payable			405				584
Operating lease liabilities			8,437				12,735
Other current liabilities			49,436				52,699
Total current liabilities			170,408				180,633
Deferred compensation			7,671				6,620
Operating lease liabilities, net of current			12,781				18,453
Other noncurrent liabilities			3,331				7,136
Total liabilities			194,191				212,842
Commitments and contingencies
Shareholders' equity:
Common stock, $0.01par value; authorized 100,000 shares; issued and outstanding 66,865 and 67,069 shares at December 31, 2021and March 31, 2021, respectively			690				671
Treasurystock, at cost, 2,170 shares at December 31, 2021			(35,874	)			—
Additional paid-in capital			318,356				304,263
积累其他综合损失			(1,933	)			(1,924	)
Retained earnings			129,904				128,634
Total shareholders' equity			411,143				431,644
Total liabilities and shareholders' equity		$	605,334			$	644,486

NEXTGEN HEALTHCARE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (千) (Unaudited)
	Three Months Ended December 31,								Nine Months Ended December 31,
	2021				2020				2021				2020
Cash flows from operating activities:
Net income	$	5,193			$	464			$	1,270			$	10,095
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of capitalized software costs		5,975				4,975				17,592				14,828
Amortization of debt issuance costs		127				177				381				532
Amortization of other intangibles		3,100				5,456				9,298				17,688
Change in fair value of contingent consideration		7				25				7				75
Deferred income taxes		6				(15	)			35				(42	)
Depreciation		1,625				2,151				5,406				6,088
Excess tax deficiency from share-based compensation		194				(71	)			834				870
Impairment of assets		—				2,215				1,577				2,215
Loss on disposal of equipment and improvements		—				27				77				27
Non-cash operating lease costs		1,368				1,732				4,455				5,153
Provision for bad debts		463				645				1,142				2,044
Share-based compensation		7,050				5,933				18,685				16,763
Changes in assets and liabilities:
Accounts receivable		1,445				(2,284	)			6,319				1,221
Contract assets		(3,731	)			(1,577	)			(4,786	)			(4058	)
Accounts payable		2,484				961				3,592				(2,795	)
Contract liabilities		1,373				213				2,016				(8,131	)
Accrued compensation and related benefits		7,966				7,862				(8,355	)			16,210
Income taxes		2,110				(1,411	)			(7,214	)			(3494	)
Deferred compensation		396				484				1,051				1,324
Operating lease liabilities		(4,702	)			(4,819	)			(10,062	)			(10,043	)
Other assets and liabilities		(16,292	)			4,803				(6,684	)			9,408
经营活动净现金		16,157				27,946				36,636				75,978
Cash flows from investing activities:
Additions to capitalized software costs		(6,124	)			(6,831	)			(17,837	)			(18,914	)
Additions to equipment and improvements		(352	)			(782	)			(2,037	)			(1,546	)
Acquisition related working capital adjustment payments		—				—				—				(206	)
Net cash used in investing activities		(6,476	)			(7,613	)			(19874	)			(20,666	)
Cash flows from financing activities:
Proceeds from line of credit		—				—				—				50,000
Repayments on line of credit		—				(35,000	)			—				(150,000	)
Payment of contingent consideration related to acquisitions		(540	)			—				(540	)			—
Proceeds from issuance of shares under employee plans		(232	)			1,199				877				1,997
Repurchase of common stock		(35,874	)			—				(35,874	)			—
Payments for taxes related to net share settlement of equity awards		(249	)			(1,646	)			(5,450	)			(3,897	)
Net cash used in financing activities		(36,895	)			(35,447	)			(40,987	)			(101,900	)
Net decrease in cash, cash equivalents, and restricted cash		(27,214	)			(15,114	)			(24,225	)			(46,588	)
Cash, cash equivalents, and restricted cash at beginning of period		81,564				108,845				78,575				140,319
Cash, cash equivalents, and restricted cash at end of period	$	54,350			$	93,731			$	54,350			$	93,731

NEXTGEN HEALTHCARE, INC. SUPPLEMENTAL FINANCIAL INFORMATION (千)
The following table presents our revenues disaggregated by our major revenue categories and by occurrence:
	Three Months Ended December 31,								Nine Months Ended December 31,
	2021				2020				2021				2020
Recurring revenues:
Subscription services	$	41,158			$	37,958			$	120,581			$	110,185
Support and maintenance		38,246				37,914				115,736				114,537
Managed services		28,861				27,395				87,798				76,106
Electronic data interchange and data services		26,231				24,976				78,371				72,628
Total recurring revenues		134,496				128,243				402,486				373,456
Software, hardware, and other non-recurring revenues:
Software license and hardware		8,920				7,908				24,202				20,662
Other non-recurring services		6,305				5,601				18,403				18,515
Total software, hardware and other non-recurring revenues		15,225				13,509				42,605				39,177
Total revenues	$	149,721			$	141,752			$	445,091			$	412633年
Recurring revenues as a percentage of total revenues		89.8	%			90.5	%			90.4	%			90.5	%

NEXTGEN HEALTHCARE, INC. NON-GAAP FINANCIAL MEASURES (In thousands, except per share data)
RECONCILIATION OF NON-GAAP DILUTED EARNINGS PER SHARE
	Three Months Ended December 31,								Nine Months Ended December 31,
	2021				2020				2021				2020
Income before provision for income taxes - GAAP	$	7,728			$	295			$	2,923			$	10,244
Non-GAAP adjustments:
Acquisition costs, net		—				118				—				380
Amortization of acquired intangible assets		3,099				5,456				9,298				17,688
Amortization of deferred debt issuance costs		127				177				381				532
Impairment of assets		—				2,215				1,577				2,215
Restructuring costs		—				—				539				2,562
Shareholder disputes and related costs, net of insurance		2,224				5,955				29,216				10,214
Share-based compensation		7,050				5,933				18,685				16,763
Other non-run-rate expenses*		351				1,669				4,379				4,134
Total adjustments to GAAP income before provision for income taxes:		12,851				21,523				64,075				54,488
Income before provision for income taxes - Non-GAAP		20,579				21,818				66,998				64,732
Provision for income taxes		4,116				4,363				13,400				12,946
Net income - Non-GAAP	$	16,463			$	17,455			$	53,598			$	51,786
Diluted net income per share - Non-GAAP	$	0.24			$	0.26			$	0.79			$	0.78
Weighted-average shares outstanding (diluted):		68,167				67,140				67,851				66649年
* Other non-run-rate expenses for the three months ended December 31, 2021consist primarily of $312excess lease-related expense for vacated facilities and other costs and $39of professional services costs not related to core operations. Other non-run-rate expenses for the three months ended December 31, 2020consist primarily of $1,204excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses and severance expense, related to the restructuring plan and $465of professional services costs not related to core operations. Other non-run-rate expenses for the nine months ended December 31, 2021consist primarily of $1,135excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses, related to the restructuring plan and $2,707of executive transition costs, including severance and other costs related to the departure of the CEO, $498of incremental costs and penalties primarily due to the cancellation of certain events directly associated with the COVID-19 pandemic, and $39of professional services costs not related to core operations. Other non-run-rate expenses for the nine months ended December 31, 2020consist primarily of $2,631excess lease-related expense for vacated facilities, lease termination costs, and other costs, including retention bonuses and severance expense, related to the restructuring plan, $1,404of professional services costs not related to core operations, and $99of incremental costs and penalties primarily due to the cancellation of certain events directly associated with the COVID-19 pandemic.

RECONCILIATION OF FREE CASH FLOW

	Three Months Ended December 31,								Nine Months Ended December 31,
	2021				2020				2021				2020
经营活动净现金	$	16,157			$	27,946			$	36,636			$	75,978
Additions to capitalized software costs		(6,124	)			(6,831	)			(17,837	)			(18,914	)
Additions to equipment and improvements		(352	)			(782	)			(2,037	)			(1,546	)
Free cash flow	$	9,681			$	20,333			$	16,762			$	55,518

View source version onbusinesswire.com:https://www.businesswire.com/news/home/20220125005807/en/

Media Relations Contact
Tami Stegmaier
(949) 237-6083
tstegmaier@www.orderpulsa.com

Investor Relations Contact
Matthew Scalo
(415) 370-9202
mscalo@www.orderpulsa.com

Source: NextGen Healthcare, Inc.