DocGo Announces Strong Second Quarter 2022 Results

DocGo Inc. (Nasdaq: DCGO), a leading provider of last-mile mobile health services, today announced financial and operating results for the second quarter ending June 30, 2022.

Second Quarter Financial Highlights

  • Total revenue increased to $109.5 million compared to $62.2 million in Q2 2021, an increase of 76%.
  • Gross margin improved to 35.9% compared to 34.0% in Q2 2021.
  • Net income increased to $11.8 million, compared to $0.1 million in Q2 2021.
  • Adjusted EBITDA1, a non-GAAP measure, increased to $12.3 million compared to $3.4 million in Q2 2021.
  • Mobile Health revenue was $87.3 million compared to $33.2 million in Q2 2021, an increase of 163% year over year.
  • Recurring Transportation Services revenue increased to $20.2 million compared to $18.7 million in Q2 2021, an increase of 8%. Total Transportation Services revenue, which include project-based, emergency deployment revenues, was $22.2 million in Q2 2022 compared to $28.9 million in Q2 2021.
  • Mass Covid testing-related revenues during the period is estimated to be approximately $28 million.
  • Six-month revenues through June 30, 2022 increased to $227.4 million, compared to $111.6 million in the same period in 2021, an increase of 104%.
  • Six-month net income through June 30, 2022 amounted to $21.1 million, compared to a net loss of $1.9 million in the six months ended June 30, 2022.
  • Six-month Adjusted EBITDA1 through June 30, 2022 increased to $25.9 million, compared to $3.8 million in the same period in 2021, an increase of 582%.
  • Total cash and cash equivalents at the end of the period were $208.4 million, an increase from $198.7 million at the end of Q1 and an increase from $179.1 million at 2021 year end.

Guidance Update for Fiscal 2022

  • Revenue guidance is increased to $425-$435 million, up from a previous range of $400-$420 million.
  • Adjusted EBITDA2 guidance is increased to $40-$45 million, up from a previous range of $35-$41 million.
  • Guidance increase is based on both continued organic growth and incremental M&A activities which occurred subsequent to quarter end.

Select Corporate Highlights

  • Selected for inclusion in the Russell 2000®Index.
  • Approved a $40 million share repurchase program.
  • Expanded mobile health services with Carnival Corporation to offer on-ship care at eight new ports in the U.S., Canada, England and Australia.
  • Executed a contract with L.A. Care Health Plan to facilitate mobile health services to Medicare and Medicaid populations in Los Angeles. Slated to launch in August, this relationship enables DocGo to reach eligible L.A. Care members with its range of mobile health services, including preventive, episodic and chronic care services, along with the ability to close gaps in care, among others.
  • Executed a multi-year contract to provide mobile health services to Empire BlueCross BlueShield members, covering commercial, Medicare and Medicaid populations in New York and the Medicaid population in New Jersey.
  • Major hospital system in southern California contracted with DocGo to provide at-home patient visits, resulting in a 35% reduction in unnecessary emergency room visits and a bonus payment to DocGo for facilitating such reduction.
  • DocGo continues to aggressively expand its workforce to support future growth and is expected to add 600+ full time clinical and operational positions in the second half of the year.

Stan Vashovsky, CEO of DocGo, commented, “our customers are consistently returning to DocGo for assistance with their healthcare needs and our unique, tech-enabled approach to delivering cost-effective healthcare outside of traditional brick and mortar facilities is unparalleled.” Vashovsky continued, “our quarter came in ahead of internal expectations and we anticipate contributions from new business wins across the spectrum, including three new national payer contracts and six new hospital contracts, will more than offset the wind down of mass Covid testing revenue going forward. In addition, DocGo won three large municipal RFPs, added one new international cruise line customer and expanded into two new states. Given the strength of our balance sheet, with over $200 million in total cash, we expect to remain active in pursuing synergistic M&A opportunities while also funding organic growth and other capital deployment activities, including our share repurchase program.”

_______________________________________________________________
1
Adjusted EBITDA is a non-GAAP financial measure. See “Non-GAAP Financial Measures” below for additional information on this non-GAAP financial measure and a reconciliation to the most comparable GAAP measure.
2 Adjusted EBITDA is a non-GAAP financial measure. We have not reconciled Adjusted EBITDA outlook to the most comparable GAAP outlook because it is not possible to do so without unreasonable efforts due to the uncertainty and potential variability of reconciling items, which are dependent on future events and often outside of management’s control and which could be significant. Because such items cannot be reasonably predicted with the level of precision required, we are unable to provide outlook for the comparable GAAP measure (net income). Forward- looking estimates of Adjusted EBITDA are made in a manner consistent with the relevant definitions and assumptions noted herein.

Conference call and webcast

DocGo management will host a conference call and webcast to discuss the second quarter results tomorrow, August 9th at 8:30 am ET. To access the conference call, please dial 1-877-407-0784 (U.S.) or 1-201-689-8560 (international). Reference conference ID 13730613.

The webcast can be accessed using the following link:
https://viavid.webcasts.com/starthere.jsp?ei=1554870&tp_key=f93a5a0c42 or under “Events” on the “Investors” section of the Company’s website, https://ir.docgo.com/. A replay of the webcast will be archived on the Company’s investor relations page through August 23, 2022 at approximately 5:00 pm ET.

About DocGo

DocGo is a leading provider of last-mile mobile health services. DocGo is disrupting the traditional four-wall healthcare system by providing care to patients where and when they need it. DocGo's innovative technology and dedicated field staff of certified health professionals elevate the quality of patient care and drive business efficiencies for facilities, hospital networks, and health insurance providers. With Mobile Health, DocGo empowers the full promise and potential of telehealth by facilitating healthcare treatment in the comfort of a patient's home or workplace. Together with DocGo's integrated Ambulnz medical transport services, DocGo is bridging the gap between physical and virtual care. For more information, please visit www.docgo.com.

Forward-Looking Statements

This announcement contains forward-looking statements (including within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and Section 27A of the U.S. Securities Act of 1933, as amended) concerning DocGo. These statements include, but are not limited to, statements that address our expected future business and financial performance and statements about (i) our plans, objectives and intentions with respect to future operations, services and products, including our transition to non-COVID related services, geographic expansion, new and existing contracts, M&A activity, workforce growth and share repurchase program, (ii) our competitive position and opportunities, including our ability to realize the benefits from our operating model, and (iii) other statements identified by words such as "may", "will", "expect", "intend", "plan", "potential", "believe", "seek", "could", "estimate", "judgment", "targeting", "should", "anticipate", "predict" "project", "aim", "goal", "outlook", "guidance", and similar words, phrases or expressions. These forward-looking statements are based on management's current expectations and beliefs, as well as assumptions made by, and information currently available to, management, and current market trends and conditions. Forward-looking statements inherently involve risks and uncertainties, many of which are beyond our control, and which may cause actual results to differ materially from those contained in our forward-looking statements. Accordingly, you should not place undue reliance on such statements. Particular uncertainties that could materially affect current or future results include possible accounting adjustments made in the process of finalizing reported financial results; any risks associated with global economic conditions and concerns; the effects of global outbreaks of pandemics or contagious diseases or fear of such outbreaks, such as the COVID-19 coronavirus pandemic; competitive pressures; pricing declines; rates of growth in our target markets; our ability to improve gross margins; cost-containment measures; legislative and regulatory actions; the impact of legal proceedings and compliance risks; the impact on our business and reputation in the event of information technology system failures, network disruptions, cyber-attacks, or losses or unauthorized access to, or release of, confidential information; and the ability of the company to comply with laws and regulations regarding data privacy and protection. We undertake no intent or obligation to publicly update or revise any of these forward-looking statements, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

The following information provides definition and reconciliation of the non-GAAP financial measure presented in this earnings release to the most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles (GAAP). The company has provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measure should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The non-GAAP financial measure in this earnings release may differ from similarly titled measures used by other companies.

Adjusted EBITDA

Adjusted EBITDA is considered a non-GAAP financial measure under the Securities and Exchange Commission’s (“SEC”) rules because it excludes certain amounts included in net income (loss) calculated in accordance with GAAP. Management believes that Adjusted EBITDA is a meaningful measure to share with investors because it facilitates comparison of the current period performance with that of the comparable prior period. In addition, Adjusted EBITDA affords investors a view of what management considers to be the Company’s core operating performance as well as the ability to make a more informed assessment of such operating performance as compared with that of the prior period.

The table below reflects the reconciliation of Net Income (Loss) to Adjusted EBITDA for the three and six months ended June 30, 2022 compared to the same periods in 2021 (in millions):

Q2 YTD

 

2021

2022

2021

2022

Net Income/(loss) (GAAP)

$0.1

$11.8

($1.9)

$21.1

(+) Net Interest expense/ (income)

$0.2

($0.1)

$0.2

$0.0

(+) Income Tax

$0.0

$0.3

$0.0

$0.8

(+) Depreciation & amortization

$1.9

$2.0

$3.5

$4.2

(-) Other income/gain

$0.0

($4.5)

$0.0

($4.4)

EBITDA

$2.2

$9.5

$1.8

$21.7

 

 

 

 

(+) Non-cash stock compensation

$0.4

$2.0

$0.8

$3.4

(+) Non-recurring expense

$0.8

$0.8

$1.2

$0.8

 

 

 

 

Adjusted EBITDA

$3.4

$12.3

$3.8

$25.9

DocGo Inc. and Subsidiaries
 
CONDENSED CONSOLIDATED BALANCE SHEETS
 
 

June 30,

December 31,

2022

2021

Unaudited

Audited

ASSETS
 
Current assets:
Cash and cash equivalents $

198,138,395

 

$

175,537,221

Accounts receivable, net of allowance of $7,047,958 and $7,377,389 as of June 30, 2022 and December 31, 2021, respectively

72,253,831

 

78,383,614

Prepaid expenses and other current assets

5,285,303

 

2,111,656

 
Total current assets

275,677,529

 

256,032,491

 
Property and equipment, net

12,229,997

 

12,733,889

Intangibles, net

10,415,401

 

10,678,049

Goodwill

8,686,966

 

8,686,966

Restricted cash

10,323,088

 

3,568,509

Operating lease right-of-use assets

3,812,085

 

4,195,682

Finance lease right-of-use assets

8,408,399

 

9,307,113

Equity method investment

619,348

 

589,058

Other assets

1,682,575

 

3,810,895

Total assets $

331,855,388

 

$

309,602,652

 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
Accounts payable $

12,915,952

 

$

15,833,970

Accrued liabilities

38,656,519

 

35,110,877

Line of credit

1,025,881

 

25,881

Notes payable, current

566,426

 

600,449

Due to seller

694,331

 

1,571,419

Operating lease liability, current

1,421,036

 

1,461,335

Finance lease liability, current

2,655,037

 

3,271,990

Total current liabilities

57,935,182

 

57,875,921

 
Notes payable, non-current

1,048,864

 

1,302,839

Operating lease liability, non-current

2,651,849

 

2,980,946

Finance lease liability, non-current

5,276,312

 

6,867,420

Warrant liabilities

10,549,485

 

13,518,502

Total liabilities

77,461,692

 

82,545,628

 
Commitments and Contingencies
 
STOCKHOLDERS’ EQUITY:
Common stock ($0.0001 par value; 500,000,000 shares authorized as of June 30, 2022 and December 31, 2021; 100,685,290 and 100,133,953 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively)

10,564

 

10,013

Additional paid-in-capital

287,301,467

 

283,161,216

Accumulated deficit

(40,191,367

)

(63,556,714

Accumulated other comprehensive loss

(27,930

)

(32,501

Total stockholders’ equity attributable to DocGo Inc. and Subsidiaries

247,092,734

 

219,582,014

Noncontrolling interests

7,300,962

 

7,475,010

Total stockholders’ equity

254,393,696

 

227,057,024

Total liabilities and stockholders’ equity $

331,855,388

 

$

309,602,652

 
DocGo Inc. and Subsidiaries
 
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)
 
Three Months Ended Six Months Ended
June 30, June 30,

2022

2021

2022

2021

 

Revenue, net $

109,519,304

$

62,185,997

$

227,410,856

$

111,555,391

Expenses:
Cost of revenues (exclusive of depreciation and amortization, which is shown separately below)

70,176,462

41,023,082

148,164,035

76,883,824

Operating expenses:
General and administrative

24,637,618

15,976,151

48,498,234

27,797,606

Depreciation and amortization

2,037,771

1,897,051

4,238,792

3,494,727

Legal and regulatory

3,061,276

1,176,711

4,409,259

1,833,369

Technology and development

1,148,320

664,882

2,290,153

1,126,282

Sales, advertising and marketing

1,000,100

1,189,361

2,258,061

2,034,781

Total expenses

102,061,547

61,927,238

209,858,534

113,170,589

Income (loss) from operations

7,457,757

258,759

17,552,322

(1,615,198

)

 
Other income (expenses):
Interest income (expense), net

98,276

(130,129

)

(37,330

)

(245,138

)

Gain on remeasurement of warrant liabilities

3,027,766

-

2,969,017

-

Gain on initial equity method investments

89,810

-

6,469

-

Gain on remeasurement of finance leases

1,388,273

-

1,388,273

-

Loss on disposal of fixed assets

-

(27,730

)

-

(27,730

)

Other income

15,640

-

11,387

-

Total other income (expense)

4,619,765

(157,859

)

4,337,816

(272,868

)

 
Net income (loss) before income tax benefit (expense)

12,077,522

100,900

21,890,138

(1,888,066

)

Income tax benefit (expense)

(321,660

)

1,107

(761,839

)

(8,923

)

Net income (loss)

11,755,862

102,007

21,128,299

(1,896,989

)

Net income (loss) attributable to noncontrolling interests

(979,791

)

1,748,223

(2,237,048

)

1,427,591

Net income (loss) attributable to stockholders of DocGo Inc. and Subsidiaries

12,735,653

(1,646,216

)

23,365,347

(3,324,580

)

Other comprehensive income (loss)
Foreign currency translation adjustment

10,434

94,655

4,571

102,653

Total comprehensive gain (loss) $

12,746,087

$

(1,551,561

)

$

23,369,918

$

(3,221,927

)

 
Net income (loss) per share attributable to DocGo Inc. and Subsidiaries - Basic

0.13

$

(18.19

)

$

0.23

$

(36.73

)

Weighted-average shares outstanding - Basic

99,303,948

90,505

100,372,146

90,505

 
Net income (loss) per share attributable to DocGo Inc. and Subsidiaries - Diluted $

0.11

$

(18.19

)

$

0.2

$

(36.73

)

Weighted-average shares outstanding - Diluted

115,279,676

90,505

116,347,874

90,505

 
DocGo Inc. and Subsidiaries
 
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 

Six Months Ended

June 30,

2022

2021

 

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $

21,128,299

$

(1,896,989

)

Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment

1,441,438

1,099,192

 

Amortization of intangible assets

1,279,078

879,984

 

Amortization of finance lease right-of-use assets

1,518,276

1,515,552

 

Loss on disposal of assets

-

27,730

 

Gain from equity method investment

(30,290

)

-

 

Bad debt expense

1,818,792

1,235,442

 

Stock based compensation

3,504,861

761,534

 

Gain on remeasurement of finance leases

(1,388,273

)

-

 

Gain on remeasurement of warrant liabilities

(2,969,017

)

-

 

Changes in operating assets and liabilities:
Accounts receivable

4,310,990

(17,442,642

)

Prepaid expenses and other current assets

(3,173,647

)

(2,353,394

)

Other assets

2,128,320

(90,647

)

Accounts payable

(2,927,492

)

2,791,050

 

Accrued liabilities

3,545,642

12,327,795

 

Net cash provided by (used in) operating activities

30,186,977

(1,145,393

)

 
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment

(941,655

)

(2,581,691

)

Acquisition of intangibles

(1,016,430

)

(1,023,643

)

Proceeds from disposal of property and equipment

-

6,000

 

Net cash used in investing activities

(1,958,085

)

(3,599,334

)

 
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit line

1,000,000

8,000,000

 

Repayments of notes payable

(287,998

)

(258,863

)

Due to seller

(877,088

)

-

 

Noncontrolling interest contributions

2,063,000

333,025

 

Proceeds from exercise of stock options

1,153,410

-

 

Common stock repurchased

(497,899

)

-

 

Equity costs

(19,570

)

-

 

Payments on obligations under finance lease

(1,411,565

)

(968,933

)

Acquisition of businesses

-

(56,496

)

Net cash provided by financing activities

1,122,290

7,048,733

 

 
 
Effect of exchange rate changes on cash and cash equivalents

4,571

102,653

 

 
Net increase in cash and restricted cash

29,355,753

2,406,659

 

Cash and restricted cash at beginning of period

179,105,730

34,457,273

 

Cash and restricted cash at end of period $

208,461,483

$

36,863,932

 

 
 
DocGo Inc. and Subsidiaries
 
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)

Six Months Ended

June 30,

2022

2021

Supplemental disclosure of cash and non-cash transactions:
Cash paid for interest $

129,363

$

28,816

 

 
Cash paid for interest on finance lease liabilities $

222,649

$

245,339

 

 
Cash paid for income taxes $

761,839

$

8,923

 

 
Right-of-use assets obtained in exchange for lease liabilities $

2,192,946

$

2,111,516

 

 
Fixed assets acquired in exchange for notes payable $

-

$

256,237

 

 
Reconciliation of cash and restricted cash
Cash $

198,138,395

$

33,146,205

 

 
Restricted Cash

10,323,088

3,717,727

 

 
Total cash and restricted cash shown in statement of cash flows $

208,461,483

$

36,863,932

 

 
DocGo Inc. and Subsidiaries
 
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

June 30,

2022

2021

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $

11,838,167

 

$

102,007

 

Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment

729,560

 

570,352

 

Amortization of intangible assets

645,715

 

457,960

 

Amortization of finance lease right-of-use assets

662,495

 

868,740

 

Loss on disposal of assets

-

 

27,730

 

Gain from equity method investment

(99,285

)

-

 

Bad debt expense

664,557

 

556,602

 

Stock based compensation

1,999,619

 

370,000

 

Gain on remeasurement of finance leases

(1,388,273

)

-

 

Gain on remeasurement of warrant liabilities

(2,910,268

)

-

 

Changes in operating assets and liabilities:
Accounts receivable

3,249,281

 

(10,303,967

)

Prepaid expenses and other current assets

(1,636,097

)

(231,851

)

Other assets

(59,922

)

22,737

 

Accounts payable

(2,255,748

)

3,374,413

 

Accrued liabilities

482,494

 

4,424,059

 

Net cash provided by (used in) operating activities

11,922,295

 

238,782

 

 
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment

(339,239

)

(1,821,642

)

Acquisition of intangibles

(481,806

)

(508,397

)

Proceeds from disposal of property and equipment

-

 

6,759

 

Net cash used in investing activities

(821,045

)

(2,323,280

)

 
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit line

-

 

8,000,000

 

Repayments of notes payable

(149,847

)

23,252

 

Due to seller

(716,838

)

-

 

Noncontrolling interest contributions

-

 

-

 

Proceeds from exercise of stock options

779,066

 

-

 

Common stock repurchased

(497,899

)

-

 

Equity costs

-

 

-

 

Payments on obligations under finance lease

(788,990

)

(367,432

)

Acquisition of businesses

-

 

(56,496

)

Net cash provided by financing activities

(1,374,508

)

7,599,324

 

 
 
Effect of exchange rate changes on cash and cash equivalents

10,434

 

94,655

 

 
Net increase in cash and restricted cash

9,737,176

 

5,609,481

 

Cash and restricted cash at beginning of period

198,724,307

 

31,254,451

 

Cash and restricted cash at end of period $

208,461,483

 

$

36,863,932

 

Three Months Ended Six Months Ended
June 30, June 30,

2022

2021

2022

2021

Primary Geographical Markets
U.S. $

106,314,813

$

59,946,797

$

221,368,244

$

107,308,709

U.K.

3,204,491

2,239,200

6,042,612

4,246,682

Total revenue $

109,519,304

$

62,185,997

$

227,410,856

$

111,555,391

 
Major Segments/Service Lines
Transportation Services $

22,175,233

$

28,936,421

$

49,987,743

$

47,740,979

Mobile Health

87,344,071

33,249,576

177,423,113

63,814,412

Total revenue $

109,519,304

$

62,185,997

$

227,410,856

$

111,555,391