• Q3 2021 is the first quarter that fully recognizes the financial results from all previously announced and closed acquisitions
  
• Record Q3 2021 revenue of $39.2 million; an increase of 150% compared to Q2 2021 and an increase of 1066% compared to Q3 2020
• First quarter with positive Adjusted EBITDA of $0.8 million compared to a loss of $0.7 million in Q2 2021 and a loss of $1.3 million in Q3 2020
• Increased annualized revenue run rate to over $185 million demonstrating strategic capital allocation and strong organic growth
• Increased engagement on the Comprehensive Integrated Health Platform; added an additional 300,000 employees and family members, resulting in a total of 560,000 individuals
• Positive client outcomes with Net Promoter Score of 80, 98% satisfaction rate and 164 new clients added in the quarter
• Program with Sun Life delivered proven data-driven individual health outcomes including:
  • 89% of those experiencing depression and 91% of those experiencing anxiety noticed 'major improvements'
  • 82% said they would recommend the service based on their own experience
  • 46% increase in plan members utilizing their mental health benefits for the first time

VANCOUVER, British Columbia, Nov. 29, 2021 (GLOBE NEWSWIRE) -- CloudMD Software & Services Inc. (TSXV: DOC, OTCQB: DOCRF, Frankfurt: 6PH) (the "Company" or "CloudMD"), a healthcare technology company revolutionizing the delivery of care, announced its financial results for the third quarter ended September 30, 2021. All financial information is presented in Canadian dollars unless otherwise indicated.

"This was a milestone quarter for CloudMD as it's the first quarter we recognized full revenue contributions from all the recently closed acquisitions and clearly demonstrated that our whole-person, patient-centric approach to healthcare is working. We've onboarded 560,000 individuals onto our Comprehensive Integrated Health Platform and are providing valuable data-driven outcomes, which is proven by our successful program with Sun Life where 89% of those experiencing depression and 91% of those experiencing anxiety noticed major improvements. We've also achieved positive client outcomes across engagement, attachment rate, and net promoter scores," said Dr. Essam Hamza, CEO of CloudMD. "I am extremely proud of the Company's progress and the team's ability to execute on our growth strategy across all divisions, which is evident by new clients wins, rapid growth and improved profitability. Our unique, proprietary healthcare offering is an industry first, and I'm confident that we will be able to continue our North American and global expansion."

Third Quarter 2021 Financial Highlights

• Q3 2021 revenue was $39.2 million, compared to $15.7 million in Q2 2021 and $3.4 million in Q3 2020. The increase is primarily attributable to acquisition growth with 4 acquisitions completed in the preceding quarter, and 14 acquisitions completed in the last 12 months.
  

• Q3 2021 gross margin¹ was 34.0%, compared to 35.5% in Q2 2021 and 37.5% in Q3 2020. The decrease is due to revenue mix where the Company's patient support programs and online eyewear platform, currently lower-margin businesses, represented 32% of revenues for the current quarter. The Company expects its gross margin to increase due to ongoing efforts to integrate its acquisitions and increase its operational efficiency.
  
• Net comprehensive loss attributable to equity holders of the Company in Q3 2021 was $4.2 million or $0.02 per share, compared to $6.2 million or $0.03 per share in Q2 2021 and $2.7 million or $0.02 per share in Q3 2020.
  
• Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA¹") was $0.8 million in Q3 2021, compared to a loss of $0.7 million in Q2 2021 and a loss of $1.3 million in Q3 2020.
  
• Cash and cash equivalents were $53.7 million as at September 30, 2021, compared to $60.9 million at June 30, 2021 and $59.7 million at December 31, 2020. The decrease for the period was primarily attributable to payments related to the acquisitions completed near the end of June 2021, which will not reoccur in the future.
  

Third Quarter & Subsequent Corporate Highlights

• On September 14, 2021, the Company announced a partnership with 19 new post-secondary institutions across Canada to provide its Aspiria Student Assistance Program and multi-layered mental health resources to over 167,000 additional students.
  
• On September 28, 2021, the Company announced the appointment of KPMG LLP as the Company's independent auditors to hold office until the end of the next annual general meeting of shareholders.
  
• On October 5, 2021, the Company announced the appointment of Angel Paravicini as Senior Vice President of Business Development and Customer Success to drive expansion in the United States and globally.
  
• On October 27, 2021, the Company announced that through one of its subsidiaries, it has received U.S. Patent Approval for its Real Time Intervention Platform ("RTIP") which is the technology backbone for CloudMD's comprehensive healthcare platform that addresses all points of a patients care from one, connected platform.
  
• On November 9, 2021, the Company announced the appointment of Duncan Hannay and Karen Adams to the Board of Directors of CloudMD.
  
• On November 15, 2021, the Company announced it had entered into a definitive agreement (the "Arrangement Agreement") with MindBeacon Holdings Inc. ("MindBeacon") pursuant to which CloudMD agreed to acquire all of MindBeacon's issued and outstanding common shares for cash and shares of the Company. Under the terms of the Arrangement Agreement, each common share of MindBeacon will be exchanged for $1.22 cash and 2.285 common shares of CloudMD. Closing of the transaction is subject to a number of customary closing conditions, including approval by at least two-thirds of the votes cast at a special meeting of MindBeacon's shareholders, as well as court and regulatory approval. The MindBeacon shareholder meeting is expected to be held on or about January 10, 2022 and, subject to the satisfaction or waiver of the other closing conditions, closing is expected to occur shortly thereafter, on or about January 14, 2022.
  
• On November 29, 2021, the Company announced it has partnered with Sun Life to expand the seven month pilot program and start rolling out its Mental Health Coach as part of Sun Life's Group Benefits offering. Findings from the pilot include (1) 89% of those experiencing depression and 91% of those experiencing anxiety noticed 'major improvements'; (2) 82% said they would recommend the service based on their own experience; and, (3) 46% increase in plan members utilizing their mental health benefits for the first time.
  

Outlook

CloudMD is creating innovation in the delivery of healthcare services, by leveraging technology to improve access to care leading to better health outcomes. Through its team-based, patient-centric approach, CloudMD provides one, connected platform for patients, healthcare practitioners, and enterprise clients to address whole-person, coordinated care. The Company has a multi-pronged growth strategy which focuses on organic growth, accretive mergers and acquisitions and leveraging assets across all divisions.

The Company's long term growth will be largely driven by: (1) continuing to integrate all its proprietary health technology solutions into its ecosystem, including the recently announced proposed acquisition of MindBeacon; (2) realizing cost savings and cross-selling opportunities to new and existing customers across CloudMD; (3) winning new customers with its unique healthcare offering and providing meaningful data driven outcomes; and (4) continuing to execute on its defined expansion strategy across North America and Globally.

CloudMD has proven out its integration strategy and by leveraging its proprietary technology, has successfully integrated all its recent acquisitions into one connected platform. In respect of the recently announced proposed acquisition of MindBeacon, CloudMD has already identified cost savings of approximately $2 million and cross-sell synergies and has started to plan the integration of MindBeacon's synergistic healthcare solutions into its mental health services offerings. In addition, the Company believes there are an additional $2 million in potential synergies available over time through the integration of MindBeacon and its other acquisitions.

CloudMD's proprietary Comprehensive Integrated Health Platform continues to see impressive adoption rates within the Enterprise Health Solutions division, and the Company has onboarded 560,000 employees and family members on the platform who are receiving individualized care. CloudMD has achieved positive client outcomes including a Net Promoter Score of 80, 98% satisfaction rate and 164 new clients added in the third quarter.

CloudMD continues to win new clients and customers including Sun Life and other large organizations in retail, transportation, and financial sectors with its industry-leading approach that delivers important outcomes that measure the patient success and engagement of its connected platform.

The technology that underpins the platform is scalable and the Company will continue looking at opportunities to expand its unique offering to clients across North America and globally. CloudMD has built an experienced sales team, and with the recent addition of Angel Paravicini, expects to drive sales and business development to open new distribution channels and attract new clients in the United States.

Upon close of the proposed acquisition of MindBeacon, CloudMD will have a strong balance sheet with over $60 million in cash and cash equivalents. The Company will continue to deploy capital towards a robust pipeline of accretive, synergistic acquisitions, focused on products, capabilities, clinical specialties, and technologies that are highly scalable and rapidly growing.

CloudMD will continue to focus on delivering meaningful shareholder value by executing on its growth strategy through the continued integration of its comprehensive healthcare offering, winning new business and clients with its unique, Comprehensive Integrated Health Platform, expansion of its scalable product across new geographies including the United States, and strategic capital allocation to drive its rapid growth.

Selected Financial Information

All results were prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.

(1) Gross profit is a non-GAAP measure as described in the Non-GAAP Financial Measures section of this news release.

(1) EBITDA is a non-GAAP measure as described in the Non-GAAP Financial Measures section of this news release.

Third Quarter 2021 Earnings Conference Call

CloudMD invites all interested parties to join the conference call or webinar:

CloudMD Q3 2021 Earnings Call
Date: Today, November 29, 2021
Time: 2:00 pm PT / 5:00 pm ET

Toll-Free Dial-In Number: (833) 562-0117
International Dial-In Number: (661) 567-1009
Conference ID: 1743143 

Webcast Link: 

Financial Statements and Management's Discussion and Analysis

This news release should be read in conjunction with the Company's condensed interim consolidated financial statements and related notes, and management's discussion and analysis ("MD&A") for the three and nine months ended September 30, 2021, and 2020, copies of which can be found under the Company's profile at www.sedar.com.

Non-GAAP Financial Measures

In addition to the results reported in accordance with IFRS, the Company uses various non-GAAP financial measures, which are not recognized under IFRS, as supplemental indicators of the Company's operating performance and financial position. These non-GAAP financial measures are provided to enhance the user's understanding of the Company's historical and current financial performance and its prospects for the future. Management believes that these measures provide useful information in that they exclude amounts that are not indicative of the Company's core operating results and ongoing operations and provide a more consistent basis for comparison between quarters and years. Details of such non-GAAP financial measures and how they are derived are provided below as well as in conjunction with the discussion of the financial information reported.

Since non-GAAP financial measures do not have any standardized meanings prescribed by IFRS, other companies may calculate these non-IFRS measures differently and our non-GAAP financial measures may not be comparable to similar titled measures of other companies. Accordingly, investors are cautioned not to place undue reliance on them and are also urged to read all IFRS accounting disclosures presented in the condensed interim consolidated financial statements and the related notes for the three and nine months ended September 30, 2021, and 2020.

EBITDA
EBITDA is a non-GAAP financial measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. EBITDA referenced herein relates to earnings before interest, taxes, depreciation and amortization. This measure does not have a comparable IFRS measure and is used by the Company to manage and evaluate the cash operating income (loss) of the business. Please refer to the "Overall Performance and Discussion of Operations – EBITDA and Adjusted EBITDA" section of the MD&A for a detailed reconciliation.

Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Adjusted EBITDA referenced herein relates to earnings before interest; taxes; depreciation; amortization; share-based compensation; financing-related costs; acquisition-related and integration costs, net; litigation costs and loss provision; change in fair value of contingent consideration; and loss from discontinued operations. This measure does not have a comparable IFRS measure and is used by the Company to evaluate its cash operating income (loss) of the business, adjusted for factors that are unusual in nature or factors that are not indicative of the operating performance of the Company. Please refer to the "Overall Performance and Discussion of Operations – EBITDA and Adjusted EBITDA" section of the MD&A for a detailed reconciliation.

Gross Profit
Gross Profit is a non-GAAP financial measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross Profit referenced herein relates to revenues less cost sales. This measure does not have a comparable IFRS measure and is used by the Company to manage and evaluate the operating performance of the business.

Gross Margin
Gross Margin is a non-GAAP financial measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross Margin referenced herein is defined as gross profit as a percent of total revenue. This measure does not have a comparable IFRS measure and is used by the Company to manage and evaluate the operating performance of the business.

About CloudMD Software & Services

CloudMD is digitizing the delivery of healthcare by providing a patient-centric approach, with an emphasis on continuity of care. By leveraging healthcare technology, the Company is building one, connected platform that addresses all points of a patient's healthcare journey and provides better access to care and improved outcomes. Through CloudMD's proprietary technology, the Company delivers quality healthcare through a holistic offering including hybrid primary care clinics, specialist care, telemedicine, mental health support, healthcare navigation, educational resources and artificial intelligence (AI). CloudMD's Enterprise Health Solutions Division includes one of the top 4 Employee Assistance Programs in Canada and offers one comprehensive, digitally connected platform for corporations, insurers and advisors to better manage the health and wellness of their employees and customers.

CloudMD currently services a combined ecosystem of over 7,000 psychiatrists, approximately 4,500 therapists and counsellors, approximately 4,000 psychologists, over 22,000 family physicians, over 34,000 medical specialists, over 1,500 allied health professionals, over 500 clinics, and over 5 million individuals across North America. For more information visit: .

ON BEHALF OF THE BOARD OF DIRECTORS

"Dr. Essam Hamza, MD"
Chief Executive Officer

FOR ADDITIONAL INFORMATION, CONTACT:

Julia Becker
VP, Investor Relations
julia@cloudmd.ca
(604) 785-0850

Forward Looking Statements

This news release contains "forward-looking statements" and "forward-looking information" within the meaning of Canadian securities laws. Forward-looking statements in this news release include, but are not limited to, statements regarding: North American and global expansion; expectations regarding gross margin increasing; payments attributable to acquisitions completed in June 2021 not reoccurring; the acquisition of MindBeacon, including anticipated timing for completion of the transaction and expected benefits, including cost savings, cross-sell and integration synergies; the Company's growth strategy, including its focus and key drivers; results of expanded sales team and business development initiatives; its expectations in respect of its balance sheet following the transaction with MindBeacon and its capital deployment plans; and its plans to deliver meaningful shareholder value. These statements are based upon information currently available to CloudMD. All information that is not clearly historical in nature may constitute forward‐looking statements. In some cases, forward‐looking statements may be identified by the use of terms such as "forecast", "assumption" and other similar expressions or future or conditional terms such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and "should". Forward-looking statements contained in this news release are based on certain factors and assumptions made by management of CloudMD based on their current expectations, estimates, projections, assumptions and beliefs regarding their business and CloudMD does not provide any assurance that actual results will meet management's expectations. While management considers these assumptions to be reasonable based on information currently available to them, they may prove to be incorrect. Such forward‐looking statements are not guarantees of future events or performance and by their nature involve known and unknown risks, uncertainties and other factors, including those risks described in the MD&A and the Company's most recent Annual Information Form (which has been filed under the Company's issuer profile on SEDAR and can be accessed at www.sedar.com), that may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward‐looking statements. Although CloudMD has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward‐looking statements, other factors may cause actions, events or results to be different than anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such forward‐looking statements. Accordingly, readers should not place undue reliance on forward‐looking information. CloudMD does not undertake to update any forward-looking information, whether as a result of new information or future events or otherwise, except as may be required by applicable securities laws.

Neither TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

¹Adjusted EBITDA and Gross Margin are non-GAAP measures as described in the Non-GAAP Financial Measures section of this news release.