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Streamline Health Solutions, Inc. (STRM)
Q3 2018 Earnings Conference Call
December 11, 2018 09:00 AM ET
Randy Salisbury - Senior Vice President and Chief Marketing Officer
David Sides - President and Chief Executive Officer
Tom Gibson - Senior Vice President and Chief Financial Officer.
Lucas Baranowski - Craig-Hallum
Frank Sparacino - First Analysis
Previous Statements by STRM
» Streamline Health Solutions, Inc. (STRM) CEO David Sides on Q2 2018 Results - Earnings Call Transcript
» Streamline Health Solutions, Inc. (STRM) CEO David Sides on Q1 2018 Results - Earnings Call Transcript
» Streamline Health Solutions' (STRM) CEO David Sides on Q4 2017 Results - Earnings Call Transcript
I would now like to turn the conference over to your host Mr. Randy Salisbury, Senior Vice President and Chief Marketing Officer for Streamline Health Solutions. Thank you. You may begin.
Thank you for joining us to review the financial results of Streamline Health Solutions for the third quarter of fiscal year 2018, which ended October 31, 2018. As the conference call operator indicated, my name is Randy Salisbury, a Senior Vice President and Chief Marketing Officer here at Streamline Health. I manage all communications, including Investor Relations. Joining me on the call today is David Sides, President and Chief Executive Officer; and Tom Gibson, Senior Vice President and Chief Financial Officer.
At the conclusion of today’s prepared remarks, we’ll open the call for our question-and-answer session. If anyone participating on today’s call, does not have a full-text copy of our press release announcing these results. You can retrieve it from the company’s website at www.streamlinehealth.net or at numerous other financial websites.
Before we begin with prepared remarks, we want to be sure we are clear for everyone on the record have certain information, which may be provided today, as with all of our earnings calls, should be viewed. We therefore submit for the record the following statement.
First, statements made on this conference call that are not historical facts are considered to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These are subject to risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from those we discuss. Please refer to the company’s press releases and filings made with the U.S. Securities and Exchange Commission, including our most recent 10-K annual report for more information about these risks, uncertainties and assumptions and other factors. As always, we are presenting management’s current analysis of these items as of today. Our participants on this call should take into account these risks when evaluating the topics we will discuss. Please note Streamline Health is not undertaking any commitment or obligation to publicly revise any such forward-looking statements made today.
Second, we will discuss non-GAAP financial measures, such as adjusted EBITDA. Management uses these measures to help provide better insight into our financial performance. However, certain items of income and expense are not included in these measures, so these calculations may differ from those, which another entity may reach using their own non-GAAP measures. To help you compare these amounts on consistent terms, please refer to our website at streamlinehealth.net and our earnings release for a reconciliation of such non-GAAP measures to the most comparable GAAP measures.
With that said, let me turn the call over to David Sides, President and Chief Executive Officer. David?
Thanks Randy. First, I want to comment on our third quarter 2018 performance, then I want to comment on what we anticipate seeing for the remainder of our fiscal year. I also want to provide some insights into our planning for our next fiscal year 2019.
With regard to the third quarter, I believe that the quarter of solid performance with the number of achievements that will contribute to building a solid foundation for sustained growth and improving profitability. Specifically, as released yesterday afternoon, for the third quarter of fiscal 2018, we generated revenues of approximately $5.4 million, a modest increase sequentially from the second quarter of this fiscal year, and down approximately 16% as compared to the same period a year ago. The decline is attributable to churn in pricing pressure on some of our legacy solutions that we expect to be offset going forward as our eValuator clients come online. More on that in a few minutes.
Recurring revenues were approximately 82% of total revenue for the third quarter, up from 79% in Q3 a year ago and about the same as the previous quarter of 83%. Our bookings for the fiscal quarter of 2018 were $1.8 million. To the first nine months of this fiscal year, our bookings are $7.1 million, which is doubled that at the same period a year ago. We are generating quality bookings and we'll continue to target between $2 million to $3 million per quarter going forward. When we combined bookings growth for quarterly sequential growth in our backlog at 13%, I believe these leading indicators point to our company turning from lower revenue to a period of revenue growth in 2019 and beyond.
The bookings in Q3 consisted primarily of two new eValuator clients, a meaningful expansion of our CDI solution with the current long-term client and the new sale of our business analytics and financial management solution suite. The two new eValuator client contracts in the quarter were Peak Health Solutions and Citizens Healthcare in the Texas.
Pipeline activity in the fourth quarter has been more pronounced in at any point in our fiscal year. We have numerous and larger contract opportunities for evaluating the pipeline and we continue to have CDI and Abstracting prospects as well. In fact, there are several individual pipeline opportunities that are four or five times what we have previously disclosed as an average deal size for eValuator.