Change Healthcare Inc. (CHNG) on Q4 2021 Results - Earnings Call Transcript
Operator: Good day, and thank you for standing by. Welcome to the Change Healthcare Fourth Quarter Fiscal Year 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. I would now like to hand the conference over to your speaker today, Evan Smith, Senior Vice President of Investor Relations. Please go ahead.
Evan Smith: Thank you, operator. Good morning, and welcome to Change Healthcare's earnings call for the fourth quarter of fiscal 2021, which ended on March 31, 2021. I'm joined today by Neil de Crescenzo, Change Healthcare's President and CEO; and Fredrik Eliasson, Change Healthcare's Executive Vice President and Chief Financial Officer. First, Neil will provide a business update, and then Fredrik will review the financial results for the quarter, followed by closing remarks from Neil. Given the pending transaction with OptumInsight, we will not be taking questions or providing financial guidance.
Neil de Crescenzo: Thank you, Evan. Good morning, everyone. I want to take a moment to recap a year that demonstrated the resiliency of our company and the healthcare system as a whole. Headed into the fiscal year, we quickly responded to COVID-19 pivoting our working model and business to support our customers' needs. Change Healthcare's experience, scale and insight allowed us to contribute to dozens of research, disease tracking and virtual care efforts that were caused are accelerated by the COVID-19 pandemic. Despite the hardships facing our communities, our team continued to plan for the future while navigating the present. We delivered on our strategy quickly developing new solutions to support our customers as they accelerated their virtual health, interoperability and other key initiatives throughout the year, while continuing to focus on our long-term investments. As a company, we make critical decisions on a timely basis and offered new resources to support our team members, customers and partners in order to enable everyone to effectively execute their goals, while improving access and efficiency in the healthcare system for consumers. We developed disruptive solutions to improve healthcare, including our industry-leading Data Science as a Service or DSaaS offering. DSaaS drives improved outcomes in healthcare economics for vulnerable health populations. We also advanced our e-commerce Shop Book and Pay solution and Clearance Estimator Patient Direct solution to help providers comply with the CMS price transparency rule and enhanced patient or member engagement.
Fredrik Eliasson: Thank you, Neil. Good morning, everyone. The fourth quarter and full-year results demonstrate the resiliency of our business and the underlying strength of our core franchises as we continue to make significant investments across the platform, deepen our relationships with customers and rollout new innovative solutions. As we stated previously, we believe the recovery in activity levels was a result of the trend towards more normal underlying demand and some catch-up of previously deferred visits and procedures. As Neil also mentioned, we continue to see underlying strength in our sales efforts across the platform, including positive market reception for our newly introduced solutions. Let me now move on to provide more details of our quarterly performance for the fourth quarter of fiscal 2021. Starting with Slide 6. For the fourth quarter, solutions revenue was $804 million, including a deferred revenue adjustment of $10 million as part of the fair value adjustments associated with the McKesson exit compared to $787 million in the same period of the prior fiscal year. We continued to see momentum in our business with positive bookings and pipeline activity across all three segments. Solutions revenue for the current period reflects $10.7 million net favorable impact from acquisitions and divestitures. The quarter was positively impacted by new sales volume across all three segments. Net of the impact of deferred revenue and the net revenue related to acquisitions and divestitures in each period, solutions revenue increased 2.2%, a sequential improvement and solid foundation as we move into fiscal 2022.
Neil de Crescenzo: Thank you, Fredrik. Over the past several years, Change Healthcare has developed and delivered innovative and transformative solutions for care providers, healthcare payers and consumers to improve clinical, financial and care outcomes so that everyone in the healthcare system can thrive. We remain focused on three outcomes for our stakeholders. First, we will deliver superior consumer experiences and make the healthcare experience as positive as possible for everyone. Second, we will drive increased efficiency and accuracy for financial transactions in the healthcare industry. We will help our customers make payments and help them get paid quickly and correctly. And third, we will deliver solutions that optimize decision making for our customers on their journey to value-based care. We will help our customers navigate the changing healthcare landscape more easily and effectively. I remain incredibly proud of what our company has accomplished, and I am grateful to our employees for their hard work, dedication and contributions. Thanks to the dedication of the Change Healthcare team members, I remain confident that we will continue to deliver innovation and value to our customers and the communities we serve, helping them navigate the current market environment and future opportunities to lower cost, enhanced access and improved outcomes.
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Neil de Crescenzo: Thank you for attending our earnings call today.
