|For immediate release|
|November 13, 2020|
Digirad Corporation Reports Financial Results for the
Third Quarter and Nine Months Ended September 30, 2020
Suwanee, GA. - Digirad Corporation (Nasdaq: DRAD; DRADP) (“Digirad” or the “Company”) reported today its financial results for the third quarter (Q3) and nine months (9M) ended September 30, 2020.
Q3 2020 Financial Highlights vs. Q3 2019*
•Total revenue increased to $30.4 million from $28.3 million
•Gross profit decreased to $4.8 million from $5.2 million
•Net loss from continuing operations was $1.8 million (or $0.37 per basic and diluted share) compared to a net loss of continuing operations $1.5 million (or $0.74 per basic and diluted share) **
•Non-GAAP adjusted EBITDA from continuing operations decreased to $1.1 million from $2.0 million
•Non-GAAP free cash outflow of $2.2 million versus inflow of $0.4 million
•Cash and cash equivalents and restricted cash of $4.4 million versus $1.7 million and net debt of $18.9 million versus $21.4 million
9M 2020 Financial Highlights vs. 9M 2019*
•Total revenue increased to $81.6 million from $78.0 million
•Gross profit decreased to $13.3 million from $14.2 million
•Net loss from continuing operations was $6.0 million (or $1.83 per basic and diluted share) compared to a net loss from continuing operations of $4.6 million (or $2.27 per basic and diluted share) **
•Non-GAAP adjusted EBITDA from continuing operations decreased to $3.4 million from $4.9 million
•Non-GAAP free cash outflow of $2.3 million versus inflow of $1.6 million
* Since September 10, 2019, Digirad has been operating as a diversified holding company (“HoldCo”) with three divisions: Healthcare, Building & Construction, and Real Estate & Investments. Digirad’s Q3 2020 and 9M 2020 results include financial and operational data for the two newly created divisions - Building & Construction and Real Estate & Investments. Partial operational and financial data were recorded in the 2019 corresponding periods for these two divisions.
** In May 28, 2020, Digirad completed a public offering through the issuance of 2,225,000 shares of its common stock. Per share amounts for Q3 2020 and 9M 2020 periods, reflect the new share count. For the nine months ended September 30, 2020, there were 395,140 warrants exercised and converted into 197,570 shares of common stock.
Subsequent to the end of the quarter, the Company entered into a Stock Purchase Agreement (“Agreement”) with Knob Creek Acquisition Corp., to sell its DMS Health Technologies, Inc. (“DMS Health”) business unit. The initial purchase price under the Agreement is $18.75 million. The Agreement is subject to customary closing conditions and is expected to close in January 2021.
Jeff Eberwein, Chairman of Digirad, noted, “Our Q3 2020 operating and financial results continued to be impacted by the slowdown due to COVID-19. Although doctor offices and hospitals started to return to normal operations in Q3, activity levels remained below normal during the quarter, causing our Healthcare division’s revenue and gross profit to be lower than the prior year quarter. Our Diagnostic Services business has begun to rebound, but our Diagnostic Imaging business has seen a slowdown in camera sales due to purchase delays related to capital funding decisions driven by the pandemic.”
“Our Building & Construction division has significant momentum as shown by Q3 revenue increasing 70% versus the preceding quarter. KBS Builders, Inc. (“KBS”), our modular building manufacturing business focused on the Northeast, increased production at its South Paris, Maine plant in Q3 due to recently won commercial projects. In addition, KBS recently re-opened an ancillary building at its previously idle Oxford, Maine plant to manufacture wall panels for the New England market, creating a new business line for KBS. Because of the strong demand outlook for KBS, we are studying ways to increase our production capacity and are excited about the outlook for this business.”
The following information was filed by Digirad Corp (DRAD) on Friday, November 13, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.