Bay Street News

Forian Inc. Announces Fourth Quarter and Full Year 2023 Financial Results

Full Year 2023 Revenue Grew 25%

Full Year 2023 Adjusted EBITDA of $2.3MM

NEWTOWN, PA, March 28, 2024 (GLOBE NEWSWIRE) — via NewMediaWire — Forian Inc. (Nasdaq: FORA), a provider of data science driven information and analytics solutions to the healthcare and life sciences industries, today announced results for the quarter and year ended December 31, 2023.

“Forian finished the year by executing against our quarterly plan and closed what was a transformational year,” stated Max Wygod, Chairman and Chief Executive Officer of Forian. “In 2023, we successfully completed a major divestiture and refocused our business on healthcare and life sciences, continued revenue growth and achieved Adjusted EBITDA ahead of schedule.”

Fourth Quarter 2023 Financial Results

Forian delivered the following results for the fourth quarter of 2023:

           
      Three Months Ended December 31,    
              Period-over-  
        2023       2022     Period %    
      Unaudited   Unaudited   Change    
Revenue     $ 5,368,932     $ 4,969,673     8 %    
                   
Loss from continuing operations, net of tax   $ (381,014 )   $ (1,900,105 )   80 %    
Income (loss) from discontinued operations, net of tax   $ 1,769,957     $ (1,656,609 )   207 %    
Net Income (loss)   $ 1,388,943     $ (3,556,714 )   139 %    
                   
Loss from continuing operations, net of tax per share – diluted $ (0.01 )   $ (0.06 )   83 %    
Income (loss) from discontinued operations, net of tax per share – diluted $ 0.05     $ (0.05 )   200 %    
Income (loss) per share – diluted   $ 0.04     $ (0.11 )   136 %    
                   
Adjusted EBITDA (a non-GAAP financial measure defined below) $ 1,033,648     $ (425,434 )   343 %    
                   

Full Year 2023 Financial Results

Forian delivered the following results for the full year 2023:

                   
      Twelve Months Ended December 31,    
              Period-over-  
        2023       2022     Period %    
      Unaudited   Unaudited   Change    
Revenue     $ 20,481,330     $ 16,418,141     25 %    
                   
Income (loss) from continuing operations, net of tax   $ 1,733,430     $ (19,191,990 )   109 %    
Income (loss) from discontinued operations, net of tax   $ 9,373,257     $ (6,779,981 )   238 %    
Net Income (loss)   $ 11,106,687     $ (25,971,971 )   143 %    
                   
Income (loss) from continuing operations, net of tax per share – diluted $ 0.05     $ (0.60 )   108 %    
Income (loss) from discontinued operations, net of tax per share – diluted $ 0.29     $ (0.21 )   238 %    
Income (loss) per share – diluted   $ 0.34     $ (0.81 )   142 %    
                   
Adjusted EBITDA (a non-GAAP financial measure defined below) $ 2,336,380     $ (6,707,809 )   135 %    

Full Year 2023 Highlights

Full Year 2024 Outlook

Based on information as of March 28, 2024, the Company is sharing the following outlook for the year ending December 31, 2024:

1 This release uses non-GAAP financial measures that are adjusted for the impact of various U.S. GAAP items. See the section titled “Non-GAAP Financial Measures” and the table entitled “Reconciliation of U.S. GAAP to Non-GAAP Financial Measures” below for details.

Quarterly Conference Call and Webcast

Forian will host a conference call and webcast at 4:30 p.m. ET on March 28, 2024 to discuss its financial results with the investment community. To register for the conference call, click here. The webcast will be available live at https://edge.media-server.com/mmc/p/w4vcipvu. This information is also available on our website at www.forian.com/investors. To be included on the Company’s email distribution list, please sign up at www.forian.com/investors.

About Forian
Forian provides a unique suite of data management capabilities and proprietary information and analytics solutions to optimize and measure operational, clinical and financial performance for customers within the traditional and emerging life sciences and healthcare payer and provider segments. Forian has industry leading expertise in acquiring, integrating, normalizing and commercializing large scale healthcare data assets. Forian’s information products overlay sophisticated data management and data science capabilities on top of a comprehensive clinical data lake to identify unique relationships, create distinctive information assets and generate proprietary insights. For more information, please visit the Company’s website at www.forian.com.

Cautionary Statements Regarding Forward-Looking Statements
This release contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance and financial condition, which may include GAAP and non-GAAP financial measures, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “target,” similar expressions and variations or negatives of these words. Forward-looking statements by their nature address matters that involve risks and uncertainties, many of which are beyond our control and are not guarantees of future results, such as statements about future financial and operating results, company strategy and intended product offerings and market positioning. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements and caution must be exercised in relying on forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, those risks and uncertainties associated with operations, strategy and goals, our ability to execute on our strategy and the additional risks and uncertainties set forth more fully under the caption “Risk Factors” in Forian’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 30, 2023, and elsewhere in Forian’s filings and reports with the SEC. Forward-looking statements contained in this release are made as of the date hereof, and we undertake no duty to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable law.

Media and Investor Contact:
forian.com/investors
ir@forian.com
267-225-6263
SOURCE: Forian Inc.

FORIAN INC.  
CONDENSED CONSOLIDATED BALANCE SHEETS  
         
  December 31,   December 31,
   2023   2022   
  (UNAUDITED)      
ASSETS        
Current assets:        
Cash and cash equivalents $ 6,042,986     $ 2,795,743    
Marketable securities   42,296,589       17,396,487    
Accounts receivable, net   2,572,931       1,809,028    
Proceeds receivable from sale of discontinued operation, net   1,645,954          
Contract assets   1,126,713       2,252,958    
Prepaid expenses   1,077,233       835,786    
Other assets   2,515,509       432,338    
Current assets of discontinued operations         1,393,688    
Total current assets   57,277,915       26,916,028    
         
Property and equipment, net   76,085       75,030    
Right of use assets, net   10,664       32,560    
Deposits and other assets   1,523,948       196,675    
Non current assets of discontinued operations         19,037,874    
Total assets $ 58,888,612     $ 46,258,167    
         
LIABILITIES AND STOCKHOLDERS’ EQUITY        
Current liabilities:        
Accounts payable $ 161,590     $ 316,105    
Accrued expenses   4,252,257       3,766,789    
Short-term operating lease liabilities   10,664       21,600    
Warrant liability   563       4,547    
Deferred revenues   2,413,551       2,581,287    
Current liabilities of discontinued operations         1,662,247    
Total current liabilities   6,838,625       8,352,575    
         
Long-term liabilities:        
Other liabilities   1,000,000       10,960    
Convertible notes payable, net of debt issuance costs ($6,000,000 in principal is held by a related party)   24,870,181       25,106,547    
Non current liabilities of discontinued operations         365,609    
Total long-term liabilities   25,870,181       25,483,116    
         
Total liabilities   32,708,806       33,835,691    
         
Commitments and contingencies        
Stockholders’ equity:        
             
Common Stock; par value $0.001; 95,000,000 Shares authorized; 30,920,450 issued and outstanding as of December 31, 2023 and 32,251,326 issued and outstanding as of December 31, 2022   30,920       32,251    
Additional paid-in capital   73,834,300       71,182,326    
Accumulated deficit   (47,685,414 )     (58,792,101 )  
Total stockholders’ equity   26,179,806       12,422,476    
Total liabilities and stockholders’ equity $ 58,888,612     $ 46,258,167    
         
         
FORIAN INC.  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
(UNAUDITED)  
                   
  For the Three Months Ended December 31,   For the Years Ended December 31,    
    2023       2022       2023       2022      
                   
Revenue $ 5,368,932     $ 4,969,673     $ 20,481,330     $ 16,418,141      
                   
Costs and Expenses:                  
Cost of revenue   1,585,550       1,196,215       5,477,032       5,049,701      
Research and development   306,923       694,263       1,407,580       4,009,769      
Sales and marketing   1,137,536       1,044,668       4,884,267       3,949,026      
General and administrative   3,240,177       3,876,700       13,633,193       16,879,858      
Separation expenses               599,832       5,417,043      
Depreciation and amortization   10,153       16,955       74,438       65,554      
Total costs and expenses   6,280,339       6,828,801       26,076,342       35,370,951      
                   
Operating loss From Continuing Operations   (911,407 )     (1,859,128 )     (5,595,012 )     (18,952,810 )    
                   
Other Income (Expense):                  
Change in fair value of warrant liability   (104 )     21,532       3,984       364,687      
Interest and investment income   661,188       154,530       2,327,974       266,213      
Gain on sale of investment               5,805,858            
Interest expense   (204,238 )     (213,059 )     (834,785 )     (846,100 )    
Gain on debt redemption               111,151            
Total other income (expense), net   456,846       (36,997 )     7,414,182       (215,200 )    
                   
(Loss) income from continuing operations before income taxes   (454,561 )     (1,896,125 )     1,819,170       (19,168,010 )    
Income taxes   73,547       (3,980 )     (85,740 )     (23,980 )    
(Loss) income from continuing operations, net of tax   (381,014 )     (1,900,105 )     1,733,430       (19,191,990 )    
                   
Loss from discontinued operations         (1,487,382 )     (94,427 )     (6,812,913 )    
(Loss) gain on sale of discontinued operations         (169,227 )     11,531,849       32,932      
Income tax effect on discontinued operations   1,769,957             (2,064,165 )          
Income (loss) from discontinued operations, net of tax   1,769,957       (1,656,609 )     9,373,257       (6,779,981 )    
Net income (loss) $ 1,388,943     $ (3,556,714 )   $ 11,106,687     $ (25,971,971 )    
                   
Net income (loss) per share                  
Basic                  
  Continuing operations $ (0.01 )   $ (0.06 )   $ 0.05     $ (0.60 )    
  Discontinued operations $ 0.05     $ (0.05 )   $ 0.29     $ (0.21 )    
Net income (loss) per share – basic $ 0.04     $ (0.11 )   $ 0.34     $ (0.81 )    
                   
Diluted                  
  Continuing operations $ (0.01 )   $ (0.06 )   $ 0.05     $ (0.60 )    
  Discontinued operations $ 0.05     $ (0.05 )   $ 0.29     $ (0.21 )    
Net income (loss) per share – diluted $ 0.04     $ (0.11 )   $ 0.34     $ (0.81 )    
                   
Weighted-average shares outstanding- basic   32,459,838       32,088,358       32,030,855       32,031,096      
                   
Weighted-average shares outstanding- diluted   32,459,838       32,088,358       32,230,845       32,031,096      
                   
FORIAN INC.            
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS            
(UNAUDITED)            
                     
    For the Years Ended December 31,            
      2023       2022              
CASH FLOWS FROM OPERATING ACTIVITIES:                    
Net income (loss)   $ 11,106,687     $ (25,971,971 )            
Less: Income (loss) from discontinued operations     9,373,257       (6,779,981 )            
Income (loss) from continuing operations     1,733,430       (19,191,990 )            
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities – continuing operations:                    
Depreciation and amortization     74,438       65,554              
Amortization on right of use asset     21,896       1,627              
Amortization of debt issuance costs     5,333       5,333              
Accrued interest on Convertible Notes     829,452       840,767              
Amortization of discount – proceeds from sale of discontinued operations     (389,288 )                  
Accretion of discount – marketable securities     (1,876,085 )     (265,443 )           `
Gain on sale of investment     (5,805,858 )                  
Gain on debt redemption     (111,151 )                  
Stock-based compensation expense     6,573,969       11,920,575              
Change in fair value of warrant liability     (3,984 )     (364,687 )            
Change in operating assets and liabilities:                    
Accounts receivable     (763,903 )     (775,451 )            
Contract assets     1,126,245       (1,196,067 )            
Prepaid expenses     (241,447 )     2,382              
Changes in lease liabilities during the period     (21,896 )     28,911              
Deposits and other assets     (1,520,022 )     496,485              
Accounts payable     (154,521 )     (131,368 )            
Accrued expenses     479,021       548,634              
Deferred revenues     (167,736 )     1,943,724              
Other liabilities     1,000,000                    
Net cash provided by (used in) operating activities – continuing operations     787,893       (6,071,014 )            
Net cash used in operating activities – discontinued operations     (59,075 )     (2,510,160 )            
  Net cash provided by (used in) operating activities     728,818       (8,581,174 )            
                     
CASH FLOWS FROM INVESTING ACTIVITIES:                    
Additions to property and equipment     (75,493 )     (47,678 )            
Purchase of marketable securities     (144,077,731 )     (55,819,346 )            
Sale of marketable securities     121,053,714       51,087,663              
Proceeds from sale of investment     5,805,858                    
Cash from sale of discontinued operations     24,413,595       (17,906 )            
Net cash provided by (used in) provided by investing activities – continuing operations     7,119,943       (4,797,267 )            
Net cash used in investing activities – discontinued operations           (1,663,778 )            
  Net cash provided by (used in) investing activities     7,119,943       (6,461,045 )            
                     
CASH FLOWS FROM FINANCING ACTIVITIES:                    
Payments on notes payable and financing arrangements           (13,122 )            
Repurchase of common stock     (3,450,053 )                
Cash used to redeem convertible notes     (960,000 )                  
Payment of employee withholding tax related to restricted stock units     (191,465 )     (87,406 )            
Net cash used in financing activities- continuing operations     (4,601,518 )     (100,528 )            
  Net cash used in financing activities     (4,601,518 )     (100,528 )            
                     
Net change in cash     3,247,243       (15,142,747 )            
                     
Cash and cash equivalents, beginning of period     2,795,743       17,938,490              
                     
Cash and cash equivalents, end of period   $ 6,042,986     $ 2,795,743              
                     
Supplemental disclosure of cash flow information                    
Cash paid for interest   $     $              
Cash paid for taxes   $ 4,066,385     $ 18,444              
                     

Non-GAAP Financial Measures

In this press release, we have provided certain non-GAAP measures, which we define as financial information that has not been prepared in accordance with U.S. GAAP. The non-GAAP financial measure provided herein is earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”), which should be viewed as supplemental to, and not as an alternative for, net income or loss calculated in accordance with U.S. GAAP (referred to below as “net loss”).

Adjusted EBITDA is used by our management as an additional measure of our Company’s performance for purposes of business decision-making, including developing budgets, managing expenditures and evaluating potential acquisitions or divestitures. Period-to-period comparisons of Adjusted EBITDA help our management identify additional trends in our Company’s financial results that may not be shown solely by period-to-period comparisons of net income. In addition, we may use Adjusted EBITDA in the incentive compensation programs applicable to some of our employees in order to evaluate our Company’s performance. Our management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items, particularly those items that are recurring in nature. In order to compensate for those limitations, management also reviews the specific items that are excluded from Adjusted EBITDA, but included in net income, as well as trends in those items.

We believe that the presentation of Adjusted EBITDA is useful to investors in their analysis of our results for reasons similar to the reasons why our management finds it useful and because it helps facilitate investor understanding of decisions made by management in light of the performance metrics used in making those decisions. In addition, as more fully described below, we believe that providing Adjusted EBITDA, together with a reconciliation of net loss to Adjusted EBITDA, helps investors make comparisons between our Company and other companies that may have different capital structures, different effective income tax rates and tax attributes, different capitalized asset values and/or different forms of employee compensation. However, Adjusted EBITDA is not intended as a substitute for comparisons based on net loss. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measures and the corresponding U.S. GAAP measures provided by each company under applicable SEC rules.

The following is an explanation of the items excluded from Adjusted EBITDA but included in net loss from continuing operations:

There are limitations to using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with U.S. GAAP and may be different from non-GAAP financial measures provided by other companies.

The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which items are adjusted to calculate our non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a U.S. GAAP basis as well as a non-GAAP basis and also by providing U.S. GAAP measures in our public disclosures.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with U.S. GAAP. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure to evaluate our business and to view our non-GAAP financial measures in conjunction with the most directly comparable U.S. GAAP financial measures.

The following table reconciles the specific items excluded from U.S. GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

FORIAN INC.  
RECONCILIATION OF US GAAP TO NON-GAAP FINANCIAL MEASURES  
(UNAUDITED)  
                 
  For the Three Months Ended December 31,   For the Years Ended December 31,  
    2023       2022       2023       2022    
                 
Revenue $ 5,368,932     $ 4,969,673     $ 20,481,330     $ 16,418,141    
                 
Net Income (loss) from continuing operations $ (381,014 )   $ (1,900,105 )   $ 1,733,430     $ (19,191,990 )  
                 
Depreciation and amortization   10,153       16,955       74,438       65,554    
Stock based compensation expense   1,653,397       1,339,555       6,573,969       11,920,575    
Change in fair value of warrant liability   104       (21,532 )     (3,984 )     (364,687 )  
Interest and investment income   (661,188 )     (154,530 )     (2,327,974 )     (266,213 )  
Interest expense   204,238       213,059       834,785       846,100    
Gain on sale of investment               (5,805,858 )        
Gain on debt redemption               (111,151 )        
Severance expense               250,000          
Litigation related expenses   281,505       77,184       1,032,985       258,872    
Income tax expense   (73,547 )     3,980       85,740       23,980    
                 
Adjusted EBITDA – continuing operations $ 1,033,648     $ (425,434 )   $ 2,336,380     $ (6,707,809 )  
                 


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