Numinus Reports Q4 & Full Year Fiscal 2023 Results, Including Greatly Reduced Cash Burn Rate
Psychedelic therapy clinic provider Numinus Wellness (TSX: NUMI) (OTCQX: NUMIF) announced fourth quarter and full year fiscal 2023 results Wednesday after market. The numbers show demonstrable growth on a year-over-year basis, plus reduced cash burn rate for the month of October down to previously elucidated targets.
Zooming out to the broader fiscal year 2023, Numinus reported achievements that underscored its overall growth and influence in the psychedelic therapy space. The company’s revenue for the entirety of fiscal 2023 amounted to $23.2 million—an year-over-year increase of 256.9%. A good portion of this increase is attributable to the company’s Novamind acquisition in June 2022, boosted by organic growth in key clinic segments.
For the fiscal year, Numinus Wellness Clinics pulled in the vast amount of revenue-generating activities by providing an 82,373 client appointments overall. Wellness clinics generated revenue of $5.0 million during Q4 2023, a 34.6% year-over-year increase from $3.7 million during Q4 2022, and consistent with revenues of $5.0 million during Q3 2023, despite typical Q4 seasonality effects.
Over the course of fiscal year 2023, the annual gross margin stood at 36.1%, marking a 27.4% increase recorded in fiscal year 2022. This upward shift in the annual gross margin is attributable to an augmentation in client appointments and enhanced clinic utilization.
The launch of the Numinus Certification Pathway to train and certify psychedelic therapy practitioners was another significant milestone, attracting over 400 unique applicants since its inception. Additionally, Numinus facilitated 36 clinical research trials, collaborating with leading psychedelic drug development companies.
One of the significant developments during this quarter was Numinus’ strategic partnership with the Multidisciplinary Association for Psychedelic Studies (MAPS). This collaboration granted Numinus the permission to utilize the MAPS protocol for offering MDMA-assisted therapy experiential opportunities for practitioners.
Additionally, Numinus practitioner training witnessed an expansion by doubling the cohort in its Fundamentals of Psychedelic Assisted Therapy (PAT) course.
Q4 2023 Highlights
In the fourth quarter, Numinus experienced a 1.7% growth in revenues compared to the prior quarter, reaching $6.1 million. This uptick was attributed to the accelerated deployment of services in both the United States and Canada.
Despite the revenue growth, the gross margin sequentially declined by 500 basis points, settling at 29.5% in Q4 2023 compared to 34.5% in Q3 2023. This dip was influenced by the strategic decision to transition to a higher number of full-time practitioners (as opposed to part-time contractors) and the performance variations observed in specific clinic locations.
Operating expenditures in Q4 2023 amounted to $7.9 million, showcasing a reduction from the previous quarter’s $9.2 million. The company diligently pursued its cost containment initiative during the quarter, realigning operations to prioritize revenue-generating activities and extend its cash runway.
The wellness clinics proved to be a significant contributor to revenue generation, yielding $5.0 million during Q4 2023. This marked a 34.6% year-over-year increase from the $3.7 million reported in Q4 2022. Notably, despite the usual seasonality effects observed in Q4, revenues from the wellness clinics remained consistent with the preceding quarter’s figure of $5.0 million.
Additionally, the company observed a sequential increase of 14.2% in revenues from CCR (Costa Rican operations) during Q4 2023, amounting to $1.2 million.
Clinic Engagements Stable Sequentially
During the fourth quarter of 2023, the company scheduled 21,068 clinical appointments, showcasing a slight decrease from the 21,520 appointments in the previous quarter, Q3 2023. Despite this marginal decline (owing to the consolidation of clinic assets), the company averaged 345.4 appointments per operating day in Q4 2023 compared to 331.1 in Q3 2023.
Cash Burn Decreases In October To Previously Stated Target
On the all-important subject of cash burn, Numinus has significantly reduced the burn rate in October towards its previously-stated goal.
The company reports that proactive measures taken, including cost containment initiatives in Q3 2023, has led to a significant reduction in annualized cash expenses, thereby contributing to the sustained decrease in the cash burn rate to under $1 million per month. With burn rate under relative control, Numinus focus shifts to profitability and ensuring sustainability with its current operations.
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