Yahoo Finance CareMax, Inc. (NASDAQ:CMAX) Q4 2023 Earnings Call Transcript
CareMax, Inc. (NASDAQ:CMAX) Q4 2023 Earnings Call Transcript March 18, 2024
CareMax, Inc. isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Good morning and welcome to CareMax' Fourth Quarter 2023 Earnings Call. Please note this call is being recorded. I would now like to turn the conference call over to Roger Ou, Senior Vice President of Investor Relations. Please go ahead.
Roger Ou: Good morning and welcome to CareMax' fourth quarter 2023 earnings call. I'm Roger Ou, Senior Vice President of Investor Relations. And I'm joined today by Carlos de Solo, our Chief Executive Officer; and Kevin Wirges, our Chief Financial Officer. During the call, we will be discussing certain forward-looking information. These forward-looking statements are based on assumptions and assessments made by CareMax' management in light of their experience and assessment of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Any forward-looking statements made during this call are made as of today; and CareMax undertakes no duty to update or revise such statements whether as a result of new information, future events or otherwise.
Important factors that could cause actual results, developments and business decisions to differ materially from the forward-looking statements are described in the company's filings with the SEC, including the section entitled Risk Factors. In today's remarks by management, we will be discussing certain non-GAAP financial metrics. A reconciliation of these non-GAAP financial metrics to the most comparable GAAP measures can be found in this morning's earnings press release. Now I'd like to turn the call over to Carlos.
Carlos de Solo: Good morning, everyone, and thank you for joining our call. Today, I will begin by talking about our near-term strategy to preserve our earnings power and liquidity given recent trends in the sector. I will then be discussing the steps we've taken to begin rightsizing our business for the current environment. Afterward, Kevin will discuss our Q4 financials. Over the course of 2023, we have navigated challenges, including some related to our rapid growth over the past couple of years and others affecting our industry overall. We met our membership targets with 111,500 Medicare Advantage members at the year-end and we met our guidance on full-year revenue. However, full-year adjusted EBITDA was unfavorably impacted by prior-year developments, increased flex card utilization and higher-than-expected medical utilization.
Additionally, as we noted last quarter, some of the unfavorability had to do with claims payment patterns which developed differently from prior years. In light of these headwinds, we have worked with our lenders to receive limited waivers on certain financial covenants contained in our credit facility in the short term. The cumulative effects of our prior year developments and rising medical expense ratios have lengthened the time in which health plans normally pay us. In the fourth quarter, we drew the remaining $60 million of our delayed-draw term loans to continue funding our operations, all while implementing cost-saving initiatives across the organization. These actions and others that we are undertaking may help bridge us to our expected MSSP payment later this year.
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