HealthWarehouse.com Reports Full Year 2018 Results


    Press Release | 03/20/2019


    HealthWarehouse.com, Inc. (OTC: HEWA) announced today that its net sales for 2018 increased 6% to $15,748,162 compared to $14,847,262 in 2017. The 2018 annual results benefited from a strong fourth quarter during which net sales increased 18% to $4,301,612 in 2018 compared to $3,632,511 during the same period in 2017.


    HealthWarehouse.com is a Verified Internet Pharmacy Practice Sites (VIPPS) accredited online and mail-order pharmacy authorized to sell and deliver prescription medications to all 50 states. The Company attributed its 2018 sales performance to growth in core consumer prescription sales along with strong customer retention and acquisition.


    Joseph Peters, the Company’s President and CEO, said “2018 was a banner year in a number of areas, including overall and core consumer prescription revenues, prescription volumes, efficiency levels and processing times. The sales growth was in part due to once again being featured by a nationally recognized consumer magazine as the most affordable option for consumers to purchase their prescription medication. We continue to believe the article further validates our direct-to-consumer cash business model. As a result of our sales growth, along with improved efficiencies, we generated approximately $316,000 in Adjusted EBITDA during the fourth quarter.” (Adjusted EBITDA and EBITDA are non-GAAP financial measures and a reconciliation to GAAP measures is provided below.)


    “Our investment in new automation equipment during the year began to show its positive operational impact in the fourth quarter results including increased throughput, improved quality control and operating efficiencies resulting in lower fulfillment costs,” Peters added. “Our team remains dedicated to providing customers with excellent pharmacy experiences through compassion, convenience and transparency. Additionally, we continue to evaluate funding options to support an expansion of our marketing campaigns, an upgrade of our pharmacy software, and the refinancing of our current debt obligations.”


    “In wrapping up 2018, we conducted a Net Promoter Score survey to gauge the loyalty of our customer relationships. As a result, we are proud to announce a “world-class” Net Promoter Score of 77. Compared to the industry average for Online Shopping (45) and Pharmacy (28), this score highlights the success of our efforts to provide excellent pharmacy experience. Our customers noted our service, pricing, convenience, and ordering platform as key drivers for the score they gave us. As we look to 2019, we plan to build on these strong results and provide an improved customer experience by investing in pharmacy software and platform development,” Peters added.


    2018 Annual Overview:


    Net Sales: Total net sales were $15,748,162 for the year ended December 31, 2018 compared to $14,847,262 in 2017, an increase of $900,900 or 6%. Core consumer prescription sales were $12,545,097 for the year ended December 31, 2018 as compared to $10,842,910 in 2017, an increase of $1,702,187 or 16%. The growth in prescription sales has been aided by increased consumer awareness partially a result of being featured in a prominent national magazine and higher customer retention due to improved processing and service levels. Over-the-counter net sales declined by 21% to $2,707,461 as compared to $3,436,832 in 2017 due to new regulatory requirements implemented in the first quarter.


    Gross Profit: Gross profit for the year ended December 31, 2018 was $10,221,297, a $383,698 or 4% increase over the 2017 year due to sales growth.


    Operating Expenses: Operating expenses were $10,768,867 for the year ended December 31, 2018, an increase of $1,409,274 or 15% as compared to 2017. The annual results in 2018 included a $170,000 charge to write down certain fixed assets. Other increases in 2018 were related to staffing, stock-based compensation, software engineering fees, advertising, depreciation, freight and other volume-related expenses. The increase in staffing was related to higher pharmacy staffing levels during the first half of the year due to workflow changes in preparation for the automation equipment, and additional customer support and retention staffing.


    Net Income and Adjusted EBITDA: The Company reported a net loss of $817,054 for the year ended December 31, 2018, compared to net income of $371,775 for the year ended December 31, 2017. In 2018, Adjusted EBITDA was $380,428, versus $856,118 for the same period of 2017.


    2018 Fourth Quarter Overview:


    Net Sales: Total net sales were $4,301,612 for the quarter ended December 31, 2018 compared to $3,632,511 in 2017, an increase of $669,101 or 18%. Core consumer prescription sales were $3,378,308 for the quarter ended December 31, 2018 as compared to $2,619,380 in 2017, an increase of $758,928 or 29%. The growth in prescription sales during the fourth quarter benefited from higher customer retention resulting from better processing and service levels. Over-the-counter net sales declined by 18% to $707,149 for the fourth quarter of 2018 as compared to $862,927 in the same 2017 period, due the continued impact of new regulatory requirements implemented earlier in 2018.


    Gross Profit: Gross profit for the quarter ended December 31, 2018 was $2,790,774, a $360,264 or 15% increase over the 2017 fourth quarter due to sales growth.


    Operating Expenses: Operating expenses were $2,933,660 for the quarter ended December 31, 2018, an increase of $359,538 or 14% as compared to the same quarter in 2017. The quarterly results in 2018 included a $170,000 charge to write down certain fixed assets. Other increases in 2018 were related to accounting services, staffing, stock-based compensation, freight and other volume-related expenses. The increase in staffing was related to additional customer support and retention staffing, which was offset by lower pharmacy staffing resulting from efficiency gains from the automation equipment.


    Net Income and Adjusted EBITDA: The Company reported a net loss of $215,964 for the fourth quarter of 2018 compared to a net loss of $175,879 during the same period in 2017. For the fourth quarter, Adjusted EBITDA was $315,716 in 2018 compared to $23,210 in 2017.


    HEALTHWAREHOUSE.COM, INC. AND SUBSIDIARIES


    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


    Consolidated Statements of Operations

    Reconciliation of Net Income (Loss) (GAAP) to Adjusted EBITDA (Non-GAAP)


    Reconciliation of Net Income to Adjusted EBITDA

    About HealthWarehouse.com


    HealthWarehouse.com, Inc. (OTC Pink:HEWA) is a trusted VIPPS accredited online pharmacy based in Florence, Kentucky. The Company is focused on the out of pocket prescription market, which is expected to exceed $50 billion in 2019. With a mission to provide affordable healthcare to every American by focusing on technology that is revolutionizing prescription delivery, HealthWarehouse.com has become the largest VIPPS accredited online pharmacy in the United States exclusively servicing the cash market.


    HealthWarehouse.com is licensed or authorized to ship prescription medication to all 50 states and only sells drugs that are FDA-approved and legal for sale in the United States. Visit HealthWarehouse.com online at http://www.HealthWarehouse.com.


    Forward-Looking Statements


    This announcement and the information incorporated by reference herein contain “forward looking statements” as defined in federal securities laws, including but not limited to Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995, which statements are based on our current expectations, estimates, forecasts and projections. Statements that are not historical facts, including statements about the beliefs, expectations and future plans and strategies of the Company, are forward-looking statements. Actual results may differ materially from those expressed in forward looking statements or in management's expectations. Important factors which could cause or contribute to actual results being materially and adversely different from those described or implied by forward looking statements include, among others, risks related to competition, management of growth, access to sufficient capital to fund our business and our growth, new products, services and technologies, potential fluctuations in operating results, international expansion, outcomes of legal proceedings and claims, fulfillment center optimization, seasonality, commercial agreements, acquisitions and strategic transactions, foreign exchange rates, system interruption, cyber-attacks, access to sufficient inventory, government regulation and taxation, payments and fraud. More information about factors that potentially could affect HealthWarehouse.com's financial results is included in HealthWarehouse.com's audited Annual Reports and Quarterly Reports available at otcmarkets.com and prior filings with the Securities and Exchange Commission.


    Use of Non-GAAP Financial Measures


    HealthWarehouse.com, Inc. (the "Company") prepares its consolidated financial statements in accordance with the United States generally accepted accounting principles ("GAAP"). In addition to disclosing financial results prepared in accordance with GAAP, the Company discloses information regarding Adjusted EBITDA, which is commonly used. In addition to adjusting net loss to exclude interest, depreciation and amortization, Adjusted EBITDA also excludes stock-based compensation, and certain other nonrecurring charges. Adjusted EBITDA is not a measure of performance defined in accordance with GAAP. However, Adjusted EBITDA is used internally in planning and evaluating the Company`s performance. Accordingly, management believes that disclosure of this metric offers investors, bankers and other shareholders an additional view of the Company`s operations that, when coupled with the GAAP results, provides a more complete understanding of the Company’s financial results.


    Adjusted EBITDA should not be considered as an alternative to net loss or to net cash used in operating activities as a measure of operating results or of liquidity. It may not be comparable to similarly titled measures used by other companies, and it excludes financial information that some may consider important in evaluating the Company`s performance.


    View source version on businesswire.com.


    Our Happy Customers

    • “I'm very happy with the service and appreciate how simple the process was.Thank you for making something potentially stressful into something so simple.”

      Darling G. 

    • “Excellent response and timely shipment to my orders. Thanks”

      Richard H.  Nicholasville, KY.

    • “Your staff helped me in refilling the medication without any problem.”

      Chandran. 

    VIPPS Accredited & Certified

    HealthWarehouse.com is a VIPPS accredited pharmacy based in Florence, Kentucky. We're licensed and/or authorized to sell prescriptions in all 50 states and the District of Columbia and have become America’s Trusted Online Pharmacy since 2008. For more information about how we’re revolutionizing pharmacy, one prescription at a time, click here.

    VIPPS