Streamline Health Solutions, Inc. (NASDAQ: STRM), a leading
provider of solutions that enable healthcare providers to improve
financial performance, announced today it is executing a strategic
restructuring. The strategic restructuring initiatives are designed
to reduce expenses and preserve cash while maintaining the
Company’s ability to expand its high-margin SaaS business.
As part of the strategic restructuring
initiatives, the Company has implemented a reduction in force of
approximately 26 employees (approximately 24% of its workforce).
Streamline expects to record a one-time restructuring expense of
approximately $0.8 to $1.2 million related to the reduction in
force, which includes severance payments and benefits to affected
employees. The Company expects the expense associated with the
strategic restructuring to be substantially recognized by the end
of fiscal 2023. As a result of these strategic restructuring
initiatives, the Company expects to realize annualized cost savings
of approximately $5.8 million.
The Company also announced the receipt of a
termination notice from a legacy client with an effective date of
December 31, 2023. At the time of receipt of the termination
notice, the Company was recognizing approximately $4.5 million in
annualized revenue from the legacy client. As a result of this
termination notice, the Company’s management assessed various
options and determined to accelerate the implementation of the
Company’s planned restructuring initiatives.
The Company is suspending previous guidance
related to Booked SaaS ACV and anticipates providing updates on
future expectations in conjunction with the release of its fiscal
third quarter 2023 financial results.
Management Changes
The Company also announced certain management
changes and transitions in connection with the strategic
restructuring. Effective October 13, 2023, Benjamin Stilwill has
been appointed to the position of Chief Executive Officer of the
Company. Mr. Stilwill will succeed Wyche T. “Tee” Green, III as
Chief Executive Officer of the Company, with Mr. Green
transitioning to the role of Executive Chairman at that time.
Following his transition to the role of Executive Chairman, Mr.
Green has agreed to forego a salary and will continue to serve as a
director and as Chairman of the board of directors of the
Company.
Mr. Stilwill most recently served as
Streamline’s President and, prior to that, as CEO of the Company’s
eValuator business. Mr. Stilwill was instrumental in developing a
world class client success organization within eValuator focused on
maintaining key client relationships and establishing a portfolio
of referenceable accounts. Mr. Stilwill joined Streamline in 2013
as a senior financial analyst and has held various senior roles
across the organization. Prior to joining Streamline Health, Mr.
Stilwill was a financial analyst in BMO Capital Markets’ M&A
Practice. Mr. Stilwill holds an Executive MBA from Villanova
University and a Bachelor of Arts degree in Economics from DePauw
University.
The Company also announced the appointment of
Bryant “B.J.” Reeves as the Company’s Interim Chief Financial
Officer, effective October 13, 2023. Mr. Reeves will succeed Thomas
J. Gibson as Interim Chief Financial Officer of the Company, and
Mr. Gibson will remain available to the Company through October 31,
2023 to ensure an orderly transition.
Mr. Reeves is an experienced financial and
accounting leader. Mr. Reeves joined Streamline Health in 2020 and
has held various roles in finance and accounting and most recently
served as the Company’s Chief of Staff. From 2013-2020, Mr. Reeves
held various senior accounting and finance roles at Agilysys, Inc.,
an industry-leading hospitality software solution developer. His
career also included accounting roles at McKesson Corporation from
2001-2013, and he began his career as an accountant at Lockwood
Greene in 1997. Mr. Reeves holds an MBA from Clemson University and
has been a registered Certified Public Accountant since 2008.
Management Commentary
“We executed these strategic actions to increase
our operational efficiency and ultimately thrive as an
organization,” stated Benjamin Stilwill, Chief Executive Officer.
“We have seen a significant increase in attention from our channel
partners, and strong engagement from our prospects indicating
growing demand in the marketplace for our innovative revenue cycle
solutions, which coupled with the development progress we have made
over the past 12 months within RevID should result in a broader
client base.”
“Over the past several years with Streamline, I
have witnessed an incredible evolution within our technology and
our team,” stated Tee Green, Executive Chairman. “Ben has my utmost
confidence, and I believe with his leadership this talented team
will successfully deliver tremendous impact to our nation’s health
systems.”
Conference Call
The Company will conduct a conference call later
this morning on Monday, October 16, 2023 at 9:00AM ET to provide a
corporate update. Interested parties can access the call by dialing
877-407-8291, or by joining the live webcast: click here to
register.
A replay of the conference call will be
available from Monday, October 16, 2023 at 12:00PM ET through
Monday, October 23, 2023 at 12:00PM ET by dialing 877-660-6853 or
201-612-7415 with conference ID 13742119. An online replay of the
presentation will also be available for six months following the
presentation in the Investor Relations section of the Streamline
website, www.streamlinehealth.net.
About Streamline Health
Streamline Health Solutions, Inc. (Nasdaq: STRM)
enables healthcare organizations to proactively address revenue
leakage and improve financial performance. We deliver integrated
solutions, technology-enabled services and analytics that drive
compliant revenue leading to improved financial performance across
the enterprise. For more information, visit
www.streamlinehealth.net
Safe Harbor Statement under the Private Securities
Litigation Reform Act of 1995
Statements made by Streamline Health Solutions,
Inc. that are not historical facts are forward-looking statements
that are subject to certain risks, uncertainties and important
factors that could cause actual results to differ materially from
those reflected in the forward-looking statements included herein.
Forward-looking statements contained in this press release include,
without limitation, statements regarding the Company’s growth
prospects, estimates of anticipated cash flow generation, expected
costs of and cost savings related to workforce reductions and the
anticipated period of time over which such expenses will be paid
and cost savings will be realized, industry trends and market
growth, results of investments in sales and marketing, success of
future products and related expectations and assumptions. These
risks and uncertainties include, but are not limited to, the timing
of contract negotiations and execution of contracts and the related
timing of the revenue recognition related thereto, the potential
cancellation of existing contracts or clients not completing
projects included in the backlog and Booked SaaS ACV, the impact of
competitive solutions and pricing, solution demand and market
acceptance, new solution development and enhancement of current
solutions, key strategic alliances with vendors and channel
partners that resell the Company’s solutions, the ability of the
Company to control costs, the effects of cost-containment measures
implemented by the Company, availability of solutions from third
party vendors, the healthcare regulatory environment, potential
changes in legislation, regulation and government funding affecting
the healthcare industry, healthcare information systems budgets,
availability of healthcare information systems trained personnel
for implementation of new systems, as well as maintenance of legacy
systems, fluctuations in operating results, effects of critical
accounting policies and judgments, changes in accounting policies
or procedures as may be required by the Financial Accounting
Standards Board or other similar entities, changes in economic,
business and market conditions impacting the healthcare industry
generally and the markets in which the Company operates and
nationally, the Company’s ability to maintain compliance with the
terms of its credit facilities, and other risks detailed from time
to time in the Streamline Health Solutions, Inc. filings with the
U. S. Securities and Exchange Commission. Readers are cautioned not
to place undue reliance on these forward-looking statements, which
reflect management’s analysis only as of the date hereof. The
Company undertakes no obligation to publicly release the results of
any revision to these forward-looking statements, which may be made
to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events, except as required
by law.
InvestorsJacob GoldbergerDirector, Investor
Relations and
FP&A303.887.9625jacob.goldberger@streamlinehealth.net
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