EX-99.4 6 ex99-4.htm EX-99.4

 

Exhibit 99.4

 

Supplemental Information

 

For the Acquired Companies, we identified revenue from customers who cancelled their contracts prior to the acquisitions of such customers’ contracts. Such revenue is included in the unaudited pro-forma condensed combined statements of operations, even though CareCloud will not generate revenues from those customers.

 

Estimated revenue from customers who cancelled prior to our acquisitions

 

   Mesa   RevNu   Medsphere   Total 
   (in thousands) 
Year ended December 31, 2024  $4   $4   $3,584   $3,592 
Six months ended June 30, 2025   -    2    111    113 

 

To provide investors with additional insight and allow for a more comprehensive understanding of the information used by management in its financial and operational decision-making surrounding pro forma operations, we supplement our condensed combined financial statements presented on a basis consistent with GAAP, with adjusted EBITDA, a non-GAAP financial measure of earnings. Adjusted EBITDA represents the sum of GAAP net income (loss) before provision for income taxes, net interest expense, foreign exchange/other expense, stock-based compensation expense, depreciation and amortization, transaction and integration costs, goodwill impairment charges and lease termination and restructuring costs. Our management uses adjusted EBITDA as a financial measure to evaluate the profitability and efficiency of our business model. We use this non-GAAP financial measure to assess the strength of the underlying operations of our business. These adjustments, and the non-GAAP financial measure that is derived from them, provide supplemental information to analyze our operations between periods and over time. We find this especially useful when reviewing pro forma results of operations which include large non-cash amortization of intangibles assets from acquisitions. Investors should consider this non-GAAP financial measure in addition to, and not as a substitute for, financial measures prepared in accordance with GAAP.

 

The following tables contain a reconciliation of GAAP net income (loss) to adjusted EBITDA for the year ended December 31, 2024, and the six months ended June 30, 2025:

 

Reconciliation of GAAP net income (loss) for the year ended    

December 31, 2024 to Adjusted EBITDA    

($000)    

 

               CareCloud + Previously             
               Acquired       Pro Forma   Pro Forma 
   CareCloud   Mesa   RevNu   Subtotal   Medsphere   Adjustments   Combined 
   (in thousands) 
Net revenue  $110,837   $281   $1,880   $112,998   $39,384   $-   $152,382 
                                    
GAAP net income (loss)   7,851    4    (82)   7,773    (16,872)   13,185    4,086 
                                    
Provision for income taxes   160    -    -    160    37    -    197 
Net interest expense   812    -    -    812    7,655    (7,057)   1,410 
Foreign exchange / other expense   335    -    -    335    700    -    1,035 
Stock-based compensation expense   115    -    -    115    -    -    115 
Depreciation and amortization   14,142    -    -    14,142    4,650    (1,024)   17,768 
Transaction and integration costs (1)   46    -    -    46    -    -    46 
Goodwill impairment charges   -    -    -    -    5,104    (5,104)   - 
Lease termination and restructuring costs (2)   596    -    -    596    -    -    596 
Adjusted EBITDA  $24,057   $4   $(82)  $23,979   $1,274   $-   $25,253 

 

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Reconciliation of GAAP net income (loss) for the six months ended  

June 30, 2025 to Adjusted EBITDA    

($000)  
   

       January 1 to February 26,    January 1 to March 31,   CareCloud + Previously             
       2025   2025   Acquired       Pro Forma   Pro Forma 
   CareCloud   Mesa   RevNu   Subtotal   Medsphere   Adjustments   Combined 
   (in thousands) 
Net revenue  $55,009   $44   $477   $55,530   $16,290   $-   $71,820 
                                    
GAAP net income (loss)   4,850    1    94    4,945    (10,910)   8,748    2,783 
                                    
Provision for income taxes   83    -    -    83    11    -    94 
Net interest expense   33    -    -    33    3,873    (3,574)   332 
Foreign exchange / other expense   60    -    -    60    4,528    (5,000)   (412)
Stock-based compensation expense   219    -    -    219    -    -    219 
Depreciation and amortization   6,719    -    -    6,719    1,377    (174)   7,922 
Transaction and integration costs (1)   23    -    -    23    -    -    23 
Restructuring costs (2)   137    -    -    137    -    -    137 
Adjusted EBITDA  $12,124   $1   $94   $12,219   $(1,121)  $-   $11,098 

 

(1)The transaction and integration costs include severance amounts paid to employees from the Acquired Companies, transaction and financing costs, pre-acquisition accounting costs and legal fees and exit costs related to contractual agreements.
   
(2)The Company’s lease termination and restructuring costs represent a gain on an early termination of a lease. The Company’s restructuring costs primarily consists of severance and separation costs associated with the optimization of the Company’s operations and profitability improvements.

 

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