CorVel Corp (CRVL) 2023 Q3 法說會逐字稿

Thank you for standing by. Welcome to the CorVel Corporation quarterly earnings release webcast.

謝謝你的支持。歡迎收看 CorVel Corporation 季度收益發佈網絡廣播。

During the course of this webcast, CorVel Corporation may make projections or other forward-looking statements regarding future events or the future financial performances of the company. CorVel wishes to caution you that these statements are only predictions and that actual events or results may differ materially. CorVel refers you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the company's last Form 10-K and 10-Q files for the most recent fiscal year and quarter. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

在此網絡廣播過程中，CorVel Corporation 可能會就未來事件或公司未來的財務業績做出預測或其他前瞻性陳述。 CorVel 提醒您，這些陳述只是預測，實際事件或結果可能存在重大差異。 CorVel 指的是公司不時向美國證券交易委員會提交的文件，特別是公司最近一個財政年度和季度的 10-K 表格和 10-Q 表格文件。這些文件包含並確定了可能導致實際結果與我們的預測或前瞻性陳述中包含的結果存在重大差異的重要因素。

I would now like to turn the call over to Mr. Michael Combs, Chief Executive Officer and President.

我現在想把電話轉給首席執行官兼總裁邁克爾·庫姆斯先生。

Good morning. Thank you for joining us to review CorVel's December quarter. On the call with me today is Brandon O'Brien, CorVel's Chief Financial Officer. Today, I will discuss business performance, the current environment, market trends and the progress we've achieved with our systems development. Brandon will then provide additional details on the financial results for the December quarter.

早上好。感謝您與我們一起回顧 CorVel 的 12 月季度。今天與我通電話的是 CorVel 的首席財務官 Brandon O'Brien。今天，我將討論業務績效、當前環境、市場趨勢以及我們在系統開發方面取得的進展。布蘭登隨後將提供有關 12 月季度財務業績的更多詳細信息。

The December quarter revenues were $179 million, 9% over the $165 million of revenue for the December 2021 quarter. Earnings per share for the quarter were $0.96, increasing 25% from $0.76 per share in the same quarter of the prior year. The results for the December quarter reflect the progress made addressing the staffing imbalances, which I reviewed in the prior release. The improvements have been achieved while prioritizing the quality and consistency of the work we perform for our partners.

12 月季度的收入為 1.79 億美元，比 2021 年 12 月季度的 1.65 億美元收入增長 9%。本季度每股收益為 0.96 美元，較上年同期的每股收益 0.76 美元增長 25%。 12 月季度的結果反映了在解決人員配置失衡方面取得的進展，我在之前的發布中對此進行了審查。這些改進是在優先考慮我們為合作夥伴執行的工作的質量和一致性的同時實現的。

CorVel's development road map includes increased automation and augmentation, which will further optimize bottom line results and improve the outcomes we deliver. CERiS, which serves the commercial health market contributed strong results for the quarter. The results were achieved despite temporarily reduced transaction volume from key partners early in the quarter due to adjustments to the client's internal workflow processes. The reduction in volume experienced is appropriately categorized as deferred work, which we expect to process in the coming quarters.

CorVel 的發展路線圖包括增加自動化和增強，這將進一步優化底線結果並改善我們提供的結果。服務於商業健康市場的 CERiS 為本季度貢獻了強勁的業績。儘管由於客戶內部工作流程的調整，本季度初主要合作夥伴的交易量暫時減少，但仍取得了成果。所經歷的數量減少被適當地歸類為延期工作，我們預計將在未來幾個季度進行處理。

The workers' compensation markets for managed care and claims management remain active. Our Enterprise Comp claims management solution benefited from increasing market recognition of the results being achieved for our partners. Calendar year 2022 was significant as we reached record new sales as well as record revenues for the EC business. We were also recognized by Business Insurance for the Innovation Award of the Year as well as TPA Team of the Year.

管理式醫療和理賠管理的工傷賠償市場仍然活躍。我們的 Enterprise Comp 索賠管理解決方案受益於市場對我們合作夥伴取得的成果的日益認可。 2022 年意義重大，因為我們的 EC 業務實現了創紀錄的新銷售額和創紀錄的收入。我們還獲得了 Business Insurance 的年度創新獎和 TPA 年度團隊獎。

Investments in system enhancements for the managed care carrier business have been incremental and consistent over the last several years and are now beginning to yield returns with multiple new carriers being onboarded this year. CorVel Systems, tenured operations team and quality of engagement combined to provide results that are unique in the industry. Building on the current momentum will continue to be a focus this year.

在過去幾年中，對管理式醫療運營商業務系統增強的投資一直在增加和持續，並且隨著今年多家新運營商的加入，現在開始產生回報。 CorVel Systems、終身運營團隊和參與質量相結合，提供了業內獨一無二的成果。在當前勢頭的基礎上，今年仍將是一個重點。

During the last several years, there has been an unprecedented amount of M&A consolidation in the payment integrity market, resulting in limited options from which the market can choose. The strong financial foundation of CorVel provides shelter from the consequences of M&A activity, many vendors in the industry are facing in the current economy and the level of stability that is uncommon in the industry.

在過去幾年中，支付誠信市場出現了空前數量的併購整合，導致市場可供選擇的選項有限。 CorVel 強大的財務基礎為併購活動的後果提供了庇護，該行業的許多供應商都面臨著當前的經濟和行業中罕見的穩定性水平。

CERiS is proud to provide quality service, increased savings, consistency and improved results to our partners, while reducing friction with the provider community. We are continuing to broaden our portfolio of AI-powered services, most recently in specialty care reviews, and we'll be rolling out additional offerings in the coming quarters. M&A throughout all industry supply chains exacerbate the complexities of managing order fulfillment and cash flow.

CERiS 很自豪能夠為我們的合作夥伴提供優質服務、增加儲蓄、一致性和改進結果，同時減少與供應商社區的摩擦。我們將繼續擴大我們的人工智能服務組合，最近是在專業護理評論方面，我們將在未來幾個季度推出更多產品。貫穿所有行業供應鏈的併購加劇了管理訂單履行和現金流的複雜性。

Our revenue cycle management arm, Symbeo, uses AI-driven business rules and accounts payable automation solutions, which we have offered for more than 20 years. We help customers accelerate change management with faster invoice cycle times, consolidate financial reporting, hierarchical workflow approvals, a demonstrated ROI and an enhanced overall experience.

我們的收入周期管理部門 Symbeo 使用人工智能驅動的業務規則和應付賬款自動化解決方案，我們已經提供了 20 多年。我們幫助客戶通過更快的發票週期時間、合併財務報告、分層工作流批准、證明的投資回報率和增強的整體體驗來加速變更管理。

It is well understood that comorbidities have a significant impact on recovery and return to work for employees with workers' compensation injuries. However, one that has most recently been in the spotlight is mental health. While studies have found that most injured workers do not have previously diagnosed psychiatric disorders, there are multiple psychosocial barriers that can increase the total cost of a claim as well as the length of time away from work, including perceived injustice, fear and pain.

眾所周知，合併症對工傷賠償員工的康復和重返工作崗位有重大影響。然而，最近備受關注的一個問題是心理健康。雖然研究發現大多數受傷工人之前沒有被診斷出精神疾病，但存在多種心理社會障礙，可能會增加索賠的總成本以及遠離工作的時間長度，包括感知到的不公正、恐懼和痛苦。

During 2022, 4 states enacted legislation for coverage of mental health injuries in workers' compensation, and there are over a dozen additional states considering legislation and over 50 bills currently in progress. We expect to hear much more about this topic in the coming months and quarters. Although specific mental health problems may not be directly related to a work injury, employers are increasingly realizing the benefits of promoting positive mental health in the workplace.

2022 年期間，有 4 個州頒布了在工傷賠償中涵蓋精神健康傷害的立法，還有十多個州正在考慮立法，目前有 50 多個法案正在製定中。我們希望在未來幾個月和幾個季度聽到更多關於這個話題的信息。雖然特定的心理健康問題可能與工傷沒有直接關係，但雇主越來越意識到在工作場所促進積極心理健康的好處。

At CorVel, care advocates work to identify evolving mental health issues related to work injuries within the first 30 days of the injury and beyond. Our team works with employers to offer education and to develop holistic treatment plans that promote mental well-being during recovery. Online resources and digital therapy can bridge the access gap for employees and bring care into their living rooms and workplaces. Case managers and treating physicians are able to provide patient education tools on topics, such as managing anxiety, preventing social isolation and effective coping mechanisms to provide more rapid recovery and return to work.

在 CorVel，護理倡導者致力於在受傷後的前 30 天內及以後確定與工傷相關的不斷發展的心理健康問題。我們的團隊與雇主合作，提供教育並製定整體治療計劃，以促進康復期間的心理健康。在線資源和數字療法可以彌合員工的訪問差距，並將護理帶入他們的客廳和工作場所。個案管理員和主治醫師能夠提供有關主題的患者教育工具，例如管理焦慮、防止社會孤立和有效的應對機制，以提供更快的康復和重返工作崗位。

During the quarter, CorVel has continued our efforts in digital transformation, most recently in the area of document management. Documents are pervasive in much of CorVel's business, a meaningful amount of time is spent by adjusters, professional review nurses, case managers and bill review team members reviewing documentation to identify key information. The documents we receive contain a wealth of information that when intentionally reviewed plays an important role in facilitating optimal outcome for our partners and their workers with injuries.

在本季度，CorVel 繼續努力進行數字化轉型，最近是在文檔管理領域。文檔在 CorVel 的大部分業務中無處不在，理算員、專業審查護士、個案經理和賬單審查團隊成員花費了大量時間來審查文檔以確定關鍵信息。我們收到的文件包含大量信息，經過有意審查後，這些信息在促進我們的合作夥伴及其受傷工人的最佳結果方面發揮著重要作用。

As part of our ongoing quest to deliver these increasingly improved outcomes through the application of artificial intelligence and automation, we're introducing a new proprietary document storage and processing solution based on the latest advances in cloud-based AI technologies. While our philosophy is to own all core systems, we are pragmatic about leveraging compelling cloud-based services as they emerge in the technological landscape.

作為我們不斷尋求通過應用人工智能和自動化來提供這些日益改進的結果的一部分，我們正在引入一種新的專有文檔存儲和處理解決方案，該解決方案基於基於雲的 AI 技術的最新進展。雖然我們的理念是擁有所有核心系統，但我們務實地利用引人注目的基於雲的服務，因為它們出現在技術領域。

Previously, models for ML and AI had to be built in-house by our own systems architects and data scientists. But flavors of these services are becoming increasingly ubiquitous. We believe that leveraging valuable and mature cloud-based solutions will amplify the work of our team and allow progress to be made more quickly. The aforementioned new solution for document digitization in addition to reliably storing and handling documents quickly will enhance our ability to extract valuable data by providing our teams with powerful new tools that choose AI to highlight key information, direct attention to the most impactful details and make it simpler to both share information and to take decisive action.

以前，ML 和 AI 的模型必須由我們自己的系統架構師和數據科學家在內部構建。但這些服務的特色正變得越來越普遍。我們相信，利用有價值且成熟的基於雲的解決方案將擴大我們團隊的工作，並使進展更快。上述用於文檔數字化的新解決方案除了可靠地存儲和快速處理文檔外，還將通過為我們的團隊提供強大的新工具來增強我們提取有價值數據的能力，這些工具選擇 AI 來突出顯示關鍵信息，直接關注最具影響力的細節並使其成為現實。更容易共享信息和採取果斷行動。

Improvements like this are critical to the overall efforts to increase automation and augment the work of all of our team members. Reducing and eliminating tasks that are repetitive and menial, elevates the work of the team and provides better results to our partners.

像這樣的改進對於提高自動化和增強我們所有團隊成員的工作的整體努力至關重要。減少和消除重複和瑣碎的任務，提升團隊的工作，並為我們的合作夥伴提供更好的結果。

Brandon will now provide additional details on the financial results for the December quarter. Brandon?

Brandon 現在將提供有關 12 月季度財務結果的更多詳細信息。布蘭登？

Thank you, Michael, and good morning, everyone. As Michael indicated at the top of the call, revenue for the December quarter was $179 million, up 9% from the same quarter of the prior year. Earnings per share were $0.96, a 25% increase from the $0.76 per share in the same quarter of the prior year. The revenue for patient management, including third-party administration, TPA services and traditional case management for the December quarter was $119 million, an annual increase of 10%. Gross profit increased 17% from the December quarter of 2021.

謝謝邁克爾，大家早上好。正如邁克爾在電話會議開頭所指出的那樣，12 月季度的收入為 1.79 億美元，比去年同期增長 9%。每股收益為 0.96 美元，較上年同期的每股收益 0.76 美元增長 25%。患者管理的收入，包括第三方管理、TPA 服務和傳統病例管理，在 12 月季度為 1.19 億美元，年增長率為 10%。毛利潤比 2021 年第 12 季度增長 17%。

Our operations, especially those providing patient management services, have been focused on the alignment and adjustment of staffing needs as we roll out AI-assisted processes throughout the organization. Those solutions offer operational efficiencies, while prioritizing our strong quality of engagement, results and outcomes for our partners.

隨著我們在整個組織中推出人工智能輔助流程，我們的運營，尤其是那些提供患者管理服務的運營，一直專注於人員配置需求的調整和調整。這些解決方案可提高運營效率，同時優先考慮我們為合作夥伴提供的強大參與質量、成果和成果。

The revenue for Network Solutions sold in the wholesale market during the December quarter was $60 million, a 6% increase from the same quarter of the prior year. Gross profit in the wholesale business was up 13% from the December quarter of 2021. CERiS continues to increase the breadth of services offered to our large health care partners contributing to year-over-year December quarter revenue increases. The timing and expansion of new offerings during the quarter were beneficial in offsetting the expected short-term reduced transaction volume from key partners, which Michael had mentioned earlier.

Network Solutions 在 12 月季度在批發市場銷售的收入為 6000 萬美元，比去年同期增長 6%。批發業務的毛利潤比 2021 年第 12 季度增長了 13%。CERiS 繼續擴大為我們的大型醫療保健合作夥伴提供的服務範圍，這有助於 12 月季度收入的同比增長。本季度新產品的時機和擴展有利於抵消邁克爾之前提到的主要合作夥伴預期的短期交易量減少。

Since inception, CorVel's actions have been guided by a long-term view of success and the sustained financial health of the organization. The approach has allowed us to grow in times of economic expansions and recessions. Our balance sheet, strategic initiative road map and operational fundamentals are healthy, allowing us to not only weather but thrive in unusual economic times.

自成立以來，CorVel 的行動一直以長期的成功觀和組織的持續財務健康為指導。這種方法使我們能夠在經濟擴張和衰退時期實現增長。我們的資產負債表、戰略計劃路線圖和運營基礎是健康的，使我們不僅能夠在不尋常的經濟時期度過難關，而且還能蓬勃發展。

I would now like to review a few additional financial items. During the quarter, the company repurchased 152,000 shares at a total cost of $22.8 million. From inception to date, the company has repurchased 37.7 million shares at a total cost of $730 million. Through the program, the company has repurchased 69% of the total shares outstanding. The repurchasing of shares continues to be funded via the company's strong operating cash flow. Our DSO, as in days sales outstanding, of receivables was 42 days, up 3.5% from a year ago.

我現在想審查一些額外的財務項目。本季度，該公司以 2280 萬美元的總成本回購了 152,000 股股票。自成立至今，公司已回購 3770 萬股股票，總成本為 7.3 億美元。通過該計劃，公司回購了已發行股份總數的 69%。股票回購繼續由公司強勁的經營現金流提供資金。我們的 DSO（按未完成銷售天數計算）應收賬款為 42 天，比去年同期增長 3.5%。

The quarter ending cash balance was $78 million. CorVel's strong and debt-free balance sheet generates improved earnings in contrast to many others in the segment facing increased debt loads and associated interest rate cost headwinds.

季度末現金餘額為 7800 萬美元。 CorVel 強勁且無債務的資產負債表產生了更好的收益，這與該領域的許多其他面臨債務負擔增加和相關利率成本逆風的公司形成鮮明對比。

That concludes our remarks for today. Thank you for joining us. I'll now return the call to our operator.

我們今天的發言到此結束。感謝您加入我們。我現在將電話返回給我們的接線員。

This concludes today's webcast. You may disconnect your lines at this time.

今天的網絡廣播到此結束。此時您可以斷開線路。