Syra Health's Q1 Surge: 47% Growth, Eyes $11M Revenue

Key Takeaway

• Syra Health Corp. (NASDAQ: SYRA) reports a 47% revenue increase in Q1 2024, driven by significant growth in Population Health and Healthcare Workforce units.
• Secured key contracts, including a notable $660,000 agreement with a national healthcare organization, contributing to an optimistic full-year revenue forecast of $9-$11 million.
• Despite a net loss of $1.4 million and increased operating expenses, maintains a healthy cash balance of $3.2 million with no long-term debt.

Q1 Financial Performance

Syra Health Corp. reported a revenue of $1.7 million for the first quarter of 2024, marking a 47% increase from the $1.2 million recorded in the same period the previous year. This growth was significantly driven by its Population Health and Healthcare Workforce business units, which saw increases of 212% and 28% respectively. The company's newer business units, Digital Health and Health Education, also contributed to this growth, with Digital Health generating $92,250 in revenue compared to none in the previous year. Despite these gains, the gross profit margin slightly decreased to 10.2% from 12.4% in 1Q23, attributed to a shift in the mix to Healthcare Workforce.

Expansion and Contracts

Syra Health has expanded its operations across 19 states, securing several key contracts that bolster its service offerings. Notable contracts include a $660,000 agreement with a national healthcare organization for HEDIS® outreach, a $480,000 contract with the Indiana Department of Health, and a $450,000 contract for epidemiology services with the Shelby County Health Department in Tennessee. Additionally, the company was awarded a one-year contract worth approximately $250,000 by Washington D.C.'s Department of Behavioral Health to conduct an epidemiological study. These contracts, along with being selected as a subcontractor for a $75 billion federal contract, underscore the company's growing presence and credibility in the healthcare sector.

Operational and Financial Outlook

Syra Health anticipates its full-year 2024 revenue to be between $9 million and $11 million, representing a growth rate of 64%-100% compared to 2023. This optimistic outlook is supported by the company's active contracts and the expected realization of contract revenues in the latter half of 2024. However, the company reported a net loss of $1.4 million for the first quarter of 2024, an increase from the $785,892 net loss in 1Q23. Total operating expenses rose to $1.6 million, up from $921,781, due to increased salaries, benefits, and operational costs. Despite these losses, the company maintains a healthy cash balance of $3.2 million with no long-term debt.

Management Quotes

• Dr. Deepika Vuppalanchi, CEO of Syra Health:

  "We are proud of our impressive growth in 2024, as our revenues in the first quarter grew 47% versus last year. As such, we are confident in our 2024 revenue guidance of $9 million to $11 million, based on contracts in hand and pending implementation. The demand for our services remains strong and we believe we are properly positioned to take advantage. We are currently doing business in 19 states, and we anticipate securing new business from both the private and public sectors. We are excited about our Population Health business unit, which grew over 200% in the first quarter, driven by strong demand for our epidemiology services. Our growth remains strong in our newest business units of Digital Health and Health Education, and we are excited that our Healthcare Workforce business unit has returned to growth in 2024. Syrenity, our mental and behavioral health platform, which is focused on prevention, also holds great promise in terms of revenue for 2024 and beyond. We believe we are at the early stages of accelerating growth, which has been made possible by recent investments in our people and our technology."