The Q1 results came in slightly below our expectations, with sales -5.7% vs ABGSCe. The Virtual Care revenue stream came in lower than we expected since the revenues from Rehabplus and Fysiotest declined q-o-q (however, Rehabplus grew 152% y-o-y on proforma basis while Fysiotest was flat). The company explained that the revenues for these entities are skewed to year-end since the customers usually make investments at the end of the year. However, the subscription revenue stream increased by 14% compared to last Q1 (Dec-Feb ‘20/’21), driven by an increase in the subscriber base. We consider this revenue stream the most important and it’s the one that Physitrack prioritizes the most. Therefore, we are very positive about the fact that the company will launch a subscription-based offering of PTCourses services on 1 June ‘22. The customers will be able to purchase PTCourses services in a bundle with Physitrack’s other platforms. We have expected the acquisition of PTCourses to lead to cross-selling and we see this as a step in the right direction. Moreover, although Physitrack has a low churn rate of 1.4%, the company has developed something called Customer Value Taskforce, the aim of which is to increase customer retention, reducing churn levels among existing customers and boosting free trial conversion in the SME segment. With this solution, the company says that the churn figures are on track to be reduced further during 2022.
Adjust Virtual Care sales and add education revenue stream
Due to the heavy investment focus among customers at year-end, we slightly lower the Virtual Care revenue stream for Q2’22e. We also split the PTCourses revenues between subscription revenues and continued education revenues. All in all, we lower sales by 2% for 2022e. Our fair value ...
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