Vitalhub (VHI) Q4 2024 earnings summary

Executive summary

• Annual recurring revenue (ARR) rose 59% year-over-year to CAD 71.1 million, with 15% organic growth and 40% from acquisitions.

• Q4 revenue reached CAD 20.6 million, up 51% year-over-year, contributing to total annual revenue of CAD 68.6 million, a 31% increase.

• Adjusted EBITDA grew 34% year-over-year to CAD 17.8 million (26% of revenue), with Q4 adjusted EBITDA at CAD 5 million (25% of revenue).

• Four acquisitions in 2024 expanded the ARR base to over CAD 70 million, with integration efforts underway.

• Cash on hand at year-end was CAD 56.6 million, with a subsequent CAD 34.5 million equity raise.

Financial highlights

• Q4 ARR reached CAD 71.1 million, up 33% sequentially from Q3, driven by CAD 2.6 million organic and CAD 14.6 million acquisition growth.

• Recurring revenue was CAD 17.17 million (86% of total), up from CAD 11.3 million (83%) last year.

• Gross margin was 81% in Q4, down from 83% in the prior period.

• Net income before taxes was CAD 0.2 million in Q4, down from CAD 2 million year-over-year, impacted by CAD 2.6 million in acquisition and restructuring costs.

• Deferred revenue at year-end was CAD 35.6 million.

Outlook and guidance

• Management expects the pace of M&A activity from 2024 to continue through 2025.

• Well-capitalized with pro forma cash balance of approximately CAD 90 million, aiming to deploy capital for synergistic acquisitions.

• Conservative organic ARR growth target may be raised, with expectations of CAD 1.1–1.8 million per quarter.

• Q1 typically strong due to government year-ends; pipeline remains robust but no specific guidance provided.

• Focus on operational efficiency and sales productivity tools in 2025, with limited headcount increase.