Cano Health, Inc.

Third-quarter 2023 revenue was approximately $788 million, up from approximately $665 million in Q3 2022. Total membership increased 6% year-over-year to approximately 312,000 members. Medical cost ratio was 91.8% versus 78.0% a year ago; excluding ACO REACH, MCR was about 89.7% versus about 72.0%. SG&A was approximately $81 million, down about $31 million year-over-year, and adjusted EBITDA was negative $66 million versus positive $18 million last year. Net loss was approximately $492 million versus $112 million, including a $354 million non-cash goodwill impairment. The company ended Q3 with approximately $27 million in unrestricted cash, reported $33 million of net cash proceeds from the Texas and Nevada sale, and said current liquidity as of November 9 was approximately $53 million. Management did not provide full-year 2023 guidance, saying it is not giving guidance while it evaluates strategic alternatives and divestitures; it said Q4 should improve due to medical cost recoveries, lower utilization, seasonality, and restructuring benefits. It reiterated a target of over $100 million in annualized third-party medical cost reductions by the end of 2024 and about $65 million of annualized workforce-related cost reductions through the end of 2024.

Mark Kent framed the quarter as a turning point in simplification and cost reset, saying the company has made major operating-structure changes to operate more efficiently and unlock embedded value. He emphasized the shift to Medicare Advantage in Florida and ACO REACH, the exit from several non-core markets, and a focus on care management changes intended to lower medical costs and improve outcomes. His tone was confident and restructuring-focused, but he also highlighted the need for asset sales and other steps to improve liquidity and strengthen the balance sheet.

Eladio Gil walked through the quarter’s key financial metrics: revenue of about $788 million, membership of roughly 312,000, MCR of 91.8%, SG&A of about $81 million, net loss of $492 million, and adjusted EBITDA of negative $66 million. He attributed the larger loss mainly to a $354 million goodwill impairment and higher medical costs, and noted cash used in operating activities of about $40 million. He also said the company had about $27 million in unrestricted cash at quarter-end, about $53 million in liquidity as of November 9, and does not expect current liquidity to cover operating, investing, and financing needs over the next 12 months.

Analyst questions focused on whether outpatient utilization was worsening, how the $100 million medical-cost savings target should ramp, and whether MSP Recovery shares received in a settlement could be sold for liquidity. Management said outpatient utilization had been stable all year, the $100 million savings would ramp over the rest of the year and the next 12 months, and the MSP Recovery shares are still held but are not registered, which limits saleability. The exchange reinforced the company’s emphasis on cost actions and the limited near-term liquidity flexibility.