CORVEL CORP [CRVL] Filings

10-Q 1 crvl-20220930.htm 10-Q 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to x

Commission file number 0-19291

CORVEL CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Delaware

33-0282651

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)


5128 Apache Plume Road, Suite 400
Fort Worth, TX		76109
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (817) 390-1416

Not Applicable

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common Stock, Par Value $0.0001 Per Share

CRVL

The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☑	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The number of shares outstanding of the registrant's Common Stock, $0.0001 par value per share, as of November 1, 2022, was 17,265,239.

CORVEL CORPORATION

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS


		Page

PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements	3

	Consolidated Balance Sheets – September 30, 2022 (unaudited) and March 31, 2022	3
	Consolidated Income Statements (unaudited) – Three months ended September 30, 2022 and 2021	4
	Consolidated Income Statements (unaudited) – Six months ended September 30, 2022 and 2021	5
	Consolidated Statements of Stockholders’ Equity (unaudited) – Three and six months ended September 30, 2022 and 2021	6
	Consolidated Statements of Cash Flows (unaudited) – Six months ended September 30, 2022 and 2021	7
	Notes to Consolidated Financial Statements (unaudited) – September 30, 2022	8

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	17

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24

Item 4.	Controls and Procedures	24

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	25

Item 1A.	Risk Factors	25

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32

Item 3.	Defaults Upon Senior Securities	33

Item 4.	Mine Safety Disclosures	33

Item 5.	Other Information	33

Item 6.	Exhibits	34

	Signatures	35

Page 2

PART I – FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

CORVEL CORPORATION

Consolidated Balance Sheets


	September 30, 2022			March 31, 2022
	(Unaudited)
Assets
Current Assets
Cash and cash equivalents	$	75,625,000		$	97,504,000
Customer deposits		75,770,000			69,781,000
Accounts receivable, net		84,787,000			82,586,000
Prepaid taxes and expenses		12,201,000			15,123,000
Total current assets		248,383,000			264,994,000
Property and equipment, net		82,506,000			76,268,000
Goodwill		36,814,000			36,814,000
Other intangibles, net		1,456,000			1,669,000
Right-of-use asset, net		29,930,000			35,020,000
Other assets		797,000			481,000
TOTAL ASSETS	$	399,886,000		$	415,246,000
Liabilities and Stockholders' Equity
Current Liabilities
Accounts and taxes payable	$	17,028,000		$	14,431,000
Accrued liabilities		158,482,000			156,939,000
Total current liabilities		175,510,000			171,370,000
Deferred income taxes, net		1,107,000			1,689,000
Long-term lease liabilities		25,436,000			29,792,000
Total liabilities		202,053,000			202,851,000
Commitments and contingencies
Stockholders' Equity
Common stock, $.0001 par value: 120,000,000 shares authorized at September 30, 2022 and March 31, 2022; 54,873,202 shares issued (17,314,186 shares outstanding, net of Treasury shares) and 54,788,712 shares issued (17,569,087 shares outstanding, net of Treasury shares) at September 30, 2022 and March 31, 2022, respectively		3,000			3,000
Paid-in capital		207,986,000			201,609,000
Treasury stock (37,559,016 shares at September 30, 2022 and 37,219,625 shares at March 31, 2022)		(706,806,000	)		(654,520,000	)
Retained earnings		696,650,000			665,303,000
Total stockholders' equity		197,833,000			212,395,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	399,886,000		$	415,246,000

See accompanying notes to unaudited consolidated financial statements.

Page 3

CORVEL CORPORATION

Consolidated Income Statements – (Unaudited)


	Three Months Ended September 30,
	2022		2021
REVENUES	$	177,426,000	$	157,743,000
Cost of revenues		141,332,000		121,082,000
Gross profit		36,094,000		36,661,000
General and administrative expenses		17,549,000		16,658,000
Income before income tax provision		18,545,000		20,003,000
Income tax provision		3,889,000		3,931,000
NET INCOME	$	14,656,000	$	16,072,000
Net income per common and common equivalent share
Basic	$	0.84	$	0.90
Diluted	$	0.83	$	0.88
Weighted average common and common equivalent shares
Basic		17,386,000		17,841,000
Diluted		17,650,000		18,232,000

See accompanying notes to unaudited consolidated financial statements.

Page 4

CORVEL CORPORATION

Consolidated Income Statements – (Unaudited)


	Six Months Ended September 30,
	2022		2021
REVENUES	$	353,733,000	$	310,363,000
Cost of revenues		277,770,000		236,489,000
Gross profit		75,963,000		73,874,000
General and administrative expenses		36,219,000		33,303,000
Income before income tax provision		39,744,000		40,571,000
Income tax provision		8,397,000		7,656,000
NET INCOME	$	31,347,000	$	32,915,000
Net income per common and common equivalent share
Basic	$	1.80	$	1.84
Diluted	$	1.77	$	1.81
Weighted average common and common equivalent shares
Basic		17,446,000		17,869,000
Diluted		17,726,000		18,226,000

See accompanying notes to unaudited consolidated financial statements.

Page 5

CORVEL CORPORATION

Consolidated Statements of Stockholders’ Equity – (Unaudited)


	Three Months Ended September 30, 2022
	Common Shares		Stock Amount		Paid-in- Capital		Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – June 30, 2022		54,832,358	$	3,000	$	204,839,000		(37,394,507	)	$	(681,208,000	)	$	681,994,000	$	205,628,000
Stock issued under employee stock purchase plan		2,636		—		346,000		—			—			—		346,000
Stock issued under stock option plan, net of shares repurchased		38,208		—		1,851,000		—			—			—		1,851,000
Stock-based compensation expense		—		—		950,000		—			—			—		950,000
Purchase of treasury stock		—		—		—		(164,509	)		(25,598,000	)		—		(25,598,000	)
Net income		—		—		—		—			—			14,656,000		14,656,000
Balance – September 30, 2022		54,873,202	$	3,000	$	207,986,000		(37,559,016	)	$	(706,806,000	)	$	696,650,000	$	197,833,000

	Three Months Ended September 30, 2021
	Common Shares		Stock Amount		Paid-in- Capital		Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – June 30, 2021		54,642,752	$	3,000	$	192,431,000		(36,772,445	)	$	(578,631,000	)	$	615,736,000	$	229,539,000
Stock issued under employee stock purchase plan		1,534		—		271,000		—			—			—		271,000
Stock issued under stock option plan, net of shares repurchased		57,190		—		2,117,000		—			—			—		2,117,000
Stock-based compensation expense		—		—		1,355,000		—			—			—		1,355,000
Purchase of treasury stock		—		—		—		(165,455	)		(25,559,000	)		—		(25,559,000	)
Net income		—		—		—		—			—			16,072,000		16,072,000
Balance – September 30, 2021		54,701,476	$	3,000	$	196,174,000		(36,937,900	)	$	(604,190,000	)	$	631,808,000	$	223,795,000


	Six Months Ended September 30, 2022
	Common Shares		Stock Amount		Paid-in- Capital		Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – March 31, 2022		54,788,712	$	3,000	$	201,609,000		(37,219,625	)	$	(654,520,000	)	$	665,303,000	$	212,395,000
Stock issued under employee stock purchase plan		2,636		—		346,000		—			—			—		346,000
Stock issued under stock option plan, net of shares repurchased		81,854		—		3,702,000		—			—			—		3,702,000
Stock-based compensation expense		—		—		2,329,000		—			—			—		2,329,000
Purchase of treasury stock		—		—		—		(339,391	)		(52,286,000	)		—		(52,286,000	)
Net income		—		—		—		—			—			31,347,000		31,347,000
Balance – September 30, 2022		54,873,202	$	3,000	$	207,986,000		(37,559,016	)	$	(706,806,000	)	$	696,650,000	$	197,833,000

	Six Months Ended September 30, 2021
	Common Shares		Stock Amount		Paid-in- Capital		Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – March 31, 2021		54,529,642	$	3,000	$	185,941,000		(36,653,552	)	$	(564,435,000	)	$	598,893,000	$	220,402,000
Stock issued under employee stock purchase plan		1,534		—		271,000		—			—			—		271,000
Stock issued under stock option plan, net of shares repurchased		170,300		—		7,261,000		—			—			—		7,261,000
Stock-based compensation expense		—		—		2,701,000		—			—			—		2,701,000
Purchase of treasury stock		—		—		—		(284,348	)		(39,755,000	)		—		(39,755,000	)
Net income		—		—		—		—			—			32,915,000		32,915,000
Balance – September 30, 2021		54,701,476	$	3,000	$	196,174,000		(36,937,900	)	$	(604,190,000	)	$	631,808,000	$	223,795,000

See accompanying notes to unaudited consolidated financial statements.

Page 6

CORVEL CORPORATION

Consolidated Statements of Cash Flows – (Unaudited)


	Six Months Ended September 30,
	2022			2021
Cash Flows from Operating Activities
NET INCOME	$	31,347,000		$	32,915,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		12,645,000			11,845,000
Gain on write down or disposal of property, capitalized software or investment		—			(11,000	)
Stock compensation expense		2,329,000			2,701,000
Provision for doubtful accounts		1,239,000			129,000
Deferred income tax		(582,000	)		(675,000	)
Changes in operating assets and liabilities
Accounts receivable		(3,440,000	)		(4,846,000	)
Customer deposits		(5,989,000	)		(4,563,000	)
Prepaid taxes and expenses		2,922,000			(2,464,000	)
Other assets		(317,000	)		(292,000	)
Accounts and taxes payable		(2,676,000	)		450,000
Accrued liabilities		1,543,000			302,000
Operating lease liabilities		734,000			(292,000	)
Net cash provided by operating activities		39,755,000			35,199,000
Cash Flows from Investing Activities
Purchase of property and equipment		(13,396,000	)		(11,617,000	)
Net cash used in investing activities		(13,396,000	)		(11,617,000	)
Cash Flows from Financing Activities
Purchase of treasury stock		(52,286,000

CORVEL CORP [CRVL] Filings
10-Q	[2022-11-03]
10-Q	[2022-08-04]
10-K	[2022-05-27]
10-Q	[2022-02-03]
10-Q	[2021-11-04]
10-Q	[2021-08-05]
10-K	[2021-05-28]
10-Q	[2021-02-04]
10-Q	[2020-11-05]
10-Q	[2020-08-06]
10-K	[2020-06-10]
10-Q	[2020-02-07]
10-Q	[2019-11-07]
10-Q	[2019-08-05]
10-K	[2019-06-07]
10-Q	[2019-02-07]
10-Q	[2018-11-02]
10-Q	[2018-08-03]
10-K	[2018-06-08]
10-Q	[2018-02-02]
10-Q	[2017-11-14]
10-Q	[2017-08-04]
10-K	[2017-06-09]
10-Q	[2017-02-03]
10-Q	[2016-11-04]
10-Q	[2016-08-04]
10-K	[2016-06-10]
10-Q	[2016-02-04]
10-Q	[2015-11-05]
10-Q	[2015-08-06]
10-K	[2015-06-11]
10-Q	[2015-02-05]
10-Q	[2014-11-04]
10-Q	[2014-08-05]
10-K	[2014-06-12]
10-Q	[2014-02-07]
10-Q	[2013-11-08]
10-Q	[2013-08-05]
10-K	[2013-06-10]
10-Q	[2013-02-08]
10-Q	[2012-11-07]
10-Q	[2012-08-07]
10-K	[2012-06-08]
10-Q	[2012-02-06]