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Eq., and Other Assets, net (4,611) $ (2,444) $ (4,502) $ (2,558) $ (791) $ (588) $ Acquisition of intangible assets (625) $ $ Cash paid for acquisition, net of cash acquired $ (16,616) $ NET CASH PROVIDED BY INVESTING ACTIVITIES (4,611) $ (19,060) $ (5,127) $ (2,558) $ (791) $ (588) $ FINANCING ACTIVITIES Net Borrowing on term loan, revolver, and capital leases (8,565) $ 7,377 $ (5,369) $ 1,619 $ (4,247) $ (5,517) $ Capitalized debt issuance costs $ (808) $ $ (2,842) $ Common stock withholding on stock based compensation (135) $ (167) $ (102) $ (144) $ (131) $ (78) $ Treasury shares repurchased $ (68) $ (363) $ $ $ $ Principal payments on capital lease obligations (160) $ (822) $ NET CASH PROVIDED BY FINANCING ACTIVITIES (8,860) $ 5,512 $ (5,834) $ (1,367) $ (4,378) $ (5,595) $ Net change in cash and cash equivalents (3,763) $ (2,736) $ (4,215) $ 1,527 $ 665 $ (1,418) $ Cash and cash equivalents, beginning of period 11,513 $ 7,750 $ 5,014 $ 799 $ 799 $ 2,326 $ Cash and cash equivalents, end of period 7,750 $ 5,014 $ 799 $ 2,326 $ 1,464 $ 908 $ Free Cash Flow (EBITDA less CapEx Purchases of ME) 6,588 $ 5,301 $ 5,754 $ 7,032 $ 5,331 $ 9,159 $ Free Cash Flow (Adj.
Impairment Charges) 11,199 $ 7,745 $ 10,256 $ 9,590 $ 6,122 $ 9,747 $ Adjusted EBITDA NA NA 10,256 $ 13,126 $ 10,477 $ 11,271 $ 32 Continued Revenue Diversification 2009 Revenue 70% 26% 1% 1% 2% 33 Continued Revenue Diversification 70% 26% 1% 1% 2% 51% 23% 13% 4% 9% 2009 Revenues $39M 2012 Revenues $59M 34 Summary Balance Sheet ($000's) 12/31/09 12/31/10 12/31/11 12/31/12 3/31/13 6/30/13 9/30/13 ASSETS Current Assets: Cash and cash equivalents 7,750 $ 5,014 $ 799 $ 2,326 $ 472 $ 102 $ 908 $ Account receivable total, net of allowance 5,517 $ 6,679 $ 7,448 $ 8,511 $ 9,570 $ 9,440 $ 9,291 $ Inventory 925 $ 1,699 $ 1,309 $ 1,339 $ 1,378 $ 1,379 $ 1,343 $ Prepaid expenses and other current assets 395 $ 750 $ 934 $ 684 $ 832 $ 713 $ 625 $ Deferred income taxes 125 $ 1,147 $ 682 $ 1,971 $ 1,986 $ 1,986 $ 1,986 $ Total Current Assets 14,712 $ 15,289 $ 11,172 $ 14,831 $ 14,238 $ 13,620 $ 14,153 $ Total PP E and Medical Equipment 13,499 $ 16,672 $ 17,672 $ 16,564 $ 16,653 $ 17,958 $ 18,749 $ Deferred debt issuance costs, net 781 $ 658 $ 421 $ 2,362 $ 2,232 $ 2,106 $ 1,972 $ Total Goodwill and Intangible assets, net 85,491 $ 97,344 $ 28,221 $ 25,541 $ 24,871 $ 24,221 $ 24,075 $ Deferred income taxes 18,187 $ 17,806 $ 17,755 $ 17,689 $ 17,259 $ Other assets 207 $ 401 $ 590 $ 419 $ 477 $ 157 $ 184 $ Total Assets 114,690 $ 130,364 $ 76,263 $ 77,523 $ 76,226 $ 75,751 $ 76,392 $ LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Account payable total 1,306 $ 2,016 $ 4,063 $ 2,144 $ 3,056 $ 3,833 $ 4,329 $ Accrued expenses and other 1,573 $ 4,631 $ 2,235 $ 4,098 $ 4,182 $ 2,782 $ 2,824 $ Derivative liabilities 2,670 $ 183 $ 258 $ $ $ $ Current portion of long term debt 5,501 $ 5,551 $ 6,576 $ 3,953 $ 3,872 $ 3,124 $ 3,239 $ Total Current Liabilities 11,050 $ 12,381 $ 13,132 $ 10,195 $ 11,110 $ 9,739 $ 10,392 $ Long Term Debt, net of current portion 18,640 $ 26,646 $ 22,551 $ 27,315 $ 24,594 $ 25,204 $ 24,380 $ Deferred income taxes 3,314 $ 5,788 $ Other Liabilities 221 $ 406 $ 415 $ $ $ $ $ Total Liabilities 33,225 $ 45,221 $ 36,098 $ 37,510 $ 35,704 $ 34,943 $ 34,772 $ Total Stockholderrs' Equity 81,465 $ 85,143 $ 40,165 $ 40,013 $ 40,522 $ 40,808 $ 41,620 $ Total Liabilities and Equity 114,690 $ 130,364 $ 76,263 $ 77,523 $ 76,226 $ 75,751 $ 76,392 $ Total Debt 24,141 $ 32,197 $ 29,127 $ 31,268 $ 28,466 $ 28,328 $ 27,619 $ 35 Cash Flow ($000's) FY2009 FY2010 FY2011 FY2012 9 Mo 2012 9 Mo 2013 OPERATING ACTIVITIES Net Income 774 $ (1,852) $ (45,443) $ (1,489) $ Adjustments: Provision for doubtful accounts 4,006 $ 4,515 $ 4,099 $ 5,251 $ Depreciation 4,122 $ 5,357 $ 6,386 $ 5,668 $ Loss on disposal of pumps 342 $ 994 $ 1,731 $ 237 $ Amortization of intangible assets 1,827 $ 2,259 $ 2,662 $ 2,734 $ Asset impairment charges 67,592 $ $ Stock based compensation 753 $ 3,860 $ 1,185 $ 964 $ Total Other Adjustments 2,827 $ (1,581) $ (26,021) $ (1,971) $ Changes in assets and liabilities (ex. acquisitions) (4,943) $ (2,740) $ (5,445) $ (5,942) $ NET CASH PROVIDED BY OPERATING ACTIVITIES 9,708 $ 10,812 $ 6,746 $ 5,452 $ 5,834 $ 4,765 $ INVESTING ACTIVITIES Total Purchases of PP E, Med.
Competitive environment will vary in accordance with the level of cuts by CMS CMS Competitive Bidding Target Timetable CMS will institute some form of competitive CMS will institute some form of competitive bidding nationwide by January 2016. bidding nationwide by January 2016. CMS began the pre bidding supplier awareness program CMS announced bidding schedule, start bidder education and begin a bidder registration period Bid window opens Current Round 1 bid contracts expire CMS announces Round 1 Recompete bid results INFU impact $250K annually Bid window closes Implementation of Round 1 bid contracts and prices Spring 2012 08/16/12 10/15/12 12/14/12 10/1/13 12/31/13 01/01/14 31 Summary Income Statement ($000's) FY2009 FY2010 FY2011 FY2012 9 Mo 2012 9 Mo 2013 Net revenues: Rentals 46,795 $ 53,471 $ 38,903 $ 41,556 $ Product sales 7,842 $ 5,357 $ 3,692 $ 3,547 $ Net revenues 38,964 $ 47,229 $ 54,637 $ 58,828 $ 42,595 $ 45,103 $ Cost of revenues: Product, service and supply costs 6,200 $ 7,730 $ 9,128 $ 9,165 $ 6,760 $ 8,174 $ Pump depreciation and loss on disposal 4,127 $ 5,954 $ 10,154 $ 6,752 $ 4,928 $ 4,836 $ Gross profit 35,355 $ 42,911 $ 30,907 $ 32,093 $ Provision for doubtful accounts 4,006 $ 4,515 $ 4,099 $ 5,251 $ 3,119 $ 4,782 $ Amortization of intangibles 1,827 $ 2,259 $ 2,662 $ 2,734 $ 2,028 $ 1,972 $ Asset impairment charges 67,592 $ Selling and marketing 5,258 $ 7,087 $ 9,371 $ 9,864 $ 7,635 $ 7,281 $ General and administrative 12,218 $ 20,622 $ 17,987 $ 23,062 $ 17,688 $ 14,622 $ Operating income (loss) 5,328 $ (938) $ (66,356) $ 2,000 $ 437 $ 3,436 $ Total other (loss) (3,577) $ (2,285) $ (2,221) $ (4,152) $ (2,921) $ (2,307) $ Loss before income taxes 1,751 $ (3,223) $ (68,577) $ (2,152) $ (2,484) $ 1,129 $ Income tax benefit (977) $ 1,371 $ 23,134 $ 663 $ 774 $ (324) $ Net income (loss) 774 $ (1,852) $ (45,443) $ (1,489) $ (1,710) $ 805 $ EBITDA 11,199 $ 7,745 $ (57,336) $ 9,590 $ 6,122 $ 9,747 $ EBITDA (ex.
Transacts directly with healthcare providers no third party reimbursement revenue Infusion pumps Enteral pumps Direct Payor Business Model Service Repair Products InfuSystem sells, rents and finances a wide variety of new and used large volume and ambulatory pumps InfuSystem services and repairs both its own fleet of pumps and many types of other movable medical equipment Syringe pumps Ambulatory pumps Large volume pumps Ambulatory pumps Fluid collection Medical equipment 27 InfuSystem offers new pumps from top brands Broker dealer trading desk In addition, over 70 models and versions of pre owned pumps are offered Pre owned pumps are re built and certified by in house biomedical technicians to be patient ready Warranty offered on pre owned pumps A variety of financing options to fit customers operating, budgeting and financing parameters Nationwide, industry leading ISO 9001 service programs Launching branch service center in Houston Direct Payor Offerings Renting new or pre owned equipment Rent pumps by the day, week or month to match swings in patient count Free shipping on all rentals Industry leader in sales of pre owned equipment, creating significant savings Competitive pricing on new equipment Option to sell back pre owned pumps Leasing plans offered ISO 9001 Service offered Service plans offered Local service expansion 2 existing; 1 planned Coordinate with TPP Loaner pumps available Pre Owned New Pumps from Top Manufacturers Leading Provider of New and Pre Owned Pumps Full Spectrum of Ownership Options for Customers Rental Sales Asset Management 28 Medical Equipment Service Repair In addition to supporting and repairing InfuSystem s in house fleet, the Company certifies, recalibrates, repairs and services a variety of infusion pumps Pumps require scheduled maintenance and calibration in accordance with manufacturer s specifications and regulatory guidelines Service and repair capabilities on high demand services reaching end of life that are no longer supported by manufacturers ISO certification and an established quality system strengthens relationships with major customers Provides InfuSystem an opportunity to establish a business relationship with customers that acquired pumps through other sources Continuing and increased need for compliance with current as well as anticipated regulations 28 highly qualified service technicians 5 major manufacturer relationships: 3 service centers, located in California, Toronto and Kansas 29 Ambulatory Pump Rental Fleet With over 26,000+ pumps in TPP Rental Fleet, InfuSystem maintains the largest fleet of ambulatory infusion pumps in the industry DPP Rental Fleet has over 20,000 pumps The Company has a complete inventory of virtually every model pump from every leading manufacturer, allowing InfuSystem to provide the right pump for any patient s prescribed protocol Purchases of pumps have a high return on investment and an useful life of 10 15 years All Rentals (Both DP and TPP) YE 2011 YE 2012 Q1 2013 Q2 2013 Q3 2013 Rental Revenue ($K) $ 46,795 $ 53,471 $ 13,445 $ 13,618 $ 14,493 Medical Equipment in Service Cost ($K) $ 31,734 $ 34,193 $ 35,026 $ 35,474 $ 37,040 Rental Revenue Per Dollar of Medical Equipment in Service Invested Annualized $ 1.47 $ 1.56 $ 1.54 $ 1.54 $ 1.57 Annual Rental Revenue per $1 Rental Fleet Cost ( Revenue Ratio ) 30 Competitive Bidding Overview InfuSystem was not involved in Round 1 nor Round 2 of Competitive Bidding CMS announced a Recompete of Round 1 competitive bidding on April 17th External infusion pumps/supplies added as a new product category A supplier must bid on all items within the product category to have its RFP considered Recompete covers 9 Metropolitan Statistical Areas (MSAs) Competitive Bidding Overview InfuSystem s Response to Competitive Bidding InfuSystem has engaged consultants and industry professionals to discuss directly with CMS, advise on positioning the Company for potential regulatory changes, and facilitate potential strategic partnership opportunities InfuSystem was awarded contracts in all 9 MSAs with average cuts of ~21% for our category per CMS. 1 of 3 National Vendors to receive contracts in all 9 markets.
IR Contact Info: The Dilenschneider Group 212 922 0900 Rob Swadosh, rswadosh dgi nyc.com Patrick Malone, pmalone dgi nyc.com 22 Appendix: INFU Overview 23 Compelling Value Proposition In House Service Repairs Convenience Flexibility Pre Owned Equipment Expertise One Stop Shopping Solution Convenience and flexibility of rentals and financing minimize customer capital outlays Rental and financing eliminates the need for in house maintenance/service Option to own, rent or finance designed to fit customers operating and financial parameters Shorter and longer term financing options One stop shopping solution for ambulatory large volume pump and other movable medical devices Sales Rentals Supplies Service Financing World class biomedical repair and service for pumps, defibrillators and most other general medical equipment Allows InfuSystem to purchase, clean, repair and certify any used medical equipment the Company buys for subsequent sale, rental or financing to customers ONE STOP SHOP SERVICE REPAIRS CONVENIENCE FLEXIBILITY PRE OWNED EQUIPMENT EXPERTISE Unique ability to source and deploy pre owned movable medical equipment Consistent, fair and knowledgeable market maker for pre owned pump disposals Market knowledge results in attractive equipment acquisition costs Complementary core competencies allow InfuSystem to offer superior selection, flexibility, pricing and services 24 Payor Customer Mix Leading Cancer Institution Customers Revenue by Payor (FY2012) High diversification of providers and payors No single healthcare provider represents more than 7% of Third Party Payor revenues Strong payor mix among Medicare, other commercial insurers, Blue Cross/Blue Shield, and Medicaid Less than 5% of revenues received directly from patients through co pays or otherwise Broad coverage further diversifies revenue streams InfuSystem has strong relationships with the largest third party payors and the leading cancer institutions 9 of 10 of the Top Ten Cancer Treatment Centers Medicare and Medicaid 37% BCBS 19% Patient 6% Commercial 38% CMS: Centers for Medicare and Medicaid Services 25 Competitive Landscape InfuSystem measures its market share not in terms of the number of practices, but the pool of addressable patients The breakdown of the Company s current market share shows that despite being the predominant national player in continuous infusion, there is ample room for organic growth The Company competes for market share in all but the Captive Health Plans which represent health plans in which all services are rendered by one common payor/provider (e.g., Kaiser Permanente) Market Share for Oncology Continuous Infusion Source: American Cancer Society, CMS, National Comprehensive Cancer Network, National Home Infusion Association InfuSystem 32% Home Infusion Providers 32% Facility Owned Pumps 11% Competitor DME Providers 10% Disposable Pumps 1% Captive Health Plan 14% 26 InfuSystem s Direct Payor business is focused primarily on the sale, rental, financing and accompanying service of movable medical equipment to hospitals and alternate care sites who pay InfuSystem directly no third party reimbursement Founded in 1998 and headquartered in Olathe, KS with distribution/service centers in Santa Fe Springs, CA and Mississauga, Ontario InfuSystem services ISO 9001 and repairs movable medical equipment Leading provider to alternate site healthcare facilities and hospitals in the United States and Canada Home infusion providers, long term care, physician clinics, research facilities, etc.
Aging Population and Cancer Growth More Patients Home IV , Commercial Pay Recognizing Value, CMS Competitive Bidding Peripheral Nerve Block and Smart Pump Growth Revenue Growth in High Single Digits Through 2015 16 Financial Review 17 Financial Overview (1) Free Cash Flow = Adjusted EBITDA less CapEx and Purchases of Medical Equipment $38,964 $47,229 $54,637 $58,828 $56,793 $60,137 $30m $40m $50m $60m $70m FY2009 FY2010 FY2011 FY2012 9M 2012 Annualized 9M 2013 Annualized Revenues Growing $10,256 $13,126 $13,969 $15,028 $6m $10m $14m $18m FY2011 FY2012 9M 2012 Annualized 9M 2013 Annualized AEBITDA Growing $5,754 $10,568 $12,915 $14,244 $4m $8m $12m $16m FY2011 FY2012 9M 2012 Annualized 9M 2013 Annualized FCF Growing $2,931 $2,226 ` $2,935 $7,211 $6,249 $5,537 $5,955 $0m $2m $4m $6m $8m 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 3Q 2013 Liquidity Improved Revenues Adjusted EBITDA Free Cash Flow (1) Unrestricted Liquidity 18 19 Uses of Free Cash Flow (1) Free Cash Flow = Adjusted EBITDA less CapEx and Purchases of Medical Equipment $24,141 $32,197 $29,127 $31,268 $28,466 $28,328 $27,619 $20m $25m $30m $35m FY2009 FY2010 FY2011 FY2012 1Q 2013 2Q 2013 3Q 2013 Debt Declining $31,734 $34,193 $35,026 $35,474 $37,040 $30m $32m $34m $36m $38m FY2011 FY2012 Q1 2013 Q2 2013 Q3 2013 Rental Fleet Increasing Total Debt PP E and Medical Equipment in Service (at cost) Every $1.00 invested in the rental fleet returns ~$1.50 in revenue every year for the life of the pump Take Away 20 Positioned For Growth Market Trends InfuSystem is uniquely positioned to take advantage of market trends Leadership Leadership can now focus on running a business for first time in over a year Strategy Transformational strategy is developed and being implemented 21 Thank You for Your Interest!
Ties customer to InfuSystem. 14 For Faster Turnaround and Improved Utilization Kansas City Service Center Madison Heights Service Center Future New Jersey Service Center Future Atlanta Service Center Los Angeles Area Service Center Houston Service Center Toronto Canada Service Center InfuSystem Distribution High density Metro Markets Reduced cost of air shipments Improved utilization of pumps Increased market share of same day rental market 15 Where Does This Get INFU In Three Years ?
Annual Pump Recertification Preventative Maintenance Warranty Repair World Class ISO Certified service facilities Regional Distribution West, South, East Canada 28 Certified Technicians 10 Oncology Acute Care Emergency Services Long Term Care Provider Home Infusion Offering Infusion to All Points of Care 11 Continued Revenue Diversification 2009 Revenues $39M 2012 Revenues $59M 12 Connectivity through EMR , Web Portal and System Interface 13 Connectivity through EMR , Web Portal and System Interface Electronic Data Exchange Interface Effects Customer investment in interface makes for sticky relationships.
Those factors, risks and uncertainties include, but are not limited to, potential changes in overall healthcare reimbursement including CMS competitive bidding, sequestration, concentration of customers, increased focus on early detection of cancer, competitive treatments, dependency on Medicare Supplier Number, availability of chemotherapy drugs, global financial conditions, changes and enforcement of state and federal laws, natural forces, competition, dependency on suppliers, risks in acquisitions joint ventures, US Healthcare Reform, relationships with healthcare professionals and organizations, technological changes related to infusion therapy, dependency on websites and intellectual property, the ability of the Company to successfully integrate acquired businesses, dependency on key personnel, dependency on banking relations and covenants, and other risks associated with our common stock, as well as any other litigation to which the Company may be subject from time to time; and other risk factors as discussed in the Company s annual report on Form 10 K for the year ended December 31, 2012 and in other filings made by the Company from time to time with the Securities and Exchange Commission. 2 Innovative provider and supplier of infusion services Market leader in oncology home infusion with 40,000 patients a year 25 Year business model World class pump rentals and service to providers, manufacturers, and other rental companies in the US and Canada 46,000 InfuSystem pump fleet generating revenue from both payors and providers InfuSystem at a Glance 2013 9 Month Financials Revenues $45.1M (Up 6%) AEBITDA $11.5M (Up 8%) Free Cash Flow $9.2M (Up 73%) Market Cap $37.65M $1.72 Company Overview 3 Device Pharma Manufacturer, Distributor, GPO, ACO Full Line Multi Therapy Multi Point Offering Partners Provider Patient Payor 4 Positioned For Growth InfuSystem is uniquely positioned to take advantage of market trends Leadership can now focus on running a business for first time in over a year Transformational strategy is developed and being implemented Strategy Leadership Market Trends 5 InfuSystem Niche Extension of Clinic to Home Ambulatory Home Infusion 25 year old business model in DME billing At home, at work, at play, all while receiving the drug High satisfaction scores 24/7 on call oncology nurses Proven outcomes with continuous home infusion Oncology, Post Surgical Pain, Special Disease States TPP Payor Contracts Bills patient insurance 250+ Commercial and Government Payor Contracts Commercial Payors reimburse more therapies than CMS Awarded contracts in all 9 MSAs (1 of 3 National Vendors) Average cuts of ~21% for our category, per CMS ($250,000 per yr) 6 US Population Growing Aging Population Stats At risk lifestyles persist (red, processed meats) Growth in all types of cancers Cancer 1,650,000 new cancer cases in 2013 Can be treated effectively by continuous infusion Colo rectal 3 rd most common in US and Worldwide 9% of all new cases 145,000 new cases per year 7 8 TPP Pump Return on Investment Average Cost ~$1,500/pump Pump Lifespan 15 years Average Monthly Revenue ~$300/pump Lifetime Revenue/Pump Approx. ~$20,000+ Increasing Therapy Offerings to Payors Special Disease States Surgery Infectious Disease Oncology Payor 9 Rentals, Sales Service to Providers Pump Rentals, Sales and Asset Management Pump Experts Direct sales, rental, and lease of device and supplies in US and Canada Pump Broker Expertise ability to acquire and dispose of CAP EX in cost effective way Asset management, rental and lease Preventative Maint.
InfuSystem s outlook for 2013 and other forward looking statements in this release are made as of December 5, 2013, and the Company disclaims any duty to supplement, update or revise such statements on a going forward basis, whether as a result of subsequent developments, changed expectations or otherwise. In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the Company is identifying certain factors that could cause actual results to differ, perhaps materially, from those indicated by these forward looking statements.
InfuSystem Holdings, Inc. LD MicroCap Event December 5, 2013 Eric K. Steen, CEO Jonathan P. Foster, CFO Exhibit 99.1 1 Safe Harbor Statement Certain statements contained in this release are forward looking statements and are based on future expectations, plans and prospects for InfuSystem Holdings, Inc. s ( InfuSystem , INFU , the Company , We ) business and operations that involve a number of risks and uncertainties.
EBITDA less CapEx Purchases of ME) 5,754 $ 10,568 $ 9,686 $ 10,683 $ Revenue Growth (%) 21.2 % 15.7 % 7.7 % 5.9 % 36