Full Press Release Details
Quipt Enters Louisiana Adding Approximately
$6.5 Million in Annualized Revenues, and Anticipated $1.3 Million of Adjusted EBITDA (post integration) with Acquisition of Access Respiratory
Expands Referring Physician Network to Over
20,600 and Active Patient Base to Over 190,000
Cincinnati, Ohio - June 21, 2022 -
Quipt Home Medical Corp. ("Quipt" or the "Company") (NASDAQ:QIPT; TSXV:QIPT), a U.S. based leader
in the home medical equipment industry, focused on end-to-end respiratory care, is very pleased to announce that it has acquired Access
Respiratory Homecare, LLC ("Access Respiratory Homecare"), a business with operations in Louisiana, reporting unaudited
trailing 12-month annual revenues of approximately $6.5 million and with anticipated Adjusted EBITDA (defined below) of $1.3 million
post integration. As a reminder all figures stated are in USD.
The acquisition encompasses two locations in Louisiana,
representing the 19th state of service for Quipt. The Company will immediately gain access to the large market of New Orleans,
covering the entire coverage sphere of that attractive metro hub. The Company also gains access to the city of Lafayette, as well as the
surrounding areas, providing a second hub for Quipt to grow its infrastructure in the state. The acquisition adds over 1,000 referring
physicians bringing Quipt's referring network base to over 20,600, and increases Quipt's active patient count by over 6,000,
bringing Quipt's total to over 190,000 active patients.
Additionally, Access Respiratory Homecare has
a strong management team in place focused on clinical excellence, and like Quipt, offers high-quality service, equipment, and supplies.
Access Respiratory Homecare has several difficult to obtain insurance contracts and the expansionary operating footprint aligns closely
with regions that have a high prevalence of Chronic Obstructive Pulmonary Disease ("COPD"), a key target patient group;
Louisiana is among the highest prevalence U.S. States. According to the National Institutes of Health (NIH), about 304,000 people in Louisiana
have COPD1. The acquisition possesses a heavily weighted
respiratory product mix inclusive of a robust ventilation therapy program, which contain pediatric patients on the therapy.
The integration process will allow for Quipt's
best-in-class subscription-based resupply program to be firmly cemented, with over 2,400 patients set to join the resupply program, an
immediate revenue synergy.
The acquisition will increase Quipt's annual
revenues by approximately $6.5 million and is expected to increase Quipt's Adjusted EBITDA, post integration, by $1.3 million.
Reiteration of Outlook for Calendar End
2022 (Fiscal Q1 2023)
Based on the current operations, market trends
and completed and prospective acquisitions, the Company is reiterating it outlook for its annual run-rate revenue by the end of calendar
2022 (Fiscal Q1 2023) to be $180-$190 million with $38-$43 million in run-rate Adjusted EBITDA.
Management Commentary
"We are extremely excited to close the acquisition
of Access Respiratory Homecare, providing us a meaningful entrance into Louisiana, representing our 19th state of service.
Louisiana is an attractive market that we have been looking to enter with over 300,000 COPD sufferers across the state, and we are thrilled
to be able to do so on the heels of this acquisition," said Greg Crawford, Chairman and CEO of Quipt. "Our resupply program
is an immediate actionable revenue synergy for us, with over 2,400 patients set to join our program as we fully integrate the acquisition.
Moreover, the valuable commercial insurance contracts, strong referring physician base, and opportunity for a land and expand approach
in the state make this a fantastic acquisition for us. Looking ahead our pipeline remains very strong with additional attractive opportunities
like Access for us to strategically expand our footprint into new and existing markets in need of robust clinical respiratory care in
Chief Financial Officer, Hardik Mehta added, "This
acquisition allows us to build out our operating footprint into a brand-new state with significant infrastructure as we surpass 190,000
active patients, 20,600 referring physicians, add $6.5 million in revenue, and a significant adjusted EBITDA contribution. Access is a
perfect example of the quality acquisition targets we are after that meet our stringent criteria and robust due-diligence process. We
will not waver as it comes to our acquisition approach, concentrated on attractive targets that strategically fit our objectives towards
becoming a leader in at home respiratory care across the United States focused on superior patient care."
ABOUT QUIPT HOME MEDICAL CORP.
The Company provides in-home monitoring and disease
management services including end-to-end respiratory solutions for patients in the United States healthcare market. It seeks to continue
to expand its offerings to include the management of several chronic disease states focusing on patients with heart or pulmonary disease,
sleep disorders, reduced mobility, and other chronic health conditions. The primary business objective of the Company is to create shareholder
value by offering a broader range of services to patients in need of in-home monitoring and chronic disease management. The Company's
organic growth strategy is to increase annual revenue per patient by offering multiple services to the same patient, consolidating the
patient's services, and making life easier for the patient.
Readers are cautioned that the financial information
regarding the acquisition disclosed herein is unaudited and derived as a result of the Company's due diligence, including a review
of the acquisition's bank statements and tax returns.
There can be no assurance that any of the
potential acquisitions in the Company's pipeline or in negotiations will be completed as proposed or at all and no definitive agreements
have been executed. Completion of any transaction will be subject to applicable director, shareholder, and regulatory approvals.
Unless otherwise specified, all dollar
amounts in this press release are expressed in U.S. dollars.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy
or accuracy of this release.
Forward-Looking Statements
Certain statements contained in this
press release constitute "forward-looking information" as such term is defined in applicable Canadian
securities legislation. The words "may", "would", "could", "should", "potential",
"will", "seek", "intend", "plan", "anticipate",
"believe", "estimate", "expect", "outlook", and similar expressions as they
relate to the Company, including: post integration financial results (revenue and Adjusted EBITDA) of Access Respiratory
Homecare; Quipt adding patients to its subscription-based resupply program; Quipt's acquisition pipeline and pace of
further acquisitions; and Quipt's outlook for calendar 2022; are intended to identify forward-looking information. All
statements other than statements of historical fact may be forward-looking information. Such statements reflect the
Company's current views and intentions with respect to future events, and current information available to the
Company, and are subject to certain risks, uncertainties and assumptions, including: the acquisition achieving
results at least as good as historical performances; the financial information regarding the acquisition being
verified when included in the Company's consolidated financial statements prepared in accordance with
generally accepted accounting principles in Canada as set out in the CPA Canada Handbook - Accounting
under Part I, which incorporates International Financial Reporting Standards as issued by the International
Accounting Standards Board ; the Company successfully identified, negotiating and completing additional
acquisitions, including accretive acquisitions; and in order to meet calendar 2022 outlook, the Company organically
growing at an annualized rate of 10%, completing acquisitions that add at least $18 to $28 million in new
revenue and contributing Adjusted EBITDA post integration of at least $4 to $6 million. Many factors could cause the actual
results, performance or achievements that may be expressed or implied by such forward-looking information to
vary from those described herein should one or more of these risks or uncertainties materialize. Examples of such
risk factors include, without limitation: credit; market (including equity, commodity, foreign exchange and interest
rate); liquidity; operational (including technology and infrastructure); reputational; insurance; strategic;
regulatory; legal; environmental; capital adequacy; the general business and economic conditions in the regions
in which the Company operates; the ability of the Company to execute on key priorities, including the successful
completion of acquisitions, business retention, and strategic plans and to attract, develop and retain key
executives; difficulty integrating newly acquired businesses; the ability to implement business strategies and
pursue business opportunities; low profit market segments; disruptions in or attacks (including cyber-attacks) on
the Company's information technology, internet, network access or other voice or data communications systems or
services; the evolution of various types of fraud or other criminal behavior to which the Company is exposed; the
failure of third parties to comply with their obligations to the Company or its affiliates; the impact of new and