Protech Home Medical Announces Record 11X Adjusted EBITDA Growth and Significant Operating Cash Flow Growth in Year End Audited Financials

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN.

CINCINNATI, Jan. 28, 2019 (GLOBE NEWSWIRE) -- Protech Home Medical Corp. (the “Company”) (TSXV:PTQ), a healthcare services company with operations in the U.S., today announced its financial results for the year ended September 30, 2018 and operational highlights.

Financial highlights from the year ended September 30, 2018:

• Revenue for the fourth quarter of $20.3 million, representing the largest revenue recorded for any one quarter of the fiscal year ended September 30, 2018.
• Adjusted EBITDA for the year of $12.6 million, compared to $1.0 million for the year ended September 30, 2017, an increase of over 1,100%.
• All-time Company record Adjusted EBITDA margins of $5,201 or 26% for the fourth quarter ended September 30, 2018.
• Adjusted EBITDA margins for the year of 16.3%, compared to 1.4% for the year ended September 30, 2017, an increase of over 1,060%.
• A cash balance of $4.3 million as at the year ended September 30, 2018 an increase of 27% compared to the year ended September 30, 2017.
• Following a market assessment in which management concluded that a consolidation was likely to increase overall investment interest in the Company, the Company completed a 1:5 share consolidation effective December 31, 2018 in which each shareholder received one new post-consolidation common share for every five pre-consolidation common shares held.
• Likewise, the market assessment noted above led management to change the Company’s ticker symbol to “PTQ” as at December 31, 2018, to ensure that there is a full and complete understanding in the market place that our Company is separate and apart from its predecessor.          

Operational highlights from the year ended September 30, 2018:

• Through the Company’s continued use of technology and establishing its national fulfillment center, resupply deliveries increased from 35,578 for the year ended September 30, 2017 to 48,357, an increase of over 36 percent.
• As a result of excellent patient care, the Company achieved 6% organic growth in its patient base for the year compared to the year ended September 30, 2017.
• As a result of our investment in establishing our centralized billing platform, our bad debt expense has been reduced substantially to $5.2 million for the year, compared to $15.9 million in the year ended September 30, 2017.

The annual financial statements of the Company for the fiscal years ended September 30, 2018 and 2017 and accompanying Management's Discussion & Analysis (MD&A) are available at www.sedar.com.

“I am very pleased with our year ended financial results,” said CEO and Chairman Greg Crawford. “Over the course of the one year since our current management team has been in place, we have achieved significantly improved results culminating in an increase in revenue, an astronomical and dramatic increase in Adjusted EBITDA, and perhaps most significantly, a fantastic and steady improvement in our Adjusted EBITDA margins for the last four quarters. We have managed to achieve these results while also building on all aspects of our business including an increase in the number of deliveries, shipments and set-ups. I would like to thank our leadership team along with every single team member who helped us deliver this great result. Finally, we have maintained a relatively conservative balance sheet that has positioned us for continued growth on a go-forward basis. At this time, I would like to thank all of our shareholders that have supported us during this year of transition and express my confidence in our continued financial success with the continued implementation of our revised corporate strategy that incorporates technology, organic growth and strategic acquisitions.”

“In addition to showcasing exemplary operational turnaround, we have made great strides in improving our financial reporting and building a robust balance sheet,” said CFO Hardik Mehta. “I am very pleased to report that unlike recent years, there were no goodwill impairment charges or accounts receivable write-downs this year. Additionally, I think it is important to note that we have dealt with a significant amount of obsolete inventory this year that would have otherwise added to our already impressive reported Adjusted EBITDA. Finally, I am extremely pleased to report that the auditors have removed the non-qualified going concern comment from the Company’s previous years audited financials.”

ABOUT PROTECH HOME MEDICAL CORP.

The Company provides in-home monitoring and disease management services 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 initial service line includes in-home monitoring equipment, supplies and services to patients in the U.S. who take prescription blood thinners, such as Coumadin® (warfarin).

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.

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" and similar expressions as they relate to the Company, including the Company’s continued financial success with the continued implementation of a revised corporate strategy, 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, without limitation: the Company’s ability to maintain/slightly increase its collections ratios; the Company maintaining its gross margins and maintaining its revenue growth; and the Company maintaining its selling, general and administrative expenses. 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 changes to, or application of, current laws and regulations; decline of reimbursement rates; dependence on few payors; possible new drug discoveries; a novel business model; dependence on key suppliers; granting of permits and licenses in a highly regulated business; the overall difficult litigation environment, including in the U.S.; increased competition; changes in foreign currency rates; increased funding costs and market volatility due to market illiquidity and competition for funding; the availability of funds and resources to pursue operations; critical accounting estimates and changes to accounting standards, policies, and methods used by the Company; and the occurrence of natural and unnatural catastrophic events and claims resulting from such events; as well as those risk factors discussed or referred to in the Company’s disclosure documents filed with the securities regulatory authorities in certain provinces of Canada and available at www.sedar.com. Should any factor affect the Company in an unexpected manner, or should assumptions underlying the forward-looking information prove incorrect, the actual results or events may differ materially from the results or events predicted. Any such forward-looking information is expressly qualified in its entirety by this cautionary statement. Moreover, the Company does not assume responsibility for the accuracy or completeness of such forward-looking information. The forward-looking information included in this press release is made as of the date of this press release and the Company undertakes no obligation to publicly update or revise any forward-looking information, other than as required by applicable law.

Non-GAAP Measures

This press release refers to “Adjusted EBITDA” which is a non-GAAP and non-IFRS financial measure that does not have a standardized meaning prescribed by GAAP or IFRS. The Company’s presentation of this financial measure may not be comparable to similarly titled measures used by other companies. This financial measure is intended to provide additional information to investors concerning the Company’s performance. Adjusted EBITDA is defined as EBITDA excluding stock based compensation and gains/losses on financial derivatives. Adjusted EBITDA is a Non-IFRS measure the Company uses as an indicator of financial health, and excludes several items which may be useful in the consideration of the financial condition of the Company, including interest expense, taxes, depreciation, amortization, stock based compensation, good will impairment and gain/losses on financial derivatives. The following table shows our Non-IFRS measure (Adjusted EBITDA) reconciled to our net income for the indicated periods:

Management uses these non-GAAP measures as key metrics in the evaluation of the Company’s performance and the consolidated financial results. The Company believes these non-GAAP measures are useful to investors in their assessment of the operating performance and the valuation of the Company. In addition, these non-GAAP measures address questions the Company routinely receives from analysts and investors and, in order to assure that all investors have access to similar data, the Company has determined that it is appropriate to make this data available to all investors. However, non-GAAP financial measures are not prepared in accordance with GAAP, and the information is not necessarily comparable to other companies and should be considered as a supplement to, not a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP.

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.

For further information please visit our website at www.protechhomemedical.com, or contact:

Hardik Mehta
Chief Financial Officer
Protech Home Medical Corp.
859-300-6455
investorinfo@myphm.com