CINCINNATI, May 15, 2024 (GLOBE NEWSWIRE) -- Quipt Home Medical Corp. (the “Company”) (NASDAQ: QIPT; TSX: QIPT), a U.S.-based home medical equipment provider, focused on end-to-end respiratory care, today announced its second quarter fiscal 2024 financial results and operational highlights. These results pertain to the three and six months ended March 31, 2024, and are reported in United States dollars ("$", "dollars" and "US$") and have been rounded to the nearest hundred thousand.
Quipt will host its Earnings Conference Call on Thursday, May 16, 2024, at 10:00 a.m. (ET). The dial-in number is 1 (844) 763 8274 or 1 (647) 484 8814. The live audio webcast can be found on the investor section of the Company’s website through the following link: www.quipthomemedical.com.
Financial Highlights:
Operational Highlights:
Subsequent Highlights:
Management Commentary:
“We are very proud of the resilience of our business and our ability to maintain our strong margin profile amid certain industry-related challenges experienced during fiscal Q2. We have observed several positive trends with respect to equipment set-ups, including within our sleep segment, and we have seen no change in favorable referral patterns. To facilitate a return to our historical revenue growth trajectory, we are working diligently to enhance our ongoing organic growth initiatives, such as expanding into continuum markets, and cross selling our end-to-end respiratory solution, which provides a unique go to market approach. Our objective remains to return to an 8-10% annualized organic growth rate, which we believe can be attained with the incorporation of our updated and enhanced capital allocation strategy. As part of this capital allocation approach, subsequent to quarter end, we initiated a share repurchase program through an NCIB for up to 10% of our public float. We firmly believe our current valuation in the marketplace does not properly reflect the underlying fundamentals of the business and our future growth, and we will consider using this tool to enhance shareholder value as appropriate,” said CEO and Chairman Gregory Crawford.
“Our continued financial and operational performance is a result of our ongoing commitment to cost discipline and prudent capital allocation, exemplified by strong and consistent Adjusted EBITDA margin over the years and Adjusted EBITDA margin of 23.3% for the fiscal Q2 period,” said Hardik Mehta, Quipt’s Chief Financial Officer. “Our strong balance sheet, with $32.9 million in liquidity, which includes the impact from the Change Healthcare cyber-attack, positions us exceptionally well to navigate through an environment of higher interest rates, and to strategically deploy capital to increase shareholder value. Moreover, we have full confidence in our margin profile throughout the remainder of the fiscal year, pursue both organic and synergistic inorganic growth opportunities that may arise. Our operations are structured to allow us to effectively drive our strategy for expansion, and we are very confident in our business model and in our continued future growth.”
The Company's full financial statements and related management's discussion and analysis for the three and six months ended March 31, 2024 is available under the Company's profile on SEDAR+ (www.sedarplus.com) and posted on the Company's web site at https://quipthomemedical.com/financials.
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.
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: the Company anticipating solid and robust organic growth, with the goal of achieving 8-10% revenue growth on an annualized basis; the Company expecting cash collections to normalize in the coming months; and the Company being confident in its margin profile throughout the remainder of the fiscal year; 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 Company successfully identified, negotiating and completing additional acquisitions; and operating and other financial metrics maintaining their current trajectories. 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: risks related to credit, market (including equity, commodity, foreign exchange and interest rate), liquidity, operational (including technology and infrastructure), reputational, insurance, strategic, regulatory, legal, environmental, and 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; legal proceedings and litigation, including as it relates to the civil investigative demand (“CID”) received from the Department of Justice and related subpoena from the U.S. Securities and Exchange Commission; 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; the occurrence of natural and unnatural catastrophic events and claims resulting from such events; and risks related to COVID-19 including various recommendations, orders and measures of governmental authorities to try to limit the pandemic, including travel restrictions, border closures, non-essential business closures, quarantines, self-isolations, shelters-in-place and social distancing, disruptions to markets, economic activity, financing, supply chains and sales channels, and a deterioration of general economic conditions including a possible national or global recession; as well as those risk factors discussed or referred to in the Company’s disclosure documents filed with United States Securities and Exchange Commission and available at www.sec.gov, and 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-IFRS Measures
This press release refers to “Recurring Revenue”, “Adjusted EBITDA” and “Leverage Ratio”, which are non-IFRS financial measures that do not have standardized meanings prescribed by IFRS. The Company’s presentation of these financial measures may not be comparable to similarly titled measures used by other companies. These financial measures are intended to provide additional information to investors concerning the Company’s performance.
Recurring Revenue for Q2 is calculated as rentals of medical equipment of $27.4 million plus sales of respiratory resupplies of $23.5 million for a total of $50.9 million, divided by total revenues of $64.0 million, or 79.6%.
Adjusted EBITDA is calculated as net income (loss), and adding back depreciation and amortization, interest expense, net, provision for income taxes, stock-based compensation, professional fees related to civil investigative demand, acquisition-related costs, share of loss of equity method investment, and loss (gain) on foreign currency transactions. The following table shows our non-IFRS measure, Adjusted EBITDA, reconciled to our net income (loss) for the following indicated periods (in $millions):
| Three | Three | Six | Six | ||||||||||||
| months | months | months | months | ||||||||||||
| ended March | ended March | ended March | ended March | ||||||||||||
| 31, 2024 | 31, 2023 | 31, 2024 | 31, 2023 | ||||||||||||
| Net loss | $ | (1.4 | ) | $ | (0.7 | ) | $ | (2.0 | ) | $ | (0.4 | ) | |||
| Add back: | |||||||||||||||
| Depreciation and amortization | 12.0 | 9.6 | 24.3 | 16.4 | |||||||||||
| Interest expense, net | 1.9 | 2.0 | 3.8 | 2.7 | |||||||||||
| Provision for income taxes | 0.3 | — | 0.5 | 0.3 | |||||||||||
| Stock-based compensation | 0.7 | 1.3 | 1.7 | 1.9 | |||||||||||
| Professional fees related to CID | 1.0 | — | 1.5 | — | |||||||||||
| Acquisition-related costs | 0.0 | 0.9 | 0.2 | 1.2 | |||||||||||
| Share of loss in equity method investment | 0.1 | — | 0.2 | — | |||||||||||
| Loss on foreign currency transactions | 0.3 | 0.0 | 0.0 | 0.0 | |||||||||||
| Adjusted EBITDA | $ | 14.9 | $ | 13.1 | $ | 30.2 | $ | 22.1 | |||||||
Adjusted EBITDA Margin for Q2 2024 is calculated as Adjusted EBITDA of $14.9 million divided by revenue of $64.9 million, or 23.3%.
Leverage Ratio is calculated as long-term debt less cash, divided by (Adjusted EBITDA for Q2 times four), and is reconciled as follows (in $millions):
| As of and for | ||
| the three months | ||
| ended March 31, | ||
| 2024 | ||
| Senior credit facility, principal | $ | 66.4 |
| Equipment loans | 12.8 | |
| Lease liabilities | 19.0 | |
| Cash | (14.6) | |
| Long-term debt less cash | 83.6 | |
| Adjusted EBITDA for Q2 times four | 59.6 | |
| Leverage Ratio | 1.4x | |
For further information please visit our website at www.Quipthomemedical.com, or contact:
Cole Stevens
VP of Corporate Development
Quipt Home Medical Corp.
859-300-6455
This email address is being protected from spambots. You need JavaScript enabled to view it.
Gregory Crawford
Chief Executive Officer
Quipt Home Medical Corp.
859-300-6455
This email address is being protected from spambots. You need JavaScript enabled to view it.
| Last Trade: | US$2.49 |
| Daily Change: | 0.08 3.32 |
| Daily Volume: | 489,959 |
| Market Cap: | US$107.290M |
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