PHM Announces Execution of Letter of Intent (LOI) with Acquisition Target with $14 Million in Annual Revenue; A Re-Alignment ...

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. 


Patient Home Monitoring Corp. (TSX VENTURE:PHM) ("PHM") announced it has
executed a non-binding Letter of Intent (LOI) to acquire a profitable, $14
million annual revenue company, servicing patients with chronic pulmonary
illnesses. The purchase price is proposed to be less than 3.2 times 12-month
Adjusted EBITDA. The acquisition of this growing and profitable company is
expected be immediately accretive to the income statement and will substantially
increase PHM's earnings-per-share (EPS). As a result of this acquisition, PHM's
annual revenue run rate is expected to be over $28,000,000. 


PHM also announced it is promoting Andrew Folmer, PHM's Chief Financial Officer
to interim President, and Bob Kusher will shift from his current role as Chief
Executive Officer and member of the Board of Directors to focus exclusively on
increasing pharmacy sales within PHM subsidiary, Hollywood Healthcare. Mr.
Kusher will also be leading the newly-formed Strategic Market Group within PHM. 


Acquisition 

PHM has agreed to pay an expected acquisition price of 3.187 times 2013 Adjusted
EBITDA, subject to further due diligence. Based upon the LOI, PHM expects to
close the acquisition with less than $1,000,000 in cash with the remainder of
the consideration being paid in PHM common shares. For the equity portion of the
consideration, the sellers have agreed to take PHM shares priced at US$0.26 per
share. Key executives of the acquisition target company have agreed to join PHM
in senior management roles. Shares issued as part of the acquisition are
estimated to be less than 5% of the total common shares outstanding. PHM plans
to assume less than $400,000 of debt as part of the acquisition. Closing the
acquisitions will be subject to final due diligence and a binding purchase
agreement. 


When this company is added to PHM's current operations, the expected revenue run
rate of all entities, based upon the combined 12-month trailing revenue, will be
an increase of nearly 100% of the current PHM annual revenue run rate of
$14,000,000. This acquisition is also expected to generate double digit Adjusted
EBITDA growth from the prior reported quarter (subject to final due diligence).
After the acquisition, PHM is expected to have cash in excess of $6,000,000 for
future acquisitions. 


The company is located in the southeastern United States and services patients
with chronic pulmonary disease. This is an established company that has been
profitable for many years, and is well positioned to thrive in the changing
reimbursement environment. The acquisition is slated to give PHM additional
locations and patients to increase organic growth through cross-selling
opportunities with PHM's existing cardiology services and pulmonology drug
distribution services. Combined, these businesses service thousands of patients
with multiple chronic illnesses that may benefit specifically from PHM's
Coumadin testing services and pulmonology drug distribution services. 


"With this acquisition, we are finally moving toward some scale in the market,"
said Michael Dalsin, Chairman of PHM. "By almost doubling the size of PHM with
this deal, we will have better access to pricing from suppliers and a sizable
increase of our total patient database to increase cross-selling. These factors
should contribute to increased profit growth. We have over a dozen additional
deals in the pipeline and continue to believe we can close additional earnings
accretive acquisitions with our current balance sheet of over $6,000,000 in
cash." 


Re-Alignment of Senior Executive Staff 

The Board of Directors has decided to re-align the executive staff to better
reflect the needs of the current business. Andrew Folmer, PHM's Chief Financial
Officer, will assume operational leadership of PHM as interim President of the
Company. Mr. Folmer will focus upon maintaining and improving current operations
and profitability of existing and acquired businesses. PHM will also form a
Strategic Market Group, comprised of PHM executives and staff, who will be
charged with the crucial task of identifying markets for expansion,
cross-selling, acquisition opportunities, organic growth opportunities and due
diligence of acquisition targets post LOI. Bob Kusher will shift from his role
as CEO and Director to Chair the Strategic Market Group. Mr. Kusher will also be
charged with increasing revenues and gross profits through the pharmacy channel
for products and services such as PHM's Coumadin testing program, complex COPD
services, and Med B programs. 


"These changes are a reflection of the recent strengthening of our management
team," stated Bob Kusher. "I am comfortable handing over operational leadership
to this capable group, and I look forward to dedicating my energy to building
PHM's revenues through acquisitions and expanding our patient base by increasing
our number of pharmacy relationships." 


"I am very enthused to take on this leadership role," said Andrew Folmer,
interim President and CFO of PHM. "A key component of success in acquisitions is
integration. I am hyper-focused on ensuring we run a smooth and efficient
operation as we acquire more and more companies."


About PHM 

The explosive growth in the number of elderly patients in the US healthcare
market is creating pressure to provide more efficient delivery systems.
Healthcare providers, such as hospitals, physicians and pharmacies, are seeking
partners that can offer a range of products and services that improve outcomes,
reduce hospital readmissions, and help control costs. PHM fills this need by
delivering a growing number of specialized products and services to achieve
these goals. PHM is a positive cash flow and profitable company that serves
patients with heart disease and other chronic health conditions, this operation
is a platform for acquisitions and organic growth. PHM is focused on a highly
fragmented and developing market of small privately-held companies servicing
chronically ill patients with multiple disease states caused mainly by age and
obesity. Because of the new and highly fragmented nature of the market, PHM is
actively working to identify and evaluate profitable, annuity-based companies to
acquire their patient databases and technical expertise at favorable prices.
PHM's post acquisition 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. The expected result
is growing EPS with each acquisition and growing revenue and profits from the
cross selling efforts.


These Adjusted EBITDA figures are unaudited and may change subject to due
diligence and closing procedures. They are intended only as an estimate of
trailing twelve month Adjusted EBITDA of the combined entities and are not meant
to convey forward looking information. 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, and owner compensation. 


Information in this news release that is not current or historical factual
information may constitute forward-looking information within the meaning of
securities laws. Implicit in this information, particularly in respect of the
future outlook of PHM and anticipated events or results, are assumptions based
on beliefs of PHM's senior management as well as information currently available
to it. While these assumptions were considered reasonable by PHM at the time of
preparation, they may prove to be incorrect. Readers are cautioned that actual
results are subject to a number of risks and uncertainties, including the
availability of funds and resources to pursue operations, 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, competition, low profit market segments
as well as general economic, market and business conditions, and could differ
materially from what is currently expected. 


Neither 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. 


This press release does not constitute and the subject matter hereof is not, an
offer for sale or a solicitation of an offer to buy, in the United States or to
any "U.S. Person" (as such term is defined in Regulation S under the U.S.
Securities Act of 1933, as amended (the "1933 Act")) of any equity or other
securities of PHM. The securities of PHM have not been registered under the 1933
Act and may not be offered or sold in the United States (or to a U.S. Person)
absent registration under the 1933 Act or an applicable exemption from the
registration requirements of the 1933 Act. 


FOR FURTHER INFORMATION PLEASE CONTACT: 
Patient Home Monitoring Corp.
Michael Dalsin
Chairman
(323) 253-3055
Patient Home Monitoring Corp. (TSXV:PHM)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024