Protech Home Medical Reports Solid Fourth Quarter and Audited Full Year Fiscal 2019 Financial Results Posts Revenue Growth of 15% and Adjusted EBITDA Growth of 39%
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CINCINNATI, Jan. 28, 2020 (GLOBE NEWSWIRE) -- Protech Home Medical Corp. (the “Company”) (TSXV: PTQ), a healthcare services company with operations in the U.S., today announced its fourth quarter and audited full year fiscal 2019 financial results and operational highlights. These results reflect the Company’s divesture of the business and assets of Patient Home Monitoring, Inc. (“PHM”) and PHM’s financial results are reported as ‘discontinued operations’ in both fiscal 2019 and fiscal 2018.
Financial highlights from the fourth quarter and year ended September 30, 2019:
█ Full-year revenue for fiscal 2019 was $81.0 million compared to $70.5 million for fiscal 2018, representing a 15% increase in revenue year-over-year.
█ Revenue for the fourth quarter of 2019 was $19.5 million compared to $18.0 million for the same period in fiscal 2018, an increase of 8%.
█ Recurring Revenue increased from $43.6 million in fiscal 2018 to $55.1 million in fiscal 2019, a 26% increase year over year, and represented 68% of total revenue for fiscal 2019 and 67% of total revenue for in the fourth quarter of 2019.
█ The ratio of Recurring Revenue to total revenue increased from 62% in fiscal 2018 to 68% in fiscal 2019.
█ Adjusted EBITDA for the fourth quarter of 2019 was $3.7 million (19.0% margin), compared to Adjusted EBITDA for the fourth quarter of 2018 of $5.2 million (28.6% margin). Fourth quarter of 2018 was positively affected by out-of-period audit adjustments primarily to inventory and revenue, resulting in a higher Adjusted EBITDA and corresponding margin.
█ Adjusted EBITDA for fiscal 2019 was $14.8 million, compared to $10.6 million for fiscal 2018, an increase of 39%. Adjusted EBITDA margin increased to 18.3% for fiscal 2019 from 15.1% for fiscal 2018.
█ Cash flow from continuing operations improved from $8.8 million in fiscal 2018 to $10.5 million in fiscal 2019, an increase of 20%.
█ A cash balance at September 30, 2019 of $12.9 million compared to $4.3 million at September 30, 2018.
█ As disclosed on September 10, 2019, the business and assets of PHM, a non-core operation, were sold for approximately $4.5 million.
Operational highlights from the three months ended September 30, 2019:
█ Through the Company’s continued use of technology and centralized intake processes, respiratory resupply set-ups and/or deliveries increased to 12,727 for the three months ended September 30, 2019, compared to 10,392 for the same period ended September 30, 2018, an increase of 22%.
█ Compared to fiscal 2018, resupply revenue increased by 17%, set-up/deliveries increased by 15% and average revenue/order increased by 2%.
█ Compared to 69,500 unique patients served in fiscal 2018, the Company served 76,146 unique patients in fiscal 2019, an increase of 10%.
█ Compared to 194,535 unique set-ups/deliveries in fiscal 2018, the Company completed 207,762 unique set-ups/deliveries in fiscal 2019, an increase of 7%.
█ As a result of better intake process, utilization, cost rationalization, etc. amongst various other measures, gross margins increase by 1.8% and medical equipment-related depreciation declined by 10% year-over-year.
█ The increases in three-month and twelve-month revenue are due to the Company’s integration efforts to standardize regional processes and operations including to various degrees: changing product focus, product mix, sales practices, billing practices, ordering practices, and recurring operational protocols as well as the acquisition of two businesses in fiscal 2019.
█ The Company continues to expand its sales reach across ten US states by the addition of experienced sales personnel.
“I am very pleased with our fiscal 2019 financial results,” said CEO and Chairman Greg Crawford. “For two consecutive years, we have demonstrated consistent revenue and Adjusted EBITDA growth and substantial improvements in EBITDA margins. We have also demonstrated that we can acquire businesses at highly attractive multiples and successfully integrate these businesses onto our platform. Through robust organic growth, and with the two most recent acquisitions consummated in late calendar year 2019, Protech expects to exceed $100 million in annualized revenue at some point in fiscal 2020. In addition to our continuously improving financial results, our balance sheet is extremely healthy with a sizeable cash balance allowing us to focus our attention on larger, more transformative acquisitions. I am extremely proud of the work we have done this year and continue to be extremely confident in our continued financial success, I’d like to thank the entire Protech team for their tireless efforts and stakeholders for all of their continued support.”
Chief Financial Officer Hardik Mehta added, “We continue to grow our business at an impressive rate, far exceeding the industry growth rate. In addition, our recurring revenues have substantially increased over the last year from 62% of total revenue in fiscal 2018 to 68% in fiscal 2019, resulting in a 26% growth in that category. We are particularly pleased that our Adjusted EBITDA margin remains strong and consistent and, more importantly, continues the trend in demonstrating year-over-year operational improvements. These metrics, together with revenue growth, remain a key focus internally from a financial perspective. Going into 2020, our focus will continue to be on improving our margins and ongoing implementation of our targeted acquisition strategy. Finally, as we continually engage with potential acquisition targets, we will continue to use a disciplined approach and will only close transactions that will add the most value to our shareholders.”
The financial statements of the Company for the three and twelve months ended September 30, 2019 and 2018 and accompanying Management Discussion & Analysis (MD&A) are available at www.sedar.com.