Protech Home Medical

  • Simplifying the Patient Experience!

  • 859-300-6455

    cole.stevens@myphm.com

  • 1019 Town Drive

    Wilder, KY 41076

Protech Enters Chicago Market With Accretive Acquisition of Health Technology Resources, LLC $5.5 Million in Annualized Revenues, and in Excess of 30% Adjusted EBITDA Margin Increases Protech’s Active Patient Count By More Than 3,000


  •   8:00AM EST

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, Aug. 31, 2020 (GLOBE NEWSWIRE) -- Protech Home Medical Corp. (“Protech” or the “Company”) (TSXV: PTQ), (OTCQX: PTQQF), a U.S. based leader in the home medical equipment industry, focused on end-to-end respiratory care, is pleased to announce that it has acquired Health Technology Resources, LLC (“HTR”), a company based in Illinois, reporting unaudited trailing 12-month annual revenues of approximately $5.5 million and adjusted EBITDA of approximately $1.65 million.

Acquisition Details

HTR is a leader in the respiratory home care services industry in the state of Illinois and presents Protech with the opportunity to expand into the Chicago area, a new and attractive metro hub in which the Company will leverage its existing first-rate infrastructure to create tremendous cross selling and patient growth opportunities as it continues to expand its presence across the United States. HTR currently serves patients from its Buffalo Grove, Illinois location (part of the greater Chicago area) and the management team has successfully transitioned HTR from a relatively small medical equipment company to a clinical respiratory-focused DME company with 16 employees. HTR’s management team has historically focussed on high acuity respiratory patients and has successfully implemented multiple growth strategies that have resulted in predictable growth and substantial market penetration, which will result in an immediate increase in Protech’s active patient count by over 3,000. HTR focuses on all aspects of home respiratory equipment with a specific focus on non-invasive ventilation therapy and sleep devices with a large ALS and COPD patient base. HTR is also licensed in the state of Indiana and provides services to patients in Northwest Indiana.

HTR developed and markets the “NIV RX Plus Disease Transition Program”. Using this unique, award-winning NIV program, Protech intends to utilize HTR’s high acuity respiratory program which provides non-invasive ventilation and plans to rapidly expand across existing locations. The NIV program makes up just over one third of HTR’s overall revenue and is also the fastest growing segment of its business. CMS has removed non-invasive ventilators from the 2021 competitive bidding program, allowing for a clearer and more predictable margin outlook and Protech is keen on bolstering its non-invasive ventilator volume as a percentage of its product mix given the ongoing strong market fundamentals.

HTR has great diversification amongst referral sources with no more than one source contributing 10%, a strong recurring revenue platform, and a very solid and diversified payor base, with minimal Medicare exposure.

Under the terms of the definitive purchase agreement, Protech will acquire HTR for total cash consideration of approximately $5.4 million. Post integration, it is expected HTR will increase Protech’s annual revenues by approximately $5.5 million and adjusted EBITDA by $1.8-$2.0 million. Leveraging existing infrastructure and payor contracts, Protech expects to achieve additional revenue generated from organic growth, cross selling and corporate synergies. The acquisition of HTR was originally announced by Protech on August 11, 2020 when it executed a non-binding letter of intent.‎

Management Commentary

“The acquisition of HTR reflects our continued effort to find quality at-home care providers with a focus on turn-key respiratory solutions that symbiotically fit into the Protech model, where we can harness our existing infrastructure to effectively capture meaningful post integration synergies. We are excited to welcome the HTR team to the Protech family,” said Greg Crawford, Chairman and CEO of Protech. “We see a tremendous amount of synergies between our companies and believe the balanced product mix, minimal reliance on Medicare, and deep referral source base will be very impactful for us and we are excited to scale our presence in the markets HTR presently serves. HTR has a very strong margin profile and is immediately accretive to Protech’s EBITDA and overall profitability, which we continue to be laser focused on as we look to the future”.

Chief Financial Officer, Hardik Mehta added, “The diversification that HTR provides along with their regional dominance will prove to be of great value to our existing portfolio. We are excited to have the opportunity to penetrate the attractive Chicago market and begin the integration process. Given our strong balance sheet, we believe HTR is just the beginning of what will be an aggressive acquisition pace for us over the remainder of 2020, including potential larger revenue opportunities as we look to accelerate our scale beyond the current run-rate revenue we have. We are heavily focused on increasing market penetration in our existing markets and adding new markets into the system. As always, we will continue to be principled in our approach and ensure we only pull the trigger when it absolutely makes sense for us to do so.”