PHM Announces Execution of Letter of Intent to Acquire a National Business Headquartered in the Southeast With $40 Million in Annualized Revenue and $13 Million in Annualized Adjusted EBITDA

LOS ANGELES, CALIFORNIA--(Marketwired - April 29, 2015) -

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Patient Home Monitoring (PHM) (TSX VENTURE:PHM), a profitable company with annualized revenues exceeding $60 million focused on rolling-up annuity-based healthcare service companies in the U.S. and Canada, announced it has executed a non-binding Letter of Intent (LOI) to acquire a company headquartered in the southeast United States with management-adjusted unaudited annualized revenues of approximately $40,000,000 and Annualized Adjusted EBITDA of approximately $13,000,000.

PHM also provided updated details of its pipeline of acquisition targets.

The Letter of Intent (LOI) for $40 Million Revenue Business

This national business currently provides home based medical services in 19 states across the US. The Company focuses on providing high margin ventilators to patients with chronic pulmonary obstructive (COPD) conditions. The business has a substantial amount of active patients that PHM could potentially cross-sell new services and products. After closing, PHM plans to start immediately cross-selling its existing service lines across all of the acquired locations.

The three owners who started the Company were early market entrants to a new reimbursement code and have in the last twelve months increased revenue more than 100%. Their growth has been fueled by organic expansion into new territories. All three owners are taking a portion of their consideration in stock and would stay on with PHM as senior executives post-acquisition.

According to the LOI, PHM will acquire the high margin business for a total consideration of approximately $36 million in cash and less than 15% of PHM's total outstanding common shares while more than doubling PHM's EBITDA. The shares would be subject to a voluntary hold vesting over a three-year period. Closing of the acquisition will be subject to final due diligence and a binding purchase agreement.

"This is a transformational acquisition for PHM," said Michael Dalsin, Chairman of the Board for PHM. "With this acquisition, and assuming we close all of the outstanding LOIs, PHM will be about a $140 million run rate revenue company with more than $32 million in run rate Adjusted EBITDA. With this company as part of the PHM family, we are able to offer our cardiology and mobility services to patients in the majority of the US. We plan to use the technical and market knowledge of the proven executives we are acquiring to expand our high margin non-invasive ventilation services, adding significant organic revenue and EBITDA growth across our existing patient base, and perhaps most importantly, we acquire a large and untapped patient database for our other services."

"When closed, this acquisition will be immensely EPS accretive. It is expected to increase run rate EBITDA by more than 100% before any organic growth," continued Mr. Dalsin. "We will be working diligently to close this and all of the LOIs as quickly as we can. We continue to invest in M&A activities and are, with each additional deal, getting closer to our exit revenue run rate goal for 2015 of $175 million."

The M&A Pipeline Update on Closings

To date, PHM has issued Letters of Intent (LOIs) or term sheets to 12 companies with combined annual revenues in excess of $170 million.

• LOIs: PHM has executed Letters of Intent to acquire companies with an aggregate of over $81 million in revenue (including today's announcement). All executed LOIs are expected to close.
• Term Sheets: PHM has issued term sheets and is negotiating final pricing with 7 companies with an aggregate of over $90 million in additional revenue. Not all term sheets are expected to close.

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.