Patient Home Monitoring Corp.
TSX VENTURE : PHM

March 03, 2015 09:00 ET

PHM Announces Execution of Letter of Intent (LOI) to Acquire a $5 Million Healthcare Business in Virginia

LOS ANGELES, CALIFORNIA--(Marketwired - March 3, 2015) -

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 (PHM) (TSX VENTURE:PHM), a profitable company with annualized revenues exceeding $50 million focused on rolling-up annuity-based healthcare service companies in the U.S., announced it has executed a non-binding Letter of Intent (LOI) to acquire a company in Virginia reporting unaudited trailing 12 month annual revenues of approximately $5,000,000 and Adjusted EBITDA of approximately $600,000.

The Virginia company provides medical equipment and services for patients with chronic conditions, specializing in mobility indications. This company offers home accessibility products and services including bath safety and patient lifts. As patients become immobile, they require more than a power mobility wheelchair. They also need home modifications to assist with their chronic conditions. This is an additional product line of services for patients with mobility conditions. PHM's current patients need these home accessibility products. After closing, the owners who are staying on with PHM, plan to help start immediately cross-selling these services across Georgia, Maine and South Carolina to patients with mobility indications.

According to the LOI with the Virginia company, PHM expects to close the acquisition for a mix of cash and stock, issuing less than 1.0% of PHM's total outstanding common shares. Closing the acquisition will be subject to final due diligence and a binding purchase agreement, expected in the current quarter.

"We now have 4 LOIs that are awaiting closing with total annual revenue in excess of $15 million," said Michael Dalsin, Chairman of the Board for PHM. "Assuming we close all 4 deals, PHM's annual revenue run-rate will exceed $65 million. I expect that this most recent LOI in Virginia will actually close first and in this current quarter, as we have such a detailed deal document and our due diligence team has already completed their work, followed by the Oklahoma and Texas businesses. The tuck-in acquisition in Georgia, with about $2.25 million in revenue, has been pushed back while we focus on larger, more strategic acquisitions in new markets with new products."

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.

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