Nova Leap Health Corp. Completes Purchase of Home Care Business in Eastern Canada
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
HALIFAX, June 4, 2018 – NOVA LEAP HEALTH CORP. (TSXV: NLH) (“Nova Leap” or the “Company”), a company focused on the home health care industry, is pleased to announce it has completed the acquisition of Always Home Homecare Services Ltd. and its subsidiary Always Safe Training Ltd. (collectively, “Always Home”) located in Dartmouth, Nova Scotia for $2.12 million. The purchase price for the acquisition was paid with $1.85 million in cash, partially financed by a demand loan of $0.77 million from a Canadian Schedule 1 Bank, and a $0.27 million promissory note issued to the vendor payable over a two-year period. The execution of the definitive agreement and related information pertaining to this acquisition was previously announced on April 3, 2018. All amounts are in United States dollars (“USD”) unless otherwise specified.
“We look forward to working with the team at Always Home”, said Chris Dobbin, President & CEO of Nova Leap. “This is the first step in our plan for a broader expansion across Nova Scotia.”
Nova Leap incorporated a subsidiary, which has purchased all the issued and outstanding shares of Always Home and will continue to operate the business under the name Always Home. The acquisition represents Nova Leap’s sixth overall investment in the home care industry, and first investment into the Canadian market. Nova Leap now has more than 450 employees in Vermont, New Hampshire, Rhode Island, Massachusetts, and Nova Scotia.
Nova Leap Exceeds $11 million of Forecasted Annualized Recurring Revenue
The acquisition of Always Home is expected to be immediately accretive and, when combined with existing Nova Leap subsidiaries, is expected to result in 462,000 forecasted annualized recurring client service hours. Nova Leap’s forecasted annualized recurring revenue run rate is in excess of $11 million following the acquisition of Always Home. Nova Leap’s recurring client service hours are paid primarily by clients, the Department of Veteran Affairs, or through long term care insurance plans.
The forecasted annualized recurring revenue run rate disclosed in this release is the expected annualized recurring revenue based on the Company’s most recent month’s revenue for current operations multiplied by 12 plus the annual revenue based on the most recent financial information available for Always Home.
About Nova Leap
The Home Care Providers industry is becoming one of the fastest growing healthcare industries in Canada and the United States. Home care saves patients billions of dollars every year by treating them in their own homes instead of in hospitals. An aging population, the prevalence of chronic disease, growing physician acceptance of home care, medical advancements and a movement toward cost-efficient treatment options from public and private payers have all fostered industry growth. Nova Leap is focused on a highly fragmented market of small privately-held companies providing patients one on one care in their homes. Nova Leap’s post-acquisition organic growth strategy is to increase annual revenue per location through a combination of increased employee investment, including training, focused sales and marketing efforts, billing rate increases, expansion of geographical coverage, and improved referral sources.
FORWARD LOOKING INFORMATION:
Certain information in this press release may contain forward-looking statements, such as statements regarding the Company’s plans for expansion in Nova Scotia, the increase in the Company’s forecasted recurring client service hours and forecasted annualized recurring revenue. This information is based on current expectations and assumptions, including assumptions concerning economic and market conditions, the Company’s ability to integrate its acquired businesses and maintain previously achieved service hour and revenue levels, that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. Risks that could cause results to differ from those stated in the forward-looking statements in this release include regulatory changes affecting the home care industry, unexpected increases in operating costs and competition from other service providers. All forward-looking statements, including any financial outlook or future-oriented financial information, contained in this press release are made as of the date of this release and included for the purpose of providing information about management’s current expectations and plans relating to the future. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in the Company’s filings with the Canadian securities regulators, which filings are available at www.sedar.com.
For further information:
Christopher Dobbin, CPA, CA,
Director, President and CEO Nova Leap Health Corp.,
T: 902 401 9480 F: 902 482 5177
Vice President Renmark Financial Communications Inc.
T: 416 644-2020 or 514 939-3989
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.