Protech Home Medical

  • Simplifying the Patient Experience!

  • 859-300-6455

  • 1019 Town Drive

    Wilder, KY 41076

PROTECH HOME MEDICAL PROVIDES CORPORATE UPDATE Non-Core Asset Sale, Return of Stolen Funds and Executive Team Expansion Allow the Company to Accelerate its Growth

  •   9:00AM EST


Cincinnati, Ohio – September 10, 2019 – Protech Home Medical Corp. (“Protech” or the “Company”) (TSXV: PTQ), a healthcare services company with operations in the United States, today provides a corporate update including details regarding the return of stolen funds previously misappropriated pursuant to a cyberscam, the sale of a non-core asset, the strengthening of its executive team and the renewed emphasis on the Company’s strategic initiatives including its acquisition objectives.

The Return of Stolen Funds

As press released on September 9, 2019, the Company is pleased to announce the return of CAD$8.6 million which had been misappropriated pursuant to a cyberscam incident originally announced on May 6, 2019. The funds have now been returned by the perpetrator’s bank pursuant to the final Garnishee Order Absolute announced by the Company on August 16, 2019. The Company will also be repaying its Chief Executive Officer the sum of USD$2,600,000, being the principal amount, he advanced the Company in the wake of the theft as announced by the Company on May 6, 2019. This advance allowed the Company to complete its previously-announced debenture repayment.

“Obviously we are relieved that the funds have been returned. This is obviously a material positive change to our balance sheet,” commented Greg Crawford, Chief Executive Officer. “The incident, while being highly distracting for our management team, has made us very aware of such external threats and as a result, we have worked diligently to strengthen our internal and external defenses to prevent such an incident from ever happening again.”

Sale of Non-Core Asset

The Company has recently disposed of its only non-core asset, wholly-owned Patient Home Monitoring, Inc. The cash consideration at close was approximately CAD$4.5 million. Patient Home Monitoring, Inc. accounted for approximately less than 5% of total consolidated revenues in the YTD June 30, 2019 and was no longer consistent with the corporate initiatives of the Company.

Augmentation of Executive Team

The Company is pleased to announce that Mr. Thomas Roehrig has joined the Company as Executive Vice President, Finance. Commenting on the hire, CFO Hardik Mehta said, “We are delighted to welcome Tom to our team. Tom is a CPA and has over 30 years of hands-on experience in accounting and finance. His background includes being the Chief Accounting Officer of a publicly-traded US company. He brings significant experience in public company financial reporting, debt and equity financings, inventory management, and acquisition transactions. His prolific career significantly broadens our internal capabilities in these areas at this pivotal point in the Company’s development. Additionally, his addition allows me to hyper-focus on our M&A strategy and further assist Greg in operational matters leading to further improvement of our margins.”

Update on Corporate Strategy

With the combination of the return of the stolen funds, the sale of the non-core asset and the repayment of the loan provided by the Company’s CEO, the Company has the strongest balance sheet in its recent history with total cash of approximately CAD$12.5 million. As such, the Company will be immediately intensifying its efforts with respect to its previously-announced growth strategy consisting of three main components: the utilization of technology in its product offering to drive further margin expansion; increasing its DME market share at a rate in excess of the organic growth rate of the market; and, most importantly, acquiring targeted DME/HME companies in geographies that will allow the Company to further achieve regional market domination.

As the Company has shown in previous quarters, the acquisition program not only adds to its patient distribution volume, but also allows Protech to capture material hard dollar synergies relating to more favorable equipment and supply vendor spend, stand-alone administrative expenses and back office costs, all of which are significant expenses for the acquisition targets.

“The implementation of these strategic initiatives has to date, resulted in achieving significantly improved financial results since my management team was put in place in December of 2017 and I continue to be very bullish on what lies ahead for our company,” commented Greg Crawford. “The combination of our very strong cash position together with our enhanced management team will allow us to focus our efforts on more meaningful acquisition targets in a market that continues to be characterized by strong and growing demand for services and a fragmented supplier base characterized by smaller companies. Such suppliers continually struggle to achieve economies of scale and they represent a highly attractive group of targets. We are excited to now be in a position to execute on these initiatives over the coming quarters.”