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HALIFAX, Nova Scotia, Aug. 12, 2022 (GLOBE NEWSWIRE) -- NOVA LEAP HEALTH CORP. (TSXV: NLH) ("Nova Leap" or "the Company"), a growing home health care organization, is pleased to announce the release of financial results for the quarter ended June 30, 2022. All amounts are in United States dollars unless otherwise specified.
Nova Leap Q2 2022 Financial Results
Financial results for the three and six months ended June 30, 2022 include the following:
President & CEO's Comments
"Q2 was one very much spent focused on investment in our agencies to drive organic growth", said Chris Dobbin, President & CEO of Nova Leap. "During the quarter, management implemented additional organic growth initiatives through an expansion of service lines at select locations to include both private duty nursing and geriatric care management services. Over time, we believe these initiatives will allow us to become one of the largest providers of integrated care management and home care services in North America.
The improving gross margins is indicative of the Company's pricing power while operating in an inflationary environment.
Over the past couple of years, as we continued to scale, we created new positions across the Company that we believed would be necessary to support the continued growth trajectory of the business. While we have seen improvements in financial performance in a few of the agencies owned throughout the pandemic, these improvements have been offset by some agencies that have yet to recover to pre-pandemic levels and, most notably, by the one agency for which we have initiated legal action against the former owner, as indicated above. Access to the appropriate number of quality care professionals remains our largest impediment to growing the business organically in the manner we would like and is an area of continued attention.
During the quarter, as part of our focus on operational improvement and efficiencies, we eliminated certain support positions in the areas of digital marketing, accounting, corporate development and operations which allows us to be more appropriately staffed for the current operating environment. The full impact of these reductions, which allows for a leaner more efficient organization, will be realized in Q3.
We believe the organic growth initiatives, in combination with the appropriate reduction of certain staff complement, will lead to improving financial results for the remainder of the year and better position us long term. We continue to evaluate acquisition and expansion opportunities as we have in the past."
This news release should be read in conjunction with the Unaudited Condensed Interim Consolidated Financial Statements for the three and six months ended June 30, 2022 and 2021 including the notes to the financial statements and Management's Discussion and Analysis dated August 11, 2022, which have been filed on SEDAR.
About Nova Leap
Nova Leap is an acquisitive home health care services company operating in one of the fastest-growing industries in the U.S. & Canada. The Company performs a vital role within the continuum of care with an individual and family centered focus, particularly those requiring dementia care. Nova Leap achieved the #42 ranking on the 2021 Report on Business ranking of Canada's Top Growing Companies, the #2 ranking on the 2020 Report on Business ranking of Canada's Top Growing Companies and the #10 Ranking in the 2019 TSX Venture 50tm in the Clean Technology & Life Sciences sector. The Company is geographically diversified with operations in 11 different U.S. states within the New England, Southeastern, South Central and Midwest regions as well as in Nova Scotia, Canada.
NON-IFRS AND OTHER MEASURES:
This release contains references to certain measures that do not have a standardized meaning under IFRS as prescribed by the International Accounting Standards Board ("IASB") and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS measures by providing a further understanding of operations from management's perspective. Accordingly, non-IFRS financial measures should not be considered in isolation or as a substitute for analysis of financial information reported under IFRS. The Company presents non-IFRS financial measures, specifically Adjusted EBITDA (as such term is hereinafter defined), as well as supplementary financial measures such as annualized revenue. The Company believes these non-IFRS financial measures are frequently used by lenders, securities analysts, investors and other interested parties as a measure of financial performance, and it is therefore helpful to provide supplemental measures of operating performance and thus highlight trends that may not otherwise be apparent when relying solely on IFRS financial measures.
Adjusted Earnings before interest, taxes, amortization and depreciation ("Adjusted EBITDA"), is calculated as loss from operating activities plus amortization and depreciation and stock-based compensation expense. The most directly comparable IFRS measure is loss from operating activities.
Annualized revenue is calculated as actual revenue extrapolated from the beginning of the year or date of acquisition over 365 days.
The reconciliation of Adjusted EBITDA to the loss from operating activities is as follows:
|Three months ended June 30||Q1||Six months ended June 30|
|Loss from operating activities||(430,883||)||(237,575||)||(198,829||)||(629,712||)||(545,106||)|
|Amortization and depreciation||373,676||222,618||330,888||704,564||437,635|
FORWARD LOOKING INFORMATION:
Certain information in this press release may contain forward-looking statements, such as statements regarding future expansions and cost savings, timing of receipt of ERC, and plans regarding future acquisitions and business growth, including anticipated annualized revenue or annualized recurring revenue run rate growth and anticipated consolidated Adjusted EBITDA margins. This information is based on current expectations and assumptions, including assumptions described elsewhere in this release and those concerning general economic and market conditions, availability of working capital necessary for conducting Nova Leap's operations, availability of desirable acquisition targets and financing to fund such acquisitions, and Nova Leap'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 the impact of the COVID-19 pandemic or any recurrence, including government regulations or voluntary measures limiting the Company's ability to provide care to clients (such as shelter-in-place orders, isolation or quarantine orders, distancing requirements, or closures or restricted access procedures at facilities where clients reside), increased costs associated with personal protective equipment and sanitization supplies, staff and supply shortages, regulatory changes affecting the home care industry or government programs utilized by the Company (such as ERC), other 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, and these statements may not be appropriate for other purposes. 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.
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.
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