Dear shareholders and investors,
I am proud to report Premier Health’s results for our second quarter ended March 31, 2021, and to share the quarter’s activities and achievements.
Second Quarter Results and Operations
We are following our growth trajectory by increasing our revenues organically and through acquisitions. The consolidation of Code Bleu for a full quarter had an important impact on the company’s revenues that reached $17.0M for the 3-month period ended March 31, 2021 ($30.4M for the first 6-month period compared to $8.3M for the same period in 2020). This translated in an adjusted EBITDA of $1.8M ($3.1M for the first 6-month period compared to $0.9M for the same period in 2020) and a net income of $0.8M ($1.6M for the first 6 months period compared to -$0.7M for the same period in 2020). Our average gross margin of 25.3% for the quarter and 26.7% for the first 6 months of FY2021 was again in line with our industry target of 25%. We concluded the acquisition of Solutions Nursing on March 17, 2021, and accordingly the consolidation of this additional business unit didn’t have a material effect on the Company’s results yet. However, the impact of this recent acquisition will be fully accounted for in the third quarter of 2021.
Over the quarter, our 3 main business units showed robust organic growth. With approximately 4,600 healthcare professionals currently active on its platform, the company reached a total of 269,500 billable hours in the second quarter (461,425 for the first 6 months period) and could reach the impressive milestone of 1,000,000 hours billed for the current fiscal year.
The advent of COVID’s third wave was anticipated but is nevertheless having an important impact on regional healthcare systems. The different actions and policies put forward by provincial authorities trying to balance public health issues, healthcare systems’ limits and populations’ expectations are creating important regional discrepancies in how the disease is progressing. Different strategies including mitigation, suppression and elimination are tried and tested in function of regional priorities. However, it always comes back to the availability of resources, which we are here to provide. Premier Health has taken additional steps to open a channel of communication with representatives of different ministries in order to facilitate the integration of outsourced medical personnel in the existing health organisations’ protocols. We strongly believe that a better integration of public infrastructure and private solutions enables a better continuity of service to the population.
Acquisition of Solutions Nursing
We acquired Solutions Nursing L.F.C. Inc. and Formation Solutions Nursing Inc., for a total consideration of C$2,7M on March 17, 2021. Solutions Nursing was founded in 2003 with the mission to provide specially trained nursing staff to northern health organizations and in remote areas of Québec and Nunavut. This acquisition consolidates Premier Health’s Nordik division market position in Canada’s northern regions. Solutions Nursing generated revenues of approximately C$4.5M (EBITDA of C$0.6M) in 2020 and we expect this business unit to generate important organic growth in the course of the next 2 years as its operations are transferred and integrated on our platform. Solutions Nursing has also developed a proprietary specialized training program that is recognized by all public authorities in Québec and Canada. We see the integration of their training program and its related content on our platform as an important growth vector as it accelerates online recruiting and training. This is paramount at this stage as we start our Canadian expansion.
Technology is the corner stone of our growth strategy and Premier Health expects to spend a minimum of 2% of its revenues annually in the maintenance and development of new technologies. New features and applications are constantly being rolled out. This quarter we updated our timesheet calculator module to track work shifts by minute increments in order to allow by-the-minute billing. This new feature maximizes the invoicing function for both the nurses and the company. We estimate that this will represent an approximative 2% gain in revenues on an annual basis.
Predictability features were also added to our calendar module. AI functions are now used to predict which nurses or care attendants are more likely to accept specific work shifts, including complex multiple work shifts. This translate into the ability to offer multiple work shifts to one individual in one single block. Finally, we refined our territory management features to automate the management of geographical exceptions by allowing nurses and other personnel to manage these exceptions requests instantly via our mobile application. These two new features translate into efficiency gains for the company and added flexibility for the personnel.
As I wrote before, Premier Health’s corporate strategy evolves around three development axes, namely technology, recruitment and acquisitions. We are actively seeking transaction opportunities in other Canadian provinces, namely in Ontario which represents the biggest market in Canada for our type of services. The company has the critical mass and the liquidities to be active in this highly fragmented market.
The company is also moving forward with its technology development strategy aimed at extending the capabilities of its platform to address different aspect of healthcare services delivery. Availability and retention of medical personnel is the industry’s bottle neck and accordingly our short term focus will be put on accelerating, facilitating, and automating recruitment. We believe that this specific focus will give the company an important edge in terms of organic growth and will facilitate our involvement in different healthcare systems across the country.
We had an excellent track records in terms of acquisitions and integration and so far, we see no factors that could mitigate our growth path across the country in the foreseeable future.
I wish you all the best,
Chief Executive Officer