QIPT - Earnings call transcript Q3 2021 | Quipt Home Medical Corp.

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Operator

Thank you for standing by. This is the conference operator. Welcome to the Third Quarter Fiscal 2021 Financial Results Conference Call and Webcast for Quipt Home Medical Corp.

As a reminder, all participants are in listen only mode, and the conference is being recorded [Operator Instructions]. We remind you that the remarks today will include forward-looking statements that are subject to important risks and uncertainties.

company's these the uncertainties, results site, bottom as as on reader see news SEDAR information can well at you be advisory of the EDGAR. and more as risks the included please and the release find may For on which on Web MD&A, the company's The company's materially differ could from these actual performance statements. the Crawford. At this Officer, Chairman Greg and to point, I'd call like Chief over to turn Executive

Greg Crawford

My Home us you, is operator, Chief you thank and on the Greg name Thank call. I'm all for Crawford, today Executive the joining Officer Medical. and Chairman and of Quipt

served. we continued allowed home care is the set growing national Joining to me the applauding a I always our market grow States. Mehta, into monitored the United improve providing their the Chief our by would Quipt XXX the continued delivered sights that Financial care to and us being of employees for home organic and of today including Officer. growth, The health compassion is Hardik over continued begin has care like patient to care tailwinds commitment our and superior isn't we just provide will who secular clinical lives provider motto impressive be. with share our life our exceeding to coupled fostered on growth It is robust all are year-to-date. enriching something services service quality of in we as it's XX% for exceptional who The Quipt providing we have it's patients do, expectations in

completing to intensive and able ongoing a strong to our Coast are our operate which Midwest, Quipt locations with process. organization. States of respiratory and utilizing over health to XX,XXX XX than interconnected year patients therapy we East care regional in streamline sophisticated physicians. operates patient-centric in-home model, deliveries of XX in the service the concentrated phases infrastructure leverages services throughout of ecosystem for end-to-end Southeast of delivery thousands referring technology reminder, education the hundreds in a At each across all a regions, the more Known and patient Quipt respiratory specializes out distribution footprint As active present, states United XXX,XXX successful platform, care,

execute technology organic growth closing three pronged to implementation, acquisitions. continue on driving continued accretive growth through strategy We and our

We the which workflow technology business. able to are to and to processes our leverage performance consistent improve across operations, yield continue

very We financial we aspects to part the I across regulatory organization. have footprint focus leader us be operational we XXXX United talent of results. States. provide a have in with fortitude this become to call, Respironics, additional core and strategy had expansion respiratory our on national continued resources, business, bullish and breaking our the quarter on are across a which the All decade the continues regulatory for the the update our record strongest of landscape environment will of On Philips update and care an geographical a behind third in allow the addition a strong fiscal as

to in a we polyurethane has committed As Respironics used those to are recall through respiratory Respironics related foam June, to certain voluntary you the partner many been working over Philips of of challenges in devices aware, united Philips and years, us devices. together. these the announced are fantastic

Philips with it as dialog ongoing to to entire pushed relates Our will them concludes on the cost outs. structure that be trade

we our with of to the relationships strong note business, that additional Philips to minority am directly have relates I impacted representing percentage a only supplier it category. As pleased

patients we therapy, or of significant including alternative ahead very are stopping management, ventilation. amounts BiPAP experienced have Despite either we recovery the as proactive recall, the strong getting and, of device supplier. inventory an recall, mentioned, working in Additionally, with the CPAP, not

QX. into yet are impact experienced the material not to to our QX and have financials see financial impact We a

ability have due to product to are new recall. the categories future the We striving impact in drive to setups the mitigate other and

patients to manage working team impact. job an any and physicians excellent to to work diligently minimize Our this done we future complex has clinical with will process continue and

to front, extremely in continue bullish the On an operate environment. regulatory we

those future. tailwinds propelling industry major across decision for and margin last provided ensured competitive the stability The XXXX cancel the CMS from made to a patient by of outlook this bidding program One our our mix has product our comes us program product for categories. XX foreseeable the clear of October cancellation

delivered of Turning run reached solid We and high the million. to rate our year-over-year results guidance nearing $XXX the underlying end revenue business. range

cash $XX.X and weighted million, driven heavily business in continued respiratory support was costs. by highlighted volumes, EBITDA adjusted lower ventilation performance mix through higher collections Our the of operating continuing by our and with therapy strength product to driven sleep $X.X was therapy. oxygen higher of strong Revenue million

improvement pleased are that to in June the ensuring of progress exemplifies fallen business This has expense to nine X% for the on We bad debt for processes. months an same period ending the X%. XXXX and optimal scaling billing our our XX% XXXX, compared

The locations have gives the first market position infrastructure well as as assets. platform us organic as and integrate we to rate a ourselves flexibility acquired place the efficiently to today us allows leader in to add

our of of approximately continues Our recurring revenue during revenue. XXXX, solid be XX% with the base representing first extremely recurring overall months to nine revenue

our the pivotal the on reaching us end reporting. stability exciting third rate financial provides entering to build and we for NASDAQ us revenue we look discuss $XXX forward Our call reaching I'd like the business XX May, to to run heels at is path the mid-July, locations that shareholder and results. nearing in quarter background, of and cycle value. at With time new life as Quipt XXX,XXX listing hand states Hardik company's financial and to four outlook, since model such execute on recurring a growth active the to are million set revenue further consistency base XXXX of patients over at our concluding a

Hardik Mehta

and ended quarter three and third announced US June quarter fiscal results XXXX. the for that values third financial dollars XXXX numbers, XX, financial the are all the full representing In XXXX, reviewing months evening, on our results EDGAR. available SEDAR and Yesterday please are note Thanks, nine fiscal we Greg. in months

Here XX,XXX company's of XX,XXX year, continues company patients third million of period XXXX, $XX.X fiscal or from third from respiratory year-over-year setups organic in up XX,XXX compared completed XXXX. patients are generated fiscal year-over-year in to third in fiscal the unique strong period quarter corresponding and last XX%. XXXX, compared deliveries Operating for increase to XX,XXX XXXX Quipt an above revenue key the approximately completed highlights. In resupply XX%. quarter the base XX% XX,XXX increase the or deliveries X%. the in factoring to The quarter of fiscal fiscal year, setups QX increased expenses of XXX%. it third of third customer quarter to some served corresponding XXXX was quarter XXXX, Not to an served of of quarter in In company's XX,XXX revenue compared the unique The last XX%. XX% be is was the Quipt third growth of of acquisitions, fiscal recurring XXXX QX XX% XXXX. The

capability more quarter. liabilities, for billing scale short-term an Adjusted capabilities. months compared months XX% $XX.X Cash XXXX, third in end for of million improvement June At debt $X.X ending the quarter was increase to was XXXX, nine EBITDA $XX was ending June related NASDAQ company's the for for million the to balance fiscal continuing third nine facility a $XX.X margin our representing to to Adjusted add-on add expense XXXX million year-over-year. million same was $X.X fiscal the XXXX, of compared of EBITDA the credit from to onetime acquisitions of quarter March in our million. Adjusted company XX, operations from X% to demonstrating in and the $X.X third third $XX.X revenue quarter This of the XXXX, May XX% undrawn compared compared be exemplifies For on in for the for $XX.X million more the costs an of period bad compromising the about quarter our June XXXX continues through corresponding X%. cash was at and XXXX. million than EBITDA $XX.X fiscal liquidity. quarter XXXX, to impacted of by fiscal to XX% margin ending was without million fiscal third of has end compared At strength assets revolving net XXXX. Current million the XXXX period listing totaled flow XXXX. strong

to both again number bridging range $XX NASDAQ expenses We are through We remaining target our above million, continued the our quarter our related full the strength of and end displayed once seeing reflecting results, of consistency model of XX%, of onetime a the display. revenue listing. with high revenue margins saw having proud in third EBITDA the execution

sleep We demand across by mix, and oxygen continue equipment. highlighted product growth ventilators, experience to heightened sustained all for

continue operating resulting continue a effort also continue we forward in strong a pleased quarter position seen priority growth organic we long with to us. continue very We Moreover, the look be growth the business pleased market revenue to over the are QX medium our from been acquisition industry. the tailwinds remain third accelerate third term as see a strategy. be in and and conditions to to the collections the rate, to extremely elevated our continuous performance top have light XXXX trajectory to and Furthermore, with term management cash will and which we processes. our cycle believe quarter our for has further Overall, our we increasing to better sound entire remain to near through

position States. for Our work acquisition move target infrastructure the United financial us to allows coverage in per our we candidates the us the provides to to needle and robust the significantly have quickly scale ability that meaningful

busy initiatives. as our program remainder have the expect organic and relates year We to our M&A growth very to a of it

and are industry. home with Chester M&A largest XX of of of team. the our a with the We years David from experience Director as David of to specific in one home a focus announce medical the industry. executive equipment acquisition on comes companies equipment to integration healthcare pleased a addition lead services medical David and is the

and make we thrilled our an opportunities are fast an we being cash credit revenue to more $XX look growth hand in we significant in approximately future strategic at company. believe untapped substantial million remainder hire David closing, throughout In continue and to expect and pipeline pace. ability see to facility, add have million of With the for active instrument of company forward in a to strongly We on an M&A to our this year. the $XX very the the

for We you. back with And disciplined our that to will goals ever capital are more quickly call the and allocation in scale. I'll position confident update, our strategic continue Thank Greg. than ability [delivering] market strategy our our and increase to turn

Greg Crawford

with effort leader across our goal expansion Thanks, national to in serve home of respiratory economically footprint the as growing Hardik. States. undertaking United a Quipt is an ongoing operating care the

ability scalable built a We which growth the acquired is in infrastructure have resulting significant and highly to meaningful cost businesses, integrate synergies efficiently and out opportunities. platform, revenue allows

months growth over $XX of The team. XXXX, fiscal successful new in million of for revenue. patients, the XX% nine five of three through has We organic XX,XXX first important entered quarters insurance been fiscal Quipt solid active states, first XXXX and saw added extremely the contracts

has well also Arkansas Quipt rebranded name will Year-to-date, track as driver organic having Quipt the diversified these acquired tailwinds Combining business California, post combination patient our significant This in the is markets place entities this XXXX to in a patients, to marks its growth. acquired newly setting home utilize will payers a is mixes. as product grow we of they strongly Missouri, industry, opportunity proven markets term new well integration importance believe states these possible. where record the clear, local the it to recognition, a as and We referral and an to continuing lawmakers, structural Mississippi patient and a whether it'd provide when the of continue care, be be to to entered pathway market with care sources, as Quipt brand provide sense. brands it Across Quipt or start well certain organization provides us home in each superior longer a makes serve plan the local comes of in substantial into care. underway and future brand of be the strengthens it to in ensure is brand equity transition a treated whenever as to a prevalent leading shift Florida, it

of and the work on delivery we shift incorporates We opportunities are continue potential service towards supporters after patients fee for from a to payers provide for the equipment. one for the with that service

optimal ways organization. seeing the across been the of on grow and Our benefits focused to sources are relationships team we has finding this with referral the

year, this overachieving execution. to operational relates our Turning our to as we objectives. it to growth pleased continue are Earlier

We to generating efficiencies, also cost continuing continue our structure. operating and execute leverage to organic strengthening on growth

and few technology years Our part across efforts our off have functions. due of patient communicating office our investments patients certainly technology to the to past physicians paid in platforms in back through the over cloud and based large facing

We improve cycle our use through productivity. management us These of our order our sustained continue to platform, to to the allows and actions increase in the in efficiencies, ongoing company to revenue drive invest technology resupply or automated subscription our based continue program. whether telehealth value to through operating

continue we the the to are be and to about explain what doing a we and to been differently why to take results we have achieve want a future. we I excited moment why Now depth in more have so little able

to organic sales This expansion focused and improves healthcare accretive early encourages review growth with with model deploy targeted serves a continue as engagement Moreover, benefit and also we to the capital now scalable We highly three acquisitions our and deployment monitor can on to interventions, patients. a hospitalization drive platform I treatment payers. you which with reduce would cash compliance, generation, efficient components effectiveness, successfully connected like margin generation. plan outcomes all the of strategy. drive

laser profitably. capturing share First, focused are we economically on and market

about growth X% industry year. a Our is rate to X%

regions significantly within by significantly our we in believe industry opening serve markets. share new target to as we up the focusing markets continue we key on well growth However, the can market outpace rate as increasing

front. the subscription synergies be on based our use to would which revenue lead tools in us for to continue data of provides efficiencies our for and model we deployment acquisition industry Secondly, An technology and meaningful mining resupply, the drive example robust profitability.

is The third component strategy of growth acquisitions. our

be for seamlessly looking our can into respiratory platform. scalable integrated turnkey are We operations that highly

our As at acquisition approach. we have M&A, look we facets three to

between and scale The distribution be in which our a revenue consistent being margins the million focus $XX and plus first XX% XX% range with million platform. large volume, companies by of $X on leveraged hence, and EBITDA targeting can to annual

being segment million payer national focuses with across footprint The our $X becoming This new of acquiring focused ambition on second geographical goal a expanding targets mix our provider. on states. a our revenue expanding of facet strategic sub and

EBITDA, more and that being base from facet geographical meaningful towards reach third larger focus The a standpoint. opportunities would be revenue, a patient

commencement and late markets to we exciting through be had capital based NASDAQ very trading our have milestone and US with on front, road Since conferences, we on continue to year in been completing marketing institutional the we company significant On a that active most date of May. the this have time, with the shows investors front. the steadily will

strong on and have to support. Eight initiate vision look name, We echoed research are Quipt their forward coverage investment continued remain pleased We focused Capital to community. the performance the ensuring to is

so a team beyond, for hard of company, the proud this at those and culmination of the look I going efforts. and and dedication their to work am above is our I As of evolution entire

for more our we to than the like for. stakeholders continued thank what continue landscape moment We the for excited do and tireless we Quipt growth. the company for again, a that We support. team many front care the exist we continued all position their I could Once robust active the And would in entire efforts more of current XXX,XXX in for to future for capturing to industry, tools not all of given Quipt its and the to must so. holds have be and patients us, its remain strategically the opportunities take

Operator

Cooper Securities. Doug The Beacon of Instructions] comes first [Operator question from

Doug Cooper

much Congratulations item? start as if EBITDA the how or on for include A ones couple those includes of off, million -- quick not quarter. the listing confirm does to reported, costs? I $X.X you onetime just -- indicate can of you were Can NASDAQ, that wondering transaction the a the you that cost that, or

Greg Crawford

I'll one. let Hardik take that

Hardik Mehta

$XXX,XXX. In around QX, value was approximate

spend not far So NASDAQ the $X.X million. is total of so

Doug Cooper

that $X.X is the ex to onetime So it is to million? fair item say that closer earnings adjusted

Hardik Mehta

Yes.

Doug Cooper

growth estimate my a somewhere my pro XX% XX.X% growth, would for forma Is So neighborhood the in or on organic the get for Medical a calculation contribution versus QX, that on so. versus X% be in of you QX, Just Mayhugh but full quarter-over-quarter growth QX didn't last quarter? fair? roughly quarter-over-quarter

Hardik Mehta

Yes, I about range, it's to mean in yes. X% that X%

Doug Cooper

indicated higher So that the XX% it's -- of a would you've much seasonal XX% be than annualized. month that closer to period? or Was thing nine that for sort

Hardik Mehta

say Yes, and the do for years is stick I delivering the we growth that a than we consistently row. expect three industry to been And said, that that. industry think that, correct. is X%, in the as I to continue last more I to just around always we we've mean, average that will

Doug Cooper

Revenue per patient…

Hardik Mehta

we year-over-year. going can not to I'm do say XX% a whether

Doug Cooper

Revenue up per to XX,XXX which you $XXX, patient just is a on lower than or QX. sort maybe back patients, rebound Do to to by expect of QX in little $XX.X thoughts and some was million it divided I that? get

Hardik Mehta

So as topic, that. go particular really reliable comparison. variables just don't see we of about not patient per this in as It's A revenue a metric. said great this the underneath lot have past we a

too I will that continue many way underneath what but way couldn't it will I variables whether it change you're So that. or or go see say one another, saying, just

Doug Cooper

-- QX. from operations back cash my Is then me, one, should And was there? we versus from queue. flow all in note $X.X excuse there cash that The that in from final up revenue predominantly things other and the was I'll or million jump or

Hardik Mehta

closing did we had a also Yes, June. in some from warrant acquisitions operations, flow combination of some cash were mind, that it's in keep And exercising.

of those from So it's outflow well. the acquisitions as net

Operator

Loe comes Jones Doug question Gable. from Leede with next The

Doug Loe

feedback I ones encouraged to your care respiratory home bolt-on continuing all, guess, space. of the couple about for A new me. acquisitions first about of in quick

Florida mean it in positive you is you positive a now I diversification M&A know, You Missouri and isn't as have [Technical strategies, and pretty as until clustering diversification interstate mean, geographic solid George, and to Difficulty] indicated, so and isn't. it I

a of to states you're allow So conceptualizing, of or other into to follow-up. your the firms advantage And how then might wondering Would have forward. expect I contemplated? just acquire idea do be existing you going was hubs you sort how that expand regional you previously footprint I configure to not take geographic

Greg Crawford

in that the present our expand is to that window when for is So to now us feel environment and expand. there regulatory new a plan right with into we opportunities states here that

as far that As looking patients, looking that be states around have these and that of state. a potentially expand acuity at we really our clinical been in states, would we've good fit for new that could COPD programs the a at high

a that's part definitely for So big us.

Doug Loe

the your regard to is a with the health for is with pulmonary then services mean a focused environment. an respiratory RNA are in other And especially pandemic just indications I pathway. COVID-XX and exclusively minute care

any So a configuration lot that are Difficulty]… being to your [Technical just of insights sort is a patient I any pathologies was in universe? or wondering influenced contemporary COVID service base symptom [configuration] how seeing you Are is there COVID as your any of reconfiguring

Greg Crawford

in of really home number treated our supplies. replacement active categories, especially haven't we lot seen an uptick patients, we but of certain So COVID have a and oxygen disposable a product large

shifted more seeing offices. orders that referrals as cardio another we have onset states, pulmonary throughout of coming out picking from in we’re more to considering patients of in hospitals kind physicians' think such that earlier out and of state, the COPD So come up and disease coming or tend their -- that or instead in those of of frequently that COVID that we're disease

Operator

The with Eight comes next Sepehr from question Manochehry Capital.

Sepehr Manochehry

continued operational excellence. the on Congrats

months? in looking ballpark of Could next Just regarding of the pipeline. cumulative terms estimate revenue that a you're you're the trying a say, or let's six it's deals question characterize at, number you number whether in months opportunity capture, within terms the or to the XX of possibly M&A

Hardik Mehta

call deal. definitely opportunities at looking approach translate I that continue is are of into earlier, mentioned stewards very, So we But methodical as large. the our on all revenue to to just our very number the we do guess I and a we size of good is capital. and want mean, be of going the Not the

pipeline, we single As the of we that one as would on wanted the the everything wanted just depth deploy I is could if say we depth the far if enough we to have. to every of pipeline close

depth So three opportunities to the problem a want The is We are it strategy for it's large. not with and are for that consistent make while. a deploying us. type advocating the been just sure we've into companies pronged pretty we of that

Sepehr Manochehry

mix the enter the of expansion say guess, then focusing pretty or a million currently national even you you're the I of is this in new plan? targets on $X jurisdictions to And more you looking would sub at terms are as part these

Hardik Mehta

look I can $XX be $X allocation would in terms million then it million. percentage sub terms $XX say, equal proportion But of deals, do you deals to we allocate, revenue million it of have to $X of the skewed. million of because would at and you think about in number course, I if of in

buckets, this in think the larger. also far that we think large $XX deals very about would are of each million say, getting mean I number looking is at point, in deals of projects. number are of some are, or of at looking each those quantity of I as similar I are the size those they at. pipeline as three in But these that of deals I extremely the we terms in

Sepehr Manochehry

of on of above break at that too rough kind you an kind XX% or would And total of be below estimate number, or numbers? is current or opportunity ballpark the would a XX% that

Hardik Mehta

was $XXX true value to plus cumulative it size, opportunities, the it's Way in time revenue $XXX we number about that. million more holds million revenue of than think in terms size, XX% of of last I said still

just some are that large working are Just we

Sepehr Manochehry

and kind there whether for see or midterm, that that regards there hospitals potential health? health? you changes aware funding, that payers in of are of any there home the the it's exposure shift coming specifically changes near is in government home towards the any to you’re you or Is with you're have any to industries seeing opportunities of And there out

Greg Crawford

we As months decade. for believe we've in reimbursement in that environment well that we've several a and we're been regulatory best is been the talking over environment about

bid in that categories some slight being begun seen competitive rates April. the increases XXXX, also that the oxygen some in removed changes With had here also product in XX for There's we've coming some for the LCD which that negative potential open in for new coming. would we feel up that, But oxygen additional in see that We just coverage in that patients. for nothing right fee-for-service looking start now whether and to it’d there's really the continue over payers, into that and new reimbursement lot well been in captation we decade. we're contracts still as to in area. Quipt geographical that of once at again expand best in, for more states a that We or we've cover a a in national that with that environment of feel in opportunity be

Sepehr Manochehry

contracts? in of benchmark being you -- off there meet states, you pursuing terms for you're a me broader eligible of do Do patients looking that just threshold need is be, there some to served? to that, majority in terms say is of a of would have national of let's or And you how my question to last those be

Greg Crawford

national on do that. Yes, separate that from put each think that We is we in effect I calendar QX. believe one have in take will they can it that, in believe benchmark we payer a because contract in what

company immediately the be will the to to when front help that And on really add them a excited contract. able M&A acquire national we're pretty about will So we that.

And states XX So happy payer that pleased we're that. pretty was with about talks. after ongoing particular the

Sepehr Manochehry

pipeline continue that's initial once you're the there's Presumably, probably to at going add. -- a looking

Greg Crawford

point really for on something I'll recently. it not kind until that's big in that up Quipt that and been at untapped this that's has Yes, of a focus that, say and

feel additional opportunity there's that's we ways on So the a and side payers. adding lot and of us payer of for

Operator

question Keywood The with Stifel. Justin next from comes

Justin Keywood

Philips are affected some on impact additional at to how on potential the Just give all? growth, if organic and the that context could recall, patients possibly able you

Greg Crawford

point of of that something far patients, set very the as say the the company working shortage At that's released. in something It's that sleep have a number over that we're haven't in So the is by in we devices been this the of in that minimal there that continuously chain devices. amount major it's recall. issues four will period as up considering I that, been through. supply sleep

at a issue from allocation this and we've got supply that that point very also in every We of order our that But our chain. large on that company referrals has our back life because one time, same with patients the with sleep vendors. in in are and large basically and

put back some pent-up We big once does of the date a in drop really on could be anything would chain a there's or to material. seen any that. the our don't we point or not supply that demand in time, that at on. have top have we So we're to same revenue believe be at building time line But also anything we going that

are that were will they than August. in things I So July, say better

that the I manufacturers be clear in from determine if get a what will that really don't the yet. of So But we really just trend have should that outlook think better. things the continues will timing impact and

Justin Keywood

And of your acquire? industry looking assume you're a lower in targets an disruption, I this and competitors in to off worse wide position. smaller is the to valuation this Would some of potentially some that given the be lead that deal accelerate may any processes

Hardik Mehta

lead company and measures well. issues because is not it's yes a sellers. mean, which some But supply could also we sure as the by smaller a just we we are buying bit want no. into to It would I of make chain cheaper our when little then on end, desperate some some have

on We terms We the a what and mean those keep question. acquire whether dung So is a not the I mix evaluate can like to their we it's and at Phillips of by to them versus slum that look answer others, case. case continuity. in

it an mean opportunity, after. levels could also something could at service its to while that could be historical might So buying there you soon you be and them be able not

a So balance. it's definitely

Justin Keywood

Are XX%. that first organic growth quarters, on for ventilators, able it at home and what the just therapy then mentioned segments on that you contributed oxygen on to the And different the sleep fiscal three the to bucketize being was XX%?

Hardik Mehta

No, do or down not we -- we that, to break never done and like project our we not do on have a just segment basis. revenue

else with and just think very the way way revenue works, with in of recognition I doing complicated reserves detail. a the everything it’s it especially

reason past the not we that's this still have the we been that at doing why in can point. So and

Justin Keywood

I in… just could if And slip

Hardik Mehta

On been lines respiratory definitely have contributor. the pre conference call, a

Justin Keywood

more one just question. And

Is sustainable it a believe On was the expense, going forward? bad I level opening debt at that the you that mentioned remarks. see X% in

Hardik Mehta

always X% feel as to good XX%, metrics. keep it's said We've it under long as XX%, we a we

So that, still is having say XX% I X% range would our of comfort. to said

as long it we feel As range, stays good. that in

Greg Crawford

to have closer onto to thing depending longest in rates the difficult one before that increase. to without normal being at think account assets, maybe the higher on business to the ordinary into start does the XX% time a collection could quite quarters versus bad of acquired or within lead just was so it state I time take bad and things to acquisitions. those on take most M&A expenses get activity that we some and our see platform, one them integrate really That's if operating on the takes could you debt to which billing debt, two

Operator

with next Sutherland The the Company. question from Bill comes Benchmark

Bill Sutherland

on any and terms whatever from on your impact had quick question labor impact discharges whether Delta any the I own in you've of and surge a sources, seen force?

Greg Crawford

January, months, as were time that, February Southeast for far and the have has is prevalent variant, COPD it organization. and it service And a material a would that frame yes, our in if to that that I'll we the had in lull we it employees very stayed we service number the as typically Delta but when setups summer areas exacerbation. see that in oxygen the that December, in any lot around in and we say typically of that date strong hasn't see out and disruptions will as caused So that,

Bill Sutherland

as whatever you new far been referrals? from Greg, a So facilities, in that mean home negative perspective your discharges as hasn't the accessing impacted patient

Greg Crawford

the oxygen in for primarily No, we've our an increase in variant. that home seen Delta

Bill Sutherland

how be that much of process, your maybe kind and get you've objectives the color there? in expansion by interested was there had of you sales of I one some I acquisition would force other the maybe some know great? the just implemented but then year-to-date And

Greg Crawford

So and thing facilities additional around add would in we additional and We've in most slowed sales sales months that due on will vendors to kind in sales down we three that, and that's and that more that representatives. probably targeting over and that continuum that identified side again started as is XX XX in to four letting locking the added in XX in the say that, have are we reps I currently over not COVID areas say, sales that to that, and adds more that one of markets past, things. that, in plus reps.

in. resonate and be we're very had that about additional we've and that still that. our would cautious that to we've believe the that So But and sales with we areas perspective the future identified from pretty services excited a that

Bill Sutherland

you wise So you'll well? see surge are and kick its just maybe you the a expansion to or bit as wait for wait a as for sales take going up before I step in of course that mean, obviously, -- the again, to takes productivity little

Greg Crawford

just not to is be the we things before. and really say vendors that little are new not in just to just we that and process. any a are over No, that That's and in have past I'll that the a would are we in all it's our office have are, that just in to And have some let that areas targets areas than before of or as cautious Those more of have the found one figure areas. were board they allowed traditionally in have we are the set that leading to hire considering out and are closed. we We in. make not do part that vendors these doctor's market a rules understand just a whether what

really board. over no consistency. it's all So the There's

Operator

Rahul Raymond from James. comes question Sarugaser next with The

Rahul Sarugaser

percentage more about revenue should we on of answered, result as a increase have goods. at of that been you a continue little Q&A. questions mostly color to cost give as actually forward, be goods, just already my is of Most prior me asked as forgive if this this been cost us how Is And particularly -- going that of you been of in has looking a Can thinking through the really escalate? recalls?

Hardik Mehta

So the little drivers to key reason the the how high revenue proportional Sales sold. the to sales higher is, inventory year this are on it's it course, is a total of proportioned is as revenue rental the and revenue.

proportional the inventory a are see just dollar-for-dollar lower increase in sales increase going So revenue the on dollar for side. to increment

we reflection probably it, as say how the would year-to-date that's number about use a basis. you sustainable will on and far guidance giving what see a of As on see we

Rahul Sarugaser

we've revenue, But push closer looking it's sort further of of XX.X% sort XX% to XX% bit little historically, to pushing XX%. just of been a to at proportion there, whereas a as

sort dollar So it on increased for a dollar basis, of has marginally.

slight to that modeling accurate historical using have our going So we make why sure versus being I that forward, this more been? outlier that's might potential wanted purposes, maybe the for are number quarter

Hardik Mehta

encourage exactly guidance year-to-date why the numbers. purposes, that's are in guys, The the analyst you said community, for would anomalies And factored the we use to number. already year-to-date I

So feel percentages we can that strongly used and comfortable year-to-date for suggesting with modeling. be the very

Rahul Sarugaser

stop And strong quarter. saying the should congratulations I on by

Operator

Chelsea from iA The next question Stellick with Capital Markets. comes

Chelsea Stellick

have just latest in of a I the couple on acquisition. questions, particular

cross-sell First understand to just you want off, I of how much kind respiratory new this can acquisition? through

Hardik Mehta

not at whether we companies the with the completed a Louis the the don't the could we have has But great previously presence as the under is on Louis] we acquisition time, anticipate in opportunity we it a that, would company at in Missouri, the have they we new respiratory we Missouri new other in a The that much of for program. opens do state But all. market to acquired use of respiratory But the the just So us. same up expand also that new previously to far doing company. do into state, do plan as June, which a acquired in under market St. the enter acquisition. [St. market from contract acquisition

Chelsea Stellick

And I just… guess

Hardik Mehta

that need market. the you and to do contract the Within respiratory to

Chelsea Stellick

another that. I there I don't I think talking know on top. if was person the missed

Hardik Mehta

also one Missouri Louis. has leverage June in for use whole companies saying and state, we payer was that I the that in contracts just that acquired to including we the St. plan of

Chelsea Stellick

bit you just mentioned is much follow-up And DME I operations being is last acquisitions DME. key acquisition I one your target. respiratory how should looking turnkey going that focus a that. growth, for that as guess at was focal that? forward know points a Is sort on The earlier that I of traditional acquisition at not look little to be of on a going or -- type more traditional as your

Hardik Mehta

I don't, mean -- we at look each basis. So individual we portion on

in it the companies just So as different has that have see typical from you product profile portfolio. recent respiratory acquisition, most can the than our a we

makes contract it cross-selling with strategy as long our to it geography and as deals. those of on abilities, as as So falls the long and execute we will sense expansion payer continue

Of doesn't respiratory course, do mean we acquisitions turnkey all fit highlights. we same programs prefer but do the that that will exact

Chelsea Stellick

mentioned. color how operations? contracts you And How just they to just question more last to bit long get that the from material one I insurance these Hoping contracts, little are are on me. guess a

Hardik Mehta

They longer the over run could contracts. be payer on transformational the

is the you go lives national and increases program contracts you footprint you export and get when that back it, post helps with your some go M&A how you and price cover as can b, justified. more and and to perspective for substantially you close and can our payers that overall As ask

having going in coverage critical more if is space. health to So definitely care in I think are having lives be the more the you footprint,

Operator

Doug next with Beacon from question comes Securities. The Cooper

Doug Cooper

and where to he Just How on how take it him follow running long When David it up did long hire, up, And Chester, from. take is a get… get The of doesn't speed will just to to business? to would productive? him couple follow-ups. and be long to take see up your he's new start he

Hardik Mehta

on my we be going the doing help primarily up weeks full had our just end, end I some the a on great kind you couple of speed. And as David have. just expedite running and is him of about for actually a week We've and of asset up was and and great know, pipeline a M&A a to that to on already portion now, he's now.

process. So I mean, guy. He a very M&A. He he's seasoned understands understands

extremely philosophy we have. we ready aligned to everything to on round roll. is the that what are call He the We time. up way, pick Quipt There no currently has and he's

Doug Cooper

they opportunities large company larger came did a from certainly focused was The number just so of primarily on deals.

possibility prior that them. by other judging stock people guess more from assuming at of run around any least that has or bring sure news he is some some his to into trouble does So company Rolodex them? with I'm situation? type and get price I there for this the

Greg Crawford

else, medium have someone over here, we in have we no sizes. that say and that's fully would have focus hiring of what our expect pipeline and closing potentially is and something we the expectations that in pipeline, I our deals in to near the deals that the of full happen the our and all term term to that and on may bringing own belong someone

As XXXX, in have as of big we that we in opportunities path and talent here close as organization, And leadership that's the add continue throughout definitely been XXXX that, focus into far that down hires, us going we'll new feel I ours. and out fill. do in especially think that you a roles to will we see as to continue

Doug Cooper

hit the rank And companies you you're But rank you that at the goal of million do space, my that. of that now benchmark you think in that level? or final you milestone do $XXX you where [Dovetail] of surpassed is Apria your question you'd guys, Lincare, obviously, bigger. obviously revenue, Where think spear in

Greg Crawford

big by unique and we're just we that, the that bankers four not that the companies see market in in industry familiar in top five, with sit that I that are that, definitely, mean, things spot. hitting they in out I that in told revenue. very the that some likely we like other been do plus that in think And top top XX. we believe a here mean very there. $XXX I you research, also definitely if rate don't take in five, our mean, We top XX, the think the We've from run we're if out million out

quarter I than as kind was us We that earlier We a the that We're hit end inflection we to spot hit there's We that guided feel that growing million We had here hit in great of for nice think for far we and $XXX that of full higher expected. a a sit us. kind opportunity from XXXX. real point. really really good. grow here. calendar really a to as

Hardik Mehta

we four. million kind on I'll maybe footprint there really subjective add a mean, have, you Greg they look at two local has comes very of take one anybody we along do that to but after as out I there they kind first think the that But that. And the size mentioned. the states. not -- the focused which have little don't players asked and two more, you of might footprint or we well. do $XXX more few question, of are are that it plus, or the that that footprint maybe of that a just three very bit I with When out it's have, top a four to out the there's revenue be

Operator

Securities. with question Dick Colliers The Ryan comes from next

Dick Ryan

on bit What's $XXX current the to in thoughts timing that's next I million think been a milestone, So your getting of your range? mentioned the $XXX hitting early. that Greg, you million

Greg Crawford

XX% So XXXX. that we've rate We're kind of nice that at talked about being calendar really plus. growing

also on definitely So XX% with big to factor that organic hire laser those that's the if accelerate. integration acquired that. of integration an pick of important M&A. going you kind us assets. and of that focused that for our up a And to We we have stay of in growth just we piece think is the thing That's some

that sooner expected. have happen one rather than our quarter years earlier could two it in we goals row and a exceeded later, So than

a Going bigger sheet is million the we balance and from $XXX have that that. leap, but support $XXX also million to to

Dick Ryan

coming pricing benefits see you way? or your any Do you continue to are seeing vendor

Greg Crawford

with will with platforms at vendors. whether look allow great at our lower vendors us and to to profitably. better and and potential our of partnerships allow have relationships that We also that business all we to We're in patients vendors profitable, all through for more our of or can always technology look So being that that's pricing. serve us ways sorts grow working our our that

Operator

would turn closing the concludes This for I like session. Greg back conference remarks. to over any question-and-answer Crawford the to

Greg Crawford

operator, you, participation and all your thank you Thank today. for

be web also can find where at updated the us a this always, will transcript on investor quipthomemedical.com and our deck. of we posting call As you

discussed On great call. you and can the view the this exciting site, also you, Thank on and some developments products of have a day.

Operator

This call. concludes today's conference

you disconnect lines. day. and Thank have for participating, a may You your pleasant

Quipt Home Medical (QIPT) 24 Aug 212021 Q3 Earnings call transcript