Quipt Home Medical (QIPT) - 2026 Q1 - Quarterly Report

Financial Performance - Total revenue for the three months ended December 31, 2025, was $80,996,000, representing a 32% increase from $61,381,000 in the same period of 2024[16] - Operating income for the quarter was $1,024,000, compared to $448,000 in the prior year, indicating a significant improvement in operational performance[16] - The net loss for the three months ended December 31, 2025, was $1,053,000, slightly improved from a net loss of $1,084,000 in the same period of 2024[16] - Adjusted EBITDA for the three months ended December 31, 2025, was $17,812,000, compared to $13,997,000 for the same period in 2024, reflecting a growth of 27%[80] - The company reported a net loss of $1,053,000 for the three months ended December 31, 2025, a slight improvement from a net loss of $1,084,000 for the same period in 2024[91] - Adjusted EBITDA increased to $17,812,000 for the three months ended December 31, 2025, compared to $13,997,000 for the same period in 2024, reflecting a growth of approximately 27%[96] Revenue Sources - Rentals of medical equipment generated $31,984,000 in revenue, up from $24,321,000, while sales of medical equipment and supplies increased to $49,012,000 from $37,060,000[16] - The number of patients serviced increased to 210,000, up from 157,000, representing a growth of 33.7% year-over-year[80] - The Company completed the acquisition of Mediserve Medical Equipment on July 1, 2025, and a 60% interest in Hart Medical Equipment on September 1, 2025, expanding its market presence[78] - The Company completed acquisitions of Mediserve and Hart, with Hart accounting for 20% of total revenues for the three months ended December 31, 2025[120] Expenses and Costs - For the three months ended December 31, 2025, total operating expenses increased to $41,571,000, up from $30,398,000 in the same period of 2024, representing a year-over-year increase of approximately 36.7%[62] - Stock-based compensation expense for the three months ended December 31, 2025, was $982,000, compared to $207,000 for the same period in 2024, reflecting an increase of approximately 373.9%[59] - The company reported payroll and employee benefits expenses of $27,256,000 for the three months ended December 31, 2025, compared to $19,782,000 in 2024, marking an increase of approximately 37.5%[62] - The cost of inventory sold for the three months ended December 31, 2025, was $22,775,000, or 28.1% of revenue, down from 28.9% in the same period of 2024[83] Assets and Liabilities - Cash and cash equivalents at the end of the period were $10,543,000, down from $12,916,000 at the end of the previous quarter[20] - Total assets decreased to $280,657,000 as of December 31, 2025, from $283,289,000 as of September 30, 2025[15] - Total liabilities decreased to $167,663,000 from $171,192,000 during the same period[15] - The net carrying value of long-term debt was $83,168,000 as of December 31, 2025, down from $86,635,000 as of September 30, 2025[44] - The Company’s intangible assets, net, decreased to $75,889,000 as of December 31, 2025, from $77,560,000 as of September 30, 2025[41] - As of December 31, 2025, total lease liabilities amounted to $19,496,000, consisting of $16,553,000 in operating leases and $2,943,000 in finance leases[52] Acquisition and Future Plans - The company entered into an Arrangement Agreement on December 14, 2025, for the acquisition of all common shares at a price of $3.65 per share[22] - The transaction is expected to close in the first half of 2026, subject to regulatory and shareholder approvals[24] - Upon completion of the acquisition, the company will become privately held and will be delisted from the Nasdaq Capital Market and the Toronto Stock Exchange[25] - The company aims to drive organic revenue growth and achieve operational net profit while expanding Adjusted EBITDA in the fiscal year ending September 30, 2026[79] Risks and Considerations - The completion of the Arrangement is subject to customary closing conditions, including shareholder approval, which may delay or jeopardize the transaction[124] - The Arrangement could disrupt ongoing operations and adversely affect relationships with vendors, customers, and employees[125] - If the Arrangement is not completed, the trading price of the company's common shares may decline, and the company may incur significant costs related to the transaction[127] - The Arrangement Agreement imposes restrictions on business conduct, limiting the company's ability to pursue strategic initiatives[128] - Ongoing litigation related to the Arrangement may delay or prevent its consummation, potentially leading to substantial costs[129] - The company may be required to pay a termination fee if the Arrangement Agreement is terminated under certain circumstances, impacting financial condition[127] - Limitations on soliciting competing proposals may discourage third parties from making more favorable offers[130] Cash Flow - Net cash flow provided by operating activities was $8,941,000 for the three months ended December 31, 2025, remaining relatively flat compared to $9,300,000 for the same period in 2024[101] - Net cash flow used in investing activities decreased to $1,948,000 for the three months ended December 31, 2025, from $3,648,000 for the same period in 2024, a reduction of approximately 47%[102] - Net cash flow used in financing activities increased to $9,439,000 for the three months ended December 31, 2025, compared to $5,522,000 for the same period in 2024, an increase of approximately 71%[103] Other Information - The Company recognized a foreign currency gain of $73,000 during the three months ended December 31, 2025, due to favorable exchange rate movements[115] - The Company has not reported any defaults upon senior securities during the reporting period[132] - No directors or officers adopted or terminated any trading plans during the three months ended December 31, 2025[134]