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

Joining me today is Hardik Mehta, our Chief Financial Officer. On this call, I would like to outline our core business, review our progress over the past year with a focus on the last quarter, and provide you with our updated outlook for 2020.

I hope we will leave you with the resounding impression that Protech is in a strong position in respect of its financial performance, its operations, our balance sheet, and the organic and inorganic revenue opportunities we have in front of us. We’d remind you that our remarks today will include forward-looking statements that are subject to important risks and uncertainties.

For more information on these risks and uncertainties, please see the Reader Advisory at the bottom of our results News Release as well as our MD&A. You can find these on our website, and on SEDAR.

The Company's actual performance could differ materially from these statements. On January 28, 2020, we announced our full year audited financial results for fiscal 2019.

More on those results in a moment, but first let me provide you a brief background on our story. Protech Home Medical provides a diverse offering of home respiratory services and medical equipment for treating in-home patients with chronic conditions in the United States.

The Company provides a range of products including oxygen therapy, sleep apnea treatment, certain medical equipment and custom power mobility products. We operate in 10 states with more than 40 locations across the Midwest and East Coast regions, completing hundreds of thousands of deliveries each year to more than 80,000 active patients.

With that background, I'd like to hand the call over to Hardik to discuss our Q4 fiscal 2019 financial results.

Thanks, Greg. In reviewing the audited financial results for fiscal 2019 and Q4 of fiscal 2019, please note that all financial values are in Canadian dollars, and the full results are available on SEDAR.

As many of you may know in the fourth quarter of 2019, the Company sold Patient Home Monitoring, Inc., also called PHM, an asset we determine as being noncore. As per IFRS, operating results of PHM is reported under discontinued operations.

As a result, please note that all the fiscal year end numbers for both 2018 and 2019 have been adjusted for this divestiture and are reported for continuing operations only. I would also like to clarify to our investors, because of the divestiture being reported as discontinued operations for fiscal 2019 and fiscal 2018, it will not be accurate to subtract our previously reported year-to-date numbers from fiscal year end numbers to derive fourth quarter performance for both 2019 and 2018.

In the fourth fiscal quarter, fiscal 2019, Protech completed 53,386 setups or deliveries compared to 47,581 in the corresponding period last year, an increase of 12%. The Company generated revenue of $19.5 million in Q4 of fiscal 2019, up 8% from Q4 to fiscal 2018.

Our efforts to streamline operations and standardize regional processes continues to bear fruit. Most of the 8% year-over-year growth is organic with a small contribution from the two small acquisitions done.

While quarter-over-quarter growth rate was 8%, our full-year revenue growth was 15% year-over-year. Fiscal year 2019 revenue was $81 million, compared to $70.5 million in 2018.

Recurring revenues for fiscal 2019 increased by 26% to $55.1 million, representing 68% of total revenue and were up 26% year-over-year. It has been a focus of the Company to increase this category.

Adjusted EBITDA for Q4 fiscal 2019 was $3.7 million compared to $5.2 million in 2018. However, as we have previously disclosed, the reason for the extraordinary increase in fourth quarter of fiscal 2018 was as a result of favorable fiscal 2018 year-end and out-of-period audit adjustments relating to inventory and revenues.

Adjusted EBITDA margins for Q4 2019 was 19%, which is in line with that normalized adjusted EBITDA for Q4 2018, once adjusted out-of-period and yearend audit adjustments in 2018 which I mentioned above. We expect our adjusted EBITDA margins to remain strong in 2020.

Fiscal 2019 adjusted EBITDA for full-year fiscal 2019 was $14.8 million, up 39% from fiscal 2018. At the end of fourth quarter, we had $12.9 million in cash, up from $4.3 million at fiscal yearend 2018.

Cash flow from continuing operations for fiscal 2019 was $10.5 million, compared to $8.8 million in fiscal 2018. Current assets totaled more than $30.8 million at fiscal yearend 2019 compared to $19 million in net short-term liabilities, demonstrating the strength in our liquidity.

To summarize, our balance sheet is in excellent condition, our operational base continues to grow, and we continue to post industry-leading margins. Thank you.

And with that update, I’ll turn the call back to Greg.

We have been satisfied with our operating performance over the last year and are pleased to report that solid organic growth continues into fiscal 2020. I want to take a moment to explain a little more in-depth what we are doing differently and why we have been able to achieve the results we have and why we continue to be so excited about the future.

Protech uses unique efficient delivery cost models and technology to change the way in which home medical equipment is delivered to a growing aging U.S. population.

This segment of the market, known as durable medical equipment or DME providers, is estimated to approximate $60 billion. This is underlined by the fact that over 10,000 people in the U.S.

will turn 65 everyday for the next 15 years. This is our core market.

In the last 12 months, we have set up or delivered just under a quarter of 1 million pieces of equipment to over 80,000 active patients. We operate out of over 40 locations in 10 states and now have over 13,000 referring physicians.

Our core product offering is for chronic illnesses that are treatable at home. Using streamlined logistics and distribution, Protech can offer home delivery and maintenance on this equipment, which is a first for many of these patients.

The respiratory market, one of our key target markets is interesting and that the demand for services continues to rise, but the supply side is fragmented and shrieking as significant reimbursement cuts have reduced the number of providers in this segment. There are very few companies like Protech that have the scale and competitive advantages including those from technology and logistics to benefit from such structural changes and the balance sheet to seize upon these opportunities.

I would now like to review with you the three components of our growth strategy. First, we are laser-focused on capturing market share economically and profitably.

Our industry growth rate is about 3% to 5% per year. However, we believe we can achieve more than double the growth rate of the industry as we continue to focus on significantly increasing our market share in key target regions within the markets we currently serve.

To execute on this, we are continuously hiring and training new sales representatives and will continue to expand our product base. It is important to remember that this is an industry of scale and Protech is still at the early stages of reaping the full benefits of being one of the only companies that can benefit that, given our relative size.

These benefits will further magnify as we continue to grow both organically and through acquisitions. Secondly, we continue to lead the industry in technology deployment and our use of data mining tools to drive efficiencies and profitability.

A patient's ability to order a piece of equipment, a service call or other ancillary option via the touch of a button is where the industry is headed. We have made significant investments in deploying these tools and will continue to invest in them to continue to maintain our technological advantages over our competitors.

The third component of our growth strategy is acquisitions. Our key focus for our acquisition program is to focus on geographies where we already operate so that we can best able to integrate acquisition targets onto our platform by consolidating distribution channels, driving efficiencies, and substantially improving overall profitability.

We have made two acquisitions in the last calendar year, which are well on their way to being successfully integrated. I'm very confident in our abilities to continue to integrate acquisitions as we find and execute on them.

Although we have a very robust pipeline of acquisition targets, we remain hyper-focused on closing more material acquisitions on favorable deal terms and do not intend to waiver on our acquisition target criteria and will only execute when it makes absolute sense to do. I'm very optimistic that you will see the pace of acquisitions continue or even accelerate in the quarters to come.

Overall, I sincerely believe that our three-pronged strategy has and will continue to propel our Company towards sustained financial growth and continued profitability. In conclusion, I want to leave you with three clear messages.

First, our core target market is growing and we continue to expand our market share therein. Secondly, our strong balance sheet, expanding margins and cash flows allows us to speedily respond to strategic acquisition opportunities, which continue to create a dynamic and we believe highly attractive investment opportunity.

Finally, engaging with capital markets is a top priority for us. We truly believe that our current share price, Protech continues to be highly undervalued on a relative basis when compared to its peers.

As such, we are committed to tirelessly share and promote our story to the markets to rid ourselves of that discount. As a result of our efforts, we are delighted to have attracted more attention from the analyst community and look forward to increase traction in the coming months.

While we do not release detailed forecast, I continue to stand by our previously stated objective of obtaining an annualized revenue run rate of $100 million at some point during fiscal 2020, which would equate to an increase of at least 20% on a run rate basis. I would like to take a moment here to thank the entire Protech team for its tireless efforts and its stakeholders for all their continued support.

We look forward to continuing to demonstrate strong financial results and will continue to communicate with our retail and institutional shareholders the progress we're making towards our goals. This concludes our prepared remarks.

And we will now open for questions.

Hi. Good morning, Greg, Hardik.

So question. First of all, you mentioned M&A targets, but can you just sort of talk about what kind of size you might be looking at, what multiples you might pay, and just to maybe augment the M&A strategy, do you have any -- or any conversations with traditional banking facilities for lines of credit or M&A or acquisition lines?

Yes. A good question, Doug.

Our target has remained the same. We've been really hyper-focused on companies with annual revenues of $4 million to $12 million.

And typically, we see companies like that with EBITDA margins in the mid single digits to say a 10%. And we would typically see a multiple on those that pre-integration that we would pay anywhere from 4 to 6 times for those.

And I think that would be very similar to where you've seen the two most recent acquisitions that we closed in the last half of the calendar year 2019. And I'll let Hardik kind of speak a little bit about our traction on bank lines.

Sure. And I'll just add to what Greg said.

And on a post integration basis, those multiples are relatively lower, once we integrate them into our platform and get to the margins that we have generally enjoyed. For the rest of the Company, I think those acquisitions turn to be in that two to three multiple range.

Yes, we are actively seeking traditional banking facilities and we are working on providing data to the banks. And we hope we'll have something more material to disclose in the coming months.

Just a question on the environment. I guess, a big question always surrounding reimbursement issues.

Can you talk about your product lines, and any risk from CMS about reimbursement, I guess? And in particular, maybe you can just comment on the noninvasive vent business, and what impact of that might have on your results, I guess, more so in 2021 through the competitive bidding process?

Yes. So, the competitive bid program, and that is set to take effect in January 1, 2021.

And we expect to receive more information as far as what those rates are going to look like early summer 2020. And then, we expect contracts to be announced early fall 2020.

The noninvasive ventilator, right now it's approximately about 17% or so of our overall revenue. And Medicare in that general rule of thumb is around 40% of our revenue.

And there's just a certain percentage of that that would actually be affected by the competitive bid, because it only covers major metropolitan areas. It doesn't cover the rural areas in that.

So, we would expect the actual noninvasive vent rates for us would probably affect less than 5% or so of our revenue for any changes in that particular item.

So, most of my questions are more forward-looking. The first one, I'm wondering about, could you talk about your progress so far on your two recent acquisitions?

I know that they weren't captured in this quarter, but are there any integration efforts left to work on for those?

Yes. We actually are beginning to transition our bidding platforms for Cooley, the larger of the two acquisitions, and we hope to finish that by end of March.

It -- billing integrations takes a lot of time. They were on a different platform than our -- the rest of the Company.

And those efforts are underway. Soon after that we will work on the inventory side of integration.

As far as the Acadia goes, it was on the same platform, so there was less work on that, but we continue to work towards introducing our standard practices across their platform and we expect that also to be completed somewhere between end of April.

Okay. And then just briefly also, on both those businesses, what’s the split approximately on rentals versus sales?

I think, it was in the ballpark of what we have across the Company. Acadia also has certain product lines that we have for rest of our companies, which are typically sale items.

And compared to that Cooley is more on the respiratory side. And, so, it could be more similar to one of our entities called resource capital -- resource group.

So in short, Cooley will become little bit more respirator compared to Acadia. While Acadia is also respiratory, it also has -- we have and other product lines.

Which respiratory would equate to more rentals.

On -- jumping to the M&A strategy, do you guys still think you have about $15 million to $20 million in acquirable revenue in the short term that you could afford in the short term?

I would say, $10 million to $15 million, in that range, yes. It depends on the profile that we are looking at.

We would rather focus on highly profitable companies, which sometimes -- or which you have to pay little premium for. So, that’s why I would like rather have a range than a number.

Okay. And then, also Greg, you commented on that you are expanding the sales force.

Is there any idea how many people or what the [Technical Difficulty]

Yes. So, we're looking at current geographies in that that are close to where we are, say the next town over something.

And we plan on probably hiring anywhere from three to five and that per month and that it will begin in February. And that is kind of what February looks like and we're working on the same thing from March.

We'd like to bring them on kind of gradually in that. So, we can get them into our system and make sure we're finding good quality candidates.

We had done a really decent amount of hiring in that back at the end of calendar 2019. And we're starting to bear some of the fruits in that.

The sales reps are getting their feet on the ground and obtaining referrals.

Okay. So, just for SG&A in general, is there -- do you have any sort of expectations there for the year for how much that'll increase?

I'm sorry? Say that one more time.

Do you have any expectations for SGA in general? How much it will increase this year?

I mean, not accommodating for the variable growth on the sales side. I think, we expect our SG&A to be industry standard growth rate, 2% to 3%.

Okay. And then, the last thing I'm wondering on is your warehouse consolidation strategy.

Are any of your leases up this year, or can you consolidate any of your warehouses this year? And if so, what would be your expected cost savings or margin improvement?

Yes. We don't quite have a handle on that yet.

There probably will be some consolidation in that that once we get the two most recent acquisitions consolidated, considering they're pretty close to some of our current locations, once we get them onto our software and our platform, 100% we’ll better be able to make a decision like that. So, we’d probably be in the latter half of 2020.

Thanks, operator, and good morning, gentlemen. Congratulations on recent progress.

Maybe just a couple of mundane financial statement questions. Hardik, I mean, I’m sure you know, several of your most recent quarters have had working capital balances squarely in deficit range, although that certainly turned around in the second half of 2019 fiscal year.

Wondering you just maybe comment on what your near-term working capital requirements are going to be for the core business and whether we can expect more stability at near neutrality, if there might be some fluctuation in forthcoming quarters? Then, I have a follow-up.

Thanks, Doug. I think, for the first couple of quarters of 2020, we expect a little bit more increase in our working capital needs, mostly resulting from the acquisitions we’ve done, and bringing their inventory levels to where we think.

We're currently evaluating the equipment life and equipment status for those acquisitions. And we anticipate there is going to be some additional CapEx that we might have to undertake to get their equipments to the quality of what we have for the rest of the Company.

But, we haven't made a determination on that. As you know, some of these equipments are in patients’ house.

So, it takes some time for us to kind of get a good handle on it.

Understood, good color. Thanks.

And then, equally mundane question, just on bad debt provision there. It looks as though throughout most of ‘19 that number sort of stabilized in the 1.4ish range?

Is that a reasonable expectation for us in future years, or might be -- so there's some additional margin to work from bringing that number down a little bit close to nil.

At this revenue level, I think that would be fair and it would maintain. I would not provide a guidance for decreasing.

Now, definitely with some meaningful increase in our revenue, you get better purchasing power and that does translate into better margins. But, at this point, going into 2020, I would say we maintain.

Perfect. Okay.

Thank you. And the, my counterparts have sort of focused on your M&A strategy a little bit here, maybe just one sort of related question.

And as you probably know, most of your -- or many of your public and private peers are somewhat more diversified beyond respiratory and CPAP equipment. And I think, it makes sense for you to focus on that market, clearly based on operational excellence exhibited so far.

But, would it make any sense for you strategically to sort of diversify into wound care, incontinence, other medical markets as a way to sort of leverage your existing client base, or do you intend to be more squarely focused on respiratory? And I'll leave it there.

Thanks.

Yes. Doug, I think, we continue to be hyper focused on the respiratory and the durable medical equipment market, and not necessarily the supply side.

We still have a decent amount of revenue that is generated from disposable supplies. But, we feel like our operational excellence on the respiratory and the distribution side of the medical equipment is best served at this time.

Thank you, operator, and thank you all for your participation today. As always, you can find us on the web at protechhomemedical.com, where we will be posting a transcript of this call and also our updated investor deck.

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