Mr. Dennis Wilson reports

CONVALO HEALTH INTERNATIONAL HIGHLIGHTS RECORD REVENUE AND EBITDA FOR THE QUARTER ENDING AUGUST 31, 2015

Convalo Health International Corp. has had a record quarter of revenue and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter ending Aug. 31, 2015.

Total quarterly revenue exceeded $5.6-million, as compared with revenue of $2.3-million for the previous quarter ending May 31, 2015, a 145-per-cent growth rate quarter over quarter and an annualized growth rate of over 580 per cent. This quarter included only two months of revenue from the acquisition of Hollywood Detox and Accredited Rehab and Treatment Services.

September annualized run-rate revenue is expected to exceed $30-million.

Adjusted EBITDA rose to over $1-million for the quarter, an increase of more than 127 per cent from the previous quarter. Excluding corporate overhead, such as public company cost, operating margins were in excess of 22 per cent.

Full results are expected to be posted on SEDAR before their due date of Oct. 31, 2015. The Convalo management team will hold an earnings call to review the quarter in detail in early November.

Cash on the balance sheet as of Sept. 15, 2015, was $24-million.

"This quarter is a turning point for Convalo," said Michael Dalsin, chairman of Convalo Health International. "Two of the three months of this quarter represent a fully integrated addiction services company, or what we call a pod, in the heart of Los Angeles. That includes a detox centre, a men's and women's residential centre, and an outpatient centre. We have finally moved from the start-up phase to the fast-growth phase of this company. We have systematized our growth plan, bolstered our executive team and have visibility into the next few years of our business. We have launched our second pod in west Los Angeles and expect to launch our third pod in San Francisco very soon. I expect the impact of these investments to be reflected in next quarter's financials.

"Most gratifying of all, this quarter, and the subsequent month since, has proven our investment thesis. We can launch a pod with a limited capital investment and create a high-margin, vertically integrated business that can get to full capacity in a very short period of time; in the case of central Los Angeles, under one year. The result is a very high return on equity. We have over $24-million in cash on the balance sheet, which is certainly enough, without debt, to launch four additional pods in other cities around the United States. I expect each pod can generate significant revenue and earnings under the current reimbursement rates. I believe we are at the beginning of a huge market expansion and I expect that in the next 18 months, we will be able to launch these additional pods while the market is still young, maximizing our operating margins."

Pursuant to the news release dated May 20, 2015, Convalo has confirmed that the expiry date of the warrants outstanding, exercisable for 43,125,000 common shares of Convalo at 50 cents per share, will be accelerated to Nov. 11, 2015, pursuant to the terms of the warrant certificates. The acceleration is a result of Convalo's share price achieving a volume-weighted average trading price greater than 60 cents for 20 consecutive trading days around the time of closing of the Hollywood Detox Center and Accredited Rehab and Treatment Services acquisition, which was announced on May 20, 2015. The warrants were originally issued pursuant to Convalo's bought-deal private placement of 43,125,000 units (with each unit consisting of one common share and one warrant) for gross proceeds of $17.25-million, which closed on April 22, 2015.

We seek Safe Harbor.