Mr. Guy Daoust reports

PREMIER HEALTH REPORTS THIRD QUARTER RESULTS

Premier Health of America Inc. has filed its unaudited quarterly consolidated financial statements and MD&A (management's discussion and analysis) for its third quarter ended June 30, 2023.

Summary -- third quarter:

• The corporation had revenues of $23.6-million for the third quarter ($22.4-million for the same period in 2022).
• Gross margin for the quarter was 27.4 per cent, slightly above the company's long-term target of 25 per cent.
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter was $2.7-million ($1.6-million for the same period in 2022).
• Higher revenue and adjusted EBITDA are the result of the termination of COVID-19 emergency measures set last year by the Quebec Ministry of Health.
• Net income for the quarter was $500,000 ($400,000 for the same period in 2022).

"We are pleased to show improved results driven by a return to normal of our gross margins. CHCA continues to deliver results in line with the expectations we had when we purchased it last year and we are looking forward to closing our recently announced transaction in British Columbia. The addition of Solutions Staffing Inc. to our portfolio will further improve our diversification as we reach our goal of having a coast-to-coast footprint. Our eyes remain open to consolidate more assets in Ontario and the rest of Canada," said Martin Legault, chief executive officer of Premier Health. "We'll continue to rigorously manage our existing assets, as we monitor the evolving Quebec market."

Business highlights:

• The corporation provided 217,100 hours of service during the quarter;
• The special measures imposed by the Ministry of Health last year were lifted as of Jan. 1, 2023. As a reminder, these measures were adopted in response to the pandemic. They imposed pricing below existing contracts awarded through a competitive public procurement process;
• The corporation's four subsidiaries were awarded contracts under Quebec RFP 2023-8017. The contracts became effective respectively on June 1 for remote regions and June 19 for metropolitan areas;
• Acquisition of Solutions Staffing (British Columbia, Canada), announced on July 4, 2023. Closing is expected before the end of the current financial year;
• Continued development of the company's LiPHe platform to further improve automation of its business processes. Deployment is in process at some of the company's subsidiaries.

Province of Quebec

The company expected a gradual return to normality in 2023. However, the National Assembly of Quebec sanctioned Bill 10 on April 20, 2023. Bill 10 mainly states that the Ministry of Health can decide where, when and for how long institutions can use independent labour. Such decisions need to be enacted through the issuance of specific directives. On July 26, 2023, a draft of the directives was issued. The directives call for certain target dates by which specific regions should stop using independent labour, restrictions on who can be placed, rules on pricing and other reimbursable costs, obligations of placement agencies, and what constitutes a violation exposing an agency to financial sanctions. The directives specifically state that the recent contract awards, RFP 2023-8017, are exempted from the new rules. Also, most northern regions are out of scope, meaning that Premier Soin Nordik and Solution Nursing PHA are mostly unaffected. On Aug. 16, 2023, the Quebec Minister of Health declared that he had received comments on the draft directives and set the date of Oct. 3, 2023, as the target for publishing the final set of directives. Answering questions form the Association of Health and Social Services Establishments Managers (AGESSS), the minister also stated that dates included in the directives could be re-evaluated in the future, if necessary, to implement a smooth transition.

PHA will endeavour to work within the proposed framework, as it expects many smaller competitors to fail complying to these new rules. The company believes that its services offer flexibility to both professionals and institutions, and, as such, play a vital role in providing quality health care to the population. According to the Quebec Ministry of Health, the province is spending $1.32-billion annually on health care independent labour provided by placement agencies.

Canadian health care agency

The Ontario agency was acquired in April, 2022, and contributed to the company's results for the full first nine months of 2023. For the period, CHCA contributed around 27 per cent of the consolidated revenues. The integration of CHCA is going as planned with a solid and well-established management team. CHCA is an important service provider to the federal government and is also providing services to provincial entities namely in Manitoba and British Columbia.

Solutions Staffing

On July 4, 2023, PHA announced the signature of a binding share purchase agreement aiming to buy 100 per cent of the shares of Solutions Staffing, a British Columbia health care placement agency. The transaction is proceeding as expected. The closing is subject to customary conditions, the performance of which is continuing, and is expected to close before the end of PHA's fiscal year. This acquisition is a major milestone in terms of geographical diversification of PHA. It also expands the company's base in the travel nurse segment, which, because of longer-term assignments, is simpler to manage. Based on its 2022 fiscal year, Solutions Staffing had revenues of $74.0-million and an EBITDA of $6.7-million. On a pro forma basis, PHA's revenue base outside Quebec will represent 60 per cent of total revenues.

Issuance of deferred shared units (DSUs)

On Aug. 28, 2023, 462,500 DSUs will be issued to PHA's administrators as compensation for services performed in 2023. The price of each unit was set to 80 cents per unit on the award date, which was March 23, 2023. However, the units could not be issued until now because of restrictions linked to blackout periods. This issuance is made from the normal administrators' remuneration plan.

About Premier Health of America Inc.

Premier Health is a leading Canadian health technology company that provides a comprehensive range of outsourced services solutions for health care needs to governments, corporations and individuals. Premier Health uses its proprietary LiPHe platform to lead the health care services sector digital transformation to provide patients with faster, cheaper and more accessible care services.

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