– Company Repays $10 Million of Revolving Facility; Remainder of Net Proceeds to be Used to Further Reduce Debt and Restore EBITDA Through Accretive Acquisitions –
TORONTO, Sept. 2, 2014 /CNW/ - Centric Health Corporation ("Centric Health") (TSX: CHH), Canada's leading diversified healthcare company, today confirmed it has completed the previously announced sale of its methadone pharmacy operations, referred to as the DNPI Group ("DNPI"), to a Canadian consortium of healthcare investors, for gross proceeds of $20 million. The Company also announced that it has used a portion of the net proceeds from the transaction to repay $10 million of its Revolving Facility, permanently reducing the capacity of the Facility to $40 million from $50 million.
"Net proceeds from this sale allow us to take meaningful steps forward in our debt reduction strategy," said David Cutler, President and Chief Executive Officer, Centric Health Corporation. "Equally important, the net proceeds will provide the capital to re-invest in high margin businesses aligned with our core operations to restore and grow EBITDA beyond previous levels."
The Company expects the remainder of the net proceeds from the DNPI divestiture, and anticipated net proceeds from the previously announced pending retail home medical operations divestiture, not applied to debt will be reinvested in growth opportunities, including accretive acquisitions that will contribute to increased EBITDA and free cash flow from operations. Acquisitions are expected to be consistent with the Company's focus on core business segments and operations that generate high margins and strong cash flow, require low capital expenditures and have low exposure to regulatory or public funding changes.
Centric Health's Specialty Pharmacy segment will now consist primarily of its seniors pharmacy operations, which provide medication dispensing and consulting services to 270 long-term care and retirement homes with more than 21,000 patients in Ontario through five distribution centres.
About Centric Health
Centric Health is Canada's largest and most comprehensive national provider of healthcare services focused on producing leading patient outcomes and delivering quality, innovation and sustainable value to patients, clients and stakeholders. With more than 2,800 dedicated healthcare professionals, consultants and support staff serving patients and clients through an extensive platform of 600 locations across the country, Centric Health is uniquely positioned to meet growing healthcare needs in key markets. The Company's long-term strategy focuses on organically growing core high-margin business units with strong profitability and targeting select expansion opportunities to further its national reach in the areas of physiotherapy, rehabilitation and assessments, specialty pharmacy services and surgical and medical centres. Centric Health is listed on the TSX under the symbol CHH. For further information, please visit www.centrichealth.ca.
This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Centric Health and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits Centric Health will derive there-from.
SOURCE: Centric Health Corporation
For further information: Daniel Gagnon, Chief Financial Officer, Centric Health, 416-619-9417, firstname.lastname@example.org; Lawrence Chamberlain, Investor Relations, TMX Equicom, 416-815-0700 ext. 257, email@example.com