Nova Leap Health achieves a huge revenue “leap” of 877% over the previous year
There is a massive trend happening that has been mostly ignored by investors, and it’s a trend we have known was going to happen 60 years ago. No its not electric vehicles or cannabis. It’s a demographic trend – The ageing population of North America. The chart below shows from 2010 to 2030 we see an acceleration in the percentage of the population aged 65 and above. Or in other words, here in 2019 there are a lot more 75-85 yo’s needing some home care. In fact, approximately 11,000 people in the US are turning age 65 each day.
One of the better ways to play this trend is to invest into the home care and home health care sector. The non-medical home care industry is 6.1% of the $89.2B U.S. home health care market revenue, which is approximately $5.4B.
Nova Leap Health Corp. (TSXV: NLH) is a company focused on the home health care industry and is an international provider of personal home care and support services. Nova Leap acquire, manage and build home care service companies that provide wonderful support to clients and their families at home.
The baby-boomer generation continues to age and want continued independence. Nova Leaps vision in the home care market provides this with in-home care services that are a cost-effective alternative to facility-based nursing home care, and enable at-risk older adults to maintain their independence in their own homes.
2018 revenues grow 877%
On March 14, 2019 Nova Leap released its financial results for Q4 and full year ended December 31, 2018. Results are highly impressive, to say the least.
- 2018 revenues of $10,362,179, an increase of 877% over 2017 revenues of $1,059,845.
- Q4 revenues of $3,801,082, an increase of 32% over Q3 revenues of $2,871,010.
- The Company achieved double digit revenue growth for the sixth consecutive quarter.
- The Company reported Q4 net income of $27,316 as compared to a Q3 net loss of $378,382 and a full year 2018 net loss of $961,271.
- Gross margin increased from 30.6% in the third quarter to 31.7% in the fourth quarter of 2018 while full year 2018 gross margin of 32.0% was reported.
- As the Company has scaled up, Head Office costs as a percentage of revenue decreased from 53% in 2017 to 11% in 2018.
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CEO Chris Dobbin states: “2018 was a year of tremendous growth for our organization. Annualized recurring revenues for 2019 are already tracking 50% ahead of reported revenues for last year so we expect this year to be another excellent year for shareholders.”
On February 21, 2019 the Company announced it has achieved the number 10 ranking in the 2019 TSX Venture in the Clean Technology & Life Sciences sector. This is the Exchange’s annual ranking of Canada’s top 50 emerging publicly traded companies.
Acquisitions continue in 2019
The good news on Nova Leap continued for the Company as on February 27, 2019 they announced that they executed a non-binding Letter of Intent to acquire a home care services company with reported un-audited revenues of approximately $1.82 million, located in Eastern Canada. Upon closing of the acquisition, which is targeted towards the end of April 2019, Nova Leap’s annualized recurring revenue is expected to increase by approximately 11%.
Chris Dobbin, Nova Leap, CEO stated: “We are looking forward to working with this well-established agency. We remain committed to our expansion plans in the U.S. and Canada and continue to be attracted to management teams who share our mission in home care”.
Nova Leap’s 9 operation locations
Nova Leap is focused on a highly fragmented market of small privately-held companies that provide patients one on one home care. The Company’s post acquisition strategy is to increase annual revenue per location. The Company now holds eight locations in the New England states of the USA and one in Nova Scotia, Canada.
The Home Care Providers industry is becoming one of the fastest growing healthcare industries in Canada and the United States. Nova Leap could be in the right place at the right time with a growing market of clients. With a huge revenue “leap” of 877% over the previous year they are certainly living up to their name.
Nova Leap Health Corp. is based in Halifax, Nova Scotia, Canada; and has a market cap of CAD 18m.
Matthew Bohlsen holds a Graduate Diploma in Applied Finance and Investment (similar to CFA), and a Graduate Diploma in Financial Planning. He has 30 years ... <Read more about Matthew Bohlsen>