Nova Leap Well being Company is actively pursuing merger and acquisition alternatives. That's one of many key takeaways from a public letter the corporate's CEO and president, Chris Dobbin, not too long ago wrote to shareholders.

Nova Leap is a Canadian-based residence care group that has grown within the US. The corporate has places of work in Nova Scotia and 11 completely different US states.

Nova Leap's aggressive strategy to mergers and acquisitions ought to come as no shock to those that have been watching carefully. The corporate even managed to shut three offers in several markets over the course of three consecutive Fridays in 2021.

Within the letter, Nova Leap cited “acquisitions” as one of many key areas the place the corporate plans to allocate capital this 12 months.

“Nova Leap has created borrowing capability by way of the reimbursement of all long-term financial institution debt,” Dobbin wrote. “Administration plans to make the most of a few of this capability for mergers and acquisitions, along with money circulate era, the place applicable.”

Along with mergers and acquisitions, investing in its present residence care enterprise is one other space the place Nova Leap plans to allocate capital in 2024.

“Our objective is to extend gross sales and repair hours at current residence care places by hiring skilled gross sales workers who can deliver on new clients to enhance current operations groups,” Dobbin wrote.

As well as, Nova Leap plans to well timed repay $117,000 in promissory notes left over from earlier acquisitions.

The corporate additionally used the letter to stipulate what it believes are the highlights of 2023.

The corporate achieved a document annual consolidated adjusted EBITDA of $1,477 million. This exceeded the final three years mixed and was a rise of 124% in comparison with 2022 outcomes.

Nova Leap additionally thought-about the early reimbursement of all long-term financial institution debt in the course of the 12 months as a spotlight.

As well as, Nova Leap's accounts receivable ratio was 99.7%. Final 12 months's attain was 99.7%-99.9% between 2020 and 2022.

Nova Leap additionally noticed insider possession develop. In the course of the fourth quarter, insider possession elevated to 40.61%. Insider possession stood at 38.9% on the finish of 2022 and 36.2% on the finish of 2021.

Then again, Nova Leap has additionally skilled challenges.

“Merely put, our greatest problem in 2023 was income development,” Dobbin wrote. “We noticed vital efficiency in key monetary classes equivalent to gross margin proportion, adjusted EBITDA, money flows, working earnings and debt discount, however revenues fell beneath expectations. It’s a focus in 2024.”

One of many causes income development is a ache level for Nova Leap is the character of residence care.

“On a person foundation, our residence well being businesses would all be thought-about small companies,” Dobbin wrote. “On the native stage, service hours are decided by a recurring income mannequin, the place suppliers are typically scheduled to serve purchasers on the identical schedule every week for so long as they require care. These small companies are significantly affected by buying or shedding clients who require excessive service hours.”

Finally, Dobbin believes the corporate's plan to rent skilled gross sales personnel will impression Nova Leap's outcomes over time.

“Once we examined our assortment of businesses, we discovered that pure consumer attrition was offset by businesses with profitable gross sales workers who had been in a position to market our companies to a broader base of referral sources than businesses with out a gross sales function.” He wrote.