Good afternoon, ladies and gentlemen, and welcome to the Neighbourly Acquisition Conference Call. At this time, all lines are in a listen-only mode. If at any time during this call you require immediate assistance, please press star zero for the operator. Also note that the call is being recorded on Thursday, March 10th, 2022. I would like to turn the conference over to Chris Gardner, CEO. Please go ahead, sir. Thank you, operator, and good afternoon, everyone. I'm Chris Gardner, Neighbourly's Chief Executive Officer. I'm joined this afternoon by Terri Smyth, our Chief Financial Officer. We're very pleased to speak to you and to provide a brief overview of Neighbourly's agreement to acquire Rubicon Pharmacies, Western Canada's largest owner and operator of independent pharmacies. It is not an understatement to describe this CAD 435 million acquisition, which will increase our number of locations by nearly 60% as a transformational moment of our business. Before we begin, however, I'd like to note that some of our comments will contain forward-looking information and statements under applicable securities laws that reflect management's current views with respect to future events. Any such information and statements are subject to risks, uncertainties and assumptions and could cause actual results to differ materially from those projected in the forward-looking information and statements. Please refer to the various materials Neighbourly has filed with Canadian securities regulators for a broader description of operational and risk factors that could affect the company's performance. I also wanna note that during our commentary, we will reference several non-IFRS financial measures. Although we believe these measures provide useful insight into our performance, they do not have standardized meanings and should be considered as a supplement to, rather than a substitute for IFRS financial measures. Reconciliations between the two can be found in our regulatory documents, which are available on our website, which is www.neighbourlypharmacy.ca. Finally, I want to note that listeners may visit our website and find the presentation outlining this transaction, its financial details, and any other matters that we'll discuss today. I'd like to begin today's call by providing a summary of Rubicon's business, our rationale for the transaction, and some of our integration objectives following the acquisition's completion. Terri will then discuss some of the transaction's financial details, as well as two associated fundraising items which will facilitate this transaction's financing. Rubicon is a leading pharmacy network in Western Canada, and we are excited and thrilled, quite frankly, to be able to acquire such a solid business that's built on an incredible reputation about putting patients first and has been thoughtfully built over many years by a strong management team and, more importantly, strong pharmacists and strong pharmacy operators and over 1,500 colleagues. It's an amazing platform and a very complementary platform that supplements our existing business in Western Canada. Neighbourly has always been incredibly strong in both BC and Alberta and Ontario, and we've had a lighter footprint, I would say, in the prairie provinces, specifically Manitoba and Saskatchewan. The combination of Rubicon and Neighbourly together really solidifies our position as a leading pharmacy operator across Canada and strengthens our position in a significant way in Western Canada. This is truly a transformative acquisition and an exciting acquisition for us as a business. Neighbourly's network is very similar to Rubicon's. Very complementary in many ways. Rubicon has focused primarily on rural communities and smaller underserviced communities, as well as health centers, medical buildings and clinics, and are often viewed as the center of healthcare. Very similar format and operations as Neighbourly. They also operate in very similar banner programs and franchise programs and is a very complementary overlay to our existing business. The business as a whole generates over CAD 300 million in annualized revenues, and that's very complementary and will be immediately synergistic to our business. It generates CAD 39 million of adjusted EBITDA, you know, has an EBITDA rate of about 13% on an adjusted basis and fills about 6.1 million prescriptions across Canada. It is the largest independent operator next to Neighbourly, and it is a very complementary business to be able to join with Neighbourly. It really, there's a lot of strategic rationale around, you know, why we've chosen to acquire Rubicon. They've got a strong team, a strong operations team, strong support structure, and incredible locations right across Western Canada that are really focused on healthcare and providing the best in community care. They operate in very similar communities. They are a key platform in Western Canada and specifically Saskatchewan and Manitoba, where Neighbourly has typically underpenetrated compared to other markets. There is significant potential synergies with upside through the implementation of Neighbourly's operational best practices and the combination of both companies. It's gonna have mid-teens accretion to the earnings per share based on our full year 2023 fiscal contribution. It really cements Neighbourly's position as the fastest and largest growing of independent community network of community independent pharmacies across Canada. We're thrilled to have the opportunity to work with the leadership team, Terri, Rob, Keith and Dwayne, and the pharmacy teams and the pharmacy operators and pharmacists and collective support teams right across Western Canada to be able to really join what are two leading independent pharmacy retailers into a significant pharmacy network right across Canada. It's a very complementary footprint. Combined, we will have over 271 locations. It's hard to believe that Neighbourly started with a single location in 2015, and we've very quickly grown with quality pharmacies right across Canada. With this transformative acquisition, adding in another 100 locations, it increases our pro forma revenue by 62%, our pro forma adjusted EBITDA by 70%, and almost a 60% increase in outlets and locations right across Canada. If you look at the map, you can see how complementary it is. Again, as I mentioned earlier in the call, Neighbourly has a strong footprint in Western Canada, in B.C. and Alberta. We had a relatively light footprint in Saskatchewan and Manitoba and a very strong footprint in Southern Ontario. This really infills the prairies in the western provinces and really improves Neighbourly's positioning as a national pharmacy operator and a leading pharmacy operator with soon-to-be 271 locations. We're very excited about the growth potential and the incredibly complementary nature of this acquisition. I'm gonna turn it over to Terri, who's gonna talk a little bit about, you know, how this acquisition really accelerates our scale and the growth of our organization. Great. Thank you, Chris. As Chris just mentioned, during the twelve-month period ended September thirtieth last year for Rubicon, they generated approximately CAD 303 million of revenue and CAD 39 million of adjusted EBITDA, which is before any synergies. Upon closing of this acquisition, it is expected to increase Neighbourly's pro forma revenue by approximately 62% to CAD 791 million. Pro forma adjusted EBITDA will increase by approximately 70% to CAD 100 million, which includes an estimated CAD 2.5 million of synergies, and with a pro forma adjusted EBITDA margin of approximately 12.6%. Furthermore, as Chris also mentioned, we expect this acquisition to be mid-teens accretive to our EPS based on fiscal 2023 full year contribution. As I just mentioned, with this increased scale, we have identified approximately CAD 2.5 million of near-term cost synergy opportunities. These opportunities will include improvement in commercial and purchasing terms through increased purchasing power, along with real estate and administrative optimization. We do expect to realize approximately three-quarters of this synergy opportunity within the first 30 days and the balance of it over the course of the following 90 days post-closing of the transaction. The total cash consideration for this acquisition is CAD 435 million, which is subject to the customary post-closing adjustments and right of first refusal. The purchase price represents pre-synergies multiple of approximately 12x Rubicon's adjusted EBITDA for the trailing twelve-month period ended September 30, 2021. However, the effect of multiple will be lower after giving effect to several items, including potential real estate dispositions, tax assets, and synergies. In order to finance this acquisition, we intend to complete a CAD 250 million equity issuance of subscription receipts. CAD 120 million of these will be purchased on a private placement basis by Persistence Capital Partners, Neighbourly's largest shareholder, while the remaining CAD 130 million will be distributed by way of public offering. The balance of the purchase price will be financed through drawdowns on our restated credit facilities and cash on hand. This financing structure provides for prudent capital structure with leverage of approximately 3x at close, with a clear path to deleveraging post-acquisition, and also significant incremental financing capacity and free cash flow to continue to execute on our strategy of growth through future acquisition opportunities. Our long-term leverage target does remain at 2.5x. The acquisition is expected to close in our first fiscal quarter of 2023, again, subject to customary closing conditions, regulatory approvals, third-party consents, et cetera. I'll pass the call back to Chris to closing remarks. That's great. Thank you, Terri. I'd like to take a second to just acknowledge that the multiple we're paying here is greater than those associated with our past transactions. We do feel that this is more than justified given the scale, you know, of this opportunity and the strategic advantages that it offers us. Upon completion of this acquisition, Neighbourly will have added over 140 locations to our network over the past four quarters, nearly doubling its size. We are very pleased with how we have executed upon our stated strategy of growth by acquisition. Despite both this growth and the magnitude of today's acquisition, Canada continues to offer up a wealth of high-quality acquisition opportunities. We will continue to pursue the most promising of these opportunities and believe we can do so at a level consistent with our historical pricing. I'd also like to conclude by expressing a very warm welcome to Rubicon's 1,500 team members. Neighbourly's selfless, dedicated, and talented pharmacy teams are our most valuable asset, and we sincerely look forward to welcoming you to our family. With over 2,000 employees today and 1,500 employees joining it from Rubicon, we'll have a combined 3,500 employees across our network, coast to coast. Thank you for those of you who've joined us midway this afternoon. I'd encourage you to revisit our remarks at the beginning of the call related to forward-looking information. A replay of the call and accompanying presentation will be available via our website, www.neighbourlypharmacy.ca. Thanks again for joining us today and hearing a bit about this transformative acquisition. Thank you, operator. Thank you, sir. Ladies and gentlemen, this does conclude your conference call for today. Once again, thank you for attending. At this time, we do ask that you please disconnect your lines.
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