Thank you for standing by. This is the conference operator. We would like to welcome you to the Skylight Health conference call to discuss the acquisition of NeighborMD. As a reminder, all participants are in listen-only mode, and the call is being recorded today, Tuesday, May 2nd, 2022, at 10 A.M. Eastern Time. The recording will be posted to the Skylight Health's website within 24 hours of the conclusion of the call. As always, I would like to remind you that listeners are cautioned that today's call may contain forward-looking statements, including certain statements which concern long-term earnings objectives. These should be considered with the cautionary statement contained in the Skylight Health earnings release and in the company's MD&A and other filings. Forward-looking statements are subject to risks and uncertainties and assumptions. Accordingly, actual performance could differ materially, and undue reliance should not be placed on such statements. Skylight Health does not undertake to update any forward-looking statements except as required. All currencies discussed on this call will be in Canadian dollars unless otherwise specified. I would now like to turn the meeting over to Skylight Health's Chief Executive Officer, Mr. Pradyum Sekar. Please go ahead. Thank you, Daylene. I have to apologize for the listeners on this call. There's gonna be some road noise. Our teams are here in Florida, and unfortunately, we just got caught right in a rainstorm at the start of this call. We should be parked here shortly. Hopefully this will be less of a distraction. Good morning to everybody, and thank you all for joining the call today. My name is Pradyum Sekar, Co-founder and CEO of Skylight Health Group. This morning we announced a very exciting piece of news, highly transformative for the company. The company entered into a definitive agreement for the acquisition of NeighborMD, which is a primary care group in Florida with nine practices across Central and Southern Florida. This acquisition also comes alongside arranging a $20 million U.S. credit line facility that some of those funds will be used to fund. We'll talk about a little bit more of that on this call, and that will be closing concurrently alongside with the closing of the acquisition. Just reminding again a definitive agreement, so certainly not an LOI and a deal that we expect to be closing imminently, as we go through the final motions of approvals, as required. What I'll do on this call is for the callers, I'd like to first start out by describing NeighborMD, the organization. I'd like to talk a little bit about what the deal represents for us at Skylight and ultimately for all of you, and then ultimately sort of talk about the terms of the transaction and what's next. Before I start off, just highlighting Skylight Health, we're a primary care healthcare organization focused in the U.S. markets. Our business model is focused on two segments. One is on the consolidation and growth of independent primary care practices that operate in a fee-for-service environment primarily. The second business model is on the transition of those practices into risk and value-based care, where these practices can benefit from increased reimbursements either on a shared savings or capitated basis from healthcare payers. That capital allows us, as a primary care organization, to really put capital to the patient's needs and where the patient's outcomes can be better improved. Skylight Health has been driving towards value-based care as part of its business model now for quite some time. As we've made several acquisitions in the space, we're very excited on the back of the Centene, CHS announcement, joint venture agreement that we announced recently, that we really have been putting the pillars for us to be able to successfully participate and perform in value-based care. The closing acquisition here of NeighborMD really represents our true first step into value-based care contracting, and I'll get into it here, now. NeighborMD, like I mentioned, they are a Florida-based primary care group. They have nine practices, roughly evenly split between Central and Southern Florida. It's a group that's been performing primarily in the Medicare Advantage and Medicare Advantage risk space, although they do have a fee-for-service commercial business line as well. NeighborMD has been operating with a strong leadership team that has been performing well against these Medicare Advantage risk contracts. Currently, their risk contracts are with two payers. One's a national payer, Humana, and the other one is state-related payer, CarePlus. The lives at risk in NeighborMD today represent roughly around 2,400 total Medicare Advantage lives, and those lives are about evenly split between their own practices and their affiliate practices. What we really find attractive with NeighborMD is obviously their experience and what they've been able to do successfully with these contracts in overall improving patient outcomes, keeping the cost of care down, and ultimately performing well against these contracts. That these contracts reimburse for these Medicare Advantage lives on a capitated basis annually, approximately $10,000-$12,000 per Medicare Advantage life per year. As we've previously described, traditional fee-for-service Medicare and Medicare Advantage reimbursements are usually in the $200-$400 per patient per year. The significant increase in revenue allows for NeighborMD as an organization to really put the capital to use where the patient can be best treated and prevented from any further increases, both in cost of care and acuity of conditions. The NeighborMD acquisition also has alongside with it the opportunity to expand those contracts with Skylight Health. We'll get into those synergies shortly. We're very excited to welcome the NeighborMD team. We look to close imminently, and our teams are already here in Florida on the ground, including myself, as we work with both our JV partners, CHS and Centene, as well as with the NeighborMD team to start onboarding and strategizing growth plans. As I talk about sort of what the relevance of this transaction can be for Skylight, why we are so excited about it, and ultimately why we hope you will all be so excited about it, is let me get into the synergies of the deal. Number one. NeighborMD effectively accelerates Skylight Health participation into global risk by a few years. As we've communicated earlier, our plan was to always transition into full risk, although it is a journey that typically, in our minds, could take three to five years organically. By expediting that through the acquisition of NeighborMD, we enter into full risk this year, thereby exposing our capabilities in the full risk space within the state of Florida and what we can expand within our other states, leveraging the relationships and experience that NeighborMD's been able to achieve here within the state. By accelerating our time into full risk, that obviously means that we could see beneficially increased overall revenues and profitability contribution from these deals. With our existing practices in the state of Florida, we intend to very quickly work with these healthcare payers to expand access for Medicare Advantage risk lives for both Humana and CarePlus in Jacksonville within our existing practices. We have a very fast-growing Medicare population within that region that I believe will benefit greatly from these health plans. We also expect to start to leverage these contacts and relationships across our other two key states, both Pennsylvania and Colorado, as we start to look at the opportunity to start taking on risk with both of these relationships here in Florida. Vice versa, we also believe that NeighborMD will be able to benefit greatly from the operational infrastructure that we have within Skylight Health. Our ability to manage and operate fee-for-service practices will benefit NeighborMD's growth in the fee-for-service space. Of course, they have a number of contracts and patients that have an opportunity for growth, and we're excited for what our contracts in Florida will be able to benefit them, but also what our teams will be able to synergistically help grow, their organization. Finally, just let me highlight quickly what the terms of the transaction are and sort of timing of the transaction. For the acquisition of NeighborMD, we intend, again, to close here very shortly. We've been doing diligence under LOI now for quite some time, and we're looking to just get the final checkoffs here in order to close. The transaction size is $8 million, which will be cash paid on closing. In order to fund the acquisition, and again, to be mindful of current market conditions, we have worked to arrange a $20 million U.S. credit line facility with a lender based out of New York, upon which we will be drawing down an initial $10 million to close the acquisition and have some additional working capital on hand, and we will still have sufficient capital remaining within the line of credit to be able to utilize against future acquisitions. We'll be able to share more on the terms of the deal, but we're looking at roughly around a three-year note where the company has the ability to repay or prepay any part or in full the debt without any premiums or penalties. Again, we'll be looking to leverage our relationships with this lender to be able to continue to have an additional source of capital to be able to support our growth intent and that we're able to now show to the market that we're also able to leverage debt in order to make acquisitions and not just equity alone. We're very excited to have a partner in New York here to support our acquisition growth initiatives, and we look forward to the ability to be able to continue to build on that relationship. With that, I'd like to turn it over to some questions. Now, based on the nature of this call, we haven't been able to necessarily open it up for live questions. We have a few analysts that have submitted questions to us. What I'd like to do is to read those questions out loud, with the analyst who's asked them and do my best here to address them on this call. If there's any other questions that come up here, please, just a reminder that you can always email us at investors@skylighthealthgroup.com, and we'll try and consolidate a response, if not have a follow-up call to be able to address questions in a more streamlined manner. I'll start off with the first question. This comes from Rob Goff from Echelon. Rob's question is, could you please describe or discuss the individual patient economics inside value-based care, and outside, which is effectively the $300-$400 in billing that goes to $10,000-$12,000 and associated margins of 10%-15% versus 6%-8%? Then effectively to that, how would this impact your existing Florida clinics, and how does it impact acquisition economics? To answer that question, as I mentioned, traditional Medicare, traditional fee-for-service Medicare Advantage, what we usually see from our fee-for-service practices is an average revenue, based on, you know, an average visit of three to four times a year, somewhere between $300-$400 a year per Medicare or Medicare Advantage patient. When you move to a fully capitated model and full risk, keep in mind you're taking on both the upside and downside of that patient's healthcare cost globally. The reimbursement rates are significantly higher. What we see now under those risk contracts with both Humana and CarePlus is an average of about $10,000-$12,000 in reimbursement per year. Typically, when we look at these types of contracts in a fee-for-service business, a 10%-15% EBITDA margin would be a healthy margin to attain. When we look at a Medicare Advantage risk contract, we usually see our peers at somewhere between 6%-8%. When you think about the economics from a contribution standpoint, of course, profitability contribution from a 10%-15% on a $200-$400 a year patient versus a 6%-8% on a $10,000-$12,000 a year patient, there's significantly more bottom line contribution in the Medicare Advantage risk space. Of course, you wanna make sure that you have the right infrastructure, which again, we believe that NeighborMD has both the experience and has performed well against. As we look to expand on Medicare Advantage risk, we certainly see the ability for us to grow the bottom line from being able to have increased contribution from these contracts, and that'll certainly be one of our focuses here post-acquisition with the NeighborMD team. To that question on how does it impact our other practices in Florida, again, we believe strongly that these contracts will be able to expand. We've already had the conversations prior to signing of the definitive agreements that these plans could be expanded to our Northern Florida practices. We'll be working quickly here to expand it there. Currently, you know, we have anywhere from a number of Medicare lives that could benefit here greatly from these agreements and contracts, and so we'll be working quickly to be able to transition those patients into these agreements where they'll see improved economics, so from their perspective, but also increase health outcomes from the ability for us to control that cost of care for them better. As we look at future acquisitions, now, of course, this changes the landscape on how we value these acquisitions. We were always gonna value them based on risk, but when you think about valuing them three to five y ears out, we're still gonna maintain our focus on fee-for-service acquisitions that show a positive EBITDA and profitability. Of course, now what we can do is look at their Medicare lives today that could go under risk, especially now that we have these contracts in Florida, and start to be able to generate the ability for us to create a much stronger organic growth path for the practice post-acquisition, creating improved economics and patient care for the practice as well. We're certainly excited, and given that we have a fair number of deal flow within the state of Florida and now an acquisition line of credit to support those acquisitions, we will be keeping in mind spending a fair bit of time integrating when we've acquired an asset that's effectively double, you know, looking to more than double our annual revenue run rates. More importantly, we're also looking at an acquisition here that will be adding significant growth capacity to the business. We're gonna be making sure that we spend a fair bit of time here integrating NeighborMD successfully and integrating Skylight successfully into their organization so that we can benefit the most from each other's positive attributes. On the back of that, we'll continue to look at deal flow within the state of Florida strategically and look to identify ways to continue to grow where now we can benefit from these improved plans that come on board. The second question comes from Rahul Sarugaser from Raymond James. His first question is, while this acquisition more than doubles our top-line revenue, we know that it's different from our playbook in two ways. One is that it's an EBITDA negative while we typically focus on EBITDA positive. Two, that they have a base of Medicare patients, while we typically focus on non-Medicare, Medicaid at a discount and convert them. I think part of the question here is why we believe NMD is still a good acquisition given that it's not the typical footprint and what we normally acquire. Also some details on why we're so confident we'll be able to turn them into an EBITDA positive contribution company. I think the answer to that is twofold. The first one is correct. We typically don't focus on practices that have a Medicare Advantage risk population because part of our value is bringing this post-acquisition. Now, however, given the unit economics of this transaction and the discount that's applied to the transaction, it really benefits us to be able to accelerate effectively the contracts and the experience that would have organically taken us a few years. Now, with the foundation in place, we can move more aggressively with traditional fee-for-service practices and keep our focus on those practices going forward. We still have not strayed from our focus, but we believe this acquisition is instrumental in helping us drive forward in our vision and what we've sort of committed to as an organization looking to build in the primary care space. From an EBITDA perspective, yes, while NeighborMD has not yet been profitable, we have to keep in mind EBITDA in this organization was largely attributed to what I would consider to be an organization that had a significant amount of debt from previous institutional ownership, as well as the fact that they had a significant corporate overhead to support a much larger enterprise. What we have seen with the NeighborMD itself, though, is that it's a very high-quality asset with significant opportunity for upside and a team that's dedicated to growth. What we're looking forward to is an opportunity where we can certainly see a lot of synergies and cost synergies, but also revenue synergies, effectively make an impact to the positive for NeighborMD and Skylight collectively. We have already identified a lot of that prior to signing the definitive, and we've already started to execute that as we are now on the ground. We're confident that our experience in running these practices, combined with their experience in risk, we'll be able to turn this to a break-even and greater by the end of this year. We are working aggressively towards that goal. We believe that revenue growth for NeighborMD and cost synergies are very much near term. Certainly NeighborMD has a lot they can benefit from Skylight Health's perspective of fee-for-service contracts and attributes within the fee-for-service space. They also have a lot we could potentially benefit from in terms of their own patient population. As we look at risk and how these patients are currently coded with healthcare payers, the ability for us to leverage now our relationship with CHS and Centene, and really being able to understand these patients, improve the coding on these patients, and ultimately see improved revenues on a capitated rate is certainly one of the areas of focus and strategy that we'll be working on with our new joint venture partners. To move on to the next question, from Frank Takkinen from Lake Street. How many lives do you have in Florida geographies now that are in the same counties as NeighborMD? How many are MA eligible? I'll start with that one first and then three more subsequent questions. Currently our Florida practices are effectively now split north, central, and southern. Northern in the Jacksonville region, central in the Orlando region, and southern in the Miami region. They're all sort of equally split between four to six practices. Collectively together, we have an expanding density across the state quite well. The contracts that are applicable for NeighborMD are applicable in the counties of Northern Florida as well. We certainly have the ability to leverage the option to go back and expand those contracts into those states, which will be our focus. In terms of patients that are MA eligible, today within the Jacksonville region, we have anywhere between 800 or so Medicare patients today, and that's a fast-growing number that again, we believe, we can continue to attribute as we continue to grow. We are putting more of a focus on quality, but certainly a healthy population now that we believe we can start to expand Medicare Advantage products too, that where patients could certainly benefit given patient populations that can benefit from the type of care that comes with these Medicare Advantage risk contracts. That again comes on the back of other potential acquisitions that are within these regions as well that have a healthy Medicare Advantage population. In terms of integration timeline, you know, like always, we typically try and integrate as quickly as possible. Recognizing that change management integration takes time, we will be spending our time to do the integration successfully. From a timeline perspective, we won't necessarily need to have a halt on any other activity, but at the same time, we will be taking our steps, simultaneously to be able to make sure that what we're buying is as solid and stable as possible and will continue to grow. That is the most important point for us, you know, what we're acquiring today shouldn't stand still, but how do we drive organic growth? How do we drive synergistic growth? That will be a focus for us during the integration period and beyond as well. Again, we believe that we have a solid foundation at Skylight over the last six months through the integration expenses and activities that have been put in place to be able to now take on NeighborMD within our network. Then the last question from Frank was, can you explain how the CHS JV complements the acquisition? CHS Centene, of course, Centene being one of the top five payers in the U.S., roughly about a $50 billion market cap, and CHS being the office in Centene that helps to manage risk contracts, they will be imperative and instrumental in helping us not just execute against the risk contracts, although NeighborMD has a solid team that's been doing it, but also in being able to grow the number of risk contracts that we have within the space. As part of our trip to Florida, we already have an ongoing strategy session with the group this week. This will be one of the primary focuses in terms of NeighborMD, what it's able to bring to the table, introduction to the team, delegation responsibilities, and working with Centene to identify opportunities over the next 12, 24, 36 months, where we can now start to really drive Medicare Advantage growth within the state of Florida, but also how we can now leverage these against our other states as well. We're certainly looking forward to the impact of our JV partnership, and the positivity that comes on the back of now aligning both competencies and capabilities along with contracts in a state where we have an active growing population. We're certainly very excited organically for where this can lead to. With that, I think. Actually, there's one more question. I think one more question from Carl Byrnes from Northland. Outside of NeighborMD, what does the acquisition pipeline look like? As always, we committed to having a bullish pipeline. There's a number of deals in the deal pipeline. Of course, there's a number of impacts that go into that. One is strategy. We're much more selective now in terms of who we're looking to acquire based on where we think we need to build the most density, where we think we have the highest rate of growth from a contract and patient population perspective, the price, and of course, market conditions and our capability of wanting to close a deal based on current market conditions. Now having access to an acquisition line, that certainly gives us an alternative option here to move. We will be looking at acquisitions. I do wanna caution all shareholders that, of course, while we continue to be an M&A-focused company, we are also an integration and operational company, and we'll be putting our focus on both operations as well as acquisitions. We'll have a steady cadence of growth both organically as well as from acquisitions going forward. The impact of these Medicare Advantage contracts on our existing business, again, we believe will be material, and that is not something that we're gonna wanna sit lightly on. We'll be moving pretty aggressively on that space as well. With that, I'd like to potentially close the call off from our side. I wanna thank each and all of you for joining the call today. Again, this is a very exciting piece of news for us as an organization. Please stay tuned. We will be putting out a press release once we close the deal here imminently. Of course, again, until that point in time, we've already begun integrating in with the organization and starting to really look at how these synergies now can be built upon. Again, with that, thank you all for your continued support, and we look forward to keeping you updated. Daylene, I can turn the call back to you. Thank you. This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.