Premier Health of America Inc V.PHA

Q3 2024 results

[colourama]

Bottom line numbers are disappointing but not unexpected. I think you really have to dig through the MD&A to get important colour on the financials as opposed to just reading the basic news release.

This just requires (a lot of) patience. I do believe that the situation in Quebec will improve when the government realizes that they are absolutely tanking the healthcare system. Otherwise, they can even forget about Quebec and lean on the operational strength of SSI to carry them forward.

SSI is performing very well: "SSI has demonstrated a solid performance, generating $67.3M in revenue with a gross margin of $8.3M and an EBITDA of $5M." Keep in mind that is through 6 months and 52 days.

From the MD&A:

"Provincial governments policies are resulting in drastic operational measures, including temporary closing of departments and hospital floors, postponement of non-critical medical procedures, and limited emergencies operating hours, with the expectative of weaning the provincial healthcare system from non-permanent employees to implement the single employer model."

"The per diem units are active mainly in urban centers in the province of Quebec where the provincial government has, in our opinion, wrongly targeted staffing agencies as the source of all the province health care system issues."

[CauseWhyNot]

My expectations were low. But I still had more hope then this.  Quebec government will not let up.. in a year and a half they want 0 outsourcing. It's going to be hard for them to manage their ebitda/ NI. 

[colourama]

I'm going to go out on a limb and blankly state that there is 0 chance the Quebec government can achieve 0 outsourcing and not crater their provincial healthcare system. Where are they going to get all the nurses from? Regarding EBITDA, SSI alone seems like it should bring in around $10 million/year EBITDA. If PHA cannot sustain profitable operations in urban Quebec, then perhaps they can