What changed in this filing

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Item 1. Financial Statements

2024-08-07 compared with 2024-05-06 · 219 added, 166 removed, 559 unchanged (41% of the section changed)

4 unchanged sentences

Dollars, except outstanding shares)

March 31, 2024 At

June 30, 2024 At

December 31, 2023

3 unchanged sentences

Accounts receivable, net 2 27,063 18,451

2 24,477 18,451

Inventory 2 4,424 4,628

Income tax receivable

Prepaid expenses and other assets 4,235 2,449

8 unchanged sentences

Identifiable intangibles, net 912 567

3 29,765 29,765

Goodwill 3 32,989 29,765

Other long-term assets 9 — 887

6 unchanged sentences

Accrued liabilities 5 16,801 17,578

14,057 17,578

Finance lease liabilities, current portion 111 256

7 unchanged sentences

Long-term debt 5

5 5,906 6,002

Total long-term liabilities $ 11,289 $ 8,876

4 unchanged sentences

unlimited authorized;

38,816,766 and 38,506,161 issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

38,825,799 and 38,506,161 issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

8 $ 21,910 $ 18,702

1 unchanged sentence

Retained earnings 81,594 79,495

TOTAL VIEMED HEALTHCARE, INC.'S SHAREHOLDERS' EQUITY

$ 119,371 $ 113,895

Noncontrolling interest in subsidiary

TOTAL SHAREHOLDERS' EQUITY

121,180 113,895

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$ 163,947 $ 154,895

See accompanying notes to the condensed consolidated financial statements

VIEMED HEALTHCARE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Expressed in thousands of U.S.

Dollars, except share and per share amounts)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Note 2024 2023 2024 2023

7 unchanged sentences

Depreciation and amortization

377 298 792 538

Loss (gain) on disposal of property and equipment

Other income, net

( 545 ) 117 ( 332 ) 95

Other expense (income), net

563 ( 2 ) 537 ( 83 )

Income from operations $ 3,616 $ 2,901 $ 5,820 $ 4,835

Non-operating income and expenses

Income from equity method investments ( 67 ) ( 35 )

Interest expense (income), net

Income (expense) from investments

( 1,117 ) 137 ( 1,050 ) 172

Interest income (expense), net

6 ( 254 ) 20 ( 404 ) 69

Net income before taxes 2,245 3,058 4,366 5,076

1 unchanged sentence

Net income $ 1,477 $ 2,330 $ 3,080 $ 3,847

Other comprehensive income $ — $ —

Comprehensive income $ 1,603 $ 1,517

Net income per share

$ 0.04 $ 0.04

Net income attributable to noncontrolling interest

Net income attributable to Viemed Healthcare, Inc.

$ 1,468 $ 2,330 $ 3,071 $ 3,847

Net income per share

Basic 11 $ 0.04 $ 0.06 $ 0.08 $ 0.10

Diluted 11 $ 0.04 $ 0.06 $ 0.08 $ 0.10

Weighted average number of common shares outstanding:

38,717,123 38,156,777

40,580,634 40,016,693

Basic 11 38,822,980 38,324,249 38,558,479 38,240,902

Diluted 11 40,553,449 40,676,951 40,313,042 40,383,616

See accompanying notes to the condensed consolidated financial statements

3 unchanged sentences

Dollars, except share and per share amounts)

Common Stock Additional paid-in capital Total Shareholders'

Common Stock Additional paid-in capital Noncontrolling interest in subsidiary

Total Shareholders'

Shares Amount Retained

2 unchanged sentences

Stock-based compensation - restricted stock

— — 1043 — — 1,043

Exercise of options 108,370 544 — — — 544

3 unchanged sentences

Shareholders' equity, March 31, 2023 38,276,389 $ 17,096 $ 12,087 $ 70,858 $ — $ 100,041

Common Stock Additional paid-in capital Total Shareholders'

Stock-based compensation - options — — 301 — — 301

Share-based compensation - restricted stock

— — 1,170 — — 1,170

Exercise of options 119,356 684 — — — 684

Shares issued for vesting of restricted stock units 6,655 70 ( 70 ) — — —

Shares redeemed to pay income tax

( 1,978 ) — — ( 21 ) — ( 21 )

Net income — — — 2,330 — 2,330

Shareholders' equity, June 30, 2023 38,400,422 $ 17,850 $ 13,488 $ 73,167 $ — $ 104,505

Common Stock Additional paid-in capital Noncontrolling interest in subsidiary

Total Shareholders'

Shares Amount Retained

2 unchanged sentences

Stock-based compensation - restricted stock

— — 1,321 — — 1,321

Exercise of options 60,130 304 — — — 304

3 unchanged sentences

Shareholders' equity, March 31, 2024 38,816,766 $ 21,842 $ 14,294 $ 80,137 $ — $ 116,273

Stock-based compensation - options — — 59 — — 59

Stock-based compensation - restricted stock

— — 1,561 — — 1,561

Exercise of options 4,000 21 — — — 21

Shares issued for vesting of restricted stock units 6,654 47 ( 47 ) — — —

Shares redeemed to pay income tax ( 1,621 ) — — ( 11 ) — ( 11 )

Acquired noncontrolling interest

— — — — 1,800 1,800

Net income — — — 1,468 9 1,477

Shareholders' equity, June 30, 2024 38,825,799 $ 21,910 $ 15,867 $ 81,594 $ 1,809 $ 121,180

See accompanying notes to the condensed consolidated financial statements

2 unchanged sentences

(Expressed in thousands of U.S.

Three Months Ended March 31,

Six Months Ended June 30,

Note 2024 2023

6 unchanged sentences

Income from equity method investments ( 261 ) ( 172 )

Income from debt investment ( 55 ) ( 57 )

Loss (income) from debt investment

1,219 ( 110 )

Loss (gain) on disposal of property and equipment

Amortization of deferred financing costs

Deferred income tax benefit

1 unchanged sentence

Accounts receivable, net ( 8,225 ) ( 500 )

( 6,026 ) ( 941 )

Inventory 470 ( 320 )

Prepaid expenses and other assets 1,523 2,076

2 unchanged sentences

Accrued liabilities ( 904 ) 1,593

( 3,632 ) 1,846

Income tax payable/receivable ( 2,599 ) ( 1,003 )

2 unchanged sentences

Purchase of property and equipment ( 14,940 ) ( 10,759 )

Investment in equity investments — ( 7 )

Cash paid for acquisitions, net of cash acquired

3 ( 2,999 ) ( 27,121 )

Proceeds from sale of property and equipment 4 1,407 1,775

2 unchanged sentences

Proceeds from exercise of options 8 325 1,228

Proceeds from term notes 6 — 5,000

Principal payments on term notes 6 ( 810 ) ( 1,357 )

Proceeds from revolving credit facilities 6 3,000 8,000

Payments on revolving credit facilities — ( 1,005 )

Payments for debt issuance costs

Shares redeemed to pay income tax 8 ( 972 ) ( 526 )

Repayments of finance lease liabilities

Net cash provided by (used in) financing activities $ ( 1,340 ) $ 39

Net increase (decrease) in cash and cash equivalents

( 249 ) ( 37 )

Net cash provided by financing activities

$ 1,143 $ 11,303

Net decrease in cash and cash equivalents ( 4,032 ) ( 6,690 )

Cash and cash equivalents at beginning of year 12,839 16,914

2 unchanged sentences

Cash paid during the period for interest $ 515 $ 169

Cash received during the period for income tax refunds

Cash paid during the period for income taxes, net of refunds

$ 3,841 $ 3,093

Supplemental disclosures of non-cash transactions

Equipment and other fixed asset purchases payable at end of period

$ 2,725 $ 2,526

Equipment sales receivable at end of period

See accompanying notes to the condensed consolidated financial statements

3 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Nature of Business and Operations

6 unchanged sentences

Kaliste Saloom Road, Lafayette, Louisiana 70508.

The Company no longer qualifies as a “smaller reporting company” and is required to comply with the larger company disclosure obligations (subject to certain exemptions and relief from various reporting requirements that are applicable to emerging growth companies) beginning in this Quarterly Report on Form 10-Q.

The Company is an "emerging growth company," as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), and as such, has elected to comply with certain reduced U.S.

5 unchanged sentences

Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.

The accompanying condensed consolidated financial statements are unaudited, but reflect all adjustments consisting of normal recurring accruals, which, in the opinion of management, are necessary to present fairly the Company's Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Income and Comprehensive Income, Condensed Consolidated Statements of Changes in Shareholders’ Equity and Condensed Consolidated Statements of Cash Flows for the interim periods presented.

The accompanying condensed consolidated financial statements are unaudited, but reflect all adjustments consisting of normal recurring accruals, which, in the opinion of management, are necessary to present fairly the Company's Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Income, Condensed Consolidated Statements of Changes in Shareholders’ Equity and Condensed Consolidated Statements of Cash Flows for the interim periods presented.

The Company's fiscal year ends on December 31.

3 unchanged sentences

Basis of Consolidation

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries.

These consolidated financial statements include the accounts of the Company and its subsidiaries in which it has a controlling financial interest.

All intercompany transactions have been eliminated.

8 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Segment Reporting

14 unchanged sentences

Revisions in reserve estimates are recorded as an adjustment to net revenue in the period of revision.

The estimates of the allowance for uncollectible accounts was $ 14.4 million and $ 11.1 million as of March 31, 2024 and December 31, 2023, respectively.

Included in accounts receivable at March 31, 2024 are amounts due from Medicare and Medicaid, representing 25 % and 2 % , respectively, and 27 % combined, of total outstanding receivables.

As of December 31, 2023, 32 % of total outstanding receivables were amounts due from Medicare and Medicaid.

The estimates of the allowance for uncollectible accounts was $ 15.9 million and $ 11.1 million as of June 30, 2024 and December 31, 2023, respectively.

Included in accounts receivable at June 30, 2024 are amounts due from Medicare and Medicaid representing 25 % and 2 % , respectively, and 27 % combined, of total outstanding net receivables.

As of December 31, 2023, 32 % of total outstanding net receivables were amounts due from Medicare and Medicaid.

Inventory represents non-serialized supplies that consist of equipment parts, consumables, and associated product supplies and is expensed at the time of sale or use.

13 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Equity Investments

1 unchanged sentence

The following table details the Company’s equity investments:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Equity method investments $ 434 $ 320

1 unchanged sentence

Balance, end of period $ 1,794 $ 1,680

The Company's equity method investments include a 49 % equity interest in Solvet Services, LLC, an entity which provides health care support services to state and federal governments.

Investments accounted for under the equity method are investments in unconsolidated entities over whose operating and financial policies the Company has the ability to exercise significant influence but not control.

1 unchanged sentence

Distributions received from the investee reduce the Company’s carrying value of the investment.

The Company has recognized its share of income or loss on the gain (loss) from equity method investments within non-operating expenses in the Condensed Consolidated Statements of Income and Comprehensive Income.

The Company has recognized its share of income or loss on the gain (loss) from equity method investments within non-operating expenses in the Condensed Consolidated Statements of Income.

Equity method investments are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of the investments may exceed the fair value.

No events or changes have occurred as of March 31, 2024 that would impair the carrying value of equity method investments.

No events or changes have occurred as of June 30, 2024 that would impair the carrying value of equity method investments.

Other equity investments are investments without a readily determinable fair value which do not qualify for the practical expedient in ASC 820.

1 unchanged sentence

ASU 2019-04 clarifies that if an entity identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it must measure its equity investment at fair value in accordance with ASC 820 as of the date that the observable transaction occurred.

The Company was not aware of any impairment or observable price change adjustments that needed to be made as of March 31, 2024 on its investments in equity securities without a readily determinable fair value.

The Company was not aware of any impairment or observable price change adjustments that needed to be made as of June 30, 2024 on its investments in equity securities without a readily determinable fair value.

Debt Investment

The Company's debt investment is a variable rate secured convertible note issued by Healthcare DX, Inc.

(d/b/a ModoHealth) on December 21, 2022, classified as an available-for-sale debt instrument.

Accrued interest is due upon the 18 month maturity of the note and is included in the amortized cost basis at each reporting period.

The Company's debt investment is a variable rate secured convertible note and is classified as an available-for-sale debt instrument.

Accrued interest is included in the amortized cost basis at each reporting period.

At each financial statement date until a conversion event, the debt instrument is required to be remeasured at fair value.

Changes in unrealized gains and losses are included in accumulated other comprehensive income, net of tax effect, until realized.

Changes in unrealized gains and losses are accounted for in accumulated other comprehensive income, net of tax effect, until realized.

When changes are determined to be other than temporary in nature, the Company recognizes an other than temporary impairment expense in earnings equal to the difference between the debt security’s amortized cost basis and its fair value at the balance sheet date.

Intangible Assets

Intangible assets include trade names and other identifiable intangible assets, which are amortized on a straight-line basis over a period of their expected useful lives, generally five years .

Comprehensive Income

Comprehensive income reflects the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources.

The Company's comprehensive income represents net income adjusted for unrealized gains and losses, net of tax.

Accumulated other comprehensive loss is presented on the accompanying Condensed Consolidated Balance Sheets as a component of shareholders' equity.

VIEMED HEALTHCARE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollar amounts expressed in thousands of U.S.

Dollars, except per share amounts)

March 31, 2024 and 2023

Revenue Recognition

2 unchanged sentences

Revenue generated from equipment that is rented to patients is recognized over the non-cancellable rental period (typically one month) and commences on delivery of the equipment to the patients.

The lease agreements are evaluated at lease commencement and the start of each monthly renewal period to determine if it is reasonably certain that the monthly renewal or purchase options would be exercised.

The agreements are evaluated at commencement and the start of each monthly renewal period to determine if it is reasonably certain that the monthly renewal or purchase options would be exercised.

The exercise of monthly renewal or purchase options by a patient has historically not been reasonably certain to occur at lease commencement or subsequent monthly renewal.

Revenues are recorded at amounts estimated to be received under reimbursement arrangements with third-party payors, including private insurers, prepaid health plans, Medicare, Medicaid and patients.

VIEMED HEALTHCARE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollar amounts expressed in thousands of U.S.

Dollars, except per share amounts)

June 30, 2024 and 2023

Revenues are recorded at amounts estimated to be received under reimbursement arrangements with payors, including private insurers, prepaid health plans, Medicare, Medicaid and patients.

Rental revenue, less estimated adjustments, is recognized as earned on a straight-line basis over the non-cancellable lease term.

5 unchanged sentences

Revenue related to sales of equipment and supplies is recognized on the date of delivery as this is when control of the promised goods is transferred to patients and is presented net of applicable sales taxes.

Revenues are recorded only to the extent it is probable that a significant reversal will not occur in the future as amounts may include implicit price concessions under reimbursement arrangements with third-party payors, including private insurers, prepaid health plans, Medicare, Medicaid and patients.

Revenues are recorded only to the extent it is probable that a significant reversal will not occur in the future as amounts may include implicit price concessions under reimbursement arrangements with payors, including private insurers, prepaid health plans, Medicare, Medicaid and patients.

The sales transaction price is determined based on contractually agreed-upon rates, adjusted for estimates of variable consideration.

6 unchanged sentences

The revenues from each major source are summarized in the following table:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Revenue from rentals

1 unchanged sentence

Other home medical equipment rentals

12,211 8,419 23,145 15,325

Revenue from sales and services

Equipment and supply sales

7,378 6,778 13,516 11,542

Service revenues

4,931 2,402 9,265 5,141

Total revenues $ 54,965 $ 43,311 $ 105,558 $ 82,867

Revenues from Medicare as percentages of the Company's total revenue for the six months ended June 30, 2024 and 2023 were 43 % and 45 %, respectively.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

Revenues from Medicare as percentages of the Company's total revenue for the three months ended March 31, 2024 and 2023 were 43 % and 45 %, respectively.

June 30, 2024 and 2023

Stock-Based Compensation

8 unchanged sentences

jurisdictions.

Significant judgment is required in determining the provision for income taxes.

The Company's income tax provisions reflect management’s interpretation of country and state tax laws.

14 unchanged sentences

The results of operations of the business acquired by the Company are included as of the respective acquisition date.

The acquisition-date fair value of the consideration transferred, including the fair value of any contingent consideration, is allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition.

To the extent the acquisition-date fair value of the consideration transferred exceeds the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed, such excess is allocated to goodwill.

The acquisition-date fair value of the consideration transferred, including the fair value of any contingent consideration, is allocated to the underlying assets acquired, liabilities assumed, and noncontrolling interest in the acquiree based upon their estimated fair values at the date of acquisition.

To the extent the acquisition-date fair value of the consideration transferred exceeds the fair value of the identifiable tangible and intangible assets acquired, liabilities assumed, and any noncontrolling interests, such excess is allocated to goodwill.

Patient relationships, medical records and patient lists are not reported as separate intangible assets due to the regulatory requirements and lack of contractual agreements but are part of goodwill.

Customer related relationships are not reported as separate intangible assets but are part of goodwill as authorizing physicians are under no obligation to refer the Company’s services to their patients, who are free to change physicians and service providers at any time.

The Company may adjust the preliminary purchase price allocation, as necessary, as it obtains more information regarding asset valuations and liabilities assumed that existed but were not available at the acquisition date, which is generally up to one year after

Acquisition related costs are recognized separately from the business combination and are expensed as incurred.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

the acquisition closing date.

Acquisition related costs are recognized separately from the business combination and are expensed as incurred.

June 30, 2024 and 2023

Impairment of Goodwill and Long-Lived Assets

13 unchanged sentences

When properties are classified as held for sale, they are recorded at the lower of the carrying amount or the expected sales price less costs to sell.

There were no impairment charges recognized during the three months ended March 31, 2024 and March 31, 2023.

Net Income per Share Attributable to Common Stockholders

Basic net income per common share is computed based on the weighted average number of shares of common stock outstanding during the period.

Diluted net income per common share is computed based on the weighted average number of shares of common stock plus the effect of dilutive stock-based awards outstanding during the period using the treasury stock method.

There were no impairment charges to goodwill or long-lived assets recognized during the six months ended June 30, 2024 and June 30, 2023.

Net Income per Share Attributable to Viemed Healthcare, Inc.'s Common Stockholders

Basic net income per share is computed based on the weighted average number of shares of common stock outstanding during the period.

Diluted net income per share is computed based on the weighted average number of shares of common stock plus the effect of dilutive stock-based awards outstanding during the period using the treasury stock method.

Dilutive stock-based awards include outstanding common stock options and time-based RSUs.

4 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Recently adopted accounting pronouncements

20 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Business Combinations

On June 1, 2023, Viemed, Inc., a wholly-owned subsidiary of the Company, completed the acquisition of Home Medical Products, Inc.

(“HMP”), which operates in Tennessee, Alabama, and Mississippi.

East Alabama HomeMed, LLC

On April 1, 2024, the Company acquired a controlling 60 % equity interest in East Alabama HomeMed, LLC ("HomeMed").

The acquisition was accounted for under the acquisition method of accounting in accordance with ASC 805.

As a result of the acquisition, goodwill of $ 3.2 million and a trade name of $ 0.4 million were recognized.

The Company expects its portion of the goodwill to be fully tax-deductible.

Additionally, a noncontrolling interest of $ 1.8 million was recorded at the acquisition date.

The accompanying financial statements include the results of HomeMed's operations from the acquisition date.

Changes in the noncontrolling interests after the acquisition date are accounted for pursuant to ASC 810, Consolidation .

Home Medical Products, Inc.

On June 1, 2023, Viemed, Inc., a wholly-owned subsidiary of the Company, completed the acquisition of Home Medical Products, Inc., (“HMP”), which operates in Tennessee, Alabama, and Mississippi.

The Company acquired 100 % of the equity ownership of HMP in exchange for approximately $ 29 million in cash or cash payable, subject to customary post-closing net working capital and other adjustments.

Approximately $ 16 million of the purchase consideration was funded by cash on hand, $ 8 million was funded by a borrowing on the 2022 Revolving Credit Facility, and $ 5 million was funded by a borrowing on the 2022 Term Loan Facility.

The results of HMP’s operations have been included in the condensed consolidated financial statements since the date of acquisition.

The following table summarizes the consideration paid and estimated fair values of the assets acquired and liabilities assumed at the acquisition date:

24 unchanged sentences

There are no contingent consideration arrangements included in the transaction.

The results of HMP’s operations have been included in the condensed consolidated financial statements since the date of acquisition.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Property and Equipment

1 unchanged sentence

The following table details the Company’s fixed assets:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Medical equipment $ 116,318 $ 110,920

5 unchanged sentences

Accumulated depreciation ( 58,054 ) ( 52,937 )

Property and equipment, net of accumulated depreciation and amortization $ 73,511 $ 73,579

Depreciation in the amount of $ 5.9 million and $ 4.5 million is included in cost of revenue for the three months ended March 31, 2024 and 2023, respectively.

Medical equipment purchases with a cost of $ 2.4 million and $ 1.4 million were included in accounts payable at March 31, 2024 and December 31, 2023, respectively.

Property and equipment, net of accumulated depreciation

$ 74,701 $ 73,579

Depreciation in the amount of $ 5.9 million and $ 4.9 million is included in cost of revenue for the three months ended June 30, 2024 and 2023, respectively, and in the amount of $ 11.8 million and $ 9.4 million for the six months ended June 30, 2024 and 2023, respectively.

Current Liabilities

The Company’s short-term accrued liabilities are included within current liabilities and consist of the following:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Accrued trade payables $ 3,896 $ 3,230

5 unchanged sentences

Total accrued liabilities $ 16,801 $ 17,578

VIEMED HEALTHCARE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollar amounts expressed in thousands of U.S.

Dollars, except per share amounts)

June 30, 2024 and 2023

Debt and Lease Liabilities

The following table summarizes the Company’s debt as of March 31, 2024 and December 31, 2023:

March 31, 2024 December 31, 2023

The following table summarizes the Company’s debt as of June 30, 2024 and December 31, 2023:

June 30, 2024 December 31, 2023

2022 Senior Credit Facilities

7 unchanged sentences

$ 8,715 $ 6,002

VIEMED HEALTHCARE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollar amounts expressed in thousands of U.S.

Dollars, except per share amounts)

March 31, 2024 and 2023

2022 Senior Credit Facilities

7 unchanged sentences

• Consolidated Fixed Charge Coverage Ratio ( defined generally as (a) adjusted EBITDA minus capital expenditures minus cash taxes to (b) the sum of scheduled principal payments plus cash interest expense plus restricted payments) of not less than 1.25 :1.0.

The Company was in compliance with all covenants under the 2022 Senior Credit Facilities in effect at March 31, 2024.

The Company was in compliance with all covenants under the 2022 Senior Credit Facilities in effect at June 30, 2024.

The 2022 Senior Credit Facilities include provisions permitting the Company from time to time to, subject to certain terms and conditions, increase the aggregate amount of commitments under the 2022 Revolving Credit Facility and/or establish one or more additional term loans under the 2022 Term Loan Facility, in each case, with additional commitments from existing lenders or new commitments from financial institutions acceptable to the Administrative Agent in its reasonable discretion;

provided, that, (a) the aggregate principal amount of any increases in the 2022 Revolving Credit Facility, and (b) the aggregate principal amount of all additional term loans under the 2022 Term Loan Facility established after the closing date will not exceed $ 30.0 million.

Financing costs related to the 2022 Senior Credit Facilities are capitalized and amortized over the term of the loans using the effective interest method.

Upon the initial draw of debt under the 2022 Senior Credit Facilities during the year ended December 31, 2023, the Company reclassified the deferred financing fees previously recorded in other long-term assets to long-term debt in the condensed consolidated balance sheets.

Medical Equipment Financing

As a result of the acquisition of HMP, the Company assumed equipment financing obligations consisting of installment payments for medical equipment which secure the financing.

The financing obligations are payable in monthly installments through 2026 and include interest at rates ranging from 0 % to 7.99 %.

As of March 31, 2024 , $ 0.3 million of the outstanding medical equipment financing obligations is presented on the condensed consolidated balance sheets as short term debt based on the scheduled repayment dates.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Financing costs related to the issuance and amendments of 2022 Senior Credit Facilities are capitalized and amortized over the term of the loans using the effective interest method.

On May 28, 2024, the Company entered into a First Amendment to the 2022 Senior Credit Facilities that (a) extends the delayed draw term loan commitment expiration date to November 29, 2025, from its initial expiration date of May 29, 2024, and (b) provides for other technical amendments.

Payment for debt issuance costs associated with the amendment was $ 0.2 million during the six months ended June 30, 2024.

Medical Equipment Financing

The Company enters into medical equipment financing obligations through supplier finance programs.

The financing obligations are primarily short term in nature and are payable in monthly installments.

As of June 30, 2024, $ 0.4 million of the outstanding medical equipment financing is presented on the condensed consolidated balance sheets as short term debt based on the scheduled repayment dates.

The Company has recognized finance lease liabilities for vehicles and operating leases for land and buildings that have terms greater than twelve months, as follows:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Lease liabilities $ 2,981 $ 3,250

5 unchanged sentences

These lease liabilities are recorded at present value based on a discount rate of 5.5 %, which was based on the Company's incremental borrowing rate at the time of assessment.

At March 31, 2024, the weighted average lease term was approximately 4.36 years.

Future maturities of the Company's operating lease liabilities as of March 31, 2024 are summarized as follows:

At June 30, 2024 , the weighted average lease term was approximately 3.88 years.

Future maturities of the Company's operating lease liabilities as of June 30, 2024 are summarized as follows:

Lease Liability

2 unchanged sentences

Present value of lease liabilities $ 2,842

Operating rental expenses for the three months ended March 31, 2024 amounted to $ 355,000 .

Operating rental expenses for the six months ended June 30, 2024 amounted to $ 0.7 million.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Fair Value Measurement

10 unchanged sentences

There were no transfers between fair value measurement levels during any presented period.

The following tables summarize the Company's assets measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023:

At March 31, 2024

The following tables summarize the Company's assets measured at fair value on a recurring basis as of June 30, 2024 and December 31, 2023:

At June 30, 2024

(In thousands) Level 1 Level 2 Level 3 Total

10 unchanged sentences

Available for Sale Debt Instrument

The fair value of the Company’s available for sale debt instrument approximates its amortized cost basis due to the short maturity and indexed interest rate terms.

The fair value is classified within Level 3 in the fair value hierarchy as the Company evaluates adjustments using a combination of observable and unobservable inputs, such as operating results of the counterparty as well observable prices in transactions of debt and equity instruments of the issuing counterparty when available.

As of March 31, 2024, the analysis resulted in no adjustments to the carrying value impacting unrealized gains or losses.

All changes to measured fair value during the period were the result of accrued interest.

The fair value of the Company’s available for sale debt instrument is classified within Level 3 in the fair value hierarchy as the Company evaluates adjustments using a combination of observable and unobservable inputs, such as operating results of the counterparty as well observable prices in transactions of debt and equity instruments of the issuing counterparty when available.

As of June 30, 2024, the analysis resulted in the determination that the decline in fair value was an other than temporary impairment (OTTI).

Accordingly, the Company recognized an OTTI loss of $ 1.3 million in Income (expense) from investments during the quarter ended June 30, 2024.

The recognized loss is equal to the difference between the debt security’s amortized cost basis and its fair value at the balance sheet date, based on management's estimate of fair value.

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

20 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Shareholders' Equity

3 unchanged sentences

The Company has only one class of stock outstanding, common shares.

The authorized stock consists of an unlimited number of common shares with no stated par value, of which 38,816,766 and 38,506,161 shares were issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.

The Company acquired and cancelled 128,362 common shares at a cost of $ 1.0 million to satisfy employee income tax withholding associated with RSUs vesting during the three months ended March 31, 2024.

The authorized stock consists of an unlimited number of common shares with no stated par value, of which 38,825,799 and 38,506,161 shares were issued and outstanding as of June 30, 2024 and December 31, 2023, respectively.

The Company acquired and cancelled 129,983 common shares at a cost of $ 1.0 million to satisfy employee income tax withholding associated with RSUs vesting during the six months ended June 30, 2024.

The Company’s retained earnings were reduced by the amount paid for the shares repurchased and cancelled.

1 unchanged sentence

On June 6, 2024 (the "Effective Date"), the Company’s shareholders approved the Company's 2024 Long Term Incentive Plan (the "2024 Omnibus Plan") to provide an incentive to attract, retain, and reward directors, officers, employees, and consultants who provide services to the Company or any of its subsidiaries.

Upon approval of the Omnibus Plan, no future awards are available to be made under the Company's previous RSU and Option Plans (collectively, the "Former Plan"), and the common shares that were not settled or awarded under the Former Plan as of the Effective Date are available for awards under the Omnibus Plan.

The maximum number of common shares that are available for awards under the Omnibus Plan and under any other security based compensation arrangements adopted by the Company, including the Former Plan, may not exceed 7,758,211 shares (equal to 20 % of the issued and outstanding common shares of the Company on the Effective Date).

The maximum amount of the foregoing common shares that may be awarded under the Omnibus Plan as “incentive stock options” is 2,600,000 common shares.

As of March 31, 2024, the Company had outstanding options of 4,152,000 and RSUs of 1,524,000 associated with common shares under the Omnibus Plan.

The following table summarizes stock-based compensation expense for the three months ended March 31, 2024 and 2023 (in thousands):

Three Months Ended March 31,

All directors, officers, employees, and consultants of the Company and/or its affiliates are eligible to receive awards under the 2024 Omnibus Plan, subject to its terms.

Awards include common share purchase options, restricted stock, stock appreciation rights, performance awards, or other stock-based awards, including restricted stock units, deferred stock units, and dividends and dividend equivalents.

The maximum number of common shares that will be available for awards and issuance under the 2024 Omnibus Plan and that may be reserved for issuance at any time, including under previous plans such as the 2020 Long Term Incentive Plan (effective June 11, 2020), the Amended and Restated Stock Option Plan (effective as of July 17, 2018), the Amended and Restated Restricted Share Unit Plan (effective as of July 17, 2018), and the Deferred Share Unit Plan (effective July 17, 2018), will be 7,800,000 shares.

The maximum amount of common shares that may be awarded under the 2024 Omnibus Plan as “incentive stock options” is 1,000,000 common shares.

As of June 30, 2024, the Company had outstanding options of 4,143,000 and RSUs of 1,538,000 associated with common shares under the existing plans.

The following table summarizes stock-based compensation expense for the three and six months ended June 30, 2024 and 2023 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Stock-based compensation - options $ 59 $ 301 $ 170 $ 649

1 unchanged sentence

Total $ 1,620 $ 1,471 $ 3,052 $ 2,862

At March 31, 2024, there was approximately $ 220,000 of total unrecognized pre-tax stock option expense under the Company's equity compensation plans, which is expected to be recognized over a weighted average period of 0.91 years .

As of March 31, 2024, there was approximately $ 8,232,000 of total unrecognized pre-tax compensation expense related to outstanding time-based restricted stock units that is expected to be recognized over a weighted average period of 0.95 years .

At June 30, 2024, there was approximately $ 147,000 of total unrecognized pre-tax stock option expense under the Company's equity compensation plans, which is expected to be recognized over a weighted-average period of 0.67 years .

As of June 30, 2024, there was approximately $ 6,782,000 of total unrecognized pre-tax compensation expense related to outstanding time-based restricted stock units that is expected to be recognized over a weighted-average period of 1.57 years .

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

The following table summarizes stock option activity for the three months ended March 31, 2024:

June 30, 2024 and 2023

The following table summarizes stock option activity for the six months ended June 30, 2024:

Number of options

4 unchanged sentences

Expired / Forfeited ( 7 ) 5.21

Balance March 31, 2024 4,152 $ 5.25 5.6 years $ 17,423

Balance June 30, 2024 4,143 $ 5.25 5.4 years $ 7,198

(1) For presentation purposes, stock options issued with a Canadian dollar exercise price have been translated to U.S.

dollars based on the prevailing exchange rate on the date of grant.

(2) The aggregate intrinsic value of options outstanding represents the difference between the exercise price of the option and the closing price of the Company's common shares on the last trading day of the perio d ($ 9.43 and $ 7.85 on March 31, 2024 and December 31, 2023, respectively).

The aggregate intrinsic value of options outstanding was $ 17,423,000 and options exercisable was $ 16,278,000 at March 31, 2024.

For the three months ended March 31, 2024, 60,130 common shares were issued pursuant to the exercise of stock options.

At March 31, 2024, the Company had 3,861,000 exercisable stock options outstanding with a weighted average exercise price of $ 5.23 and a weighted average remaining contractual life of 5.5 years .

(2) The aggregate intrinsic value of options outstanding represents the difference between the exercise price of the option and the closing price of the Company's common shares on the last trading day of the period ( $ 6.55 and $ 7.85 on June 30, 2024 and December 31, 2023, respectively ).

The aggregate intrinsic value of options outstanding was $ 7,198,163 and options exercisable was $ 6,888,789 at June 30, 2024.

For the six months ended June 30, 2024, 64,130 common shares were issued pursuant to the exercise of stock options.

At June 30, 2024, the Company had 3,874,000 exercisable stock options outstanding with a weighted average exercise price of $ 5.24 and a weighted average remaining contractual life of 5.2 years .

At December 31, 2023, the Company had 3,461,000 exercisable stock options outstanding with a weighted average exercise price of $ 4.99 and a weighted average remaining contractual life of 5.5 years .

The fair value of the stock options has been charged to the Condensed Consolidated Statements of Income and Comprehensive Income and credited to additional paid-in capital over the vesting period, using the grant date fair value based on the Black-Scholes option pricing model.

The fair value of the stock options has been charged to the Condensed Consolidated Statements of Income and credited to additional paid-in capital over the vesting period, using the grant date fair value based on the Black-Scholes option pricing model.

The assumptions used to determine the grant date fair value of stock options include exercise price, risk-free interest rates, expected volatility, and average life of an option.

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Expected volatility is based on implied volatilities from traded options on the Company's common shares and historical volatility of the Company's common shares over the expected life of the option.

There were no issuances of options during the three months ended March 31, 2024.

There were no issuances of options during the six months ended June 30, 2024.

Restricted Stock Units

The Company accounts for RSUs using fair value.

The fair value of the RSUs has been charged to the Condensed Consolidated Statements of Income and Comprehensive Income and credited to additional paid-in capital over the vesting period, based on the stock price on the date of grant.

The fair value of the RSUs has been charged to the Condensed Consolidated Statements of Income and credited to additional paid-in capital over the vesting period, based on the stock price on the date of grant.

RSUs vest generally over a one or three-year period.

The Company accounts for forfeitures of RSUs under ASU 2016-09 and recognizes forfeitures in the period in which they occur.

The following table summarizes RSU activity for the three months ended March 31, 2024:

The following table summarizes RSU activity for the six months ended June 30, 2024:

Number of RSUs (000's) Weighted average grant price Weighted average remaining contractual life Aggregate intrinsic value (1)

2 unchanged sentences

Vested ( 385 ) 6.90

Balance March 31, 2024 1,524 $ 7.84 0.95 years $ 14,371

(1) The aggregate intrinsic value of time-based RSUs outstanding was based on the closing price of the Company's common shares on the last trading day of the p eriod ($ 9.43 and $ 7.85 on March 31, 2024 and December 31, 2023, respectively ) .

Balance June 30, 2024 1,538 $ 7.83 1.57 years $ 10,074

(1) The aggregate intrinsic value of time-based RSUs outstanding was based on the closing price of the Company's common shares on the last trading day of the period ( $ 6.55 and $ 7.85 on June 30, 2024 and December 31, 2023, respectively ).

VIEMED HEALTHCARE, INC.

2 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

During the three months ended March 31, 2024, the Company issued 749,900 RSUs with equal annual vestings over a three year period and a fair value of $ 8.39 per share.

June 30, 2024 and 2023

During the three months ended June 30, 2024, the Company issued 47,726 RSUs with equal annual vestings over a three year period and a fair value of $ 0.3 million .

During the six months ended June 30, 2024, the Company issued 798,000 RSUs with equal annual vestings over a three year period and a fair value of $ 6.4 million .

Phantom Share Units

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The cash-settled phantom share units are accounted for as liability awards and are re-measured at fair value each reporting period until they become vested with accrued liability and related expense being recognized over the requisite service period.

The following table summarizes phantom share unit activity for the three months ended March 31, 2024:

The following table summarizes phantom share unit activity for the six months ended June 30, 2024:

Number of phantom share units (000's) Value of share equivalents (1)

2 unchanged sentences

Vested ( 210 ) 1,550

Balance March 31, 2024

( 14 ) ( 94 )

Balance June 30, 2024 460 $ 3,013

(1) The value of outstanding share equivalents at the beginning of the period is based on the market price of the Company’s common shares at that time, the value of issued share equivalents is based on the market price of the Company’s common shares at issuance, the value of vested share equivalents is based on the cash paid at the time of vesting, and the values of forfeited share equivalents and outstanding share equivalents at the end of the period are based on the market price of the Company's common shares at the end of the period.

The market price of the Company's common shares wa s $ 9.43 and $ 7.85 on March 31, 2024 and December 31, 2023, respectively.

The change in fair value of the phantom share units has been charged to the Condensed Consolidated Statements of Income and Comprehensive Income and recorded as a liability included in accrued liabilities and long-term accrued liabilities.

The total liability associated with phantom share units at March 31, 2024 is $ 2,301,000 , with $ 1,854,000 of this amount included in current accrued liabilities and the remaining portion of $ 447,000 included in long-term accrued liabilities.

The impact associated with the fair value re-measurement of phantom share units is recorded in selling, general and administrative expenses within the unaudited Condensed Consolidated Statements of Income and Comprehensive Income.

The following table summarizes expense associated with the phantom share units for the three months ended March 31, 2024 and 2023 (in thousands):

Three Months Ended March 31,

The market price of the Company's common shares was $ 6.55 and $ 7.85 on June 30, 2024 and December 31, 2023, respectively.

The change in fair value of the phantom share units has been charged to the Condensed Consolidated Statements of Income and recorded as a liability included in accrued liabilities and long-term accrued liabilities.

The total liability associated with phantom share units at June 30, 2024 is $ 1,427,000 , with $ 986,000 of this amount included in current accrued liabilities and the remaining portion of $ 441,000 included in long-term accrued liabilities.

The following table summarizes expense (benefit) associated with the phantom share units for the three and six months ended June 30, 2024 and 2023 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Selling, general, and administrative $ ( 287 ) $ 687 $ 553 $ 1,837

The Company paid cash settlements of $ 1.0 million and $ 0.6 million during the three months ended March 31, 2024 and 2023, respectively, pertaining to vestings of cash-settled phantom share units.

The Company paid cash settlements of $ 1.6 million and $ 2.3 million during the six months ended June 30, 2024 and 2023, respectively, pertaining to vestings of cash-settled phantom share units.

VIEMED HEALTHCARE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollar amounts expressed in thousands of U.S.

Dollars, except per share amounts)

June 30, 2024 and 2023

Commitments and Contingencies

4 unchanged sentences

Furthermore, the outcome of legal proceedings is inherently uncertain, and we may incur substantial defense costs and expenses defending any of these matters.

VIEMED HEALTHCARE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tabular dollar amounts expressed in thousands of U.S.

Dollars, except per share amounts)

March 31, 2024 and 2023

Legal Proceedings

6 unchanged sentences

The State Court issued an order on September 5, 2023 granting the Company Partial Summary Judgment finding that Vyaire breached the contract.

However, the determination of damages resulting from Vyaire's breach was reserved for a non-jury trial.

Vyaire has appealed the State Court's Partial Summary Judgment and has filed its opening brief, to which the Company has responded by filing its opposition brief.

The Company continues to believe that it has valid legal and equitable grounds to recover its outstanding prepayment as a result of Vyaire’s failure to deliver the vast majority of the respiratory equipment referenced in the Purchase Order.

The Company has determined that a loss related to the Reconventional Demand is not probable, and thus has not accrued a liability related to this claim.

Although a loss may be reasonably possible, the Company does not have sufficient information to determine the amount or range of reasonably possible loss with respect to the Reconventional Demand given that the dispute is in the early stages of the legal process.

As of March 31, 2024, outstanding funds in the amount of $ 0.9 million related to undelivered respiratory equipment are included within other long-term assets.

However, on June 9, 2024, Vyaire and certain of its affiliates filed voluntary bankruptcy under Chapter 11 of the Bankruptcy Code in the US Bankruptcy Court for the District of Delaware.

The Company continues to believe that it has valid legal and equitable claims to recover its outstanding prepayment as a result of Vyaire’s failure to deliver the vast majority of the respiratory equipment referenced in the Purchase Order.

However, as a result of the bankruptcy filing, collection of the outstanding prepaid amounts is no longer determined to be probable.

During the three months ended June 30, 2024, outstanding funds receivable in the amount of $ 0.9 million related to undelivered respiratory equipment were impaired through Other expense (income).

Governmental and Regulatory Matters

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Reviews, audits and investigations of this sort can lead to government actions, which can result in the assessment of recoupment of reimbursement, civil or criminal fines or penalties, or other sanctions, including restrictions or changes in the way the Company conducts business, loss of licensure or exclusion from participation in government healthcare programs.

For the three months ended March 31, 2024, the Company recorded income tax expe nse of $ 0.5 million, which includes a discrete tax benefit of $ 0.1 million associated with stock-based compensation arrangements.

Excluding the impact of the discrete taxes, the effective rate for the three months ended March 31, 2024 is 29.2 % .

For the six months ended June 30, 2024, the Company recorded income tax expense of $ 1.3 million, which includes a discrete tax benefit of $ 0.1 million associated with stock-based compensation arrangements.

Excluding the impact of the discrete taxes, the effective rate for the six months ended June 30, 2024 is 30.9 %.

The effective rate differs from the amount computed by applying the statutory federal and state income tax rates to ordinary income before the provision for income taxes due to permanent non-deductible differences.

The Company's effective tax rate is based on forecasted annual results which may fluctuate significantly through the rest of the year.

At March 31, 2024 and 2023, the Company had no amounts recorded for uncertain tax positions and does not expect any material changes in uncertain tax benefits during the next 12 months.

At June 30, 2024 and 2023, the Company had no amounts recorded for uncertain tax positions and does not expect any material changes in uncertain tax benefits during the next 12 months.

The Company recognizes interest and penalties related to income tax matters in income tax expense.

8 unchanged sentences

Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Earnings Per Share

2 unchanged sentences

The following reflects the earnings and share data used in the basic and diluted earnings per share computations:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Numerator - basic and diluted:

Net income attributable to shareholders $ 1,603 $ 1,517

Basic weighted average number of common shares

Net income attributable to Viemed Healthcare, Inc.

$ 1,468 $ 2,330 $ 3,071 $ 3,847

Basic weighted-average number of common shares 38,822,980 38,324,249 38,558,479 38,240,902

Diluted weighted-average number of shares 40,553,449 40,676,951 40,313,042 40,383,616

40,580,634 40,016,693

Basic earnings per share $ 0.04 $ 0.06 $ 0.08 $ 0.10

2 unchanged sentences

Basic weighted-average number of common shares 38,822,980 38,324,249 38,558,479 38,240,902

38,717,123 38,156,777

Stock options and other dilutive securities 1,730,469 2,352,702 1,754,563 2,142,714

Diluted weighted-average number of shares 40,553,449 40,676,951 40,313,042 40,383,616

40,580,634 40,016,693

Anti-dilutive shares excluded from the calculation consisted of dilutive employee stock options and RSUs that were de minimis in all periods presented.

Subsequent Events

On July 31, 2024, the Company repaid $ 3.0 million of its 2022 Revolving Credit Facility, reducing the outstanding balance from $ 4.8 million to $ 1.8 million.

VIEMED HEALTHCARE, INC.

1 unchanged sentence

(Tabular amounts expressed in thousands of US Dollars, except per share amounts)

March 31, 2024 and 2023

June 30, 2024 and 2023

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements