agility health investor presentation - investor tab 07.18.16

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  • INVESTOR

    PRESENTATION

    July 18, 2016

    A final base shelf prospectus containing important information relating to the securities described in this document has been filed with the securities

    regulatory authorities in the provinces of British Columbia, Alberta and Ontario. A copy of the final base shelf prospectus, any amendment to the final

    base shelf prospectus and any applicable shelf prospectus supplement that has been filed, is required to be delivered with this document.

    This document does not provide full disclosure of all material facts relating to the securities offered. Investors should read the final base shelf prospectus,

    any amendment and any applicable shelf prospectus supplement for disclosure of those facts, especially risk factors relating to the securities offered,

    before making an investment decision.

  • Safe Harbor

    Disclosure

    Certain statements contained in this presentation may be considered forward-looking information as defined

    under applicable Canadian securities laws (forward-looking statements). Forward-looking statements

    include, but are not limited to, statements made under the heading Risk Factors of the base shelf prospectus of

    Agility Health, Inc. dated May 29, 2015 and other statements concerning the objectives of Agility Health, Inc.

    (Agility), strategies to achieve those objectives, as well as statements with respect to managements beliefs,

    plans, estimates, and intentions, and similar statements concerning anticipated future events, results,

    circumstances, performance or expectations that are not historical facts. Forward-looking statements generally

    can be identified by the use of forward-looking terminology such as outlook, objective, may, will, expect,

    intend, estimate, anticipate, believe, should, plans, or continue, or similar expressions suggesting

    future outcomes or events. Such forward-looking statements reflect managements current beliefs and are based

    on information currently available to management. Forward-looking statements involve risks and uncertainties

    that could cause actual results to differ materially from those contemplated by such statements.

    No assurance can be given as to any such future results, levels of activity or achievements and neither Agility nor

    any other person assumes responsibility for the accuracy and completeness of any forward-looking statements.

    The factors underlying current expectations are dynamic and subject to change. All forward-looking statements in

    this presentation are qualified by these cautionary statements. Other than specifically required by applicable laws,

    Agility is under no obligation and expressly disclaims any such obligation to update or alter the forward-looking

    statements whether as a result of new information, future events or otherwise except as may be required by law.

    All reference to dollars in this presentation are to U.S. dollars, unless otherwise indicated.

    2

  • Who We Are

    Agility Health, Inc. (Agility) is a leading healthcare provider

    with a focus on physical rehabilitation services

    Differentiated business model

    Growth in revenues, margins and EBITDA

    Highly fragmented industry

    Capitalize on growing demand

    Large, growing industry

    Experienced leadership

    3

  • Corporate Overview

    Network of Service Sites

    1+ million patient visits annually

    1,098+ employees

    155+ locations

    Consolidating highly fragmented

    market

    4

  • Steve Davidson,

    PT, MBA

    Chief Executive Officer

    33 years

    healthcare

    experience

    Licensed

    physical

    therapist

    Ken Scholten,

    PT

    President

    39 years

    healthcare

    experience

    Licensed

    physical

    therapist

    Gene K. Miyamoto,

    MHSA

    Chief Financial Officer (Interim)

    /Chief Operating Officer

    33 years

    healthcare

    experience

    Master in

    Health Services

    Administration

    AGILITY HEALTH Management Team

  • Agility Health

    Our Business

    Long-Term

    Care

    Contract Services

    Outpatient

    Clinics

    Hospitals

    Contract Services

    Industrial

    44% of Revenue 11% of Revenue 16% of Revenue 29% of Revenue

    Medicare or Medicaid (government payors)

    represented ~10% of direct receivables in 2014

    6

  • Revenue Trends (USD)

    $0

    $10

    $20

    $30

    $40

    $50

    $60

    $70

    $80

    2014

    $62.1

    7

    Cost containment review in late 2014

    stripped $1.2 million out of fixed costs.

    Closure of non performing clinics in

    Boston will save $1.5 - $2.0 million a

    year.

    Focus on higher margin lines of

    business.

    Focus on same-store (clinic) visit

    volumes

  • 8

    Q2 & Q3, 2015 Highlights

    4% 2014

    10% Q2

    2015

    EBITDA for the second quarter

    grew to a record $ 1.5 million or

    10% of revenues

    Gross margin from operations for

    the second quarter was 22%

    Revenue from continuing

    operations for the second quarter

    was $15.8 million

    __% Q3

    2015

  • 9

    Agility announced that it has opened a new, 2800 square foot

    clinic in Mattawan, Michigan, the first of several greenfield

    expansions planned for 2015.

    Agility announced that its wholly owned orthotics division,

    Biocorrect LLC, had achieved Medicare accreditation and

    billing privileges.

    Completed a CDN$ 2.7 million prospectus offering.

    Open new 2,800 square feet Outpatient Center in Kansas City

    market.

    BDO USA named as new Auditors.

    Expanded Boeing-Everett relationship increase 50%.

    Highlights for Q2 & Q3, 2015

  • TARGET

    MARKET

  • Physical rehabilitation industry: $26.9 billion

    Outpatient rehabilitation market: $10 billion

    Highly fragmented, with more than 30,000 individual clinics

    Eight largest firms account for only 11.3% of the industry

    Top 50 companies represent less than 25%

    Market Overview

    11

  • Patient Protection and Affordable Care Act increases Insured

    population with Insurance coverage

    Senior population growth

    2.4% Annual Increase in US residents 50+

    Increased desire by elderly to retain an active lifestyle

    Growing awareness and acceptance of physical rehabilitation

    services

    Shifting patients earlier from institutional settings (e.g.

    hospitals) to outpatient centers

    Rising obesity rates in population supports the need for

    rehabilitation services

    Demand for Therapy Services

    12

  • Companies in this space are either very large or very

    small

    Increasing regulatory burden contributes to smaller clinics

    seeking to strategically partner or to divest

    Agilitys scale makes many acquisitions insufficient in size

    for others to consolidate

    Agility intends to act as a partner and consolidate smaller

    companies for the foreseeable future

    Market Dynamics Favor Consolidation

    13

  • GROWTH

    STRATEGY

  • Agility Health

    Growth Strategy

    Acquisitions

    Strong local brands

    Growth Platform

    Leverage our

    infrastructure and

    clinical portfolio

    De Novo

    Clinician

    partnerships

    Existing market

    expansion, and new

    market penetration

    Organic

    Organic with

    existing clients

    New client wins:

    Industrial

    Hospital

    Nursing Home

    Primary Focus

    15

    Opportunistic

  • Integration of services such as IT/server, scheduling/PM software,

    HR, billing, benefits, etc.

    Potential economics of scale (administrative services)

    Acquisition growth complemented by organic clinical expansion and

    horizontal integration of product lines (e.g. selling contract therapy

    services in our new outpatient acquisition markets)

    Agility Health

    An Ideal Consolidator & Strategic Partner

    16

  • Agility has developed a proprietary software package tailored to the

    needs of our industry

    Case management, scheduling, work queues, reporting, patient

    records, paperless documentation, compliance, billing,

    payment, etc.

    AgileRPM, has been implemented in 73 clinics with 682 users

    We have invested over $3M in the development of AgileRPM

    AgileRPM provides recurring revenue through a Software as a

    Service or SaaS model in which outpatient clinic and hospital

    partners subscribe to our service for a monthly fee

    Implementing our system results in improved therapist productivity

    due to reductions in time spent on administrative duties

    Proprietary data of clinical cases being used to develop case-based,

    optimized treatments to enhance outcomes and minimize costs for

    patients and payors

    Agility Health

    Proprietary Software System AgileRPM

    17

  • Cultural fit with Agility

    Ongoing management participation

    Strong, local reputation

    Retains Equity (actual or synthetic)

    Organic Growth Opportunities

    Typical Acquisition Criteria

    18

  • Public Peers: Sc

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