Agiliti, Inc.

Good afternoon and welcome to Agility's first quarter 2021 earnings conference call. Today's call is being recorded and we have a located one hour for prepared remarks and Q&A. At this time, I would like to turn this conference over to Kate Kaiser, Vice President of Corporate Communication and Investor Relations at Agility. Thank you. You may begin.

Thank you, Laura, and good afternoon, everyone. Thank you for joining us on today's call as we provide an overview of Agility's results for the quarter ending March 31st, 2021. Before we begin, I'd like to remind you that during today's call, we'll be making statements that are forward-looking and consequently are subject to risks and uncertainties. Certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward-looking statements. Specific risk factors are detailed in our press release and our most recent SEC filings. which can be found in the investor section of our corporate website at agilityhealth.com. We'll also be referring to certain measures that are not calculated and presented in accordance with generally accepted accounting principles during this call. You can find a reconciliation of those measures to the nearest comparable gap measures and a description of why we use these measures in our press release and in the slide presentation we will use to facilitate today's discussions. If you'd like to download a copy of the presentation, please visit our website at agilityhealth.com, select the Investors section at the top of the screen, and then Events and Presentations. Finally, select the presentation titled Agility Q1 2021 Earnings Slides. Finally, and important to note, on April 22nd, 2021, Agility's registration statement on Form S-1 related to our initial public offering was declared effective by the SEC. And on April 23rd, 2021, our common stock began trading on the New York Stock Exchange under the symbol AGTI. The IPO closed on April 27th, 2021. The condensed consolidated financial statements as of March 31st, 2021, which we will review today, do not reflect the impact of our IPO. With that, I'll turn the call over to CEO Tom Leonard for his remarks on our first quarter.

Thanks, Kate, and good afternoon. Thank you for taking the time to join us as we review our results from the first quarter of 2021. As a newly public company, we're excited to continue sharing the agility story and the important work that we do is a vital part of our nation's healthcare infrastructure. I'd like to start today by taking a moment to recognize our extraordinary team. Throughout our more than 80 year history, we've been driven by a belief that every interaction has the power to change a life. That has never been more true than over the past year as COVID-19 affected our communities, our healthcare system, and each of us personally. From the very beginning of the pandemic, our teams worked side by side with clinicians in hospitals and health systems across the country, ensuring access to the patient-ready medical devices they needed to care for their patients. It's an honor to serve alongside more than 4,400 passionate, dedicated professionals doing work that truly makes a difference. Joining me on today's call is our Chief Financial Officer, Jim Pekarek, our President, Tom Benning, who leads our commercial operations, and Kate Kaiser, our Head of Corporate Communications and Investor Relations. Following the recent close of our IPO on April 27th, I'd like to begin today's call with a brief overview of our business, outlining the fundamentals of what we do and why we believe Agility's well-positioned to sustain our consistent above-market growth for years to come. To sum up Agility in a single phrase, we're the leading experts in the management, maintenance, and mobilization of regulated reusable medical devices. We ensure healthcare providers have the medical equipment they need delivered right to the patient's bedside and always with the confidence it's maintained to the highest industry standard. Today, we serve more than 7,000 US-based customers with one or more of our solutions, delivering an essential end-to-end service and all built on a peerless set of capabilities. We organize the work that we do for our customers into three distinct service lines. The first is equipment solutions. More commonly referred to as medical device rental, we provide access to medical devices to our customers to meet peak census needs or provide access to a high cost, low utilization device, which wouldn't otherwise make sense for our customers to own. Agility enjoys by far the largest medical device fleet in the country, owning more than a quarter million capital medical devices and related accessories. We generally focus on device categories, but we can wrap a differentiated service model around access to the device. For example, surgical lasers. We also provide a laser technician to support the surgeon in the use of the device during the procedure. Next is clinical engineering. This is our business in medical device repair and maintenance. It's our fastest growing business. It's in the largest market segment that we participate in. We repair and maintain virtually all of the medical equipment you'd expect to find at a hospital. We perform this work both at our customers' facilities as well as in our local service network. Finally, there's our onsite managed services solution. Our teams here work in hospital facilities, working shoulder to shoulder with clinicians, managing our customers' medical devices. With our onsite solution, clinicians never have to hunt for the devices that they need to care for their patients. We ensure those devices are patient ready and delivered right to the patient's bedside. We operate this service through a dedicated onsite team to perform these duties, and a proprietary software platform, which we integrate into our customers' hospital information systems and use to manage our team's workflow and optimize our customers' medical device utilization. What makes Agility stand apart is how we bring these three service lines together. Our three service lines seamlessly connect to form a comprehensive end-to-end solution that's based around our customers' workflow. and it's designed to bridge the gaps that results in waste and inefficiency. As seen through the eyes of our customers, Agility will manage and mobilize a provider's own medical equipment on site within their facilities. But then we process, repair, and maintain these devices, doing that work both on premise as well as offsite in our local service centers, a model which is unique to Agility. Finally, We closed the loop to deliver the lowest total cost of accessing the devices they need by providing supplemental device rental to support their peak needs or to provide access to specialized or low utilization devices. This service framework delivers a hard dollar financial return and clinical benefits. We improve equipment availability and on-patient device utilization. We reduce or eliminate unnecessary medical device rental, and we lower the cost of maintaining health systems-owned devices. Importantly, we also free up the capital and the operating expense that's too often tied up in the ownership of excess equipment. The benefits we deliver are both measurable and meaningful to our customers. Agility is the only company with the scale and the breadth of capabilities to optimize medical equipment utilization in this end-to-end process, whether it's across departments within an individual facility or scaling up to serve the largest delivery networks in the country. Now, in a moment, I'm going to invite Tom Benning to share some color on what we're seeing in the market and among our customers. But first, let me share my perspective on a few recent milestones. On March 19th, we closed our acquisition of Northfield Medical, a nationwide provider of surgical equipment repair and maintenance services. Integration of this business is already underway. We're excited to add Northfield's robust repair capabilities as a logical extension of our rapidly growing clinical engineering business. This merger also illustrates our general approach to M&A, which is to overlap and extend. This means that we look to build on our existing capabilities and to drive additional profitable volume to our at-scale national service infrastructure while always staying close to what we know and do best. While Agility's growth has been primarily organic, this team has completed a handful of small complementary acquisitions. Looking ahead, we'll continue to evaluate opportunistic tuck-in M&A to augment our strong organic growth profile. Second, as we described earlier, Agility completed an initial public offering of its common stock on the New York Stock Exchange on April 23rd. This represents an important milestone for this 82-year-old company, acknowledging both the business we built and the meaningful growth opportunity ahead of us. Following the close of our IPO, we directed proceeds to retire certain outstanding debt-related fees and expenses under the company's credit facilities. As Jim will review later on in the call, our pro forma leverage ratio is now 3.3 times, in line with the expectations we shared ahead of our IPO. Turning to our first quarter financials, I'm pleased to note that all results met the high end of the preliminary range we disclosed in our S-1 filing. Total revenue for the quarter was $235 million, representing a 31% increase from Q1 of 2020. Q1 adjusted EBITDA was $86 million, a 77% increase compared to Q1 of last year. And our adjusted earnings per share for the first quarter was $0.30, compared to an adjusted EPS of $0.05 for the prior year period. Jim will share additional detail on our Q1 financial performance, as well as our 2021 full-year financial outlook. For now, let me turn the call to our President, Tom Banning, to offer his perspective on our performance and the trends we're seeing in the market.