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Inspira Financial Inc. (TSX-V:LND) ("Inspira" or the "Company"),
a company focused on providing lending, billing and collection
solutions to the highly fragmented U.S. mental health and addiction
services market, today announced it has completed its strategic
review of its loan book. Additionally, the Company has established
its new management structure with the appointment of several
executives and the resignation of several members of the Board of
Directors.
The strategic review of the loan book is complete. The Company
has decided to retool its lending criteria by focusing on offering
loans to borrowers who have strategic importance to the Company.
Lending to strategic borrowers will increase gradually. As a
result, the Company expects the near term financial effects will be
to reduce its current credit receivables balance, increase its cash
on the balance sheet, and reduce revenues associated with lending.
Revenues from the billing and collection business are expected to
continue to grow over time.
The Company announced that Mike Olson has been promoted from
Chief Financial Officer (CFO) to Chief Executive Officer (CEO) and
Natalia Vakhitova is appointed interim CFO. Additionally, Dave
Costine and Marc Lavine have resigned from the Board of Directors
and Brian Chevalier-Jordan was appointed a non-executive Director.
Edward Brann will continue in his role as a Director and chair the
Committee for Corporate Strategy, which will work to create
strategies to optimize the return on the Company’s large cash
balance.
“This is an important step in our quest to realign this company
with the capital markets,” said Edward Brann, Director of Inspira.
“Today I can truly say that we have a new start. All of the
officers and directors from a year ago are no longer with the
Company. I want to welcome Brian to the Board as well as Natalia as
our interim CFO. I believe this team has the renewed sense of
urgency and focus that I have been working to establish in our new
culture. I will be stepping into an investment banker role for the
business and will put my energy toward finding additional ways to
increase shareholder value. I think we are in a strong position. We
have a good, albeit small, operation and a growing cash balance. I
am optimistic about our current strategy and believe Mike and his
team are the best option to expand on our lending, billing and
collection business.”
“I see a high demand market for lending, billing and collection
services in the U.S. addiction services industry,” said Mr. Olson,
newly appointed CEO of Inspira. “I want to assure shareholders that
we will be completing our audit shortly and I will remain focused
on seeing it complete. Secondly, while it will take several
quarters to optimize our technology platform and round out our
implementation team, I am very optimistic about the growth
prospects for this business line. While growth is a key goal, we
will also work to ensure we have operational profits in mind as a
priority. While this may reduce our ultimate growth rate in the
short run, I believe in the current capital market environment a
premium is placed on profits and I plan to ensure we have the
opportunity to earn that premium.”
Mike OlsonMr. Olson was previously the CFO of a healthcare
related startup, a Controller for PCH Treatment Centers and a
Controller for a medical laboratory (which was successfully
acquired by LabCorp). He began his finance career at The Walt
Disney Company, holds a degree from Eastern Washington University,
a graduate-level certificate from University of Washington and a
California CPA license.
Brian Chevalier-JordanMr. Chevalier-Jordan has more than 20
years of experience in marketing and sales, the majority of which
were spent in financial services. Since obtaining his MBA from UC
Berkeley in 2006, Brian has held roles as Cisco, Financial Engines,
and Yahoo!. For most of his career, Brian has focused on new
product development and sales enablement.
Natalia VakhitovaMs. Vakhitova joined Inspira Financial in the
finance department working directly with Mike Olson and the Board.
She holds a degree in accounting from the Engineering Economic
Academy in Russia. She has years of finance experience in the
addiction treatment industry.
Forward-Looking Statements
Certain statements contained in this press release constitute
"forward-looking information" as such term is defined in applicable
Canadian securities legislation. The words "may", "would", "could",
"should", "potential", "will", "seek", "intend", "plan",
"anticipate", "believe", "estimate", "expect" and similar
expressions as they relate to Inspira, Inspira expecting to reduce
its current credit receivables balance, increasing its cash on the
balance sheet reducing revenues associated with lending, and
revenues from the billing and collection business continuing to
grow over time, are intended to identify forward-looking
information. All statements other than statements of historical
fact may be forward-looking information. Such statements reflect
Inspira's current views and intentions with respect to future
events, and current information available to Inspira, and are
subject to certain risks, uncertainties and assumptions, including:
the success of Inspira's sales and marketing efforts effectively
growing the total client base; Inspira's ability to satisfy and
keep existing clients; management execution, hiring and maintaining
qualified staff, and understanding and achieving software
improvements within reasonable time frames and costs; the demand
for addiction treatment continuing to increase; the new service
line being complimentary to existing Inspira clients; Inspira being
successful in its integration of the billing company; Inspira's
clients maintaining revenue regardless of overall industry demand;
the successful recruitment of employee talent in Florida;
increasing total clients serviced resulting in a positive impact on
revenue; and Inspira being able to use the scale of multiple
clients and a larger operation to reduce costs. Material factors or
assumptions were applied in providing forward-looking information.
Many factors could cause the actual results, performance or
achievements that may be expressed or implied by such
forward-looking information to vary from those described herein
should one or more of these risks or uncertainties materialize.
These factors include changes in law, competition, litigation, the
ability to implement business strategies and pursue business
opportunities, state of the capital markets, the availability of
funds and resources to pursue operations, dependence on debt
markets and interest rates, demand for the lending products Inspira
offers at interest rates higher than at which Inspira can borrow, a
novel business model, granting of permits and licenses in a highly
regulated business, difficulty integrating newly acquired
businesses (including the billing company), risks of performance by
the target, new technologies, risk of billing irregularities by
borrowers, low profit market segments, risks associated with the
declaration and payment of dividends, including the discretion of
Inspira's Board of Directors to declare dividends, as well as
general economic, market and business conditions, as well as those
risk factors discussed or referred to in Inspira's annual
Management's Discussion and Analysis for the year ended February
29, 2016, filed with the securities regulatory authorities in
certain provinces of Canada and available at www.sedar.com. Should
any factor affect Inspira in an unexpected manner, or should
assumptions underlying the forward-looking information prove
incorrect, the actual results or events may differ materially from
the results or events predicted. Any such forward-looking
information is expressly qualified in its entirety by this
cautionary statement. Moreover, Inspira does not assume
responsibility for the accuracy or completeness of such
forward-looking information. The forward-looking information
included in this press release is made as of the date of this press
release and Inspira undertakes no obligation to publicly update or
revise any forward-looking information, other than as required by
applicable law. Unless otherwise indicated, all figures are in
Canadian dollars.
In addition to the foregoing, further litigation and
administrative actions, even if completely without merit, can be
expected to cause Inspira to continue to incur substantial
financial expenses to defend its actions. In addition, the
litigation may be expected to draw management resources that would
otherwise be used to grow and manage the company, and have the
effect of impairing or slowing the efforts of Inspira to execute on
its business plan. Inspira can offer no guidance on whether or how
long such proceedings will continue.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Inspira Financial Inc.
Edward Brann
Director
1 (844) 877-7562
IR@inspirafin.com
www.inspirafin.ca
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