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Quipt Home Medical Corp.

Quipt Home Medical Corp.QIPT決算レポート

Nasdaq · ヘルスケア · サービス-その他健康及び関連サービス（その他）

Quipt Home Medical Corp is a U.S.-based home medical equipment provider specializing in respiratory care, sleep therapy supplies, and chronic disease management products. It serves patients with long-term health conditions, partners with healthcare providers and insurance payers across operating regions to deliver accessible in-home medical solutions.

What changed in Quipt Home Medical Corp.'s 10-K — 2024 vs 2025

Top changes in Quipt Home Medical Corp.'s 2025 10-K

289 paragraphs added · 261 removed · 194 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Quipt generally operates under a shared services model which results in obtaining cost efficiencies, technology improvements and synergies across the acquisitions and the various business units where possible. The Company is focused on the implementation of technology solutions for the acquired subsidiaries. Corporate Information Quipt was incorporated under the Business Corporations Act (Alberta) on March 5, 1997.
Quipt generally operates under a shared services model which results in obtaining cost efficiencies, technology improvements and synergies across the acquisitions and the various business units where possible. The Company is focused on the implementation of technology solutions for its acquired subsidiaries. Corporate Information Quipt was incorporated under the Business Corporations Act (Alberta) on March 5, 1997.
Each respiratory therapist is required to be state licensed, either as a Registered Respiratory Therapist and/or a Certified Respiratory Therapist. Additionally, the Company’s clinical team manages patients that use its services that range from nebulizers to invasive ventilation. The Company also employs a team of Assistive Technology Professionals (“ATP”) who provide customized mobility and bath safety equipment for patients.
Each respiratory therapist is required to be state licensed, either as a Registered Respiratory Therapist and/or a Certified Respiratory Therapist. Additionally, the Company’s clinical team manages patients that use its services ranging from nebulizers to invasive ventilation. The Company also employs a team of Assistive Technology Professionals (“ATP”) who provide customized mobility and bath safety equipment for patients.
Significant Customers For the years ended September 30, 2024 and 2023, the Company had no customers that accounted for 10% or more of its consolidated revenue. The Company earns revenues by seeking reimbursement from government agencies (such as Medicare and Medicaid) and private health insurance companies.
Significant Customers For the years ended September 30, 2025 and 2024, the Company had no customers that accounted for 10% or more of its consolidated revenue. The Company earns revenues by seeking reimbursement from government agencies (such as Medicare and Medicaid) and private health insurance companies.
Changes to Contracts CMS policies of health insurance for Medicare in the US may affect the amount of revenue the Company receives. Apart from Medicare reimbursement, the majority of the Company’s revenues are derived from the fee-for-service pricing guidelines set by numerous payors like private health insurance companies and other governmental agencies like Medicaid that it contracts with.
Changes to Payor Contracts CMS’s health insurance policies for Medicare in the US may affect the amount of revenue the Company receives. Apart from Medicare reimbursement, the majority of the Company’s revenues are derived from the fee-for-service pricing guidelines set by numerous payors like private health insurance companies and other governmental agencies like Medicaid that the Company contracts with.
We make available on our website, free of charge, copies of these reports and other information as soon as ‎reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
We make available on our website, free of charge, copies of 7 Table of Contents these reports and other information as soon as ‎reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
As the company is a US healthcare provider, it also requires employees in its revenue cycle management team to have specialized knowledge regarding processing claims and getting reimbursement for the products that the Company provides. Competitive Conditions The Company has physical operations in 26 states.
As the company is a US healthcare provider, it also requires employees in its revenue cycle management team to have specialized knowledge regarding processing claims and reimbursement for the Company’s products. Competitive Conditions The Company has physical operations in 27 states.
These pricing guidelines are subject to change at the discretion of these payor contracts. 7 Table of Contents Employees As of September 30, 2024, the Company had a total of approximately 1,200 employees. In addition, the Company has staff augmentation arrangements with global partners.
These pricing guidelines are subject to change at the discretion of these payor contracts. Employees As of September 30, 2025, the Company had a total of approximately 1,600 employees. In addition, the Company has staff augmentation arrangements with global partners.
Securities and ‎Exchange Commission (the “SEC”) our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports 6 Table of Contents ‎on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange ‎Act.
Securities and ‎Exchange Commission (the “SEC”) our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports ‎on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities and Exchange ‎Act of 1934, as amended (the “Exchange Act”).
The reports are also ‎available at www.sec.gov.‎ Specialized Skills and Knowledge The Company requires some of its employees to have specific skills, knowledge, and background to perform some key tasks and functions, such as patient care, patient set-up, etc. For example, the Company employs a team of respiratory therapists to provide these services.
Specialized Skills and Knowledge The Company requires some of its employees to have specific skills, knowledge, and background to perform some key tasks and functions, such as patient care and patient set-up, among others. For example, the Company employs a team of respiratory therapists to provide services.
New Products The Company continually explores and considers additional products and services that would complement the products and services already offered by its subsidiaries that would serve the current patient population and/or help the Company expand and enter into new segments and serve new patients in its existing service areas.
Accordingly, there can be no assurance that the Company will be able to grow its operations organically to meet the competitive environment. 8 Table of Contents New Products The Company continually explores and considers additional products and services that would complement the products and services already offered by its subsidiaries that would serve the current patient population and/or help the Company to expand and enter into new segments and serve new patients in its existing service areas.
Leveraging compliance technology, the company enhances patient compliance with ongoing training and follow-up, while streamlining the delivery and setup of equipment and devices to improve speed and ease for patients.
Quipt’s growth plan focuses on aggregating patients in existing or complementary markets, both through acquisitions and by capturing market share from competitors. Through leveraging compliance technology, the company enhances patient compliance with ongoing training and follow-up, while streamlining the delivery and setup of equipment and devices to improve speed and ease for patients.
The Company’s comprehensive solutions support patients dealing with heart and pulmonary diseases, sleep apnea, reduced mobility, and other chronic health challenges. Currently, the Company serves patients across 26 states in the US. Quipt’s primary business objective is to create shareholder value by becoming one of the largest providers of in-home respiratory solutions in the US.
The Company’s comprehensive solutions support patients dealing with heart and pulmonary diseases, sleep apnea, reduced mobility, and other chronic health challenges. Currently, the Company serves patients across 27 states in the US. On December 14, 2025, the Company entered into an Arrangement Agreement (the “Arrangement Agreement”) to be acquired by 1567208 B.C.
This will be achieved through a dual strategy of driving organic growth in its core business and expanding its geographical footprint via strategic acquisitions of DME/HME providers. Quipt’s growth plan focuses on aggregating patients in existing or complementary markets, both through acquisitions and by capturing market share from competitors.
Quipt’s primary business objective is to create shareholder value by becoming one of the largest providers of in-home respiratory solutions in the US. Quipt aims to achieve this through a dual strategy of driving organic growth in its core business and expanding its geographical footprint via strategic acquisitions of DME/HME providers.
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Accordingly, there can be no assurance that the Company will be able to grow its operations organically to meet the competitive environment.
Added
Ltd. and REM Aggregator, LLC (collectively, “Purchaser”), entities affiliated with Kingswood Capital Management, LP (“Kingswood”). Under the terms of the Arrangement Agreement, Purchaser will acquire all of the issued and outstanding common shares of the Company (the “Shares”) pursuant to a Plan of Arrangement (the Arrangement) under the Business Corporations Act (British Columbia) (the BCBCA) for US$3.65 per Share.
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At the effective time of the Arrangement (the “Effective Time”), each Share, other than any Shares exchanged by shareholders who may properly exercise dissent rights under the BCBCA, will be deemed to be transferred to Purchaser in consideration for the right to receive a cash payment from the Purchaser in the amount equal to US$3.65, without interest.
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The transaction is expected to close during the first half of 2026, subject to customary closing conditions, including receipt of shareholder, regulatory, and court approvals. Upon completion of the transaction, the Company will become a privately-held company.
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If the Arrangement is consummated, the Shares will be de-listed from The Nasdaq Capital Market and the Toronto Stock Exchange and de-registered under the Securities Exchange Act of 1934, as amended, and the Company will cease to be a Canadian “reporting issuer”, as soon as practicable following the Effective Time.
Added
Pursuant to the terms of an equity commitment letter entered into by and between Purchaser and Kingswood and delivered to the Company at the signing of the Arrangement Agreement (the “ECL”), Purchaser has obtained equity commitments from Kingswood for the transactions contemplated by the Arrangement Agreement, the aggregate proceeds of which Purchaser will use to fund the consideration payable at closing and thereafter, all fees, costs, expenses and other amounts payable by Purchaser in connection with the transactions contemplated by the transactions contemplated by the Arrangement Agreement (the Commitment).
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The ECL includes a guarantee from Kingswood to the Company, on the terms and conditions set forth in the ECL.
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Each option exercisable to acquire one or more Shares from the Company (a Company Option), outstanding immediately prior to the Effective Time (whether vested or unvested) will be deemed to be unconditionally vested and exercisable and will, without any further action by or on behalf of a holder of the Company Option, be deemed to be surrendered and transferred by such holder to the Company in consideration for the right to receive a cash payment from the Company in an amount equal to the excess, if any, of US$3.65 over the exercise price of such option, less any amounts the Company 6 Table of Contents is required to withhold for taxes, without interest.
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Any option for which the exercise price is equal to or greater than US$3.65 will be cancelled for no consideration.
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Each of the Company’s restricted share units (a Company RSU) outstanding immediately prior to the Effective Time (whether vested or unvested) will, without any further action by or on behalf of the holder of any such Company RSU, be deemed to be transferred by such holder to the Company in consideration for the right to receive a cash payment from the Company in the amount equal to US$3.65, less any amounts the Company is required to withhold for taxes, without interest.
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The Arrangement Agreement also provides customary restrictions on the Company’s ability to solicit alternative acquisition proposals from third parties and engage in discussions or negotiations with third parties regarding such proposals.
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Notwithstanding these restrictions, the Company may under certain circumstances provide information to and participate in discussions or negotiations with third parties with respect to an unsolicited acquisition proposal that constitutes or could reasonably be expected to constitute or lead to a Superior Proposal (as defined in the Arrangement Agreement).
Added
The reports are also ‎available at www.sec.gov.‎ Recent Transactions On July 1, 2025, through QHM Holdings Inc., we acquired 100% of Mediserve Medical Equipment of Kingsport, Inc. (“Mediserve”). Mediserve is a Tennessee-based company with operations in two states in the same industry as the Company.
Added
The purchase price was $2,616,000, comprised of $2,466,000 in cash at closing to the sellers, plus $150,000, the present value of a $160,000 holdback. The cash at closing was paid from cash on hand.
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Effective September 1, 2025, through QHM Holdings Inc., we acquired a 60% membership interest in IRB Medical Equipment, LLC, doing business as Hart Medical Equipment (“Hart”), a Michigan limited liability company in the same industry as us.
Added
The transaction was completed pursuant to an Equity Purchase Agreement dated August 11, 2025 (the “Hart Purchase Agreement”) among Quipt, Hart, and Hart HoldCo, LLC (the “Hart Seller”). We acquired our 60% interest through the payment of $17,372,000 in cash to the Hart Seller and the repayment of $3,261,000 of Hart indebtedness at closing.
Added
The purchase was funded with borrowings under our senior credit facility (the “Facility”). Prior to closing, 100% of the equity interests in Hart were contributed to the Hart Seller by its previous owners.
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Pursuant to the Hart Purchase Agreement, we purchased 60% of the membership interests of Hart directly from the Hart Seller, and the Hart Seller retained the remaining 40% membership interests.
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In connection with the transaction, the parties entered into an administrative support services agreement, and Hart’s operating agreement was amended and restated pursuant to the Sixth Amended and Restated Operating Agreement to provide for the operation of Hart as a joint venture between us and the Hart Seller.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Risks Related to Our Business and Industry Reliance on relatively few suppliers for the majority of Quipt’s patient service equipment and supplies could adversely affect its ability to operate. Quipt currently relies on a relatively small number of suppliers to provide it with the majority of its patient service equipment and supplies.
Risks Related to Our Business and Industry Reliance on relatively few suppliers for the majority of Quipt’s patient service equipment and supplies could adversely affect Quipt’s ability to operate. Quipt currently relies on a relatively small number of suppliers to provide it with the majority of its patient service equipment and supplies.
Quipt’s growth and profitability depend in large part on referrals from acute care hospitals, sleep laboratories, pulmonologist and endocrinologist offices, skilled nursing facilities, hospice operators and other patient referral sources in the communities served by Quipt, its ability to establish and maintain close working relationships with such patient referral sources and to increase awareness and acceptance of the benefits of inpatient rehabilitation, home health, and hospice care by its referral sources and their patients.
Quipt’s growth and profitability depend in large part on referrals from acute care hospitals, sleep laboratories, pulmonologist and endocrinologist offices, skilled nursing facilities, hospice operators and other patient referral sources in the communities served by Quipt, its ability to establish and maintain close working relationships with such patient referral sources and its ability to increase awareness and acceptance of the benefits of inpatient rehabilitation, home health, and hospice care by its referral sources and their patients.
Any decision made by any of such directors and ‎officers involving Quipt should be made in accordance with their duties and obligations to deal fairly and in ‎good faith with a view to the best interests of Quipt and its shareholders.‎ Quipt conducts all of its operations through foreign subsidiaries. Quipt conducts all its operations through its US subsidiaries.
Any decision made by any of such directors and ‎officers involving Quipt should be made in accordance with their duties and obligations to deal fairly and in ‎good faith with a view to the best interests of Quipt and its shareholders.‎ Quipt conducts all of its operations through foreign subsidiaries in the US.
Quipt is subject to US federal and state healthcare fraud and abuse and false claims laws and regulations, the prosecutions under which have increased in recent years and Quipt may become subject to such litigation, and if Quipt is unable to comply or has not fully complied with such laws, it could face substantial penalties .
Quipt is subject to US federal and state healthcare fraud and abuse and false claims laws and regulations, under which prosecutions have increased in recent years and Quipt may become subject to such litigation, and if Quipt is unable to comply or has not fully complied with such laws, it could face substantial penalties .
Quipt may be adversely affected if it is unable to maintain current levels of collectability and by the deterioration of the financial condition of Quipt’s payors and disputes with third parties could have a significant negative impact on its financial condition and results of operations.
Quipt may be adversely affected if it is unable to maintain current levels of collectability and by the deterioration of the financial condition of Quipt’s payors and disputes with third parties could have a significant negative impact on Quipt’s financial condition and results of operations.
Among other things, these provisions: ● allow the authorized number of our directors to be changed only by resolution of our board of directors; ● limit the manner in which shareholders can remove directors from the board; ● establish advance notice requirements for shareholder proposals that can be acted on at shareholder meetings and nominations to our board of directors; ● require that shareholder actions must be effected at a duly called shareholder meeting unless the requisite written consent for such actions is obtained in accordance with the Business Corporations Act (British Columbia); ● ‎authorize our board of directors to issue shares without shareholder approval, which could be used to institute a “poison pill” that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by our board of directors; and ● require the approval of the holders of at least two-thirds of the votes that all our shareholders would be entitled to cast to amend or repeal certain provisions of our constating documents.
Among other things, these provisions: ● allow the authorized number of our directors to be changed only by resolution of our board of directors; ● limit the manner in which shareholders can remove directors from the board; ● establish advance notice requirements for shareholder proposals that can be acted on at shareholder meetings and nominations to our board of directors; 32 Table of Contents ● require that shareholder actions must be effected at a duly called shareholder meeting unless the requisite written consent for such actions is obtained in accordance with the Business Corporations Act (British Columbia); ● ‎authorize our board of directors to issue shares without shareholder approval, which could be used to institute a “poison pill” that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by our board of directors; and ● require the approval of the holders of at least two-thirds of the votes that all our shareholders would be entitled to cast to amend or repeal certain provisions of our constating documents.
Factors affecting the trading price of our Common Shares may include: ● actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us; ● changes in the market’s expectations about our operating results; 28 Table of Contents ● our operating results failing to meet the expectation of securities analysts, investors or our guidance in a particular period; ● changes in financial estimates and recommendations by securities analysts concerning Quipt or the home medical equipment industry in general; ● operating and stock price performance of other companies that investors deem comparable to us; ● our ability to market new and enhanced products on a timely basis; ● changes in laws and regulations affecting our business; ● our ability to meet compliance requirements; ● commencement of, or involvement in, litigation involving us; ● inability to quickly remediate material weaknesses or the continued identification of material weaknesses in internal control over financial reporting; ● changes in our capital structure, such as future issuances of securities or the incurrence of additional debt; ● the volume of shares of our Common Shares available for public sale; ● any major change in our board of directors or management; ● sales of substantial amounts of Common Shares by our directors, executive officers or significant shareholders or the perception that such sales could occur; and ● general economic and political conditions such as recessions, interest rates, fuel prices, international currency fluctuations and acts of war or terrorism, including the war in Ukraine and the ongoing conflict in the Middle East.
Factors affecting the trading price of our Common Shares may include: ● actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us; ● changes in the market’s expectations about our operating results; ● our operating results failing to meet the expectation of securities analysts, investors or our guidance in a particular period; ● changes in financial estimates and recommendations by securities analysts concerning Quipt or the home medical equipment industry in general; ● operating and stock price performance of other companies that investors deem comparable to us; ● our ability to market new and enhanced products on a timely basis; ● changes in laws and regulations affecting our business; ● our ability to meet compliance requirements; ● commencement of, or involvement in, litigation involving us; ● inability to quickly remediate material weaknesses or the continued identification of material weaknesses in internal control over financial reporting; ● changes in our capital structure, such as future issuances of securities or the incurrence of additional debt; ● the volume of shares of our Common Shares available for public sale; ● any major change in our board of directors or management; ● sales of substantial amounts of Common Shares by our directors, executive officers or significant shareholders or the perception that such sales could occur; and ● general economic and political conditions such as tariffs, recessions, interest rates, fuel prices, international currency fluctuations and acts of war or terrorism, including the war in Ukraine and the ongoing conflict in the Middle East.
Payors may disallow Quipt’s requests for reimbursement based on determinations that certain costs are not reimbursable or reasonable because either adequate or additional documentation was not provided or because certain services were not covered or considered medically necessary.
Payors may disallow Quipt’s requests for reimbursement based on determinations that certain costs are not reimbursable or reasonable because either adequate or additional documentation was not provided or because certain items or services were not covered or considered medically necessary.
These restrictions may interfere with Quipt’s ability to obtain additional advances under its existing credit facility or to obtain new financing or to engage in other business activities, which may inhibit Quipt’s ability to grow its business and increase revenue.
These restrictions may interfere with Quipt’s ability to obtain additional advances under its existing Facility or to obtain new financing or to engage in other business activities, which may inhibit Quipt’s ability to grow its business and increase revenue.
Quipt monitors foreign currency exposures and ‎from time to time could authorize the use of derivative financial instruments such as forward foreign exchange ‎contracts to economically hedge a portion of foreign currency fluctuations.‎ Based on the exposure of Canadian cash at September 30, 2024, depreciation or appreciation of the Canadian dollar ‎against the US dollar (“$”) could result in a significant effect on net income or loss.
Quipt monitors foreign currency exposures and ‎from time to time could authorize the use of derivative financial instruments such as forward foreign exchange ‎contracts to economically hedge a portion of foreign currency fluctuations.‎ Based on the exposure of Canadian cash at September 30, 2025, depreciation or appreciation of the Canadian dollar ‎against the US dollar (“$”) could result in a significant effect on net income or loss.
Any failure, or perceived failure, by Quipt or any of its third-party partners or 23 Table of Contents service providers to comply with privacy policies or federal or state privacy or consumer protection-related laws, regulations, industry self-regulatory principles, industry standards or codes of conduct, regulatory guidance, orders to which they may be subject, or other legal obligations relating to privacy or consumer protection, could adversely affect Quipt’s reputation, brand and business, and may result in claims, proceedings or actions against Quipt by governmental entities, consumers, users, suppliers or others.
Any failure, or perceived failure, by Quipt or any of its third-party partners or service providers to comply with privacy policies or federal or state privacy or consumer protection-related laws, regulations, industry self-regulatory principles, industry standards or codes of conduct, regulatory guidance, orders to which they may be subject, or other legal obligations relating to privacy or consumer protection, could adversely affect Quipt’s reputation, brand and business, and may result in claims, proceedings or actions against Quipt by governmental entities, consumers, users, suppliers or others.
These ‎risks include:‎ ● compliance with laws of the US that apply to Quipt’s US operations, including lawful access, privacy ‎laws and anti-corruption laws;‎ ● instability in economic or political conditions, including inflation, recession and political uncertainty;‎ ● potential adverse tax consequences; and ● litigation in US courts.‎ In addition, Quipt is exposed to foreign exchange risk.
These ‎risks include:‎ ● compliance with US laws that apply to Quipt’s US operations, including lawful access, privacy ‎laws and anti-corruption laws;‎ ● instability in economic or political conditions, including inflation, recession and political uncertainty;‎ ● potential adverse tax consequences; and ● litigation in US courts.‎ In addition, Quipt is exposed to foreign exchange risk.
If we are not able to maintain internal controls and procedures in accordance with the requirements of applicable securities laws, rules, and regulations, including, without limitation, Section 404 in a timely manner or with adequate compliance, we may not be able to conclude that our internal control over financial reporting is effective, which may subject us to adverse regulatory consequences and could harm investor confidence and the market price of our Common Shares.
If we are not able to maintain internal controls and procedures in accordance with the requirements of applicable securities laws, rules, and regulations, including, without limitation, Section 404 in a timely manner or with adequate 29 Table of Contents compliance, we may not be able to conclude that our internal control over financial reporting is effective, which may subject us to adverse regulatory consequences and could harm investor confidence and the market price of our Common Shares.
The ability of such subsidiaries to make payments to their parent companies may be constrained by the ‎following factors: the level of taxation, particularly corporate profits and withholding taxes, in the jurisdiction in which ‎each subsidiary operates; and the introduction of exchange controls or repatriation restrictions or the availability of ‎hard currency to be repatriated.‎ Quipt’s revenue is generated from operations in the US and exposed to foreign exchange risk, which may negatively affect Quipt’s results of operations.
The ability of such subsidiaries to make payments to their parent companies may be constrained by the ‎following factors: the level of taxation, particularly corporate profits and withholding taxes, in the jurisdiction in which ‎each subsidiary operates; and the introduction of exchange controls or repatriation restrictions or the availability of ‎hard currency to be repatriated.‎ 18 Table of Contents Quipt’s revenue is generated from operations in the US and is exposed to foreign exchange risk, which may negatively affect Quipt’s results of operations.
Demand may outstrip supply, leading to equipment shortages. ‎If Quipt cannot obtain the patient service equipment and supplies it currently uses, or alternatives at similar or favorable prices, Quipt’s ability to provide such products may be severely impacted, which could have an adverse effect on its business, financial condition, results of operations, cash flow, capital resources and liquidity.
Demand may outstrip supply, leading to equipment shortages. ‎If Quipt cannot obtain the patient service equipment and 9 Table of Contents supplies it currently uses, or alternatives at similar or favorable prices, Quipt’s ability to provide such products may be severely impacted, which could have an adverse effect on its business, financial condition, results of operations, cash flow, capital resources and liquidity.
In addition, Quipt’s outsourced functions may be negatively impacted by any number of factors, including: political unrest; public health crises; social unrest; cyber-attacks; terrorism; war; vandalism; currency fluctuations; changes to the laws of India, the Philippines, the US or any other jurisdictions in which Quipt does business or outsources operations; or increases in the cost of labor and supplies in India and the Philippines or any other jurisdiction in which Quipt outsources any portion of its internal or other business functions.
In addition, Quipt’s outsourced functions may be negatively impacted by any number of factors, including: 15 Table of Contents political unrest; public health crises; social unrest; cyber-attacks; terrorism; war; vandalism; currency fluctuations; changes to the laws of India, the Philippines, the US or any other jurisdictions in which Quipt does business or outsources operations; or increases in the cost of labor and supplies in India and the Philippines or any other jurisdiction in which Quipt outsources any portion of its internal or other business functions.
CMS currently requires a six-year “lookback period,” for reporting and returning overpayments. Quipt cannot currently predict the adverse impact, if any, that these audits, determinations, methodologies and interpretations might have on its financial condition and results of operations. Significant reimbursement reductions and/or exclusion from markets or product lines could adversely affect Quipt.
CMS currently requires a six-year “lookback period,” for reporting and returning overpayments. 23 Table of Contents Quipt cannot currently predict the adverse impact, if any, that these audits, determinations, methodologies and interpretations might have on its financial condition and results of operations. Significant reimbursement reductions and/or exclusion from markets or product lines could adversely affect Quipt.
On December 28, 2021, CMS extended the temporary 50/50 blended rate for rural and noncontiguous non-competitive bidding areas after the public health emergency. This 50/50 blended rate was continued in the 2023 DMEPOS Fee Schedule.
On December 28, 2021, CMS extended the temporary 50/50 blended rate for rural and noncontiguous non-competitive bidding areas after the public health emergency. This 50/50 blended rate was continued in the 2023 DMEPOS Fee Schedule through December 31, 2023.
Quipt may not generate sufficient cash flow from operations to cover required interest, principal and lease payments. In addition, Quipt’s current indebtedness contains restrictive covenants and require Quipt to maintain or satisfy specified coverage tests.
Quipt may not generate sufficient cash flow from operations to cover required interest, principal and lease payments. In addition, Quipt’s current indebtedness contains restrictive covenants and requires Quipt to maintain or satisfy specified coverage tests.
In addition, the prevalent use of 9 Table of Contents mobile devices that access confidential information increases the risk of data security breaches, which could lead to the loss of confidential information or other intellectual property. Quipt or its third-party vendors may experience cybersecurity and other breach incidents, including such incidents that remain undetected for an extended period.
In addition, the prevalent use of mobile devices that access confidential information increases the risk of data security breaches, which could lead to the loss of confidential information or other intellectual property. Quipt or its third-party vendors may experience cybersecurity and other breach incidents, including such incidents that remain undetected for an extended period.
Even an unsuccessful challenge of Quipt’s phone, email or SMS text practices by its consumers, regulatory authorities or other third parties could result in negative publicity and could require a costly response from and defense by Quipt. Quipt may be adversely affected by global climate change or by legal, regulatory or market responses to such change.
Even an unsuccessful challenge of Quipt’s phone, email or SMS text practices by its consumers, regulatory authorities or other third parties could result in negative publicity and could require a costly response from and defense by Quipt. 26 Table of Contents Quipt may be adversely affected by global climate change or by legal, regulatory or market responses to such change.
Since 2012, CMS has 20 Table of Contents also maintained a list of categories of DMEPOS items that require face-to-face encounters with practitioners and written orders before the DMEPOS supplier may furnish the items to beneficiaries. In a final rule issued in 2019, CMS combined and harmonized the two lists to create a single unified list (the “Master List”).
Since 2012, CMS has also maintained a list of categories of DMEPOS items that require face-to-face encounters with practitioners and written orders before the DMEPOS supplier may furnish the items to beneficiaries. In a final rule issued in 2019, CMS combined and harmonized the two lists to create a single unified list (the “Master List”).
Labor shortages may lead to a significant increase in competition throughout the industry to attract and retain talent and lead to increased labor costs. 8 Table of Contents Quipt’s failure to recruit and retain qualified employees, or to control its labor costs, could have a material adverse effect on its business, financial position, results of operations, and cash flows.
Labor shortages may lead to a significant increase in competition throughout the industry to attract and retain talent and lead to increased labor costs. Quipt’s failure to recruit and retain qualified employees, or to control its labor costs, could have a material adverse effect on its business, financial position, results of operations, and cash flows.
Quipt’s business can be affected by a number of factors that are beyond its control, such as general geopolitical, economic and business conditions, including slower economic growth, disruptions in financial markets, economic downturns in the form of either contained or widespread recessionary conditions, inflation, elevated unemployment levels, sluggish or uneven economic recovery, government actions impacting trade agreements including the imposition of trade restrictions such as tariffs and retaliatory counter measures, government deficit reduction, tax legislation increasing the federal corporate income tax rates, natural and other disasters, public health crises affecting the operations of Quipt or its customers or suppliers, staffing shortages, production slowdowns or stoppages, raw material shortages and disruptions in delivery systems.
Quipt’s business can be affected by a number of factors that are beyond its control, such as general geopolitical, economic, and business conditions, including slower economic growth, disruptions in financial markets, economic downturns in the form of either contained or widespread recessionary conditions, inflation, elevated unemployment levels, sluggish or uneven economic recovery, government actions impacting trade agreements, including the imposition of trade restrictions such as tariffs and retaliatory counter measures, government deficit reduction, tax legislation increasing the federal corporate income tax rates, natural and other disasters, public health crises affecting the operations of Quipt or its customers or suppliers, staffing shortages, product shortages, and disruptions in delivery systems.
Quipt’s failure to successfully outsource certain of its business functions could materially adversely affect its business, results of operations, and financial condition. 14 Table of Contents Quipt’s ability to successfully operate its business is largely dependent upon the efforts of key personnel of Quipt, including senior management, the loss of any of whom could negatively impact Quipt’s operations and financial results.
Quipt’s failure to successfully outsource certain of its business functions could materially adversely affect its business, results of operations, and financial condition. Quipt’s ability to successfully operate its business is largely dependent upon the efforts of key personnel of Quipt, including senior management, the loss of any of whom could negatively impact Quipt’s operations and financial results.
There can be no assurance that this D&O coverage will be sufficient to cover the costs of the events that may lead to its 16 Table of Contents invocation, in which case, there could be an adverse impact on Quipt’s financial condition, should such an unforeseen event occur.
There can be no assurance that this D&O coverage will be sufficient to cover the costs of the events that may lead to its invocation, in which case, there could be an adverse impact on Quipt’s financial condition, should such an unforeseen event occur.
If CMS adds additional products to the Master List, expands the list of items subject to prior authorization, or expands face-to-face encounter requirements or provisions requiring a written order prior to delivery, these changes may adversely impact Quipt’s revenue, financial condition and results from operations.
If CMS adds additional 22 Table of Contents products to the Master List, expands the list of items subject to prior authorization, or expands face-to-face encounter requirements or provisions requiring a written order prior to delivery, these changes may adversely impact Quipt’s revenue, financial condition and results from operations.
Additional information on the risks, assumptions and uncertainties are found in this Annual Report on Form 10-K and in ‎certain of the documents incorporated by reference herein under the heading “ Caution Regarding ‎Forward-Looking Statements ”.‎ 30 Table of Contents Item 1B. Unresolved Staff Comments. None.
Additional information on the risks, assumptions and uncertainties are found in this Annual Report on Form 10-K and in ‎certain of the documents incorporated by reference herein under the heading “ Caution Regarding ‎Forward-Looking Statements ”.‎ Item 1B. Unresolved Staff Comments. None.
Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors, such as estimates of a reporting unit’s fair value, including the revenue growth rates, discount 25 Table of Contents rate, and control premium used to estimate the reporting unit’s fair value, and judgment about impairment triggering events.
Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors, such as estimates of a reporting unit’s fair value, including the revenue growth rates, discount rate, and control premium used to estimate the reporting unit’s fair value, and judgment about impairment triggering events.
Additionally, the continued expansion of its business through the acquisition of existing facilities, expansion of existing facilities and construction of new facilities may require additional capital, particularly if Quipt were to accelerate its acquisition and expansion plans. Financing may not be available or may be available only on terms that are not favorable.
Additionally, the continued expansion of its business through the 27 Table of Contents acquisition of existing facilities, expansion of existing facilities and construction of new facilities may require additional capital, particularly if Quipt were to accelerate its acquisition and expansion plans. Financing may not be available or may be available only on terms that are not favorable.
Costs and potential problems and interruptions associated with any such unauthorized access or the implementation of new or upgraded systems and technology or with maintenance or adequate support of existing systems and technology, including systems and technology intended to protect against unauthorized access, also could disrupt or reduce the efficiency of Quipt’s operations.
Costs and potential problems and interruptions associated with any such unauthorized access or the implementation of new or upgraded systems and 11 Table of Contents technology or with maintenance or adequate support of existing systems and technology, including systems and technology intended to protect against unauthorized access, also could disrupt or reduce the efficiency of Quipt’s operations.
Additionally, as a result of these investigations, healthcare providers and entities may face litigation or have to agree to settlements that can include monetary penalties and onerous compliance and reporting requirements as part of a consent decree or corporate integrity agreement.
Additionally, as a result of these investigations, healthcare providers and entities may face litigation or have to agree to settlements that can include monetary penalties and onerous compliance and reporting requirements as part of a consent 21 Table of Contents decree or corporate integrity agreement.
Quipt has not employed any ‎foreign currency hedging programs. Risks Related to Regulation Quipt’s revenue could be impacted by federal and state changes to reimbursement and other Medicaid and Medicare policies. Quipt derived approximately 32% and 33% of its net revenue for the years ended September 30, 2024 and 2023, respectively, from Medicare and various state-based Medicaid programs.
Quipt has not employed any ‎foreign currency hedging programs. Risks Related to Regulation Quipt’s revenue could be impacted by federal and state changes to reimbursement and other Medicaid and Medicare policies. Quipt derived approximately 31% and 32% of its net revenue for the years ended September 30, 2025 and 2024, respectively, from Medicare and various state-based Medicaid programs.
Several equipment manufacturers are ‎pursuing a strategy of vertical integration and should Quipt ever need to order equipment from those ‎manufacturers, such equipment may not be available on favorable terms.‎ Supply chain disruptions and economy-wide labor shortages in the U.S. could negatively impact Quipt’s businesses.
Equipment manufacturers may pursue a strategy of vertical integration and should Quipt ever need to order equipment from those ‎manufacturers, such equipment may not be available on favorable terms.‎ Supply chain disruptions and economy-wide labor shortages in the U.S. could negatively impact Quipt’s businesses.
If conditions in the global economy, U.S. economy or other key vertical or geographic markets are weak or uncertain, Quipt could experience material adverse impacts on its revenue, financial condition and results of operations.
If conditions in the global economy, US economy, or other key vertical or geographic markets are weak or uncertain, Quipt could experience material adverse impacts on its revenue, financial condition, and results of operations.
As participants in the healthcare industry, Quipt may periodically be subject to lawsuits, some of which may involve large claims and significant costs to defend, such as mass tort or other class actions.
As a participant in the healthcare industry, Quipt may periodically be subject to lawsuits, some of which may involve large claims and significant costs to defend, such as mass tort or other class actions.
The HITECH Act included notification requirement for breaches of patient-identifiable health information, restricts certain disclosures and sales of patient-identifiable health information and provides a tiered system for civil monetary penalties for HIPAA violations. HIPAA also provides for criminal penalties.
The HITECH 25 Table of Contents Act included notification requirement for breaches of patient-identifiable health information, restricts certain disclosures and sales of patient-identifiable health information and provides a tiered system for civil monetary penalties for HIPAA violations. HIPAA also provides for criminal penalties.
Specific integration risks relating to the acquisition of other companies by Quipt may include: ● difficulties related to combining previously separate businesses into a single unit, including patient transitions, product and service offerings, distribution and operational capabilities and business cultures; ● availability of financing to the extent needed to fund acquisitions; ● customer loss and other general business disruption; ● managing the integration process while completing other independent acquisitions or dispositions; ● diversion of management’s attention from day-to-day operations; ● assumption of liabilities of an acquired business, including unforeseen or contingent liabilities or liabilities in excess of the amounts estimated; ● failure to realize anticipated benefits and synergies, such as cost savings and revenue enhancements; 15 Table of Contents ● potentially substantial costs and expenses associated with acquisitions and dispositions; ● failure to retain and motivate key employees; ● difficulties in establishing and applying Quipt’s internal control over financial reporting and disclosure controls and procedures to an acquired business; ● obtaining necessary regulatory licenses and payor-specific approvals, which may impact the timing of when Quipt is to bill and collect for services rendered; ● Quipt’s ability to transition patients in a timely manner may impact Quipt’s ability to collect amounts for services rendered; ● Quipt’s estimates for revenue accruals during the integration of acquisitions may require adjustments in future periods as the transition of patient information is finalized; and ● delays in obtaining new government and commercial insurance payor identification numbers for acquired branches, resulting in a slowdown and/or loss of associated revenue.
There can be no assurance that any future acquisitions, if consummated, will result in further growth. 16 Table of Contents Specific integration risks relating to the acquisition of other companies by Quipt may include: ● difficulties related to combining previously separate businesses into a single unit, including patient transitions, product and service offerings, distribution and operational capabilities and business cultures; ● availability of financing to the extent needed to fund acquisitions; ● customer loss and other general business disruption; ● managing the integration process while completing other independent acquisitions or dispositions; ● diversion of management’s attention from day-to-day operations; ● assumption of liabilities of an acquired business, including unforeseen or contingent liabilities or liabilities in excess of the amounts estimated; ● failure to realize anticipated benefits and synergies, such as cost savings and revenue enhancements; ● potentially substantial costs and expenses associated with acquisitions and dispositions; ● failure to retain and motivate key employees; ● difficulties in establishing and applying Quipt’s internal control over financial reporting and disclosure controls and procedures to an acquired business; ● obtaining necessary regulatory licenses and payor-specific approvals, which may impact the timing of when Quipt is to bill and collect for services rendered; ● Quipt’s ability to transition patients in a timely manner may impact Quipt’s ability to collect amounts for services rendered; ● Quipt’s estimates for revenue accruals during the integration of acquisitions may require adjustments in future periods as the transition of patient information is finalized; and ● delays in obtaining new government and commercial insurance payor identification numbers for acquired branches, resulting in a slowdown and/or loss of associated revenue.
There is no guarantee that the Quipt will meet these conditions.‎‎ Moreover, certain employees are 22 Table of Contents required to maintain licenses in the states in which they practice. Quipt manages the facility licensing function centrally.
There is no guarantee that the Quipt will meet these conditions.‎‎ Moreover, certain employees are required to maintain licenses in the states in which they practice. Quipt manages the facility licensing function centrally.
Quipt derived approximately 27% of its net revenue for each of the years ended September 30, 2024 and 2023, by seeking reimbursement from Medicare. If the Medicare program were to slow payments of Quipt receivables for any reason, Quipt would be ‎adversely impacted.
Quipt derived approximately 25% and 27% of its net revenue for the years ended September 30, 2025 and 2024, respectively, by seeking reimbursement from Medicare. If the Medicare program were to slow payments of Quipt receivables for any reason, Quipt would be ‎adversely impacted.
Risks Related to Our Securities We may not be able to effectively maintain controls and procedures required by Section 404 of the Sarbanes-Oxley Act that are applicable to us.
We may not be able to effectively maintain controls and procedures required by Section 404 of the Sarbanes-Oxley Act that are applicable to us.
These programs are subject to statutory and regulatory changes affecting overall spending, base rates or basis of payment, retroactive rate adjustments, annual caps 17 Table of Contents that limit the amount that can be paid (including deductible and coinsurance amounts) for rehabilitation therapy services rendered to Medicare beneficiaries, administrative or executive orders and government funding restrictions, all of which may materially adversely affect the rates and frequency at which these programs reimburse Quipt.
These programs are subject to statutory and regulatory changes affecting overall spending, base rates or basis of payment, retroactive rate adjustments, annual caps that limit the amount that can be paid (including deductible and coinsurance amounts) home medical supplies for Medicare beneficiaries, administrative or executive orders and government funding restrictions, all of which may materially adversely affect the rates and frequency at which these programs reimburse Quipt.
No assurance can be given that no action may ultimately result from the SEC’s investigation. 19 Table of Contents HIPAA, and its implementing regulations, also created additional federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters.
HIPAA, and its implementing regulations, also created additional federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters.
Failure to maintain the security and functionality of Quipt’s information systems and related software or to contract with third parties, or a failure to defend a cybersecurity attack or other attempt to gain unauthorized access to Quipt’s, Quipt’s third-party vendors’, or any of its or their acquisition targets’ systems, facilities or patient health information, could expose Quipt to a number of adverse consequences, the vast majority of which are not insurable, including, but not limited to, disruptions in Quipt’s operations, regulatory and other civil and criminal penalties, fines, investigations and enforcement actions (including, but not limited to, those arising from the SEC, Canadian securities regulatory authorities, FTC, the Office of Inspector General or state attorneys general), private litigation with those affected by the data breach, loss of customers, disputes with payors and increased operating expense, all or any of which could adversely impact Quipt’s financial condition and results of operations. 10 Table of Contents Quipt’s financial performance is affected by continuing efforts by private third-party payors to control their costs, and if Quipt agrees to lower its reimbursement rates due to pricing pressures from such private third-party payors, Quipt’s financial condition and results of operations would likely deteriorate.
Failure to maintain the security and functionality of Quipt’s information systems and related software or to contract with third parties, or a failure to defend a cybersecurity attack or other attempt to gain unauthorized access to Quipt’s, Quipt’s third-party vendors’, or any of its or their acquisition targets’ systems, facilities or patient health information, could expose Quipt to a number of adverse consequences, the vast majority of which are not insurable, including, but not limited to, disruptions in Quipt’s operations, regulatory and other civil and criminal penalties, fines, investigations and enforcement actions (including, but not limited to, those arising from the SEC, Canadian securities regulatory authorities, FTC, the Office of Inspector General or state attorneys general), private litigation with those affected by the data breach, loss of customers, disputes with payors and increased operating expense, all or any of which could adversely impact Quipt’s financial condition and results of operations.
Turmoil in the financial markets, including in the capital and credit markets, and any uncertainty over its breadth, depth and duration may put pressure on the global economy and could have a negative effect on Quipt’s business.
We continue to monitor the worsening macroeconomic conditions. Turmoil in the financial markets, including in the capital and credit markets, and any uncertainty over its breadth, depth, and duration may put pressure on the global economy and could have a negative effect on Quipt’s business.
Therefore, to the extent of these ‎holdings, Quipt (directly and indirectly) is dependent on the cash flows of these subsidiaries to meet its ‎obligations.
Quipt conducts all its operations through its US subsidiaries. Therefore, to the extent of these ‎holdings, Quipt (directly and indirectly) is dependent on the cash flows of these subsidiaries to meet its ‎obligations.
UnitedHealth Group isolated the impacted systems upon learning of this threat and Change Healthcare suspended its claims processing activity with Quipt’s third-party software provider. Although claims processing has resumed, the full impact of this incident has yet to be determined, and it could have an adverse effect on Quipt’s business and results of operations.
UnitedHealth Group isolated the impacted systems upon learning of this threat and Change Healthcare suspended its claims processing activity with Quipt’s third-party software provider. Although claims processing has resumed, this incident could have a continuing adverse effect on Quipt’s business and results of operations.
Although Quipt believes it has appropriate systems in place to monitor licensure, violations of licensing requirements may occur and failure by Quipt to acquire or maintain appropriate licensure for its operations, facilities and clinicians could result in interruptions in its operations, refunds to state and/or federal payors, sanctions or fines or the inability to serve Medicare beneficiaries in competitive bidding markets which could adversely impact Quipt’s financial condition and results of operations.
Although Quipt believes it has appropriate systems in place to monitor licensure, violations of licensing requirements may occur and failure by Quipt to acquire or maintain appropriate licensure for its operations, facilities and clinicians could result in interruptions in its operations, refunds to state and/or federal payors, sanctions or fines or the inability to serve Medicare beneficiaries in competitive bidding markets which could adversely impact Quipt’s financial condition and results of operations. 24 Table of Contents Accreditation is required by most of Quipt’s managed care payors and is a mandatory requirement for all Medicare DMEPOS providers.
Political and economic conditions, including significant global or regional developments such as economic and political events, international conflicts (including the ongoing war in Ukraine and in the Middle East), natural disasters and public health crises that are out of Quipt’s control, could adversely affect its revenue, financial condition and results of operations.
Political and economic conditions, including significant global or regional developments such as economic and political events, including the implementation of tariffs, natural disasters, and public health crises that are out of Quipt’s control, could adversely affect its revenue, financial condition, and results of operations.
The Company may in the ‎‎future be the target of ‎similar litigation.
The Company may in the 31 Table of Contents ‎‎future be the target of ‎similar litigation.
Manufacturers continue to invest in research and development to introduce new products to the marketplace.
Manufacturers continue to invest 14 Table of Contents in research and development to introduce new products to the marketplace.
These events and impacts could materially adversely affect Quipt’s business and results of operations. Risks Related to Our Financial Condition If Quipt were required to write down all or part of its goodwill, its net earnings and net worth could be materially adversely affected. Quipt had approximately $51,000,000 of goodwill recorded on its Consolidated Balance Sheets at September 30, 2024.
Risks Related to Our Financial Condition If Quipt were required to write down all or part of its goodwill, its net earnings and net worth could be materially adversely affected. Quipt had approximately $61,560,000 of goodwill recorded on its Consolidated Balance Sheets at September 30, 2025.
Provisions in our constating documents and under British Columbia law could make an acquisition of us, which may be beneficial to our shareholders, more difficult and may prevent attempts by our shareholders to replace or remove our current management.
Any of the foregoing could negatively affect Quipt’s business, financial condition and results of operations. Provisions in our constating documents and under British Columbia law could make an acquisition of us, which may be beneficial to our shareholders, more difficult and may prevent attempts by our shareholders to replace or remove our current management.
To the extent that any governmental or private payor revises their guidelines to reduce the number of times such supplies can be purchased or the number of months that equipment can be rented, such reductions could adversely impact Quipt’s revenue, financial condition and results of operations. 11 Table of Contents If Quipt fails to manage the complex and lengthy reimbursement process, its revenue, financial condition and results of operations could suffer.
To the extent that any governmental or private payor revises their guidelines to reduce the number of times such supplies can be purchased or the number of months that equipment can be rented, such reductions could adversely impact Quipt’s revenue, financial condition and results of operations.
At times, including at September 30, 2024, Quipt ‎does hold significant cash in Canadian dollars (“C$”).
At times, including at September 30, 2025, Quipt holds significant cash in Canadian dollars (“C$”).
The integration of acquisitions requires significant attention from management, may impose substantial demands on Quipt’s operations or other projects and may impose challenges on us including, but not limited to, consistencies in business standards, procedures, policies and business cultures. There can be no assurance that any future acquisitions, if consummated, will result in further growth.
The integration of acquisitions requires significant attention from management, may impose substantial demands on Quipt’s operations or other projects and may impose challenges on us including, but not limited to, consistencies in business standards, procedures, policies and business cultures.
Payors may also decide to refer business to their owned provider subsidiaries, such as specialty pharmaceuticals and/or home medical equipment networks owned by such payors or by third-party management companies. Any of these activities could materially reduce Quipt’s revenue from these payors.
Payors may also decide to refer business to their own provider subsidiaries, such as specialty pharmaceuticals and/or home medical equipment networks owned by such payors or by third-party management companies.
Additionally, state regulators may determine that telephone calls to patients of Quipt are subject to state telemarketing regulations. If Quipt does not comply with existing or new laws and regulations related to telephone contacts or patient health information, it could be subject to criminal or civil sanctions.
If Quipt does not comply with existing or new laws and regulations related to telephone contacts or patient health information, it could be subject to criminal or civil sanctions.
For example, in May 2021, the Florida legislature passed a bill that expands restrictions for telephonic 24 Table of Contents sales calls, including text messages, made using automated selection and dialing systems and creates a private right of action for violations of the law.
For example, in May 2021, the Florida legislature passed a bill that expands restrictions for telephonic sales calls, including text messages, made using automated selection and dialing systems and creates a private right of action for violations of the law. Additionally, state regulators may determine that telephone calls to patients of Quipt are subject to state telemarketing regulations.
In addition, in the event such disputes are not resolved in Quipt’s favor or cause Quipt to terminate its relationships with such parties, there may be an adverse impact on its financial condition and results of operations. If Quipt is unable to maintain or develop relationships with patient referral sources, its growth and profitability could be adversely affected.
In addition, in the 13 Table of Contents event such disputes are not resolved in Quipt’s favor or cause Quipt to terminate its relationships with such parties, there may be an adverse impact on its financial condition and results of operations.
CMS’s changes included the exercise of enforcement discretion with respect to the clinical conditions and face-to-face encounter requirements required under certain national and local coverage determinations applicable to certain items and supplies Quipt offers. The CARES Act also provided for a temporary suspension of reduced rates for items and services provided by Quipt.
CMS’s changes included the exercise of enforcement discretion with respect to the clinical conditions and face-to-face encounter requirements required under certain national and local coverage determinations applicable to certain items and supplies 19 Table of Contents Quipt offers.
The enactment of the American Rescue Plan Act in 2021 would have triggered PAYGO sequestration in 2021. In the Protecting Medicare & American Farmers from Sequester Cuts Act, Congress delayed the PAYGO sequestration until January 1, 2023.
The enactment of the American Rescue Plan Act in 2021 would have triggered PAYGO sequestration in 2021. In the Protecting Medicare & American Farmers from Sequester Cuts Act, Congress delayed the PAYGO sequestration until January 1, 2023. The Consolidated Appropriations Act, 2023 (Public Law No: 117-328) further prevented implementation of the PAYGO Medicare 4% sequester through the end of 2024.
In addition, there can be no assurance that we will be able to refinance our credit facility upon maturity, or that any such refinancing would be on terms as favorable as the terms of the existing facility.
In addition, there can be no assurance that we will be able to refinance the Facility, which has $87,583,000 outstanding as of September 30, 2025, upon maturity, or that any such refinancing would be on terms as favorable as the terms of the 10 Table of Contents Facility.
Changes made by payors to the way they cover products supplied by Quipt could have an adverse impact on Quipt’s revenue and operations. Payors that provide coverage for products supplied by Quipt can make changes to their plans and benefit designs that can have an adverse impact on Quipt’s revenue and operations.
Payors that provide coverage for products supplied by Quipt can make changes to their plans and benefit designs that can have an adverse impact on Quipt’s revenue and operations. The impact of changing the benefit can include changes to the types of providers that can provide products, increased competition, changes to covered amounts, and changes to patient deductibles.
If treating physicians do not adequately document, among other things, their diagnoses and plans of care, the risks that the Company will be subject to audits and payment denials are likely to increase.
If treating physicians do not adequately document, among other things, their diagnoses and plans of care, the risks that the Company will be subject to audits and payment denials are likely to increase. Moreover, auditors’ interpretations of these policies are inconsistent and subject to individual interpretation, leading to significant increases in individual suppliers and industry-wide perceived error rates.
However, there can be no assurance that other market participants will not attempt to steer patients to competing post-acute providers or otherwise limit Quipt’s access to potential referrals.
However, there can be no assurance that other market participants will not attempt to steer patients to competing post-acute providers or otherwise limit Quipt’s access to potential referrals. The establishment of joint ventures or networks between referral sources, such as acute care hospitals, and other post-acute providers may hinder patient referrals to Quipt.
Penalties for violations of the federal Anti-Kickback Statute include criminal penalties and civil sanctions such as fines, imprisonment and possible exclusion from Medicare, Medicaid and other federal healthcare programs.
The Anti-Kickback Statute is broad and, despite a series of narrow safe harbors, prohibits many arrangements and practices that are lawful in businesses outside of the healthcare industry. Penalties for violations of the federal Anti-Kickback Statute include criminal penalties and civil sanctions such as fines, imprisonment and possible exclusion from Medicare, Medicaid and other federal healthcare programs.
Accordingly, Quipt’s future revenues and cash flows from government healthcare programs may be reduced. Private payors also may conduct audits and may take legal action to recover alleged overpayments.
High error rates could lead to further audit activity and regulatory burdens and could result in Quipt making significant refunds and other payments to Medicare and other government programs. Accordingly, Quipt’s future revenues and cash flows from government healthcare programs may be reduced. Private payors also may conduct audits and may take legal action to recover alleged overpayments.
Accreditation is required by most of Quipt’s managed care payors and is a mandatory requirement for all Medicare DMEPOS providers. If Quipt or any of its branches lose accreditation, or if any of its new branches are unable to become accredited, such failure to maintain accreditation or become accredited could adversely impact Quipt’s financial condition and results of operations.
If Quipt or any of its branches lose accreditation, or if any of its new branches are unable to become accredited, such failure to maintain accreditation or become accredited could adversely impact Quipt’s financial condition and results of operations. Legislative action or changes could adversely affect Quipt’s business, results of operations and financial condition.
However, these drugs may have a significant impact on obesity rates over time, which may result in reduced demand for our current equipment or services, and we may not be able to adapt to those changes to stay competitive. 13 Table of Contents Quipt’s operations involve the transport of compressed and liquid oxygen, which carries an inherent risk of rupture or other accidents with the potential to cause substantial loss and have involved the operation of medical gas facilities that are subject to federal and state regulations, which requires significant compliance oversight and expenses.
Quipt’s operations involve the transport of compressed and liquid oxygen, which carries an inherent risk of rupture or other accidents with the potential to cause substantial loss, and have involved the operation of medical gas facilities that are subject to federal and state regulations, which requires significant compliance oversight and expenses.
A significant amount of our revenue comes from the sale of various products, such as masks and tubing and rental of medical equipment, such as CPAPs, oxygen concentrators, and ventilators. Medicare, Medicaid and private payors limit the number of times per year that patients may purchase such supplies or the number of months that equipment can be rented.
Medicare, Medicaid and private payors limit the number of times per year that patients may purchase such supplies or the number of months that equipment can be rented.
Risks associated with Quipt’s status as a public company 26 Table of Contents may make it more difficult to attract and retain qualified persons to serve on the board of directors or as executive officers.
Quipt has and will continue to incur costs to maintain internal control over financial reporting. It may also be more expensive to obtain director and officer liability insurance. Risks associated with Quipt’s status as a public company may make it more difficult to attract and retain qualified persons to serve on the board of directors or as executive officers.
Quipt experiences competition from numerous other sleep therapy equipment , home respiratory, and mobility equipment providers, and this competition could adversely affect its revenues and its business.
Quipt’s loss of, or failure to maintain, existing relationships or its failure to develop new relationships with referral sources could adversely affect its ability to grow its business and operate profitably. Quipt experiences competition from numerous other sleep therapy equipment , home respiratory, and mobility equipment providers, and this competition could adversely affect its revenues and its business.
In addition, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation. The Anti-Kickback Statute is broad and, despite a series of narrow safe harbors, prohibits many arrangements and practices that are lawful in businesses outside of the healthcare industry.
In addition, a person or entity does not need to have actual knowledge of the statute or specific 20 Table of Contents intent to violate it in order to have committed a violation.
After December 31, 2023, the reimbursement rate has reverted to 100% of the Medicare fee schedule, adjusted to inflation. While Quipt cannot predict what Medicare payment rates or coverage determinations will be in effect in future years, changes to payment rates or benefit coverages may materially impact its financial condition and results of operations.
CMS will announce specific dates for registration and bidding in late spring/early summer 2026, with payment rates in effect no later than January 1, 2028. ​ While Quipt cannot predict what Medicare payment rates or coverage determinations will be in effect in future years, changes to payment rates or benefit coverages may materially impact its financial condition and results of operations.
Fluctuations in the price of Quipt’s securities could contribute to the loss of all or part of your investment.
If we are not able to comply with the requirements in a timely manner or at all, our financial condition or the market price of our common stock may be harmed. Fluctuations in the price of Quipt’s securities could contribute to the loss of all or part of your investment.
We are also no longer eligible to rely upon exemptions from corporate governance requirements that are available to foreign private issuers or to benefit from other accommodations for foreign private issuers under the rules of the SEC or Nasdaq, which may involve additional costs. 27 Table of Contents We are an “emerging growth company” and a “smaller reporting company,” and the reduced disclosure requirements applicable to emerging growth companies or smaller reporting companies may make our Common Shares less attractive to investors.
The existence of material weaknesses in internal control over financial reporting could adversely affect our reputation or investor perceptions of us. We are an “emerging growth company” and a “smaller reporting company,” and the reduced disclosure requirements applicable to emerging growth companies or smaller reporting companies may make our Common Shares less attractive to investors.
Removed
The impact of changing the benefit can include changes to the types of providers that can provide products, increased competition, changes to covered amounts, and changes to patient deductibles. Changes in governmental or private payor supply replenishment schedules could adversely affect Quipt.
Added
Quipt’s financial performance is affected by continuing efforts by private third-party payors to control their costs, and if Quipt agrees to lower its reimbursement rates due to pricing pressures from such private third-party payors, Quipt’s financial condition and results of operations would likely deteriorate.
Removed
The establishment of joint ventures or networks between referral sources, such as acute care hospitals, and other post-acute providers may hinder patient referrals to Quipt. 12 Table of Contents Quipt’s loss of, or failure to maintain, existing relationships or its failure to develop new relationships with referral sources could adversely affect its ability to grow its business and operate profitably.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Item 1C. Cybersecurity. Risk Management and Strategy The Company has adopted policies and implemented certain controls and procedures that allow its management to assess, identify and manage material risks from cybersecurity threats and for its Board of Directors, through its Audit Committee, to actively oversee the strategic direction, objectives, and effectiveness of the Company’s cybersecurity risk management framework.
Item 1C. Cybersecurity. Risk Management and Strategy The Company has adopted policies and implemented certain controls and procedures that allow its management to assess, identify and manage material risks from cybersecurity threats and for the Board of Directors (the “Board”), through its Audit Committee, to actively oversee the strategic direction, objectives, and effectiveness of the Company’s cybersecurity risk management framework.
We have described whether and how risks from identified cybersecurity threats, including as a result of any previous cybersecurity incidents, may materially affect or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition in the risk factors titled “ Quipt’s business depends on its information systems, including software licensed from or hosted by third parties, and ‎any failure or significant disruption or effective cyber-attack on any of these systems, security breaches or improper ‎disclosure of or loss of data could materially affect our business, results of operations and financial condition. ‎” and “ Quipt currently outsources, and from time to time in the 31 Table of Contents future may outsource, a portion of its internal business ‎functions to third-party providers, which has significant risks, and Quipt’s failure to manage these risks successfully ‎could materially adversely affect its business, results of operations, and financial condition .” in Item 1A.
We have described whether and how risks from identified cybersecurity threats, including as a result of any previous cybersecurity incidents, may materially affect or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition in the risk factors titled “ Quipt’s business depends on its information systems, including software licensed from or hosted by third parties, and ‎any failure or significant disruption or effective cyber-attack on any of these systems, security breaches or improper ‎disclosure of or loss of data could materially affect our business, results of operations and financial condition. ‎” and “ Quipt currently outsources, and from time to time in the future may outsource, a portion of its internal business ‎functions to third-party providers, which has significant risks, and Quipt’s failure to manage these risks successfully ‎could materially adversely affect its business, results of operations, and financial condition .” in Item 1A.
Governance Role of the Board of Directors and the Audit Committee As part of the Board of Directors’ role in overseeing the Company’s enterprise risk management program, which includes our cybersecurity risk management framework, the Board is responsible for exercising oversight of management’s identification and management of, and planning for, material cybersecurity risks that may reasonably be expected to impact the Company.
Governance Role of the Board of Directors and the Audit Committee As part of the Board’s role in overseeing the Company’s enterprise risk management program, which includes our cybersecurity risk management framework, the Board is responsible for exercising oversight of management’s identification and management of, and planning for, material cybersecurity risks that may reasonably be expected to impact the Company.
The Company’s processes are integrated into its overall enterprise risk management program and compliments the Company’s enterprise-wide risk assessment architecture, as implemented by the Company’s management and as overseen by the Company’s Board of Directors through its Audit Committee.
The Company’s processes are integrated into its overall enterprise risk management program and compliments the Company’s enterprise-wide risk assessment architecture, as implemented by the Company’s management and as overseen by the Company’s Board through its Audit Committee.
Our CCO has over 20 years of experience in various roles in information technology and information security. He holds a degree in Legal Studies and holds several relevant certifications, including Certified HIPAA Professional (“CHP”).
Our CCO has over 20 years of experience in various roles in information technology and information security. He holds a degree in Legal Studies and holds several relevant certifications, including Certified HIPAA Professional (“CHP”). 34 Table of Contents
Our security training incorporates awareness of cyber threats (including but not limited to malware, ransomware, and social engineering attacks), password hygiene and incident reporting processes. We review our cybersecurity risk framework and related policies annually with our senior management to help identify areas for continued focus and improvement. We also engage third parties to review and assess our processes annually.
Our security training incorporates awareness of cyber threats (including but not limited to malware, ransomware, and social engineering attacks), password hygiene and incident reporting processes. 33 Table of Contents We review our cybersecurity risk framework and related policies annually with our senior management to help identify areas for continued focus and improvement.
Added
We also engage third parties to review and assess our processes annually.

Item 2. Properties

Properties — owned and leased real estate

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Item 2. Properties. The Company’s total space is approximately 700,000 square feet, and consists of warehouse, retail, and administrative offices. The Company leases all but two of its over 135 facilities.
Item 2. Properties. The Company’s total space is approximately 750,000 square feet, and consists of warehouse, retail, and administrative offices. The Company leases all but one of its over 175 facilities.
KY ​ Leased ​ 10,700 ​ Warehouse, retail ​ Waterville, ME ​ Leased ​ 10,370 ​ Warehouse, retail ​ Lincoln, NE ​ Leased ​ 10,000 ​ Warehouse, retail ​ ​ Management believes that the Company’s sites are adequate to support the business and that the properties and equipment have been well maintained. 32 Table of Contents
KY ​ Leased ​ 10,700 ​ Warehouse, retail ​ Grand Blanc, MI ​ Leased ​ 10,700 ​ Administrative ​ Waterville, ME ​ Leased ​ 10,400 ​ Warehouse, retail ​ Lincoln, NE ​ Leased ​ 10,000 ​ Warehouse, retail ​ ​ Management believes that the Company’s sites are adequate to support the business and that the properties and equipment have been well maintained.
The following is a summary of the Company’s largest facilities by location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Square ​ ​ ​ Location Owned / Leased Footage Primary Usage ​ Wilder, KY ​ Leased ​ 25,000 ​ Corporate headquarters, warehouse, administrative ​ Mesa, AZ ​ Leased ​ 24,300 ​ Warehouse, administrative ​ Indianapolis, IN ​ Leased ​ 23,600 ​ Warehouse, administrative ​ McComb, MS ​ Leased ​ 15,600 ​ Warehouse, retail ​ Indianapolis, IN ​ Leased ​ 15,000 ​ Warehouse, retail ​ Paducah, KY ​ Leased ​ 11,500 ​ Warehouse, retail ​ Lexington.
The following is a summary of the Company’s largest facilities by location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Square ​ ​ ​ Location ​ ​ ​ Owned / Leased ​ ​ ​ Footage ​ ​ ​ Primary Usage ​ Wilder, KY ​ Leased ​ 25,000 ​ Corporate headquarters, warehouse, administrative ​ Mesa, AZ ​ Leased ​ 24,300 ​ Warehouse, administrative ​ Flint, MI ​ Leased ​ 21,500 ​ Warehouse ​ Southfield, MI ​ Leased ​ 21,400 ​ Warehouse, administrative ​ Indianapolis, IN ​ Leased ​ 19,100 ​ Warehouse, administrative ​ Indianapolis, IN ​ Leased ​ 15,000 ​ Warehouse, retail ​ Essexville.
Added
MI ​ Leased ​ 13,100 ​ Warehouse, retail, administrative ​ Paducah, KY ​ Leased ​ 11,500 ​ Warehouse, retail ​ Cheboygan. MI ​ Leased ​ 10,800 ​ Warehouse ​ Lexington.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Item 3. Legal Proceedings. From time to time, the Company is involved in legal proceedings and investigations arising in the ordinary course of business, including those relating to employment matters, relationships with clients and contractors, intellectual property disputes and other business matters.
Item 3. Legal Proceedings. From time to time, the Company is involved in various legal proceedings and investigations arising in the ordinary course of business, including those relating to proxy contests and other actions of activist shareholders, employment matters, relationships with clients and contractors, intellectual property disputes and other business matters.
The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and if one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s financial condition and operating results for that period could be materially adversely affected.
The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and if one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s financial condition and operating results for that period could be materially adversely affected. ​ The Company has received a civil investigative demand (“CID”) from the Department of Justice (“DOJ”) through the US Attorney’s Office for the Northern District of Georgia pursuant to the False Claims Act regarding an investigation concerning whether the Company may have caused the submission of false claims to government healthcare programs for CPAP equipment.
Further to the SEC Subpoena, the SEC concluded its investigation in November 2024 and, based on the information it had as at such time, the SEC advised that it did not intend to recommend an enforcement action by it against the Company. Additional governmental agencies could conduct independent investigations relating to this investigation or separate unrelated matters.
The SEC concluded its investigation in November 2024 and, based on the information it had at such time, the SEC advised that it did not intend to recommend an enforcement action by it against the Company. ​ Item 4. Mine Safety Disclosure. Not applicable. 35 Table of Contents PART II
The DOJ has not indicated to the Company whether it believes the Company engaged in any wrongdoing. In April 2024, the Company received a subpoena from the U.S. Securities and Exchange Commission (the “SEC”) to provide certain documents related to the Company and the DOJ investigation, CID, and financial reporting and disclosure matters (“SEC Subpoena”).
The Company is cooperating with the investigation. No assurance can be given as to the timing or outcome of the DOJ’s investigation . ​ In April 2024, the Company received a subpoena from the SEC to provide certain documents related to the Company and the DOJ investigation, CID, and financial reporting and disclosure matters.
Removed
The Company has received a civil investigative demand from the Department of Justice (“DOJ”) through the U.S. Attorney’s Office for the Northern District of Georgia pursuant to the False Claims Act regarding an investigation relating to the Company’s submission of claims relating to CPAP equipment. The Company is cooperating with the investigation.
Removed
No assurance can be given as to the timing or outcome of the DOJ’s investigation or that no action may ultimately result from the SEC’s investigation. Item 4. Mine Safety Disclosure. Not applicable. ​ 33 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities. Market Information and Holders The Company’s Common Shares are listed for trading on the TSX and on Nasdaq, both ‎under the symbol “QIPT”.‎ As of December 11, 2024, there were 83 holders of record of the Company’s Common Shares.
Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities. Market Information and Holders The Company’s Common Shares are listed for trading on the TSX and on Nasdaq, both ‎under the symbol “QIPT”.‎ As of December 11, 2025, there were 83 holders of record of the Company’s Common Shares.
Unregistered Sale of Equity Securities None. Securities Authorized for Issuance under Equity Compensation Plans Such information is incorporated by reference to the information set forth in Part III, Item 12 of this Annual Report on Form 10-K.
Unregistered Sale of Equity Securities None. Securities Authorized for Issuance under Equity Compensation Plans Such information is incorporated by reference to the information set forth in Part III, Item 12 of this Annual Report on Form 10-K. Purchase of Equity Securities Neither we nor any affiliated purchaser repurchased any of our equity securities during the quarter ended September 30, 2025.
Removed
Purchase of Equity Securities On April 23, 2024, the Board authorized a share repurchase program pursuant to which the Company may purchase for cancellation up to 3,626,845 Common Shares from time to time in accordance with applicable securities laws, ‎representing approximately 10% of the Company’s public float (as defined by the TSX) as of such date.
Removed
The repurchase program does not obligate the Company to acquire a specified number of shares and may be modified, suspended, or discontinued at any time at the Board’s discretion.
Removed
The repurchase program commenced on May 6, 2024 and will terminate upon the earliest of (i) April 30‎, 2025, (ii) the Company purchasing the maximum of ‎3,626,845 ‎Common Shares, and (iii) the Company terminating the program. To date, no Common Shares have been repurchased by the Company under the repurchase program. Item 6. [Rese rved] 34 Table of Contents

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Item 6. [Reserved] 34 ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 35 ​ Item 7A. Quantitative and Qualitative Disclosures about Market Risk 51 ​ Item 8. Financial Statements and Supplementary Data 53 ​
Item 6. [Reserved] 36 ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 36 ​ Item 7A. Quantitative and Qualitative Disclosures about Market Risk 52 ​ Item 8. Financial Statements and Supplementary Data 54 ​

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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However, stock-based compensation is being added back because it is non-cash and because the decisions which gave rise to these expenses were not made to increase revenue in a particular period, but rather were made for the Company’s long-term benefit over multiple periods. ● Acquisition-related costs may be useful for the investors to consider because they are professional fees directly related to completing the various acquisitions.
However, stock-based compensation is being added back because it is non-cash and because the decisions which gave rise to these expenses were not made to increase revenue in a particular period, but rather were made for the Company’s long-term benefit over multiple periods. ● Acquisition-related costs may be useful for the investors to consider because they are professional fees directly related to pursuing and completing various acquisitions.
The Company’s potentially dilutive common share equivalents are stock options and restricted stock units. The years ended September 30, 2024 and 2023 were periods of net losses, therefore, the potentially dilutive common share equivalents are excluded in the determination of dilutive net loss per share because their effect is antidilutive.
The Company’s potentially dilutive common share equivalents are stock options and restricted stock units. The years ended September 30, 2025 and 2024 were periods of net losses, therefore, the potentially dilutive common share equivalents are excluded in the determination of dilutive net loss per share because their effect is antidilutive.
The Company does not have any partially or unfilled performance obligations related to contracts with customers and as such, the Company has no contract liabilities during the years ended September 30, 2024 and 2023.
The Company does not have any partially or unfilled performance obligations related to contracts with customers and as such, the Company has no contract liabilities during the years ended September 30, 2025 and 2024.
Lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term for those arrangements where there is an identified asset, and the contract conveys the right to control its use. The right-of-use asset is measured at the initial amount of the lease liability.
Lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term for those arrangements where there is an identified asset, and the contract conveys the right to control its use. The right-of-use asset is measured at the 50 Table of Contents initial amount of the lease liability.
During the years ended September 30, 2024 and 2023, $513,000 and $462,000 of amortization of deferred financing costs was recorded, respectively. Equipment Loans The Company is offered financing arrangements from the Company’s suppliers and the supplier’s designated financial institution, in which payments for certain invoices or products can be financed and paid over an extended period.
During the years ended September 30, 2025 and 2024, $563,000 and $513,000 of amortization of deferred financing costs was recorded, respectively. Equipment Loans The Company is offered financing arrangements from the Company’s suppliers and the supplier’s designated financial institution, in which payments for certain invoices or products can be financed and paid over an extended period.
Contingent consideration that is classified as a liability is measured at subsequent reporting dates at fair value with the corresponding gain or loss being recognized in profit or loss. 50 Table of Contents Contractual Commitments and Obligations The following table summarizes the Company’s contractual commitments and obligations as of September 30, 2024 (in $thousands), which are primarily for debt, leasing of offices and other obligations.
Contingent consideration that is classified as a liability is measured at subsequent reporting dates at fair value with the corresponding gain or loss being recognized in profit or loss. 51 Table of Contents Contractual Commitments and Obligations The following table summarizes the Company’s contractual commitments and obligations as of September 30, 2025 (in thousands), which are primarily for debt, leasing of offices and other obligations.
To manage the risks of the cash flows related to interest expense, the Company entered into several interest rate swaps on $59,000,000 of the principal amount of the Facility. The swaps carry a fixed SOFR of 3.4% to 4.4%, resulting in a weighted combined rate of 6.8%.
To manage the risks of the cash flows related to interest expense, the Company entered into several interest rate swaps on $54,000,000 of the principal amount of the Facility. The swaps carry a fixed SOFR of 3.4% to 4.4%, resulting in a weighted combined rate of 6.6%.
The swaps are settled quarterly and mature on September 30, 2025, 2026 and at the Facility’s maturity. Any difference between the Facility’s SOFR rate and the swap’s rate is recorded as interest expense. For the year ended September 30, 2024, a reduction of $311,000 to interest expense was recorded in the condensed consolidated interim statements of income (loss).
The swaps are settled quarterly and mature on September 30, 2026 and at the Facility’s maturity. Any difference between the Facility’s SOFR rate and the swap’s rate is recorded as interest expense. For the year ended September 30, 2025 and 2024, a reduction of $228,000 and $311,000 to interest expense was recorded in the consolidated statements of income (loss), respectively.
The increase in revenues from the past year is primarily due to the Company’s acquisitions during the year ended September 30, 2023.
The increase in revenues from the past year is primarily due to the Company’s acquisitions during the year ended September 30, 2025.
The rate is based on a secured overnight financing rate (“SOFR”), with a floor of 0.5%, plus a spread of 2.1% to 2.85% (2.65% as of September 30, 2024) based on the Company’s leverage ratio and will reprice within three months.
The rate is based on a secured overnight financing rate (“SOFR”), with a floor of 0.5%, plus a spread of 2.1% to 2.85% (2.4% as of September 30, 2025) based on the Company’s leverage ratio and will reprice within three months.
Senior Credit Facility The Company has a $110,000,000 senior credit facility (“the Facility”) with a group of US banks that matures in September 2027. The Facility consists of a delayed-draw term loan facility of $85,000,000, of which $64,000,000 has been drawn; a term loan of $5,000,000, which was drawn at closing; and a $20,000,000 revolving credit facility.
Senior Credit Facility The Company has a $110,000,000 senior credit facility with a group of US banks that matures in September 2027. The Facility consists of a delayed-draw term loan facility of $85,000,000, of which $83,600,000 has been drawn; a term loan of $5,000,000, which was drawn at closing; and a $20,000,000 revolving credit facility.
Some of the Company’s vehicle lease agreements contain residual value guarantees. 49 Table of Contents The Company determines if an arrangement is a lease at the inception of the contract.
Some of the Company’s vehicle lease agreements contain residual value guarantees. The Company determines if an arrangement is a lease at the inception of the contract.
This represents the Company’s pro rata percentage of the net loss of DMEScripts, LLC, which was acquired in the three months ended September 30, 2023. Provision (benefit) for income taxes The provision for income taxes of $109,000 for the year ended September 30, 2024 increased slightly from the $85,000 for the year ended September 30, 2023.
This represents the Company’s pro rata percentage of the net loss of DMEScripts, LLC, which was acquired in the year ended September 30, 2023. Provision (benefit) for income taxes The provision for income taxes of $241,000 for the year ended September 30, 2025 increased from $109,000 for the year ended September 30, 2024.
This financial measure is intended to provide additional information to investors concerning ‎the ‎Company’s performance.‎ Adjusted EBITDA is defined as net income (loss), adjusted for net interest expense, depreciation, amortization, right-of-use operating lease amortization and interest, provision (benefit) for income taxes, professional fees related to CID and loss of foreign private issuer status, stock-based compensation, acquisition-related costs, loss on extinguishment of debt, gain (loss) on foreign currency transactions, change in fair value of derivative liability – interest rate swap, and share of 39 Table of Contents loss in equity method investment.
This financial measure is intended to provide additional information to investors concerning ‎the ‎Company’s performance.‎ Adjusted EBITDA is defined as net income (loss), adjusted for net interest expense, depreciation, amortization, right-of-use operating lease amortization and interest, provision (benefit) for income taxes, certain professional fees, stock-based compensation, acquisition-related costs, gain on disposals of property and equipment, gain (loss) on foreign currency transactions, change in fair value of derivative liability – interest rate swap, and share of loss in equity method investment.
If the carrying amount of the reporting unit exceeds the reporting unit’s fair value, an impairment loss is recognized equal to the difference between the carrying amount and the estimated fair value of the reporting unit. The Company concluded that there was no impairment of goodwill during fiscal 2024 or 2023.
If the carrying amount of the reporting unit exceeds the reporting unit’s fair value, an impairment loss is recognized equal to the difference between the carrying amount and the estimated fair value of the reporting unit. The Company concluded that there was no impairment of goodwill during the years ended September 30, 2025 or 2024.
Share of loss in equity method investment Share of loss in equity method investment was a loss of $67,000 and $309,000 for the three months and year ended September 30, 2024, respectively. Equity in earnings of investment was a loss of $89,000 for the three months and year ended September 30, 2023.
Share of loss in equity method investment Share of loss in equity method investment was a loss of $79,000 and $324,000 for the three months and year ended September 30, 2025, respectively. Share of loss in equity method investment was a loss of $67,000 and $309,000 for the three months and year ended September 30, 2024.
Non-monetary items that are not carried at fair value are translated using the exchange rates at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.
Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.
The primary purpose of this non-GAAP measure is to provide supplemental information that may prove useful to investors who wish to consider the impact of certain non-cash or unusual items on the Company’s operating performance. Management uses both GAAP and non-GAAP measures when planning, monitoring, and evaluating the Company’s performance.
The primary purpose of this non-GAAP measure is to provide supplemental information that may prove useful to investors who wish to consider the impact of certain non-cash or unusual items on the Company’s operating performance.
The leases have a combined area of 74,520 square feet. Lease payments under these leases are approximately $65,000 per month beginning October 2022, with increases on October 1 of each year equal to the greater of (i) the Consumer Price Index for All Urban Consumers (CPI-U), and (ii) 3%.
The leases have a combined area of 74,520 square feet. Lease payments under these leases were approximately $65,000 and $63,000 per month for the twelve months ended September 30, 2025 and 2024, respectively, with increases on October 1 of each year equal to the greater of (i) the Consumer Price Index for All Urban Consumers (CPI-U), and (ii) 3%.
However, we do not consider the amount of income tax expense to be a representative component of the day-to-day operating performance of our business. ● We consider the professional fees related to the CID and the loss of private issuer status to be non-recurring events, and therefore not a representative component of the day-to-day operating performance of our business. ● Stock-based compensation may be useful for investors to consider because it is a component of compensation received by the Company’s directors, officers, employees, and consultants.
However, we do not consider the amount of income tax expense to be a representative component of the day-to-day operating performance of our business. ● We do not consider certain professional fees, including those related to the CID, the loss of foreign private issuer status, and proxy contests and other actions of activist shareholders, to be representative components of the day-to-day operating performance of our business. ● Stock-based compensation expense may be useful for investors to consider because it is a component of compensation received by the Company’s directors, officers, employees, and consultants.
As of September 30, 2024, the Company had cash on hand of $16,174,000 and revolving credit availability under the Facility, defined below, of $13,677,000. The Company’s approach in managing liquidity is to ensure, to the extent possible, that it will have enough liquidity to meet its liabilities when due.
As of September 30, 2025, the Company had cash on hand of $12,916,000 and revolving credit availability under the Facility of $9,050,000. The Company’s approach in managing liquidity is to ensure, to the extent possible, that it will have enough liquidity to meet its liabilities when due.
The Facility is secured by substantially all assets of the Company and is subject to certain financial covenants, with which the Company was in compliance as of September 30, 2024. 43 Table of Contents A summary of the outstanding balances related to the Facility as of September 30, 2024 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ As of As of ​ September 30, 2024 September 30, 2023 Delayed-draw term loan ​ $ 58,400 ​ $ 61,600 Term loan ​ 4,500 ​ 4,750 Revolving credit facility ​ ​ 6,323 ​ ​ — Total principal ​ ​ 69,223 ​ ​ 66,350 Deferred financing costs ​ ​ (1,430) ​ ​ (1,884) Net carrying value ​ $ 67,793 ​ $ 64,466 ​ ​ ​ ​ ​ ​ ​ Current portion ​ 3,248 ​ 3,352 Long-term portion ​ 64,545 ​ 61,114 Net carrying value ​ $ 67,793 ​ $ 64,466 ​ The delayed-draw term loan and the term loan are bearing interest at a weighted average 7.6% as of September 30, 2024.
The Facility is secured by substantially all assets of the Company and is subject to certain financial covenants, with which the Company was in compliance as of September 30, 2025. 45 Table of Contents A summary of the outstanding balances related to the Facility as of September 30, 2025 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of As of ​ ​ ​ ​ September 30, 2025 ​ ​ ​ September 30, 2024 Delayed-draw term loan ​ $ 72,383 ​ $ 58,400 Term loan ​ 4,250 ​ 4,500 Revolving credit facility ​ ​ 10,950 ​ ​ 6,323 Total principal ​ ​ 87,583 ​ ​ 69,223 Deferred financing costs ​ ​ (948) ​ ​ (1,430) Net carrying value ​ $ 86,635 ​ $ 67,793 ​ ​ ​ ​ ​ ​ ​ Current portion ​ $ 4,155 ​ $ 3,248 Long-term portion ​ 82,480 ​ 64,545 Net carrying value ​ $ 86,635 ​ $ 67,793 ​ The delayed-draw term loan and the term loan are bearing interest at a weighted average 6.7% as of September 30, 2025.
Fair value is measured using the Black-Scholes Model. In estimating fair value, management is required to make certain assumptions and estimates, such as the expected life of units, volatility of the Company’s future share price, risk-free interest rates, and future dividend yields, at the initial grant date.
In estimating fair value, management is required to make certain assumptions and estimates, such as the expected life of units, volatility of the Company’s future share price, risk-free interest rates, and future dividend yields, at the initial grant date. Changes in assumptions used to estimate fair value could result in materially different results.
Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those described in Item 1A. "Risk Factors" and elsewhere in this Annual Report on Form 10-K.
Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those described in Part I, Item 1A.
Customer contracts are recognized at the estimated fair value of the present value of expected future customer billings based on the statistical life of a customer. Customer relationships are recognized based on the estimated fair value given to the long-term associations with referral sources such as doctors, medical centers, etc.
Customer relationships are recognized based on the estimated fair value given to the long-term associations with referral sources such as doctors, medical centers, etc.
The market approach compares the reporting unit to similar companies with the assumption that companies operating in the same industry will share similar characteristics and that company values will correlate to those characteristics.
The income approach utilizes a discounted cash flow analysis using management’s assumptions. The market approach compares the reporting unit to similar companies with the assumption that companies operating in the same industry will share similar characteristics and that company values will correlate to those characteristics.
Future payments on these liabilities are as follows (in thousands): ​ ​ ​ ​ Less than 1 year $ 12,573 Between 1 and 5 years ​ 27,053 More than 5 years ​ 886 Total ​ 40,512 Less: finance charges ​ (21,362) Lease liabilities ​ ​ 19,150 Current portion of lease liabilities ​ ​ 5,867 Long-term portion of lease liabilities ​ $ 13,283 ​ Quarterly operating results Results of operations for the healthcare services market in which the Company operates show little seasonality from quarter to quarter.
Future payments on these liabilities are as follows (in thousands): ​ ​ ​ ​ Less than 1 year ​ ​ ​ $ 8,079 Between 1 and 5 years ​ 13,792 More than 5 years ​ 778 Total ​ 22,649 Less: finance charges ​ (2,707) Lease liabilities ​ ​ 19,942 Current portion of lease liabilities ​ ​ 6,898 Long-term portion of lease liabilities ​ $ 13,044 ​ Quarterly operating results Results of operations for the healthcare services market in which the Company operates show little seasonality from quarter to quarter.
One lease expires in June 2026 and the remaining five leases expire on September 30, 2029. 45 Table of Contents Off balance sheet arrangements The Company has no material undisclosed off-balance sheet arrangements that have or are reasonably likely to have, a current or future effect on its results of operations or financial condition, revenues or expenses results of operations, liquidity, capital expenditures or capital resources.
Off balance sheet arrangements The Company has no material undisclosed off balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on its results of operations or financial condition, revenues or expenses results of operations, liquidity, capital expenditures or capital resources.
We will continue to improve operational efficiencies and call center management as they are key execution points to maintaining our Adjusted EBITDA while growing revenues by cross selling products to existing and acquired patients.
Our continued business integration and rationalization, and our prior acquisitions, have given us a focus and path toward revenue growth and profitability. We will continue to improve operational efficiencies and call center management as they are key execution points to maintaining our Adjusted EBITDA while growing revenues by cross selling products to existing and acquired patients.
The ​​​​proceeds ​​ ​​were ​​expected ​​to ​​be ​​used for acquisitions, working capital, and general corporate requirements. The proceeds were fully used to acquire Great Elm. Proceeds have been used as intended.
The ​​​​proceeds ​​ ​​were ​​expected ​​to ​​be ​​used for acquisitions, working capital, and general corporate requirements. The proceeds drawn to date were fully used to acquire Hart.
Significant judgments are made in order to incorporate forward-looking information into the estimation of reserves and may result in changes to revenue and accounts receivable period to period which may significantly affect the Company’s results of operations. Inventory Inventory is stated at the lower of cost or net realizable value with cost determined using the first-in, first-out method.
Significant judgments are made in order to incorporate forward-looking information into the estimation of reserves and may result in changes to revenue and accounts receivable period to period which may significantly affect the Company’s results of operations.
The Company had the following equity instruments outstanding as of September 30, 2024 and September 30, 2023: ​ ​ ​ ​ ​ ​ As of As of ​ ​ September 30, 2024 ​ September 30, 2023 ​ ​ (000’s) ​ (000’s) Common shares 43,090 42,102 Options 3,402 3,957 Restricted stock units 519 1,034 ​ ​ ​ ​ ​ Financing Historically and currently, the Company has financed its operations from cash flow from operations, equipment loans, debentures, leases, equity financing, and through the issuance of shares to acquire businesses.
The Company had the following equity instruments outstanding as of September 30, 2025 and September 30, 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ As of ​ ​ ​ As of ​ ​ September 30, 2025 ​ September 30, 2024 Common shares 43,444 43,090 Options 3,778 3,402 Restricted stock units 2,583 519 ​ ​ ​ ​ ​ Financing Historically and currently, the Company has financed its operations from cash flow from operations, borrowings on the Facility, equipment loans, leases, and through the issuance of equity.
Foreign currency transactions Transactions in foreign currencies are initially recorded at the foreign currency spot rate or the rate realized in the transaction. Monetary items are translated at the foreign currency spot rate as of the reporting date and exchange differences from monetary items are recognized in profit or loss.
Monetary items are translated at the foreign currency spot rate as of the reporting date and exchange differences from monetary items are recognized in profit or loss. Non-monetary items that are not carried at fair value are translated using the exchange rates at the date of the initial transaction.
The consolidated financial statements as of and for the years ended September 30, 2024 and 2023 (the “consolidated financial statements”) of the Company were prepared in accordance with accounting principles generally accepted in the US (“GAAP”).
"Risk Factors" and elsewhere in this Annual Report on Form 10-K. 36 Table of Contents The audited consolidated financial statements as of and for the years ended September 30, 2025 and 2024 (the “consolidated financial statements”) of the Company were prepared in accordance with accounting principles generally accepted in the US (“GAAP”).
Right-of-use operating lease amortization and interest Right-of-use operating lease amortization and interest increased to $5,974,000 for the year ended September 30, 2024 from $5,131,000, or 16.4% for the year ended September 30, 2023. The increase was primarily due to the full year impact of the acquisitions during the year ended September 30, 2023.
Right-of-use operating lease amortization and interest Right-of-use operating lease amortization and interest increased by $460,000 to $6,434,000 for the year ended September 30, 2025 from $5,974,000 for the year ended September 30, 2024. The increase was due to new locations and, to a lesser extent, the impact of the acquisitions during the year ended September 30, 2025.
Readers are cautioned that the disclosure of these items is meant to add to, and not replace, the discussion of financial results as determined in accordance with GAAP.
This metric is a non-standard measure under GAAP and may not be identical to similar measures reported by other companies. Readers are cautioned that the disclosure of these items is meant to add to, and not replace, the discussion of financial results as determined in accordance with GAAP.
The Company will do so by continuously monitoring actual and expected cash flows and monitoring financial market conditions for signs of weakness.
The Company will do so by continuously monitoring actual and expected cash flows and monitoring financial market conditions for signs of weakness. The Company faces minimal liquidity risk in its current financial obligations as they become due and payable.
The consolidated financial statements, which are presented in US dollars, have been prepared under the historical cost convention, as modified by the measurement at fair values of certain financial assets and financial liabilities.
The consolidated financial statements, which are presented in US dollars, have been prepared under the historical cost convention, as modified by the measurement at fair values of certain financial assets and financial liabilities. Overview Quipt business objective The growth in the number of elderly patients in the US healthcare market is creating pressure to provide more efficient delivery systems.
Selected Annual Information ($ amounts in thousands, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of or for the As of or for the As of or for the As of or for the ​ ​ three months ended ​ three months ended ​ year ended ​ year ended ​ ​ September ​ September ​ September ​ September ​ ​ 30, 2024 ​ 30, 2023 ​ 30, 2024 ​ 30, 2023 Number of patients served (1) ​ 153,000 ​ ​ 147,000 ​ ​ 314,000 ​ ​ 286,000 Number of equipment set-ups or deliveries ​ 212,000 ​ ​ 209,000 ​ ​ 854,000 ​ ​ 754,000 Respiratory resupply set-ups or deliveries ​ 120,000 ​ ​ 111,000 ​ ​ 480,000 ​ ​ 396,000 Adjusted EBITDA ​ $ 13,369 ​ $ 14,662 ​ $ 57,853 ​ $ 50,631 Total revenues ​ $ 61,332 ​ $ 59,648 ​ $ 245,915 ​ $ 211,677 Net income (loss) per share - Basic ​ $ (0.07) ​ $ (0.03) ​ $ (0.16) ​ $ (0.07) Net income (loss) per share - Diluted ​ $ (0.07) ​ $ (0.03) ​ $ (0.16) ​ $ (0.07) Total assets ​ ​ ​ ​ ​ ​ ​ $ 247,248 ​ $ 247,408 Total long-term liabilities ​ ​ ​ ​ ​ ​ ​ $ 79,207 ​ $ 75,719 Shareholders' equity ​ ​ ​ ​ ​ ​ ​ $ 107,191 ​ $ 111,115 (1) The twelve-month periods do not equal the sum of the four respective three-month periods due to some patients being served in multiple three-month periods. ​ Operating Results The fiscal year ended September 30, 2024 presented us with a range of challenges that we absorbed in the period, which negatively impacted our financial performance and prevented us from achieving our target of 8 to 10% annualized organic growth.
Selected Annual Information ($ amounts in thousands, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of or for the ​ ​ ​ As of or for the ​ ​ ​ As of or for the ​ ​ ​ As of or for the ​ ​ three months ended ​ three months ended ​ year ended ​ year ended ​ ​ September ​ September ​ September ​ September ​ ​ 30, 2025 ​ 30, 2024 ​ 30, 2025 ​ 30, 2024 Number of patients served ​ 200,000 ​ ​ 153,000 ​ ​ 346,000 ​ ​ 314,000 Number of equipment set-ups or deliveries ​ 282,000 ​ ​ 212,000 ​ ​ 917,000 ​ ​ 854,000 Respiratory resupply set-ups or deliveries ​ 133,000 ​ ​ 120,000 ​ ​ 486,000 ​ ​ 480,000 Adjusted EBITDA ​ $ 14,924 ​ $ 13,444 ​ $ 55,947 ​ $ 57,746 Total revenues ​ $ 68,313 ​ $ 61,332 ​ $ 245,359 ​ $ 245,915 Net income (loss) per share - Basic ​ $ (0.08) ​ $ (0.07) ​ $ (0.24) ​ $ (0.16) Net income (loss) per share - Diluted ​ $ (0.08) ​ $ (0.07) ​ $ (0.24) ​ $ (0.16) Total assets ​ ​ ​ ​ ​ ​ ​ $ 283,289 ​ $ 247,248 Total long-term liabilities ​ ​ ​ ​ ​ ​ ​ $ 96,484 ​ $ 79,207 Shareholders' equity ​ ​ ​ ​ ​ ​ ​ $ 112,097 ​ $ 107,191 ​ ​ (1) 37 Table of Contents Operating Results The fiscal year ended September 30, 2025 presented us with a range of challenges that we absorbed in the period, which negatively impacted our financial performance and prevented us from achieving our target annualized organic growth.
Interest expense on the Facility, including the impact of the interest rate swap agreement, was $5,346,000 and $4,415,000 for the years ended September 30, 2024 and 2023, respectively The Company has incurred financing costs to obtain and maintain the Facility, which is reflected as a reduction of the outstanding balance and will be amortized as interest expense using the effective interest method over the life of the Facility.
The Company has incurred financing costs to obtain and maintain the Facility, which is reflected as a reduction of the outstanding balance and will be amortized as interest expense using the effective interest method over the life of the Facility.
Changes in assumptions used to estimate fair value could result in materially different results. The Company has elected to recognize the effect of forfeitures in compensation cost when they occur. Previously recognized compensation cost for an award is reversed in the period that the award is forfeited.
The Company has elected to recognize the effect of forfeitures in compensation cost when they occur. Previously recognized compensation cost for an award is reversed in the period that the award is forfeited. Further, the Company has elected to use the contractual term as the expected term.
The benefit for income taxes was $273,000 for the three months ended September 30, 2024, as compared to a provision for income taxes of $75,000 for the three months ended September 30, 2023. The benefit primarily relates to the filing of the returns for the year ended September 30, 2023 being more favorable than originally estimated.
The benefit in the three months ended September 30, 2024 primarily relates to the filing of the tax returns for the year ended September 30, 2023 being more favorable than originally estimated. Net income attributed to noncontrolling interest The net income attributable to noncontrolling interest was $121,000 for both the three months and year ended September 30, 2025.
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. Rental revenue, less estimated adjustments, is recognized as earned on a straight-line basis over the noncancellable lease term.
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.
The following table provides selected historical information and other data, which should be read in conjunction with the financial statements of the Company (amounts in thousands except per share amounts). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of or for the ​ As of or for the ​ As of or for the ​ As of or for the ​ three months ended three months ended three months ended three months ended ​ ​ September 30, 2024 ​ June 30, 2024 ​ March 31, 2024 ​ December 31, 2023 Revenue ​ $ 61,332 ​ $ 60,759 ​ $ 61,249 ​ $ 62,575 Net income (loss) ​ (3,111) ​ (1,701) ​ (1,365) ​ (586) Net income (loss) per share - basic ​ (0.07) ​ (0.04) ​ (0.03) ​ (0.01) Net income (loss) per share - diluted ​ ​ (0.07) ​ ​ (0.04) ​ ​ (0.03) ​ ​ (0.01) Total assets ​ $ 247,248 ​ $ 249,784 ​ $ 248,614 ​ $ 243,893 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of or for the ​ As of or for the ​ As of or for the ​ As of or for the ​ three months ended three months ended three months ended three months ended ​ ​ September 30, 2023 ​ June 30, 2023 ​ March 31, 2023 ​ December 31, 2022 Revenue ​ $ 59,648 ​ $ 57,859 ​ $ 55,638 ​ $ 38,532 Net income (loss) ​ (1,326) ​ (1,034) ​ (749) ​ 325 Net income (loss) per share - basic ​ (0.03) ​ (0.03) ​ (0.02) ​ 0.01 Net income (loss) per share - diluted ​ ​ (0.03) ​ ​ (0.03) ​ ​ (0.02) ​ ​ 0.01 Total assets ​ $ 247,408 ​ $ 242,385 ​ $ 225,543 ​ $ 131,725 ​ Related party transactions The Company has six leases for office, warehouse, and retail space with a rental company affiliated with the Company’s Chief Executive Officer, Gregory Crawford, the majority of which were entered into in 2015.
The following table provides selected historical information and other data, which should be read in conjunction with the consolidated financial statements of the Company (amounts in thousands except per share amounts). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of or for the ​ As of or for the ​ As of or for the ​ As of or for the ​ ​ ​ ​ three months ended ​ ​ ​ three months ended ​ ​ ​ three months ended ​ ​ ​ three months ended ​ ​ September 30, 2025 ​ June 30, 2025 ​ March 31, 2025 ​ December 31, 2024 Revenue ​ $ 68,313 ​ $ 58,289 ​ $ 57,376 ​ $ 61,381 Net income (loss) ​ (3,550) ​ (3,025) ​ (3,042) ​ (1,084) Net income (loss) per share - basic ​ (0.08) ​ (0.07) ​ (0.07) ​ (0.03) Net income (loss) per share - diluted ​ ​ (0.08) ​ ​ (0.07) ​ ​ (0.07) ​ ​ (0.03) Total assets ​ $ 283,289 ​ $ 236,092 ​ $ 244,645 ​ $ 242,816 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of or for the ​ As of or for the ​ As of or for the ​ As of or for the ​ ​ ​ ​ three months ended ​ ​ ​ three months ended ​ ​ ​ three months ended ​ ​ ​ three months ended ​ ​ September 30, 2024 ​ June 30, 2024 ​ March 31, 2024 ​ December 31, 2023 Revenue ​ $ 61,332 ​ $ 60,759 ​ $ 61,249 ​ $ 62,575 Net income (loss) ​ (2,940) ​ (1,596) ​ (739) ​ (1,488) Net income (loss) per share - basic ​ (0.07) ​ (0.04) ​ (0.02) ​ (0.04) Net income (loss) per share - diluted ​ ​ (0.07) ​ ​ (0.04) ​ ​ (0.02) ​ ​ (0.04) Total assets ​ $ 247,248 ​ $ 249,784 ​ $ 248,614 ​ $ 243,893 ​ Related party transactions The Company (through indirect wholly owned subsidiaries) has six leases for office, warehouse, and retail space with a rental company affiliated with the Company’s Chief Executive Officer, the majority of which were entered into in 2015, 47 Table of Contents prior to such subsidiaries being acquired by the Company and prior to the Chief Executive Officer joining the Company, and five of which were renewed effective October 1, 2022.
Stock-based compensation Stock-based compensation decreased by $2,796,000 to approximately $2,484,000 for the year ended September 30, 2024 due to timing of the vesting of the grants of restricted stock units and stock options during the years ended September 30, 2024 and 2023 and no new awards being granted during the year ended September 30, 2024.
Stock-based compensation Stock-based compensation increased by $1,551,000 to approximately $4,035,000 for the year ended September 30, 2025 from $2,484,000 for the year ended September 30,2024 due to grants of restricted stock units and stock options during the year ended September 30, 2025.
As of September 30, 2024, the fair value of the interest rate swap liability was $1,122,000, and is recorded in derivative liability – interest rate swap in the condensed consolidated statements of financial position. The Company has recorded the changes in fair value of derivative liability – interest rate swaps on the consolidated statements of income (loss).
The Company has recorded the changes in fair value of derivative liability – interest rate swaps on the consolidated statements of income (loss). Interest expense on the Facility, including the impact of the interest rate swap agreements, was $5,095,000 and $5,346,000 for the years ended September 30, 2025 and 2024, respectively.
Further, the Company has elected to use the contractual term as the expected term. Compensation expense is recognized on a straight-line basis, by amortizing the grant date fair value over the vesting period for each separately vesting portion of the award.
Compensation expense is recognized on a straight-line basis, by amortizing the grant date fair value over the vesting period for each separately vesting portion of the award. Loss per share The Company presents basic and diluted loss per share data for its ordinary shares.
Adjusted EBITDA This MD&A refers to “Adjusted EBITDA,” which is a non-GAAP ‎financial measure that does not have standardized meaning prescribed by GAAP. The ‎Company’s ‎presentation of this financial measure may not be comparable to similarly titled measures used by ‎other ‎companies.
Management uses both GAAP and non-GAAP measures when planning, monitoring, and evaluating the Company’s performance. 41 Table of Contents Adjusted EBITDA This MD&A refers to “Adjusted EBITDA,” which is a non-GAAP ‎financial measure that does not have standardized meaning prescribed by GAAP.
The Company does not consider this a separate performance obligation since these shipping and handling activities occur before the customer obtains control of the goods. The shipping and handling are considered activities to fulfill the entity’s promise to transfer the goods and are expensed as within operating expenses.
Shipping and handling The Company provides shipping and handling at no charge in sending product to customers. The Company does not consider this a separate performance obligation since these shipping and handling activities occur before the customer obtains control of the goods.
Share-based payments The Company grants stock options and restricted stock units to employees, members of the Board of Directors, and consultants. The Company measures equity settled share-based payments based on their fair value at the grant date and 48 Table of Contents recognizes compensation expense on a straight-line basis over the vesting period.
The Company measures equity settled share-based payments based on their fair value at the grant date and recognizes compensation expense on a straight-line basis over the vesting period. Fair value is measured using the Black-Scholes Model.
Comparison of Results of Operations for the Years and Three Months Ended September 30, 2024 and 2023 The following table summarizes our results of operations for the years and three months ended September 30, 2024 and 2023 (amounts in $thousands, except per share amounts): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the three For the three For the For the ​ months ended ​ months ended ​ year ended ​ year ended ​ ​ September 30, ​ September 30, ​ September 30, ​ September 30, ​ 30, 2024 ​ 30, 2023 ​ 30, 2024 ​ 30, 2023 Total revenues ​ $ 61,332 ​ $ 59,648 ​ $ 245,915 ​ $ 211,677 Cost of inventory sold ​ 17,664 ​ 16,283 ​ 68,925 ​ 57,897 Operating expenses ​ 31,446 ​ 28,691 ​ 122,542 ​ 103,224 Right-of-use operating lease amortization and interest ​ ​ 1,362 ​ ​ 1,450 ​ ​ 5,974 ​ ​ 5,131 Depreciation ​ 10,016 ​ 9,483 ​ 38,490 ​ 30,901 Amortization of intangible assets ​ 1,521 ​ 1,453 ​ 6,091 ​ 5,197 Stock-based compensation ​ 330 ​ 1,369 ​ 2,484 ​ 5,280 Acquisition-related costs ​ 7 ​ 137 ​ 401 ​ 1,269 Loss (gain) on sale of property and equipment ​ (55) ​ 12 ​ (107) ​ (75) Interest expense, net ​ 1,524 ​ ​ 1,610 ​ 6,381 ​ ​ 5,541 Loss on extinguishment of debt ​ ​ — ​ ​ — ​ ​ — ​ ​ 30 (Gain) loss on foreign currency transactions ​ (188) ​ 322 ​ (43) ​ (108) Share of loss in equity method investment ​ ​ 67 ​ ​ 89 ​ ​ 309 ​ ​ 89 Change in fair value of derivative liability - interest rate swap ​ 1,122 ​ — ​ 1,122 ​ — Provision (benefit) for income taxes ​ (273) ​ 75 ​ 109 ​ 85 Net loss ​ $ (3,211) ​ $ (1,326) ​ $ (6,763) ​ $ (2,784) Loss per share ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ (0.07) ​ $ (0.03) ​ $ (0.16) ​ $ (0.07) Diluted ​ $ (0.07) ​ $ (0.03) ​ $ (0.16) ​ $ (0.07) ​ Revenue For the year ended September 30, 2024, revenue totaled $245,915,000, an increase of $34,238,000, or 16%, from the year ended September 30, 2023.
The cumulative impact of these events on total revenue is estimated to be approximately $1,500,000 and $8,500,000 for the three and twelve months ended September 30, 2025, respectively. 38 Table of Contents Comparison of Results of Operations for the Years and Three Months Ended September 30, 2025 and 2024 The following table summarizes our results of operations for the years and three months ended September 30, 2025 and 2024 (amounts in thousands, except per share amounts): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the three ​ ​ ​ For the three ​ ​ ​ For the ​ ​ ​ For the ​ ​ ​ ​ months ended ​ months ended ​ year ended ​ year ended ​ ​ September 30, ​ September 30, ​ September 30, ​ September 30, ​ ​ ​ ​ 30, 2025 ​ 30, 2024 ​ 30, 2025 ​ 30, 2024 Total revenues ​ $ 68,313 ​ $ 61,332 ​ $ 245,359 ​ $ 245,915 Cost of inventory sold ​ 20,406 ​ 17,664 ​ 68,182 ​ 68,925 Operating expenses ​ 34,125 ​ 31,446 ​ 125,457 ​ 122,542 Right-of-use operating lease amortization and interest ​ ​ 1,681 ​ ​ 1,362 ​ ​ 6,434 ​ ​ 5,974 Depreciation ​ 10,369 ​ 10,016 ​ 39,429 ​ 38,490 Amortization of intangible assets ​ 1,505 ​ 1,521 ​ 6,053 ​ 6,091 Stock-based compensation ​ 1,409 ​ 330 ​ 4,035 ​ 2,484 Acquisition-related costs ​ 596 ​ 7 ​ 817 ​ 401 Gain on disposals of property and equipment ​ (329) ​ (55) ​ (1,225) ​ (107) Interest expense, net ​ 1,634 ​ ​ 1,524 ​ 6,277 ​ ​ 6,381 (Gain) loss on foreign currency transactions ​ 136 ​ (188) ​ 367 ​ (43) Share of loss in equity method investment ​ ​ 79 ​ ​ 67 ​ ​ 324 ​ ​ 309 Change in fair value of derivative liability - interest rate swap ​ (10) ​ 952 ​ (452) ​ 1,122 Provision (benefit) for income taxes ​ 141 ​ (374) ​ 241 ​ 109 Net income attributable to noncontrolling interest ​ ​ 121 ​ ​ — ​ ​ 121 ​ ​ — Net loss ​ $ (3,550) ​ $ (2,940) ​ $ (10,701) ​ $ (6,763) Loss per share ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ (0.08) ​ $ (0.07) ​ $ (0.24) ​ $ (0.16) Diluted ​ $ (0.08) ​ $ (0.07) ​ $ (0.24) ​ $ (0.16) ​ Revenue For the year ended September 30, 2025, revenue totaled $245,359,000, a decrease of $556,000, or 0.2%, from the year ended September 30, 2024.
Accounts receivable The Company estimates that a certain portion of receivables from customers may not be collected and maintains a reserve for expected pricing concessions and insurance denials.
Estimates where management has made subjective judgments and where there is significant risk of material adjustments to assets and liabilities in future accounting periods included in the list below. Accounts receivable The Company estimates that a certain portion of receivables from customers may not be collected and maintains a reserve for expected pricing concessions and insurance denials.
Non-compete agreements are recognized at the estimated fair value associated with the non-compete agreements entered by the sellers of acquired companies. Trademarks are recognized at the estimated fair value associated with the trade name of the acquired company.
Intangible assets The Company has recorded various intangible assets consisting primarily of non-compete agreements, trademarks, customer contracts and customer relationships in connection with various business acquisitions. Non-compete agreements are recognized at the estimated fair value associated with the non-compete agreements entered by the sellers of acquired companies.
This decrease is due to not making any acquisitions during the year ended September 30, 2024. Acquisition related costs decreased by $129,000 to $7,000 for the three months ended September 30, 2024, due to not making any acquisitions during the year ended September 30 2024.
Acquisition-related costs Acquisition related costs increased by $416,000 to $817,000 for the year ended September 30, 2025 from $401,000 for the year ended September 30, 2024. This increase is due to acquisitions during the year ended September 30, 2025.
The financial institution pays the supplier when the original invoice becomes due, and the Company pays the third-party financial institution over a period of time. In most cases, the supplier accepts a discounted amount from the financial institution and the Company repays the financial institution the face amount of the invoice with no stated interest, in twelve equal monthly installments.
The financial institution pays the supplier when the original invoice becomes due, and the Company pays the third-party financial institution over a period of time.
The revolving credit facility is bearing interest at 7.7% as of September 30, 2024 and will reprice within one month. The Facility also has fees for unused availability. Due to the near-term repricing of the interest rates, the fair value of the Facility approximates the principal value as of September 30, 2024 and 2023.
The revolving credit facility is bearing interest at 7.0% as of September 30, 2025 and will reprice within three months. The Facility also has fees for unused availability of 0.75% for the delayed-draw term loan and 0.25% for the revolving credit facility.
Stock-based compensation decreased by $1,038,000 to approximately $330,000 for the three months ended September 30, 2024 due to timing of the vesting of the grants of restricted stock units and stock options during the quarters ended September 30, 2024 and 2023 and no new awards being granted during the year ended September 30, 2024. 38 Table of Contents Acquisition-related costs Acquisition related costs decreased by $868,000 to $401,000 for the year ended September 30, 2024.
Stock-based compensation increased by $1,079,000 to approximately $1,409,000 for the three months ended September 30, 2025 from $330,000 for the three months ended September 30, 2024 due to grants of restricted stock units and stock options during the year ended September 30, 2025.
Sales of medical equipment and supplies The Company sells equipment, consumable supplies, and replacement parts to customers and recognizes revenue on delivery, as at that point all performance obligations have been met. Shipping and handling The Company provides shipping and handling at no charge in sending product to customers.
Rental revenue, less estimated adjustments, is recognized as earned on a straight-line basis over the noncancellable lease term. 49 Table of Contents Sales of medical equipment and supplies The Company sells equipment, consumable supplies, and replacement parts to customers and recognizes revenue on delivery, as at that point all performance obligations have been met.
Overview Quipt business objective The growth in the number of elderly patients in the US healthcare market is creating pressure to provide more efficient delivery systems. Healthcare providers, such as hospitals, physicians, and pharmacies, are seeking partners that can offer a range of products and services that improve outcomes, reduce hospital readmissions, and help control costs.
Healthcare providers, such as hospitals, physicians, and pharmacies, are seeking partners that can offer a range of products and services that improve outcomes, reduce hospital readmissions, and help control costs. Quipt fills this need by delivering a growing number of specialized products and services to achieve these goals.
The Medicare 75/25, which had been providing rate relief for certain geographies, was discontinued ‎ as of January 1, 2024‎. Although this change is still under legislative review, and could return, its immediate cessation had a negative impact ‎on our operating results ‎for the fiscal year ended September 30, 2024.
This blended rate was implemented to counter the decline in reimbursement rates experienced in the years prior to 2020. T he discontinuance is still under legislative review, and Medicare 75/25 could return, but the cessation on January 1, 2024 had a negative impact ‎on our revenue and operating results in the fiscal year ended September 30, 2025.
The net book value of the underlying asset is adjusted to fair value if the sum of the expected discounted cash flows is less than book value. Fair values are based on estimates of market prices and assumptions concerning the amount and timing of estimated future cash flows and discount rates, reflecting varying degrees of perceived risk.
Fair values are based on estimates of market prices and assumptions concerning the amount and timing of estimated future cash flows and discount rates, reflecting varying degrees of perceived risk. The Company did not have any long-lived asset impairments in the years ended September 30, 2025 or 2024.
Right-of-use operating lease amortization and interest decreased slightly to $1,362,000 for the three months ended September 30, 2024 from $1,450,000 for the three months ended September 30, 2023. Depreciation expense Depreciation expense increased by $7,589,000 to $38,490,000 for the year ended September 30, 2024.
Right-of-use operating lease amortization and interest increased by $319,000 to $1,681,000 for the three months ended September 30, 2025 from $1,362,000 for the three months ended September 30, 2024. The increase was due to new locations and, to a lesser extent, the impact of the acquisitions during the three months ended September 30, 2025.
The risk premiums expected by market participants related to uncertainties about the industry and assumptions relating to future cash flows may differ or change quickly, depending on economic conditions and other events. Equity method investee In July 2023, the Company, through QHM Investments I, LLC, acquired an 8.3% ownership in DMEScripts, LLC for $1,500,000.
The risk premiums expected by market participants related to uncertainties about the industry and assumptions relating to future cash flows may differ or change quickly, depending on economic conditions and other events. Foreign currency transactions Transactions in foreign currencies are initially recorded at the foreign currency spot rate or the rate realized in the transaction.
Non-GAAP measures Throughout this MD&A, references are made to a measure which is believed to be meaningful in the assessment of the Company’s performance. This metrics is a non-standard measure under GAAP and may not be identical to similar measures reported by other companies.
This is related to the Company acquiring a 60% ownership interest in Hart during the three months ended September 30, 2025. Non-GAAP measures Throughout this MD&A, references are made to a measure which is believed to be meaningful in the assessment of the Company’s performance.
After $3.3 million of issuance costs, the net proceeds of $27.9 million was used to: - retain $10.9 million for working capital, general corporate requirements, and future acquisitions. - repay the then-outstanding $14.0 million balance on the revolving credit facility - acquire Southern Pharmaceutical Corporation for a net $3.0 million at closing Proceeds have been used as intended. ​ ​ Financial Position The following table is the Company’s summarized financial position as of September 30, 2024 and 2023 (in $thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ As of ​ As of ​ September 30, 2024 September 30, 2023 Cash ​ $ 16,174 ​ $ 17,209 Accounts receivable, inventory and prepaid assets ​ 56,880 ​ 48,224 Property and equipment ​ 37,385 ​ 35,503 Right of use assets, net ​ ​ 16,475 ​ ​ 17,902 Other assets ​ 120,334 ​ 128,570 Total assets ​ $ 247,248 ​ $ 247,408 ​ ​ ​ ​ ​ ​ ​ Accounts payable and other current liabilities ​ $ 60,850 ​ $ 60,574 Long-term liabilities ​ 79,207 ​ 75,719 Total liabilities ​ 140,057 ​ 136,293 Shareholders’ equity ​ 107,191 ​ 111,115 Total liabilities and shareholders’ equity ​ $ 247,248 ​ $ 247,408 ​ Liquidity and Capital Resources The Company’s primary source of liquidity is cash on hand and its line of credit availability.
Proceeds have been used as intended. ​ ​ 43 Table of Contents Financial Position The following table is the Company’s summarized financial position as of September 30, 2025 and 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ As of ​ As of ​ ​ ​ ​ September 30, 2025 ​ ​ ​ September 30, 2024 Cash ​ $ 12,916 ​ $ 16,174 Accounts receivable, inventory and prepaid assets ​ 65,433 ​ 56,880 Property and equipment ​ 46,056 ​ 37,385 Right of use assets, net ​ ​ 18,393 ​ ​ 16,475 Goodwill and intangible assets, net ​ 139,120 ​ 118,686 Other assets ​ ​ 1,371 ​ ​ 1,648 Total assets ​ $ 283,289 ​ $ 247,248 ​ ​ ​ ​ ​ ​ ​ Accounts payable and other current liabilities ​ $ 74,708 ​ $ 60,850 Long-term liabilities ​ 96,484 ​ 79,207 Total liabilities ​ 171,192 ​ 140,057 Shareholders’ equity ​ 112,097 ​ 107,191 Total liabilities and shareholders’ equity ​ $ 283,289 ​ $ 247,248 ​ Liquidity and Capital Resources The Company’s primary source of liquidity is cash on hand and its line of credit availability.
This increase is due to the full year impact of the acquisitions during the year ended September 30, 2023 and other increases to property, equipment, and right-of-use assets. Depreciation expense increased by $533,000 to $10,016,000 for the three months ended September 30, 2024.
Depreciation expense increased by $353,000 to $10,369,000 for the three months ended September 30, 2025 from $10,016,000 for the year ended September 30, 2024. The increase was primarily due to approximately $800,000 from the acquisitions during the three months ended September 30, 2025 offset by decreases in rental equipment depreciation due to the timing of additions.
With over 140 offices, Quipt employs more than 1,200 personnel in the US. 35 Table of Contents Future outlook Our priority continues to be the generation of operational net profit, positive cash flow, and growth in Adjusted EBITDA, a non-GAAP financial measure defined below, in fiscal year 2025 and beyond.
Future outlook Our priority continues to be the generation of operating profit, positive cash flow, and growth in Adjusted EBITDA, a non-GAAP financial measure which is defined below, in fiscal year 2026 and beyond. As we continue to expand in our existing markets, we plan to leverage our business platforms to enter new markets and expand our product offerings.
This increase is primarily due to the full year benefit of acquisitions during the year ended September 30, 2023. For the three months ended September 30, 2024, revenue totaled $61,332,000, an increase of $1,684,000, or 3%, from the three months ended September 30, 2023.
For the three months ended September 30, 2025, revenue totaled $68,313,000, an increase of $6,981,000, or 11.4%, from the three months ended September 30, 2024. This increase is primarily due to $7,300,000 contributed by the acquisitions during the three months ended September 30, 2025, which was partially offset by the challenges discussed in the Operating Results above.
The increase in dollars was due to the growth in revenues but increased by a larger percentage than revenues due to a higher mix of sales of medical equipment and supplies relative to total revenue. For the three months ended September 30, 2024, inventory sold totaled $17,924,000 versus $16,283,000 for the three months ended September 30, 2023.
For the three months ended September 30, 2025, inventory sold totaled $20,406,000, a 15.5% increase from $17,664,000 for the three months ended September 30, 2024. The increase in dollars was due to the growth in revenues.
The Company faces minimal liquidity risk in its current financial obligations as they become due and payable. 42 Table of Contents Cash Flows The following is a summary of the Company’s cash flows for the following periods: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the three For the three For the For the ​ months ended ​ months ended ​ year ended ​ year ended ​ ​ September 30, ​ September 30, ​ September 30, ​ September 30, ​ 30, 2024 ​ 30, 2023 ​ 30, 2024 ​ 30, 2023 Net cash flow provided by operating activities ​ $ 6,739 ​ $ 9,668 ​ $ 35,381 ​ $ 36,980 ​ Net cash flow used in investing activities ​ (3,363) ​ (6,081) ​ (10,313) ​ (82,825) ​ Net cash flow provided by (used in) financing activities ​ (1,794) ​ (6,501) ​ (26,147) ​ 54,430 ​ Effect of exchange rate changes on cash held in foreign currencies ​ ​ 189 ​ ​ (322) ​ ​ 44 ​ ​ 108 ​ Net increase (decrease) in cash ​ $ 1,771 ​ $ (3,236) ​ $ (1,035) ​ $ 8,693 ​ ​ Capital management The Company considers its capital to be shareholders’ equity, which totaled $107,091,000 as of September 30, 2024, and the senior credit facility with a principal amount of $69,223,000 as of September 30, 2024.
Cash Flows The following is a summary of the Company’s cash flows for the following periods (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the three ​ ​ ​ For the three ​ ​ ​ For the ​ ​ ​ For the ​ ​ ​ ​ months ended ​ months ended ​ year ended ​ year ended ​ ​ September 30, ​ September 30, ​ September 30, ​ September 30, ​ ​ ​ ​ 2025 ​ 2024 ​ 2025 ​ 2024 Net cash flow provided by operating activities ​ $ 9,778 ​ $ 6,739 ​ $ 37,692 ​ $ 35,381 ​ Net cash flow used in investing activities ​ (23,334) ​ (3,363) ​ (32,945) ​ (10,313) ​ Net cash flow provided by (used in) financing activities ​ 15,239 ​ (1,794) ​ (7,758) ​ (26,147) ​ Effect of exchange rate changes on cash held in foreign currencies ​ ​ (17) ​ ​ 189 ​ ​ (247) ​ ​ 44 ​ Net increase (decrease) in cash ​ $ 1,666 ​ $ 1,771 ​ $ (3,258) ​ $ (1,035) ​ ​ Operating Activities Net cash flow provided by operating activities was $37,692,000 for the year ended September 30, 2025, an increase of $2,311,000 from $35,381,000 for the year ended September 30, 2024.
While cash collections increased during the six months ended September 30, 2024, we do not believe that we have fully collected certain accounts receivable from the backlog of submitted claims, estimated to be approximately $3,000,000, including collections of claims not directly impacted by the‎ Change Healthcare Incident that were slowed by the diversion of normal collection efforts to address this issue.
This incident significantly impacted the healthcare industry and hindered the ability to process and bill claims during the three months ended March 31, 2024 and June 30, 2024, creating a reduction in our cash flow, including collections of claims not directly impacted by the‎ Change Healthcare Incident that were slowed by the diversion of normal collection efforts to address the Change Healthcare Incident.
The Company did not have any long-lived asset impairments in the years ended September 30, 2024 or 2023. Goodwill impairment The Company tests goodwill for impairment on an annual basis on July 1, or more frequently if an event occurs or circumstances change that would indicate that impairment may exist.
Goodwill impairment The Company tests goodwill for impairment on an annual basis on July 1, or more frequently if an event occurs or circumstances change that would indicate that impairment may exist. The Company determines the fair value of our reporting unit using the income approach and market approach to valuation, as well as other generally accepted valuation methodologies.
Professional fees related to the CID and the loss in foreign private issuer status contributed $3,298,000, with other increases primarily related to payroll and outbound freight related to the resupply business. For the three months ended September 30, 2024, operating expenses were $31,446,000, an increase of $2,755,000 from $28,691,000 for the three months ended September 30, 2023.
For the three months ended September 30, 2025, operating expenses were $34,125,000, an increase of $2,679,000 from $31,446,000 for the three months ended September 30, 2024. The acquisitions during the three months ended September 30, 2025, contributed approximately $3,500,000 to the increase in operations.
Moreover, in certain regions, we also experienced the withdrawal of Medicare Advantage members due to a capitated agreement engaged with other providers in the industry. We estimate the revenue impact of these items to be a reduction of approximately $5,000,000 for the fiscal ‎year ended September 30, 2024.
Beginning during the fiscal year ended September 30, 2024 and continuing into the fiscal year end September 30, 2025, we also experienced the withdrawal of Medicare Advantage members due to a capitated agreement moving to other providers in the industry. Further, in November 2024, a disposable supply contract which the Company was a party to was not renewed.
While the costs are expected to be recurring if the Company continues to make acquisitions, they are generally incurred prior to the inclusion of such acquisitions in the consolidated revenues of the Company. ● The change in fair value of derivative liability – interest rate swap is added back because it is non-cash in the period of change in the fair value. 40 Table of Contents The following table is a reconciliation of net loss to Adjusted EBITDA for the indicated periods‎ (amounts in thousands of $): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the three For the three For the For the ​ ​ months ended ​ months ended ​ year ended ​ year ended ​ ​ September ​ September ​ September ​ September ​ ​ 30, 2024 ​ 30, 2023 ​ 30, 2024 ​ 30, 2023 Net loss ​ $ (3,211) ​ $ (1,326) ​ $ (6,763) ​ $ (2,784) Add back: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ 11,537 ​ ​ 10,936 ​ 44,581 ​ ​ 36,098 Right-of-use operating lease amortization and interest ​ ​ 1,362 ​ ​ 1,450 ​ — 5,974 ​ ​ 5,131 Interest expense, net ​ 1,524 ​ ​ 1,610 ​ 6,381 ​ ​ 5,541 Provision (benefit) for income taxes ​ (273) ​ ​ 75 ​ 109 ​ ​ 85 Professional fees related to CID ​ ​ 937 ​ ​ — ​ ​ 3,143 ​ ​ — Professional fees related to loss of foreign private issuer status ​ ​ 155 ​ ​ — ​ ​ 155 ​ ​ — Stock-based compensation ​ 330 ​ 1,369 ​ 2,484 ​ 5,280 Acquisition-related costs ​ 7 ​ 137 ​ 401 ​ 1,269 Loss on extinguishment of debt ​ ​ — ​ ​ — ​ ​ — ​ ​ 30 Gain (loss) on foreign currency transactions ​ (188) ​ 322 ​ (43) ​ (108) Change in fair value of derivative liability - interest rate swap ​ ​ 1,122 ​ ​ — ​ ​ 1,122 ​ ​ — Share of loss in equity method investment ​ ​ 67 ​ ​ 89 ​ ​ 309 ​ ​ 89 Adjusted EBITDA ​ $ 13,369 ​ $ 14,662 ​ $ 57,853 ​ $ 50,631 ​ Use of Proceeds On November 12, 2021, the Company filed and obtained a receipt for its final short form base shelf prospectus (the ‎‎“Final Shelf Prospectus”) ‎with the securities commissions in each of the provinces and territories of Canada, and a ‎corresponding registration ‎statement on Form F-10 (the “Registration Statement”) with the SEC under the ‎US/Canada Multijurisdictional Disclosure System.‎ The Final Shelf Prospectus and corresponding Registration ‎Statement allow Quipt to undertake offerings of ‎common shares, preferred shares, debt securities, warrants, ‎subscription receipts and units (collectively, the “Securities”), or any combination thereof, up to an aggregate total ‎of C$200,000,000 from time to time during the ‎‎25-month period that the Final Shelf Prospectus remains effective. ‎The Final Shelf Prospectus expired December 12, 2023.
While the costs are expected to be recurring if the Company continues to make acquisitions, they are generally incurred prior to the inclusion of such acquisitions in the consolidated revenues of the Company. ● The change in fair value of derivative liability – interest rate swaps and the share of loss in equity method investment are added back because it is non-cash in the period of change in the fair value. ● The gain on disposals of property and equipment is excluded because they are a recapture of previously depreciated property and equipment. ● The loss (gain) on foreign currency transactions is excluded because they are not a representative component of our day-to-day operations. 42 Table of Contents The following table is a reconciliation of net loss to Adjusted EBITDA for the indicated periods‎ (amounts in thousands of $): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the three ​ ​ ​ For the three ​ ​ ​ For the ​ ​ ​ For the ​ ​ months ended ​ months ended ​ year ended ​ year ended ​ ​ September ​ September ​ September ​ September ​ ​ 30, 2025 ​ 30, 2024 ​ 30, 2025 ​ 30, 2024 Net loss ​ $ (3,550) ​ $ (2,940) ​ $ (10,701) ​ $ (6,763) Add back: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ 11,874 ​ ​ 11,537 ​ 45,482 ​ ​ 44,581 Interest expense, net ​ 1,634 ​ ​ 1,524 ​ 6,277 ​ ​ 6,381 Right-of-use operating lease amortization and interest ​ ​ 1,681 ​ ​ 1,362 ​ — 6,434 ​ ​ 5,974 Provision (benefit) for income taxes ​ 141 ​ ​ (374) ​ 241 ​ ​ 109 Professional fees ​ ​ 1,263 ​ ​ 1,092 ​ ​ 4,348 ​ ​ 3,298 Stock-based compensation ​ 1,409 ​ 330 ​ 4,035 ​ 2,484 Acquisition-related costs ​ 596 ​ 137 ​ 817 ​ 401 Change in fair value of derivative liability - interest rate swap ​ ​ (10) ​ ​ 952 ​ ​ (452) ​ ​ 1,122 Gain on disposals of property and equipment ​ ​ (329) ​ ​ (55) ​ ​ (1,225) ​ ​ (107) Gain (loss) on foreign currency transactions ​ 136 ​ (188) ​ 367 ​ (43) Share of loss in equity method investment ​ ​ 79 ​ ​ 67 ​ ​ 324 ​ ​ 309 Adjusted EBITDA ​ $ 14,924 ​ $ 13,444 ​ $ 55,947 ​ $ 57,746 ​ Use of Proceeds The following table provides information about the Company’s recent debt and equity financings and the actual use of proceeds from those financings compared to the intended use of proceeds from the offerings. ​ ​ ​ ​ ​ ​ Date of Financing Type of Financing Gross Proceeds Initial Intended Use of Net Proceeds Actual Use of Net Proceeds to Date Explanation of Variance and Impact on Business Objectives September 2, 2025 $110.0 million facility consisting of delayed-draw term loan availability of $85.0 million, a term loan of $5.0 million, and $20.0 million revolving credit availability. $20.65 million, consisting of a $17.4 million draw on the delayed-draw term loan, and a $3.25 million draw on the revolving credit.
Quipt fills this need by delivering a growing number of specialized products and services to achieve these goals. Quipt seeks to provide an ever-expanding line of products and services over larger geographic regions within the US using several growth strategies.
Quipt seeks to provide an ever-expanding line of products and services over larger geographic regions within the US using several growth strategies. With over 175 offices, Quipt employs approximately 1,600 employees in the US. Recent transactions On July 1, 2025, we completed the acquisition of Mediserve, a Tennessee-based full-service durable medical equipment provider.
Real estate leases are valued at the net present value of the future lease payments at an incremental borrowing rate of 5.9% to 8.0%. Vehicle leases are recorded at rate implicit in the lease based on the current value and the estimated residual value of the vehicle, equating to rates ranging from 5.1% to 12.8%.
Lease Liabilities The Company enters into leases for real estate and vehicles. Real estate leases are operating leases and are valued at the net present value of the future lease payments at the incremental borrowing rate.
The leases have been entered into with terms between one and ten years, including optional extensions. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 1-3 4-5 After 5 ​ ​ Total ​ 1 year ​ Years ​ Years ​ Years Debt ​ $ 82,386 ​ $ 22,868 ​ $ 68 ​ $ 59,450 ​ $ — Finance lease obligations ​ ​ 22,134 ​ ​ 7,113 ​ ​ 12,430 ​ ​ 2,148 ​ ​ 443 Operating leases ​ ​ 114 ​ ​ 114 ​ ​ — ​ ​ — ​ ​ — Purchase obligations ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Other obligations ​ ​ 29,310 ​ ​ 29,310 ​ ​ — ​ ​ — ​ ​ — Total contractual obligations ​ $ 133,944 ​ $ 59,405 ​ $ 12,498 ​ $ 61,598 ​ $ 443 ​ ​
The leases have been entered into with terms between one and ten years, including optional extensions. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than ​ ​ ​ 1-3 ​ ​ ​ 3-5 ​ ​ ​ After 5 ​ ​ Total ​ 1 year ​ Years ​ Years ​ Years Debt ​ $ 99,798 ​ $ 16,532 ​ $ 83,266 ​ $ — ​ $ — Finance lease obligations ​ ​ 17,202 ​ ​ 6,548 ​ ​ 6,548 ​ ​ 3,328 ​ ​ 778 Operating leases ​ ​ 3,573 ​ ​ 1,531 ​ ​ 2,000 ​ ​ 42 ​ ​ — Other obligations ​ ​ 38,431 ​ ​ 38,431 ​ ​ — ​ ​ — ​ ​ — Total contractual obligations ​ $ 159,004 ​ $ 63,042 ​ $ 91,814 ​ $ 3,370 ​ $ 778 ​ ​
The Company uses its incremental borrowing rate of 6.0% to 8.0% to impute interest on these arrangements. The Company has also assumed equipment loans in conjunction with several of its acquisitions. There are no covenants with the loans.
In most cases, the supplier accepts a discounted amount from the financial institution and the Company repays the financial institution the face amount of the invoice with no stated interest, in twelve 46 Table of Contents equal monthly installments. The Company uses its incremental borrowing rate of 6.6% to 8.0% to impute interest on these arrangements.
Interest expense, net of interest income, decreased to $1,524,000 in the three months ended September 30, 2024 from $1,610,000 for the three months ended September 30, 2023, due to the benefit of the interest rate swaps.
The provision for income taxes was $141,000 for the three months ended September 30, 2025, as compared to a benefit for income taxes of $374,000 for the three months ended September 30, 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Based on the exposure of Canadian cash at September 30, 2024, depreciation or appreciation of the Canadian dollar against the US dollar could result in a significant effect on net income or loss. The Company has not employed any foreign currency hedging programs.
Based on the exposure of Canadian cash at September 30, 2025, depreciation or appreciation of the Canadian dollar against the US dollar could result in a significant effect on net income or loss. The Company has not employed any foreign currency hedging programs.
The Company monitors foreign currency exposures and from time to time could 51 Table of Contents authorize the use of derivative financial instruments such as forward foreign exchange contracts to economically hedge a portion of foreign currency fluctuations.
The Company monitors foreign currency exposures and from time to time could 52 Table of Contents authorize the use of derivative financial instruments such as forward foreign exchange contracts to economically hedge a portion of foreign currency fluctuations.
The Company’s objective in managing its foreign currency risk is to monitor foreign exchange rates and minimize its net exposures to foreign currency cash flows by generally holding most of its cash in US dollars. However, at times, including at September 30, 2024, the Company does temporarily hold significant cash in Canadian dollars.
The Company’s objective in managing its foreign currency risk is to monitor foreign exchange rates and minimize its net exposures to foreign currency cash flows by generally holding most of its cash in US dollars. However, at times, including at September 30, 2025, the Company does hold significant cash in Canadian dollars.
The interest on the Company’s other debt is either imputed or has a fixed rate and is not subject to cash flow interest rate risk. ​ 52 Table of Contents
The interest on the Company’s other debt is either imputed or has a fixed rate and is not subject to cash flow interest rate risk. ​ 53 Table of Contents
As of September 30, 2024, the Company has 13% of its accounts receivable with Medicare. As this is a US government program, we believe there is very little credit risk associated with these balances. No other customer represented more than 10% of outstanding accounts receivable.
As of September 30, 2025, the Company has 18% of its accounts receivable with Medicare. As this is a US government program, we believe there is very little credit risk associated with these balances. No customer represented more than 10% of outstanding accounts receivable.
During the year ended September 30, 2024, the Company entered into interest rate swap agreements whereby $59,000,000 of principal will receive a fixed rate. With $69,223,000 of borrowings on this facility at September 30, 2024, each 1% increase would result in an additional $10,223 of annual interest expense.
The Company has entered into interest rate swap agreements whereby $54,000,000 of principal will receive a fixed rate during the year ended September 30, 2025. With $87,583,000 of borrowings on this facility at September 30, 2025, each 1% increase would result in an additional $335,830 of annual interest expense.
During the twelve months ended September 30, 2024, the Company recognized a foreign currency gain of approximately $43,000, due to favorable movements in the exchange rates.
During the twelve months ended September 30, 2025, the Company recognized a foreign currency loss of approximately $367,000 due to unfavorable movements in the exchange rates.