Physitrack: Enhances its holistic care offering - ABG

Acquires a leading digital workplace health platform
Adding (at least) 3.2% to sales in ’22e
Pays 7.3x EV/sales, based on run rate sales of EUR 0.4m

Champion Health - a leading workplace health platform
Physitrack has acquired Champion Health, a leading workplace health platform based in the UK. Champion Health is a technology platform for the wellness market for SME and corporates, offering a tailored personal plan via its wellness content platform. The acquisition of Champion Health is in line with Physitrack’s M&A strategy and enhances its focus on holistic wellbeing. Moreover, Physitrack broadens its virtual-first care offerings by adding Champion Health to the group. We particularly like that over 95% of Champion Health’s revenue is recurring.
Pays GBP 2.5m upfront with a further potential earn-out Physitrack will pay a total cash consideration of GBP 2.5m upfront and a further potential aggregate earn-out consideration of up to GBP 7.894m over four years. Champion Health exited April 2022 with a revenue run rate of EUR 0.4m, higher than the EUR 0.1m that Champion Health delivered in 2021. Based on the revenue run rate, the acquisition corresponds to an EV/sales multiple of 7.3x (30x including the potential earn-out). On a standalone basis, management expects Champion Health to execute growth significantly above 30%, which makes us believe the transaction multiples to be lower. Moreover, Champion Health’s EBITDA margin is ~30%, in line with our expectation of 33% for Physitrack’s adj. EBITDA margin in 2022e. Initial one-off acquisition and integration costs are estimated by management to reach around EUR 0.3m over six months.
Great fit for the wellness focus We believe that Champion Health will be a great fit for Physitrack since it broadens Physitrack's virtual care focus with a holistic health and wellness product. We especially believe that this will drive the expansion of Access, Physitrack’s wellness and preventive offering. The company also states that this ...
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