AdaptHealth (AHCO) investor relations material

Operational transformation and technology investments

• Decoupled sales force from operations, creating a core commercial organization and implementing a new commissions program, with further fine-tuning planned for 2026.

• Standardized the operating model across all regions, deploying more technology to unify processes from intake to delivery.

• Achieved record setup times, reducing average patient setup from 17-18 days to 9 days by leveraging AI chatbots and reinstating virtual setups.

• Over 300,000 patients registered on the app, enabling digital communication, reorders, and scheduling without staff intervention.

• Significant investments in infrastructure, including employees, vehicles, and equipment, to support the exclusive DME contract with Kaiser Permanente.

Business performance, growth, and portfolio management

• Record census growth in sleep, respiratory, and DME segments, driven by sales reconfiguration and operational improvements.

• Resupply operations set new records, with sleep and diabetes resupply outperforming industry averages (2.9x/year vs. 2.1-2.2x).

• Divested non-core business lines (home infusion, ActivStyle, Custom Rehab) to focus on core segments and pay down debt.

• Ongoing portfolio assessment may lead to further divestitures or new product introductions, especially in sleep and respiratory.

• Deployed over $40 million in tuck-in M&A in 2025, with similar activity possible in 2026 depending on market conditions.

Regulatory and industry landscape

• CMS imposed a six-month moratorium on new DME licenses due to fraud, impacting M&A for targets with recent ownership changes.

• Regulatory and inflationary pressures are making it harder for smaller DMEs to compete, favoring scaled, tech-enabled operators.

• Support for industry efforts to reduce fraud, waste, and abuse, viewing it as beneficial for consolidation and professionalism.