Guardian Pharmacy Services, Inc. Healthcare Services and Technology Conference

Brian, thank you. It's great.

Well, this is a great conference that you've put together. It's been really productive for us.

I appreciate that. Thank you for including us.

Well, we had a very momentous first half in that we implemented the IRA and the fixes that we had negotiated for that. And proud to say that the forecasting that we had done with our data analytics platform panned out to be the case. A lot of changes, a lot of moving parts, but I am very proud of our company and its skill set to be able to predict something like that.

We are a specialty institutional pharmacy that focuses our service on assisted living facilities, who require a completely different type of service than what most long-term care pharmacies are geared to serve, which is skilled nursing facilities. We've been at this for 22 years. We were founded 22 years ago with this in mind, and we've grown step by step over this past two decades, planting flags and now serving 38 states. We grow both organically, which is very important in our DNA. We do that by selling new assisted living facilities to use our pharmacy service. And marginally, we've benefited from industry tailwinds, such as the occupancy rebound from COVID. And we focus on an important service to assisted living, which is to have a high adoption rate of residents using the pharmacy service.

And then we have benefited greatly from growth through contiguous greenfield startups, and we do M&A. So we've grown from the one initial pharmacy to 60 or so today.

It is complicated by the IRA. Let's pretend the IRA didn't exist. Our growth algorithm is we feel like we can grow organically in the highest single digits, and we have done that since inception. We do that through the things I mentioned before, selling new facilities to use our pharmacy service and the contiguous greenfield startups, increasing the adoption rate from when we take on the facility up to our corporate average of 90%, and at the margin, a little bit of benefit from the occupancy rebound. We augment that growth with M&A and have been able to deliver since inception mid double digit, mid-teens growth. But we are looking and guiding to low teen revenue growth. All of that is assuming the IRA didn't exist. We have this one-time anomaly, really three-time anomaly with the three tranches, that is arresting reported revenue growth.

In the first half of the year, we grew 2% revenue, but if you were to adjust it for the effect of the IRA, it would be the low double digit that I just mentioned. Down on the EBITDA, it is a different story. Here, it is driven almost exclusively by organic because most of the acquisitions come on board with a very low profitability level.