Span-America Awarded USD $1.9 Million Contract by City of Toronto’s Long Term Care Homes and Services Division
March 31 2016 - 11:00AM
Business Wire
Supply Contract Includes Span-America’s
Medical Bed Frames and Therapeutic Support Surfaces
Span-America Medical Systems, Inc. (NASDAQ: SPAN) announced
today that it has been awarded a supply contract by the City of
Toronto to provide medical bed frames, therapeutic support surfaces
and related services to the City’s Long Term Care Homes and
Services Division. The initial one-year contract has an estimated
value of approximately USD $1.9 million (CAD $2.5 million) and has
four one-year renewal options valued at an additional USD $8.4
million (CAD $11.0 million) over the remaining four years.
Commenting on the announcement, Jim Ferguson, president
and chief executive officer of Span-America, stated, “We are
very excited to be selected by the City of Toronto to supply our
proprietary medical bed frames and support surfaces to their Long
Term Care Homes and Services Division. This division currently
operates 10 long-term care facilities that include approximately
2,641 beds.
“The supply contract is for a one-year term and has four
additional one-year renewal options. We expect to begin delivery of
support surfaces to the City’s Long Term Care Homes and Services
Division by late June or early July 2016. Our sales volume is not
guaranteed under the contract, but we expect the contract will add
at least approximately USD $450,000 to fiscal 2016 sales based on
initial estimates.
“Our wholly-owned subsidiary, Span Medical Products Canada,
Inc., received the supply contract from the City of Toronto,”
continued Ferguson. “This significant award highlights the sales
momentum we have achieved by combining opportunities to sell our
medical bed frames and support surfaces. We believe the combined
product line has increased our bidding opportunities with long-term
care providers, the Veteran’s administration and other buyers
seeking a single-source provider for high quality medical beds and
therapeutic support surfaces. We experienced our best year of
combined bed and support surface sales in fiscal 2015, and we look
forward to building on that success and continuing our momentum in
the future.
“We expect to provide two different therapeutic support surfaces
with our newly designed Encore® premium bed frame to the City of
Toronto’s Long Term Care Homes and Services Division. They include
our Geo-Mattress® UltraMax, a reactive pressure redistribution
support surface, and our PressureGuard® Custom Care® Convertible
LAL that features microclimate management, alternating pressure and
lateral rotation for pressure redistribution. When combined with
the Encore® bed, we believe our systems will result in improved
levels of care and comfort for the patient and better ergonomics
and protection from injury for the caregiver,” concluded
Ferguson.
Forward-Looking Statements
We have made forward-looking statements in this release
regarding, among other things, our expectations for future sales
performance. We wish to caution the reader that these statements
are only predictions. These forward-looking statements may be
generally identified by the use of forward-looking words and
phrases such as “will,” “intends,” “may,” “believes,”
“anticipates,” “should” and “expects,” and are based on the
company’s current expectations or beliefs concerning future events
that involve risks and uncertainties. Actual events or results may
differ materially as a result of risks and uncertainties facing the
company, including: (a) the possibility that sales volumes under
the new contract will be lower than expected, (b) the possibility
of a loss of a key customer or distributor for our products, (c)
risks related to international operations and foreign currency
exchange associated with our Canadian subsidiary, (d) the potential
for lost sales due to competition from low-cost foreign imports,
(e) changes in relationships with large customers or key suppliers,
(f) the impact of competitive products and pricing,
(g) government reimbursement changes in the medical market,
(h) FDA and Health Canada regulation of medical device
manufacturing and (i) other risks referenced from time to time
in our Securities and Exchange Commission filings. We disclaim any
obligation to update publicly any forward-looking statement,
whether as a result of new information, future events or otherwise.
We are not responsible for changes made to this document by wire
services or Internet services.
About Span-America Medical Systems, Inc.
Span-America manufactures and markets a comprehensive selection
of pressure management products for the medical market, including
Geo-Matt®, PressureGuard®, Geo-Mattress®, Custom Care®, Span+Aids®,
Isch-Dish®, Risk Manager® and Selan® products. We also supply
custom foam and packaging products to the consumer
and industrial markets. Through our
wholly-owned subsidiary Span Medical Products Canada Inc., we
manufacture and market the M.C. Healthcare Products
brands of Encore®, Advantage and Rexx beds as well as related
in-room furnishing products for the long-term care market.
Span-America’s stock is traded on The NASDAQ Global
Market under the symbol “SPAN.” For more information, visit
www.spanamerica.com and www.mchealthcare.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20160331005936/en/
Span-America Medical Systems, Inc.Jim Ferguson, 864-288-8877,
ext. 6912President and Chief Executive Officer
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