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Sales of Microchips and Database Related Services Led the Way in Pethealth's Non-Insurance Business in 2012

OAKVILLE, ONTARIO -- (Marketwire) -- 01/18/13 -- Pethealth Inc. ("Pethealth" or the "Company") (TSX:PTZ) saw continued growth in its non-insurance operations in 2012, led by its microchipping operations in the United States, Canada and the United Kingdom.

Microchip sales for 2012 totalled 1,509,645, up 14% over 2011. All three countries where the Company sells microchips for companion animal use recorded record sales. Supporting the business was the launch in Q1 of the MiniChip. The MiniChip, exclusive to the Company in 2012, is one-third the size of the standard microchip which is itself approximately the size of a grain of rice. The MiniChip, like the standard sized microchip which accounted for the bulk of sales in 2012, is manufactured by Allflex USA, Inc., the world leader in design, technology, manufacturing, and distribution of animal identification systems for traceability purposes.

As of December 31, 2012, the Company's cloud-based animal management system called PetPoint had been licensed by 1,955 animal welfare organizations in the United States and Canada, representing an increase of 182 organizations over the number licensed as of December 31, 2011. Included in this group were Central California SPCA, Calgary Humane Society and Dekalb County Animal Services and Enforcement.

Dekalb County, a municipally owned organization in Georgia, is representative of the growing trend amongst municipally owned animal control organizations to move to PetPoint to take advantage of the Company's hosted application. Whereas previously, municipally owned organizations were reluctant or were prohibited from having third parties host their data, financial pressures on municipal budgets as well as the growing trend towards cloud applications are leading many of these organizations to join the already large number of 501c3 animal shelters to license the Company's software. As of December 31, 2012, a total of 255 municipally owned animal welfare organizations made up the 1,955 organizations in total that have now licensed PetPoint.

While the Company continues to offer two free versions of the software, PetPoint Lite and PetPoint 4.0, the Company did introduce in 2012 a pay-as-you-go version called PetPoint Enterprise Phase 1. By December 31, 2012, 88 organizations had signed license agreements to pay for the Company's industry leading software. Animal intakes recorded in 2012 totalled 2.34-million, an increase of 4% over 2011. Adoptions recorded through PetPoint totalled 973,000, an increase of 9% over 2011.

As of December 31, 2012, the Company held records for over 17-million animals, including 12.6 million vaccinations and 2 million spay/neuter surgeries in its position as the largest aggregator of shelter data. The Company monetizes its platform on both a BtoB and BtoC basis, offering in addition to microchips a growing range of pet pharmacy products to be used by shelters in their day-to-day operations. Included was the launch of the partnership in 2012 with Velcera, Inc., the parent company of FidoPharm, Inc., in which Pethealth began distributing PetArmor and PetTrust Plus, FidoPharm's flea/tick and heartworm medications.

The Company monetizes adoptions through a range of consumer focused programs, including its pet health insurance sold in 2012 under the ShelterCare and 24PetWatch brand names and pet pharmacy and pet specialty retail products through its PetangoStore.com web site and via a growing number of white labelled stores created in partnership with its animal welfare partners. As of December 31, 2012, five white labelled stores had been completed, including those for San Antonio Humane Society and Pennsylvania SPCA.

Total pet and pet owner registrants in the 24PetWatch database had surpassed 6.38-million as of December 31, 2012, an increase of 21% over the total as at December 31, 2011. The 24PetWatch database plays a key role in Pethealth's insurance and non-insurance businesses alike and is supported by a call centre that had an average of nearly 20,000 per month in 2012.

Inbound calls to the Company's non-insurance call centre totaled over 232,000 during the twelve months ended December 31, 2012. The Company recorded over 90,000 sales, up 20% over 2011, of identification tags, EmergencyCare policies and annual and lifetime memberships to the Company's lost pet recovery service, representing a 39% conversion rate of sales against inbound calls received.

"In 2012, our non-insurance business continued to lead the way for the Company," said Mark Warren, President and CEO of Pethealth. "We saw year on year growth in every quarter, which we believe is set to continue on the back of our broadening platform with animal welfare organizations in North America and our growing presence in the companion animal market in the United Kingdom."

The Company expects to release its full year 2012 financial results on or about March 8, 2013. Additionally, the Company will be releasing its PetPoint Report for December on Monday, January 21 together with its 2012 year-end release, providing more detailed information on pet intake and pet adoption data.

About Pethealth Inc.

Pethealth is North America's second largest provider of medical insurance for dogs and cats to pet owners, operating in the United States, Canada and the United Kingdom. In addition, the Company is the leading provider of management software to North American animal welfare organizations through its SaaS-based application and is the leading provider of pet related database management services to the North American companion animal industry. Pethealth offers a unique range of products and services for veterinarians, shelters and pet owners through a number of wholly owned subsidiaries using a range of brand names including PetCare, 24PetWatch, Pet Protect, Petpals Direct, PetPoint, Petango.com and ThePetangoStore.com.

Pethealth is based in Oakville, Ontario. To find out more about Pethealth, visit the web site at www.pethealthinc.com.

Contacts:
Pethealth Inc.
Mark Warren
President and Chief Executive Officer
(905) 842 2615

Pethealth Inc.
Glen Tennison
Chief Financial Officer
(905) 842 2615
www.pethealthinc.com

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