HESKA CORPORATION INVESTOR PRESENTATION
HSKA JANUARY 2020
01 SAFE HARBOR NOTICES This presentation contains forward-looking - - PowerPoint PPT Presentation
HESKA CORPORATION INVESTOR PRESENTATION HSKA JANUARY 2020 01 SAFE HARBOR NOTICES This presentation contains forward-looking information related to the Heska Corporation (the Company). This forward-looking information generally includes
HSKA JANUARY 2020
This presentation contains forward-looking information related to the Heska Corporation (the “Company”). This forward-looking information generally includes statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. All of the statements in this document, other than historical facts, are forward-looking statements and are based on a number of assumptions that could ultimately prove inaccurate and cause actual results to materially deviate from forward-looking statements. Forward-looking statements in this document include, among other things, statements with respect to future sales, sales split percentages, sales geography percentages, market share, and strategic goals, the expected timing of the scil Acquisition and its funding and its anticipated benefits; the expected conversion of the Preferred Shares into shares of Public Common Stock; anticipated investments and growth; and the number of customers that the Company will be able to acquire and retain. Such statements are subject to risks and uncertainties, including, but not limited to, uncertainties related to the closing of the Acquisition; the obtaining of shareholder approval to increase the number of shares of Public Common Stock authorized by the Company’s Certificate of Incorporation; the ability to achieve the anticipated benefits of the Acquisition uncertainties related to supplier availability, competing suppliers, any product’s ability to perform and be recognized as anticipated, in particular when such product is under development; uncertainties related to Heska’s ability to sell and market its products in an economically sustainable fashion, including related to varying customs, cultures, languages and sales cycles and uncertainties with foreign political and economic climates; and the Company’s ability to integrate the acquired scil business within its existing operations; and new product development and release schedules. Other factors that could cause actual results to differ materially from those matters expressed in or implied by such forward-looking statements are set forth under “Risk Factors” in the Company’s most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q.
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2.6 2.6 2.6 3.3 Silent Generation Baby Boomers Gen X Millennials
Ave verage Canine Vet Visi sits s per Year by y Owner Age 27% increase
1,813 1,976 2,154 2,352 2,574 2017 2018 2019 2020 2021
Global Veterinary y Diagnost stics s Marke ket > $2 Billion
Amounts estimated. Source: American Pet Prod Assoc Generational Report; 2017-18 Pet Owners’ Survey; American Pet Products Association; Technavio Global Veterinary Diagnostics Market 2017-2021 report
DIAGNOSTICS IS CENTRAL L & SCARCE ≈ 2% ≈ 48% ≈ 50% North America a Reference Lab Lab Shar are ≈ 23% ≈ 12% ≈ 65% North America a POC Shar are
Information derived from publicly available information data disclosed by third-party sources, our own internal estimates based on such data, and our knowledge of the industry; it has not been independently verified and we cannot assure you of its accuracy or completeness. Our internal estimates have not been independently verified. While we are not aware of any misstatements regarding this information, we cannot guarantee its accuracy or completeness.
Information derived from publicly available information data disclosed by third-party sources, our own internal estimates based on such data, and our knowledge of the industry; it has not been independently verified and we cannot assure you of its accuracy or completeness. Our internal estimates have not been independently
accuracy or completeness. Source: American Pet Prod Assoc Generational Report; 2017-18 Pet Owners’ Survey; American Pet Products Association; Technavio Global Veterinary Diagnostics Market 2017-2021 report
Heartworm Therapeutic Heartworm Diagnostic Element DC Chemistry Vet/IV Infusion Pump Element DC5X Chemistry Element RC Chemistry Element HT5 Hematology Element i+ Immunoassay Element POC Gas & E-M Lyte Element COAG Coagulation Element UF Urine & Fecal Cloud Data Solution Hospital Digital Radiography Portable Digital Radiography Digital Ultrasound Allergy Diagnostic Immunotherapy
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Digital Endoscopy
2015 2015 2016 2016 2017 2017 2018 2018 Subscriptions 1,239 1,667 1,950 2,175 % growth N/A 35% 17% 12% Months under subscription 54,200 68,750 75,950 90,850 % growth N/A 27% 10% 20% Monthly contract subscription value2 $701 $742 $743 $792 % growth N/A 13% 0% 7%
1 Includes Corporate Accounts estimates similar to individual accounts CSV (Contract Subscription Value). 3 As of December 31, 2018. 2 Represents minimum contract subscription value / subscription months
$38.0 $51.0 $56.4 $72.0
24% 24% C CAGR
+3 +34% +1 +11% +2 +28%
Information from Heska data and internal estimates of scil data provided to Heska from scil. Direct Sales teams include RM, TM, ISAM, FSR, Imaging, Sales Management, and Other. Heska has not independently verified the data from third party and cannot assure its accuracy or completeness, and Heska internal and scil estimates have not been independently verified. Sales estimate based on scil closing date on or before April 1, 2020, adjustments anticipated for equipment portion of revenue recognition under subscriptions agreements, integration effects, and other variabilities; estimate may materially deviate from actual performance. While Heska is not aware of any misstatements regarding this information, Heska cannot guarantee its accuracy or completeness. Information regarding future sales are forward-looking statements and actual results can materially differ from those noted, due to several factors, including but not limited to market, currency, integration, supplier, distributor, scil, and Heska performance and those mentioned in Safe Harbor and forward-looking statements disclaimer herein.
Starting Cash and Combined Debt starting balance as of September 30, 2019. Acquisition of scil calculated on “debt free – cash free”. Market Cap starting balance from January 14, 2020 ($757.2MM) plus $125MM for scil Acquisition financing. Amounts unaudited. While we are not aware of any misstatements regarding this information, we cannot guarantee its accuracy or completeness.
$125MM for scil Acquisition financing. For more information see Company press release dated January 14, 2020.
Information regarding market share and market position is derived from data from publicly available information disclosed by third party sources and Heska internal estimates based on such data, scil data, and Heska’s knowledge of the industry. Heska has not independently verified the data from third party sources and cannot assure its accuracy or completeness, and Heska internal and scil estimates have not been independently verified. Data specifically excludes items not point of care, including central reference laboratories and single use “rapid” tests. While Heska is not aware of any misstatements regarding this information, Heska cannot guarantee its accuracy or completeness. Information regarding future sales, sales split percentages, sales geography percentages, and goals are forward-looking statements and actual results can materially differ from those noted, due to several factors, including but not limited to market, currency, integration, supplier, distributor, scil, and Heska performance and those mentioned in Safe Harbor and forward-looking statements disclaimer herein.
Information regarding market share and market position is derived from data from publicly available information disclosed by third party sources and Heska internal estimates based on such data, scil data, and Heska’s knowledge of the industry. Heska has not independently verified the data from third party sources and cannot assure its accuracy or completeness, and Heska internal and scil estimates have not been independently verified. Data specifically excludes items not point of care, including central reference laboratories and single use “rapid” tests. While Heska is not aware of any misstatements regarding this information, Heska cannot guarantee its accuracy or completeness. Information regarding future sales, sales split percentages, sales geography percentages, and goals are forward-looking statements and actual results can materially differ from those noted, due to several factors, including but not limited to market, currency, integration, supplier, distributor, scil, and Heska performance and those mentioned in Safe Harbor and forward-looking statements disclaimer herein.
USA 55% Europe 37% RoW 2% Canada 7% RoW 2% Canada 2% Europe 5% USA 91%
numerous other factors outlined in the Company’s press release of January 14, 2020 and Safe Harbor in this presentation. Amounts not GAAP and are estimates; results may materially differ. Management believes this visual will assist investors to understand the Company’s business and strategy.
GAAP, segments, revenue recognition, and other information relevant to (1) and (2).
10% Lab 60% Imaging 30% Other Core Comp Animal
materially differ. Management believes this visual will assist investors to understand the Company’s business and strategy.
15% Lab 45% Imaging 18% Other Vaccine & Pharma Other Core Comp Animal 22%
7% Lab 60% Imaging 23% 10% Other Vaccine & Pharma Other Core Comp Animal
Company’s press release of January 14, 2020 and Safe Harbor in this presentation. Amounts not GAAP and are estimates; results may materially differ.
revenue recognition, and other information relevant to (1) and (2).
¹ 2017 U.S Tax Reform impacts of +/- ($5.9M) included, as further discussed in our Form 10- K/A for the year ended December 31,2017
$MM, except p/share Hesk Heska 2013 2013 Hesk Heska 2017 2017 Re Revenue $78.3 $129.3 Gr Gross margin n % 39% 45% Ope Operating ng margin n % (2%) 14% Ope Operating ng Inc ncome ($1.43) $18.2 Ea Earnings pe per sha hare ($0.21) $1.3¹ As Assets $93.6 $135.8 Eq Equity $47.1 $100.4
$MM, except p/share Hesk Heska 2013 2013 Hesk Heska 2017 2017 Sc Scil il-CV CVM 2020 2020 Es Estim imate Re Revenue $78.3 $129.3 < < $75. $75.0 Gr Gross margin n % 39% 45% < < 35% 35% Ne Net Revenue CAGR 10.2% Gr Gross Profit CAGR GR 13.1% Co Core Supplies CA CAGR 12.9%
¹ 2017 U.S Tax Reform impacts of +/- ($5.9M) included, as further discussed in our Form 10- K/A for the year ended December 31,2017
Roundworm, Hookworm, Tapeworm, Whipworm, Flukeworm, Giardia & more…
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