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Vir tus He alth Annua l Ge ne r a l Me e ting CE O Pr e se nta - - PowerPoint PPT Presentation

Vir tus He alth Annua l Ge ne r a l Me e ting CE O Pr e se nta tion 6 Nove mbe r 2013 Sue Cha nnon Disc laime r The material in this presentation has been prepared by Virtus Health Limited ABN 80 129 643 492 (Virtus Health) and


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Vir tus He alth

6 Nove mbe r 2013 Annua l Ge ne r a l Me e ting – CE O Pr e se nta tion Sue Cha nnon

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SLIDE 2

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Disc laime r

The material in this presentation has been prepared by Virtus Health Limited ABN 80 129 643 492 (“Virtus Health”) and is general background information about Virtus Health’s activities current at the date of this presentation. The information is given in summary form and does not purport to be complete. Information in this presentation, including forecast financial information should not be considered as advice or a recommendation to investors or potential investors and does not take into account investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate. Persons needing advice should consult their stockbroker, solicitor, accountant or other independent financial advisor. The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about and observe such restrictions. This presentation does not constitute, or form part of, an offer to sell or the solicitation of an offer to subscribe for or buy any securities, nor the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issue or transfer of the securities referred to in this presentation in any jurisdiction in contravention

  • f applicable law.

Certain statements made in this presentation are forward-looking statements. These forward-looking statements are not historical facts but rather are based on Virtus Health Limited’s current expectations, estimates and projections about the industry in which Virtus Health operates, and beliefs and assumptions. Words such as "anticipates”, "expects”, "intends,", "plans”, "believes”, "seeks”, "estimates”, and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the control of Virtus Health, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward- looking statements. Virtus Health cautions investors and potential investors not to place undue reliance on these forward-looking statements, which reflect the view of Virtus Health only as of the date of this presentation. The forward-looking statements made in this presentation relate only to events as of the date on which the statements are made. Virtus Health will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances or unanticipated events occurring after the date of this presentation except as required by law or by any appropriate regulatory authority.

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Virtus He alth Ove rvie w

  • Austra lia n le a de r in Assiste d Re produc tive Se rvic e s a s we ll a s spe c ia lise d dia g nostic s a nd da y hospita l se rvic e s

– Assists ~4,000 c o uple s e a c h ye a r to a c hie ve the ir dre a m o f ha ving a b a b y – Ric h histo ry o f sc ie ntific a nd c linic a l e xc e lle nc e

  • Assiste d Re produc tive Se rvic e s is a g rowing a re a of he a lthc a re

– Multiple de mo g ra phic a nd so c ia l tre nds driving inc re a sing use o f Assiste d Re pro duc tive Se rvic e s – I VF Cyc le s in Austra lia g re w a t a c o mpo und a nnua l g ro wth ra te o f 4.4% b e twe e n 2007 a nd L T M to June 2013(1)

  • Virtus is the la rg e st provide r of Assiste d Re produc tive Se rvic e s in Austra lia

– 36% sha re o f I VF Cyc le s pe rfo rme d in Austra lia (2) a nd o pe ra te s in Austra lia ’ s la rg e st sta te s fo r I VF Cyc le s – One o f two le a ding pro vide rs in e a c h sta te in whic h it o pe ra te s – I nc re a se d c o lle c tive ma rke t sha re a c ro ss NSW, Vic a nd Qld fro m 43.9% in F Y2012 to 45.0% in F Y2013

  • Strong fina nc ia l tra c k re c ord with ma rke t c a pita lisa tion of ~$650M

– T ra c k re c o rd o f re ve nue a nd E BI T DA g ro wth with stro ng c a sh flo w g e ne ra tio n – Numb e r o f c urre nt a nd future g ro wth o ppo rtunitie s

Note s: (1) Ba se d o n Me d ic a re Be ne fit Sc he d ule I

te m Sta tistic Re p o rts fo r ite ms 13200, 13201 a nd 13202 (2) F

  • r F

Y2013 fina nc ia l ye a r, b a se d o n Me d ic a re Be ne fit Sc he d ule I te m Sta tistic Re p o rts fo r ite ms 13200, 13201 a nd 13202

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Ope rational Highlights in F Y2013

Continue d to e xpand our ge ogr aphic footpr int and se r vic e s to patie nts – thre e ne w full

se rvic e c linic s; five ne w c o ntra c te d F e rtility Spe c ia lists

Mar ke t shar e impr

  • ve me nt – c o ntinue d to impro ve o ur sa le s a nd ma rke ting a c tivitie s

Suc c e ssfully r

  • lle d out a low c ost mode l of c ar

e (“T he F e r tility Ce ntr e ”) – thre e ne w c e ntre s

  • pe ne d in Ne w So uth Wa le s a nd Vic to ria , a nd e xpa nde d o ur Que e nsla nd c e ntre to me e t

g ro wing de ma nd

E xpande d diagnostic c apabilitie s – a dde d ne w te sts inc luding Vit D, na tura l kille r c e ll te sting

a nd no n inva sive pre na ta l te sting

Continue d foc us on impr

  • ving the ope r

ations of our day hospitals – the a tre utilisa tio n,

  • pe ra tio na l e ffic ie nc ie s a nd a ttra c ting ne w spe c ia lists

Suc c e ssfully liste d on the ASX – a sig nific a nt mile sto ne fo r Virtus He a lth

1 2 3 4 5 6

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F Y2013 F inanc ial Highlights

Re ve nue +9.1% E BIT DA +8.7% NPAT A(2) +10.2% E PS (c ps)(3) +10.3%

Pr

  • for

ma F Y2013 financ ial r e sults(1)

Note s: 1.

T he a p p e nd ix inc lud e s re c o nc ilia tio n o f p ro fo rma fina nc ia l re sults to sta tuto ry fina nc ia l re sults

2.

NPAT A e xc lud e s the a mo rtisa tio n o f a c q uire d b ra nd na me s o f $0.7 millio n a fte r ta x

3.

E PS a ssume s 79,536,601 sha re s o n issue fo r full ye a r

  • Vs. F

Y2012 Pr

  • for

ma

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F Y2013 Prospe c tus F

  • re c asts De live re d

Pr

  • spe c tus

Ac tua l Va r ia nc e Re ve nue

184.5 187.3 +1.5%

E BIT DA

55.3 56.1 +1.4%

NPAT A(2)

27.3 28.0 +2.6%

E PS (c ps)(3)

33.4 34.3 +2.7%

Pr

  • for

ma F Y2013 financ ial r e sults(1)

Note s: 1.

T he a p p e nd ix inc lud e s re c o nc ilia tio n o f p ro fo rma fina nc ia l re sults to sta tuto ry fina nc ia l re sults

2.

NPAT A e xc lud e s the a mo rtisa tio n o f a c q uire d b ra nd na me s o f $0.7 millio n a fte r ta x

3.

E PS a ssume s 79,536,601 sha re s in issue fo r full ye a r

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  • 2. F

Y2013 Re sult De tail

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Vir tus IVF Cyc le s

IVF Cyc le Pe rformanc e

IVF Cyc le s inc r e a se d 3.8% to 14,342 in F Y2013

  • Virtus ta king ma rke t sha re
  • Ra mp-up o f T

he F e rtility Ce ntre pro g re ssing we ll

  • IVF

Cyc le s a t F ull Se rvic e c linic s c o ntinue to g ro w – stro ng g ro wth a mo ng ne w c o ntra c te d F e rtility Spe c ia lists(2)

  • Vir

tus IVF Cyc le s inc r e a se d 3.8% 1

Note : (1) Re p re se nts Virtus’ imp lie d sha re o f the I

VF Cyc le s c o nd uc te d in Ne w So uth Wa le s, Vic to ria a nd Que e nsla nd b a se d o n Me d ic a re Be ne fit Sc he d ule I te m Sta tistic Re p o rts fo r ite ms 13200, 13201 a nd 13202. (2) Ne w c o ntra c te d F e rtility Sp e c ia lists a re d e fine d a s tho se F e rtility Sp e c ia lists c o ntra c te d b y Virtus fro m F Y2010 o nwa rd s

Numb e r o f IVF Cyc le s

(1)

  • Que e nsla nd – ve ry stro ng first ha lf whic h ha s mo de ra te d in 2H

F Y2013

  • Ne w So uth Wa le s – 10% g ro wth in 4Q F

Y2013 fo llo wing we a ke r 1H F Y2013

  • Vic to ria – ma rke t fla t b ut se e ing c o ntinue d g ro wth in ne w pa tie nt

re g istra tio ns

  • Ove r

a ll E a st Coa st ma r ke t mixe d – Vir tus be ne fiting fr

  • m sc a le a c r
  • ss

ma r ke ts 2

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Re ve nue

Re ve nue Growth

Pr

  • for

ma r e ve nue inc r e a se d 9.1% to $187.3 million in F Y2013

  • IVF

Cyc le g ro wth o f 3.8%

  • Ave ra g e re ve nue pe r IVF

Cyc le inc re a se d b y 5.2%

  • Re ve nue g r
  • wth unde r

pinne d by IVF Cyc le g r

  • wth a nd a n inc r

e a se in tota l r e ve nue pe r IVF Cyc le 1

  • Co nsiste nt with histo ric tre nds, Virtus sa w hig he r usa g e o f

spe c ia lise d dia g no stic te sting b y F e rtility Spe c ia lists to pa tie nts

  • Spe c ia lise d dia g nostic s r

e ve nue c ontinue d to g r

  • w

2

  • Gro wth prima rily drive n b y hig he r thro ug hput fro m Assiste d

Re pro duc tive Se rvic e s a nd o the r me dic a l spe c ia ltie s

  • Da y hospita l r

e ve nue c ontinue d to g r

  • w

3 140.8 144.0 171.6 187.3 FY2010 FY2011 FY2012 FY2013 $ millio n Total Revenue per IVF Cycle $10,741 $11,453 $12,420 $13,060

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E BIT DA

T

  • tal E

xpe nse s and E BIT DA Growth

Pr

  • for

ma E BIT DA inc r e a se d 8.7% to $56.1 million in F Y2013

  • T
  • ta l e xpe nse s inc r

e a se d 9.3% to $131.2 million in F Y2013 1

  • Inc re a se re fle c ts o pe ning o f ne w c linic s in F

Y2013, a nd full ye a r c o st o f F Y2012 ne w c linic o pe ning s

  • L

a bour c osts inc r e a se d 11.8% to $55.8 million in F Y2013 2

  • F

e e inc re a se s in line with pric ing a nd vo lume

  • Pr
  • vide r

fe e s inc r e a se d 7.3% to $29.4 million in F Y2013 3

  • Ma rke ting e xpe nse s inc re a se d b y 12.8% to suppo rt

ne w T F Cs a nd full se rvic e c linic s

  • Othe r
  • pe r

a ting e xpe nse s inc r e a se d 2.1% to $14.4 million in F Y2013 4 39.6 41.9 51.6 56.1 FY2010 FY2011 FY2012 FY2013 $ millio n

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  • 3. Str

ate gy and Outlook

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Strate gic F

  • c us for Virtus

Str a te g ic foc us for Vir tus in F Y2014

  • E

xpa nsio n o f fe rtility c linic ne two rk a nd c a pa c ity a mo ng ne wly c o ntra c te d F e rtility Spe c ia lists po sitio ns Virtus to ma inta in a nd e xpa nd ma rke t sha re in the re g io ns in whic h it o pe ra te s

  • Re c e ntly c o mple te d $4.25M re lo c a tio n a nd e xpa nsio n o f ma in Que e nsla nd F

e rtility Gro up Brisb a ne CBD c linic Market share

  • F
  • c us o n inc re a sing a c tivity in e xisting c e ntre s in F

Y2014

  • Co mme nc e d e xpa nsio n o f T

F C Spring wo o d in Que e nsla nd to me e t inc re a se d pa tie nt de ma nd fo r this se rvic e

  • Re vie w o ppo rtunitie s fo r a dditio na l T

F C c linic s Low-cost IVF

  • E

xe c uting a numb e r o f stra te g ie s to g ro w spe c ia lise d dia g no stic s se rvic e s re ve nue

  • Adding ne w te sts to Virtus’ dia g no stic s pla tfo rms inc luding tho se de ve lo pe d thro ug h inte rna l inno va tio n (e .g . na tura l kille r

c e ll te sting )

  • E

xpa nd ra ng e o f g e ne tic te sts a nd c o ntinue ro ll-o ut o f ne wly de ve lo pe d No n-Inva sive Pre na ta l T e sting c a pa b ilitie s Specialised Diagnostics

  • F
  • c us o n inc re a sing thro ug hput a nd impro ving o pe ra tio na l e ffic ie nc y
  • E

xpe c t to se e the b e ne fits o f re c e nt inve stme nts in mo de rnisa tio n a nd e xpa nsio n pro g ra ms

  • E

xplo re a c q uisitio n o ppo rtunitie s Day Hospitals

  • Disc ipline d a ppro a c h to c o nside ring po te ntia l a c q uisitio n a nd inve stme nt o ppo rtunitie s b o th in Austra lia a nd

inte rna tio na lly Potential Acquisitions and Investments

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Busine ss Outlook

13

  • 1QF

Y2014 mar

ke t volume a c ro ss the Gro up has inc r e ase d ~3% ye ar

  • on- ye ar
  • T

F C gr

  • wth is ahe ad of e xpe c tations
  • Diagnostic r

e ve nue gr

  • wing a t do ub le dig it pa c e
  • F

Y14 for e c ast in Pro spe c tus – r e c onfir me d

1 2 3 4

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SLIDE 14

T hank You

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