Metropolis Healthcare Ltd. · NSE:METROPOLIS
Metropolis Healthcare — Q3 FY2022 Earnings Presentation
68 slides from Metropolis Healthcare's earnings presentation, Feb 11, 2022
Slide 1: Intimation of Investor Presentation
Ref: MHL/Sec&Legal/2021-22/73 Date: February 11, 2022 To, Head, Listing Compliance Department Head, Listing Compliance Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Exchange Plaza, Plot No. C/1. G Block, Dalal Street, Mumbai - 400 001. Bandra -Kurla Comple
Slide 2: Reaching Out Responsibly - Investor Presentation February 2022
Reaching Out RESPONSIBLY Investor Presentation - February 2022
Slide 3: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Metropolis Healthcare Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any
Slide 4: Q3FY22 Performance
Q3FY22 Performance...
Slide 5: Q3FY2022 - Performance Snapshot
Q3FY2022 - Performance Snapshot Revenue Non-Covid Revenue Rs. 293 Crores Rs. 244 Crores +7% YoY +9% YoY EBITDA Margin (Before CSR, ESOP & one Core Business Growth* time acquisition cost) +31% YoY 27.5% No. of Tests Patient Visits Q3FY22 Key Highlights 6.3 Mn 3.3 Mn +24% YoY +22% YoY Including Hitech
Slide 6: Quarterly trend snapshot
Quarterly trend snapshot Non-Covid Revenue +9% 251.0 264.2 259.8 Key Highlights 223.6 243.7 ✓ Non-covid business could have grown faster, however the company witnessed sharp drop Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 in volumes from a government contract. Covid Revenue Contribution Company expects the
Slide 7: Q3FY22 Consolidated Financial Performance
Q3FY22 Consolidated Financial Performance Reported EBIDTA Revenue (In Rs. Crs.) (In Rs. Crs.) Margins 31.5% 26.0% 274.7 293.1 86.7 76.2 Q3FY21 Q3FY22 Q3FY21 Q3FY22 EBIDTA (In Rs. Crs.) Reported PAT Before CSR, ESOP & one time acquisition cost (In Rs. Crs.) Margins 32.8% 27.5% Margins 21.3% 14.1% 90.
Slide 8: Q3FY22 EBITDA Bridge (Before CSR & ESOP)
Q3FY22 EBITDA Bridge (Before CSR & ESOP) EBITDA Bridge (Before CSR & ESOP) (in Rs. Crs.) 32.8% -2.9% -0.5% 27.5% -1.0% -0.9% Q3FY21 EBITDA Investment in Investment in Drop in Covid Investment in Q3FY22 EBITDA Digital Initiatives Lab Expansion Margin due to Manpower at price corporate rationalisation
Slide 9: Operational metrics
Operational metrics No. of Patient Visits (In Mn.) Revenue Per Patient (In Rs.) Total Business Non-Covid Business ✓ Revenue per patient & test has +22% fallen primarily on account of -13% -5% consolidation with Hitech which 3.3 1,029 2.7 898 959 911 has a lower revenue per patient & revenue per test
Slide 10: Strong traction in B2C business (Non-Covid)
Strong traction in B2C business (Non-Covid) Annual Trend Quarterly Trend B2C Business Revenue (Non-Covid) B2C Business Revenue (Non-Covid) +50%* +12% -11% +18% +25% FY18 FY19 FY20 FY21 9MFY22 Q3FY21 Q3FY22 In 9MFY22 - Company has already surpassed the B2C revenue (non-covid) recorded in FY21 Above n
Slide 11: Share of B2C Business in Focus Cities (Non-Covid) at 59% in 9MFY22
Share of B2C Business in Focus Cities (Non-Covid) at 59% in 9MFY22 ✓ Excluding Covid-19 revenues, our B2C contribution B2C Contribution in Focus Cities (Non-Covid Business) (Rs. in Crs.) continues to increase ✓ Our aspirations is to achieve 65% B2C contribution in focused cities in coming years rema
Slide 12: Well diversified test volume and value mix
Well diversified test volume and value mix… Q3FY21 Q3FY22 Q3FY21 Q3FY22 Volume Mix (Total Business) Value Mix (Total Business) 1% 1% 6% 13% 8% In overall mix, value of 15% 22% 22% specialized mix has reduced 42% 42% due to steep decline in 27% covid test prices YoY 47% 30% 54% 35% 34% Routine Semi-S
Slide 13: Diversified Revenue contribution across Geographies
Diversified Revenue contribution across Geographies… Q3FY21 Q3FY22 Q3FY21 Q3FY22 Revenue Mix between Focus, Seeding & Others Cities (Total Business) Revenue Mix between Geographies (Total Business) 13% 7% 7% 18% 19% 4% 25% 25% 58% 25% 18% 64% 54% 56% 5% 5% Focus Seeding Others North South East West
Slide 14: Network Strategy
Network Strategy Laboratory Network - MHL Service Network - MHL Hitech Network Total Network ARC Rationalization Third Party PSCs Period Lab network Service network +470 centers Total 165 Total 3095 + 10 labs Owned PSCs 3,025 Labs 2,731 2,555 30 Labs 30 70 135 2,336 680 119 124 125 598 498 106 1,650
Slide 15: Home visits services now covered in more than 100 locations
Home visits services now covered in more than 100 locations… Home Visits Revenue (Total Business) Home Visits Revenue (Non-Covid Business) Rs. Crs. Rs. Crs. 136 104 80 74 40 32 25 24 Q3FY21 Q3FY22 FY21 9MFY22 Q3FY21 Q3FY22 FY21 9MFY22 Non-Covid Home Visits Revenue as a % of Non-Covid B2C business To
Slide 16: Digital engagement driving huge growth in brand equity
Digital engagement driving huge growth in brand equity 9MFY22 Business Impact 276% increase in Faster Growth in digital users YoY Home Visit revenue 397% increase in ~Rs.76 Crs. Revenue in website views YoY 9MFY22 through leads Digital strategy is playing generated via Digital important role in cons
Slide 17: Creating a Digital Ecosystem for all stakeholders
Creating a Digital Ecosystem for all stakeholders Participate in Health Ecosystem ✓ Increase our participations in the growth as health-tech ecosystem expands & in active conversation with all leading platforms and aggregators for connectivity ✓ Launched E-commerce capabilities on web platform For o
Slide 18: Building towards a seamless Omni Channel Experience: Click <> Brick
Building towards a seamless Omni Channel Experience: Click <> Brick Experience Online Retail Customer Customer Click Brick Service Multi channel interaction capabilities across Digitizing operational process to improve Capabilities website, app, WhatsApp and chat efficiency and TAT Capabilities Prov
Slide 19: Enhancing patient experience with an automated multi-modal experience
Enhancing patient experience with an automated multi-modal experience Web Mobile App WhatsApp Chat Increased focus on driving enhanced patient experience via technology channels with a target to improve service levels and reduce service costs for Metropolis Experience Automation Experience Enhanceme
Slide 20: Steady Focus on Balance Sheet continues
Steady Focus on Balance Sheet continues Debtor Days*# Working Capital Days* ✓ We have continued to focus on collection 41 efficiency and improved our Debtor days 31 13 ✓ Working capital days has increased primarily on early payment to creditors. 4 ✓ Debt taken for the Hitech acquisition was Rs. 300
Slide 21: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Profit & Loss Statement (Rs. Crs.) Q3FY22 Q3FY21 Y-o-Y 9MFY22 9MFY21 Y-o-Y Revenue from Operations - Metropolis 273.4 274.7 902.7 706.3 Revenue from Operations - Hitech 19.6 - 19.6 - Total Revenue from Operations 293.1 274.7 7% 922.4 706.3 31% Cost of Raw Materia
Slide 22: Consolidated Balance Sheet
Consolidated Balance Sheet Assets (Rs. Crs.) Sep-21 Mar-21 Equity & Liabilities (Rs. Crs.) Sep-21 Mar-21 Non-current assets 400.0 396.0 Equity 846.5 708.1 Property, Plant and Equipment 117.6 115.1 Equity Share capital 10.2 10.2 ROU Assets 104.5 103.1 Other equity 834.6 696.4 Goodwill 90.3 90.3 Non C
Slide 23: Completed acquisition of Hitech Diagnostics
Completed acquisition of Hitech Diagnostics
Slide 24: Completed acquisition of Hitech Diagnostics
Completed acquisition of Hitech Diagnostics About Hitech Diagnostics Established in 1986, Hitech Diagnostic Centre is a well-known Diagnostics laboratory chain in the South India market with a network of 30 laboratories including 3 NABL and ICMR accredited laboratories and 70 collection centres stra
Slide 25: Contours of the Deal
Contours of the Deal Metropolis acquires Hitech Diagnostics Centre Metropolis has acquired 100% equity of Dr. Ganesan’s Hitech Diagnostic Centre Pvt. Ltd. & its 01 subsidiary Centralab Healthcare Services Private Limited in all cash deal for Rs. 636 Crores. Acquisition has been funded through intern
Slide 26: Hitech – Strategic Initiatives
Hitech – Strategic Initiatives Hitech Diagnostic Centre Revenue strategy to aid double digit growth Revenue Rs. (In Crs.) ✓ Dual brand strategy in Chennai while single brand in rest of Covid Non-Covid TN & Karnataka. Plan to launch 100 centers in FY23 124 ✓ Increasing contribution of speciality test
Slide 27: Strategic Rationale of the Acquisition
Strategic Rationale of the Acquisition Acquisition of Hitech Diagnostics will lead Metropolis to… Strengthen the Leadership Position With the acquisition of Hitech Diagnostics, Metropolis will strengthen its position as 2nd largest Diagnostics company in India and largest brand in South and West Ind
Slide 28: FY22 and beyond
FY22 and beyond...
Slide 29: Way Forward for FY22 and beyond
Way Forward for FY22 and beyond… Add 90 labs and 1,800 service centers over next 3 years and strengthen our leadership Network Expansion position in existing geographies and build Metropolis brand in new geographies Expand Home Visit coverage to 100 locations in 1 year and cover 200 locations within
Slide 30: 1. Network Expansion Plan – 90:30 Project
1. Network Expansion Plan – 90:30 Project* Metropolis Network Expansion Plan Laboratory Network Service Network +72% +70% 215 4,355 90 1,800 125 2,555 FY21 Addition FY24E FY21 Addition FY24E over 3 years over 3 years ✓ Expand to existing & newer locations – Aim to expand the service network to exist
Slide 31: 2. Driving growth via digitally driven, asset-light home-visit segment
2. Driving growth via digitally driven, asset-light home-visit segment Asset Light Digital demand Rapid scale up via technology drive generation processes + 3rd party network Capturing Changing Demand 1 Integrated CRM to Covid has brought a strong shift in Captured via “At-home” consumption of provi
Slide 32: 3. Deepening our digital touch points, capability throughout our value chain
3. Deepening our digital touch points, capability throughout our value chain Digitally engaging Scaling up Digitizing distribution & logistics: Digital Customer Engagement: customers and operational Launched Unified Patient Launching an end-to-end online partners capabilities Information System lead
Slide 33: 4. Levers for Margin Improvement
4. Levers for Margin Improvement Increased Utilization and Product Mix Higher utilization of Labs and increase in patient visits coupled with superior product mix 01 Increased Home Visits Cost Efficiency Initiatives Increase Home Visits revenue with focused Encouraging innovation and critical thinki
Slide 34: Overview
Overview
Slide 35: We are Metropolis: The Pathology Specialist
We are Metropolis: The Pathology Specialist To be a respected healthcare brand trusted by clinicians, patients and stakeholders. Positively impact lives of patients Vision in their most anxious times and turn their anxiety in to assurance. Helping people stay healthy, by accurately revealing their 3
Slide 36: Journey to Leadership Position
Journey to Leadership Position ✓ First Referral Laboratory Set- ✓ Ameera Shah takes charge ✓ Secondary transaction by ✓ Exit of Warburg Pincus, ✓ Strong Thrust on Retail up by Founder & Chairman Dr. Foxcreek Investment Limited management control by frontend Expansion ✓ First major acquisition - Sush
Slide 37: Three decades of Delivering Value to Stakeholders
Three decades of Delivering Value to Stakeholders Leadership Position Across Industry METROPOLIS Focus Area ACCREDITATION CUSTOMER & QUALITY EXPERIENCE ROCE SPECIALITY SCORES SCORE BUSINESS INCREASED INFRASTRUCTURE PRODUCTIVITY REVENUE PER REALISATION PER TEST MENU OF YOUNG PATIENT PATIENT NETWORK 3
Slide 38: Key Drivers for Growth
Key Drivers for Growth 01 Industry Growth 05 Expansion Plan 02 Value Chain 06 Quality 03 Business Model 07 People 04 Service Network 08 Digital Transformation 37
Slide 39: 1a. Diagnostic Industry Poised to grow
1a. Diagnostic Industry Poised to grow… Indian Healthcare Industry Size of Indian Diagnostics Market Indian Diagnostics Industry Breakup Source – IIFL Diagnostics Report (in Billion Rs.) 6.0% +11.6% 924 9.0% 4.0% Healthcare Delivery - Hospitals 776 42% Pharma Pathology +16.4% 596 13.0% Medical Devic
Slide 40: 1b. Top players to continue to acquire market share of standalone centers
1b. Top players to continue to acquire market share of standalone centers Brand Awareness Increased brand awareness amongst patients and customers towards quality, reliability and test accuracy Service + Scale Large Test menu Large Test menu by organized diagnostics chains Factors leading Consolidat
Slide 41: 2. Presence in key pockets of Value Chain
2.Presence in key pockets of Value Chain Diagnostic Industry - Fragmented Routine Test Metropolis Focus Highly Fragmented Market Low Quality Standard Majority Diagnostic Players Technician + Run Lab Low on Technical Qualifications & Moderate Competition Presence across Accreditations (99.9% labs rem
Slide 42: 3. Hub & Spoke Model to scale efficiently
3. Hub & Spoke Model to scale efficiently Home Collection Global Reference Lab (GRL) Individual Patient (B2C) Wholesale (B2B) RRL / Satellite Lab Express Lab Third Party Lab / Hospitals / ARCs Collection Patient Centres Patient Leverage Widespread Delivery to our Enhances Collection of Greater netwo
Slide 43: 4. Patient Centric Network
4.Patient Centric Network Global and More than ~4,000 Present in 19 States 35+ Years National Over 10,000 Patient Test’s & Profiles & 210 cities Quality Touch Points of Credible Operations Accreditations Why Metropolis ? Collection ✓ Conclusive Diagnosis with Large Centres Pics test Menu backed by H
Slide 44: 5. Asset Lite Expansion Plan
5. Asset Lite Expansion Plan Asset Light Model Network Expansion Strategy Doctor APSC/ Lab on ✓ Focus on Asset Light Model to achieve Geographic Expansion with Bleeding DAPSC Lease High Scalability Point (DBP) ✓ The A-PSC and D-APSC Model allows us to grow our revenues by providing management and br
Slide 45: 6a. Quality in Core
6a. Quality in Core Quality Scores of 98.5% in 2018-19 by College Quality protocols following global standards of American Pathology 99.9% of industry labs remain un-accredited with lack of minimum standards in the industry Large Investments in Focus on Governance Information and rigorous audit Tech
Slide 46: 6b. Globally Compliant Quality Standards
6b. Globally Compliant Quality Standards “Global Lab Accreditations” No. of Audits Conducted by PAC Team FY 17-18 18-19 19-20 20-21 665 1,312 1057 583 ✓ PAC Team: Special Pre Analytical Care Team constituted as part of the Quality Assurance Team ✓ This team conducts thorough internal audits as per N
Slide 47: 7. People are our greatest asset
7. People are our greatest asset Leadership Team Investment in future leaders aligned to vision of the company. across levels and ahead of time. 2. Decision making Business models at par with changes 1. Leadership and Strengthening Structures to in the fields of Technology & structure support object
Slide 48: 8. Leveraging IT for Competitive Advantage
8. Leveraging IT for Competitive Advantage 1 2 3 4 Improving Business revenue Improved Operational Improve Customer Cost Saving & Optimization generation capabilities Efficiency Experience ✓ Zero Data Loss; 100% data ✓ IBM Watson Campaign Automation replication in remote location ✓ Mobility Applicat
Slide 49: 8a. Digital Transformation to improve efficiency
8a. Digital Transformation to improve efficiency 1 Standardization Achieve standardization across 2 Reduced Errors Reduce incidence of errors due to human intervention our operations Patients & Customers 3 Technical Operations Provide convenience to our 5 Monitor Technical Operations patients and cu
Slide 50: Future Strategy
Future Strategy 01 Increase Services 02 Increase Scale 49
Slide 51: Customer Centricity: In everything we do
Customer Centricity: In everything we do 01 02 03 04 Easy to Interpret Test Sample Collection from Conclusive Diagnosis Digital Access Report Doorstep We also have a policy of ensuring We have developed a Mobile Conclusive Diagnosis to our Application We offer our patients a Detailed We have increas
Slide 52: Sustainable Growth across Network
Sustainable Growth across Network Network of 210 Cities Criteria Strategy % of Revenue for FY21 (Total Business) ✓ Increasing productivity of Collection Centers ✓ Enhancing our Laboratory Capacity and Test Menu by adding Latest Machines and Technology ✓ High Potential Market Focus Cities ✓ Expanding
Slide 53: Increase B2C sales mix
Focus on Profitable B2C Business Increase B2C sales mix Deeper Network Strengthen Productivity of Wellness initiatives Penetration Metropolis Brand existing young network for consumers Deeper centre penetration Expand Branded third- Increase number of referring Creating an easy and engaging in Focus
Slide 54: Growing Inorganically – A Win-Win Strategy
Growing Inorganically– A Win-Win Strategy Build Industry Best practices Introducing Standardized Machines and SOPs in a phased manner resulting in efficiency and quality enhancement Access to Metropolis Network Providing acquired entities access to Metropolis Sales and Marketing Network to improve t
Slide 55: Successful Track Record of Inorganic Strategy: 23 Acquisitions in 16 years
Successful Track Record of Inorganic Strategy : 23 Acquisitions in 16 years Revenue at the time of Few of the Acquired Companies Year of Acquisition Location Revenue for FY21 acquisition Sudharma Metropolis Health Services 2003 Kerala Rs. 1.8 Crores Rs. 44.9 Crores Private Limited Golwilkar Metropol
Slide 56: Plenty of Opportunities for Growth
Plenty of Opportunities for Growth… Growing our offering of Test Packages to Increase Revenue Test Packages Metrics. Customized packages to Institutional Customers Expansion and Personalized Packages to Individual Patients are key Leverage our vast capabilities in Molecular Diagnostics, Aggressive N
Slide 57: CSR Activities
CSR Activities Nutrition Box Project ✓ Nutrition boxes delivered to doctors and healthcare workers posted in COVID Care Centers, Municipal Corporations and COVID Hospitals by Metropolis with the help of WE Foundation Covid Testing Projects ✓ Project Ummeed – In association with Citibank & CIPLA Foun
Slide 58: Historical Financial & Operational Performance
Historical Financial & Operational Performance
Slide 59: Better than industry growth
Better than industry growth Revenue (In Rs. Crs.) Bolstering Growth in Wellness Segment Metropolis Wellness revenue contribution for +16% 998 Metropolis is 6% in FY21 856 760 644 545 This market is expected to grow at a CAGR of 20% over next 3 financial years (Frost & Sullivan) FY17 FY18 FY19 FY20 F
Slide 60: Well growing B2C Mix
Well growing B2C Mix Retail contribution in Focus Cities (Non-Covid) to Total Revenue 56% 58% 52% 48% 45% Primary Strategy of the Company is to increase the Retail share in focus cities to 65% FY17 FY18 FY19 FY20 FY21 Chart shows B2C contribution over the years in focus cities; Mumbai, Chennai, Bang
Slide 61: Financial Highlights
Financial Highlights Revenue (In Rs. Crs.) Reported EBITDA (In Rs. Crs.) ROCE (%) +16.3% 998 288 +16.8% 46.5% 856 42.8% 760 232 40.0% 40.9% 206 38.3% 644 173 545 155 FY17 FY18 FY19 FY20 FY21 FY17 FY18 FY19 FY20 FY21 FY17 FY18 FY19 FY20 FY21 EBITDA (%) Reported PAT (In Rs. Crs.) ROE (%) 28.4% 28.9% 1
Slide 62: Profit & Loss Statement
Profit & Loss Statement Profit & Loss (Rs. Crs.) FY21 FY20 FY19 FY18 FY17 Revenue from Operations 997.8 855.5 760.1 643.6 544.7 Cost of Material Consumed 252.2 204.1 173.5 145.9 135.1 Laboratory testing charges 5.4 6.9 5.6 5.7 2.5 Gross Profit 740.1 644.5 581.0 492.0 407.1 Gross Profit (%) 74.18% 75
Slide 63: Balance Sheet
Balance Sheet Assets (Rs. Crs.) Mar-21 Mar-20 Mar-19 Mar-18 Mar-17 Equity & Liabilities (Rs. Crs.) Mar-21 Mar-20 Mar-19 Mar-18 Mar-17 Non-current assets 396.0 355.2 247.9 230.1 230.1 708.1 Equity 525.2 420.0 429.1 344.1 Property, Plant and Equipment 115.1 121.2 116.7 112.3 105.2 Equity Share capital
Slide 64: Board of Directors and Management Team
Board of Directors and Management Team
Slide 65: Board of Directors
Board of Directors Dr. Sushil Kanubhai Shah Ameera Sushil Shah Chairman & Executive Director Managing Director Holds a bachelor’s degree in Medicine and Surgery and Holds a bachelor’s degree in Business Administration a degree of Doctor of Medicine in Pathology and from the University of Texas and a
Slide 66: Management Team
Management Team Vijender Singh Dr. Nilesh Shah Chief Executive Officer President and Chief of Science & Innovation Holds a bachelor’s degree in Science from Kurukshetra Holds a master’s degree in Engineering from University of University and completed an Executive Education Mumbai and a Diploma in M
Slide 67: Recent Awards and Accolades
Recent Awards and Accolades Period Particulars Our MD, Ms. Ameera Shah has won the Women Entrepreneur Award in Organizational Segment - January 2021 Health & Wellness category at the Express Awards for Women Entrepreneurs (ExpressAWE), instituted by the Financial Express and FICCI FLO Our MD, Ms. Am
Slide 68: For further information, please contact
For further information, please contact: Company : Investor Relations Advisors : Metropolis Healthcare Ltd. Strategic Growth Advisors Pvt. Ltd. CIN – L73100MH2000PLC192798 CIN - U74140MH2010PTC204285 Mr. Rakesh Agarwal - CFO Mr. Shogun Jain / Mr. Shrenik Shah Email Id – rakesh.agarwal@metropolisindi
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