Medical Facilities Corporation · TSX:DR
Medical Facilities — Investor Presentation (August 2017)
20 slides from Medical Facilities's investor presentation, August 2017
Slide 1: Optimized. Enhanced. Investor Presentation August 2017
Optimized. Enhanced. INVESTOR PRESENTATION AUGUST 2017 TSX: DR
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements within the meaning of certain securities laws, including the “safe harbour” provisions of the Securities Act (Ontario) and other provincial securities law in Canada. These forward-looking statements include, among ot
Slide 3: Transforming U.S. Healthcare Landscape
Transforming U.S. Healthcare Landscape Other Specialty Clinic Acute Care Hospital Home Healthcare (~5,500*) Ambulatory Imaging Surgery Center Clinic (~5,500*) MFC TODAY Specialty Surgical Urgent/Primary Hospital (<300 physician- Care Center owned*) 3 * Estimated total U.S.
Slide 4: Multiple Payment Sources
Multiple Payment Sources Medicare 20% Private Health Insurance 33% 2015: $3.2 41% Public Health TRILLION Insurance Medicaid 18% Out of Pocket 11% Other Government 3% Public Health and Other Third Parties Investment 8% 7% 4 Source: Kaiser Family Foundation
Slide 5: Growing Demand for Healthcare
Growing Demand for Healthcare (millions) (US$ billion) 400 5,000 DRIVERS: National Health Expenditure 4,000 300 Overall population growth Population 3,000 Aging population 200 2,000 Healthcare reform 100 expanding coverage 1,000 0 0 2010 2015E 2020E Under 45 years 45 to 64 years 65 years and o
Slide 6: Changing Healthcare Industry Driving Acquisition Opportunities
Changing Healthcare Industry Driving Acquisition Opportunities Greater need for efficiency and scale among healthcare providers Independent centers requiring scale to drive margin improvement Portfolio rebalancing as a result of consolidation or service realignment makes attractive assets avai
Slide 7: MFC: A Quality Healthcare Provider Well-Positioned for Growth
MFC: A Quality Healthcare Provider Well-Positioned for Growth Majority ownership in five specialty surgical hospitals and one ambulatory surgery center • Specialty Surgical Hospitals: 48 operating rooms and 156 overnight rooms • Ambulatory Surgery Center: 2 operating rooms 2016 Revenue: US$339.5
Slide 8: MFC Specialty Surgical Hospitals
MFC Specialty Surgical Hospitals Our physician owned hospitals benefit from direct physician involvement in facility management resulting in 2 SUPERIOR PROCESSES AND EFFICIENCIES 1 1 Specialty surgical hospitals have consistently demonstrated 1 1 HIGHER PATIENT SATISFACTION ratings resulting from HI
Slide 9: Well-Situated in Current Markets
Well-Situated in Current Markets Situated in geographic regions that have proven to be resilient against challenging economic environments MFC physicians and staff are integral part of our success, they provide patients with innovative treatments and optimal service Unemployment Rate (%)1 U.S. Arkan
Slide 10: Strict Acquisition Criteria
Strict Acquisition Criteria Accretion, with growth available from a local strong provider base, attractive demographics, and opportunities for operating enhancements High quality and optimum clinical outcomes Continued strong earnings and opportunity for growth Controlling position by MFC 10
Slide 11: Financial Review
Financial Review 11
Slide 12: Factors Driving Our Results
Factors Driving Our Results Revenues Operating Margins Case Counts Level Salaries & Benefits Case Mix of Revenue Drugs & Supplies (incl. implants) Payor Mix General & Administrative Ancillary Services 12
Slide 13: MFC Payor Mix – 2016
MFC Payor Mix – 2016 Blue Cross/ Medicare/ Workers’ Other Private Other Blue Shield Medicaid Compensation Insurance 7% 8% 14% 34% 20% 35% 7% 8% 38% 29% GROSS BILLINGS NET REVENUE 13
Slide 14: Operating Results – Q2 2017
Operating Results – Q2 20171 Q2 2017 Q2 2016 Change % (US$ millions, except where noted otherwise) REVENUE 96.1 76.7 25.2% INCOME FROM OPERATIONS 16.2 13.8 17.6% OPERATING MARGIN 16.9% 17.9% (5.6%) EARNINGS BEFORE INTEREST, TAXES, $23.1 $18.9 22.2% DEPRECIATION AND AMORTIZATION (EBITDA) CASH DISTRIB
Slide 15: Well-Resourced for Growth
Well-Resourced for Growth Cash and cash equivalents: $56.7 million Current ratio: 2.3x Net Debt/Equity: 44.7% Subsidiary Debt Coverage (LTM): 1.5x 15
Slide 16: Strong Cash Flow
Strong Cash Flow1 Distributions Cash Available for Distribution Cash Available for Distribution (including realized gains/losses on FX forward contracts)2 (Excluding realized gains/losses on FX forward contracts) (C$ millions) 51.9 50.7 50.7 45.9 43.3 69.0 % 40.8 40.8 41.4 37.8 35.7 34.4 35.3 35.2 3
Slide 17: Key Strengths
Key Strengths • Well-located facilities providing stable cash flows • Favorable industry growth drivers • Experienced, entrepreneurial management team • Resources in place to execute on growth strategy 17
Slide 18: Management
Management Jeffrey C. Lozon Tyler C. Murphy Interim Chief Executive Officer Chief Financial Officer Formerly: Revera Living, St. Michael’s Formerly: Tenet Healthcare, HealthSouth Hospital Robert O. Horrar James D. Rolfe Chief Operating Officer Chief Development Officer Formerly: Community Health Sys
Slide 19: Board of Directors
Board of Directors Marilynne Day-Linton, CPA, CA David R. Bellaire Chair of the Board of Directors Operating Partner, Waud Capital Partners Stephen Dineley, FCPA, FCA Irving R. Gerstein, C.M., O.Ont Corporate Director Corporate Director Dale Lawr, CPA, CA Jeffrey C. Lozon Corporate Director Corporat
Slide 20: Capital Markets Profile (as at August 11, 2017)
Capital Markets Profile* (as at August 11, 2017) Stock Symbol: TSX: DR Shares Outstanding: 31.0 million Price: $14.90 52‐Week Low / High: $11.14/$23.45 Market Capitalization: $461.9 million Annualized Distribution (per share): $1.125 Current Yield: 7.6% Payout Ratio (TTM):** 69.0% *All figures in Ca
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