Terveystalo Oy Class A · OMXHEX:TTALO
Terveystalo Oy Class A — Q1 2023 Earnings Presentation
23 slides from Terveystalo Oy Class A's earnings presentation, May 2023
Slide 1: Terveystalo Group Q1 2023 Results
Terveystalo Group Q1 2023 Results VILLE IHO, PRESIDENT & CEO JUUSO PAJUNEN, CFO
Slide 2: Welcome
Welcome AGENDA TODAY Ville Iho, President & CEO • Financial & operational highlights • Progress of the Alpha-Profit improvement program Juuso Pajunen, CFO • Financial performance analysis • Progress against financial targets • Outlook & guidance 2 FOOTER
Slide 3: Solid earnings driven by robust demand, profit improvement program on track
Solid earnings were driven by robust demand, profit improvement program on track Strong demand continues Margin uplift progressing according to plan Alpha on track, EUR 25 mill run-rate impact in Q1 3
Slide 4: Progress according to plan in Q1
Progress according to plan in Q1 Record-strong customer Q1 2023 Revenue (EUR) satisfaction* 341.1 Mill. NPS 85 +3.4% y-o-y +2.1%-p y-o-y Q1 2023 Adj. EBITA (EUR) Engaged employees* 36.5 Mill. eNPS 29 -6.4% y-o-y FY 2022 Q1 2023 EPS (EUR) Physical appointments** 0.09 1.2 Mill. -56% y-o-y +1.4% y-o-y
Slide 5: Margin uplift progressing as planned, actions underway in each segment
Margin uplift progressing as planned, actions are well underway to address the bottom line in each segment Set targets for each business segment Profit improvement program on track to deliver approx. EUR 30 Mill. P&L Healthcare Portfolio Sweden impact in 2023 50+ services businesses €250 13% €71m 4%
Slide 6: Focus on the total cost & outcomes of the treatment path
Clinical Quality Highlight Focus on the total cost & outcomes of Case Surgical Care the treatment path 4 1 Terveystalo can invest in continuous Integrated model improves holistic outcomes improvement of care • Clinical: Average Oxford hip score increase • Capture of real-time results and use of from
Slide 7: Optimized surgical care delivery maximizes employee workability and results
Clinical Quality Highlight Optimized surgical care delivery maximizes Case Surgical Care employee workability and results EUR 10,500 savings for the employer per episode Care protocol implemented -34% 91 90 93 89 75 61 2017 2018 2019 2020 2021 2022 Average number of post-surgery sick leave days afte
Slide 8: Financial performance
Financial performance Juuso pajunen, CFO 8 FOOTER
Slide 9: Solid earnings driven by robust demand, margin uplift underway
Solid earnings were driven by robust demand, margin uplift underway Revenue growth driven by strong demand Margins developing favourably across segments High confidence on execution, issuing guidance 9
Slide 10: Revenue growth driven by strong demand in brick-and-mortar appointments
Revenue growth driven by strong demand in brick-and-mortar appointments 13,1 341,1 22,0 1,9 3,3 0,3 6,6 2,1 0,8 329,7 0,7 Healthcare services Portfolio businesses • Outsourcings decline due to • Loss of COVID-revenues partly the ending of contracts off-set by other labs improving • Dental recovery a
Slide 11: Adjusted EBITA impacted by a decrease in COVID-19 testing
Adjusted EBITA impacted by a decrease in COVID-19 testing, cost inflation compensated by price increases 38,9 • In Healthcare services, EBITA was impacted by: 3,7 1,1 0,9 36,5 • Change in sales mix driven by volume increase in 1,1 physical appointments • Price increases compensated for the cost infl
Slide 12: Underlying performance strengthened in each segment
Underlying performance strengthened in each segment Healthcare services Portfolio businesses Sweden Revenue (MEUR), Adj. EBITA % Revenue (MEUR), Adj. EBITA % Revenue (MEUR), Adj. EBITA % +4% 250 -4% +15% 250 239 20 80 74 10 30 10 71 26 70 200 15% 8 25 22 8 15 60 7% 149 31 25 142 20 150 50 6 6 13% 10
Slide 13: Year-on-year profitability weighted by decline in COVID-19 testing and increased costs
Year-on-year profitability weighted by the decline in COVID-19 testing and increased costs REVENUE, MEUR AND ADJUSTED EBITDA*-% ADJUSTED EBITA*, MEUR AND % +3.4% 327.5 329.7 334.8 341.1 -6.4% 318.2 41.9 39.3 38.9 38.2 279.7 278.7 275.3 273.1 276.4 36.5 257.4 240.2 30.9 31.5 19.2 19.5 19.1 29.5 29.7
Slide 14: We continue to focus on efficiency and productivity
We continue to focus on efficiency and productivity Share of different costs as % of revenue • Build-up phase of digital capabilities to support Q1/2022 Q1/2023 IT Expenses omnichannel ready, capability to optimize Materials 3,5% 3,2% Premises 1,5% 1,9% • Includes private practitioner fees, sensitiv
Slide 15: Overall capex decreasing, more investments to premises and equipment
Overall capex decreasing, more investments to premises and equipment LTM GROSS CAPEX, MEUR AND %- OF REVENUE 59 58 58 4,7 4,6 4,6 4,5 54 4,5 53 4,1 4,1 4,2 3,9 3,9 48 46 3,7 3,5 3,4 26 40 41 32 30 38 38 23 37 29 19 35 25 18 17 21 20 19 19 22 20 19 18 19 21 14 13 14 16 13 12 14 7 7 7 6 6 7 7 9 10 5 4
Slide 16: Strong cash flow, solid balance sheet and credit profile
We maintained strong cash flow, solid balance sheet and credit profile OPERATING CASH FLOW (LTM), MEUR NET DEBT/ADJUSTED EBITDA (LTM) GROSS CAPEX (LTM), MEUR 195 189 3,8 175 176 3,3 3,1 3,2 153 150 152 3,0 142 141 2,5 2018 2019 2020 2021 2022 Q1 2023 LTM -35 -37 -41 -48 -54 -53 -59 -58 -58 Q1 Q2 Q3
Slide 17: Strong fundamentals, issuing guidance for 2023
Strong fundamentals, issuing guidance for 2023 FINANCIAL TARGETS GUIDANCE FOR 2023 • Terveystalo estimates its revenue for the full year 2023 to grow (2022: EUR 1,259 million) and its Growth adjusted EBITA margin to be between 9.1 % and At least 5% annual growth in revenue 10.1 %. • Estimates are ba
Slide 18: Welcome to Capital Markets Day
Welcome to Capital Markets Day In Helsinki, 10 May 2023 18 FOOTER
Slide 19: terveystalo.com
Terveystalo MEANINGFUL MATTERS terveystalo.com
Slide 20: Appendix
Appendix Terveystalo
Slide 21: Outsourcing contract portfolio will shrink as old contracts expire
The outsourcing contract portfolio will shrink in the coming years as old contracts expire CONTRACT VALUE INCLUDING OPTIONS, OLD OUTSOURCING CONTRACTS 122 Contracts Options 81 78 1 1 60 61 122 1 19 43 80 77 59 20 20 42 4 23 16 2022 2023 2024 2025 2026 2027 2028 21 FOOTER
Slide 22: Cuts to discretionary spending and profit improvement program launched
Cuts to discretionary spending and profit improvement program launched to combat cost increases M€ 1-3/2023 1-3/2022 Change % 2022 Revenue 341.1 329.7 3.4 1 259.1 Other operating income 1.3 0.5 170.8 2.7 Purchase of materials -10.9 -11.4 -3.9 -44.1 Change in inventories 0.0 0.2 -73.0 0.2 External se
Slide 23: Key figures
Key figures Terveystalo Group, MEUR 1–3/ 1–3 Change, % 2022 2023 2022 Revenue 341.1 329.7 3.4 1,259.1 Adjusted EBITA * 1) 36.5 38.9 -6.4 105.2 Adjusted EBITA, % * 1) 10.7 11.8 - 8.4 EBITA 1) 27.0 38.3 -29.4 95.9 EBITA, % 1) 7.9 11.6 - 7.6 EBIT 19.1 31.2 -38.9 33.9 EBIT, % 5.6 9.5 - 2.7 Return on equ