Sonic Healthcare Limited · ASX:SHL
Sonic Healthcare — H1 FY2010 Earnings Presentation
21 slides from Sonic Healthcare's earnings presentation, Feb 23, 2010
Slide 1: Half Year Results
Half Year Results For the period ended 31 December, 2009 Dr Colin Goldschmidt CEO, Sonic Healthcare 23 February 2010
Slide 2: Forward-looking statements
Forward-looking statements This presentation may include forward-looking statements about our financial results, guidance and business prospects that may involve risks and uncertainties, many of which are outside the control of Sonic Healthcare. Readers are cautioned not to place undue reliance on f
Slide 3: Highlights
Highlights Strong net profit growth in line with Sonic guidance Full year earnings guidance reaffirmed Ongoing, strong organic revenue growth in key global markets Australian pathology – 8% organic growth USA – 8% organic growth Europe – 5% organic growth Margin expansion in USA and Eu
Slide 4: FY 2010 Guidance Maintained
FY 2010 Guidance Maintained FY 2010 Guidance Net profit after tax (NPAT) growth 10 - 15% Constant currency rates (FY ‘09) Excludes acquisitions announced since guidance released in August 2009 (Medhold and East Side) Based on FY ‘09 NPAT of A$315 million Incorporates impact of Auckland contr
Slide 5: Financial Summary
Financial Summary H1 ’10 H1 ‘10 vs H1 ‘09 CONSTANT CURRENCIES* GROWTH Revenue A$M 1,566 9% EBITDA A$M 288 10% EBITA A$M 239 10% NPAT A$M 162 19% NPAT - growth adjusted for H1 ‘09 NRIs A$M 162 12% • *H1 ’10 constant currencies – presented using currency exchange rates applied in H1 ’09 • For equivale
Slide 6: Interim Dividend
Interim Dividend H1 ‘10 H1 ‘09 Change Interim Dividend A$0.24 A$0.22 9% Dividend franked to 35% Record Date 10 March 2010 Payment Date 25 March 2010 Dividend Reinvestment Plan remains suspended
Slide 7: Organic Revenue Growth
Organic Revenue Growth Excluding acquisitions Organic Revenue Growth* Acquisitions excluded Australian pathology 8% USA 8% Europe 5% Radiology 4% * Constant currency basis
Slide 8: Sonic Global Pathology Revenue
Sonic Global Pathology Revenue Revenue Contribution (H1 ‘10) 1,300 (18) 47 (76) 1,250 A$M 82 1,200 1,218 1,183 1,150
Slide 9: Revenue Split
Revenue Split H1 ‘10 Radiology $181 New Zealand IPN 12% Pathology $85 Australian $41 3% 6% Pathology $462 Switzerland 31% Geographical diversification: $34 2% Operations in 7 countries UK $48 3% (Belgium from 12 Feb 2010) Strong AUD understates off- Germany $293 USA shore revenues 20% $337 23% R
Slide 10: Sonic Global Pathology Earnings
Sonic Global Pathology Earnings EBITDA Contribution (H1 ‘10) 4 (3) 260 (13) 19 250 A$M 240 11 250 230 232 220
Slide 11: Synergies and Margin Expansion
Synergies and Margin Expansion Pathology A$19 million organic EBITDA added in H1 ‘10 USA – margin expansion of 80 basis points (bps) Follows >200 bps margin expansion in FY ‘09 Germany – margin expansion of 30 bps Follows >100 bps margin expansion in FY ‘09 Despite fee cuts from January
Slide 12: Sonic Debt Summary
Sonic Debt Summary Investment Grade Credit Metrics 31 Dec ‘09 30 Jun ‘09 31 Dec ‘08 Net interest-bearing debt A$M 1,149 1,198 1,536 Gearing ratio % 31.3 32.1 36.5 Interest cover X 9.7 6.5 5.7 Debt cover X 1.9 2.2 2.3 Long-term (7 and 10 years) US debt raising completed Jan ‘10 – US$250 million C
Slide 13: Australian Pathology
Australian Pathology Organic revenue growth 8% On track to offset fee cuts Billing initiatives Targeted at complex tests and hospital work Pensioners/health care card holders exempted Ramped up in November/December 2009 Margins maintained despite fee cuts Sonic’s business – robust, c
Slide 14: Operational Highlights
Operational Highlights H1 ‘10 5 acquisitions completed in past 6 months 4 highly synergistic - Axiom, Piedmont, East Side, Lademannbogen 1 new beach head – Medhold (Belgium) Pipeline of new acquisitions USA Strong and stable operations Synergy capture delivering margin increment Germ
Slide 15: Sonic Imaging
Sonic Imaging Challenging market conditions Revenue growth 4% Long awaited fee increases effective 1 November 2009 Management focus on tools for improved efficiency: ‘doctors desktop’ Outlook more positive as fee changes flow through
Slide 16: Belgium – Medhold Acquisition
Belgium Medhold Acquisition Acquisition of Medhold Group Transaction successfully completed 12 Feb 2010 Immediately EPS accretive – 4-5% EPS accretion in FY ‘11 Medhold an ideal partner for Sonic Culture and values very similar Experienced, outstanding management team Annie Vereecken,
Slide 17: Belgian Lab Market
Belgian Lab Market Stable healthcare system − statutory insurance (mandatory) and optional private cover Pathology market ~€1.4 billion with >50% private Long-term average market growth of ~5% p.a. Same fee schedule applicable to public and private sectors Doctor-collect system, no collect
Slide 18: Belgium – Medhold Acquisition
Belgium Medhold Acquisition Netherlands Lokeren Antwerp Bruges Brussels Genk Flanders region Wallonia region Head office and main lab in Antwerp Brand new, ultra-modern, 6,000m² laboratory in Antwerp 5 locations, >300 staff and >30 pathologists Central hub lab for testing from Belgium and Ne
Slide 19: Outlook
Sonic Healthcare Outlook On track to deliver full-year earnings guidance Strong revenue and earnings to continue Additional synergistic acquisitions in Germany, USA and Belgium Synergy activity in USA and Europe active and ongoing Resilient business model and global infrastructure Strong
Slide 20: Sonic Healthcare – Key Attributes
Sonic Healthcare – Key Attributes GROWTH Strong , consistent revenue and earnings growth Track record of acquisitions, integration, synergy Diagnostic industry growth – ageing population, preventative medicine, new tests SECURITY Investment grade balance sheet Global operations – sprea
Slide 21: Thank You
SONIC HEALTHCARE THANK YOU