Slide 1: FY20 Results
FY20 Results Dr. Ian Kadish (MD & CEO) Anne Lockwood (CFCO) 25 August 2020 “Good Medicine is Good Business”
Slide 2: IDX Vision Statement
IDX VISION STATEMENT Integral Diagnostics 2
Slide 3: Delivering on Our Values
DELIVERING ON OUR VALUES Patients Medical Everyone Create Embrace First Leadership Counts Value Change • Served 660,000 • 196 reporting • 1,341 employees • Increased • Implemented an e- patients radiologists Operating NPAT referral pilot • Achieved an by 21.9% to including patient • Serviced 30,300
Slide 4: Financial Highlights
FINANCIAL HIGHLIGHTS 9.5% 21.9% 20.9% 4.9% 18.7% 37.9% 18.2% increase increase increase increase increase increase improved in in in in in in Statutory operating operating operating operating free cash Net debt NPAT NPAT EBITDA EPS revenue flow /LTM EBITDA $23.0m $31.2m $64.1m 17.0cps $274.1m $55.7m
Slide 5: DI Industry COVID-19 Impact: Australia
DI INDUSTRY COVID-19 IMPACT: AUSTRALIA Industry growth rates in Australia impacted by COVID-19 in March and June 2020 quarters Industry growth 12 month rolling growth rate by services 12 month rolling growth rate by benefits -- Long Term Average 4.7% (2020 (1.4%)) --Long Term Average 6.7% (2020 2.9%
Slide 6: We Did What We Said We Would Do
WE DID WHAT WE SAID WE WOULD DO FY20 achievements Targeted capital investment • Completed DI development at John Flynn Private Hospital, including new PET facility opportunities to drive organic • Installed 2nd CT at Pindara Private Hospital to capitalise on the MRI full licence growth • Completed i
Slide 7: We Did What We Said We Would Do Continued
WE DID WHAT WE SAID WE WOULD DO CONTINUED FY20 achievements Invested in recruitment and • Continued to offer the radiologist equity plan which was over-subscribed retention of highly skilled radiologists, clinical and • Conducted entity wide cultural survey to identify strengths and prioritise areas
Slide 8: FY20 financial performance
FY20 financial performance
Slide 9: Results Prior to Impact of AASB 16
RESULTS PRIOR TO IMPACT OF AASB 16(1) Operating FY20 results delivered strong growth and a defensive performance across the group despite COVID-19 $ millions FY20 FY19 Change ($) Change (%) Operating revenue(2) 274.1 231.0 43.1 18.7% Operating EBITDA (3) 64.1 53.0 11.1 20.9% EBITDA operating margin
Slide 10: Results with Impact of AASB 16 for FY20
RESULTS WITH IMPACT OF AASB 16 FOR FY20(1) Upward impact to FY20 EBITDA $11.6m, EBIT $1.8m and decline impact on NPAT ($0.8m) $ millions FY20 FY19(6) Change ($) Change (%) Operating revenue(2) ( no change from AASB 16) 274.1 231.0 43.1 18.7% Operating EBITDA(3) ($11.6m uplift is impact of AASB 16) 7
Slide 11: Reconciliation of Operating to Statutory
RECONCILIATION OF OPERATING TO STATUTORY $ million FY20 FY19 Change ($) Change (%) Operating NPAT 31.2 25.6 5.6 21.9% Non operating transactions net of tax Transaction and integration costs (4.8) (1.9) Share based payments (1.3) (0.6) Amortisation customer contracts (1.2) (2.5) (1) Write off of bran
Slide 12: Growth in Shareholder Returns
GROWTH IN SHAREHOLDER RETURNS Operating EBITDA - millions 70 60 50 40 64.1 53.0 30 34.9 38.1 33.5 20 FY 16 FY 17 FY 18 FY 19 FY 20 IDX Dividends Dividend cents per share 10.0 9.5 8.0 7.0 5.0 4.0 4.0(1) 4.0 4.0 5.0 5.5 4.0 3.0 4.0 FY 16 FY 17 FY 18 FY 19 FY 20 Interim Dividend Final Dividend • Strong
Slide 13: Revenue
REVENUE Solid underlying growth driven by new sites, investment in new equipment and eight months contribution from Imaging Queensland despite COVID-19 causing declines in revenue from March onward Operating revenue up 18.7% to $274.1m • Revenue Growth of $43.1 driven by • Imaging Queensland $38.7m
Slide 14: Operating Expenditure
OPERATING EXPENDITURE IDX continued to focus on cost control and was able to deliver responsible cost reductions to mitigate revenue declines in response to COVID-19 Operating margin of 23.3% slightly increased due to the financial impacts of COVID-19. IDX continues to deliver industry leading opera
Slide 15: Capital Management – Post AASB 16 Application
CAPITAL MANAGEMENT – POST AASB 16 APPLICATION Strong balance sheet with reduced leverage to support on-going growth strategy $ millions 30 Jun 20 30 Jun 19 30 Jun 18 • FY20 net debt of $124.4m (FY20: $119m) Cash and cash equivalents 58.0 21.0 20.8 Trade and other receivables 10.4 9.0 5.6 • Reducing
Slide 16: Cashflow and Cash Conversion
CASHFLOW AND CASH CONVERSION Strong business performance and cash conversion reflected in free cash flow growth FY20 FY20 • The application of AASB 16 will result in the $ millions Pre AASB Post FY19 same free cash flows (after adjusting for 16 AASB 16 cashflows on leases) however, conversion % will
Slide 17: Capital Expenditure
CAPITAL EXPENDITURE Increase in capex commensurate with size of the business and investment for future growth in line with our strategy $ millions(1) FY20 FY19 FY18 Replacement 9.4 10.7 8.8 Growth 16.7 9.7 5.2 Total 26.1 20.4 14 .0 Depreciation 14.8 10.5 9.2 Replacement capex of $9.4m lower than dep
Slide 18: COVID-19
COVID-19
Slide 19: Impacts of COVID-19 on Financial Performance – FY20
IMPACTS OF COVID-19 ON FINANCIAL PERFORMANCE – FY20 Patient Activity • Overall the Government imposed restrictions, including the cancellation of elective surgery and sporting activities, as well as a slowdown in regular hospital activity and patients’ reluctance to visit their doctors, resulted in
Slide 20: Impacts of COVID-19 on Financial Performance – FY20
IMPACTS OF COVID-19 ON FINANCIAL PERFORMANCE – FY20 Consumables • With our number one priority being the safety of our people and patients, we secured adequate supply of personal protective equipment for all our hospital and community sites and instituted strict screening, hygiene and infection cont
Slide 21: Response to Ongoing Impacts of COVID-19 During FY21
RESPONSE TO ONGOING IMPACTS OF COVID-19 DURING FY21 Current patient activity • July and to date August 2020 revenue has delivered a return of positive growth across all business units except where Government imposed restrictions due to COVID-19 have been re-instated: • Lake Imaging in Victoria (repr
Slide 22: Response to Ongoing Impacts of COVID-19 During FY21
RESPONSE TO ONGOING IMPACTS OF COVID-19 DURING FY21 • The pandemic and associated Government response can be expected to continue to have an impact on the Group, which cannot be accurately projected at this time • Our focus, as always, will be to keep our patients and employees safe and this will al
Slide 23: Regulatory update
Regulatory update
Slide 24: Regulatory Environment Activity
REGULATORY ENVIRONMENT ACTIVITY Australia: MRI Licences • 52 full MRI Licenses issued in FY19 of which IDX received an upgrade from a partial to full at Pindara Hospital on the Gold Coast. Competitors licences issued in Geelong and Mandurah have not to date materially impacted IDX’s MRI performance
Slide 25: Regulatory Environment Activity
REGULATORY ENVIRONMENT ACTIVITY IDX continues to work through membership of the executive of the Australian Diagnostic Imaging Association (ADIA) to address key regulatory issues within the industry including: • Extension of indexation across the remaining Medicare items • Funding settings to promot
Slide 26: Strategy
Strategy
Slide 27: IDX Operates in Key Geographic Markets
IDX OPERATES IN KEY GEOGRAPHIC MARKETS (INCLUDING ASCOT RADIOLOGY) Total IDX Geographic Western Victoria Queensland New Zealand Queensland Market Australia Ballarat, Geelong, Sunshine Gold Coast, South West Warrnambool Coast, Core markets Toowoomba Western Auckland and outer Rockhampton and Mackay A
Slide 28: Management's FY21 Strategy – Good Medicine Is Still Good Business
MANAGEMENT’S FY21 STRATEGY – GOOD MEDICINE IS STILL GOOD BUSINESS Strategy 1 Grow existing business and margin 2 Strategic acquisitions Accelerate use Drive organic of digital and Nurture and AI technology Drive our Drivers of growth, develop to improve the environmental, strategy business culture a
Slide 29: FY21 Key Priorities and Focus
FY21 KEY PRIORITIES AND FOCUS FY21 Priorities and Focus • Manage ongoing impacts of COVID-19 Drive organic growth, business integration • Continue to integrate Imaging Queensland and integrate Ascot Radiology into the IDX Group and further efficiency • Ensure capex investment continues to generate s
Slide 30: Questions?
QUESTIONS? Integral Diagnostics 30
Slide 31: Disclaimer
DISCLAIMER Some of the information contained in this presentation contains “forward-looking statements” which may not directly or exclusively relate to historical facts. These forward-looking statements reflect Integral Diagnostics Limited (IDX) current intentions, plans, expectations, assumptions a
Slide 32: Contact Us
CONTACT US Investors & Media Dr Ian Kadish, MD & CEO P: +61 3 5339 0704 E: ikadish@idxgroup.com.au