Masimo Corporation · NASDAQ:MASI
Masimo — Investor Presentation (June 2024)
28 slides from Masimo's investor presentation, Jun 20, 2024
Slide 1: Investor Presentation June 2024
Investor Presentation June 2024 Exhibit 99.1
Slide 2: Safe Harbor Statement
2 Safe Harbor Statement This presentation contains forward - looking statements within the meaning of federal securities laws, including, among others, st atements about our expectations, plans, strategies or prospects. We generally use the words “may,” “will,” “expect,” “believe,” “anticipate,” “pl
Slide 3: Disclaimer Regarding Potential Separation
3 Disclaimer Regarding Potential Separation On March 22, 2024, Masimo announced that its Board of Directors has authorized management to evaluate a proposed separation o f t he company’s consumer business (the “Potential Separation”). Masimo’s Board of Directors and management are in the process of
Slide 4: Executive Summary: Separation of Consumer Business
Executive Summary Separation of Consumer Business Pursuing a separation that would result in two separate companies (consumer and professional healthcare). Key objectives of a separation: Maximize shareholder value as well as give both consumer and professional healthcare the best path for success.
Slide 5: Masimo's Healthcare Business Remains on Track for Growth
5 Summary Masimo’s Healthcare Business Remains on Track for Growth $131 $167 $179 $215 $380 $347 $390 $402 2017 2018 2019 2020 2021 2022 2023 Q1 2024 Incremental Value of New Contracts $MM $529 $614 $777 $878 $1,209 $1,364 $1,508 2018 2019 2020 2021 2022 2023 2024 Unrecognized Contract Revenue $MM,
Slide 6: Key Business KPI / Metrics
Incremental Value of New Contracts (1) $MM, through the first quarter of each year Driver Installed Base # of Units (MM) Total Consumable & Service Revenue $MM, shown at constant currency (2) Consumable & Service Revenue Per Driver $ / Driver 6 Key Business KPI / Metrics Masimo’s Healthcare Business
Slide 7: Growing Consumable & Service Revenue Across All Technology Platforms
SET Pulse Oximetry | Consumable & Service Revenue Shown at constant currency (1) Rainbow & Hemodynamics | Consumable & Service Revenue Shown at constant currency (1) Capnography & Gas Monitoring | Consumable & Service Revenue Shown at constant currency (1) Brain Monitoring | Consumable & Service Rev
Slide 8: Leading Noninvasive Monitoring Portfolio Delivering Outsized Growth
Masimo Has Built a Leading Noninvasive Monitoring Portfolio Delivering Outsized GrowthMarket Segment Total Addressable Market Market Growth Masimo LT Growth Masimo’s Unique Right to Win SET PulseOximetry (~73% Healthcare Revenue Contribution) ~$3 Billion ~3–4% 6-8% Only pulse oximetry with proven cl
Slide 9: Total Addressable Market
Total Addressable Market (1) $ in Billions 9 Masimo’s Innovation Has Led to Multiple Growth Levers and Opportunity to Gain Market Share Masimo Has Created Multiple Waves of Innovation to Support Sustainable Long - Term Growth $4.3 $2.0 $2.5 $- $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 Pulse Oximetry, Capnograph
Slide 10: Masimo's Long History of Disruptive Innovation
10 Masimo’s Long History of Disruptive Innovation SpCO ® RRa ® SpMet ® PVi ® SpHb ® O3 ® RRp ® Patient SafetyNet NomoLine ® MightySat ® Rx Rad - 97 ® Telehealth Masimo founded 3% SpO 2 Motion Accuracy Measure - through Motion & Low Perfusion TM Pulse Oximetry 1989 2000 2005 2006 2007 2008 2009 2011
Slide 11: rainbow Platform Revenue and ORi
Total rainbow® Revenue $MM, shown at constant currency (1) Continuous DO2: rainbow® + LiDCO ORi New rainbow ® Parameter Oxygen Reserve Index ( ORi TM ) Revenue Shown as a percentage of total OUS rainbow® revenue (2) 11 rainbow ® Platform $76 $95 $113 $127 $141 $171 $199 2017 2018 2019 2020 2021 2022
Slide 12: Innovation: Hospital Automation
12 Innovation Hospital Automation Early Wins • Cleveland Clinic • Vanderbilt University • National Guard (Saudi Arabia) • St Luke Medical Center • Germans Trias i Pujol (Spain) • Chalon - sur - Saône (France) • University Hospitals Radius VSM ® is a wearable vital signs monitoring platform that incl
Slide 13: Telehealth: Masimo W1 Medical Watch
13 Telehealth Masimo W1 ® Medical Watch Transformative Technology 510(k) Clearance for Over - the - Counter and Prescription Use The only accurate, Continuous wrist - worn health watch. Targeting chronic care management, early discharge and hospital at home. Per - patient service model or capital +
Slide 14: Next Generation Wireless Sensors and Platforms Expand Addressable Market
14 Our Next Generation Wireless Sensors and Platforms will Expand our Addressable Market Opportunity While Driving Margin Expansion Today 2024 2025 • Most innovative clinical grade wearables ‒ Patient monitoring systems • Medical device integration and connectivity Reven u e Time $1.2B+ Market Oppor
Slide 15: Professional Healthcare (RemainCo) Targeting 7-10% Revenue Growth through 2029E
15 Professional Healthcare (RemainCo) Targeting 7 - 10% Revenue Growth through 2029E 2024E Revenue Mix (1) 2024E – 2029E Revenue Growth Rate Contribution (1) 4% - 6% 1.5% 0.5% - 1.0% 0.5% - 1.0% 0.5% 7% - 10% Total Hospital Automation & Telemonitoring Brain Monitoring Capnography & Gas Rainbow & Hem
Slide 16: 2024 Guidance and Separation Adjustments
($ in millions; except EPS) Revenue $2,110 ($740) GAAP Gross Profit $1,060 ($218) GAAP Gross Margin 50.2% 1,130 bps Non-GAAP Gross Profit $1,096 ($241) Non-GAAP Gross Margin 51.9% 1,050 bps GAAP Operating Profit $196 $14 $47 - $70 $61 - $84 $257 - $280 GAAP Operating Margin 9.3% 600 bps 360 bps - 52
Slide 17: Financial Impact of a Potential Separation: Path to ~30% Operating Margin
Preliminary Estimate: Financial Impact of a Potential Separation (2) Margin Improvement Initiatives: 520 bps to 580 bps 17 Professional Healthcare (RemainCo) Path to ~30% Non - GAAP Operating Margin by 2029E (1) 15.0% 23.2% to 24.8% 600 bps 220 – 380 bps 350 bps 100 bps 70 – 130 bps 29.0% to 30.0% x
Slide 18: Financial Impact of a Potential Separation: Path to ~$8 EPS
Preliminary Estimate: Financial Impact of a Potential Separation (2) 18 Professional Healthcare (RemainCo) – Excludes Benefits of Any Cash Proceeds from Potential JV Path to ~$8 Non - GAAP Earnings Per Share by 2029E (1) Adjustments to remove net income for consumer audio Adjustments to remove net l
Slide 19: Gross Margin Benchmarking vs Peers
60.7% 52.3% 48.0% 68.5% 66.8% Masimo (WholeCo) Medical Devices Index Select MedTech Peers 48.0x 25.9x 25.5x Gross Margin Benchmarking vs Peers (Includes Large Cap MedTech, High - Growth MedTech and Hospital Mid - Cap Peers) 2019A – 2023A Gross Margin (1) 19 Masimo's Gross Margin In - Line with Pee
Slide 20: R&D Benchmarking vs Peers
Notes: 1. Masimo figures reflect non - GAAP R&D expense based on company filings; Peer Indexes reflect R&D inclusive of one - time adjustments made by Capital IQ 2. Median of 2019A – 2023A R&D margin calculated on a company - level basis; 25 th percentile to 75 th percentile of medians across the co
Slide 21: SG&A Benchmarking vs Peers
Average ’19A - ’23A NTM P/E: SG&A Benchmarking vs Peers (Includes Large Cap MedTech, High - Growth MedTech and Hospital Mid - Cap Peers) 2019A – 2023A Average SG&A as % of Total Sales (1) 21 Masimo’s SG&A Spend Lower Than Industry Peers 30.6% 26.0% 26.7% 50.4% 37.3% Masimo (WholeCo) Medical Device
Slide 22: Operating Margin Benchmarking vs Peers
Operating Margin Benchmarking vs Peers (Includes Large Cap MedTech, High - Growth MedTech and Hospital Mid - Cap Peers) 2019A – 2023A EBIT Margin (1) 22 Masimo’s Operating Margin is Higher Than Peers Today , with Path to Further Outperformance Clearly In View Source: Company Filings, Capital IQ Note
Slide 23: Key Takeaways
23 Key Takeaways Pursuing separation with key objectives to maximize shareholder value and give both consumer and professional healthcare businesses the best path for success. Growing through innovation that enables us to win incremental new contracts, increase sensor utilization, and leverage large
Slide 24: Appendix: GAAP to Non-GAAP Reconciliations
¥ Masino Appendix GAAP to Non-GAAP Reconciliations
Slide 25: GAAP to Non-GAAP Gross Profit Reconciliation
25 (Unaudited; in millions, except per share data) (1),(3) Quarter to Date Q2 2024 Guidance (2) Full Year FY 2024 Guidance (2) Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Low High FY 2022 FY 2023 Low High GAAP revenue $304.2 $565.3 $549.3 $617.0 $565.0 $455.3 $478.9 $548.
Slide 26: Consolidated Income Statement Reconciliation
26 Consolidated Income Statement (Unaudited; in millions, except per share data) (1),(3) Quarter to Date Q2 2024 Guidance (2) Full Year FY 2024 Guidance (2) Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Low High FY 2022 FY 2023 Low High GAAP non-operating income (expense) (
Slide 27: Revenue Reconciliation
27 Revenue (Unaudited; in millions, except percentages) (1,3) Quarter to Date Q2 2024 Guidance (2) Full Year FY 2024 Guidance (2) Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Low High FY 2022 FY 2023 Low High Revenue Healthcare 304.2 357.0 327.2 351.9 346.7 281.1 307.8 339
Slide 28: Segment Reporting
28 Segment Reporting (Unaudited; in millions) (1) Quarter to Date Q2 2024 Guidance (2) Full Year FY 2024 Guidance (2) Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Low High FY 2022 FY 2023 Low High Revenue Healthcare 304.2 357.0 327.2 351.9 346.7 281.1 307.8 339.9 339.6 330