Sonic Healthcare Limited · ASX:SHL
Sonic Healthcare — Shareholder Meeting (November 2002)
24 slides from Sonic Healthcare's shareholder meeting presentation, Nov 13, 2002
Slide 1: Annual General Meeting
Annual General Meeting 13 November 2002 Colin Goldschmidt Managing Director
Slide 2: Agenda
Agenda • 2002 Financial Results • Revenue and Earnings • 1st Half 2003 Guidance • UK Pathology • Sonic Future Strategy • SciGen Spin Out Mark Compton (CEO) 2
Slide 3: 2002 Full Year Results
2002 Full Year Results 2002 2001 Change Revenue $M 859.8 627.9 +37% EBITDA $M 183.7 131.9 +39% EBITA $M 146.7 110.6 +33% NPAT $M 33.8 26.2 +29% NPAT* $M 83.2 56.4 +47% EPS* cents 33.3 28.1 +19% Cash Generated $M 146.7 67.2 +118% * Before Amortisation of Intangibles 3
Slide 4: EBITA Margins
EBITA Margins 2002 (1stHalf) 15.7% 2002 (2ndHalf) 18.3% 2002 Full Year 17.1% 4
Slide 5: Annual Revenue ($M)
Annual Revenue ($M) 1,200 975(F) 1,000 860 800 628 $M 600 387 400 200 0 2000 2001 2002 2003(F) Revenue 387 628 860 975 5
Slide 6: Sonic Healthcare 10 Year Annual Revenues
Sonic Healthcare 10 Year Annual Revenues 1,200 1,000 800 600 A$ M 400 200 0 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003(F) Revenue ($M) 33 47 57 89 134 147 173 387 628 860 975 6
Slide 7: EBITA ($M)
EBITA ($M) 200.0 180.0 174(F) 160.0 140.0 146.7 120.0 110.6 $M 100.0 80.0 70.8 60.0 40.0 35.9 20.0 0.0 1999 2000 2001 2002 2003(F) EBITA 35.9 70.8 110.6 146.7 174 7
Slide 8: EBITA Growth (%)
EBITA Growth (%) 60% 50% 40% 30% 20% 10% 0% 1997 1998 1999 2000 2001 2002 8
Slide 9: Earnings per Share
Earnings per Share 35.0 30.0 25.0 20.0 Cents per share 15.0 10.0 5.0 0.0 1995 1996 1997 1998 1999 2000 2001 2002 EPS* 5.8 8.0 9.5 11.8 16.7 21.7 28.1 33.3 Earnings per Share before Amortisation of Intangibles 9
Slide 10: EPS Growth (%)
EPS Growth (%) 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 1996 1997 1998 1999 2000 2001 2002 EPS = Earnings per Share before Amortisation of Intangibles 10
Slide 11: YTD 2003
YTD 2003 • Sonic performing within previous guidance range • 2003 Full Year Guidance (unchanged): 2002(A) 2003(F) Growth (%)* Revenue $860M $970-980M 13.4% EBITA $147M $172-176M 18.4% EBITA Margin 17.1% 17.75-18.00% • 2003 1st Half EBITA guidance - $80-82million • 2nd Half traditionally better than
Slide 12: EBIT Growth Drivers - 2003
EBIT Growth Drivers - 2003 • Revenue Growth/Marginal Profit – Market Growth – Market Share Growth – Synergistic Acquisitions • Synergies/Cost Management – SAT Program – Corporate Initiatives • Technology – IT – Workflow, instrumentation • UK Market 12
Slide 13: Funding
Funding • General government support for “front-end” diagnostic medicine • Funding Agreements – Radiology – June 2003 – Pathology – June 2004 • Trend towards bulk-billing has plateaued 13
Slide 14: UK Pathology
UK Pathology SONIC HEALTHCARE
Slide 15: TDL (The Doctors Laboratory)
TDL (The Doctors Laboratory) • TDL business tracking well – Revenue growing at over 15% – Q1, 2003 EBITA in line with budget • Plans progressing for new laboratory facility – In Harley Street district of central London – Sonic design – Sonic workflow – Capex ~£1 million • NHS opportunities – Sonic/T
Slide 16: Sonic UK Strategy
Sonic UK Strategy • Sonic/TDL Partnership – Sonic 15 year experience in Australia – TDL 15 year experience of UK market • Sonic/TDL/NHS Partnership – Service enhancements – Efficiency gains – Volume expansion – EBIT growth – Win-win outcomes • Expand private sector pathology – Organic – Acquisition
Slide 17: NHS Pathology - Background
NHS Pathology - Background • Long standing recognition of problems (Audit Commission 1991/93) – Quality issues – Staffing issues – Service Issues • Capital investment in pathology neglected over many years • Pressure to modernize pathology • Increased emphasis on partnerships with private sector in
Slide 18: July 2002 UK Department of Health
July 2002 UK Department of Health • Government believes private sector can make a positive contribution to NHS • Private Sector contribution includes investment, expertise, process redesign and project management Government’s Response to the House of Commons Health Committee’s First Report on the Ro
Slide 19: UK Pathology Market
UK Pathology Market • £1 - 2 billion per annum • Low spend by OECD standards • Spent largely in NHS • Annual growth 7 to 12 % 19
Slide 20: Pathology Spend as % of GDP
Pathology Spend as % of GDP UK 6.7% Western Europe ~12% USA 14.5% Australia 8.5-9.0% 20
Slide 21: April 2002 UK Health
April 2002 UK Health • “Catch-up” funding to 9.4% of GDP by 2008 • Increase of 7.5% above inflation expenditure on healthcare over next 5 years (2003-2008) • Reduce waiting lists and waiting times • Increase NHS infrastructure • Foster public-private partnerships State of Health Report :Delivering T
Slide 22: Models for Public Private Partnerships
Models for Public Private Partnerships • Facilities Management – Management Fee – Performance Bonus • Financial Partnering – Sharing of cost savings • Joint Venture • Outsourcing – Service Contracts 22
Slide 23: Sonic Future Strategy
Sonic Future Strategy • Pathology – Ongoing consolidation and rationalisation – SAT strategy to capture synergies – Organic, market share growth – Build relationships with independent healthcare entities – Acquisitions • Radiology – Organic growth and margin expansion – Capture synergies with Sonic
Slide 24: Thank you
Thank you [SONic HEALTHCARE
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