Tivity Health — Merger or Acquisition (December 2018)
19 slides from Tivity Health's merger presentation, Dec 9, 2018
Slide 1: Tivity Health + Nutrisystem
Tivity Health + Nutrisystem Expanding our Healthy Lifestyle Brand Portfolio © 2018 Tivity Health, Inc. All rights reserved. 1
Slide 2: Cautionary Note on Forward-Looking Statements
Cautionary Note on Forward-Looking Statements Note On Forward Looking Statements This communication contains certain statements that are “forward-looking” statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of
Slide 3: Additional Information
Additional Information Important Additional Information and Where to Find It In connection with the proposed transaction, Tivity Health expects to file with the SEC a registration statement of Tivity Health on Form S-4 (the “registration statement”) that will include a proxy statement of Nutrisystem
Slide 4: "Our Why" Our Mission Our Vision
“Our Why” Our Mission Our Vision We empower adults to live their Transform the aging experience— best lives now—with vitality, dignity reducing the burden of chronic and purpose. We enable healthy conditions among adults, enabling aging—both in place, and in them to live their best lives. community.
Slide 5: Nutrisystem Overview – Ideal Fit
Nutrisystem Overview – Ideal Fit Nutrisystem is a rapidly growing, market leading weight loss program providing portion controlled meals and counseling to women and men of all ages Snapshot Full Year Revenue ($MM) $697 • Safe, effective and scientifically-backed weight-loss plans, with clinical $545
Slide 6: Nutrisystem Core Competencies
Nutrisystem Core Competencies Diverse offerings, marketing and analytical expertise, multi-channel experience and effective distribution driving growth in the business • Multiple brands with track records of success • Proven programs to address prediabetes and Type 2 diabetes • Strong ecommerce capa
Slide 7: Transaction Summary
Transaction Summary TRANSACTION VALUE • $1.3 billion in cash and stock • $38.75 per share in cash TERMS • 0.2141 Tivity Health shares for each share of Nutrisystem common stock PRO FORMA OWNERSHIP • 87% Tivity Health pro forma ownership on a fully diluted basis • Dawn Zier to become President and Ch
Slide 8: TODAY: Offering Fitness & Social Engagement Solutions
TODAY: Offering Fitness & Social Engagement Solutions Focused on “calories out” Fitness Current Brand Tivity Portfolio Addresses: Health • Fitness Living Well • Social Engagement & Nutrition Restoration © 2018 Tivity Health, Inc. All rights reserved. 8
Slide 9: TOMORROW: Expanded Portfolio of Healthy Lifestyle Brands
TOMORROW: Expanded Portfolio of Healthy Lifestyle Brands Focused on “calories in and out” Fitness Holistic Approach to Address: Tivity • Health • Overall Wellness Many Critical Health Needs, Living Well Including Weight & Nutrition Management Restoration © 2018 Tivity Health, Inc. All rights reserve
Slide 10: Addressing Unmet Critical Health Needs & Related Costs
Addressing Unmet Critical Health Needs & Related Costs Members will be able to balance calories in and calories out to help alleviate chronic conditions Weight-Related Costs of Chronic Conditions Chronic Conditions Hypertension Gallbladder disease At least 13 different • $190 billion: estimated annu
Slide 11: Highly Complementary Businesses Drive Accelerated Growth
Highly Complementary Businesses Drive Accelerated Growth Combined Platform & Complementary Competencies TIVITY HEALTH NUTRISYSTEM Shared Passion for • ~500 colleagues • ~600 colleagues Improving Lives • Tens of millions of Americans currently • 85 million people trying to lose eligible for SilverSne
Slide 12: The Road to 5 Million Enrolled SilverSneakers Members
The Road to 5 Million Enrolled SilverSneakers Members Deepen our relationships with our network of partner D locations and their community organizations C Collaborate with partners to introduce new products and services Build more awareness, empowerment, and B engagement in the eligible population A
Slide 13: Strong Financial Rationale With Significant Upside Potential
Strong Financial Rationale With Significant Upside Potential Generating Meaningful Value Driving Improved for Shareholders Financial Performance • Addition of a new independent • Significantly improved financial revenue stream profile • Cost and revenue synergies • Ability to invest in the growth of
Slide 14: Attractive Combined Financial Strength
Attractive Combined Financial Strength Pro Forma Combined Company $1.3 billion Combined LTM Revenue(1) • Better positioned to provide holistic health solutions to clients, members and consumers ~$135 million Combined LTM Net Income(1) • Strong management team ~$223 million Combined LTM Adjusted EBIT
Slide 15: Meaningful Value Through Synergies and Integration
Meaningful Value Through Synergies and Integration • Identified annual cost synergies of approximately We believe there are significant $30-35 million, anticipated to be fully achieved revenue opportunities through on a run rate basis by 2021 enhanced product offerings • Significant additional upsid
Slide 16: Substantial Cash Flow to De-lever the Balance Sheet
Substantial Cash Flow to De-lever the Balance Sheet Intend to finance cash portion of the acquisition with fully committed term loan financing from Credit Suisse and existing cash on hand At the closing of the transaction, Tivity Health’s pro forma net leverage is expected to be ~4.4x, including the
Slide 17: Summary
Summary NEXT STEP IN GROWTH Acquisition is the result of a comprehensive exploration of strategic growth OF TIVITY HEALTH opportunities and is a next step in our evolution. We have successful and complementary portfolios of leading brands with dedicated consumer and member followings. We also share
Slide 18: Appendix A
APPENDIX A Reconciliation of Adjusted EBITDA, Non-GAAP Basis to Net Income, GAAP Basis (in 000s) Twelve Months Ended September 30, 2018 Pro Forma Tivity Health(1) Nutrisystem (2) Combined Net income, GAAP basis 78,759 55,859 134,618 Adjustments: Depreciation and amortization 4,392 15,292 19,684 Rest
Slide 19: Thank You
Thank You 19 © 2018 Tivity Health, Inc. All rights reserved.
Tivity Health — Merger or Acquisition (December 2018) on 6ix