Astrana Health Inc. · NASDAQ:ASTH
Astrana Health — Apollo Medical Holdings — Investor Presentation (December 2020)
41 slides from Astrana Health's investor presentation, Dec 16, 2020
Slide 1: A Leader in Integrated Healthcare Management and Delivery Powered by Technology
A Leader in Integrated Healthcare Management and Delivery Powered by Technology. Built by Doctors. For Patients. December 2020 NASDAQ: AMEH
Slide 2: Forward-Looking Statements
Forward - Looking Statements This presentation contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 , Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward - looking statements include any statements about the Compa
Slide 3: Company Overview
Company Overview Apollo Medical Holdings, Inc. (“ApolloMed”) is a leading physician-centric, technology-powered, risk-bearing healthcare management company. Leveraging its proprietary population health management and healthcare delivery platform, ApolloMed operates an integrated, value-based healthc
Slide 4: Investment Highlights
Investment Highlights Multifaceted growth strategy driven by national shift to value - based care , creating large market opportunity Margin expansion through proprietary technologies 4 www.apollomed.net Value - based care model supported by proprietary integrated health management & healthcare deli
Slide 5: Where ApolloMed Fits in the U.S. Healthcare Ecosystem
Where ApolloMed Fits in the U.S. Healthcare Ecosystem 5 Through its MSO, consolidated IPAs, and ACO, ApolloMed is one of the nation’s largest population health management companies and one of few that provides full spectrum of care . MEMBERS Health Plans State & Federal Government Pay taxes Pay thro
Slide 6: Our Service Offerings & Revenue Model
Across all aspects of care delivery, our offerings provide a steady revenue stream. Our Service Offerings & Revenue Model 6 Consolidated Independent Practice Associations (IPAs) Next Generation ACO / Risk Model Management Services Organization (MSO) Commercial EPO Commercial ACO • Network of primary
Slide 7: Organizational Overview
Together with our affiliated physician groups and consolidated entities, ApolloMed manages the medical lives of approximately 1.1 million members. Consolidated IPAs ~ 488 ,000 member lives Publicly Traded Parent Company M anagement S ervices O rganization (MSO) Leading California IPAs * Managed IPAs
Slide 8: How ApolloMed Provides Value-Based Care
We created a technology - powered platform to deliver value - based care through our horizontally and vertically integrated physician - centric model. How ApolloMed Provides Value - Based Care 8 Traditional Fee - for - Service Model ApolloMed’s Value - Based Care Model Siloed care with little coordi
Slide 9: Our Value-Based Care Model Benefits all Stakeholders
Our Value - Based Care Model Benefits all Stakeholders 9 • Improved health outcomes • Improved patient experience • Reduced out - of - pocket expenses for patients • Reduced burn - out with flexible schedules and greater work - life balance • Relief of administrative burden • Customized technology -
Slide 10: Integrated healthcare platform centered around the patient
Our next - generation integrated healthcare platform is centered around the patient . 10 Hospital Healthcare Cities Micro - Hospitals Skilled Nursing Facilities Sub - Acute Care: Assisted Living, Independent Living Senior Wellness Centers Palliative Care Home Health PCPs Specialists Hospitalists Anc
Slide 11: Select ApolloMed Points of Care
Select ApolloMed Points of Care 11 www.apollomed.net
Slide 12: Why Physicians Partner with ApolloMed
Business Transparency ApolloMed empowers its physicians to cost - effectively deliver the highest quality of care to its patients by aligning financial incentives around proactive and preventative healthcare. Why Physicians Partner with ApolloMed 12 ▪ Combination of clinical, administrative, and tec
Slide 13: Long-Term Relationships with a Diversified Payor Mix
Long - Term Relationships with a Diversified Payor Mix Average tenure with key payors 13 15 years Contribution from each top payor <15% total net revenue www.apollomed.net
Slide 14: Proprietary Technology Platform
Proprietary Technology Platform 14 ApolloMed combines technology and data analytics, powered by machine learning and artificial intelligence, with clinical expertise. Technology Expertise + = Operational Excellence Clinical Knowledge Artificial Intelligence Machine Learning Natural Language Processi
Slide 15: Proprietary Technology Platform
Proprietary Technology Platform 15 Our solutions address three key pain points in managed healthcare delivery: Automated Medical Claims Adjudication Utilization Management Automation Population Health Platform • Has processed >2.5 million claims with no human intervention across 14 IPAs and all line
Slide 16: The Market Opportunity
The Market Opportunity ApolloMed is at the intersection of provider services and healthcare technology. 16 www.apollomed.net
Slide 17: A Significant Market Opportunity in Provider Services
A Significant Market Opportunity in Provider Services 17 Provider services p opulation includes: (1) Source: CMS.gov – NHE Fact Sheet, physician and clinical services expenditures (2) Source: CHCF.org – California Personal Health Core Spending, 2017 – Quick Reference Guide (3) Source: Cattaneo & Str
Slide 18: Industry Peers
Ticker NASDAQ: AMEH NYSE: OSH NASDAQ: ONEM NYSE: EVH Business A leading physician - centric, technology - powered, risk - bearing healthcare management company A network of value - based, primary care centers for adults on Medicare A membership - based and technology - powered primary care platform
Slide 19: ApolloMed is Executing Clear Growth Strategy
ApolloMed is Executing Clear Growth Strategy 19 www.apollomed.net Consolidate additional IPAs Enter new markets and geographies, expand outreach through current ACO program presence in 15 states Continue to invest in technology, preventative care and automation to further drive clinical care capabil
Slide 20: Integration of Acquired IPAs
Integration of Acquired IPAs 20 APC acquired for approx. $45M in May 2019 APC acquired remaining 75% stake not already held for approx. $7.25M in August 2019 ApolloMed continues to implement processes to fully integrate the IPAs acquired in 2019 into its framework with expected completion within 3 y
Slide 21: Expanding Nationwide
Expanding Nationwide 21 ApolloMed is well positioned to increase our existing presence in California while exploring opportunities to expand our geographic footprint beyond the state. Counties Served We currently serve members in 15 states / territories… Current 2021 Goal ~1.1M Managed lives +500k >
Slide 22: Our Response to COVID-19
ApolloMed has implemented measures to support our members, physicians and employees during the ongoing COVID - 19 pandemic. Our Response to COVID - 19 22 Members Independent Providers Employees • Drive - t hru t esting s tations • Increased testing capabilities • Immediate access • Telehealth option
Slide 23: Investment Summary
Investment Summary 23 Large and rapidly growing market opportunity focused on value - based care A value - based care model supported by proprietary care management technologies A compelling financial model with predictable unit economics and potential upside from risk - sharing Multifaceted growth
Slide 24: Financial Overview
Financial Overview A History of Profitable Growth 24 www.apollomed.net
Slide 25: Historical Financial Profile
4,000 7,000 2017 2020 384,000 780,000 1,100,000 2014 2017 2020 CAGR: 27% $520 $561 $670 2018 2019 2020* Historical Financial Profile 25 Historical Revenue Growth Consistent Membership Growth Contracted Physicians Growth ($ in millions) (# of physicians) CAGR: 6% * midpoint of 2020 revenue guidance r
Slide 26: 2020 Guidance
2020 Guidance $ in millions Q3 2020 YTD Results 2020 Guidance Range Total Revenue $510.4 $665.0 - $675.0 Net Income $109.4 (1) $110.0 - $120.0 EBITDA (2) $173.1 (1) $182.0 - $194.0 Adjusted EBITDA (2) $90.8 $97.0 - $112.0 26 (1) Q3 2020 YTD net income includes pre - tax gain on sale of UCI of $99.6M
Slide 27: Quarterly Performance
$23 $53 Q3'19 Q3'20 $156 $180 Q3'19 Q3'20 Quarterly Performance 27 Q3 Quarter over Quarter Revenue Q3 Quarter Over Quarter Adjusted EBITDA 15% 1 34% R evenue increased primarily due to : ◦ A cquisition of Accountable Health Car e ◦ Organic growth of capitation rates at APC ◦ Shared savings earned fr
Slide 28: Revenue Breakdown
Capitation - Capitated fees for medical services via direct arrangements with managed care providers – Typically pre - paid monthly based on number of enrollees Risk Pool Settlements & Incentives - Full and shared risk capitation arrangements with certain health plans , local hospitals and Next Gene
Slide 29: Balance Sheet Highlights
Balance Sheet Highlights 29 $ in millions 9/30/2020 12/31/2019 $ Change % Change Cash and cash equivalents and investments in marketable securities $284.4 $219.7 $64.7 29.4% Working capital $235.2 $223.6 $11.6 5.2% Total stockholders’ equity $229.4 $192.3 $37.1 19.2% www.apollomed.net
Slide 30: Current Capitalization
Current Capitalization 30 ($ millions, except for per share price) Note: See appendix for EBITDA reconciliation. Balance sheet data as of 9/30/2020. (1) Excludes restricted cash of $67mm. www.apollomed.net ($ in millions, except per share price) Recent Share Price (as of 12/8/2020) $ 17.98 Common Sh
Slide 31: Outstanding Shares Explained
Outstanding Shares Explained www.apollomed.net 1 APC, an affiliated IPA, holds approx. 17.5 million ApolloMed shares, approx. 15.0 million ($300 million) of which, it received as consideration from ApolloMed as part of the 2019 transaction to more fully integrate APC’s financial results into ApolloM
Slide 32: Outstanding Shares Explained
(1) The Company estimates the number of weighted average shares used to calculate EPS for the quarter and year ended December 31 , 2020, will be approximately 37.5 million. Outstanding Shares Explained 2 In December 2020, approx. 5 million of APC’s shares of ApolloMed common stock will be distribute
Slide 33: Appendix
Appendix 33 www.apollomed.net
Slide 34: Management – A Team of Industry Veterans
Management – A Team of Industry Veterans 34 Executive Chairman & Co - CEO Co - CEO & President CFO & Interim Co - COO Chief Medical Officer Chief Administrative Officer Chief Technology Officer & Interim Co - COO • Joined AMEH in 2006 • Currently serves as Chairman of APC, Chairman of NMM since 2013
Slide 35: U.S. Value-Based Landscape – Providers
(Intermountain Healthcare) U.S. Value - Based Landscape – Providers 35 The value - based care landscape continues to broaden as more companies enter the market to take capitation risk directly or assist physicians in the transition to risk - based arrangements. Payor Owned Independent Other • Large
Slide 36: Reconciliation of Net Income to EBITDA and Adjusted EBITDA
Reconciliation of Net Income to EBITDA and Adjusted EBITDA 36 2020 2019 2020 2019 Net income $ 25.4 $ 10.7 $ 109.4 $ 19.0 Depreciation and amortization 4.7 4.9 14.0 13.8 Provision for income taxes 10.8 3.7 44.2 6.5 Interest expense 2.5 0.8 8.0 1.3 Interest income (0.8) (0.5) (2.5) (1.3) EBITDA $ 42.
Slide 37: TTM EBITDA Reconciliation
TTM EBITDA Reconciliation 37 December 31, March 31, June 30, September 30, TTM 2019 2020 2020 2020 2020 Net (loss) income $ (1.3) $ 3.0 $ 81.0 $ 25.4 $ 108.1 Depreciation and amortization 4.5 4.7 4.6 4.7 18.5 Provision for income taxes 1.7 1.6 31.9 10.8 46.0 Interest expense 3.4 2.9 2.7 2.5 11.5 Int
Slide 38: Guidance Reconciliation of Net Income to EBITDA and Adjusted EBITDA
Guidance Reconciliation of Net Income to EBITDA and Adjusted EBITDA 38 Low High Net income (1) $ 110.0 $ 120.0 Depreciation and amortization 19.0 20.0 Provision for income taxes 46.0 47.0 Interest expense 10.0 11.0 Interest income (3.0) (4.0) EBITDA $ 182.0 $ 194.0 Income from equity method investme
Slide 39: Use of Non-GAAP Financial Measures
Use of Non - GAAP Financial Measures This presentation contains the non - GAAP financial measures Earnings Before Interest, Taxes, Depreciation and Amortization (“EBIT DA”) and Adjusted EBITDA, of which the most directly comparable financial measure presented in accordance with GAAP is net (loss) in
Slide 40: Key Acronyms
Key Acronyms 40 ◦ ACO: Accountable Care Organization ◦ AIPBP: All - Inclusive Population - Based Payments ◦ APC: Allied Physicians of California IPA ◦ CMMI: Center for Medicare and Medicaid Innovation ◦ CMS: Centers for Medicare & Medicaid Services ◦ DME: Durable Medical Equipment ◦ Health Plan / Pa
Slide 41: For inquiries, please contact
For inquiries, please contact: ApolloMed Investor Relations Carolyne Sohn, The Equity Group (626) 943 - 6491 (415) 568 - 2255 investors@apollomed.net csohn@equityny.com NASDAQ: AMEH 41 www.apollomed.net
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