Metropolis Healthcare Ltd. · NSE:METROPOLIS
Metropolis Healthcare — Q1 FY21 Earnings Presentation
63 slides from Metropolis Healthcare's earnings presentation, August 2020
Slide 1: Reaching Out Responsibly: Investor Presentation August 2020
Reaching Out RESPONSIBLY Investor Presentation - August 2020
Slide 2: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Metropolis Healthcare Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any
Slide 3: Q1 FY21 Financial & Operational Performance
Q1 FY21 Financial & Operational Performance
Slide 4: Q1 FY21 Financial & Operational Highlights
Q1 FY21 Financial & Operational Highlights Metropolis is a Strong Consumer Focused and Trusted Pathology Brand in the Indian Diagnostics space ... Rs. 143 Crs 51% 1.37 Mn 2.65 Mn Quality Focus Revenue Share Large test Menu Revenues Patient Visits No. of Tests of B2C in Customer Centricity Approach F
Slide 5: Gradually Returning to Normalcy
Gradually Returning to Normalcy Month-wise Revenue (In Crs.) Month-wise EBIDTA* (In Crs.) ✓ On account of All India lockdown and subsequent -62.6% 16.9 travel restrictions, we witnessed 62.6% drop in 67.9 revenues for April 2020 and 26.6% drop in April April 25.4 revenues for May 2020 on a Y-o-Y bas
Slide 6: Witnessing improving revenues on Month on Month basis
Witnessing improving revenues on Month on Month basis 68.1 Total Revenues 49.1 ✓ With Increased operations across Lab & Collection network 25.4 on a month on month basis, revenues have scaled up substantially in June 2020 compared to April 2020 Apr-20 May-20 Jun-20 ✓ Revenues could have been better,
Slide 7: Challenges witnessed in our return to Normalcy
Challenges witnessed in our return to Normalcy ✓ The Covid-19 Pandemic severely affected people movement due to 100% Estimated Level of Operations Tier 3, strict implementation of lockdown particularly in West & South (Management Estimates) 80% Villages & Indian cities such as Mumbai, Chennai, Pune
Slide 8: Cost Rationalization Outcome
Cost Rationalization Outcome… FY20 Fixed Cost Semi-Variable Cost Variable Cost FY21 -9% -12% -21% 10% 5% -11% -8% -5% -35% -10% -45% -15% April May June Q1 April May June Q1 April May June Q1 ✓ We initiated cost rationalization program in April 2020 and were able to reduce fixed costs by 9%, semi-va
Slide 9: …with Focus on Balance Sheet
…with Focus on Balance Sheet Debtors Days* Working Capital Days* 62 11 ✓ Despite higher B2B revenues in 52 Q1FY21, we have continued to focus on collection efficiency and improved our Debtor days & Overall Working 5 Capital days ✓ Metropolis is a Zero-Debt company with growing cash & cash equivalent
Slide 10: H1 FY21 Outlook
H1 FY21 Outlook Revenue Trend* (E) Margin Trend* (E) April May June July August April May June July August Estimates Actuals Estimates Actuals ✓In the month of April 2020 on account of nation-wide lockdown and subsequent restrictions large part of our revenues were contributed by Covid-19 testing. ✓
Slide 11: Operational Highlights of Q1FY21
Operational Highlights of Q1FY21 ✓ 5 new tests added to the Metropolis menu during Q1FY21 despite challenging times New Tests ✓ 4 tests were added Chemistry & 1 test was added in the specialized category of Molecular Biology ✓ New Financial module “Oracle NetSuite” is live from August 2020 Technolog
Slide 12: Covid-19 - A catalyst for Consolidation of Indian Diagnostic Industry
Covid-19 - A catalyst for Consolidation of Indian Diagnostic Industry 05 Faster Consolidation and 01 Strong Brands to benefit 03 Covid-19 capable labs Unorganised standalone labs Covid-19 will become a new regulatory adoption are facing challenges in terms normal test in times to come,; We expect fa
Slide 13: Q1 FY21 Consolidated Financial Performance
Q1 FY21 Consolidated Financial Performance EBIDTA Rs. (In Crs) PAT (Rs. in Crs) Revenue Rs. (In Crs) Before CSR & ESOP Reported EBIDTA Rs. (In Crs) 27.4% 9.1% 27.1% 8.5% 13.3% 2.0% -29.7% 203 -76.6% -78.0% -89.2% 55.6 55.1 26.9 143 13.0 12.1 2.9 Q1FY20 Q1FY21 Q1FY20 Q1FY21 Q1FY20 Q1FY21 Q1FY20 Q1FY2
Slide 14: Operating Performance
Operating Performance No. of Patient Visits (In Mn.) Revenue Per Patient (In Rs.) ✓ Revenue per Patient & Revenue per Test has increased on -41.8% +20.6% -5.2% account of high value Covid-19 +12.6% 2.35 1,043 865 820 test 10.0 865 8.9 7.7 ✓ On a like to like basis (Non-Covid) 7.0 1.37 Revenue per Pa
Slide 15: Network Expansion
Network Expansion Laboratory Network Service Network Lab on Lease ARC Greenfeild +9.3% Third Party PSCs 119 124 124 2,731 2,610 Owned PSCs 106 19 20 20 2,336 598 95 8 6.4x 558 2 575 1,650 520 98 100 104 104 1,873 1,803 93 887 1,506 428 308 879 151 356 117 223 251 255 260 249 160 FY17 FY18 FY19 FY20
Slide 16: Share of B2C Business in Focus Cities
Share of B2C Business in Focus Cities B2C Contribution in Focus Cities (excl. Covid-19 Revenues) (Rs. in Crs) ✓ Excluding Covid-19 revenues, our B2C contribution B2C has remained intact despite large part of network 45% 48% 52% 56% 55% 55% facing operational challenges in April & May on Ratio accoun
Slide 17: Market Dynamics – a long runway of growth
Market Dynamics – a long runway of growth Revenue Mix between Focus, Seeding & Others Cities Revenue Mix between Geographies 5% 9% 7% 8% 20% 18% 23% 25% Q1FY20 Q1FY21 Q1FY20 Q1FY21 58% 19% 22% 63% 53% 4% 58% 6% Others Seeding Focus North South East West International Improving Revenue Diversificatio
Slide 18: Specialized Test Menu capabilities creates a sustainable leadership position
Specialized Test Menu capabilities creates a sustainable leadership position Volume Mix Value Mix 3% 2% 6% 12% 15% 13% 13% 14% 43% 44% Q1FY20 Q1FY21 Q1FY20 Q1FY21 36% 29% 52% 37% 41% 40% Routine Specialized Routine Specialized Semi-Specialized Wellness & Others Semi-Specialized Wellness & Others Imp
Slide 19: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars (Rs. Crs.) Q1FY21 Q1FY20 Revenue from Operations 142.7 203.0 Cost of Raw Material Consumed 38.3 48.4 Laboratory Testing Charges 2.1 1.5 Employee Expenses 50.8 54.3 Other Expenses 38.4 43.2 EBIDTA before CSR and ESOP 13.0 55.6 CSR 0.1 0.3 ESOP 0.9 0.2
Slide 20: Ramping up Home Testing offerings
Ramping up Home Testing offerings Productivity Enhancement Higher Demand for Home Testing 5 1 Witnessing a surge in Home test Increased productivity and collection personnel to cater to this increased opportunity; driving requests especially in Tier 1 cities productivity enhancement at agent level B
Slide 21: Enhancing Customer Experience… Digital
Enhancing Customer Experience… Digital Increased communication efforts through Rigorous Campaigns to assure customers on safety and hygiene of Metropolis centers and Home testing services Fully Integrated Website and APP for Online booking, multiple payment modes, digital reports, report storage as
Slide 22: Digital & E-Commerce Initiatives… increasing traction
Digital & E-Commerce Initiatives… increasing traction Current Metropolis Trends Digital strategy is playing important role & will be the key driver for 3x increase in Call centre website traffic, Centres Volumes compared to increased by 2X pre-COVID due to digital period outreach Brand Creation Our
Slide 23: Metropolis is… Test Assured Rest Assured
Metropolis is… Test Assured Rest Assured Click here to watch the full video 23
Slide 24: Metropolis… Serving the Nation
Metropolis… Serving the Nation TEST ASSURED REST ASSURED Some of the safety measure include having separate resource for Covid-19 and regular tests, maintaining social distancing, disinfecting our premises regularly monitoring our staff’s health and ensuring proper use of protecting gear & more Be i
Slide 25: Overview
Overview
Slide 26: We are Metropolis: The Pathology Specialist
We are Metropolis: The Pathology Specialist To be a respected healthcare brand trusted by clinicians, patients and stakeholders. Positively impact lives of patients Vision in their most anxious times and turn their anxiety in to assurance. Helping people stay healthy, by accurately revealing their 3
Slide 27: Journey to Leadership Position
Journey to Leadership Position ✓ First Referral Laboratory Set- ✓ Ameera Shah takes charge ✓ Secondary transaction by ✓ Exit of Warburg Pincus, ✓ Strong Thrust on Retail up by Founder & Chairman Dr. Foxcreek Investment Limited management control by frontend Expansion ✓ First major acquisition - Sush
Slide 28: Three decades of Delivering Value to Stakeholders
Three decades of Delivering Value to Stakeholders Leadership Position Across Industry METROPOLIS Focus Area ACCREDITATION CUSTOMER & QUALITY EXPERIENCE ROCE SPECIALITY SCORES SCORE BUSINESS INCREASED INFRASTRUCTURE PRODUCTIVITY REVENUE PER REALISATION PER TEST MENU OF YOUNG PATIENT PATIENT NETWORK 2
Slide 29: Key Drivers for Growth
Key Drivers for Growth 01 Industry Growth 05 Expansion Plan 02 Value Chain 06 Quality 03 Business Model 07 People 04 Service Network 08 Digital Transformation 29
Slide 30: Diagnostic Industry Poised to grow…
1a. Diagnostic Industry Poised to grow… Size of Indian Healthcare Industry Size of Indian Diagnostics Market Indian Diagnostics Industry Breakup (in Billion $) 6.0% 4.0% 35% 12.3 9.0% Healthcare Delivery - Hospitals Pharma 9.1 42% Pathology 13.0% Medical Devices Radiology 68.0% Diagnostics 58% Healt
Slide 31: Top players to continue to acquire market share of standalone centers
1b. Top players to continue to acquire market share of standalone centers Brand Awareness Increased brand awareness amongst patients and customers towards quality, reliability and test accuracy Service + Scale Large Test menu Large Test menu by organized diagnostics chains Factors leading Consolidat
Slide 32: Presence in key pockets of Value Chain
2.Presence in key pockets of Value Chain Diagnostic Industry - Fragmented Routine Test Metropolis Focus Highly Fragmented Market Low Quality Standard Majority Diagnostic Players Technician + Run Lab Low on Technical Qualifications & Moderate Competition Presence across Accreditations (99.9% labs rem
Slide 33: Hub & Spoke Model to scale efficiently
3. Hub & Spoke Model to scale efficiently Home Collection Global Reference Lab (GRL) Individual Patient (B2C) Wholesale (B2B) RRL / Satellite Lab Express Lab Third Party Lab / Hospitals / ARCs Collection Patient Centres Patient Leverage Widespread Delivery to our Enhances Collection of Greater netwo
Slide 34: Patient Centric Network
4.Patient Centric Network Global and More than ~4,000 Present in 19 States 35+ Years National Over 10,000 Patient Test’s & Profiles & 210 cities Quality Touch Points of Credible Operations Accreditations Why Metropolis ? Collection ✓ Conclusive Diagnosis with Large Centres Pics test Menu backed by H
Slide 35: Asset Lite Expansion Plan
5. Asset Lite Expansion Plan Asset Light Model Network Expansion Strategy Doctor APSC/ Lab on ✓ Focus on Asset Light Model to achieve Geographic Expansion with Bleeding DAPSC Lease High Scalability Point (DBP) ✓ The A-PSC and D-APSC Model allows us to grow our revenues by providing management and br
Slide 36: Quality in Core
6a. Quality in Core Quality Scores of 98.5% in 2018-19 by College Quality protocols following global standards of American Pathology 99.9% of industry labs remain un-accredited with lack of minimum standards in the industry Large Investments in Focus on Governance Information and rigorous audit Tech
Slide 37: Globally Compliant Quality Standards
6b. Globally Compliant Quality Standards No. of Audits Conducted by PAC Team “Global Lab Accreditations” FY 17-18 18-19 H1 20 FY 20 665 1,312 597 1,057 ✓ PAC Team: Special Pre Analytical Care Team constituted as part of the Quality Assurance Team ✓ This team conducts thorough internal audits as per
Slide 38: People are our greatest asset
7. People are our greatest asset ✓ New HR Management System for ✓ Strong culture equal opportunity ✓ Full Fledged Learning Management automated processes improving workplace System that is used for daily training productivity and ensuring availability of across the Company. employee data on demand ✓
Slide 39: Leveraging IT for Competitive Advantage
8. Leveraging IT for Competitive Advantage 1 2 3 4 Improving Business revenue Improved Operational Improve Customer Cost Saving & Optimization generation capabilities Efficiency Experience ✓ Zero Data Loss; 100% data ✓ IBM Watson Campaign Automation replication in remote location ✓ Mobility Applicat
Slide 40: Digital Transformation to improve efficiency
8a. Digital Transformation to improve efficiency 1 Standardization Achieve standardization across 2 Reduced Errors Reduce incidence of errors due to human intervention our operations Patients & Customers 3 Technical Operations Provide convenience to our 5 Monitor Technical Operations patients and cu
Slide 41: Mobile App Launched in Q3FY20 with features enabling ease of access
Mobile App Launched in Q3FY20 with features enabling ease of access Expert TruHealth Risk Assessment TruHRA Customized Check-ups Booking Appointments See, Share & Store Fitness Tracker Reports Inner Health Tracking Medication Tracker Parameters Doctor’s, Hospital’s & Chat with Experts Metropolis nea
Slide 42: TruHealth App – Increasing Traction
TruHealth App – Increasing Traction App Review snapshots Total Installs: 01 Active Users 5,907 2,241 06 02 Leads Generated (Jan to Mar): 460 leads TruHealth App Total Stats Reviews: 68 05 03 Avg. Rating: 4.2 Stars Total Ratings by 4,206 Our Pilot Launch is successful with Positive reviews & Rating a
Slide 43: Future Strategy
Future Strategy 01 Increase Services 02 Increase Scale 43
Slide 44: Customer Centricity: In everything we do
Customer Centricity: In everything we do 01 02 03 04 Easy to Interpret Test Sample Collection from Conclusive Diagnosis Digital Access Report Doorstep We also have a policy of ensuring We have developed a Mobile Conclusive Diagnosis to our Application We offer our patients a Detailed We have increas
Slide 45: Sustainable Growth across Network
Sustainable Growth across Network Network of 210 Cities Criteria % of Revenue for FY20 Strategy ✓ Increasing productivity of Collection Centers ✓ Enhancing our Laboratory Capacity and Test Menu by adding Latest Machines and Technology ✓ High Potential Market Focus Cities ✓ Expanding B2C share of Bus
Slide 46: Focus on Profitable B2C Business
Focus on Profitable B2C Business Increase B2C sales mix Deeper Network Strengthen Productivity of Wellness initiatives Penetration Metropolis Brand existing young network for consumers Deeper centre penetration Expand Branded third- Increase number of referring Creating an easy and engaging in Focus
Slide 47: Growing Inorganically– A Win-Win Strategy
Growing Inorganically– A Win-Win Strategy Build Industry Best practices Introducing Standardized Machines and SOPs in a phased manner resulting in efficiency and quality enhancement Access to Metropolis Network Providing acquired entities access to Metropolis Sales and Marketing Network to improve t
Slide 48: Successful Track Record of Inorganic Strategy: 22 Acquisitions in 15 years
Successful Track Record of Inorganic Strategy : 22 Acquisitions in 15 years Revenue at the time of Few of the Acquired Companies Year of Acquisition Location Revenue for FY20 acquisition Sudharma Metropolis Health Services 2003 Kerala Rs. 1.8 Crores Rs. 49.6 Crores Private Limited Golwilkar Metropol
Slide 49: Plenty of Opportunities for Growth…
Plenty of Opportunities for Growth… Growing our offering of Test Packages to Increase Revenue Test Packages Metrics. Customized packages to Institutional Customers Expansion and Personalized Packages to Individual Patients are key Leverage our vast capabilities in Molecular Diagnostics, Aggressive N
Slide 50: Historical Financial & Operational Performance
Historical Financial & Operational Performance
Slide 51: Pan India Presence…
Pan India Presence… Metropolis Service Network Metropolis Service FY19 FY20 Network Laboratories 119 125 Owned PSC’s 255 260 Third Party PSC’s 1,506 1,873 ARC’s 575 598 Total 2,455 2,731 On Consolidated Basis Maps not to scale. All data, information, and maps are provided "as is" without warranty or
Slide 52: …with Aggressive Network Expansion Strategy
…with Aggressive Network Expansion Strategy Laboratory Network Service Network ARC Third Party PSCs +8.6% 124 Owned PSCs 2,731 119 106 2,336 598 95 +58.9% 89 575 1,650 520 1,873 887 1,506 308 879 428 151 356 117 223 251 255 260 160 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Network Strategy H
Slide 53: Better than industry growth
Better than industry growth Revenue (In Rs. Crs.) Bolstering Growth in Wellness Segment Metropolis Wellness revenue contribution for +15.8% 856 Metropolis is 7.9% in FY20 760 644 545 475 This market is expected to grow at a CAGR of 20% over next 3 financial years (Frost & Sullivan) FY16 FY17 FY18 FY
Slide 54: Robust Operating & Financial Performance
Robust Operating & Financial Performance No. of Patient Visits (In Mn.) Revenue Per Patient (In Rs.) +5.5% Metropolis realization per +9.7% 10.0 854 856 test and sample is higher than 836 8.9 778 industry owing to:- 7.7 692 6.9 7.0 ✓ ~37% of specialised test FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 F
Slide 55: Well growing B2C Mix
Well growing B2C Mix Retail contribution in Focus Cities to Total Revenue 56% 52% 45% 48% 43% Primary Strategy of the Company is to increase the Retail share in focus cities to 65% FY16 FY17 FY18 FY19 FY20 Chart shows B2C contribution over the years in focus cities; Mumbai, Chennai, Bangalore, Surat
Slide 56: Financial Highlights
Financial Highlights Revenue (In Rs. Crs.) Reported EBITDA (In Rs. Crs.) ROCE (%) 856 232 +15.8% +15.6% 46.5% 760 206 43.6% 42.8% 644 173 38.3% 40.0% 545 155 475 130 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 EBITDA (%) Reported PAT (In Rs. Crs.) ROE (%) +11.7% 27.3%
Slide 57: Profit & Loss Statement
Profit & Loss Statement Profit & Loss (Rs. Crs.) FY20 FY19 FY18 FY17 FY16 Revenue from Operations 855.5 760.1 643.6 544.7 475.5 Cost of Material Consumed 204.1 173.5 145.9 135.1 124.6 Laboratory testing charges 6.9 5.6 5.7 2.5 3.1 Total Raw Material 211.0 179.1 151.6 137.6 127.7 Gross Profit 644.5 5
Slide 58: Balance Sheet
Balance Sheet Assets (Rs. Crs.) Mar-20 Mar-19 Mar-18 Mar-17 Mar-16 Equity & Liabilities (Rs. Crs.) Mar-20 Mar-19 Mar-18 Mar-17 Mar-16 Non-current assets 355.2 247.9 230.1 230.1 170.6 Equity 525.2 420.0 429.1 344.1 293.9 Property, Plant and Equipment 121.2 116.7 112.3 105.2 105.6 Equity Share capital
Slide 59: Board of Directors and Management Team
Board of Directors and Management Team
Slide 60: Board of Directors
Board of Directors Dr. Sushil Kanubhai Shah Ameera Sushil Shah Chairman & Executive Director Managing Director Holds a bachelor’s degree in Medicine and Surgery Holds a bachelor’s degree in Business Administration and a degree of Doctor of Medicine in Pathology from the University of Texas and also
Slide 61: Management Team
Management Team Vijender Singh Dr. Nilesh Shah Chief Executive Officer President and Chief of Science & Innovation Holds a bachelor’s degree in Science from Kurukshetra Holds a master’s degree in Engineering from University of University and completed an Executive Education Mumbai and a Diploma in M
Slide 62: Recent Awards and Accolades
Recent Awards and Accolades Period Particulars Our MD, Ms. Ameera Shah won the Leader of the Year: NextGen award at the CNBC-AWAAZ February 2020 CEO Award organized by CNBC Awaaz held at Raipur Metropolis won the Most Admired Healthcare Company of the Year and our CEO, Mr. February 2020 Vijender Sin
Slide 63: For further information, please contact
For further information, please contact: Company : Investor Relations Advisors : Metropolis Healthcare Ltd. Strategic Growth Advisors Pvt. Ltd. CIN – U73100MH2000PLC192798 CIN - U74140MH2010PTC204285 Mr. Rakesh Agarwal - CFO Mr. Shogun Jain / Mr. Sagar Shroff Email Id – rakesh.agarwal@metropolisindi
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