Slide 1: Integral Diagnostics FY19 Half Year Results
Integral Diagnostics Providing Excellence in Diagnostic Imaging in Australia and New Zealand I FY19 Half Year Results Dr. Ian Kadish (MD & CEO) Anne Lockwood (CFO) 21 February 2019 “Good Medicine is Good Business”
Slide 2: Today’s presenters
Today’s presenters Dr. Ian Kadish Anne Lockwood Managing Director and Chief Executive Officer Chief Financial Officer • Joined Integral Diagnostics in May 2017 • Joined Integral Diagnostics in 2016 and appointed as Chief Financial Officer in September 2017 • Has held roles including CSC Healthcare,
Slide 3: 1H19 Highlights
1H19 Highlights • Delivered solid growth vs 1H18 34.4% growth in operating NPAT 40.5% growth in operating EBITDA 25.6% growth in operating EPS 23.2% growth in operating revenue 28.9% growth in Statutory NPAT • Successful integration of significant acquisitions across New Zealand and Geelon
Slide 4: 1H19 Highlights continued
1H19 Highlights continued • Expanded operations Completed development at SJOG Hospital in Geelong Opened Miami Beach clinic on the Gold Coast Commenced building the Prostate Imaging Centre of Excellence at the Australian Prostate Centre in North Melbourne Assessing selected acquisitions that
Slide 5: 1H19 Financial performance
1. 1H19 Financial performance Confidential / Draft 4
Slide 6: Delivered growth across all key financial metrics
Delivered growth across all key financial metrics Operating 1H19 results delivered strong organic performance and successfully integrated acquisitions $ millions 1H19 1H18 Change ($) Change (%) Operating revenue(1) 114.3 92.8 21.5 23.2% Operating EBITDA (2) 26.7 19.0 7.7 40.5% EBITDA from operations
Slide 7: Reconciliation of operating to statutory profit
Reconciliation of operating to statutory profit $ millions 1H19 1H18 Change ($) Change (%) Operating NPAT 12.9 9.6 3.3 34.4% One off transactions and other costs net of tax Transaction and other costs (0.7) (0.9) Customer contract amortisation (1.5) (0.4) Statutory NPAT 10.7 8.3 2.4 28.9% • Other co
Slide 8: 1H19 Revenue
1H19 Revenue Solid 1H19 growth driven by leveraging IDX’s platform, integrating acquisitions and 1H19 one-offs Operating revenue up 23.2% to $114.3m • Organic revenue growth of 8.0% and volume growth of 7.0% (1), growth delivered across all business units • New Zealand contributed 13.1% of revenue g
Slide 9: 1H19 Operating Expenditure
1H19 Operating Expenditure Leveraging the expanded platform and successfully integrating acquisitions Industry leading margins across Australia and New Zealand Expenses declined as a % of revenue across all categories • Cost efficiency program largely completed • Cost management will continue to be
Slide 10: Capital Management
Capital Management Strong balance sheet with increasing net assets to support growth and acquisitions • 1H19 net debt of $116.8m (1H18: $ millions 31 Dec 18 30 Jun 18 31 Dec 17 $42.3m) Cash and cash equivalents 24.2 20.8 25.4 2.2x trailing EBITDA prior to Trade and other receivables 8.4 5.6 4.9 on
Slide 11: Cashflow and cash conversion
Cashflow and cash conversion Strong business performance and cash conversion reflected in free cash flow growth $ millions 1H19 1H18 • Normalised free cash flow conversion of 89.5% (1H18 93%) – 105.6% net of replacement capex Operating EBITDA 26.7 19.0 Non-cash items in EBITDA 0.1 0.2 • Replacement
Slide 12: Capital expenditure
Capital expenditure Increase in capex commensurate with increased size of the business and investment for future growth $ millions(1) 1H19 1H18 FY19 Est FY18 Replacement 4.3 2.3 12.0 8.8 Growth 1.6 1.3 8.0 5.2 Total 5.9 3.6 20.0 14.0 • FY19 expected capex of around $20m Replacement capex of around
Slide 13: Market update
2. Market update Confidential / Draft 12
Slide 14: Industry growth rates stabilised and strong long-term drivers remain
Industry growth rates stabilised and strong long-term drivers remain Industry growth recovering 12 month rolling growth rate by services 12 month rolling growth rate by benefits 14% -- Average 5.6% --Average 7.3% 12% 10% 8% 6% 4% 2% 0% 1: Medicare Australia Statistics Medicare by Broad Type of Servi
Slide 15: Regulatory environment active with forthcoming election
Regulatory environment active with forthcoming election Australia: July 1, 2018 • Introduction on the Medicare Benefits Schedule (MBS) of MRI Prostate items – strongly positive for patients and referrers and good contributor to IDX growth in 1H19 which we expect to continue MRI prostate provides n
Slide 16: Regulatory environment active with forthcoming election continued
Regulatory environment active with forthcoming election continued Australia cont.: Future Expected Changes • Reintroduction of MBS indexation for selected Diagnostic Imaging (DI) services from July 2020 – estimated to add approx. $500-$800k of revenue to IDX in FY21 • Full MBS indexation for all DI
Slide 17: Strategy
3. Strategy Confidential / Draft 16
Slide 18: IDX now operates in four key markets
IDX now operates in four key markets Total IDX Geographic Market Victoria Queensland Western Australia New Zealand Ballarat, Geelong, Gold Coast, Warrnambool and South West Western Core markets Toowoomba and Auckland outer western areas Australia Mackay of Melbourne Sites (includes hospital 27 13 9
Slide 19: Management’s FY19 strategy – good medicine is good business
Management’s FY19 strategy – good medicine is good business Strategy 1 Grow existing business and margin 2 Strategic acquisitions Drive organic Drivers of growth & Optimise Develop strategy efficiency Medical Further disciplined execution technology Centres of by leveraging leadership of strategic a
Slide 20: 2H19 Key priorities, focus and outlook
2H19 Key priorities, focus and outlook 2H19 Key priorities, focus and outlook • Monitor and assess impact of new MRI licence allocations as well as removal of GP referred knee MRI for over 50’s • Replace 2 CT’s in WA with high end machines to meet demand and improve workflow and image quality Drive
Slide 21: 2H19 Key priorities, focus and outlook continued
2H19 Key priorities, focus and outlook continued 2H19 Key priorities, focus and outlook continued Implement new • Broadening of the radiologist shareholder base radiologist Shares to be issued from over subscribed FY19 Radiologist share plan, FY20 issue under the plan recruitment, retention to be
Slide 22: Questions?
Questions? integral A dacnostics
Slide 23: Disclaimer
Disclaimer Some of the information contained in this presentation contains “forward-looking statements” which may not directly or exclusively relate to historical facts. These forward-looking statements reflect Integral Diagnostics Limited (IDX) current intentions, plans, expectations, assumptions a
Slide 24: Contact us
Contact us Investors & Media Dr Ian Kadish, CEO P: +61 3 5339 0704 E: ikadish@idxgroup.com.au