Paragon Care Limited · ASX:PGC
Paragon Care — H1 2023 Earnings Presentation
24 slides from Paragon Care's earnings presentation, Feb 22, 2023
Slide 1: 1H FY23 Results
1H FY23 Results INVESTOR PRESENTATION 22 February 2023 ASX : PGC
Slide 2: Disclaimer
Disclaimer Summary information This Presentation contains summary information about Paragon Care and its activities current as at 21/02/2023. The information in the Presentation is of a general nature and does not purport to be complete or comprise all information which a shareholder or potential in
Slide 3: Overview
Mark Hooper Group CEO & Managing Director Overview 3 1H FY23 Results
Slide 4: 1H FY23 result in line with expectations
1H FY23 result in line with expectations • Revenue of $154m vs $111m 1H FY22 • Underlying EBITDA* of 38% • Mainly reflects the inclusion 37% $17.6m vs $12.8m 1H FY22 of Quantum and SMS • Margins largely maintained Sales revenue Underlying • Remaining business relatively EBITDA* despite higher capita
Slide 5: Positive progress continues
Positive progress continues TARGET PROGRESS TO DATE Earnings Underlying EBITDA growth of ✓ Remains on track with second half earnings expected to mirror the same 30% for FY23 market / operating conditions as H1 ✓ Quantum business performing strongly Leverage Quantum skills / ✓ Progress on ophthalmic
Slide 6: Investing to support growth – new Mount Waverley facility
Investing to support growth – new Mount Waverley facility • State of the art purpose built facility originally commissioned to support an uplift in manufacturing capacity and the Immulab business expansion into Asia / other export markets • Original scope was then expanded beyond Immulab to facilita
Slide 7: Financial Results
Josephine De Martino Group Chief Financial Officer Financial Results 7 1H FY23 Results
Slide 8: 1H FY23 Profit and Loss
1H FY23 Profit and Loss 1H FY23 1H FY22 CHANGE Key highlights $m $m $m % Revenue 153.9 111.3 42.6 38% • Underlying EBITDA* increased by 37% in Cost of sales 90.5 64.5 26.0 40% 1H FY23 mainly reflecting the inclusion of Gross margin 63.3 46.7 16.6 36% Quantum results from February 2022 and SMS in Sep
Slide 9: 1H FY23 results: trends from the first quarter continue
1H FY23 results: trends from the first quarter continue Underlying • Gradual improvement in elective surgery although still variable across states / months Revenue* EBITDA** ROIC *** • Hospital nursing capacity in rebuilding phase in a post COVID environment • Demand for pain management devices bein
Slide 10: 1H FY23 Cash Flow
1H FY23 Cash Flow Key highlights • Net Debt* of $69.6m largely in line with 1H FY22 however this is a $19.5m increase over June 2022. • Mainly reflects the cash portion of the SMS acquisition ($11.8m) and higher working capital. • Key working capital movements from FY22 include: – Inventories – $10.
Slide 11: Key working capital movements
Key working capital movements 1H FY23 1H FY22 CHANGE $m $m $m % Net cash from operating activities 1.2 3.9 -2.7 -69% In 1H FY23 cashflow from operations decreased slightly to $1.2m from 1H FY22 $3.9m. This mainly reflects movements in working capital including timing differences. • Inventory increas
Slide 12: Capital management
Capital management Key highlights Dividend – Key Dates Dividends • 1H FY23 interim dividend declared of 0.6cps, fully franked Release date 22 February 2023 • This represents a 63% payout ratio of Underlying NPAT* Ex-dividend date 14 March 2023 • The PGC Board continues to target a dividend payout ra
Slide 13: Strategy and Growth
Mark Hooper Group CEO & Managing Director Strategy and Growth 13 1H FY23 Results
Slide 14: Strategy – 'the Light on the Hill'
Strategy – ‘the Light on the Hill’ • • • • 14 1H FY23 Results
Slide 15: A more comprehensive network across AsiaPac
A more comprehensive network across AsiaPac • Paragon Care already has a strong network across ANZ markets • The merger with Quantum provides a presence in Thailand, Korea, Philippines, China, Vietnam and New Zealand • Target markets beyond this include Japan, Indonesia and Singapore • It also provi
Slide 16: PGC has a range of organic growth prospects
PGC has a range of organic growth prospects • Return to elective surgery still being • A strong market position in Australia • Core growth should be circa 5%-10% • Staged integration that builds off the impacted by hospital delays / theatre with modest medium term growth per annum but varies from ye
Slide 17: Also targeting three additional growth areas
Also targeting three additional growth areas Immulab export opportunities • Significant export opportunities in blood diagnostic export markets – good progress here but this will not materially impact earnings until FY25 • Also exploiting opportunities for manufacture into offshore markets including
Slide 18: A positive growth outlook remains
A positive growth outlook remains • Underlying EBITDA still expected to increase by around 30% driven by the full year impact of Quantum and SMS and organic growth of around 5%-10% • 2H FY23 expected to mirror the same market / operating trends as 1H FY23 • Still targeting EBITDA of $100m by FY27 th
Slide 19: Empowering Healthcare
Empowering Healthcare ParagenCare
Slide 20: Appendices
Appendices 20 1H FY23 Results
Slide 21: Appendix 1 | Paragon Care Group overview
Appendix 1 | Paragon Care Group overview Paragon Care (PGC) • Australian based / established in 2008 • Mainly focused on sale of medical equipment and devices along with related consumables and maintenance support • Long term relationships with >100 manufacturers globally • Unique end to end capabil
Slide 22: Appendix 2 | A pillar based view of earnings (pre Corporate costs)
Appendix 2 | A pillar based view of earnings (pre Corporate costs) Capital and Service and Devices Diagnostics Consumables# Technology*# • Ophthalmology & Optometry • Blood Bank Diagnostics • Broad presence across Australia • Comprehensive offering from • Orthopaedics Manufacturer / NZ / Asia (via Q
Slide 23: Appendix 3 | Reconciliation from Reported to Underlying Results
Appendix 3 | Reconciliation from Reported to Underlying Results 1H FY23 1H FY22 CHANGE 1H FY23 1H FY22 CHANGE $m $m % $m $m % Reported NPAT 6.7 5.4 24% Reported E BITDA 18.1 14.1 28% Ba sic E PS: (cps) 0.83 1.56 -47 % Normalisations Diluted E PS: (cps) 0.81 1.52 -47 % Fair value gain - Interest rate
Slide 24: Appendix 4 | 1H FY23 Balance Sheet movements
Appendix 4 | 1H FY23 Balance Sheet movements 1H FY23 FY22 CHANGE Commentary $m $m $m % • Net Debt* (Borrowings less Cash and Cash Equivalents) 26.7 46.2 -19.5 -42.3% largely in line with December 2021 however a $19.5m 47.3 42.9 4.4 10.3% increase over June 2022. 61.9 51.5 10.5 20.4% Mainly reflects