Medical Facilities Corporation · TSX:DR
Medical Facilities — Investor Presentation (November 2017)
18 slides from Medical Facilities's investor presentation, November 2017
Slide 1: Investor Presentation November 2017
Optimized. Enhanced. INVESTOR PRESENTATION NOVEMBER 2017 TSX: DR
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements within the meaning of certain securities laws, including the “safe harbour” provisions of the Securities Act (Ontario) and other provincial securities law in Canada. These forward-looking statements include, among ot
Slide 3: MFC: A Quality Healthcare Provider Well-Positioned for Growth
MFC: A Quality Healthcare Provider Well-Positioned for Growth Majority ownership in five specialty surgical hospitals and one ambulatory surgery center • Specialty Surgical Hospitals: 48 operating rooms and 156 overnight rooms • Ambulatory Surgery Center: 2 operating rooms 2016 Revenue: US$339.5
Slide 4: MFC Specialty Surgical Hospitals
MFC Specialty Surgical Hospitals Our physician owned hospitals benefit from direct physician involvement in facility management resulting in 2 SUPERIOR PROCESSES AND EFFICIENCIES 1 1 Specialty surgical hospitals have consistently demonstrated 1 1 HIGHER PATIENT SATISFACTION ratings resulting from HI
Slide 5: Payor Mix
Payor Mix 2016 MFC Facility Service Revenue 2016 U.S. Healthcare System 8% 10% 41% 37% 55% 49% Private Insurance Government Other Private Insurance Government Other Source: Statista 2017 5
Slide 6: The U.S. Healthcare Landscape
The U.S. Healthcare Landscape Facility type Number* Services MFC’s position Acute Care Hospital Approx. 5,500 General medicine and surgery, including emergency and maternity care, open 24/7 Specialty Surgical <300 physician-owned Selected elective Owns 5 in conjunction with Hospital procedures (e.g.
Slide 7: Growing Demand for Healthcare
Growing Demand for Healthcare (millions) (US$ billion) 400 5,000 DRIVERS: National Health Expenditure 4,000 300 Overall population growth Population 3,000 Aging population 200 2,000 100 1,000 0 0 2010 2015E 2020E Under 45 years 45 to 64 years 65 years and over National Health Expenditure (US$ bi
Slide 8: Strict Acquisition Criteria
Strict Acquisition Criteria Accretion, with growth available from a local strong provider base, attractive demographics, and opportunities for operating enhancements High quality and optimum clinical outcomes Continued strong earnings and opportunity for growth Controlling position by MFC 8
Slide 9: Recent Acquisitions
Recent Acquisitions Unity Medical and Surgical Hospital • Locally and nationally recognized specialty hospital for patient care and satisfaction • Focus on orthopedic, ophthalmology, podiatry, pain management and spine surgery • 62% ownership acquired for US$26.63 million Prairie States Surgical
Slide 10: Financial Review
Financial Review 10
Slide 11: Factors Driving Our Results
Factors Driving Our Results Revenues Operating Margins Case Counts Level Salaries & Benefits Case Mix of Revenue Drugs & Supplies (incl. implants) Payor Mix General & Administrative Ancillary Services 11
Slide 12: Operating Results – Q3 2017
Operating Results – Q3 20171 (US$ millions, except where noted Q3 2017 Q3 2016 Change % YTD2 2016 otherwise) REVENUE 89.0 78.8 12.9% 274.1 339.5 INCOME FROM 12.4 14.2 (12.3%) 41.9 68.1 OPERATIONS OPERATING MARGIN 14.0% 18.0% (22.2%) 15.3% 20.1% EBITDA 19.3 19.6 (1.4%) 62.6 90.7 CASH DISTRIBUTIONS 8.
Slide 13: Well-Resourced for Growth
Well-Resourced for Growth Cash and cash equivalents: $52.1 million Current ratio: 2.4x Net Debt/Equity: 48.8% Debt/EBITDA (LTM): 1.6x 13
Slide 14: Strong Cash Flow
Strong Cash Flow1 Distributions Cash Available for Distribution Cash Available for Distribution (including realized gains/losses on FX forward contracts)2 (Excluding realized gains/losses on FX forward contracts) (C$ millions) 51.9 50.7 50.7 45.9 43.3 69.0 % 40.8 40.8 41.4 37.8 35.7 34.4 35.3 35.2 3
Slide 15: Investment Highlights
Investment Highlights • Long-term track record of delivering stable returns to shareholders • Highly rated, high quality facilities with strong organic growth opportunities • Favorable industry consolidation trends • Resources in place to execute on growth strategy • Experienced, entrepreneurial man
Slide 16: Management
Management Robert O. Horrar President and Chief Executive Officer Formerly: Community Health Systems, Humana Tyler C. Murphy Chief Financial Officer Formerly: Tenet Healthcare, HealthSouth James D. Rolfe Chief Development Officer Formerly: VMG Health, Community Health Systems 16
Slide 17: Board of Directors
Board of Directors Marilynne Day-Linton, CPA, CA David R. Bellaire Chair of the Board of Directors Operating Partner, Waud Capital Partners Stephen Dineley, FCPA, FCA Irving R. Gerstein, C.M., O.Ont Corporate Director Corporate Director Robert O. Horrar Dale Lawr, CPA, CA President and Chief Executi
Slide 18: Capital Markets Profile (as at November 10, 2017)
Capital Markets Profile* (as at November 10, 2017) Stock Symbol: TSX: DR Shares Outstanding: 31.0 million Price: $13.28 52‐Week Low / High: $11.14/$19.90 Market Capitalization: $391.8 million Annualized Distribution (per share): $1.125 Current Yield: 8.5% Payout Ratio (TTM):** 69.0% *All figures in
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