Emeis · EURONEXT:EMEIS
Emeis — Orpea — H1 2020 Earnings Presentation
42 slides from Emeis's earnings presentation, Sep 22, 2020
Slide 1: 2020 Half-Year results
2020 Half-Year results 22 September 2020
Slide 2: Agenda
Agenda 1. Management of Covid-19 2. Network and development 3. 2020 Half-Year results 4. Acquisition of Brindley group in Ireland 5. Strategy and outlook Appendix 2
Slide 3: Comprehensive offering of mid-term and long-term care for physical and mental conditions
Comprehensive offering of mid-term and long-term care for physical and mental conditions Core businesses ORPEA dependency care offering Complementary businesses POST-ACUTE AND MEDICALISED PSYCHIATRIC NURSING HOMES HOSPITALS ASSISTED LIVING FACILITIES HOMECARE AND HOME SERVICES Alzheimer units Sp
Slide 4: Management of Covid-19
Salzburg, Austria Management of Covid-19
Slide 5: Management of COVID-19 combining extreme vigilance and social life
Management of COVID-19 combining extreme vigilance and social life KEEPING BARRIER On all of the Group's sites, robust barrier measures are being kept in place: mask wearing (staff and visitors), systematic temperature measurements, physical distancing, reinforced hygiene measures, training in sym
Slide 6: A local approach with three procedural levels
A local approach with three procedural levels 3 procedural levels according to local epidemic indicators and gradual responses on a facility-by-facility basis Coro 1 Coro 2 Coro 3 Facility located in a department Facility located in an epidemic zone Facility with at least one confirmed c
Slide 7: Recent trend of COVID-19 and main indicators (15.09.20)
Recent trend of COVID-19 and main indicators (15.09.20) Observation: slight rise in positive cases (France and Spain) but more than 90% are asymptomatic Number of COVID+ patients/residents Number of COVID+ employees 4 500 4 000 1 600 3 500 1 400 3 000 1 200 2 500 1 000 2 000 800 1 500 600 1 000 400
Slide 8: Analysis of COVID-19 crisis management using family/employee satisfaction surveys
Analysis of COVID-19 crisis management using family/employee satisfaction surveys as early as June Launched in June 2020 to get feedback from families and residents and to adjust problem areas Crisis management Survey conducted digitally by an independent body: more than 37,000 questionnaires se
Slide 9: Activity recovery since the beginning of H2 2020
Activity recovery since the beginning of H2 2020 Post-acute and rehabilitation hospitals Nursing homes Psychiatric hospitals Occupancy rates already close to pre-Covid-19 Occupancy rates expected to be close to pre- levels Covid-19 levels in most countries within 6 months (providing pandemic do not
Slide 10: Network and development
Honfleur, France Network and development
Slide 11: Major acquisitions in 2020
Major acquisitions in 2020 (50%) (50%) Nursing home Nursing home Psychiatry France Psychiatry France Ireland Ireland 7 facilities 9 facilities 5 facilities 10 facilities 592 beds 907 beds 674 beds 574 beds A total potential of 2,747 beds, representing €220m in revenue at maturity 11
Slide 12: Strengthening in mental health in France: acquisition of Clinipsy
Strengthening in mental health in France: acquisition of Clinipsy Founded in 2009 by two Doctors and already a key player in mental healthcare in France Acquisition of 9 facilities (907 beds) of which 50% opened recently or to be opened in the next 2 years 2019 revenue of €40 million Locatio
Slide 13: Acquisition with high potential
Acquisition with high potential MARKET COMPLEMENTARITIES GROWTH Attractiveness of the Numerous complementarities Potential for revenue growth psychiatry market: with the ORPEA offer: and improved profitability: – Scarcity of the offer – Geographic: extension of the – Significant growth network
Slide 14: A global Group: 22 countries; 1,028 facilities; 105,443 beds
A global Group: 22 countries; 1,028 facilities; 105,443 beds EUROPEAN NETWORK NETWORK OUTSIDE EUROPE France Benelux 523 fac. 46,277 beds Central Europe 249 fac. 26,491 beds Mexico Eastern Europe 136 fac. 14,621 beds Iberia + Latam 119 fac. 17,914 beds Other countries 1 fac. 140 beds Colombia LATAM B
Slide 15: A secured pipeline of 21,137 beds
A secured pipeline of 21,137 beds Pipeline in % of Opened beds Pipeline opened beds France Benelux 41,320 4,957 12% France 32,170 3,101 10% Belgium 6,970 449 6% Luxembourg - 365 Ireland 961 - 0% Netherlands 1,219 1,042 85% Central Europe 21,606 4,885 23% Germany 16,654 2,929 18% Switzerland 2,952 72
Slide 16: 2020 Half-Year Results
Rio de Janeiro, Brazil 2020 Half-Year Results
Slide 17: Resilient and dynamic activity since the beginning of 2020
Resilient and dynamic activity since the beginning of 2020 Increase in Revenue: €1,904m | +3.5% revenue Solid and resilient EBITDAR margin: 23.8% (-2.3 pts) profitability Strengthened financial Cash: €902m capacity SSD + Euro PP: €344m New real-estate Real-estate: €6.25bn (+€233m) arbitrage July dis
Slide 18: H1 2020 revenue strongly resilient: +3.5% at €1,904m
H1 2020 revenue strongly resilient: +3.5% at €1,904m €m H1 2020 H1 2019 Chg. Organiquc growth*: -0.9% – Impact of Covid-19 pandemic France / Benelux 1,136.60 1,093.20 4.00% – Activity in health facilities strongly impacted: Centrale Europe 499.60 473.90 5.40% closure of clinics in Austria, sudden
Slide 19: Covid-19 impact on EBITDAR margin
Covid-19 impact on EBITDAR margin Impact on EBITDAR (€m) Gross impact Compensation Net impact Reduced activity -67 +41 -26 Additional PPE costs -22 +15 -7 Additional staff costs -58 +38 -20 TOTAL -147 +94 -53 -140 bps -40 bps - 100 bps 26.1% 23.8% H1 2019 H1 2020 ex. Covid Reduced activity Additiona
Slide 20: EBITDAR by cluster
EBITDAR* by cluster H1 2020 H1 2019 In €m Revenue EBITDAR* %revenue Revenue EBITDAR* %Rev. France / Benelux 1136.6 306.5 27.0% 1093.2 310.8 28.4% Central Europe 499.6 119.5 23.9% 473.9 115.7 24.4% Eastern Europe 170.0 18.1 10.7% 175.7 29.6 16.8% Iberian Peninsula + LATAM 96.4 9.8 10.1% 96.5 24.4 25.
Slide 21: Solid and resilient EBITDA margin at 23.1%
Solid and resilient EBITDA margin at 23.1% Restated from IFRS 16 In €m H1 2020 H1 2019 Chg. H1 2020 H1 2019 Revenue 1904.2 1840.6 +3.5% 1,904.2 1,840.6 Staff costs -1080.0 -986.5 +9.5% -1080.0 -986.5 Procurement -342.7 -323.7 +5.9% -342.7 -323.7 Taxes and duties -72.3 -61.7 +17.2% -72.3 -61.7 Other
Slide 22: Net profit, Group share: €73m
Net profit, Group share: €73m Restated from IFRS 16 In €m H1 2020 H1 2019 Chg. H1 2020 H1 2019 Recurring EBITDA* 439.0 464.5 -5.5% 283.9 317.6 Depreciation, amortisation and provisions -242.3 -220.4 +9.9% -112.6 -98.8 Recurring operating profit 196.8 244.1 -19.4% 171.3 218.8 Net financial costs -113
Slide 23: Cash flow statement
Cash flow statement In €m H1 2020 H1 2019 Net cash from operating activities 245 244 Investments in construction projects -168 -206 Acquisition of real-estate -194 -174 Disposals of real-estate 1 0 Net real-estate investments -361 -380 Net investments in operating assets and equity investments -293
Slide 24: Solid financial structure
Solid financial structure Simplified balance sheet1 at 30.06.20 (in €m) and change over H1 2020 Intangibles: Not 1,338 allocated 3,009 Equity and quasi equity: +250 €4,018m * Equity €3,570m +57 Allocated 2,680 561 Indefinitely deferred taxes 5,958 Net financial debt +423 +233 Real estate 6,250 Other
Slide 25: Long-term financial debt at attractive rate
Long-term financial debt at attractive rate 30.06.20 Covenants comfortably met Indicators 30.06.20 31.12.19 restated IFRS 16 Restated financial Maximum Net financial debt* (€m) 5,958 5,958 5,535 leverage1 authorized 5.5 % Real-estate debt 87% 87% 85% Restated financial leverage1 1.4 2.8 2.3 2.8 Rest
Slide 26: Further diversification and debt optimisation
Despite these challenging times, further diversification and debt optimisation €120 million 7 to 12-year Euro PP issue – Very attractive conditions Diversified net financial debt – Debt maturity extended 16% €224 million Schuldschein since early 2020 – 15-year €40 million NSV issue 22% – €184 mi
Slide 27: Real-estate portfolio: €6.25bn (+€233m in 6 months)
Real-estate portfolio: €6.25bn (+€233m in 6 months)1 Real-estate portfolio (€m) and ownership rate 49% 7 000 50% 30.06.20 31.12.19 Chg. 6,250 6 000 50% Real-estate ownership rate 49% 49% = 5 000 32% 40% 4 000 Surface (in million sqm) 2.2 2.1 +4.0% 3 000 2,217 30% 2 000 Total value1 (€m) 6,250 6,017
Slide 28: Example of selective acquisitions and real-estate divestments
Example of selective acquisitions REAL-ESTATE DIVESTMENTS Healthcare real-estate Strategic objective 2020 divestments Growing interest in healthcare real- Mid- and long-term strategic 2020 divestments: estate due to the resilience of objective: 50% of real estate owned – €145 million to Icade
Slide 29: Acquisition of Brindley group in Ireland
Ireland Acquisition of Brindley group in Ireland
Slide 30: Strong foundations for the nursing home market in Ireland
Strong foundations for the nursing home market in Ireland POPULATION CURRENT OFFERING GROWING DEMAND Life expectancy: 81.5 years 30,757 nursing homes, of which 69% privately Strong future growth in demand: owned, with 55 beds per home on average 10,000+ beds will be needed by 2031 Expected c
Slide 31: Strengthened presence in Ireland with the acquisition of 50% of Brindley Healthcare
Strengthened presence in Ireland with the acquisition of 50% of Brindley Healthcare Ireland’s 4th largest nursing home operator, founded in 2000 Complementary geographical presence to that of TLC with 10 facilities (574 beds) in 6 counties A Homecare activity Close to €25 million in revenue
Slide 32: ORPEA: Second-largest player in Ireland
ORPEA: Second–largest player in Ireland National coverage: 15 nursing homes (1,248 beds) of recognised quality 139 beds Donegal 57 beds 674 beds Mayo Dublin 41 beds Galway Kildare Laois 204 beds 81 beds 52 beds Brindley facilities TLC facilities 32
Slide 33: Rationale for the TLC/Brindley combination
Rationale for the TLC/Brindley combination Optimisation of prices: TLC management’s experience in negotiating prices Pooling of Brindley management’s experience and success in acquisitions expertise The possibility of replicating Brindley’s Alzheimer’s offer in TLC’s facilities Cost synergie
Slide 34: Strategy and outlook
Montevideo, Uruguay Strategy and outlook
Slide 35: A global strategy focused on value-creation and Corporate Social Responsibility
A global strategy focused on value-creation and Corporate Social Responsibility PREMIUMISATION INTERNATIONAL BALANCED RESPONSIBLE AND ENGAGED OF THE OFFER AND DEVELOPMENT OWNERSHIP / LEASE COMPANY NETWORK REAL-ESTATE STRATEGY Creation of new facilities in high Acquisitions and creations in all
Slide 36: Appendix
Suresnes, France Appendix
Slide 37: Long-term shareholders, dedicated to value creation
Long-term shareholders, dedicated to value creation Shareholding structure (% of share capital) Board Board members: – Philippe Charrier – Non-executive chairman – Yves Le Masne – CEO CPPIB – Jean Patrick Fortlacroix Free float 14.5% – FFP Invest (Thierry Mabille de Poncheville) 80.5% – Xavier Coi
Slide 38: Balance sheet
Balance sheet In €m 30.06.2020 31.12.2019 Non-current assets 13,031 12,440 Goodwill 1,338 1,299 Intangible assets 2,680 2,469 PPE and property under development 6,250 6,017 ASSETS Right of use assets 2,387 2,334 Other non-current assets 377 321 Current assets 1,845 1,699 Of which cash, cash equivale
Slide 39: Profit and loss statement
Profit and loss statement H1 2020 In €m restated IFRS IFRS 16 adj. H1 2020 16 Revenue 1904 0 1904 Staff costs -1080 0 -1080 Procurement costs -343 0 -343 Taxes and duties -72 0 -72 Other income and expenses 44 0 44 EBITDAR 453 0 453 23.8% 23.8% Rental expenses -169 155 -14 EBITDA* (recurring) 284 15
Slide 40: Glossary
Glossary Organic growth reflects the following factors: 1. The year-on-year change in the revenue of existing facilities as a result of changes in their occupancy rates and per diem rates Organic growth 2. The year-on-year change in the revenue of redeveloped facilities or those where capacity has b
Slide 41: Pipeline and beds by cluster
Pipeline and beds by cluster % Nb. Nb. Total of Beds % of Pipeline by cluster countries facil. Nb. beds total opened Pipeline total 8 000 7 648 France Benelux 5 523 46,277 44% 41,320 4,957 23% Central Europe 3 249 26,491 25% 21,606 4,885 23% 6 000 4 957 4 885 4 000 3 647 Eastern Europe 6 136 14,621
Slide 42: Market data
Market data Market data (12 months) Indices Average trading volume: 267,000 shares per day (=€28m) all platforms combined Compartment A of Euronext Paris Share price: €98.66 Component of the MSCI Small Cap Europe, STOXX Europe 600, CAC Mid 60 and SBF 120 indices 12-month high: €128.50 Me