Veradigm Inc. · OTC:MDRX
Veradigm — Allscripts Healthcare Solutions — Investor Presentation (May 2012)
48 slides from Veradigm's investor presentation, May 8, 2012
Slide 1: Allscripts Investor Presentation May 2012
Allscripts Investor Presentation May 2012 Exhibit 99.1
Slide 2: Forward-Looking Statement
Forward-Looking Statement This presentation contains forward-looking statements within the meaning of the federal securities laws that involve risks and uncertainties. We develop forward-looking statements by combining currently available information with our beliefs and assumptions. These statement
Slide 3: Connected Community of Health: Our Vision
Connected Community of Health ™ OUR VISION Allscripts is a leading provider of Electronic Health Record, practice management and other clinical, revenue cycle, connectivity and information solutions for physicians, hospitals & post-acute organizations
Slide 4: Allscripts: Who We Are
OUR CLIENTS • 180,000 Physicians • 50,000 Physician Practices • 1,500 Hospitals • 10,000 Post-acute Facilities • 27,000 Clinicians In Patients Homes Every Day OUR COMPANY • ~$1.444BB 2011 Revenue • 6,700 Employees • ~$190MM 2012 R&D 1 Run Rate • Leader in Innovation • 1 Complete Set of Solutions All
Slide 5: Investment Highlights
Investment Highlights MARKET LEADER • Diverse, industry-leading client base COMPLETE PRODUCT PORTFOLIO • Flexible, modern and complete solutions • Maximizes opportunities to expand market and wallet share DYNAMIC GROWTH MARKET • $30BB Federal stimulus program drives healthcare IT adoption • Low pene
Slide 6: Agenda
Agenda MARKET DIFFERENTIATION GROWTH
Slide 7: Market
MARKET DIFFERENTIATION GROWTH
Slide 8: Market: The Time is NOW
National Problem A Market that is Ready A Significant Opportunity • Quality Issues • Medical Errors / Safety Concerns • Rising Cost • Significant Waste • $43BB Opportunity • $30BB in Stimulus Funding • ~35% Penetration in Physician Practices • Rise in Employed Physicians • Hospitals Driving Adoption
Slide 9: Market: Unsustainable Trend Requiring Change
VALUE • Collaboration, connectivity • Clinical, financial data, analysis • Optimize outcomes • Accountable care Market: Unsustainable Trend Requiring Change VOLUME • Fragmented providers and payments • No uniform quality • Fees for volume • Demand increasing Source: HFMA “Value in Healthcare: Curren
Slide 10: Market: MDRX Addresses the Entire Market Opportunity
$16BB $10BB $17BB Market: MDRX Addresses the Entire Market Opportunity Acute/Ambulatory EHR Opportunity 2010-2014 = ~$43BB Source: McKinsey & Company $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 • Ambulatory Stand-Alone Opportunity • Acute Stand-Alone Opportunity STAND-ALONE MARKET INTEGRATED MARKET • Inte
Slide 11: Market: Significant Ambulatory Potential
PRACTICE SIZE TOTAL # OF PRACTICES EHR PENETRATION (July ‘11) Market: Significant Ambulatory Potential 1-3 Physicians ~186,000 ~30% 4-9 Physicians ~28,000 ~50% 10-25 Physicians ~6,900 ~70% 26+ Physicians ~1,750 ~85% Total 226,650 ~35% Source: SK&A Information Services
Slide 12: Market: Acute Care Growth Drivers
LEGACY REPLACEMENT CYCLE UNDER- UTILIZATION • Obsolete mainframe systems • Integrate acute/ambulatory systems • Care coordination • Only ~20%* of hospitals at HIMSS Stage 4 adoption or higher • Only 1%* at HIMSS Stage 7 HOSPITALS/HEALTH SYSTEMS Market: Acute Care Growth Drivers Source: HIMSS Analyti
Slide 13: Differentiation
MARKET DIFFERENTIATION GROWTH
Slide 14: Differentiation: Leading Footprint Across the Market
(48% Rev) 1 of 3 MDs 1 of 3 Hospitals (43% Rev) Differentiation: Leading Footprint Across the Market 10,000 Post-acute Care Providers (9% Rev) Source: Percentages determined based on GAAP revenues included in Allscripts’ Annual Report on Form 10-K for the year ended December 31, 2011.
Slide 15: Differentiation: Open and Connected Portfolio
Differentiation: Open and Connected Portfolio
Slide 16: Differentiation: The Challenge to Deliver Meaningful Care
Differentiation: The Challenge to Deliver Meaningful Care Stage 1: Application Stage 2: Connection Stage 3: Information Stage 4: Insights Stage 5: Outcomes TIME LEVEL OF IMPACT (Quality, Cost)
Slide 17: Differentiation: The New Architecture of Healthcare
Connect Inside Differentiation: The New Architecture of Healthcare Old World (Monolithic/Closed Mainframe) New World (Modern/Open Platform) Connect Inside and Outside
Slide 18: Differentiation: Allscripts Approach
• Key stakeholders across the community (Allscripts Referral Network, Allscripts Community) • All points of care and all applications within their organization Differentiation: Allscripts Approach
Slide 19: Differentiation: Clinical Outcomes Experience and Focus
“Clinical outcomes is the name of the game in ACOs. This is an area where we believe Allscripts holds a market lead, and needs to continue to focus on delivering more integrated outcomes modules for its client base.” THE ADVISORY BOARD COMPANY (APRIL 2011, “A PERSPECTIVE ON THE COMPANY”) Differentia
Slide 20: '® Allscripts
'® Allscripts
Slide 21: Differentiation: Innovative Solutions
Differentiation: Innovative Solutions Mobile Platforms Accelerate Adoption
Slide 22: Growth
MARKET DIFFERENTIATION GROWTH
Slide 23: Growth: Long-Term Focus
Growth: Long-Term Focus 1. Annual revenue for Allscripts illustrated above is based on a GAAP presentation and is calenderized based on quarterly results. Please note Allscripts changed its fiscal year-end to May between the period of September, 2008 and May, 2010. GAAP revenue also includes the imp
Slide 24: Growth: Historical Performance
Ambulatory 58%/ Acute 42% Ambulatory 48%/ Acute 52% $298 $250 • Non-GAAP Revenue CY 2010: $1,300MM Growth: Historical Performance Note: Please see the Non-GAAP reconciliation and related footnotes in the appendix to this presentation. tp ://investor.allscripts.com CY2010 CY2011 Non-GAAP Operating In
Slide 25: Growth: Distribution Outpaces the Competition
Growth: Distribution Outpaces the Competition ~170 Field sales reps Hospital Community Partners Payers ~75 Internal sales reps All Providers ~125 Value-added Resellers (>1,000 representatives)
Slide 26: Growth: Cost Synergy Opportunities
~$25MM ~$40MM Growth: Cost Synergy Opportunities Projected Cost Synergies Over Three Years • Duplicative management structure • Duplicative public company costs • Duplicative back-end office and system integration • Marketing CY2011 CY2012 CY2013 & Beyond ~$35MM Key Cost Synergy Drivers
Slide 27: Growth: Significant Client Sales Opportunity
INCREMENTAL REVENUES ~$430MM + ~$820MM = ~$1,250MM Growth: Significant Client Sales Opportunity Sell Acute Solutions to Ambulatory Care Base Sell Ambulatory Solutions to Acute Care Base
Slide 28: Business Update
Business Update • Q1 Results • Bookings $194.6MM • Three new Sunrise Clinical Manager sales • Non-GAAP revenue growth 6% • Non-GAAP operating profit margin 11.2% • Non-GAAP EPS $0.12 • Cash Flow From Operations $74.6MM • Factors Impacting Results • Lower Q1 sales • Unfavorable revenue mix • Investme
Slide 29: Four Point Plan
Product Delivery • $190MM 2012 gross R&D spend • New product releases • Innovation Client Experience • Added 400 support FTEs • $30MM invested in solutions hosting • Improve key metrics tied to client experience Sales Execution • Sales/service integration • Single corporate leadership • Single clien
Slide 30: Non-GAAP Financial Outlook
CY 2011 ACTUAL CY 2012 1 Non-GAAP Financial Outlook NON-GAAP REVENUE $1,465 $1,480-$1,520 NON-GAAP OPERATING MARGIN 20% 16-17% NON-GAAP NET INCOME $176 $143-$154 NON-GAAP DILUTED EPS $0.92 $0.74-$0.80 ($ in millions; except per share amounts) Note: Guidance provided by the company in a press release
Slide 31: Utilize Strong Cash Flow to Enhance Value
CAPITALIZATION ACTUAL 3/31/2012 $ in millions Utilize Strong Cash Flow to Enhance Value Cash and Marketable Securities $177 Revolver ($250mm) Term Loan Total Debt $343 Equity 1,490 Total Capitalization $1,833 Credit Statistics LTM EBITDA (1) $311 Total Debt / LTM EBITDA (1) 1.1x Debt / Capitalizatio
Slide 32: In Summary....
In Summary…. MARKET DIFFERENTIATION GROWTH
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Slide 36: Allscripts
Allscripts Investor Presentation MAY 2012
Slide 37: Appendix: Non-GAAP Reconciliations
Slide and Financial Measure GAAP-Non-GAAP Reconciliation Appendix: Non-GAAP Reconciliations Slide 24: 2010 Non-GAAP Revenue, Operating Income Slide 35, 36 Slide 24: 2011 Non-GAAP Revenue, Operating Income Slide 38 Slide 29: Q1 2012 Non-GAAP Revenue, Operating Income Margin and Diluted Earnings Per S
Slide 38: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation • GAAP – non-GAAP revenue and net income reconciliation for the twelve months ended December 31, 2010 Three Months Ended Twelve Months Ended 12/31/2010 12/31/2010 Eclipsys Q1 2010 Eclipsys Q2 2010 Eclipsys Additional Int Exp(a) Q3 2010 Q4 2010 CY 2010 Total revenue,
Slide 39: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation • GAAP – non-GAAP operating income reconciliation by quarter and twelve months ended December 31, 2010 Three Months Ended Twelve Months Ended 12/31/2010 12/31/2010 Eclipsys Q1 2010 Eclipsys Q2 2010 Eclipsys Additional Int Exp(a) Q3 2010 Q4 2010 CY 2010 Operating inc
Slide 40: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation • GAAP – non-GAAP Revenue, operating income margin and net income reconciliation for the three months ended March 31, 2012 Allscripts Healthcare Solutions, Inc. Condensed Non-GAAP Financial Information (In millions, except per-share amounts) (Unaudited)
Slide 41: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation • GAAP – non-GAAP revenue, operating income, net income and diluted earnings per share reconciliation for the twelve months ended December 31, 2011 Allscripts Healthcare Solutions, Inc. Non-GAAP Financial Information - 2011 Non-GAAP Financial Information (In million
Slide 42: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation • GAAP – non-GAAP EBITDA reconciliation for the year ended March 31, 2012 EBITDA Calculation ($ in thousands) For the 12 months ended 3/31/12 Net income, as reported $66.8 Income tax expense 43.2 Stock-based compensation expense 39.7 Depreciation and Amortization 13
Slide 43: Footnotes Regarding Financial Guidance
Footnotes Regarding Financial Guidance Financial guidance was last provided by the company in a press release on April 26, 2012. This presentation does not subsequently update or reaffirm Allscripts financial guidance. Allscripts non-GAAP guidance for calendar year 2012 assumes the following adjustm
Slide 44: Explanation of Non-GAAP Financial Measures
Explanation of Non-GAAP Financial Measures Allscripts reports its financial results in accordance with generally accepted accounting principles, or GAAP. To supplement this information, Allscripts presents in this release non-GAAP revenue, gross profit, operating income and net income, including non
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Slide 48: Allscripts
Allscripts Investor Presentation MAY 2012
Allscripts Healthcare Solutions — Investor Presentation (May 2012) on 6ix