Metropolis Healthcare Ltd. · NSE:METROPOLIS
Metropolis Healthcare — Q4 FY2020 Earnings Presentation
64 slides from Metropolis Healthcare's earnings presentation, May 29, 2020
Slide 1: Intimation of Investor Presentation to stock exchanges
Ref: MHL/Sec&Legal/2020-21/101 Date: May 29, 2020 To, Head, Listing Compliance Department Head Listing Compliance Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Dalal Street, Exchange Plaza, Plot No. C/1. G Block, Mumbai - 400 001. Bandra -Kurla Complex, Ba
Slide 2: Reaching Out Responsibly - Investor Presentation May 2020
Reaching Out RESPONSIBLY Investor Presentation - May 2020
Slide 3: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Metropolis Healthcare Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any
Slide 4: Q4 & FY20 Financial & Operational Performance
Q4 & FY20 Financial & Operational Performance
Slide 5: Q4 & FY20 Financial & Operational Highlights
Q4 & FY20 Financial & Operational Highlights Metropolis is a Strong Consumer Focused and Trusted Pathology Brand in the Indian Diagnostics space ... Rs. 206 Cr 56% 2.44 Mn 5.26 Mn +2.7% YoY for Q4 (-)3.3% YoY for Q4 +7.1% YoY for Q4 Quality Focus +400 bps YoY for FY20 Rs. 856 Cr 10.00 Mn 19.62 Mn La
Slide 6: Business as usual 1st Jan till 15th Mar
Business as usual 1st Jan 20 till 15th Mar 20 Revenue in Q4 till Mar-15 Revenue in FY20 till Mar-15 +14.5% +15.7% ✓ Revenue in Q4FY20 till 15th March 2020 grew by 185 835 14.5% to Rs. 185 Crs as compared to Rs. 162 Crs in 162 721 Q4FY19 till 15th March 2019. ✓ 1st April 2019 to 15th March 2020 reven
Slide 7: Operational Highlights of Q4FY20
Operational Highlights of Q4FY20 ✓ A total of 49 new tests (1 in Infectious Molecular, 6 in Chemistry, 40 in molecular pathology and 2 in clinical genetics) have New Tests been validated and added to the test menu in Q4FY20 thus expanding our capabilities to conduct more specialized tests Customer F
Slide 8: Impact of Covid-19 on Financials
Impact of Covid-19 on Financials Month-wise Revenue (In Crs.) Month-wise EBIDTA (In Crs.) +13.5% +12.7% ✓ Reduction in daily average revenue by 50% in 74.4 19.4 second fortnight of March as compared to first. 65.6 17.2 January January ✓ Movement of Samples were restricted due to non-availability of
Slide 9: Impact of Covid-19 on Financials
Impact of Covid-19 on Financials Impact on Revenue for Q4 & FY20 Estimated Actual +15.9% +15.1% 231 881 ✓ Metropolis witnessed drop in 760 25 business on account of limited patient 201 25 activity due to nation-wide lockdown on account of Covid-19 outbreak for 856 the last 15 days of March 201 760 2
Slide 10: Q1 FY21 Outlook
Q1 FY21 Outlook Revenue Trend (E) Fixed & Semi-Variable Cost Trend Margin Trend (E) Break-even 15th Mar 31st Mar 30th Apr 31st May 30th Jun 15th Mar 31st Mar 30th Apr 15th Mar 31st Mar 30th Apr 31st May 30th Jun ✓Revenue in April 2020 was down to ~40% of the normal trend and is expected to improve t
Slide 11: Metropolis is the 1st Private Lab to partner for Covid-19 testing
Metropolis is the 1st Private Lab to partner for Covid-19 testing Received permission to commence Covid-19 testing by Indian Regulator Fighting Covid-19 ICMR on March 24th 2020 We were the 1st Private Laboratory to commence Covid-19 testing with highest TAT, highest volumes and accuracy rates Covid-
Slide 12: Metropolis resilient model… Covid-19 is an opportunity
Metropolis resilient model… Covid-19 is an opportunity 1 Reduction in Fixed and Semi-variable Costs ✓ We have initiated cost rationalization measures and have been successful in reducing fixed and semi-variable costs from Rs. 28- 29 Cr per month to Rs. 21-22 Cr a month i.e. reduction of more than 20
Slide 13: Covid-19 will change the landscape of Indian Diagnostic Industry
Covid-19 will change the landscape of Indian Diagnostic Industry 05 Faster Consolidation and 01 Strong Brands to benefit 03 Covid-19 capable labs Unorganised standalone labs Covid-19 will become a new regulatory adoption are facing challenges in terms normal test in times to come,; We expect faster
Slide 14: Q4 & FY20 Consolidated Financial Performance
Q4 & FY20 Consolidated Financial Performance Revenue Rs. (In Crs) Reported EBIDTA Rs. (In Crs) Revenue 27.0% 27.1% ✓Revenue in Q4FY20 grew by 2.7% to Rs. 206 Crs as compared to Rs. 201 Crs in Q4 Q4 Q4FY19. Revenue growth for FY20 was 12.6%. Q3 +12.6% Q3 +12.9% ✓As per management estimates revenue gr
Slide 15: Operating Performance
Operating Performance No. of Patient Visits (In Mn.) Revenue Per Patient (In Rs.) +11.3% +3.2% +12.6% 10.00 836 854 856 8.98 778 ✓ Total patient visit has increased from 10.0 8.9 2.45 8.98 Mn in FY19 to 10.00 Mn in FY20 2.53 -3.3% 7.7 7.0 2.45 registering a growth of 11.3% Y-o-Y 2.15 +13.9% 2.35 +16
Slide 16: Key Balance Sheet Highlights
Key Balance Sheet Highlights ROCE ROE 42.8% 29.1% ✓ Metropolis is a Zero-Debt company 40.0% 27.0% with growing cash & cash equivalents year on year basis. Cash & Cash Equivalents as on March 2020 stood at Rs. 223 crs ✓ Inspite of Covid-19 outbreak and partial loss of revenue for the month of March 2
Slide 17: Network Expansion
Network Expansion Laboratory Network Service Network Lab on Lease ARC Greenfield Third Party PSCs +9.3% 2,731 119 124 Owned PSCs 2,336 598 106 19 20 6.4x 95 8 575 2 1,650 520 1,873 98 100 104 887 1,506 93 428 308 879 151 356 117 223 251 255 260 160 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Networ
Slide 18: Increasing Share of B2C Business in Focus Cities
Increasing Share of B2C Business in Focus Cities B2C Contribution in Focus Cities for FY20 (Rs. in Crs) B2C Ratio 45% 48% 52% 56% ✓ B2C segment now contributes 56% of the revenue from Focus cities as compared to 52% in FY19. +15.5% ✓ Revenue from B2C in focus cities stands at 56% for 269 Q4FY20 as c
Slide 19: Market Dynamics – a long runway of growth
Market Dynamics – a long runway of growth Revenue Mix between Focus, Seeding & Others Cities Revenue Mix between Geographies 5% 8% 5% 9% 20% 25% 27% 26% FY19 FY20 FY19 FY20 56% 60% 20% 55% 54% 19% 5% 6% Others Seeding Focus North South East West International Improving Revenue Diversification ✓ The
Slide 20: Specialized Test Menu capabilities creates a sustainable leadership position
Specialized Test Menu capabilities creates a sustainable leadership position Volume Mix Value Mix 8% 8% 5% 8% 17% 18% 16% 15% 35% 39% FY19 FY20 41% FY19 37% FY20 37% 37% 41% 38% Routine Specialized Routine Specialized Semi-Specialized Wellness Semi-Specialized Wellness Improving Revenue Diversificat
Slide 21: Mobile App Launched in Q3FY20 with features enabling ease of access
Mobile App Launched in Q3FY20 with features enabling ease of access Expert TruHealth Risk Assessment TruHRA Customized Check-ups Booking Appointments See, Share & Store Fitness Tracker Reports Inner Health Tracking Medication Tracker Parameters Doctor’s, Hospital’s & Chat with Experts Metropolis nea
Slide 22: TruHealth App – Increasing Traction
TruHealth App – Increasing Traction App Review snapshots Total Installs: 01 Active Users 5,907 2,241 06 02 Leads Generated (Jan to Mar): 460 leads TruHealth App Total Stats Reviews: 68 05 03 Avg. Rating: 4.2 Stars Total Ratings by 4,206 Our Pilot Launch is successful with Positive reviews & Rating a
Slide 23: Recent Awards and Accolades
Recent Awards and Accolades Period Particulars Our MD, Ms. Ameera Shah won the Leader of the Year: NextGen award at the CNBC-AWAAZ February 2020 CEO Award organized by CNBC Awaaz held at Raipur Metropolis won the Most Admired Healthcare Company of the Year and our CEO, Mr. February 2020 Vijender Sin
Slide 24: Acquisitions & Expansions in FY20
Acquisitions & Expansions in FY20 Acquisition in Surat Merge Histoxpert Metropolis decided to merge Histoxpert operation into Metropolis Acquisition of 4 Front End Labs in Surat effective Sep 30, 2019, which is parent company. As on date, Histoxpert is a one-year old JV providing a focus city, for e
Slide 25: Consolidated Adjusted Profit & Loss Statement
Consolidated Adjusted Profit & Loss Statement Particulars (Rs. Crs.) Q4FY20 Q4FY19 Y-o-Y FY20 FY19 Y-o-Y Revenue from Operations 206.1 200.8 2.7% 855.5 760.1 12.6% Cost of Raw Material Consumed 50.9 43.8 204.1 173.5 Laboratory Testing Charges 2.6 1.7 6.9 5.6 Employee Expenses 44.9 42.5 190.2 172.7 O
Slide 26: Consolidated Balance Sheet
Consolidated Balance Sheet Assets (Rs. Crs.) Mar-20 Mar-19 Equity & Liabilities (Rs. Crs.) Mar-20 Mar-19 Non-current assets 355.2 247.9 Equity 525.2 420.0 Property, Plant and Equipment 121.2 116.7 Equity Share capital 10.1 10.0 Goodwill 90.3 78.6 Other equity 513.4 408.5 Other intangible assets 25.2
Slide 27: Summary of Consolidated Cash Flow
Summary of Consolidated Cash Flow Cash Flow Statement (Rs. Crs) March 2020 March 2019 Operating profit before working capital changes 251.5 208.3 ✓ Strong focus on cash flow continues Adjustments for Non-Cash Items ✓ Better Working capital Management has resulted in a sharp improvement in Operating
Slide 28: Overview
Overview
Slide 29: We are Metropolis: The Pathology Specialist
We are Metropolis: The Pathology Specialist To be a respected healthcare brand trusted by clinicians, patients and stakeholders. Positively impact lives of patients Vision in their most anxious times and turn their anxiety in to assurance. Helping people stay healthy, by accurately revealing their 3
Slide 30: Journey to Leadership Position
Journey to Leadership Position ✓ First Referral Laboratory Set- ✓ Ameera Shah takes charge ✓ Secondary transaction by ✓ Exit of Warburg Pincus, ✓ Strong Thrust on Retail up by Founder & Chairman Dr. Foxcreek Investment Limited management control by frontend Expansion ✓ First major acquisition - Sush
Slide 31: Three decades of Delivering Value to Stakeholders
Three decades of Delivering Value to Stakeholders Leadership Position Across Industry METROPOLIS Focus Area ACCREDITATION CUSTOMER & QUALITY EXPERIENCE ROCE SPECIALITY SCORES SCORE BUSINESS INCREASED INFRASTRUCTURE PRODUCTIVITY REVENUE PER REALISATION PER TEST MENU OF YOUNG PATIENT PATIENT NETWORK 3
Slide 32: Key Drivers for Growth
Key Drivers for Growth 01 Industry Growth 05 Expansion Plan 02 Value Chain 06 Quality 03 Business Model 07 People 04 Service Network 08 Digital Transformation 31
Slide 33: Diagnostic Industry Poised to grow…
1a. Diagnostic Industry Poised to grow… Size of Indian Healthcare Industry Size of Indian Diagnostics Market Indian Diagnostics Industry Breakup (in Billion $) 6.0% 4.0% 35% 12.3 9.0% Healthcare Delivery - Hospitals Pharma 9.1 42% Pathology 13.0% Medical Devices Radiology 68.0% Diagnostics 58% Healt
Slide 34: Top players to continue to acquire market share of standalone centers
1b. Top players to continue to acquire market share of standalone centers Brand Awareness Increased brand awareness amongst patients and customers towards quality, reliability and test accuracy Service + Scale Large Test menu Large Test menu by organized diagnostics chains Factors leading Consolidat
Slide 35: Presence in key pockets of Value Chain
2.Presence in key pockets of Value Chain Diagnostic Industry - Fragmented Routine Test Metropolis Focus Highly Fragmented Market Low Quality Standard Majority Diagnostic Players Technician + Run Lab Low on Technical Qualifications & Moderate Competition Presence across Accreditations (99.9% labs rem
Slide 36: Hub & Spoke Model to scale efficiently
3. Hub & Spoke Model to scale efficiently Home Collection Global Reference Lab (GRL) Individual Patient (B2C) Wholesale (B2B) RRL / Satellite Lab Express Lab Third Party Lab / Hospitals / ARCs Collection Patient Centres Patient Leverage Widespread Delivery to our Enhances Collection of Greater netwo
Slide 37: Patient Centric Network
4.Patient Centric Network Global and More than ~4,000 Present in 19 States 35+ Years National Over 10,000 Patient Test’s & Profiles & 210 cities Quality Touch Points of Credible Operations Accreditations Why Metropolis ? Collection ✓ Conclusive Diagnosis with Large Centres Pics test Menu backed by H
Slide 38: Asset Lite Expansion Plan
5. Asset Lite Expansion Plan Asset Light Model Network Expansion Strategy Doctor APSC/ Lab on ✓ Focus on Asset Light Model to achieve Geographic Expansion with Bleeding DAPSC Lease High Scalability Point (DBP) ✓ The A-PSC and D-APSC Model allows us to grow our revenues by providing management and br
Slide 39: Quality in Core
6a. Quality in Core Quality Scores of 98.5% in 2018-19 by College Quality protocols following global standards of American Pathology 99.9% of industry labs remain un-accredited with lack of minimum standards in the industry Large Investments in Focus on Governance Information and rigorous audit Tech
Slide 40: Globally Compliant Quality Standards
6b. Globally Compliant Quality Standards No. of Audits Conducted by PAC Team “Global Lab Accreditations” FY 17-18 18-19 H1 20 FY 20 665 1,312 597 1,057 ✓ PAC Team: Special Pre Analytical Care Team constituted as part of the Quality Assurance Team ✓ This team conducts thorough internal audits as per
Slide 41: People are our greatest asset
7. People are our greatest asset ✓ New HR Management System for ✓ Strong culture equal opportunity ✓ Full Fledged Learning Management automated processes improving workplace System that is used for daily training productivity and ensuring availability of across the Company. employee data on demand ✓
Slide 42: Leveraging IT for Competitive Advantage
8. Leveraging IT for Competitive Advantage 1 2 3 4 Improving Business revenue Improved Operational Improve Customer Cost Saving & Optimization generation capabilities Efficiency Experience ✓ Zero Data Loss; 100% data ✓ IBM Watson Campaign Automation replication in remote location ✓ Mobility Applicat
Slide 43: Digital Transformation to improve efficiency
8a. Digital Transformation to improve efficiency 1 Standardization Achieve standardization across 2 Reduced Errors Reduce incidence of errors due to human intervention our operations Patients & Customers 3 Technical Operations Provide convenience to our 5 Monitor Technical Operations patients and cu
Slide 44: Future Strategy
Future Strategy 01 Increase Services 02 Increase Scale 43
Slide 45: Customer Centricity: In everything we do
Customer Centricity: In everything we do 01 02 03 04 Easy to Interpret Test Sample Collection from Conclusive Diagnosis Digital Access Report Doorstep We also have a policy of ensuring We have developed a Mobile Conclusive Diagnosis to our Application We offer our patients a Detailed We have increas
Slide 46: Sustainable Growth across Network
Sustainable Growth across Network Network of 210 Cities Criteria % of Revenue for FY20 Strategy ✓ Increasing productivity of Collection Centers ✓ Enhancing our Laboratory Capacity and Test Menu by adding Latest Machines and Technology ✓ High Potential Market Focus Cities ✓ Expanding B2C share of Bus
Slide 47: Focus on Profitable B2C Business
Focus on Profitable B2C Business Increase B2C sales mix Deeper Network Strengthen Productivity of Wellness initiatives Penetration Metropolis Brand existing young network for consumers Deeper centre penetration Expand Branded third- Increase number of referring Creating an easy and engaging in Focus
Slide 48: Growing Inorganically– A Win-Win Strategy
Growing Inorganically– A Win-Win Strategy Build Industry Best practices Introducing Standardized Machines and SOPs in a phased manner resulting in efficiency and quality enhancement Access to Metropolis Network Providing acquired entities access to Metropolis Sales and Marketing Network to improve t
Slide 49: Successful Track Record of Inorganic Strategy: Acquisitions in 15 years
Successful Track Record of Inorganic Strategy : 22 Acquisitions in 15 years Revenue at the time of Few of the Acquired Companies Year of Acquisition Location Revenue for FY20 acquisition Sudharma Metropolis Health Services 2003 Kerala Rs. 1.8 Crores Rs. 49.6 Crores Private Limited Golwilkar Metropol
Slide 50: Plenty of Opportunities for Growth…
Plenty of Opportunities for Growth… Growing our offering of Test Packages to Increase Revenue Test Packages Metrics. Customized packages to Institutional Customers Expansion and Personalized Packages to Individual Patients are key Leverage our vast capabilities in Molecular Diagnostics, Aggressive N
Slide 51: Historical Financial & Operational Performance
Historical Financial & Operational Performance
Slide 52: Pan India Presence…
Pan India Presence… Metropolis Service Network Metropolis Service FY19 FY20 Network Laboratories 119 125 Owned PSC’s 255 260 Third Party PSC’s 1,506 1,873 ARC’s 575 598 Total 2,455 2,731 On Consolidated Basis Maps not to scale. All data, information, and maps are provided "as is" without warranty or
Slide 53: …with Aggressive Network Expansion Strategy
…with Aggressive Network Expansion Strategy Laboratory Network Service Network ARC Third Party PSCs +8.6% 124 Owned PSCs 2,731 119 106 2,336 598 95 +58.9% 89 575 1,650 520 1,873 887 1,506 308 879 428 151 356 117 223 251 255 260 160 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Network Strategy H
Slide 54: Better than industry growth
Better than industry growth Revenue (In Rs. Crs.) Bolstering Growth in Wellness Segment Metropolis Wellness revenue contribution for +15.8% 856 Metropolis is 7.9% in FY20 760 644 545 475 This market is expected to grow at a CAGR of 20% over next 3 financial years (Frost & Sullivan) FY16 FY17 FY18 FY
Slide 55: Robust Operating & Financial Performance
Robust Operating & Financial Performance No. of Patient Visits (In Mn.) Revenue Per Patient (In Rs.) +5.5% Metropolis realization per +9.7% 10.0 854 856 test and sample is higher than 836 8.9 778 industry owing to:- 7.7 692 6.9 7.0 ✓ ~37% of specialised test FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 F
Slide 56: Well growing B2C Mix
Well growing B2C Mix Retail contribution in Focus Cities to Total Revenue 56% 52% 45% 48% 43% Primary Strategy of the Company is to increase the Retail share in focus cities to 65% FY16 FY17 FY18 FY19 FY20 Chart shows B2C contribution over the years in focus cities; Mumbai, Chennai, Bangalore, Surat
Slide 57: Financial Highlights
Financial Highlights Revenue (In Rs. Crs.) Reported EBITDA (In Rs. Crs.) ROCE (%) 856 232 +15.8% +15.6% 46.5% 760 206 43.6% 42.8% 644 173 38.3% 40.0% 545 155 475 130 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 EBITDA (%) Reported PAT (In Rs. Crs.) ROE (%) +11.7% 27.3%
Slide 58: Profit & Loss Statement
Profit & Loss Statement Profit & Loss (Rs. Crs.) FY20 FY19 FY18 FY17 FY16 Revenue from Operations 855.5 760.1 643.6 544.7 475.5 Cost of Material Consumed 204.1 173.5 145.9 135.1 124.6 Laboratory testing charges 6.9 5.6 5.7 2.5 3.1 Total Raw Material 211.0 179.1 151.6 137.6 127.7 Gross Profit 644.5 5
Slide 59: Balance Sheet
Balance Sheet Assets (Rs. Crs.) Mar-20 Mar-19 Mar-18 Mar-17 Mar-16 Equity & Liabilities (Rs. Crs.) Mar-20 Mar-19 Mar-18 Mar-17 Mar-16 Non-current assets 355.2 247.9 230.1 230.1 170.6 Equity 525.2 420.0 429.1 344.1 293.9 Property, Plant and Equipment 121.2 116.7 112.3 105.2 105.6 Equity Share capital
Slide 60: Board of Directors and Management Team
Board of Directors and Management Team
Slide 61: Board of Directors
Board of Directors Dr. Sushil Kanubhai Shah Ameera Sushil Shah Chairman & Executive Director Managing Director Holds a bachelor’s degree in Medicine and Surgery Holds a bachelor’s degree in Business Administration and a degree of Doctor of Medicine in Pathology from the University of Texas and also
Slide 62: Management Team
Management Team Vijender Singh Dr. Nilesh Shah Chief Executive Officer President and Chief of Science & Innovation Holds a bachelor’s degree in Science from Kurukshetra Holds a master’s degree in Engineering from University of University and completed an Executive Education Mumbai and a Diploma in M
Slide 63: Management Team
Management Team Avadhut Joshi - SBU Head (West & International) He has around 17 years of work experience in the diagnostics industry. He was previously associated with SRL Labs before joining MHL. An expert on Sales strategy, planning and inorganic expansion, Avadhut has been a part of several emin
Slide 64: For further information, please contact
For further information, please contact: Company : Investor Relations Advisors : Metropolis Healthcare Ltd. Strategic Growth Advisors Pvt. Ltd. CIN – U73100MH2000PLC192798 CIN - U74140MH2010PTC204285 Mr. Rakesh Agarwal - CFO Mr. Shogun Jain / Mr. Sagar Shroff Email Id – rakesh.agarwal@metropolisindi
Metropolis Healthcare — Q4 FY2020 Earnings Presentation on 6ix