Emeis · EURONEXT:EMEIS
Emeis — Orpea — FY2012 Earnings Presentation
47 slides from Emeis's earnings presentation, March 2013
Slide 1: 2012 Full-Year results
2012 Full-Year results Dr Jean-Claude Marian M.D. – Chairman Yves Le Masne – Chief Executive Officer Jean-Claude Brdenk – Deputy Chief Executive Officer March 2013 Steve Grobet – Investor Relations Officer
Slide 2: Content
Content 1. Regulatory environment 2. Last development 3. ORPEA network 4. 2012 Full-Year results 5. Strategy and outlook 2
Slide 3: Overview
Overview Dr Jean-Claude Marian M.D. – Chairman
Slide 4: ORPEA: European leader in global dependency care
ORPEA: European leader in global dependency care Nursing homes 431 facilities Post-acute and rehabilitation facilities 40,374 beds Psychiatric care facilities 20-year track record Quality oriented Quality of care strategy Quality of accommodation 5 countries European expansion 27% of the network abr
Slide 5: 2002–2012: 10 years of growth and value creation
2002 – 2012: 10 years of growth and value creation Number of beds Revenue (€m) 40,374 1,429 40,000 1,400 X 5.0 1,200 X 9.2 30,000 1,000 800 20,000 600 10,000 400 200 0 0 01.03.13 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 France Inte
Slide 6: Execution of the group's stated strategy
Execution of the group’s stated strategy STRTEGIC TARGETS ACHIEVEMENTS Increase of the network of 3,660 beds since start of 2012 Selective acquisition policy Acquisition and integration of Artevida in Spain and Medibelge in Belgium Improvement in EBITDAR margin: +60 bp 2012 profitability Recurring E
Slide 7: Regulatory environment
Regulatory environment Dr Jean-Claude Marian M.D. – Chairman
Slide 8: Daily rate in France
Daily rate in France Nursing Homes Post-acute and Psychiatric facilities DEPENDENCY: 10% Direct CARE & ACCOMMODATION Paid for by Local Authority reimbursement of (in a double bedroom) : 70% (PAA) and resident costs: Directly paid for by the National Health Insurance NO MARGIN CARE: 20% Directly paid
Slide 9: ORPEA positioning in the French healthcare system
ORPEA positioning in the French healthcare system ORPEA positioning Post-acute, Rehab. & Acute care facilities Nursing homes Psy facilities Paid by National Health Insurance Care + Accomodation1 Care + Accomodation1 Care only Daily cost / patient €500 - €800 ~ €150 ~ €20 % of total daily price 86% t
Slide 10: Challenges posed by population ageing in France
Challenges posed by population ageing in France Increase in the population Higher investment Increased spending linked of the very elderly requirements to the loss of autonomy Trend in nbr of people aged over 85 (million) Nbr of beds Cost (excl. land) Spending on loss of autonomy: Beds to be created
Slide 11: French bill on adapting society to the ageing phenomenon
French bill on adapting society to the ageing phenomenon State’s and local communities’ limited financial resources (investment and operating budget) Imperatives of the Financing based on national solidarity and individual responsibility (F. Hollande) Reform Focus on an integrated approach to the lo
Slide 12: Last development
Last development Jean-Claude Brdenk – Deputy Chief Executive Officer
Slide 13: ORPEA-DOMIDOM: a productive partnership
ORPEA-DOMIDOM: a productive partnership Objective: facilitate continuity of care between home, post-acute & rehabilitation facilities and Win-win partnership nursing homes Construction of an innovative integrated range of solutions covering every stage of dependence Sharing of skills and training by
Slide 14: An innovative telemedecine project
An innovative telemedecine project Origin: call for projects launched by the Paris region health authority Idea: improve emergency treatment arrangements in nursing homes Medical presence in nursing homes via a virtual medical practice Use specialised medical resources of post-acute & rehabilita
Slide 15: Flanders: European region with strong needs
Flanders: European region with strong needs Growth of people aged over 85 (Index 100 in 2011) Breakdown of people aged over 85 325 Brussels Strongest increase of 242 10% Flanders people aged over 85: Wallonia 171 Wallonia 58% Flanders Up 71% between 2010 and 2030 148 Brussels 32% 100 2010 2020 2030
Slide 16: ORPEA Belgium focuses its development in Flanders
ORPEA Belgium focuses its development in Flanders Strategic acquisition of 300 beds operational located in Antwerp (3 facilities) 900 beds 600 beds to be built in Antwerp: opening in 2015 and 2016 Facility in operation A pipeline of 1,500 beds under construction or Facility under construction refurb
Slide 17: Example of projects in Flanders
Example of projects in Flanders Ostend – 135 beds Knokke Le Zoute – 110 beds De Haan – 80 beds Edegem – 110 beds Shoten – 125 beds 17
Slide 18: ORPEA network
ORPEA network Steve Grobet – Investor Relations Officer
Slide 19: European leader: 40,374 beds at over facilities
European leader : 40,374 beds at over 431 facilities Belgium Europe Nbr of beds 56 facilities Open beds 31,726 6,518 beds Beds under refurbishment 3,246 Switzerland 2 facilities Beds under construction 5,402 165 beds France Total 40,374 339 facilities 29,477 beds Geographical breakdown of the networ
Slide 20: A secured pipeline of 8,648 beds
A secured pipeline of 8,648 beds Network development over 10 years 40,374 36,714 8,648 9,517 9,542 Open beds 8,490 7,648 5,986 Beds under refurbishment 31,726 4,622 27,197 or construction 23,397 2,821 3,750 18,036 1,926 2,517 16,008 13,752 11,381 6,208 6,789 7,785 8,264 2002 2003 2004 2005 2006 2007
Slide 21: France: facilities for 29,477 beds
France: 339 facilities for 29,477 beds France Nbr of beds Open beds 24,154 Openings of 2012: Beds under refurbishment 2,334 20 facilities (1,900 beds) Beds under construction 2,889 Strategic locations: 50% in Ile-de-France and Provence Alpes Cote d’Azur Total 29,477 Refurbishment and creation of new
Slide 22: International: facilities for 10,897 beds
International: 92 facilities for 10,897 beds Beds in Beds under Activity during 2012 Total Prospects operation development SPAIN Acquisition and integration of 2,938 beds n/a 2,938 beds Acquisition opportunities on Artevida (1,156 beds and places) 22 facilities attractive terms in major cities BELGI
Slide 23: 2012 Full-Year results
2012 Full-Year results Yves Le Masne – Chief Executive Officer
Slide 24: 2012: increase in profitability
2012: increase in profitability 2012 INITIAL TARGET 2012 ACHIEVEMENTS €1,429m 1 Revenues: €1,425m +15.8% 2 Strong organic growth +8.2% Recurring EBIT margin: 13.6% 3 Higher profitability + 40 bp 4 Property sales on attractive terms €300m (Selling price) Currently being audited 24
Slide 25: Strong growth of sales
Steep rise Strong in 2012 growth revenue: of sales +15.8% in 2011 In €m 2012 2011 % France 1,227.3 1,094.5 +12.1% Strong organic growth in 2012 86% 89% +8.2% (Approx. €100m) International 201.8 139.6 +44.5% 14% 11% Belgium 105.6 67.5 Spain 48.7 30.5 Strong increase abroad: +44.5% Italy 32.2 26.8 Swi
Slide 26: Strong increase in all profitability indicators
Strong increase in all profitability indicators In €m 2012 2011 % Revenues 1,429.1 1,234.1 +15.8% EBITDAR (Recurring EBITDA before rents) 368.5 311.4 +18.4% Recurring EBITDA 256.3 218.2 +17.5% Recurring EBIT (Rec. Operating Profit) 193.7 163.2 +18.7% EBIT (Operating profit) 222.2 190.0 +16.9% Net fi
Slide 27: Impact of new tax laws in France
Impact of new tax laws in France Tax on value added (CVAE and CFE): + €4.4m (€23m in 2012 compared with €6.7m in 2007) 350 Reform of the Business Tax transformed in Tax on Value added = CVAE + CFE 300 Business Tax 250 CVAE (=Tax on value added) 200 CFE 150 Revenue in France 100 2007 2008 2009 2010 2
Slide 28: Rise in operating profitability
Rise in operating profitability In €m 2012 2011 % Revenues 1,429.1 1234.1 +15.8% Staff costs -715.8 -625.0 +14.5% Expenses -277.2 -240.8 +15.1% Taxes and duties -67.5 -58.4 +15.5% Other income and expenses -0.1 1.4 N.S. EBITDAR (Recurring EBITDA before rents) 368.5 311.4 +18.4% % of revenues 25.8% 2
Slide 29: Trend in rents
Trend in rents Rents in €m +€7.6m +€4.1m +€5.9m +€1.5m 112.2 93.1 2011 Average Rents from Rents from Rents from 2012 rents increase in opening buildings sold acquisitions rents rents Average annualised increase in rents: +1.6% Currently being audited 29
Slide 30: Geographical breakdown of profitability
Geographical breakdown of profitability 2012 2011 In €m Recurring % of Recurring Rev. Rev. Rev. EBITDA % of Rev EBITDA France 1227.3 230.6 18.8% 1094.5 200.5 18.3% Belgium 105.6 13.1 12.4% 67.5 10.2 15.1% Spain 48.7 6.1 12.6% 30.5 1.8 6.0% Italy 32.2 2.3 7.2% 26.8 1.9 7.2% Switzerland 15.4 4.2 27.2%
Slide 31: Solid financial structure
Solid financial structure In €m 31-Dec-12 31-Dec-11 Non-current assets 4,151 3,757 Goodwill 380 323 Intangible assets 1,278 1,129 Property, plant & equipment and property under development 2,404 2,217 ASSETS Other non-current assets 89 88 Current assets 619 604 Of which cash, cash equivalents and ma
Slide 32: Optimisation of the Group's finances
Optimisation of the Group’s finances 2012: arrangement of private placements Objectives: diversify sources of financing and extend the maturity of debt on attractive terms Schuldschein (€35m) with a 5-year maturity (due 2017) Examples of Euro private placements in several tranches: – Maturities: 5-y
Slide 33: Flexible financial structure
Flexible financial structure 31-Dec- 30-June- 31-Dec- Banking covenants met comfortably Metrics 2012 2012 2011 Restated financial leverage Net debt* 1,802 1,756 1,619 5.56 Maximum authorised 5 Restated financial leverage 1 1.7 2.1 2.2 4 Restated gearing 2 1.2 1.3 1.2 3 1.72 * Excluding €121m in debt
Slide 34: Solid financial structure: debt maturity profile
Solid financial structure Debt maturity profile (excl. bridge loans) 600 Bridge loans = financing for property Loans, Financial property leases and Private Bonds under construction 500 Convertible Bonds – €122m over 4 years 400 OCEANE 300 – Converted into: 200 • Property lease if ORPEA remains owner
Slide 35: Operations: securing future growth
Operations: securing future growth ASSETS LIABILITIES Network of 40,374 beds Financed by medium-term 5- to 7- – 31,726 open beds in operation year loans – 3,246 open beds under refurbishment No significant installments ahead: – 5,402 beds under construction amortising loans Hedged by derivatives: fi
Slide 36: Increase in real estate portfolio value to €2.4b
Increase in real estate portfolio value* to €2.4b 31-Dec-11 31-Dec-11 Change Number of buildings 248 230 +18 build. FEATURES Of which fully owned 142 141 n.s. Built surface area (in sqm) 824,000 756,000 9% Average age < 10 years Total value (€m) 2,404 2,217 8% Strategic locations Of which assets in
Slide 37: Cash flow statement
Cash flow statement En M€ 2012 2011 H2 2012 H1 2012 Recurring EBITDA 256 218 134 122 Net cash flow from operating activities 208 202 130 78 Net cash flow from internal investing act.1 26 -102 54 -28 Investment in construction -274 -226 -87 -187 Property sales 300 124 141 159 Total internal cash flow
Slide 38: Increase in the dividend per share
Increase in the dividend per share Proposed dividend to the 2012 AGM: €0.60 / share 0.60 Increase in the dividend per share 0.50 + 20% 31.8 26.5 Share yield* 0.23 2% 18 years without any dividend 0.15 * Based on the closing price of the share at 22 March 2013 0.10 9.7 0.00 0.00 0.00 0.00 0.00 0.00 0
Slide 39: Strategy and outlook
Strategy and outlook Yves Le Masne – Chief Executive Officer Dr Jean-Claude Marian M.D. – Chairman
Slide 40: Openings of 2012: 2,150 beds and 1,300 jobs created
Openings of 2012: 2,150 beds and 1,300 jobs created Sainte Maxime (83), Nursing Home – 80 beds Osny (95), Post-acute facility – 60 beds Boussy St. Antoine (91), Nursing Home – 80 beds Villepinte (93), Psy. facility. – 100 beds Toulon (83), Psy. facility. – 160 beds St .Maur des Fossés (94), Nursing
Slide 41: Openings of 2013: 2,000 beds and 1,200 jobs created
Openings of 2013: 2,000 beds and 1,200 jobs created Guérande (44), Nursing Home – 80 beds Le Cannet (06), Nursing Home–120 beds Cateau Cambresis (59), Nursing Home– 94 beds Espira d’Agly (66), Nursing Home – 70 beds Batz sur Mer (44), Nursing Home – 48 beds Meyzieu (69), Post-acute facility – 104 be
Slide 42: 2013: continued growth and cash flow strategy
2013: continued growth and cash flow strategy STRATEGY OUTLOOK Value added development + Strong increase in revenue and solid Ramp-up in the number of mature facilities organic growth 79% 65% 2013 target: €1,600m (+12%) 59% 53% 31,726 23,397 27,197 18,036 Increase in profitability 31.12.2009 31.12.2
Slide 43: Appendices
ORE LIFE GOES ON WITH Us Appendices
Slide 44: Shareholding structure and Governance
Shareholding structure and Governance Shareholding structure (% of capital) Board of Directors – Dr Jean-Claude Marian – Chairman – Yves Le Masne – CEO Marian family – Brigitte Michel 23.1% – Alexandre Malbasa – Jean Patrick Fortlacroix – FFP Invest (Thierry Mabille de Poncheville) Free float 61.6%
Slide 45: French nursing home sector
French nursing home sector Breakdown of beds by type of operator Public and non-profit operators: reduction in investment capacity Low market share Private 20% commercial of the private Private sector: investment capacity and job creation 55% Public sector Reminder: in the UK, the market share of th
Slide 46: Strong solvency position of people aged 85+
Strong solvency position of people aged 85+ Comparison of nursing home cost vs. wealth €46,200 €135,000 Average cost of Average wealth of nursing home Assumptions: people aged 85+ for a resident Average cost: €2,200 per month Average length of stay: 21 months Source: IGAS 2010 report: €110,000 to €1
Slide 47: Stock market information
Stock market information € 35 Market data (last 12 months): – Average daily volume: 78,140 shares (= €2.3m) 30 – Price: €32.40 – High (12-month): €34.00 – Low (12-month): €24.20 25 – Turnover: 38% in 12 months – Market cap.: €1,717m 20 – Number of shares: 52,998,062 Dec-11 Feb-12 Apr-12 Jun-12 Aug-1