Accendra Health, Inc. · NYSE:ACH
Accendra Health — Owens & Minor — Investor Day (May 2021)
126 slides from Accendra Health's investor day presentation, May 26, 2021
Slide 1: Investor Day 2021
INVESTOR DAY 2021
Slide 2: Safe Harbor
Confidential & Proprietary to Owens & Minor Inc. Safe Harbor This presentation is intended to be disclosure through methods reasonably designed to provide broad, non-exclusionary distribution to the public in compliance with the SEC's Fair Disclosure Regulation. This presentation contains certain ''
Slide 3: The O&M Team
S H A N A N E A L EVP, Chief Human Resources Officer M A R K Z A C U R EVP, Chief Commercial Officer P E R R Y B E R N O C C H I CEO, Byram Healthcare C H R I S L O W E R Y President, Global Products The O&M Team E D P E S I C K A President & CEO J E F F J O C H I M S EVP, Chief Operating Officer &
Slide 4: The New Owens & Minor
THE NEW OWENS & MINOR Ed Pesicka President & Chief Executive Officer
Slide 5: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 6: O&M Overview: Leading Healthcare Solutions Provider
Confidential & Proprietary to Owens & Minor Inc. O&M Overview: Leading Healthcare Solutions Provider 15,000+ Teammates Worldwide 1,200+ Branded Manufacturers 4,000+ Healthcare Providers Served 95+ Facilities Worldwide A growth-focused, integrated healthcare solutions provider with broad medical dist
Slide 7: O&M Core Segments
O&M Core Segments GLOBAL PRODUCTS GLOBAL SOLUTIONS M E D I C A L D I S T R I B U T I O N S E R V I C E S P R O P R I E TA R Y P R O D U C T S PAT I E N T D I R E C T
Slide 8: New Leadership and Strategic Focus Transformed the Business
Confidential & Proprietary to Owens & Minor Inc. New Leadership and Strategic Focus Transformed the Business, Ready for Long-term Growth O&M Journey: A New Path Forward $0 $100 $200 $300 $400 $500 2015 2016 2017 2018 2019 2020 2021 E 2022+ Adjusted EBITDA1 Progression Execution Issues • Lost custome
Slide 9: O&M Business Blueprint
Confidential & Proprietary to Owens & Minor Inc. O&M Business Blueprint Performance & Achievement OUR RESULTS O&M Business System OUR DISCIPLINE Mission and Values Driven OUR CULTURE Investments & Expansion OUR FUTURE
Slide 10: Building Our Culture & Living Our Mission
Confidential & Proprietary to Owens & Minor Inc. Act with the highest standards of ethics Honor commitments Aspire for improvement and growth Get better every day Deliver best-in-class service regardless of circumstances Drive cost efficiency & high-quality Listen to our customers and to one another
Slide 11: Discipline Through O&M Business System Framework
Confidential & Proprietary to Owens & Minor Inc. 4 2 13 Discipline Through O&M Business System Framework Standard Management System Program Management Teammate Engagement & Leadership Continuous Improvement • Repeatable Processes • Alignment & Execution • Standardized Toolset • Flawless Project Exec
Slide 12: Investments Resulted in Significant Benefits for Customers
Confidential & Proprietary to Owens & Minor Inc. G L O B A L P R O D U C T S Investments Resulted in Significant Benefits for Customers • Laminator - Expansion of manufacturing capabilities in non-woven fabric used in PPE products in Lexington, NC • Installation of new N95 production lines in North
Slide 13: Resulted in Significant Benefits for Customers and O&M
Confidential & Proprietary to Owens & Minor Inc. Resulted in Significant Benefits for Customers and O&M 2020 Result: 99.9% Shipping Accuracy 2020 Result: 99+% On-Time Delivery 2020: #1 Stock in S&P 600 Market Rewarded 2020: 100% KPI Achievement Customer Service Leverage Ratio Improvement Financial S
Slide 14: Video
Confidential & Proprietary to Owens & Minor Inc. Video
Slide 15: Our Value Chain is a Key Differentiator
Confidential & Proprietary to Owens & Minor Inc. Our Value Chain is a Key Differentiator How Our Businesses Work Together Today • High touch, significant value proven through COVID • Creates sticky, highly recurring relationships • Expands MarginsServices The Glue 1,200+ Branded Medical Product Supp
Slide 16: The Current Healthcare Landscape is Rapidly Evolving
Confidential & Proprietary to Owens & Minor Inc. • Building health equity – Developing community partnerships – Equitable vaccine distribution – Removing biases • Home Health Growth • Workforce concerns – RN shortages – Mitigating workforce burnout – Succession planning • Continued consolidation • A
Slide 17: Strategic Priorities: Taking Control of Our Own Destiny
Confidential & Proprietary to Owens & Minor Inc. Strategic Priorities: Taking Control of Our Own Destiny Harness multi-year rebuild of core business disciplines, culture, processes LEVERAGE THE FOUNDATION Continue deleveraging momentum and utilize balance sheet to drive growth UTILIZE FINANCIAL STRE
Slide 18: Steps 1 & 2: Leverage the Foundation, Utilize Financial Strength
Steps 1 & 2: Core to Our Business Today & Tomorrow Maintain unrelenting customer focus Continue to ingrain our IDEAL Values culture Expand operational excellence (O&M Business System) Continue to enhance infrastructure Harness multi- year rebuild of core business disciplines, culture, processes Driv
Slide 19: Steps 3 & 4: Pivoting to Growth & Stakeholder Value
Confidential & Proprietary to Owens & Minor Inc. Steps 3 & 4: Pivoting to Growth & Stakeholder Value Expand capacity to maintain growth in strategic areas Broaden proprietary product portfolio Diversify into new channels and adjacent markets Utilize strategic M&A to accelerate path Multi-prong strat
Slide 20: O&M 2020-2026 Targets
Confidential & Proprietary to Owens & Minor Inc. O&M 2020-2026 Targets Revenue $8.5B $12B+ Adjusted EBITDA1 $335M $650M+ Adjusted EPS1 $2.26 $6.00+ $4.00 6% CAGR* 12% CAGR* 18% CAGR* $9.8B $475M *6-year CAGR from 2020-2026 2021E Represents mid-point of guidance provided on May 5, 2021 ¹Reconciliatio
Slide 21: The Products: Global Products
THE PRODUCTS: GLOBAL PRODUCTS Chris Lowery President, Global Products
Slide 22: Today's Agenda: Through the O&M Value Chain
Confidential & Proprietary to Owens & Minor Inc. Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MA
Slide 23: Trusted, Market-Leading Products for Every Care Setting
Confidential & Proprietary to Owens & Minor Inc. Trusted, Market-Leading Products for Every Care Setting Market Leading & Customer Recognized Brands Essential products for delivery of care every day. Our Private Label Broad portfolio of products for the prevention of healthcare-associated infections
Slide 24: Differentiated Americas-based Manufacturing & Supply Chain
Confidential & Proprietary to Owens & Minor Inc. Differentiated Americas-based Manufacturing & Supply Chain Del Rio, TX N95 Respirators San Pedro Sula, Honduras Surgical Gowns Isolation Gowns Williamsburg, VA Surgical Procedure Kits Acuna, Mexico Face Masks Face Shields N95 Respirators Isolation Gow
Slide 25: Market Leader with Broadest Portfolio of Self-Manufactured Products
Confidential & Proprietary to Owens & Minor Inc. Market Leader with Broadest Portfolio of Self-Manufactured Products Broad Offering of Infection Prevention and “PPE” Products Isolation Gown Gloves Surgical Gown For Operating Room Surgical Drapes & Packs N95 Respirator Surgical Mask for Operating Roo
Slide 26: Multi-Site Manufacturing Builds Trust at Critical Times
Confidential & Proprietary to Owens & Minor Inc. Multi-Site Manufacturing Builds Trust at Critical Times Raw Material Isolation Gown Sterilization Wraps GlovesSurgical Gown For Operating Room Surgical Drapes & Packs N95 Respirator Surgical Mask For Operating Room Procedure Mask Face Shield Del Rio,
Slide 27: A Rich History of Market Leadership and Innovation
Confidential & Proprietary to Owens & Minor Inc. Facial Protection Innovation Surgical Gown Innovation Gloves Innovation Sterilization Innovation 2012 SMART-FOLD* Sterilization Wrap 2012 QUICK CHECK* Sterilization Wrap 2018 HALYARD* and BELINTRA® SMART-FOLD* STERISYSTEM® Transport and Storage 2012 D
Slide 28: PPE Market Permanently Altered
Confidential & Proprietary to Owens & Minor Inc. PPE Market Permanently Altered O&M Teammates Revised Healthcare Protocols and New Stockpiling Requirements Calling for Increased Use of PPE Demand for Stockpile Recovery Increased Use of PPE in Both Healthcare and Non-Healthcare Settings Preference fo
Slide 29: Igniting Sustainable Growth in Global Products: 2020-2026
Confidential & Proprietary to Owens & Minor Inc. Diversifying into new channels and adjacent markets • Leverage historical private label markets we know through new branded products • Opportunities in Cleanroom PPE & Retail / E-commerce markets Broadening proprietary product / service portfolio • Nu
Slide 30: Capacity Expansion: Positioned to Benefit Moving Forward
Confidential & Proprietary to Owens & Minor Inc. Capacity Expansion: Positioned to Benefit Moving Forward - Facial Protection / N95 - Isolation gowns - Nonwoven fabric - Surgical products- Gloves Project Status 2020 ---------------------- > 2022 1 Del Rio N95 expansion COMPLETE 2 Acuna standard mask
Slide 31: Large Market Opportunities in New Product Categories
Confidential & Proprietary to Owens & Minor Inc. Portfolio Expansion Opportunities • Market Size: $2B+* • Halyard Brand Launch Date: 2H 2021 • Market Size: $250M* • Launch Date: Q2 2021 Large Market Opportunities in New Product Categories Traditional Wound Care Incontinence Care CPT Transformation *
Slide 32: New Channels & Markets
Confidential & Proprietary to Owens & Minor Inc. New Channels & Markets • Market size:$100M* • Launch Date: Q4 2021 • Ergonomic design for improved experience for orthopedic surgeons involved in high-risk, fluid-intensive procedures • Market size:$1B+* • Launch Date: Q4 2020 • Innovative new “accele
Slide 33: Global Products 2020-2026 Revenue Target
Confidential & Proprietary to Owens & Minor Inc. Global Products 2020-2026 Revenue Target* Key Drivers • Capacity expansion and portfolio expansion • Medical distribution channel penetration • Glove-market returns to pre-pandemic pricing construct in 2022 • Non-PPE Revenue exceeds pre-Covid levels s
Slide 34: The Backbone: Medical Distribution
THE BACKBONE: MEDICAL DISTRIBUTION Jeff Jochims EVP, Chief Operating Officer & President, Medical Distribution
Slide 35: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 36: Medical Distribution
Confidential & Proprietary to Owens & Minor Inc. Medical Distribution Traditional Med-Surg Supply Outsourced Logistics ACUTE CARE HOSPITALS• Buy-Sell Product Distribution • Bulk & LUM delivery • Tailored to individual customer needs • 3PL Logistics • Healthcare focused / FDA compliant • Pandemic pre
Slide 37: Medical Distribution
Confidential & Proprietary to Owens & Minor Inc. Medical Distribution Traditional Med-Surg Supply Outsourced Logistics ACUTE CARE HOSPITALS• Buy-Sell Product Distribution • Bulk & LUM delivery • Tailored to individual customer needs • 3PL Logistics • Healthcare focused / FDA compliant • Pandemic pre
Slide 38: O&M Global Solutions: Medical Distribution
Confidential & Proprietary to Owens & Minor Inc. O&M Global Solutions: Medical Distribution 140 Years of Experience Delivering Medical Products to Point of Care Unparalleled Choice, Flexibility, and Security of Supply Ideal Balance of Technology and Touch that Our Partners Need Seamless Support and
Slide 39: National Reach: Critical to the U.S. Healthcare Infrastructure
Confidential & Proprietary to Owens & Minor Inc. National Reach: Critical to the U.S. Healthcare Infrastructure Medical Distribution Services Care Room 40+ Distribution Centers Across the US < 4 Hours Avg. Proximity to 90% of US Population 500+ Tractors & Trailers in the O&M Fleet 1,200 Suppliers 4,
Slide 40: Video
Confidential & Proprietary to Owens & Minor Inc. Video
Slide 41: Balancing Tech and Touch
Confidential & Proprietary to Owens & Minor Inc. Balancing Tech and Touch Tote De-Stacker Vertical Reciprocating Conveyor Customized Cart LoadingTechnology = Flexibility De-casingTouch = Custom Solutions Custom Cart Loading LUM PPI Capability SurgiTrack ReturnsIn-Line Scale Voice Pick
Slide 42: Medical Distribution
Confidential & Proprietary to Owens & Minor Inc. Medical Distribution Traditional Med-Surg Supply Outsourced Logistics ACUTE CARE HOSPITALS• Buy-Sell Product Distribution • Bulk & LUM delivery • Tailored to individual customer needs • 3PL Logistics • Healthcare focused / FDA compliant • Pandemic pre
Slide 43: O&M Outsourced Logistics By The Numbers
Confidential & Proprietary to Owens & Minor Inc. O&M Outsourced Logistics By The Numbers ~ 1,950,000 Orders shipped annually > $300,000,000 Customer-Owned Inventory Value > 25+ Distribution Centers actively providing 3PL services ~ 170,000 BIN Locations Under Management ~ 312,000+ Purchase Orders Re
Slide 44: Outsourced Logistics – Proven Success Profile
Confidential & Proprietary to Owens & Minor Inc. Outsourced Logistics – Proven Success Profile Customer 1 • World leader in medical technology – Expertise in regenerative technology, neurosurgical products, and advanced wound care • Deep experience in neurosurgery – Broad portfolio of products and s
Slide 45: Medical Distribution
Confidential & Proprietary to Owens & Minor Inc. Medical Distribution Traditional Med-Surg Supply Outsourced Logistics ACUTE CARE HOSPITALS• Buy-Sell Product Distribution • Bulk & LUM delivery • Tailored to individual customer needs • 3PL Logistics • Healthcare focused / FDA compliant • Pandemic pre
Slide 46: Predictive Analytics Leading to Increased Service Levels
Confidential & Proprietary to Owens & Minor Inc. Predictive Analytics Leading to Increased Service Levels • “Best in Class” inventory management software generates a forward-looking demand prediction by utilizing statistical forecasting and machine-based learning (AI) • Faster & More Accurate respon
Slide 47: A Snapshot of KPI Measures & Reporting
Confidential & Proprietary to Owens & Minor Inc. A Snapshot of KPI Measures & Reporting
Slide 48: Visibility through myOM
Visibility through myOM™ • On-hand at O&M DC • On order to O&M • Safety stock inventory levels • Substitute item inventory status Data you care about Actionable data • Daily fill rates • Root cause analysis • Problem products • Pro-active identification • Back-order tracking • Order status informati
Slide 49: Medical Distribution
Confidential & Proprietary to Owens & Minor Inc. Medical Distribution Traditional Med-Surg Supply Outsourced Logistics ACUTE CARE HOSPITALS• Buy-Sell Product Distribution • Bulk & LUM delivery • Tailored to individual customer needs • 3PL Logistics • Healthcare focused / FDA compliant • Pandemic pre
Slide 50: Optimizing Inventory Management
Optimizing Inventory Management Leveraging Technology for Best-in-Class Service Distribution only service Supply chain services S E R V I C E S
Slide 51: Enhancing Order Visibility Through QSight
Confidential & Proprietary to Owens & Minor Inc. Enhancing Order Visibility Through QSight • Point & Click Integrated Quality & Inventory Management at Point of Use • Integrates into leading EMR systems
Slide 52: Video
Confidential & Proprietary to Owens & Minor Inc. Video
Slide 53: Igniting Sustainable Growth in Global Solutions: 2020-2026
Confidential & Proprietary to Owens & Minor Inc. Diversifying into new channels and adjacent markets • Exploit Outsourced Logistics capabilities to meet market needs • Support customer migration into new arenas – e.g., ASCs, post-acute care Broadening proprietary product / service portfolio • Expand
Slide 54: Investing for the Future
Confidential & Proprietary to Owens & Minor Inc. Investing for the Future Expanding Capacity • Investing in Infrastructure • Integrated Service Centers – providing customers with flexible, system-integrated solutions • Incremental Warehouse Capacity – supporting storage of pandemic preparedness item
Slide 55: Deliver More for Our Customers
Confidential & Proprietary to Owens & Minor Inc. Deliver More for Our Customers Broadening Products & Services Portfolios • Expand Services Offering Across OR Spectrum • Services – expand market-leading services across the entire OR spectrum, from scheduling to case cart deployment • Utilize QSight
Slide 56: New Channels and Markets
Confidential & Proprietary to Owens & Minor Inc. New Channels and Markets • Exploit Outsourced Logistics Capabilities • Healthcare supply chain management is more critical, and more complex, than ever before • O&M is uniquely positioned to integrate distribution supply, logistics support and data an
Slide 57: Global Solutions 2020-2026 Revenue Target
Confidential & Proprietary to Owens & Minor Inc. Global Solutions 2020-2026 Revenue Target* Key Assumptions • Growth supported by strong pipeline of Proprietary Products through O&M Channel • Adjacent market expansion in Patient Direct business • Disciplined Infrastructure Investment leading to oper
Slide 58: The Customer: Patient Direct
THE CUSTOMER: PATIENT DIRECT Perry Bernocchi CEO, Byram Healthcare
Slide 59: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 60: Covering the Entire Patient Journey
Confidential & Proprietary to Owens & Minor Inc. HOSPITAL/IDN HOME HEALTH CHRONIC CARE AT HOME Covering the Entire Patient Journey Completing the Continuum of Care
Slide 61: Patient Direct Market Dynamics
Confidential & Proprietary to Owens & Minor Inc. Patient Direct Market Dynamics Aging Population: 10,000 people per day turn 65 years old Over 60 million Medicare beneficiaries in the U.S. Rise in chronic conditions requiring regular care via direct-to-patient and home health agencies Home setting i
Slide 62: Alternate Care Market Overview
Confidential & Proprietary to Owens & Minor Inc. Chronic Care at Home (DME Soft Goods) DME (Respiratory Equipment) Cash / Retail Medications/ Pharmacy mHealth / Remote Monitoring LTC / SNFs / Rehabs / Sub- Acute Care Facilities Home Health & Hospice Byram also competes in the Home Health Agency Mark
Slide 63: Market Leading National Presence Keeping Patients Healthy at Home
Confidential & Proprietary to Owens & Minor Inc. YOUR TITLE YOUR TITLEYOUR TITLE Market Leading National Presence Keeping Patients Healthy at Home Through our Byram Healthcare business, Owens & Minor improves health outcomes and affordability of care for people living with chronic conditions ~35K Ne
Slide 64: Leading, National Provider of Direct to Home Healthcare Services
Confidential & Proprietary to Owens & Minor Inc. Leading, National Provider of Direct to Home Healthcare Services National Footprint, Local Presence National Scale Strong Local Presence Specialized Centers of Excellence Within 48 Hours of Delivery Anywhere in the U.S.
Slide 65: Differentiators Within the Patient-Direct Channel
Confidential & Proprietary to Owens & Minor Inc. Differentiators Within the Patient-Direct Channel Product and Reimbursement Expertise through Specialized Centers of Excellence Unrivaled Managed Care Contracts…650+ with over 2,000 plan designs Nationwide Network to Optimize Shipping Distance and Tim
Slide 66: What We Do
Confidential & Proprietary to Owens & Minor Inc. What We Do Innovative Products for Every Care Setting A leading healthcare service provider that bills third party insurance on behalf of the patient We deliver healthcare supplies across a broad range of medical conditions direct to their home We pro
Slide 67: Video
Confidential & Proprietary to Owens & Minor Inc. Video
Slide 68: Providing Self-Care in the Home
Confidential & Proprietary to Owens & Minor Inc. Patient Home Delivery Distribution / Communication Specialized Centers of Excellence New Referral / Customer Capture • E-prescribe • Web Order Form • Email • Fax • Phone • OEM • 98% Average Order Line Fill Rate • Shipment Notification • Order In-Take
Slide 69: Delivering Excellence through Business Discipline
Confidential & Proprietary to Owens & Minor Inc. Delivering Excellence through Business Discipline # Leading Choice in Chronic Health Segments 1. Verywell Health 2021 2. Manufacturer consumption data 3. Playmaker Claims Data Q3 2020 4. CMS Medicare Claims Data 2019 #1 Rated Diabetes Supplier1 #1 CGM
Slide 70: Providing Superior Care at Home
Confidential & Proprietary to Owens & Minor Inc. WOUND CAREDIABETES Providing Superior Care at Home One Source Total Solution Advanced Wound Dressings UROLOGY Largest Selections from Leading Brands OSTOMY Largest Provider of Supplies BREAST PUMPS Full Range of Leading Brands INCONTINENCE CARE Improv
Slide 71: Video
Confidential & Proprietary to Owens & Minor Inc. Video
Slide 72: Patient Direct Market Outlook
Confidential & Proprietary to Owens & Minor Inc. Patient Direct Market Outlook US Market Size and Growth (Addressable Market) Segment Market Size ($M) Market CAGR (‘21-23) Byram CAGR (‘21-23) Byram vs. Market Ostomy 800 2% 6% Wound Care 635 4% 19% Urology 1,300 4% 8% Diabetes 3,700 9% 12% Incontinen
Slide 73: Igniting Sustainable Growth in Home Health: 2020-2026
Confidential & Proprietary to Owens & Minor Inc. Diversifying into adjacent markets • Increase customer value through cross sell opportunities and enter new therapy verticals • Leverage data solutions for manufacturers and technology solutions for high- risk populations Broadening proprietary produc
Slide 74: Expanding Capacity
Confidential & Proprietary to Owens & Minor Inc. Expanding Capacity Technology Investments for Easy Ordering Process Flow Improvements Enhanced Customer Experience 1 2 3 • Mobile App • Mybyram Personal Web portal • Text, IVR, e-Mail • B2B Web Order Portals • Reduce Cycle Times • Streamline Order to
Slide 75: Broadening Portfolio / Service Expansion
Confidential & Proprietary to Owens & Minor Inc. Leverage Contract Portfolio & Reimbursement Expertise Leverage O&M Distribution Footprint IDN-Affiliated Home Health Agency Pull Through Broadening Portfolio / Service Expansion New Global Products Flow Through
Slide 76: New Channels & Markets
Confidential & Proprietary to Owens & Minor Inc. New Channels & Markets Digital Health (mHealth) Services Healogics / Restorix Partnerships Cash e-Commerce New Therapy Verticals Investments in Priority Markets
Slide 77: Byram Patient Direct 2026 Revenue Target
Confidential & Proprietary to Owens & Minor Inc. Byram Patient Direct 2026 Revenue Target Key Assumptions • Investments – expanded sales force, digital marketing, transactional technology • Continued growth in Diabetes category and acceleration in other categories • Rapidly aging population; 10,000
Slide 78: The Customer: Enterprise
THE CUSTOMER: ENTERPRISE Mark Zacur EVP, Chief Commercial Officer
Slide 79: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 80: Commercial Structure
Confidential & Proprietary to Owens & Minor Inc. Commercial Structure Customer Enterprise Strategic partner driving collaboration, value capture, and profitability Distribution • Operational excellence • Supply chain optimization • Supplier partnership • Daily customer success Global Products • Tech
Slide 81: Delivering Operational Excellence
Confidential & Proprietary to Owens & Minor Inc. Delivering Operational Excellence Intense Focus on the Fundamentals Wins the Right for a More Strategic Partnership Right Product Right Time Right Place O&M leads the industry in ensuring that clinicians can focus on the patient without worrying about
Slide 82: Delivering Full Suite of Products & Services Across Continuum of Care
Confidential & Proprietary to Owens & Minor Inc. Proprietary Products Value-Added Services Branded Products Medical Distribution Alternate Site / Non-Acute Post-AcuteAcute Care Halyard MediChoice Kits and Trays Inventory Management Unitized Delivery Broad Product Portfolio Preferred Brands Home Heal
Slide 83: Expand Proprietary Penetration via Process Mindset
Confidential & Proprietary to Owens & Minor Inc. • Pre-launch / sales team product intro • Communicate launch timeline WEEKS 1 - 2 • Launch sales support tools • Sales talk track refinement • Early feedback on top targets WEEKS 4 - 8 • Follow-up on top targets • Launch direct email campaign • Produc
Slide 84: Customer testimonial: OHSU
Confidential & Proprietary to Owens & Minor Inc. I am proud of O&M and how it responded to this pandemic. The professionalism and care you have shown is something that you should be very proud of. Our collaboration has allowed OHSU (Oregon Health & Science University) to do some amazing things to en
Slide 85: Customer testimonial: Kindred Healthcare
Confidential & Proprietary to Owens & Minor Inc. Of course the COVID pandemic has challenged all aspects of the global supply chain; as a provider of long-term acute and intense rehabilitative services, we have certainly felt the impact of PPE allocations, increased patient census and acuity beyond
Slide 86: Video
Confidential & Proprietary to Owens & Minor Inc. Video
Slide 87: The O&M Difference
THE O&M DIFFERENCE Empowering Our Customers To Advance Healthcare™ Distribution W E A R E O W E N S & M I N O R Values Supplier Diversity Reliability Flexibility Scalability Service Resiliency Innovation Transparency Sustainability Visibility THE CUSTOMER
Slide 88: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 89: The Team: ESG
THE TEAM: ESG Shana Neal EVP, Chief Human Resources Officer
Slide 90: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 91: Teammates Are at the Heart of Everything We Do
Confidential & Proprietary to Owens & Minor Inc. Teammates Are at the Heart of Everything We Do Our Teammates: We are Better Together +15K Teammates 6,300 In U.S. 70 Countries Represented 38% Female Teammates in Management Roles 42% VP Level New Hires in 2020 were Female 57% VP Level New Hires in 20
Slide 92: Mission and Values
Confidential & Proprietary to Owens & Minor Inc. Mission Values INTEGRITY: Act with the highest standards of ethics. Honor commitments. EXCELLENCE: Perform to the highest standards. Embrace our Mission of Empowering Our Customers to Advance Healthcare into the future. LISTENING: Listen to our custom
Slide 93: Ensuring the Health and Safety of Our Teammates
Confidential & Proprietary to Owens & Minor Inc. Ensuring the Health and Safety of Our Teammates COVID-19 Response Training for Proper Use of PPE Work Practices to Reduce Exposure Modified Product Delivery Methods Adjusted Policies to Protect Teams Testing & Immunizations
Slide 94: Our Commitment to ESG Means Doing Business the Right Way
Confidential & Proprietary to Owens & Minor Inc. Our Commitment to ESG Means Doing Business the Right Way Driving Sustainable Value Through ESG Initiatives Reusable delivery totes Rechargeable battery systems Recycling programs Low energy lighting Motion-triggered lighting Insulated dock doors Measu
Slide 95: Teammate Safety is the Foundation of Our Success
Confidential & Proprietary to Owens & Minor Inc. Teammate Safety is the Foundation of Our Success Significantly Lower Workers’ Compensation Claims Prioritizing a Culture of Safety Total Compensation Claims Reduced by 37% since 2018 Safety Is Always the First Decision We Make Productivity Safety Qual
Slide 96: Our Diversity & Inclusion Journey
Confidential & Proprietary to Owens & Minor Inc. 2019 • Established internal team to drive process • Conducted focus groups with key constituencies • Identified areas for improvement and enhancement SET THE VISION 2020 • Teammate Resource Groups (TRGs) Black Heritage Outreach LGBTQ Women’s Women in
Slide 97: Supplier Diversity & Inclusion: Uniting Purpose & Product
Confidential & Proprietary to Owens & Minor Inc. 32% of MediChoice Brand Sourced from Diverse Suppliers Supplier Diversity & Inclusion: Uniting Purpose & Product Building Community: Actively Cultivating Relationships Supporting and saluting engagement of local businesses Only 3% of U.S. Corporations
Slide 98: Unwavering Commitment to Service and Community
Confidential & Proprietary to Owens & Minor Inc. Unwavering Commitment to Service and Community Mission and Values in Action Oregon Wildfires & Evacuations • Proactive Response Team • Worked with all PeaceHealth accounts serviced out of Oregon to send double orders to ensure first responders had ext
Slide 99: Impactful Investments to Shape Our Communities
Confidential & Proprietary to Owens & Minor Inc. Environment: Environmentally aware investments Launching the Owens & Minor Foundation Diversity: Diversity driven investments Healthcare: Healthcare focused investments Impactful Investments to Shape Our Communities Committed Capital Value of $10M
Slide 100: Commitment to Corporate Integrity
Confidential & Proprietary to Owens & Minor Inc. Commitment to Corporate Integrity Female Board Directors Ethnically Diverse Directors • Commitment to a representative workforce and leadership team • Separate Chairman and CEO Roles and Responsibilities • Independent Directors • Highest ethical stand
Slide 101: The Path: Financial Review
THE PATH: FINANCIAL REVIEW Andy Long EVP, Chief Financial Officer
Slide 102: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 103: Strategic Priorities: Taking Control of Our Own Destiny
Confidential & Proprietary to Owens & Minor Inc. Strategic Priorities: Taking Control of Our Own Destiny Harness multi-year rebuild of core business disciplines, culture, processes LEVERAGE THE FOUNDATION Continue deleveraging momentum and utilize balance sheet to drive growth UTILIZE FINANCIAL STRE
Slide 104: Where We Were…and Where We Are Today
Confidential & Proprietary to Owens & Minor Inc. Where We Were…and Where We Are Today As of December 31, 2018 • Declining Adjusted EBITDA • Diminished cash balance • Unsustainable debt levels • Red flag level Total debt / Adjusted EBITDA • Downgraded to as low as CCC+ rating As of March 31, 2021 • I
Slide 105: Strategic Plan Builds Financial Strength
Confidential & Proprietary to Owens & Minor Inc. UTILIZE FINANCIAL STRENGTH Strategic Plan Builds Financial Strength * Financial Strength Drivers • Reduced $700M+ of debt since Q2 2018 • Eliminated $39M in short-term maturities during Q1 2021 • Improved Credit Rating from CCC+ as of December 2018 to
Slide 106: Strategic Plan Drives Margin & Profitability Expansion
Confidential & Proprietary to Owens & Minor Inc. UTILIZE FINANCIAL STRENGTH Strategic Plan Drives Margin & Profitability Expansion 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% Margin Drivers • Ongoing Operational Excellence • Capacity expansions in higher growth, higher margin opportunities • Patient Dire
Slide 107: Strategic Plan Drives Margin & Profitability Expansion
Confidential & Proprietary to Owens & Minor Inc. UTILIZE FINANCIAL STRENGTH Strategic Plan Drives Margin & Profitability Expansion Sustainable Growth Drivers • Elective procedures coming back (5M+ delayed in 2020) • Capacity expansion • Proprietary product expansion • New Vertical expansion • Upside
Slide 108: Defining the New Normal
Confidential & Proprietary to Owens & Minor Inc. Defining the New Normal With the resurgence of elective procedures and the rising demand for PPE in new industries, considerable opportunities for growth exist beyond COVID-enhanced levels PPE Demand Forever Changed Surge abates, but normalized levels
Slide 109: Building Blocks of Revenue Growth Target
Confidential & Proprietary to Owens & Minor Inc. Building Blocks of Revenue Growth Target $8.5B $12B+ Potential M&A Upside * 6-year CAGR from 2020-2026 2020 2026Market Growth PPE Volume Rationalization Proprietary Portfolio Expansion Patient Direct Growth New Adjacent Markets IGNITE SUSTAINABLE GROW
Slide 110: Numerous Opportunities within Core, Products & Adjacencies
Confidential & Proprietary to Owens & Minor Inc. IGNITE SUSTAINABLE GROWTH Numerous Opportunities within Core, Products & Adjacencies to Complement Growth Accelerates Path to Own Continuum of Care M&A Criteria: Bolt-on Approach to Enhance Growth Bolt-on in Terms of Size Focus Niche Market Leadership
Slide 111: Deploying a Disciplined Capital Approach
Confidential & Proprietary to Owens & Minor Inc. Deploying a Disciplined Capital Approach Long-Term Organic Growth Invest in our capacity expansion, people, products and processes Build Very Strong Balance Sheet Reduce long-term debt obligations, increase cash generation capabilities, and build true
Slide 112: Robust 2026 Targets
Confidential & Proprietary to Owens & Minor Inc. Robust 2026 Targets Revenue $8.5B $12B+ Adjusted EBITDA1 $335M $650M+ Adjusted EPS1 $2.26 $6.00+ $4.00 6% CAGR* 12% CAGR* 18% CAGR* $9.8B $475M *6-year CAGR from 2020-2026 2021E Represents mid-point of guidance provided on May 5, 2021 ¹Reconciliations
Slide 113: Ed Pesicka, President & Chief Executive Officer
Confidential & Proprietary to Owens & Minor Inc. Ed Pesicka President & Chief Executive Officer
Slide 114: Unique Ability to Quickly Deliver Critical Products Everywhere
Confidential & Proprietary to Owens & Minor Inc. Unique Ability to Quickly Deliver Critical Products Everywhere Our value chain delivers benefits to our customers: We control the materials, design, strict quality standards, and product specifications in our own facilities with our own Teammates We s
Slide 115: Strategic Priorities: Taking Control of Our Own Destiny
Confidential & Proprietary to Owens & Minor Inc. Strategic Priorities: Taking Control of Our Own Destiny Harness multi-year rebuild of core business disciplines, culture, processes LEVERAGE THE FOUNDATION Continue deleveraging momentum and utilize balance sheet to drive growth UTILIZE FINANCIAL STRE
Slide 116: Investment Highlights
Confidential & Proprietary to Owens & Minor Inc. Investment Highlights 1. Leading healthcare solutions company ready to ignite sustainable growth through capacity and proprietary products expansion, entry into new adjacent markets, and future M&A 2. Medical distribution with 140-year history of serv
Slide 117: Q&A
Confidential & Proprietary to Owens & Minor Inc. Q&A
Slide 118: Today's Agenda: Through the O&M Value Chain
Today’s Agenda: Through the O&M Value Chain The New Owens & Minor1 The Products: Global Products2 The Backbone: Medical Distribution3 The Customer: Patient Direct4 The Customer: Enterprise5 Break6 The Team: ESG7 The Path: Financial Review8 Q&A9 RAW MATERIALSDESIGN MANUFACTURING DISTRIBUTION DELIVERY
Slide 119: Appendix
Confidential & Proprietary to Owens & Minor Inc. Appendix
Slide 120: Use of Non-GAAP Measures
Confidential & Proprietary to Owens & Minor Inc. Use of Non-GAAP Measures This presentation contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles ("GAAP"). In general, the measures exclude items and charges that (i) management does not b
Slide 121: Continuing Operations Adjusted EBITDA Reconciliation
Confidential & Proprietary to Owens & Minor Inc. Continuing Operations Adjusted EBITDA Reconciliation Certain totals in this appendix may not sum due to rounding $ in millions YTD YTD YTD YTD YTD YTD Continuing Operations Adjusted EBITDA Reconciliation 2020 2019 2018 2017 2016 2015 Net income (loss)
Slide 122: Total Company Adjusted EBITDA Reconciliation
Confidential & Proprietary to Owens & Minor Inc. Total Company Adjusted EBITDA Reconciliation $ in millions Q1 QTD YTD YTD YTD YTD YTD Adjusted EBITDA (Adj. EBITDA) Reconciliation 2021 2020 2019 2018 2017 2016 Net income (loss), as reported (GAAP) $ 69.6 $ 29.9 $ (62.4) $ (437.0) $ 72.8 $ 108.8 Loss
Slide 123: Total Company FCF Reconciliation
Confidential & Proprietary to Owens & Minor Inc. Total Company FCF Reconciliation ¹Includes LIFO provision of $40.3M, $15.6M, $7.9M, $26.9M, $4.4M, and $(0.8M) for the periods ending Q1 2021, 2020, 2019, 2018, 2017, and 2016. The 2018 figure includes acquired current assets of $331M and current liab
Slide 124: Total Company Net Debt Reconciliation
Confidential & Proprietary to Owens & Minor Inc. Total Company Net Debt Reconciliation Continuing Operations Adjusted EBITDA Reconciliation $ in millions Q1 QTD YTD YTD YTD YTD YTD Net Debt Reconciliation 2021 2020 2019 2018 2017 2016 Total Company Debt, as reported (GAAP) $ 982.4 $ 1,026.0 $ 1,563.
Slide 125: Adjusted EPS Reconciliation
Confidential & Proprietary to Owens & Minor Inc. Adjusted EPS Reconciliation YTD Adjusted EPS Reconciliation 2020 Income from continuing operations per diluted common share, as reported (GAAP) $ 1.39 Intangible amortization 0.47 Acquisition-related and exit and realignment charges 0.44 Loss on extin
Slide 126: Definitions of Non-GAAP Reconciliation items
Confidential & Proprietary to Owens & Minor Inc. Definitions of Non-GAAP Reconciliation items The following items have been excluded in our non-GAAP financial measures: Intangible amortization: Includes amortization of intangible assets established during purchase accounting for business combination