Medicover Ab Class B · OMXSTO:MCOV_B
Medicover Ab Class B — Investor Day (February 2023)
105 slides from Medicover Ab Class B's investor day presentation, Feb 17, 2023
Slide 1: €2.2bn and beyond by 2025
€2.2BN AND BEYOND BY 2025 Medicover Capital Markets Day 17 February 2023
Slide 2: Disclaimer regarding forward-looking statements
DISCLAIMER REGARDING FORWARD-LOOKING STATEMENTS This presentation may contain certain forward-looking statements and opinions. Forward-looking statements are statements that do not relate to historical facts and events and such statements and opinions pertaining to the future that, by example, conta
Slide 3: Agenda
11:30 Fredrik Rågmark, CEO Agenda Strategic focus 12:00 Staffan Ternström, COO Diagnostic Services Strategic deep dive – Diagnostic Services 13:00 Q&A Diagnostics Services 13:15 Lunch 13:45 John Stubbington, COO Healthcare Services Strategic deep dive – Healthcare Services 14:45 Q&A Healthcare Servi
Slide 4: Strategic roadmap
Strategic roadmap Fredrik Rågmark Chief Executive Officer, Medicover Part of Medicover since 1995 PREVIOUS EXPERIENCE ▪ Managing Director, Oresa Ventures ▪ Business Development Manager, Oriflame Eastern Europe 4
Slide 5: High cash generation enabling reinvestment for persistent organic growth
High cash generation enabling reinvestment for persistent organic growth Organic revenue growth Cash generation Operational milestones €m Operating cash flow before working capital changes 2017 Entering India market and maintenance Capex (€m) ▪ 23 hospitals, 343.2 1,510.2 ▪ 4,4k hospital beds Operat
Slide 6: Financial progress reflecting our previous targets
Financial progress reflecting our previous targets … enabling solid capital structure despite Continuously delivering revenue growth … … with a strong EBITDA generation … high investment activity Revenue (€m) Adjusted EBITDA (€m)1 Leverage Target leverage ≤3.5 times Adj. EBITDA Adj. EBITDA margin 40
Slide 7: A specialised provider of diagnostic and healthcare services
A specialised provider of diagnostic and healthcare services Healthcare Diagnostic Services 60% Services 40% 175 Clinics 104 Laboratories 126 Gyms Other John Staffan Stubbington Ukraine Ternström 9% 4% 41 Hospitals 876 Blood-drawing 5.8K Hospital beds India 11% points (BDPs), 27 Clinics 43% Poland 2
Slide 8: Clear strategic roadmap and solid position for continued profitable organic growth
Clear strategic roadmap and solid position for continued profitable organic growth 8
Slide 9: Expected growth of health expenditure in key markets
Expected growth of health expenditure in key markets Health expenditure per capita Government/ compulsory Voluntary/ Out-of-pocket Share of GDP € % GDP 9 000 10% 8 000 9% 7 000 8% 7% 6 000 6% 5 000 5% 4 000 4% 3 000 3% 2 000 2% 1 000 1% 0 0% Greece Norway Denmark Ireland Austria Belgium France Malta
Slide 10: As these economies grow, their expenditure on healthcare grows even faster
As these economies grow, their expenditure on healthcare grows even faster Poland 2030 Poland 2020 Poland 2012 India 2030 India 2020 India 2012 10 Source: McKinsey based on EIU data, Medicover calculations
Slide 11: Case study on the Polish market – large space to grow
Case study on the Polish market – large space to grow GDP per capita in Poland Health expenditures Private healthcare market Private healthcare market (€k) as a share of GDP (%) structure (%) by geography (%) by wealth (%) Wealth quintile Structured FFS Geography groups 17.9 5.6% 5.4% 18% 29% 32% 23
Slide 12: Strategic focus in brief
Strategic focus in brief Retain and grow the Expand service offering Pursue customer base operational excellence Selective M&A Digitalisation 12
Slide 13: Medicover's strategy
Medicover’s strategy Retain and grow the customer base Expand service offering Pursue operational excellence ▪ Invest in geographical coverage ▪ Expand in existing and select new markets ▪ Leverage procurement savings (diagnostics and healthcare provision) (organically and by acquisitions) (economy
Slide 14: Selective and strategic M&A agenda – Polish Dental example
Selective and strategic M&A agenda – Polish Dental example Track record Financial contribution Strict investment criteria 17 acquisitions completed in Poland of acquired dental clinics1 No of clinics 1 Min. 5-6 dental chairs 33 36 28 Revenue impact: 21 2 > €20k revenue per seat 5 8 €35.7m 49% of Pol
Slide 15: Strategic M&A agenda creating value – Medicover Hospitals India example
Strategic M&A agenda creating value – Medicover Hospitals India example Capital invested Presence established Value created 23 modern hospitals Revenue (€m) 4,4k hospital beds (strong coverage of 3 states) 161.2 130.8 79.1 2022 statistics: €119.1m1 9.8m outpatient services cash invested 180k inpatie
Slide 16: Digitalisation
Digitalisation ▪ Develop digital sales channels to reach more customers and increase share of their spend ▪ Use telehealth to increase accessibility and leverage physical infrastructure ▪ Increase use of AI to manage patient flow and support decision making ▪ Monetise Medicover’s accumulated informa
Slide 17: Medicover's Sustainability framework
Medicover’s Sustainability framework ▪ Medicover’s Mission, to improve and sustain health and wellbeing, is at the heart of our Sustainability Framework. ▪ All dimensions of Sustainability are important. But Medicover is ideally positioned to contribute to UNSDG #3 Good Health and Wellbeing for All
Slide 18: A Highly Positive Net Impact on the World
A Highly Positive Net Impact on the World Medicover’s Net Impact Ratio: +75% ▪ The Upright Project(1) uses AI to evaluate companies by scoring their positive and negative impacts on the world. ▪ This science-based evaluation has been applied to more than 20,000 companies covering more than 95% of gl
Slide 19: Great place to work
Great place to work Organisation snapshot Value driven employee Workforce evolution has been following dynamic business growth ▪ Strong sense of purpose at work +183% Our mission ▪ Work impacting health and life of others ▪ Strong retention and attraction component 44.7 38.6 32.4 28.8 21.0 15.8 ▪ Va
Slide 20: Driving the business through technology
Driving the business through technology 2012–2015 2005 2006 Remote consultations 2015 2017 2020 On-line visits Electronic medical (chat, phone, video) e-Commerce First DaVinci Remote services scheduling record platform robotic surgery boost (Covid-19) 2005 2010 2015 2020 2005 2008 2013 2017 2020 202
Slide 21: Financial targets 2025
Financial targets 2025 Revenue, €m Adjusted EBITDA (organic), €m Leverage 2 200 350 1 510 234 ≤3.5x Can exceed over shorter periods Dividend policy, 2022 2025 target 2022 2025 target share of net profit Organic revenue exceeding Organic adjusted EBITDA <50% in excess of €2.2bn €350m 21
Slide 22: Staffan Ternström
Staffan Ternström COO Diagnostic Services Part of Medicover since 2021 PREVIOUS EXPERIENCE ▪ President and CEO Handicare Group ▪ Executive VP for Global Commercial Operations & Strategy at Mölnlycke Health Care AB ▪ Several senior Executive positions at Johnson & Johnson 22
Slide 23: Diagnostic Services at a glance
Diagnostic Revenue, €m Services at Business as usual Covid-19 impact a glance 179 106 66 876 Blood-drawing points* 304 337 409 407 507 507 261 2016 2017 2018 2019 2020 2021 2022 104 laboratories* Adjusted EBITDA, €m Business as usual 119 million tests Covid-19 impact 74 41 21 10,429 76 70 108 80 co-
Slide 24: Robust and diversified revenue profile
Robust and diversified revenue profile Attractive private pay revenue with Geographically well- Growing opportunity stable public payments in Germany diversified revenue structure in advanced testing Volume vs revenue of advanced tests – 2022 (excl. Covid-19) 95,9% 64,6% Standard tests Others 35,4%
Slide 25: Operating two different go-to-market models in our geographies
Operating two different go-to-market models in our geographies Reimbursment model Fee-for-service model Patient Patient Patients go to their physicians who refer to BDP or Patients go to their physicians go directly to BDP which collects blood samples who collect blood samples Physician / Specialist
Slide 26: Diagnostics is moving forward to establish base for new value drivers
Diagnostics is moving forward to establish base for new value drivers in pre- & post-analytics New value drivers New value drivers ■ Data analytics Conventional value drivers ■ Prevention & monitoring services ■ Point of care and self-testing kits - capillary and swabs ■ Counselling (e.g. Genetics)
Slide 27: Market size and drivers
Market size and drivers European in vitro diagnostic Increased focus on prevention (IVD) market, €bn and early detection 34 29 24 29 22 23 25 Rising health awareness and wellness needs 2017 2018 2019 2020 2021 2022 2023E Digitalisation of consumers / patients and health providers IVD spendings 13% …
Slide 28: Large space to grow in the coming years
Large space to grow in the coming years Retain and grow the customer base Expand service offering Selective M&A Pursue operational excellence Grow through digitalisation 28
Slide 29: Leverage strong core to expand into attractive growth areas
Leverage strong core to expand into attractive growth areas Central & Eastern Europe Germany Growing markets Stable and profitable with high potential, market, well funded mainly private pay Genetics Medicover Integrated Clinical Services (MICS) High growth market with synergetic fit to the core Eff
Slide 30: Continuing to outgrow a profitable and well funded market in Germany
Continuing to outgrow a profitable and well funded market in Germany Germany – Network Reach Market* (€bn) & Medicover** (€m) Size Development 3 2 #5 Player in the national 1 lab market 12,7 15,0 2 1 5 7 10,2 10,5 10,9 11,4 12,3 1 1 2 >25% 2016 2017 2018 2019 2020 2021 2022 4 Lab market share in our
Slide 31: Clear strategies to expand market share and share of wallet across Germany
Clear strategies to expand market share and share of wallet with sustained profits across Germany Drive Efficiency and Integration Integration of systems and Automation and Digitalisation of clinic processes to unlock improvement of lab processes and portfolio network synergies procedures and machin
Slide 32: Advanced and holistic diagnostic service to international customers via Germany
Advanced and holistic diagnostic service to international customers via Germany Our portfolio offers more than 8,000 parameters ranging from routine blood tests to highly advanced diagnostics, covering all major clinical pathology areas and advanced tests. Partner labs External labs Internal client
Slide 33: Leading positions in attractive regions with strong potential for further expansion
Leading positions in attractive regions with strong potential for further expansion FFS Markets – Network Reach (2022) Significantly outgrowing the markets 2022 Revenue (€m) 34 144 81 Labs 806 BDPs #1 in Romania 2016-2022 CAGRs*: Medicover Market 13% 6 317 #1 in Ukraine 3 66.0 35 5% 5 22 168 #3 in P
Slide 34: A targeted approach to capture the full FFS potential in Eastern European markets
A targeted approach to capture the full FFS potential in Eastern European markets Fee-For-Service Model ▪ Highest brand awareness in many FFS markets Patient ▪ Leveraging Medicover Healthcare, telehealth and at-home testing as additional sales channels ▪ Doctors are key reference points for FFS cust
Slide 35: Achieving tangible results (example: Romania)
Achieving tangible results (example: Romania) Fee-for-Service Model Patient 86.7 6.8 >40% NPS score in Romania NPS improvement 2022 Top of mind brand (Bucharest region) in 2022 vs 2021 awerness Physician / Specialist 86.0 25k >6k NPS score in Romania Number of doctors that annual visitis by Synevo C
Slide 36: Long track of digital solutions supporting strategic focus in Eastern Europe
Long track of digital solutions supporting strategic focus in Eastern Europe countries Synevo App A two-sided digital platform patient-doctors leveraging the volume of Webshop Mobile solutions data, the significant network of patients and doctors, supporting fast & accurate diagnostics, Continued in
Slide 37: Hub and spoke model allowing for increased margins and staying ahead of competition
Hub and spoke model allowing for increased margins and staying ahead of competition EFFICIENT AND OPTIMISED LAB NETWORK International Labs– IMD Germany, Medicover Genetics (Cyprus and Munich) Advanced lab tests ▪ Division-wide procurement and frame-contracts for all key suppliers ▪ Achieving economi
Slide 38: Currently focusing on re-establishing business and supporting healthcare infrastructure
Currently focusing on re-establishing business and supporting healthcare infrastructure Ukraine – Lab diagnostics network coverage Our current activities ▪ Focusing on returning to stable profits going forward building on 7 4 9 1 20 9 1 63 7 #1 profitable Q3 & Q4 of 2022 ▪ Further re-open BDPs and l
Slide 39: Leverage strong core to expand into attractive growth areas
Leverage strong core to expand into attractive growth areas Central & Germany Eastern Europe Genetics Medicover Integrated Clinical Stable and profitable Growing markets Services (MICS) High growth market with synergetic fit to the core market, well funded with high potential, Attractive opportunity
Slide 40: Genetics is a global high growth market
Genetics is a global high growth market Global genetics market ($Bn) 26,4 50 14,4 Countries sold to 5 2021 2027E Tech transfers completed Market drivers ▪ Increasing demand for predictive testing (e.g. cancer, pre- and post-natal screening) MCOV Genetics presence (labs, clinics or sales force) ▪ Pha
Slide 41: Genetics lab-as-a-service enable sales growth from clients across the globe
Genetics lab-as-a-service enable sales growth from clients across the globe ▪ Acquisition of a second sequencing hub with NIPD Genetics in Cyprus in early 2022 Sample is shipped to ▪ Unified brand with state-of-the-art website, own production sites in Cyprus or Germany educational and marketing cont
Slide 42: Proprietary tech transfer solutions create long-term customer relations
Proprietary tech transfer solutions create long-term customer relations and stable income Tech transfer Platform provider solutions of CE-IVD kits for genetic testing ▪ Fully automated tech transfer enables ▪ Reagents (CE IVD) for most customer to perform efficient genetic common genetic indications
Slide 43: Leverage capabilities to become a trusted partner for integrated clinical services
Leverage capabilities to become a trusted partner for integrated clinical services Medicover Integrated Clinical Services – Network Coverage MICS STRATEGY: ONE-STOP-SHOP FOR PHARMA & cros Enabled through all existing operational hubs and new ones installed in EU / US (labs, logistics) FIND THE RIGHT
Slide 44: Well-positioned to benefit from the attractive clinical trial market in Europe
Well-positioned to benefit from the attractive clinical trial market in Europe Global clin. Trial Market Size (€bn) Patient recruitment as a key growth lever Europe RoW Focus towards global, 130 Clinical trials studies currently managed esp. US markets with one-stop shop offering – eg. via partnersh
Slide 45: First successful project enables leveraging high growth in companion diagnostics
First successful project enables leveraging high growth in companion diagnostics across development stages Global precision medicine market size (€bn) Engaging along the entire process Services provided by medicover to the pharmaceutical industry 104 PRE-CLINICAL PHASE I PHASE II PIVOTAL NDA FILING
Slide 46: Continued growth in core markets and expansion in Genetics and MICS
Continued growth in core markets and expansion in Genetics and MICS as contributors to 2025 targets Central & Eastern Europe Germany Growing markets Stable and profitable with high potential, market, well funded mainly private pay Genetics MICS High growth market with Attractive opportunity to serve
Slide 47: John Stubbington
John Stubbington COO Healthcare Services Medicover Part of Medicover since 2010 PREVIOUS EXPERIENCE ▪ 18 years at BUPA, of which 9 years in International Arm 47
Slide 48: Healthcare Services at a glance
Healthcare Revenue, €m Services at a 917.1 glance 711.6 539.7 449.3 Norway Sweden(1) 346.1 285.8 3.8 x growth since IPO(2) 244.7 Denmark 2016 2017 2018 2019 2020 2021 2022 Poland Germany 6 sub-divisions Ukraine Hungary Adjusted EBITDA, €m Romania 8 countries 128.8 112.7 >1.7m members 61.6 85.4 43.3
Slide 49: Well-balanced service portfolio
Well-balanced service portfolio Revenue breakdown by sub-divisions Revenue breakdown by payor Revenue breakdown by country Business Funded Services Poland 38% 32% 65% Public pay 13% Revenue Hospital Revenue Revenue 19% Services €917.1m €917.1m €917.1m 14% 18% India Consumer services 18% 7% 10% 10% (
Slide 50: Healthcare services has lots of opportunities to grow
Healthcare services has lots of opportunities to grow Poland India Romania Early position markets Business Services: Hospital Services Ambulatory Services Early position in Germany – Europe’s B2B healthcare and B2B sport services Network of private hospitals Network of premium clinics largest dental
Slide 51: Solid market growth across key geographies
Solid market growth across key geographies Private Healthcare Spend (€ per Capita) Poland 250 Good health more important than ever 124 2016 2017 2018 2019 2020 2021 2022E 2023E 2024E 2025E 2026E 2027E Mix of physical and remote care delivery Romania 195 Challenged public healthcare provision 94 Grow
Slide 52: Fully integrated and highly complementary business model driving out of pocket fee-for-service
Fully integrated and highly complementary business model driving out of pocket fee-for-service Fund rising and building memberships Service management Care provision Fund raising offered… Consumer proposition Ambulatory Medical Sport Sport Plans for coverage coverage individuals for groups for group
Slide 53: Large space to grow in the coming years
Large space to grow in the coming years Retain and grow the customer base Expand service offering Selective M&A Pursue operational excellence Grow through digitalisation 53
Slide 54: Poland
Poland ▪ Holistic and fully integrated B2B healthcare model ▪ Sports offering ▪ Strong positions in highly attractive hospital and FFS market ▪ Solid position in dental, the largest segment of private healthcare ▪ Leading fertility services provider
Slide 55: Highly attractive healthcare market in Poland
Highly attractive healthcare market in Poland Polish healthcare market development (€bn) Key growth drivers Out of pocket ▪ Already large healthcare market in Poland Structured ▪ Aging population 6.5 6.7 6.0 5.3 5.9 1.3 5.2 1.5 ▪ Growing importance of healthcare after pandemic 4.7 1.2 1.4 1.0 1.1 1.
Slide 56: Long track-record of successful growth
Long track-record of successful growth Business Services 1995 revenue development Commenced trading as ABC Medicover in Warsaw Growing B2B oriented healthcare services ▪ 2nd largest healthcare provider in Poland ▪ 69 Medicover Clinics in key cities with access to 161 specialised clinics within the G
Slide 57: Business Services driving traffic to other service lines
Business Services driving traffic to other service lines Business Services Dental Gyms & sport Eye-care Clinics Business Services Hospital Members FFS MediStore Ambulatory Hospitals care Fertility Public funding 1. As we expand our B2B footprint 2. We enable more sales to employees Phamacies 3. This
Slide 58: Very good coverage in key geographies
Very good coverage in key geographies Service management and care delivery Very good coverage of key geographies … ▪ Health coverage with focus on Healthy Company strong #2 player, 1.2 million members, holistic approach ▪ Holistic employee benefits provider for HR Healthcare, Sport, Benefits, HR sol
Slide 59: Highly attractive sport market in Poland
Highly attractive sport market in Poland Sport market (€bn) Key growth drivers Gym memberships ▪ Market flat due to Covid-19 and closures B2B Sport cards CAGR 0.0% ▪ There is growing popularity of sport, now also for immunity 1.0 1.0 1.0 0.9 ▪ Employee active lifestyle even more important 0.8 0.8 0.
Slide 60: Highly attractive private hospital market in Poland
Highly attractive private hospital market in Poland Private Inpatient & FFS (€bn) Key growth drivers Inpatient NFZ Inpatient Outpatient ▪ Growing demand for specialist care accelerated by Covid-19 related health problems 11.9 11.2 11.1 10.2 10.1 ▪ Challenged public provision 9.3 waiting time to all
Slide 61: Long track-record of successful growth
Long track-record of successful growth Hospital Services 2009 revenue development Acquired Damiana clinics and hospital Opening of Medicover Hospital in Warsaw 2012 Acquired Rehasport clinics and hospitals 2015 Acquired Allenort Cardiology 2019 Acquired Neomedic Hospitals 2021 Acquired Dom Lekarski
Slide 62: Coverage in key regions enable strong patient inflow
Coverage in key regions enable strong patient inflow Our store and our Focus on attractive regions Members White Label Store providing with synergetic Medicover member base multi distribution of FFS Medicover members with hospital Insurance 3 GENERAL PROCEDURES 2 4 1 Medicover Hospital Services MATE
Slide 63: Highly attractive FFS dental market in Poland
Highly attractive FFS dental market in Poland Dental market dynamics (€bn) Key growth drivers From the Pocket Public ▪ Closing gap between Poland and Western Europe 3.1 ▪ Limited public provision 2.7 0.4 2.0 2.2 0.5 ▪ Growing consumer market of wellbeing and esthetics 2.0 2.1 1.9 0.4 0.4 0.4 0.4 ▪ A
Slide 64: Long track-record of successful growth
Long track-record of successful growth Dental Services 2017 revenue development 1 acquisition Poland and Germany 3 greenfield openings 2018 2017-2022 3 acquisitions 4 greenfield openings 2019 17 acquisitions 5 acquisitions in Poland 7 greenfield openings 2020 2 3 acquisitions acquisitions 5 greenfie
Slide 65: Dental business model
Dental business model Embryonic development of store, loyalty and white label solutions Medicover Dental Services % of membership base who have no dental cover but use on FFS Basis High End FFS customer looking for highly specialised AVAILABLE Membership treatments % of membership base FFS with high
Slide 66: Solid positions in Poland for dental services
Solid positions in Poland for dental services Very good coverage in Poland 1 largest dental provider in Poland and early position in Germany (76 dental clinics, 456 dental chairs) Portfolio of premium brands Poland Germany Strong acquisition agenda (19 completed acquisitions since 2017) Focus on hig
Slide 67: Long track of digital solutions supporting strategic focus – Polish example
Long track of digital solutions supporting strategic focus – Polish example Strategic Retain and grow the customer base Expand service offering Pursue operational excellence focus Digital sales channels Telemedicine & remote services Electronic medical records Mobile solutions Increased distribution
Slide 68: Attract market with high-quality, premium and digitally supported services
Attract market with high-quality, premium and digitally supported services Illustrative Other Optics, Fertility, Gyms, etc. Dental services Hospital and FFS B2B Healthcare and Sports 1. Holistic employee benefit provider 1. Grow hub-spoke hospital 1. Grow dental services coverage in 1. Grow by expan
Slide 69: Romania
Romania Solid geographic coverage through clinics, hospitals, and partners
Slide 70: Highly attractive healthcare market in Romania
Highly attractive healthcare market in Romania Private healthcare market Romania (€bn) Key growth drivers Out of pocket ▪ Growing importance of healthcare Structured ▪ Employee healthcare even more important 2.6 2.2 2.4 2.3 2.4 ▪ Challenged public provision 0.4 2.0 0.4 0.4 1.8 0.3 0.4 0.4 ▪ Favorabl
Slide 71: Solid track record in the Romanian market
Solid track record in the Romanian market Medicover Romania 1995 revenue development First clinic in Romania (acquired by Medicover in 1998) 1995 - 2022 Developing portfolio of premium clinics 40 Medicover Clinics in key cities Acquired local healthcare leaders Medicover becomes majority shareholder
Slide 72: Very good coverage of key geographies
Very good coverage of key geographies X Clinic #3 largest provider in Romania X Hospital 1 40 5 300+ Clinics(1) Hospitals Partners Suceava 1 3 1 Iasi 4 1 B2B and FFS focus Oradea Cluj ▪ serving both companies and individuals 1 ▪ comprehensive benefit plans Bacau 1 1 1 1 2 Timosara Deva Brasov Focsan
Slide 73: Utilise membership to drive traffic to other business lines
Utilise membership to drive traffic to other business lines Being developed Dental Gyms & sport Eye-care Business Services Hospital Ambulatory care Fertility Phamacies 73
Slide 74: Large space to grow in healthcare in Romania
Large space to grow in healthcare in Romania Illustrative Untapped potential – develop provision network to capture new customers Leverage provision to capture new customers within our reach Capture more individual spend from members Keep relation, retain, continue business Current sales Spend from
Slide 75: India
India The top 10 largest and the fastest growing hospital network in India
Slide 76: Highly attractive hospital and FFS market in India
Highly attractive hospital and FFS market in India Healthcare market in India (€bn) Key growth drivers Pharmaceuticals, lab tests, mursing homes, private practices ▪ Insufficient public provision and large private segment Private hospitals long waiting times, limited scope of services 344 Public hos
Slide 77: Significant growth rate in India hospitals
Significant growth rate in India hospitals India Hospitals 2017 revenue development Investment in initial hospital platform (7 MaxCure hospitals) Business perspective (FY 2019) CAGR = 48.0% 2018 Accounting view (Dec 2019(1)) CAGR = 201.9% 161,2 2 hospitals acquired (1 bought shareholding,1 operator
Slide 78: Second largest population with growing affluent segment
Second largest population with growing affluent segment Share of population of 6 clusters Four structural forces can drive India’s (2001-2022P, %) growth going forward 100% 1.5% 2.9% 5.2% Billion people 2.4% 2.6% 2.6% CAGR 10-22 90% 13.7% 17.8% 21.9% Young, urbanising people 80% Rich urban 23.6% CAG
Slide 79: Hub-and-spoke strategy in India
Hub-and-spoke strategy in India Clear focus: Old model New model ▪ Search for underperforming assets (hub hospital capturing patients from regions) (regions having their own new hospitals) ▪ Turnaround experts ▪ Right size and location ▪ Asset deal, lease deal and management contract 3 state strateg
Slide 80: Key healthcare competences
Key healthcare competences Selective acquisitions and turn-around model Ecosystem of 23 4,378 inpatient services Hospitals Operational beds AURANGABAD NASHIK NIZAMABAD KARIMNAGAR SANGAMNER WARANGAL SRIKAKULAM Attractive locations in ▪ Strong presence in 3 states southern eastern India ▪ High density
Slide 81: Digital differentiation – India example
Digital differentiation – India example Capture traffic and monetisation Booking features Website optimisation Marketing apps Searches for cities and Access to doctor’s pre-plan schedule Everyday Call Team Coverage Cost of procedure comparisons Doctors Doctor Listing Single specialisations (C+S) (sp
Slide 82: Large space for growth in India
Large space for growth in India Medicover vs. listed majors No of operational beds Occupancy rate (%) Av. revenue / person (€) Number of Inpatient EBITDA (€m) Apollo Hospitals 9,425 68.0% 2,051 269,898 124.2 Narayana Hrudaja 6,145 32.1% 1,301 114,500 55.9 Medicover Hospitals 4,378 38.4% 995 138,000
Slide 83: Key strategies to grow healthcare in India
Key strategies to grow healthcare in India Illustrative Digitalisation Add-ons New hospitals Mature hospitals Maximise performance Gain maturity Find new Digitalise to expand coverage on existing hospitals on new hospitals attractive add-ons and build loyalty ▪ Focus on most attractive areas ▪ Build
Slide 84: Key summary
Key summary Continuing to grow Business Services through the sports and wellness offering in 1 Poland and capture more individual spending through cross referrals to e.g. Dental Utilise Business Services to drive traffic to other business lines 2 in Romania while growing attractive FFS areas Expand
Slide 85: Cash generation powering reinvestment for growth
Cash generation powering reinvestment for growth For definitions of alternative performance measures used in this presentation please refer to the investor section of www.medicover.com Joe Ryan Chief Financial Officer, Medicover Part of Medicover since 1996 PREVIOUS EXPERIENCE ▪ FCA. Institute of Ch
Slide 86: Medicover AB guidance 2020-2022
2020-2022 Medicover AB guidance 2022 Targets Implied Acquired Equivalent (Feb 2020); outcome before revenue: 20-22 Actual organic Reported 2020-2022 2019 Base growth & acquisitions & EBITDA: Implied + Outcome Excess 3-year 3-year €m margin €m 20-22 €m4 acquired €m €m CAGR CAGR Revenue1 844.4 9% - 12
Slide 87: Persistent high growth
~r MEDICOVER Persistent high growth
Slide 88: Persistent high growth
~r MEDICOVER Persistent —. high growth
Slide 89: Persistent very high growth – 3 year 14.6% organic
Persistent very high growth – 3 year 14.6%1 organic 2014 2015 2016 2017 2018 €365.3m €415.6m €497.3m €580.2m +9.7% +13.8% +19.7% €671.6m +16.7% +15.8% 2019 2021 €844.4m 2022 2020 +25.7% €1,510.2m €1,377.4m €997.8m +18.2% +38.0% +9.6% Ukraine Poland Germany Romania India Other 89 1 3-year CAGR base y
Slide 90: +MHI from '20 & UKR war '22 changed weightings
+MHI from ‘20 & UKR war ‘22 changed weightings 2014 2015 2016 2017 2018 €365.3m €415.6m €497.3m +9.7% €580.2m €671.6m +13.8% +19.7% +16.7% +15.8% 2019 2022 2021 €844.4m 2020 +25.7% €1,510.2m €1,377.4m €997.8m +18.2% +9.6% +38.0% HCS HCS C19 MDS C19 MDS
Slide 91: Inorganic boost to growth
Inorganic boost to growth €m Inorganic growth boost 300 1.6x 2017-2022 EV by country 2017-2022: 200 0.6x €486m (cashflows) & 1.9x 100 2.7x 1.2x 1.4x €682m EV inorganic 0 investment 2017 2018 2019 2020 2021 2022 Full year revenue of year's acquistions ▪ Hospitals Inorganic CF (incl associates) ▪ Dent
Slide 92: Organic capex an engine for growth
Organic capex an engine for growth Reinvestment in growth €m 250 €280m invested 200 organic growth capex 2017-22 150 100 50 0 -50 2017 2018 2019 2020 2021 2022 Organic rev. growth (ex C19) Growth capex 92
Slide 93: Generate cash to reinvest
Generate cash to reinvest Adjusted EBITDAaL & margin Cash after reinvestment €m EBITDAaL 250 Margin 25% Maintenance capex Maintenance capex 200 20% €m Growth capex Growth capex 150 15% 350 350 "free" Cash generation 7% 7% "free" Cash generation Maintenance % rev. Maintenance % rev. 100 10% 300 300 6
Slide 94: ROIC
ROIC ROIC Rise to norm as digest current wave ▪ ROIC based upon: Earnings - EBITaL + amortisation of acquired assets + impairment 35% of investment + IFRS2 share based cost + expensed M&A costs adjusted for notional tax of 25% 30% ▪ Capital – fixed assets less ROUA, + working 25% capital excluding c
Slide 95: Capital structure
Capital structure Capital structure Strong capital base - Use debt capacity €m 1 000 Capital structure 225 €m 800 1 000 3,5 175 600 900 125 3,0 400 800 200 75 700 2,5 0 25 600 2017 2018 2019 2020 2021 2022 2,0 Equity (cash) Debt net cash Adj EBITDAaL (RH axis) 500 1,5 400 ▪ Debt tenor, long dated 4.
Slide 96: Financial capabilities supporting growth
Financial capabilities supporting growth Cash after reinvestment Inorganic growth boost M2 medical space Strong core business with recurring Ability to invest successfully in adding Scale of operations and utilisation of cashflows and strong markets positioning new infrastructure in existing markets
Slide 97: Financial targets 2025
Financial targets 2025 Equivalent 3- outcome year CAGR Medicover AB 2022 Base 2025 Guidance before before Targets 2023–2025 €m (Feb 2023) inorganic €m acquisitions Revenue (organic) 1,510.2 >13% 2,200 13,4% Adjusted EBITDA 234.2/15.5% >350 >350 >14% Loans payable net of cash and liquid short-term in
Slide 98: Key financial growth enablers
Key financial growth enablers Cash generation to enable further growth Healthy balance sheet Adjusted EBITDAaL & margin Capital Structure €m €m 250 25% 1 000 4 200 20% 800 3 150 15% 600 2 100 10% 400 50 5% 200 1 0 0% 0 0 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 Adj. EBITDAaL Margi
Slide 99: Historic performance gives comfort for further growth
Historic performance gives comfort for further growth ROIC Return on investment 35% ▪ ROIC (before GW) will trend up to norm, 30% circa 15% 25% ▪ Increase as new investments swing from deficit to contribution. 20% ▪ Maturing profile of large scale investments 15% support ROIC increase 10% 5% 0% 2017
Slide 100: Persistent very high growth
Persistent very high growth €m Near-term 700.4 2,200 ▪ Organic capital spend to normalise from the high 2022 levels similar to prior years. ▪ Normalised levels of 2.5% of revenue for maintenance and 4% for growth investment, higher in the first part of 2023 as projects started 1,510.2 47.5 in 2022 a
Slide 101: Grow & strengthen profit measures
Grow & strengthen profit measures €m Near-term 160.5 350 ▪ Margins to continue to be subdued over 2023 as new openings are launched, and maturity of the 138 greenfield units launched in 2022. ▪ Expectation of improvement over 2023 as newer units start to contribute. 234.2 ▪ Foresee Covid-19 to not b
Slide 102: Key summary
Key summary 1 Persistent very high growth 2 Structural need for investment in health infrastructure Proven track-record and ability to invest successfully in adding new infrastructure in 3 existing markets, organic & inorganic 4 Good debt standing, tenor, and pricing 102
Slide 103: Concluding remarks
Concluding remarks Fredrik Rågmark Chief Executive Officer, Medicover Part of Medicover since 1995 PREVIOUS EXPERIENCE ▪ Managing Director, Oresa Ventures ▪ Business Development Manager, Oriflame Eastern Europe 103
Slide 104: €2.2bn organic revenue and beyond by 2025
€2.2bn organic revenue and beyond by 2025 Highly cash generative business model has enabled persistent organic growth and target fulfilment Leading transformation and operational 2025 targets excellence across divisions through digitalisation Stable and persistent cash flows serving as an organic Or
Slide 105: Medicover
oe ~\Vr MEDICOVER CARING FOR YOUR HEALTH IS ALL WE DO