Somnomed Limited · ASX:SOM
Somnomed — H1 2017/18 Earnings Presentation
25 slides from Somnomed's earnings presentation, Feb 19, 2018
Slide 1: Improving lives through better sleep
For personal use only Improving lives through better sleep Investor presentation – First half results 2017/18 and Accelerated Entitlement Offer Not for release or distribution in the United States of America
Slide 2: Disclaimer
Disclaimer For personal use only This document has been prepared as a summary only, and does not contain all information about the Company’s assets and liabilities, financial position and performance, profit and losses and the rights and liabilities attaching to the Company’s securities. This docume
Slide 3: The SomnoMed opportunity is large
The SomnoMed opportunity is large For personal use only There is a significant market for Obstructive Sleep Apnea * The global market for Sleep Apnea devices is Oral Appliance Therapy (OAT*) is equally effective to CPAP particularly in mild to moderate patients and is better tolerated approx. $7-8B
Slide 4: The COAT market is growing at approximately 20% per annum
The COAT™ market is growing at approximately 20% per annum For personal use only There is a high ceiling for COAT™ growth Estimated COAT™ penetration in Western Europe Estimated share of therapy for newly % diagnosed OSA patients in the USA in 100 90 2017* COAT™ share 7% 80 48 70 60 75 70 60 82 93 8
Slide 5: SomnoMed's vision and strategy
SomnoMed’s vision and strategy For personal use only Driving an integrated sleep solutions business Clinical guidelines Simplify patient Clinical and patient Re-imbursement Therapy affordability journey therapy awareness Traditional COAT™ medical device business Managed Care business preferred netwo
Slide 6: Opportunity for direct to consumer model through Renew Sleep Solutions
Opportunity for direct to consumer model through Renew Sleep Solutions (“RSS”) For personal use only Opportunity could reach $300-500m revenues with ongoing OSA growth International Expanded solutions RSS Lite in smaller cities – next 50 Core RSS model in top 50 cities 6
Slide 7: Innovation driving the acceleration of SomnoMed
Innovation driving the acceleration of SomnoMed Technology as well as service and solution design will help fuel our growth For personal use only Use of end to end Improved device design Solution and service design digital technology including material development To provide a more holistic patient
Slide 8: 2020 vision and targets
2020 vision and targets For personal use only • Driving an integrated sleep solution business, combining traditional manufacturing and distribution of COAT™ devices with full scale Managed Care and “Direct to Patient” business • Over 600,000 patients suffering from Obstructive Sleep Apnea, treated b
Slide 9: First half 2017/18 results
For personal use only Improving lives through better sleep First half 2017/18 results
Slide 10: Strong revenue growth after slow start to the year
Strong revenue growth after slow start to the year For personal use only Total SOM including RSS A$000’s 35,000 +33% 30,000 25,000 20,000 +45% 15,000 +19% 10,000 5,000 -0 Q1 Q2 FH 2016/17 2017/18 10
Slide 11: Revenue growth by region
Revenue growth by region For personal use only Growth in NA fuelled by RSS Accelerating growth in Europe APAC stable A$000’s North America & RSS A$000’s Europe A$000’s APAC 18,000 16,000 2,500 +48% +25% -1% 16,000 14,000 2,000 14,000 12,000 12,000 10,000 1,500 10,000 8,000 8,000 1,000 6,000 6,000 4,
Slide 12: North America total revenue split
North America total revenue split For personal use only Sales channel change 2017/18 A$000’s North America and RSS 18,000 16,000 14,000 +48% 12,000 6,615 10,000 RSS 8,000 +75% 4,680 NA +18% 6,000 1,935 10,352 4,000 8,698 4,957 5,395 4,777 2,000 3,921 0 2016/17 2017/18 2016/17 2017/18 2016/17 2017/18
Slide 13: RSS now operating centres across USA
RSS now operating 12 centres across USA Significant progress with start-up challenges For personal use only • Fast roll out: 12 centres opened in 12 months • Total investment by 31 December 2017 = US$8.7m • Many factors influenced performance of individual centres and caused greater cash burn than p
Slide 14: Centre fundamentals of the first four consistent with original expectations
Despite start-up challenges, centre fundamentals of the first four are consistent with original expectations For personal use only Average metrics of first 4 centres in 12 months to December First four centres – results to December 2017 – average period 10.75 months Number of patients May 2016 Inves
Slide 15: Summary profit and loss first half FY18
Summary profit and loss first half FY18 For personal use only • SomnoMed Core Financial Summary – AUD $000’s SomnoMed Group SomnoMed Core RSS SomnoMed Group o Sales and marketing spend in Europe according First half comparison FY18 FY17 FY18 FY18 FY18 to plan 1st H 1st H 1st H 1st H 1st H o US reven
Slide 16: Guidance showing improving second half results
Guidance showing improving second half results For personal use only • SOM – continuing growth in second half o EU strong First-half Second-half FY18 o US stabilized and growing again Guidance 2017/18 (A$) (A$) (A$) o APAC steady Revenue $31.6m $35.4m-$38.4m $67m-$70m • RSS – continuing expansion of
Slide 17: Accelerated Entitlement Offer
For personal use only Improving lives through better sleep Accelerated Entitlement Offer
Slide 18: RSS centre performance compared to S3
RSS centre performance compared to S3 S3 centre ramp up vs first 4 For personal use only S3 patient growth strong First 12 months unit performance S3 patients treated Units Number of patients Dallas and Fort Worth 100 3,000 90 2,749 +30% 80 2,500 70 2,108 60 2,000 50 1,500 40 30 1,000 20 10 500 - Mo
Slide 19: RSS treatment centre economics
RSS treatment centre economics For personal use only Year 1 * Year 2 Year 3 May 2016 Current May 2016 Current May 2016 Current Presentation estimate Presentation estimate Presentation estimate Patients treated 450 450 1,250 900 1,650 1,200 Revenue per centre (A$m) 1.25 1.25 3.20 2.50 4.00 3.30 Contr
Slide 20: Accelerated pro-rata entitlement issue
Accelerated pro-rata entitlement issue For personal use only • SomnoMed has successfully commenced the rollout of its “Direct to Patient” OSA model through its Renew Sleep Solutions centres across North America and wishes to continue this expansion, Opportunity overview which requires additional wor
Slide 21: Offer
Offer For personal use only • Pro-rata non-renounceable accelerated 1:17 entitlement issue at $3.00 per share to raise approximately $10.4 million • The offer price represents a discount to TERP of 0.9% and a discount to last closing price of 1% • Funds to provide working capital and fund the contin
Slide 22: Timetable
Timetable For personal use only Procedure Step Date Procedure Step Date Trading halt 19 February 2018 Information Booklet and Entitlement and Acceptance Form 26 February 2018 sent to Retail Investors Announcement of Entitlement offer 19 February 2018 Retail Entitlement Offer opens 26 February 2018 I
Slide 23: Offer restrictions
Offer restrictions For personal use only This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any New Zealand jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any This document has not been registered, fi
Slide 24: Risks
Risks For personal use only SomnoMed is subject to a number of risks and other factors that may Growth management and additional capital requirements Changes potentially affecting prices charged impact both on its future performance and the market price at which its The existing and future operation
Slide 25: Contact details
Contact details For personal use only CHIEF EXECUTIVE OFFICER Mr. Derek Smith CHIEF FINANCIAL OFFICER Mr. Neil Verdal-Austin Address Level 3, 20 Clarke Street Crows Nest NSW 2065 Australia Telephone +61 (2) 9467 0400 Website www.somnomed.com.au 25