Infusystems Holdings, Inc. · AMEX:INFU
Infusystems — InfuSystem Holdings — Investor Presentation (September 2016)
47 slides from Infusystems's investor presentation, Sep 26, 2016
Slide 1: Corporate Presentation September 2016
CORPORATE PRESENTATION SEPTEMBER 2016 (NYSE MKT: INFU) Exhibit 99.1
Slide 2: Safe Harbor Statement
Safe Harbor Statement INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Certain statements contained in this presentation are forward-looking statements and are based on future expectations, plans and prospects for the business and operations of InfuSystem Holdings, Inc. (“InfuSystem” or “the
Slide 3: About InfuSystem
InfuSystem provides infusion pumps and related products and services for patients in the home, oncology clinics, ambulatory surgery centers, and other health care sites. Improving access to quality medical equipment required by clinicians Delivering products and processes that drive down the cost of
Slide 4: Investment Highlights
Investment Highlights INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST InfuSystem is a dominant provider in the at-home oncology infusion pump market 30%+ market share Business generates substantial annual cash flow $18.8 M AEBITDA in 2015 and $19.4 M for the TTM ending 2Q16 $7.9 M of Free C
Slide 5: Leading Provider of Oncology Infusion Pumps: Four Revenue Streams
InfuSystem: Leading Provider of Oncology Infusion Pumps INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Four Revenue Streams to Drive Cash Flows (FY 2015) Core Business: Leading provider to Patients, Hospitals and Infusion Clinics in North America InfuSystem enables oncology patients the co
Slide 6: Dominant Player in Our Niche
Dominant Player in Our Niche INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST InfuSystem pumps permit oncology patients to receive treatment in the comfort of their home. 24/7 on-call oncology nurses InfuSystem is the market leader with more than ~1,750* customer/facility count - hospitals a
Slide 7: Management Executing On Value-Creation Strategy
Management Executing On Value-Creation Strategy INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST New management team focused on “Value-Creation Strategy” through series of strategic initiatives Four unique business models to capture increasing share of market opportunity and benefit from cha
Slide 8: Value-Creation Strategy: Four Revenue Streams Driving Cash Flows
Value-Creation Strategy INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST FOUR REVENUE STREAMS DRIVING CASH FLOWS
Slide 9: Four Revenue Streams to Drive Cash Flows
Four Revenue Streams to Drive Cash Flows INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Patient-Based Rental (TPP) 72% of 2015 Sales A hospital/clinic provides an INFU pump to a patient to be utilized for at-home therapy InfuSystem bills patients insurance company for payment Hospital-Home
Slide 10: Revenue Growth - Rental and Sales
Revenue Growth - Rental and Sales INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Product Sales $ Millions $ Millions Rental Revenues (Gross to Net Collected) *TTM as of 6/30/16
Slide 11: Net Collected Revenue and Bad Debt
Net Collected Revenue INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Bad Debt as a Percent of Rental Revenue As new healthcare laws have been enacted, the focus on net collected revenue becomes increasingly important as a direct result of focus on contractual insurance changes Company's in
Slide 12: Strong Customer Stickiness Leads to High Revenue Predictability
Strong Customer “Stickiness” Leads to High Revenue Predictability INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Strong value placed on hospital/clinic contracts and relationships due to strong “reorder/recurring” revenue component InfuSystem provides patient-based pump rentals through ~1,
Slide 13: Value-Creation Takeaway: Strategic Acquisitions
Value-Creation Takeaway INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST STRATEGIC ACQUISITIONS TO STRENGTHEN MARKET SHARE IN CORE ONCOLOGY BUSINESS
Slide 14: Strategic Acquisitions to Increase Market Share
Strategic Acquisitions to Increase Market Share INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST InfuSystem has the largest inventory of home infusion pumps for the oncology market in the U.S. In April 2015, the company acquired Ciscura Holding Company, Inc., based in Alpharetta, Georgia Acq
Slide 15: InfuSystem Service Centers
Kansas City Service Center Madison Heights Service Center Future Northeast Service Center (est. 2017) Atlanta Service Center (2015) Los Angeles Area Service Center Houston Service Center (2014) Toronto Canada Service Center Faster Turnaround Times and Improved Utilization INNOVATION | TEAMWORK | INT
Slide 16: Value-Creation Takeaway: Expanding into Adjacent Markets
Value-Creation Takeaway INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Expanding into adjacent addressable markets to drive growth
Slide 17: Expansion into At-Home Pain Management Infusion Pump Market
Expansion into At-Home Pain Management Infusion Pump Market INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Pain relieving effects of a peripheral nerve block can be extended by using a continuous peripheral nerve block catheter, local anesthetic & an electronic infusion pump Growing therap
Slide 18: Value-Creation Takeaway: Next Generation Systems and Technologies
Value-Creation Takeaway INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST INVESTMENTS INTO NEXT GENERATION SYSTEMS AND TECHNOLOGIES TO INCREASE CUSTOMER RETENTION
Slide 19: InfuConnect: Enhancing Customer Retention and Future Growth Driver
InfuConnect: Enhancing Customer Retention and Future Growth Driver (EMR) INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST EMR Integration – Simple as 1-2-3 Industry-Leading True- Paperless Solution More accurate / More efficient Smart Data Listener & Extractor Save up to 20 minutes per patie
Slide 20: InfuConnect: Life Cycle Management
InfuConnect: Life Cycle Management INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST State of the Art Asset Tracking and Management Track Assets in Real Time Improve Recovery Rates Extend Asset Life Track From Any Device Fleet Management Made Easy Order Additional Pumps Schedule Service & Rep
Slide 21: Pain Management and Reporting
Pain Management and Reporting INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Real-Time Pain Score Reporting Supporting High Patient Satisfaction Online, Anytime
Slide 22: Value-Creation Takeaway: Financial Overview
Value-Creation Takeaway INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST FINANCIAL OVERVIEW
Slide 23: Total Revenue: Total vs Net Collected
Total Revenue: Total vs Net Collected INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST $ Millions Total Revenues (Gross to Net Collected) *TTM as of 6/30/16
Slide 24: Strong Gross and Adjusted EBITDA Margins
Strong Gross and Adjusted EBITDA Margins INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Gross Margins *2014 does NOT add-back the following charges: G&A expense on IT and Pain Management initiatives of $0.7M, a write-off of pumps $0.4M, severance of $0.2M Adjusted EBITDA Margins See Append
Slide 25: Free Cash Flow and Adjusted EBITDA
Free Cash Flow and Adjusted EBITDA INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Free Cash Flow* See Appendix for Regulation G Reconciliation $ Millions $ Millions Adjusted EBITDA See Appendix for Regulation G Reconciliation *Free Cash Flow is presented under a new definition as of 12/31/
Slide 26: Net Income and Diluted EPS
Net Income and Diluted EPS INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Net Income $ Millions Earnings Per Share Fully Diluted Basis ($45) ($45.4) *Q1-Q4 2015 = Normalized EPS-see Appendix for Regulation G Reconciliation *FY2015 is Normalized Net Income - see Appendix for Regulation G Re
Slide 27: Increased Borrowing Facility to Expand Future Pump Inventory
Increased Borrowing Facility to Expand Future Pump Inventory INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST History of strong Free Cash Flows providing added borrowing capacity to expand growth of pump inventory Reduced cost of capital on new credit facility allows for increased Return on
Slide 28: New $45 Million Credit Facility
New $45 Million Credit Facility INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST $45 million credit facility signed with JPMorgan Chase in March 2015 Term is five years $10 million revolver – undrawn at close $27 million Term Loan A – fully drawn at close $8 million Term Loan B – undrawn at
Slide 29: Significant Barriers to Entry
Significant Barriers to Entry INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Established, long standing relationship with oncology practices ~1,750 Customer/Facility count* Growing Third Party Payor contracts ~420 Payor networks under contract* 98% retention of customer business in 2015 La
Slide 30: Why Invest in InfuSystem?
Why Invest in InfuSystem? INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Leading Operator in Core Business – Oncology Infusion Dominate player in oncology infusion market Large fleet of ambulatory pumps for Rental or Sale Expanding Market Share Aging Population and Cancer Growth Solid Fina
Slide 31: Questions?
Questions? Russell Microcap® Index (NYSE MKT: INFU) IR Contact Info: Joe Dorame, Managing Partner Lytham Partners, LLC 602-889-9700 dorame@lythampartners.com
Slide 32: Appendix
InfuSystem—Infusion Made Easy INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST APPENDIX
Slide 33: Company Snapshot
Company Snapshot INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST InfuSystem Holdings, Inc. Commentary Financial Summary ($ in millions) Headquarters: Madison Heights, MI Founded: 1998 Specialization: Healthcare / Medical Instruments & Supplies Management: Eric Steen, Pres. & CEO, Chris Down
Slide 34: InfuSystem Niche - Extension of Clinic to Home
InfuSystem Niche – Extension of Clinic to Home INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Ambulatory Home Infusion 25-year old business model in DME billing At home, at work, at play, all while receiving the drug High satisfaction scores 24/7 on-call oncology nurses Proven outcomes wit
Slide 35: Hospital-Home Care Based Direct Payor Business Model
Hospital-Home Care Based Direct Payor Business Model INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Infusion pumps Enteral pumps InfuSystem’s Hospital-Home Care Based (DP) business is focused primarily on the sale, rental, financing and accompanying service of movable medical equipment to
Slide 36: Hospital-Home Care Based Direct Payor Offerings
Hospital-Home Care Based Direct Payor Offerings INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST InfuSystem offers new pumps from top brands Broker-dealer trading desk In addition, over 70 models and versions of pre-owned pumps are offered Pre-owned pumps are re-built and certified by in-hou
Slide 37: Medical Equipment Service & Repair
Medical Equipment Service & Repair INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST In addition to supporting and repairing InfuSystem’s in-house fleet, the Company certifies, recalibrates, repairs and services a variety of infusion pumps Pumps require scheduled maintenance and calibration i
Slide 38: SE1609 Overview
SE1609 Overview INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST On April 25, 2016, CMS released the Medical Learning Network (“MLN”) Matters Number SE1609 “Medicare Policy Clarified for Prolonged Drug and Biological Infusions Started Incident to a Physician’s Service Using an External Pump”
Slide 39: Leverage: Total Debt to Adjusted EBITDA
INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST April 2015 - Acquires Ciscura for total of $6.2M Leverage: Total Debt to Adjusted EBITDA US$ millions
Slide 40: Leverage: Total Debt to Book Equity
INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST April 2015 - Acquires Ciscura for total of $6.2M Leverage: Total Debt to Book Equity US$ millions
Slide 41: Non-GAAP Reconciliation: TTM Net Income to Adjusted EBITDA by Quarter
Non-GAAP Reconciliation: TTM Net Income to Adjusted EBITDA by Quarter INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Unaudited, in US$ thousands 3Q 2015 4Q 2015 1Q 2016 2Q 2016 Trailing 12 Months Net Income 1,369 2,006 495 724 4,594 plus Interest Expense 338 308 305 327 1,278 plus Income T
Slide 42: Non-GAAP Reconciliation: Annual Net Income to Adjusted EBITDA (part 1 of 3)
Non-GAAP Reconciliation: Annual Net Income to Adjusted EBITDA to Free Cash Flow to Change in Cash (part 1 of 3) INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Unaudited, in US$ thousands FY2011 FY2012 FY2013 FY2014 FY2015 Net Income (45,443) (1,489) 1,669 3,357 3,743 plus Interest 2,193 3,
Slide 43: Non-GAAP Reconciliation: Free Cash Flow (part 2 of 3)
Non-GAAP Reconciliation: Annual Net Income to Adjusted EBITDA to Free Cash Flow to Change in Cash (part 2 of 3) INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Unaudited, in US$ thousands FY2014 FY2015 Adjusted EBITDA (continued from prior page) 16,061 18,785 less cash Taxes (298) (146) plu
Slide 44: Non-GAAP Reconciliation: Change in Cash (part 3 of 3)
Non-GAAP Reconciliation: Annual Net Income to Adjusted EBITDA to Free Cash Flow to Change in Cash (part 3 of 3) INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Unaudited, in US$ thousands FY2014 FY2015 Cash Flow available/(deficit) before Optional Net Reduction of Debt and Other (continued
Slide 45: Non-GAAP Reconciliation: Normalized Net Income and EPS by Quarter
Non-GAAP Reconciliation: TTM Operating Income to Normalized Net Income and EPS by Quarter INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST Unaudited, in US$ thousands except per share values 3Q 2015 4Q 2015 1Q 2016 2Q 2016 Trailing 12 Months Operating Income $2,711 $3,284 $1,164 $1,381 $8,54
Slide 46: Detailed Historical Income Statement
Detailed Historical Income Statement INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST
Slide 47: Detailed Historical Balance Sheet
Detailed Historical Balance Sheet INNOVATION | TEAMWORK | INTEGRITY | FOCUS | PEOPLE FIRST
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