Cleopatra Hospital Company · EGX:CLHO
Cleopatra Hospital — Cleopatra Hospitals Group — Q1 2022 Earnings Presentation
45 slides from Cleopatra Hospital's earnings presentation, 2022
Slide 1: Cleopatra Hospitals Group Investor Presentation 1Q2022
Cleopatra Hospitals Group Investor Presentation 1Q2022
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements, including, but not limited to, statements concerning expectations, projections, objectives, targets, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating
Slide 3: Contents
CONTENTS 1 Macro Environment & CHG Investment Story 2 Performance Review 3 Business Updates 4 Governance & Shareholder Information 5 Appendix
Slide 4: Our Mission & Values
Our Mission & Values — We put our patients first by providing high quality healthcare services with a focus on patient safety and quality of outcomes while enhancing the quality of life of our patients — We focus on creating sustainable growth with positive measurable impact on our stakeholders and
Slide 5: A Unique Investment Story
A Unique Investment Story • Leading integrated healthcare • Group-wide tenders in provider in Egypt with track pharmaceuticals and medical record of acquiring and consumables that drive scale cost integrating leading operating efficiencies and improve margins hospital assets • Scale volume benefits
Slide 6: A Diversified Healthcare Services Group
A Diversified Healthcare Services Group • Cleopatra Hospitals Group is Egypt’s first and largest private hospital group by number of hospital beds and operating hospitals and consists of six operational Other hospitals and two polyclinics in addition to a leading IVF Centre all in Cairo. The Outpati
Slide 7: CHG's Journey History & Timeline
CHG’s Journey History & Timeline The Evolution of CHG from a Single Asset into one of the Largest Hospital Platform in the Region The first asset and the CHG acquired Nile Badrawi CHG signed a definitive CHG acquired and began CHG enters into a JV Group’s Flagship Hospital in October 2015 agreement
Slide 8: Broad Network Coverage in Greater Cairo
Broad Network Coverage in Greater Cairo Leveraging a growing footprint, CHG continues to penetrate new segments of the population and provide high quality care to currently underserved areas of Greater Cairo Cleopatra Hospitals Group, is the largest private 9 hospital group in Egypt by number of bed
Slide 9: Diversified Service Offering and Revenue Stream
Diversified Service Offering and Revenue Stream CHG delivered a strong first quarter performance significantly exceeding pre-pandemic New Revenue Stream levels in non-COVID-19-related business as of Q4 2020 70% 3% 19% 5% 3% OUTPATIENT IVF HOSPITALS* POLYCLINICS DIAGNOSTICS PHARMACY CHG operates six
Slide 10: Clearly Defined Core Growth Strategy
Clearly Defined Core Growth Strategy Integrating the platform to Leveraging payor and achieve higher efficiencies supplier relationships Geographic expansion in Egypt Enhancing utilization and linked to following optimizing existing capacity Establish centers of while expanding capacities and the ma
Slide 11: Healthcare Provider of Choice
Healthcare Provider of Choice Creating a one-stop-shop that is seamlessly integrated across all our assets comes as a result of the Group’s persistence in keeping our patients at the center of everything we do, while at the same time ensuring to drive value to all CHG’s key stakeholders. With that f
Slide 12: CHG 1Q2022 Financial Highlights
CHG 1Q2022 Financial Highlights CHG delivered a strong first quarter performance significantly exceeding pre- pandemic levels in non-COVID-19-related business as COVID-19 contribution continues to decline; margins stood in line EGP 636.9 mn ↑16% Consolidated revenues in 1Q2022 Non-COVID-19 related w
Slide 13: 1Q2022 in Review
1Q2022 in Review Cleopatra Investor Presentation 1Q2022 13
Slide 14: Financial Performance in 1Q2022
Financial Performance in 1Q2022 CHG delivered a strong first quarter performance exceeding pre-pandemic levels in non-COVID-19-related business as COVID-19 contribution continues to decline; margins stood in line with Group’s historical averages and above pre-pandemic levels. Furthermore, the Group’
Slide 15: Direct vs. Indirect COVID Contribution
Direct vs. Indirect COVID Contribution In addition to the Group’s dedicated COVID-19 facilities, CHG was also indirectly impacted by the pandemic in non-COVID-19 facilities through its diagnostics, outpatient, and emergency service offerings. Our Clinisys system allowed us to trace cases served acro
Slide 16: Non-COVID Business Performance
Non-COVID Business Performance 2021 reflects an abnormally high base effect in light of high margin COVID business contribution that has impacted the Group’s year-on-year growth during 1Q 2022. When considering the rebound in non-COVID related patients and recovery of demand for elective procedures
Slide 17: Group Revenue Analysis
Group Revenue Analysis Group Revenue Trend Closed 2020 with 11% growth Y-o-Y. Growth was maintained The Group closed 2018 with in Q1 2021 as patient volumes solid growth in revenue on a continued to recover, full year basis of 29% Y-o-Y, as recording 26% growth Y-o-Y well as on a quarterly basis of
Slide 18: Patient Volumes Recovery Journey
Patient Volumes Recovery Journey The Group’s East and West Cairo polyclinics continued to perform well, delivering strong year-on-year top-line growth coupled with solid expansion in profitability margins during 1Q2022. During the first quarter of the year, the Group’s polyclinics recorded revenue o
Slide 19: Group Revenue Contribution
Group Revenue Contribution in 2021 CHG reported revenues of EGP 636.9 million in the first quarter of 2022, marginally above year’s figure. The year-on-year expansion comes despite a sharp drop in COVID-19-related revenues and thanks to strong growth across its non-COVID-19 business. Throughout the
Slide 20: Financial Performance by Hospital (i)
Financial Performance by Hospital (i) Cleopatra Hospital (CHC) Cairo Specialized Hospital (CSH) 251 221 119 112 202 102 45% 87 30% 158 164 44% 48% 43% 70 34% 30% 36% 32% 41% 113 87 97 79 31 35 36 36 64 21 1Q2018 1Q2019 1Q2020 1Q2021 1Q2022 1Q2018 1Q2019 1Q2020 1Q2021 1Q2022 Revenue Gross Profit Reve
Slide 21: Financial Performance by Hospital (ii)
Financial Performance by Hospital (ii) Al- Katib Hospital (KHC) Queens Hospital (QHC) 41.7 48.6 43% 55% 24.1 25% 30.2 27.2 50% 17.7 14.8 6.4 6.2 1.5 1Q2020 (3.3) 1Q2021 1Q2022 (5.8) 1Q2020 1Q2021 1Q2022 Revenue Gross Profit Revenue Gross Profit East & West Polyclinics* 31.7 31.2 31.7 25.9 29.1 25.9
Slide 22: Key Revenue Drivers (i)
Key Revenue Drivers (i) CHG reported revenues of EGP 636.9 million in the first quarter of 2022, marginally above year’s figure. The year-on-year expansion comes despite a sharp drop in COVID-19-related revenues and thanks to strong growth across its non-COVID-19 business. Throughout the quarter, re
Slide 23: Key Revenue Drivers (ii)
Key Revenue Drivers (ii) Cases Served* expanded 10% year-on-year in 1Q2022, with the Group serving over 263 thousand patients during the quarter. On a quarterly basis, cases served were down 7% versus 4Q2021. Despite an unfavorable macro environment coupled with a general decline in covid hospitaliz
Slide 24: Capex Profile
Capex Profile Capex Investments Organic Capex Expansion Capex Acquistions Acquisition Investments: • El Katib (143mn Propco & 135mn Opco) • Queens (25mn Opco) • IVF (2020) EGP 115mn Acquisitions 115 160 Medical & Renovation Capex: 406 358 • Investments Across the 4 Organic Hospitals 279 Organic Cape
Slide 25: Transformation Review
Transformation Review Cleopatra Investor Presentation 1Q2022 25
Slide 26: Transformational Approach
Transformational Approach Patient Operational Business Model Experience Efficiency Enhancements Systems Organic Volumes Digital Transformation & Processes & COEs Human Resources Further developing Focusing efforts on further establishing the Transformational personnel Group’s one-stop-shop model Lev
Slide 27: M&A and Expansions Progress
M&A and Expansions Progress M&A & Expansions Projects 2021 2022 2023 2024 200 Bed Brownfield Management agreement terms and Completion of hospital’s remaining Hospital’s first year of operations (25 Project (Sky Hospital) conditions were signed and works years management contract) announced Queens H
Slide 28: Expanding CHG's Presence to New Cairo
Expanding CHG’s Presence to New Cairo 6th October location 2021 New Hospital Project Under Construction Location New Cairo # of Beds ~200 Project Completion 2024 Cleopatra Investor Presentation 1Q2022 28
Slide 29: Market & Competition Analysis
Market & Competition Analysis Investment & Strategy Expand geographical presence in new underserved areas Patient Focused Marketing and product development Volume driven strategy aiming to attract both patients and cities (New Cairo , October) through Hospitals, with emphasis on patient experience,
Slide 30: The Group's Centers of Excellence
The Group’s Centers of Excellence Defining Centers of Excellence Select Examples of CHG’s Centers of Excellence Competitive Defined Scope & Sales Nursing & Residents Advantage & Focus Team Differentiation Consumables Medical Equipment & Payor Recognition Planning Technology Medical & Branding & Mark
Slide 31: Expanding CHG's Digitalization Agenda
Expanding CHG’s Digitalization Agenda The Group recognizes digitalisation as a key driver for future growth. Over the last few years, CHG has embarked on a digital transformation strategy, which aims to introduce the latest digital solutions available to enhance all aspects of the Group’s day-to-day
Slide 32: Leveraging on Clinisys' Successful Roll-Out
Leveraging on Clinysis’ Successful Roll-Out Patients’ Engagement Platforms Website Social Media CHG Mobile App CHG Video Call App Appointment booking is also available Allows patients to book appointments on CHG’s mobile app across all of its online at all CHG hospitals and clinics. facilities. Cent
Slide 33: Group's Website Overhaul
Group’s Website Overhaul Online Booking Access to Medical Records Patient will be able to book Provide patient access to own online on the system directly and medical record across the group will be able to see OPD slots as (lab. Rad, OPP visits, inpatient implemented in each hospital admission, ER,
Slide 34: Governance & Shareholder Information
Governance & Shareholder Information Cleopatra Investor Presentation 1Q2022 34
Slide 35: Governance (I)
Governance (I) The Group’s Board of Directors provides the necessary oversight and combination of expertise to thoroughly oversee the Group’s corporate governance framework, a cornerstone of the Group’s long-term success and value creation. Board of Directors The Group’s board of directors includes
Slide 36: Governance (II)
Governance (II) OPERATIONS ABC No Referral Fees Medical Council • CHG has a zero-tolerance approach to bribery and • CHG does not pay any referral fees or kickbacks to • CHG recently launched a group-wide medical council corruption with a clear anti-bribery and anti-corruption physicians and instead
Slide 37: CLHO Trading Analysis
CLHO Trading Analysis CHG’s Trading Analysis CHG’s Price Performance Since IPO (Rebased to 100) Valuation Multiples 298% % Change in 17.7x Performance 37% 13.3x 11.4x (IPO - Date) EV/EBITDA 8.9x CHG EGX30 Valuation Multiples (x) CLHO Volume CHG EGX30 120 FY 2019 FY 2020 FY 2021 Q1 2022 110 36.3x 100
Slide 38: Buyback Program Update
Buyback Program Update CLHO VWAP & Volumes Traded – Jan. 2021 to Date % of CLHO bought back as of Q1 22’ 3.10% Total Shares Bought as of Q1 22’ 49.6 Mn 5.6 Share Buyback Termination of Share Share Buyback 350 00000 Program –Round One Buyback Program – Program –Round Two Commencement Round One Commen
Slide 39: Appendix
Appendix Cleopatra Investor Presentation 1Q2022 39
Slide 40: Balance Sheet and Leverage
Balance Sheet and Leverage Balance Sheet Summary Cashflow Movement Balance Sheet Summary (EGP 000') Dec-21 Mar-22 Cash & Cash Equivalent 846 708 Inventory 51 57 Debtors and other debit balances 576 550 Current Assets 1,473 1,316 Fixed Assets 1,352 1,375 Intangible Assets 426 425 Non-Current Assets 1
Slide 41: Cash Conversion Cycle
Cash Conversion Cycle DIO DSO 91 86 41 36 Mar - 20 Mar - 21 Mar - 21 Mar - 22 DPO Cash Conversion Cycle 26 106 102 20 Mar - 21 Mar - 22 Mar - 21 Mar - 22 Cleopatra Investor Presentation 1Q2022 41
Slide 42: Consolidated Income Statement
Consolidated Income Statement All figures in EGP mn 1Q2021 1Q2022 % change 4Q2021 1Q2022 % change Revenues 633.2 636.9 1% 648.7 636.9 -2% Cost of sales (392.0) (415.0) 6% (408.4) (415.0) 2% Gross profit 241.2 222.0 -8% 240.3 222.0 -8% Gross Profit Margin 38% 35% 37% 35% General & administrative expe
Slide 43: Consolidated Balance Sheet
Consolidated Balance Sheet All figures in EGP mn 31 December 2021 31 March 2022 Non-current assets Fixed assets 1,351.7 1,374.7 Intangible assets 425.5 425.0 Right of use 174.7 167.6 Payment under investment 5.7 5.7 Investment in associates 2.2 2.2 Total non-current assets 1,959.8 1,975.2 Current as
Slide 44: Consolidated Cashflow Statement
Consolidated Cashflow Statement All figures in EGP mn 31 March 2021 31 March 2022 Cash flow from operating activities: Profit before tax 145.5 129.8 Adjustments for: Depreciation 27.0 38.1 Right of use depreciation - - Amortization of intangible assets 4.0 4.0 Allowance for impairment of current ass
Slide 45: Thank you
Thank you INVESTOR RELATIONS CONTACTS SHAREHOLDER INFORMATION Telephone: +2 02 23103771 EGX: CLHO.CA E-mail: ir@cleopatrahospitals..com Listed: June 2016 investors.cleopatrahospitals.com Shares Outstanding: 1.6 billion Cleopatra Investor Presentation 1Q2022 45
Cleopatra Hospitals Group — Q1 2022 Earnings Presentation on 6ix