Sonic Healthcare Limited · ASX:SHL
Sonic Healthcare — FY2012 Earnings Presentation
19 slides from Sonic Healthcare's earnings presentation, Aug 21, 2012
Slide 1: Financial and Operational Review
Financial and Operational Review Year ended 30 June 2012 Colin Goldschmidt CEO, Sonic Healthcare 21 August 2012
Slide 2: Forward-looking statements
Forward‐looking statements This presentation may include forward‐looking statements about our financial results, guidance and business prospects that may involve risks and uncertainties, many of which are outside the control of Sonic Healthcare. Readers are cautioned not to place undue reliance on f
Slide 3: Highlights
Highlights Growth Constant Currency Statutory Revenue 11% 8% EBITDA 12% 9% Net Profit 10% 7% Operating cashflow N/A 19% Full‐year guidance met Strong revenue growth Margin expansion 30 bps ROIC accretion 90 bps Ongoing synergy capture, particularly procurement Strong and stable operation
Slide 4: Financial Summary
Financial Summary FY ‘12 Growth FY ‘12 Currency FY ‘12 v FY ‘11 Translation Constant Currency Constant Currency Statutory Effects Revenue A$M 3,423 11% 3,346 (77) EBITDA A$M 639 12% 624 (15) Net Interest Expense A$M 78 20% 74 4 Net Profit A$M 323 10% 316 (7) Earnings per Share (EPS) cents 82.5 9% 80
Slide 5: Dividends and DRP
Dividends and DRP FY ‘12 Interim Dividend A$0.24 Final Dividend A$0.35 Total Dividend A$0.59 Final dividend franked to 45% Record Date 7 September 2012 Payment Date 9 October 2012 Dividend Reinvestment Plan activated Fine‐tuning of capital structure Expectation of Healthscope acquisition
Slide 6: FY '13 Guidance
FY ‘13 Guidance EBITDA growth of 5‐10% Range allows for fee changes in key markets Interest expense to decrease by 5‐10% Due to lower base rates in the USA and Europe Effective tax rate ~26% Based on constant currency (FY ‘12 FX rates) Excludes Healthscope and other future acquisitions
Slide 7: Return on Invested Capital (ROIC)
Return on Invested Capital (ROIC) FY ‘12 FY ‘11 Change ROIC 9.8% 8.9% 90 bps Improvement driven by: Organic revenue and earnings growth Synergy capture Synergistic acquisitions No beachhead acquisitions – critical mass achieved in major markets ROIC accretion to continue ROIC calculated
Slide 8: Revenue Split
Revenue Split FY ‘12 IPN $299 9% Radiology Australia New Zealand $384 $1,004 $62 2% 11% 30% Switzerland $75 2% Belgium $101 3% UK & Ireland $111 4% Germany USA $542 $765 16% 23% Statutory revenue in A$ M
Slide 9: Australian Pathology
Australian Pathology Revenue growth 9% Market growth (Medicare outlays) for same period 7% Market share growth Sonic growth > market growth FY ‘12: 28% larger than nearest competitor FY ‘11: 25% larger than nearest competitor Efficiency gains and synergy capture ongoing Procurement s
Slide 10: Australian Pathology: Regulatory Environment
Australian Pathology Regulatory Environment Pathology funding agreement 5 year agreement providing industry stability Target growth rate exceeded in year one Industry and Government discussing target adjustments Collection centre deregulation Growth of new collection centres has slowed
Slide 11: USA
USA Revenue growth 11% Organic revenue growth 2%, yet higher than major competitors Industry growth remains subdued Operations New Sonic USA CEO, David Bryant from 1 September 2012 Follows retirement of David Schultz after 7 years of outstanding service Synergy, integration, centralisa
Slide 12: Germany
Germany Revenue growth 7% Organic revenue growth 6% Synergy capture ongoing Procurement savings – major tenders underway Benefits of completed lab mergers Rationalisation of logistics networks Centralisation of testing Roll‐out of e‐Health solutions Synergistic acquisitions ~A$10
Slide 13: Germany: Regulatory Environment
Germany Regulatory Environment New national funding structure for statutory insurance (“EBM”) fees Commences 1 October ‘12 Replaces regional funding – regional short payments to cease Details of new funding structure not finalised Adjustments aimed at curbing above‐average industry growth
Slide 14: Europe
Europe Belgium, Switzerland, UK & Ireland UK & Ireland Revenue growth 23% – includes BMI and Ramsay contracts and organic growth North West London Hospital Trust contract implementation underway Currently participating in major NHS tenders Bowel cancer screening contract win in Ireland B
Slide 15: Sonic Imaging Medical Centres (IPN)
Sonic Imaging Medical Centres (IPN) Sonic Imaging Organic revenue growth 6% Tight cost control Additional full and partial MRI licences from November 2012 Radiologist leadership and engagement Stable workforce and business IPN Revenue growth 35%, including acquisitions and organic gr
Slide 16: Sonic Debt Summary
Sonic Debt Summary 30 June ‘12 30 June ‘11 Net interest‐bearing debt A$M 1,571 1,536 Gearing ratio % 37.6 37.9 Interest cover X 7.0 7.4 Debt cover X 2.5 2.8 Available headroom ~A$780 million Before final dividend and DRP Excludes potential Healthscope acquisition Gearing ratio = Net debt / Net
Slide 17: Sonic Healthcare - Overview
Sonic Healthcare ‐ Overview Global medical diagnostics service provider Top‐3 market position in laboratory medicine in 8 countries Australia #1 UK/Ireland #1 New Zealand #2 USA #3 Belgium #2 Australian radiology #2 Germany #1 or 2 Switzerland #3 Australian medical centres #1
Slide 18: Outlook
Outlook Consistent application of proven model ROIC and EPS accretion Market share gains in major markets Cost control and efficiency gains Leverage existing infrastructure for synergies and earnings growth Prudent acquisition and expansion strategies Sonic in attractive industry – str
Slide 19: Thank You
SONIC HEALTHCARE Thank You Peto pl + ar * . —_— ZS