Humana Inc. · NYSE:HUM
Humana — Q3 2021 Earnings Presentation
23 slides from Humana's earnings presentation, Nov 11, 2021
Slide 1: Interim report July-September, Q3 2021
Everyone is entitled to a good life. Interim report July-September, Q3 2021 Rasmus Nerman, Noora Jayasekara, 11 November 2021
Slide 2: Continued steady progress in the third quarter
Continued steady progress in the third quarter • Good overall progress in Group with continuous steady financial performance • Demand and occupancy rates gradually recovering across the Nordics • Acquisitions within Individual & Family and Personal Assistance (in Q3 and Q4) • Johanna Rastad appointe
Slide 3: Financial highlights Q3 2021
Financial highlights Q3 2021 Growth • Revenue: SEK 2,034m (1,931), +5.3% vs LY • Organic growth: 3.0% (2.2) Profitability • Operating profit: SEK 192m (172m), +11.5% • Adj. operating profit: SEK 192m (172m), +11.5% • Operating margin: 9.4% (8.9%) Cash flow & leverage • Operating cash flow: SEK 180m
Slide 4: Focus on quality and method development
Focus on quality and method development • Most of customers, clients and employees have received Covid-19 vaccine • Situation well under control • Strict preventive procedures for all operations • Humana Quality Index, HQI, stable a 94 in Q3 • Customer satisfaction index at 85% • A major and extensi
Slide 5: Strong quarter and promising political move
Strong quarter and Personal promising political move Assistance • Solid performance continues • Government proposed 1.5% increase in reimbursement level for 2022 • Continuing lobbying efforts • Opportunities for industry consolidation • Some 2,000 more individuals, mostly children, expected entitlem
Slide 6: Active management secures long-term stability
Active management secures long-term stability • Growth of 5%, with organic growth of -1.2% explained by closed units and lower (seasonal) occupancy • Occupancy recovering during fall but still some way to go • Acquisition of Fideli Omsorg, operating over ten residential units and a strong pipeline o
Slide 7: Demand and occupancy recovering gradually
Demand and occupancy recovering gradually • Gradual increase in demand and occupancy • Two new units opened: • New OwM unit in Norrtälje • New contracted business in Örebro • Continued work with four openings from earlier in the year • The pandemic is well under control but preventive measures conti
Slide 8: Focus shifting to development and growth
fjsökdfösjsdfs Focus shifting to development Finland and growth • Stable performance in Finland • Operating margin of over 8% • Occupancy improving in all segments impacted by the pandemic • Additional focus on organic growth, especially in I&F segments with ~10 new openings come 2022 Interim report
Slide 9: Strong operations in Norway
Strong operations in Norway • Strong performance continues – both financially as well as operationally • Strong organic growth of 11%, mainly driven by • Net customer intake in assistance (BPA) and disabled care (HOT) • Stable occupancy in I&F segments • During the quarter Humana continued to win se
Slide 10: CFO highlights Q3 2021
CFO highlights Q3 2021 • Financially another stable quarter; leverage in line with target and strong operating cash flow • Continued progress within digitalisation, supporting growth in assistance in Norway • In September, Humana used 769,200 shares as valuable consideration in an acquisition. As of
Slide 11: Operating revenue
Q3 Interim period Operating revenue 3,9% • An increase in revenues by 5.3% 6 078 5 849 • Personal Assistance, Norway and Elderly Care contributing 5,3% • Organic growth 3.0% (2.2) 1 931 2 034 • Acquired operations accounted for SEK 47m • Somewhat negative impact from Covid-19 • Lower occupancy in el
Slide 12: Profitability
Q3 Interim period Profitability • Operating margin 9.4% (8.9) in Q3 11,0% 411 411 • Operating profit increased by 11.5%, 370 adjusted operating profit also by 11.5% 353 • Personal assistance, Norway and 11,5% Finland contributing to the increase 192 192 172 172 • Covid-19 affected the profit margina
Slide 13: Personal Assistance
Revenue Profitability Personal Assistance • Revenue increased by 4.3% 4,3% • Organic growth was 2.4% (3.9) 736 767 • Higher reimbursement, partly offset 15,9% by fewer assistance hours 70 66 12 • Acquired operations contributed 60 57 10 50 • Operating profit increased by 15.9% 8 40 • Operating margi
Slide 14: Individual & Family
Profitability Individual & Family Revenue • New units and acquisitions drive 5,0% revenue increase 548 522 -0,8% • Revenue increased by 5.0% 70 69 • Organic growth of -1.2% (-1.3). 70 14 60 12 • Operating profit decreased by 0.8% 50 10 • Operating margin was 12.7% 40 8 (13.4) 30 6 • Discontinued uni
Slide 15: Elderly Care
Revenue Profitability Elderly Care • Revenue increased by 15.4% 15,4% • Organic growth was 15.7% (2.8) 173 -35,8% • Operating margin was 1.9 % (3.3) 150 5 5 12 • Improved results for contracted 4 10 units and established units under 3 8 own management contributed 3 6 • Lower occupancy due to Covid-1
Slide 16: Finland
Revenue Profitability Finland • Revenue decrease of 1.1% -1,1% • Organic growth was 0.4% (-1.3%) 318 314 • Organic growth is primarily driven 9,8% by an increased demand in the 30 26 12 outpatient care 25 24 10 • Operating profit increased by 9.8% 20 8 • Operating margin was 8.4% (7.6) 15 6 • Improv
Slide 17: Norway
Revenue Profitability Norway • Revenue increase of 12.6% 12,6% • Organic growth was 10.8% (11.9) 225 200 • Increase in customers in personal 48,3% assistance and the care home 35 14 31 segment 30 12 25 10 • Operating profit increased by 48.3% 21 20 8 • Operating margin for the quarter 15 6 was 13.8%
Slide 18: Central costs
Q3 Central costs Q3 Q3 • Underlying central costs slightly SEK m 2020 2021 below previous year Underlying central costs 21 22 • Positive effects of IFRS 16 of Acquisition related costs 0 1 SEK 18m on central costs (and operating profit) in the quarter Effects of IFRS 16 -15 -18 Sales of real estate
Slide 19: Financial position
Financial position Leverage, development • Interest-bearing net debt increased, year-on-year, by SEK 604m to SEK 4,153m (3,549) • Net debt increased due to 8 7,1 investments in new units and 7 6 5,7 6,0 5,4 reduced cash 5,2 5 4,6 4,5 4,3 4,4 4,5 4,6 4 • Leverage, interest-bearing net debt 3 in relat
Slide 20: Cash flow
Operating cash flow Cash flow • Operating cash flow SEK 180m (146) • The strong cash flow is mainly due to improved profit and SEK m Q3 2020 Q3 2021 decreased working capital Operating profit 172 192 • Cash flow for the quarter SEK -42m Depreciation 94 101 (30), where Changes in working capital -101
Slide 21: Financial targets and development
Financial targets and development Revenue growth Profitability Capital structure 200 10 16 8 14 160 8 7 12 6,0 6 10 120 6 5,4 5,2 8 192 5 4,6 4,5 4,5 4,6 80 176 172 4 4,3 4,4 6 4 3,2 3,8 3,4 3,4 3,0 98 100 101 112 107 4 2,8 2,4 40 2 2,2 71 3 2 45 0,7 0 0 0 2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q2 Q3 Q4 Q1 Q2
Slide 22: Summary
Summary ✓ Q3 2021- another solid quarter ✓ Pandemic well under control. Demand and occupancy rates gradually recover ✓ Humana continued to grow organically driven primarily by Norway and Eldery Care ✓ Improved operating profit ✓ Strong cash flow ✓ Several accretive acquisitions and a strong M&A pipe
Slide 23: Thanks!
Thanks! Financial calendar Further information Year-end report Jan-Dec and Q4 2021 10 Feb 2022 Anna Sönne, Director Marketing Communications Interim report Jan-Mar, Q1 2022 5 May 2022 +46 70 601 4853, anna.sonne@humana.se 2022 Annual General Meeting 10 May 2022 e