Slide 1: IDH Results Presentation
IDH Results Presentation June 2022
Slide 2: Contents
Contents: • IDH At a Glance • Q1 2022 Results Overview • Key Investment Highlights • Our Market • Our Business Model • Financial Position and Performance • Growth Strategies • Governance 2 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 3: Who We Are
Who We Are Integrated Diagnostics Holding is a leading, fully-integrated provider of high-quality medical diagnostic services with a footprint spanning Egypt, Jordan, Sudan and Nigeria Our Services Our Brands Accreditations Immunology Radiology Hematology Clinical Molecular Endocrinology Chemistry B
Slide 4: Our Geography
Our Geography IDH currently operates the largest branch network amongst private providers in Egypt and boasts an established presence in three key markets in the Middle East and Africa Jordan 1979 472 #1 79% 8.5 mn 29.7 mn Egypt Market Ranking1 Share of First began Branches (49% in Patients served T
Slide 5: Our Patients
Our Patients IDH serves two principal types of patients: contract and walk-in Around 70% of total revenue generated across the two segments is paid in cash Contract Patients Walk-In Patients IDH’s contract clients include institutions who enter into one-year IDH’s walk-in clients, also referred to a
Slide 6: 2021 in Review: A new chapter (I/II)
2021 in Review: A new chapter (I/II) During the past twelve months, IDH has transformed its business, rethinking its service offering and delivery capabilities, and setting the foundations for a new chapter of sustainable growth Test Offering and Reach Agility Delivery and Visibility Conventional Bu
Slide 7: 2021 in Review: A new chapter (II/II)
2021 in Review: A new chapter (II/II) During the past twelve months, IDH has transformed its business, rethinking its service offering and delivery capabilities, and setting the foundations for a new chapter of sustainable growth Improved Long-term Efficiency Relationships Decreased Turnaround Times
Slide 8: Q1 2022 Results Overview
Q1 2022 Results Overview 8 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 9: Important Notice
Important Notice Treatment of Revenue Sharing Agreements and Use of Alternative Performance Measures As part of IDH’s efforts to support local authorities in Egypt and Jordan in the fight against the pandemic, Biolab (IDH’s Jordanian subsidiary) secured several revenue-sharing agreements to operate
Slide 10: Results Snapshot
Results Snapshot IDH kicked off 2022 delivering sustained growth in conventional net sales supported by rising test volumes EGP 1,117 mn Net Sales in Q1 2022 EGP 532 mn EGP 468 mn EGP 314 mn ▼ 1% y-o-y Gross Profit in Q1 2022 EBITDA1 in Q1 2022 Net Profit in Q1 2022 (Revenue of EGP 1,180 mn in 1Q22,
Slide 11: Return to Sustainable Growth
Return to Sustainable Growth IDH’s conventional business has completed a full recovery from lows related to Covid-19, growing at a solid 8% year-on-year in Q1 2022 Conventional net sales now growing solidly supported by higher Conventional revenue per test increased a healthy 2% year-on-year in volu
Slide 12: Profitability in line with Historical Averages
Profitability in line with Historical Averages Margins at all levels of profitability normalised and stood in line with the Group’s pre-pandemic averages Gross profitability in line with pre-pandemic averages EBITDA level profitability aligned with long-term targets (GP, GPM* | EGP, %) (EBITDA, EBIT
Slide 13: Solid Group Profitability in Q1 2022
Solid Group Profitability in Q1 2022 Margins recorded in line with Group’s historical averages during the first three months of the year IDH Cost of Net Sales Breakdown | EGP mn / % of net sales IDH Consolidated Gross Profit | EGP mn / % of net sales As a percentage of net +19% -17% Gross Profit rec
Slide 14: Net Sales/EBITDA Bridge
Net Sales/EBITDA Bridge Drop in EBITDA margin trickled-down from GPM, topped by increase in admin expenses and additional marketing spending related to BG Scan IDH Q1 2021 Detailed Net Sales/EBITDA Bridge| EGP mn, % of net sales Egypt Profit share: EGP 41 million, Rest: EGP 135 million 53% 1,130 (21
Slide 15: EBITDA/Net Profit Bridge
EBITDA/Net Profit Bridge Doubling of interest income thanks to our strong cash balance and the allocation to t-bills has positively affected the effective tax rate reaching 33% vs 35% during the same period last year Q1 2022 EBITDA/Net Profit Bridge | EGP million 468 45 2 61 (33) (72) 253 (157) Q1 2
Slide 16: Solid Financial Position
Solid Financial Position The Group maintains a robust financial position, with a liquid balance sheet thanks to a strong cash generation profile allowing for consistent dividend payouts Consolidated Cash Balance | EGP mn Net Cash Balance* | EGP mn Gross Fixed Assets | M-EGP +13% +16% 2,659 1,724 1,7
Slide 17: Quarter-on-Quarter Progression
Quarter-on-Quarter Progression The Group witnessed sustained quarter-on-quarter growth in the first nine months of 2021. Declining net sales and profitability in Q4 2021 and Q1 2022 reflect a quarter-on-quarter fall in Covid-19-related net sales IDH Quarterly Net Sales Evolution | M-EGP, Q-o-Q % Gro
Slide 18: Segment Performance
Segment Performance IDH’s contract segments recorded a strong start to the year supported. At the walk-in segment net sales, which declined in the quarter, remained well above pre-Covid-19 levels. Walk-in Segment Contract Segment Total 1Q21 1Q22 Change 1Q21 1Q22 Change 1Q21 1Q22 Change Net sales^ (E
Slide 19: Segment Performance
Segment Performance The contract segment continued to contribute the lion share of both patient volumes and consolidated revenues in Q1 2022 Revenue Split Patient Split Q1 2021 Q1 2022 Q1 2021 Q1 2022 34% 37% 42% 47% 53% 58% 66% 63% Walk-in Corporate Walk-in Corporate Walk-in Corporate Walk-in Corpo
Slide 20: Regional Performance
Regional Performance IDH witnessed strong results from its operations in Egypt, Jordan and Nigeria, with its Sudanese operations impacted from the sharp devaluation of the Sudanese pound in February Revenue | EGP mn Adj. EBITDA** | EGP mn / %*** 522 Lower revenues in Egypt were attributable to a fal
Slide 21: Echo-Lab (Nigeria)
Echo-Lab (Nigeria) IDH’s Nigerian operations reported year-on-year revenue growth of 19% in Q1 2022. Top-line growth was supported by a 25% year-on-year increase in average revenue per test which came on the back of a rise in demand for the generally higher-priced MRI and CT testing Monthly Revenue
Slide 22: COVID-19-adapted Service Offering
COVID-19-adapted Service Offering Net sales in Egypt and Jordan were supported by both IDH’s Covid-19-related* test offering and its house call service. Covid-19 Testing Contribution to IDH Net Sales 1Q22 House Call Contribution to IDH Net Sales 1Q22 5% 18% EGP Conventional Testing EGP 38% 1,117 Cor
Slide 23: Continued Ramp up at Al Borg Scan
Continued Ramp up at Al Borg Scan Al Borg Scan offers a full range of radiology services, including EGP 17 MN 23.9k 30.8k EGP 550 EGP 707 but not limited to Magnetic Resonance Imaging (MRI), Computed Tomography (CT), Ultrasound, X-ray and Q1 2022 Revenue Q1 2022 Patients Q1 2022 Tests Q1 2022 Q1 202
Slide 24: 2022 Outlook and Strategy
2022 Outlook and Strategy IDH is looking to build on a strong start to the year to continue delivering exceptional value to its patients, shareholders, and wider communities, and drive solid growth across the business FY 2022 Guidance Growth Drivers Al-Borg Scan Nigeria Pakistan Conventional busines
Slide 25: Investment Highlights
Investment Highlights 25 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 26: Investment Highlights
Investment Highlights IDH is an attractive investment opportunity with compelling fundamentals, present in fast- growing, under-served markets Operating in highly fragmented markets characterised by 1 strong structural growth drivers and high barriers to entry Deploys an asset-light business model t
Slide 27: Fast-Growing, Underserved Markets
Fast-Growing, Underserved Markets 27 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 28: Favorable Industry Dynamics
Favorable Industry Dynamics IDH’s home market of Egypt is underpinned by robust structural growth drivers Lab tests per capita (2012) 23.2 High Disease Burden Operating in a still under-penetrated The Egyptian population is marked by a high incidence of market 10.1 lifestyle-related medical conditio
Slide 29: Favorable Industry Dynamics
Favorable Industry Dynamics IDH’s markets are characterised by high barriers to entry Economies of Scale Accreditation of Facilities Brand & Reputation Market Reach Key Stakeholder Relationships IT-enabled platform, Attracting patients Patients are loyal to Fragmented markets Building a scalable cri
Slide 30: IDH is a Consumer-Facing Service Provider
IDH is a Consumer-Facing Service Provider The mechanics of healthcare markets in developing economies are markedly different from those in many Western healthcare industries Private Healthcare Systems in Developing Economies IDH serves the private healthcare A hospital outpatient clinic or Perceived
Slide 31: Scalable Business Model
Scalable Business Model 31 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 32: Asset-light Business Model
Asset-light Business Model IDH’s “Hub, Spoke and Spike” business model enables the Company to organically expand its reach in highly-fragmented markets with underserved diagnostic services demand Mega Lab: “Hub” • The Mega Lab, the largest automated lab in Egypt, serves as IDH’s diagnostic “Hub,” eq
Slide 33: Our Mega Lab
Our Mega Lab IDH’s Mega Lab provides a robust platform to support rapid, cost-effective growth Capabilities Quality Control • Mega Lab machines are capable of conducting a wide range of tests including basic blood grouping to advanced gene sequencing. • New and esoteric test facilities at the Mega L
Slide 34: Key Supplier Relationships
Key Supplier Relationships IDH leverages its bargaining power with suppliers to maximize value in a business that is fundamentally about economies of scale. Combined with the long-tenure nature of its supplier contracts, this provides significant protection against short-term price fluctuations. Dyn
Slide 35: Strong Growth and Financial Position
Strong Growth and Financial Position 35 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 36: Key Financial Performance Indicators
Key Financial Performance Indicators Since the Company’s IPO on the LSE in 2015, IDH has delivered consistent top- and bottom-line growth supported by a steady increase in volumes and increasingly favourable pricing across the Group’s service offering Net Sales* | EGP mn - CAGR Gross Profit – GPM**
Slide 37: Regional Performance
Regional Performance Across its footprint, the Company deploys tailored expansion strategies which enable it to continue driving growth irrespective of the prevailing macroeconomic environment Share of 2021 Net Sales Revenues* (EGP mn) ▲89% IDH is in a strong competitive position in the 4,108 Egypti
Slide 38: Growth Strategies
Growth Strategies 38 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 39: Future Growth Strategies
Future Growth Strategies IDH’s growth strategies rely on leveraging its competitive advantages to achieve four strategic goals Expand Customer Expand Reach Geographically In addition to organic expansion, the Company Beyond opening laboratories in new continues to seek value-accretive acquisitions g
Slide 40: Expanding Customer Reach – Growing In Egypt
Expanding Customer Reach – Growing In Egypt The Group enjoys ample growth room in Egypt thanks to its market leading position and extensive reach, attractive underlying fundamentals, and favourable regulatory environment Reach and penetration Solid Fundamentals Universal Healthcare Act Forecasted GD
Slide 41: Diversifying Service Offering – Al Borg Scan Expansion Updates
Diversifying Service Offering – Al Borg Scan Expansion Updates Al Borg Scan’s operates five branches, two of which were inaugurated in 2021 and a third in March 2022. The Group is actively working towards obtaining ACR (American College of Radiology) accreditation for Al Borg Scan’s branches, a proc
Slide 42: House Call Services (Egypt and Jordan)
House Call Services (Egypt and Jordan) IDH’s house call services, offered in both Egypt and Jordan, enable the Company to provide its services to patients’ doorstep at the touch of a screen Expands IDH’s customer base Expands reaching new segments of the House call services witnessed rising demand R
Slide 43: Expanding Customer Reach – State-sponsored Initiatives
Expanding Customer Reach – State-sponsored Initiatives IDH’s nationwide presence and strong brand equity position it well to benefit from state- sponsored campaigns to increase awareness of preventative healthcare with diagnostic testing Duration Revenue Generated “100 Million Healthy Lives” campaig
Slide 44: Expanding Customer Reach – IDH Awareness Campaigns
Expanding Customer Reach – IDH Awareness Campaigns Parallel to state-sponsored initiatives, IDH also runs its own awareness campaigns focusing on specific diseases on a monthly basis and offering discounts on related testing IDH’s PCR Offers and Campaigns Discounts on PCR testing for Covid-19 PCR te
Slide 45: Diversifying Service Offering – New Investment in Wayak
Diversifying Service Offering – New Investment in Wayak IDH launches new subsidiary “Wayak” to offer data-driven healthcare services, utilising data analytics and artificial intelligence to capitalise on IDH’s database of over c.13 million patients Wayak Services Medication to be Service provider On
Slide 46: Growing Geographic Footprint– Investment Rationale
Growing Geographic Footprint– Investment Rationale IDH’s regional expansion strategy targets acquisitions in African, Middle Eastern and Asian markets where it can deploy its proven business model and generate accretive value Growing economies and strong demographics Similar healthcare market struct
Slide 47: Growing Geographic Footprint – Nigeria Expansion
Growing Geographic Footprint – Nigeria Expansion In December 2017, IDH further expanded its geographical footprint with an investment in Nigeria, a value-accretive acquisition in a large, fragmented and underpenetrated diagnostic services market where our business model is well-suited to capitalise
Slide 48: Nigeria Expansion Updates
Nigeria Expansion Updates Operational progress in Nigeria expansion with existing branches being refurbished and renovated and with loss-making branches being relocated or closed. In parallel, the Group is actively seeking to optimise its offering, pushing its radiology and pathology services. Branc
Slide 49: Nigeria Branch Roll-Out and Renovations
Nigeria Branch Roll-Out and Renovations Opebi Branch Renovation and Rebranding New Victoria Island Branch Area 11 Branch Renovation and Rebranding Benin Branch Renovation & Rebranding 49 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 50: Growing Geographic Footprint – Pakistan Update
Growing Geographic Footprint – Pakistan Update In December 2021, IDH signed a sale and purchase agreement to acquire 50% of Islamabad Diagnostic Centre, one of Pakistan's leading diagnostic providers, for a total consideration of US$ 72 million About IDC About Pakistan 85 3.1mn +1.6mn US$ 46mn +200m
Slide 51: Strong Leadership & Governance
Strong Leadership & Governance 51 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 52: Governance
Governance A World-Class Board of Directors The majority of members of IDH’s Board of Directors are independent and offer significant experience in the healthcare market, MENA region and investment activities Lord St John of Bletso 1 Prof. Dr. Hend El Sherbini Hussein Choucri 1,2,3,4 Independent Non
Slide 53: Governance
Governance IDH is committed to implementing best practices in corporate governance through the expertise of both the individual Directors and outside parties Internal Audit Procedures While not required to comply Anti-Bribery and Anti Corruption Policy (ABAC) with UK Corporate Governance The Board
Slide 54: Sustainability
Sustainability Founded on the principle of providing quality medical assistance and services to better the lives of individuals and the community at large, IDH views corporate responsibility initiatives as an extension of its core purpose with the aim of improving communities in which it does busine
Slide 55: Appendix
Appendix 55 INTEGRATED DIAGNOSTICS HOLDINGS
Slide 56: IDH Development Story
IDH Development Story Over 40 years of industry experience, complemented by strategic expansion to develop a strong market position across products and geographies. Today IDH has built a scalable platform that is positioned for further strong growth 1979 1990 2008 2011 2012 Establishment of MK Lab A
Slide 57: Covid-19 Internal Protocols and Preventative Measures
Covid-19 Internal Protocols and Preventative Measures In light of the recent covid-19 global outbreak, IDH, in line with World Health Organization (WHO) guidelines, has implemented detailed internal protocols to guarantee the safety of its staff and patients and safeguard its operations. IDH’s respo
Slide 58: IDH
INTEGRATED DIAGNOSTICS HOLDINGS IDH