Terveystalo Oy Class A · OMXHEX:TTALO
Terveystalo Oy Class A — Q4 2019 Earnings Presentation
28 slides from Terveystalo Oy Class A's earnings presentation, Feb 13, 2020
Slide 1: Strong revenue growth and profitability – Result briefing 2019
STRONG REVENUE GROWTH AND PROFITABILITY RESULT BRIEFING 2019 President and CEO Ville Iho terveystalo.com CFO Ilkka Laurila #terveystalo
Slide 2: A year of financial and operational excellence
A year of financial and operational excellence +6% +60% +103.9% 150 1 100 30 4 3.5 3.7 150 1 030.7 1 000 3 94 100 900 25 2 50 800 1 744.7 689.5 20 0 0 700 2018 2019 2018 2019 600 547.0 *Phycisian appointments, mill. Remote appointments, k. 505.6 15 500 11.8 11.2 10.0 10.4 10.6 +5.5 37% 400 10 72.4 1
Slide 3: Quality is at the core of our operations
QUALITY IS AT THE CORE OF OUR OPERATIONS
Slide 4: Optimize traditional care chain model with intelligent customer flow management
We aim to optimize our traditional care chain model with intelligent customer flow management Customer ’System layer’ groups to optimize customer flows Traditional value creation model Physician appointments Other professionals Corporate Optimize who, what Laboratory and when Imaging What does the c
Slide 5: Case S Group: Supporting mental health with Terveystalo
Case S Group: Supporting mental health with Terveystalo February 13, 2020 Sanna-Mari Myllynen, Director, HR, S Group 5 May 22, 2017 Sanna-Mari Myllynen, human resource management at S Group
Slide 6: Wide service range is a huge resource
Wide service range is a huge resource Number one in department stores Number one grocery store Finland’s most responsible bank and beauty ~1,000 outlets Sales volume €8.2 billion 21 Sokos department stores Sales €290 million ~1,000 outlets 3.0 million customers 46% market share 38 Emotion beauty sto
Slide 7: Largest private employer in Finland
Largest private employer in Finland Gender distribution Employment types Number of employees IN THE S GROUP 40,100 IN FINLAND 38,000 76% 24% FEMALE MALE Age distribution IN RUSSIA AND ESTONIA Nationalities UNDER 2,100 THE AGE OF 25 23% SUPERVISORS 76 OVER THE AGE OF 2,500 55 AVERAGE AGE 10% 36 SHARE
Slide 8: Mental disorders largest cause for sickness allowance days in Finland
In 2018, mental disorders became the largest cause for sickness allowance days in Finland Mental disorders 8
Slide 9: S-Group and Terveystalo found a model to turn the negative trend
Working together, S-Group and Terveystalo have found a model to turn the negative trend for mental disorders and sickness absences • Terveystalo has participated in S-Group’s Nuori Mieli Työssä (“Young mind at work”) program, that aims to develop new ways to meet the challenge of growing mental heal
Slide 10: The investment has been profitable to the employer
In addition to helping individual employees, the investment has been profitable to the employer • Thanks to this program and our close cooperation, we’ve had good results in pilot projects in all S-Group companies that have widely introduced the mental support model • Case SOK (1700 employees), year
Slide 11: Lessons learned and a challenge for all operators
Lessons learned and a challenge for all opeartors • Successful cooperation calls for joint development and seamless cooperation when working towards shared targets • No single entity, such as the individual, employer, supervisor, organization or occupational health care, can solve the this problem a
Slide 12: Q4 Highlights
Q4 HIGHLIGHTS Broad scale growth across all customer groups New processes and digital solutions improved access to care Profitability (EBITA margin) remained at a strong level Strong cash flow from operating activities, investments in digitalisation continued to grow A dividend of EUR 0.26 (0.13 + 0
Slide 13: Q4: Strong organic growth and Attendo deal increased revenue
Q4: Strong organic growth and Attendo deal increased revenue significantly Strong growth in all customer groups Q4 Revenue by payor group, M€ • In corporate customer group, strong growth +37% 300 continued in preventive occupational health 270 services and well-being services. Mental well- being ser
Slide 14: Q4: Strong profitability
Q4: Strong profitability • Adjusted EBITA before IFRS 16 impact EUR 31.9 million (27.1) • Adjusted EBITA % before IFRS 16 impact 11.8 % of revenue (13.7 %) • Profit for the period EUR 16.1 million (10.1) • The Board of Directors proposes that a dividend of EUR 0.13 per share be distributed and that
Slide 15: Market outlook
Market outlook • The market environment remains favorable in spite of weakened consumer confidence. • Corporate customers keep up a steady demand. Price competition is intensifying in certain customer groups in occupational health. At the same time, the relative share of preventive services is incre
Slide 16: Financial performance
FINANCIAL PERFORMANCE terveystalo.com #terveystalo
Slide 17: Increased scale, improvement in key corporate responsibility areas
Increased scale, improvement in key corporate responsibility areas Operations People Environment Economic Accident Mixed Tax footprint, *Customers, People working Units occurrence waste, tonnes mill. mill. at TTALO, k. rate +10.7% 0,0% +26% -4% -14% +59.3% 270 299 1,2 1,2 10,9 13,8 26 25 58 50 149 9
Slide 18: Strong profitability despite the Attendo deal and increased investments
Strong profitability despite the Attendo deal and increased investments in digitalization and IT Revenue, Adjusted EBITDA*, % Adjusted EBITA*, M€ and % Before IFRS 16 impact (comparable) Before IFRS 16 impact (comparable) 300 30 35 30 267.8 270.3 32.1 31.9 258.6 250 234.0 25 30 27.1 25 25.6 25.5 197
Slide 19: Operating leverage still applies, the scale has changed post Attendo
Operating leverage still applies, the scale has changed post Attendo M€ 10-12/2019 10-12/2018 Change, % 2019 2018 Change, % Revenue 270.3 197.9 36.6 1,030.7 744.7 38.4 Other operating income 0.8 0.7 15.1 2.1 18.2 -88.4 Materials and services -122.7 -93.5 31.2 -472.9 -351.3 34.6 Employee benefit expe
Slide 20: Impact of Attendo deal and IFRS 16 in the balance sheet
The impact of Attendo deal and the adoption of IFRS 16 is reflected in the balance sheet M€ 31.12.2019 31.12.2018 • Total assets of the Group amounted to EUR ASSETS 1,359.3 (1,162.3) million. The growth was mainly Property, plant and equipment 86.3 83.6 attributable to the adoption of IFRS 16. Right
Slide 21: Deleveraging continues, indebtedness well below the target
Deleveraging the balance sheet continues, indebtedness well below the target Net debt/adjusted EBITDA Operational efficiency is reflected in the (last 12 months) negative net working capital 3.8 150 3.3 3.2 100 6 6 6 6 3.0 5 6 6 5 2.7 50 90 110 101 101 102 2.5 82 72 73 2.1 2.0 0 -32 -38 -33 -51 -58
Slide 22: The share of intangible investments continues to grow
The share of intangible investments continue to grow (excluding M&A) Gross capex, M€ and %- of revenue Net capex, M€ and %- of revenue 45 44 4.3 4.3 4.3 4.3 4.3 4.2 4.3 45 4.0 41 4.5 45 4.0 4.5 3.9 41 40 3.7 38 4.0 40 3.6 3.7 3.7 38 4.0 11 35 18 3.5 35 12 3.5 31 30 31 16 30 29 14 29 14 30 3.0 30 27
Slide 23: Corporate responsibility is one of our strategic focus areas
Corporate responsibility is one of our strategic focus areas • The interest rate margin of our EUR 410 million financing agreement takes into account how we meet our targets for customer satisfaction, employee job satisfaction and wellbeing, and reduction in mixed waste: KPI Target in 2020 2019 act
Slide 24: Financial reporting and IR events and roadshows
Financial reporting and IR events and roadshows Financial reporting Upcoming IR events • In 2020, Terveystalo Plc will publish financial reports as follows: • 2 March Morgan Stanley European • Annual Report 2019 on week 9, 2020 MedTech & Services Conference , London • Interim report for January-Marc
Slide 25: Q&A
Q&A terveystalo.com #terveystalo
Slide 26: IFRS 16 impact on the reported figures
IFRS 16 impact on the reported figures 1-12/2019 1-12/2019 1-12/2019 1-12/2018 EUR mill. Reported IFRS 16 impact Before IFRS 16 impact Reported Revenue 1,030.7 - 1,030.7 744.7 EBITDA 171.2 39.9 131.3 116.6 Adjusted EBITDA 176.3 39.9 136.4 108.9 Depreciation -89.8 -38.3 -51.5 -41.1 Adjusted EBITA 115
Slide 27: Key figures
Key figures EUR million 10-12/2019 10-12/2018 Muutos, % 2019 2018 Muutos, % Revenue 270.3 197.9 36.6 1,030.7 744.7 38.4 Adjusted (EBITDA) * 1) 2) 47.8 32.5 47.1 176.3 108.9 62.0 Adjusted (EBITDA), % * 1) 2) 17.7 16.4 - 17.1 14.6 - 1) 2) EBITDA 46.8 26.6 76.2 171.2 116.6 46.9 EBITDA, % 1) 2) 17.3 13.
Slide 28: 2019: Solid growth in all customer groups
2019: Solid growth in all customer groups 2019 Revenue by payor group, % 2019 Revenue by payor group, M€ 1 200 +38% 1 031 29% 29% 1 000 204 800 745 0 91 81 +12.0 % 600 303 261 +16.2 % 400 +7.4 % 200 403 433 42% 0 2018 2019 Corporate Public excl. Attendo Private Public, Attendo share 28 © Terveystalo