Evolent Health, Inc · NYSE:EVH
Evolent Health — Merger or Acquisition (June 2022)
16 slides from Evolent Health's merger presentation, Jun 29, 2022
Slide 1: Accelerating Evolent's Market Leadership in Value-Based Care
1 Accelerating Evolent’s Market Leadership in Value-Based Care June 29, 2022
Slide 2: Safe Harbor Statement
2 Safe Harbor Statement Certain statements made in this presentation and in other written or oral statements made by us or on our behalf are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). A forward-looking statement is a statement t
Slide 3: Evolent Health: A Leader in Value-Based Care Solutions
3 FINANCIAL OVERVIEW (as of 12/31/21)WHO WE ARE • Technology-Driven Solutions For Health Plans and Providers That Improve Health Outcomes and Lower Costs • Fast Growing, Seasoned Leader in Value-Based Care Solutions with Positive Annual Cash Flow (as of 12/31/21) • Focus on Driving Healthcare Value
Slide 4: Evolent Health to Acquire IPG
4 Evolent Health to Acquire IPG • A leader in providing surgical management solutions for musculoskeletal conditions • Founded in 2004 and headquartered in Atlanta, GA; majority owned by TPG Growth • Currently serves 8 health plan payers across 27 markets • Expected 2022 Financial Metrics • Revenue:
Slide 5: The Case for Tackling MSK
5 $291 $253 $170 MSKCardiology Oncology 189%2,000 2014 2030 0 1,000 3,000 500 1,500 2,500 Knee Hip US Health Expenditures1 Total Joint Replacements2 $ Billions Annual Procedures (Thousands) 171% MSK represents the 2nd largest specialty by spend in the US… … with strong growth projected, particularly
Slide 6: IPG's Model Focused on Major Drivers of Surgical Spend Within MSK
6 IPG’s Model Focused on Major Drivers of Surgical Spend Within MSK IPG drives significant savings on surgical spend, focused on MSK procedures, through partnering with plans and providers to optimize where a procedure takes place and what device is selected Industry-leading IP based on 18+ years of
Slide 7: Illustrative Depiction of the IPG Operating Model
7 Illustrative Depiction of the IPG Operating Model Health Plan Device Manufacturer Physician IPG contracts with device manufacturer and pays for device that surgeon chooses IPG engages with physician to ensure optimal site-of-care and device selection IPG contracts with plan to provide value-based
Slide 8: Value Proposition
8 Value Proposition Payer Member ASC Surgeon Device Manufacturer • Significant cost savings in high-trending category • No provider or member abrasion • Lower out-of-pocket costs for surgery • More convenient with fewer delays or surgeries being rescheduled • More volume, particularly from higher-ac
Slide 9: IPG Brings Strong Partner Relationships with Significant Growth Runway
9 IPG Brings Strong Partner Relationships with Significant Growth Runway 100% CUSTOMER RETENTION RATE 8 Years AVERAGE CUSTOMER TENURE 98% FACILITY PARTNER SATISFACTION ~20% ORGANIC GROWTH RATE 6% CURRENT ASC FACILITY PENETRATION1 1) IPG ASCs today as a percentage of total ASCs within IPG’s specialty
Slide 10: Value Vision to Maximize the Value of IPG within Evolent
10 Value Vision to Maximize the Value of IPG within Evolent Time Execute on organic growth runway within IPG accounts Cross-sell within the Evolent partner portfolio Focus integrated sales team on priority new logos Build out Performance Suite offering for MSK based on IPG model Extend into new LOBs
Slide 11: Creating a Leading Value-Based Specialty Care Solutions Platform
11 Oncology Cardiology End-of-Life Musculoskeletal Performance Suite Tech & Services COMBINEDNCH IPG Clinical Area Creating a Leading Value-Based Specialty Care Solutions Platform Medicare Medicaid Commercial LOB Mix Product Mix COMMENTARY • Top 3 specialties1 by spend in U.S. healthcare as well as
Slide 12: Evolent: Accelerating Our Market Leadership In Value-Based Care
12 Evolent: Accelerating Our Market Leadership In Value-Based Care Revenue Growth ✓ $140 million of incremental clinical revenue anticipated in 2022 ✓ IPG is a growth business with annual revenue increases expected of 20%+ ✓ Cross-sell and other revenue synergies Accelerate Margin Expansion ✓ 18% Ad
Slide 13: Summary Financing Terms and Outlook
13 Summary Financing Terms and Outlook • Evolent expects to utilize $25 million of cash on hand and proceeds from a newly committed, $225 million Five-Year Senior Credit Facility to be entered at closing to finance $250 million of the $375 million of upfront consideration to complete the IPG acquisi
Slide 14: Why Evolent Health? Investment Considerations
14 Why Evolent Health? Investment Considerations Execution Drives Shareholder Value Efficient Capital Allocation Strong and Expanding Margins Compelling Long-Term Organic Growth Commitment to Shareholder Value
Slide 15: Non-GAAP Financial Measures
15 Non-GAAP Financial Measures In addition to disclosing financial results that are determined in accordance with GAAP, we present and discuss certain non-GAAP financial measures, as supplemental measures to help investors evaluate our fundamental operational performance. Net Debt is defined as the
Slide 16: Appendix A – Evolent Health, Inc. Adjusted EBITDA Reconciliation
16 Appendix A – Evolent Health, Inc. Adjusted EBITDA Reconciliation Consolidated 2021 ($ in millions) 2021 Clinical Solutions Evolent Health Services Corporate Net loss attributable to common shareholders of Evolent Health, Inc. $(37.6) $60.7 $(9.4) $(88.8) GAAP Margin (4.1)% 10.1% (3.0)% Less: Inte