Cleopatra Hospital Company · EGX:CLHO
Cleopatra Hospital — Cleopatra Hospitals Group — Q2 2022 Earnings Presentation
43 slides from Cleopatra Hospital's earnings presentation, 2022
Slide 1: Cleopatra Hospitals Group Investor Presentation 2Q 2022
Cleopatra Hospitals Group Investor Presentation 2Q’ 2022
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements, including, but not limited to, statements concerning expectations, projections, objectives, targets, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating
Slide 3: Contents
CONTENTS 1 Macro Environment & CHG Investment Story 2 Performance Review 3 Business Updates 4 Governance & Shareholder Information 5 Appendix
Slide 4: Our Mission & Values
Our Mission & Values — We put our patients first by providing high quality healthcare services with a focus on patient safety and quality of outcomes while enhancing the quality of life of our patients — We focus on creating sustainable growth with positive measurable impact on our stakeholders and
Slide 5: A Unique Investment Story
A Unique Investment Story • Leading integrated healthcare • Group-wide tenders in provider in Egypt with track pharmaceuticals and medical record of acquiring and consumables that drive scale cost integrating leading operating efficiencies and improve margins hospital assets • Scale volume benefits
Slide 6: A Diversified Healthcare Services Group
A Diversified Healthcare Services Group • Cleopatra Hospitals Group is Egypt’s first and largest private hospital group by number of hospital beds and operating hospitals and consists of six operational Other hospitals and two polyclinics in addition to a leading IVF Centre all in Cairo. The Outpati
Slide 7: CHG's Journey History & Timeline
CHG’s Journey History & Timeline The Evolution of CHG from a Single Asset into one of the Largest Hospital Platform in the Region The first asset and the Group’s Flagship CHG implements its first CHG announces Cleopatra Hospital, satellite feeder network to CHG signed a Letter of Intent brownfield p
Slide 8: Broad Network Coverage in Greater Cairo
Broad Network Coverage in Greater Cairo Leveraging a growing footprint, CHG continues to penetrate new segments of the population and provide high quality care to currently underserved areas of Greater Cairo Cleopatra Hospitals Group, is the largest private 9 hospital group in Egypt by number of bed
Slide 9: Diversified Service Offering and Revenue Stream
Diversified Service Offering and Revenue Stream CHG delivered a strong 1H2022 performance exceeding pre-pandemic levels in non-COVID-19- New Revenue Stream related business as of Q4 2020 71% 3% 18% 5% 3% OUTPATIENT IVF HOSPITALS* POLYCLINICS DIAGNOSTICS PHARMACY CHG operates six leading hospitals Th
Slide 10: Clearly Defined Core Growth Strategy
Clearly Defined Core Growth Strategy Integrating the platform to Leveraging payor and achieve higher efficiencies supplier relationships Geographic expansion in Egypt Enhancing utilization and linked to following optimizing existing capacity Establish centers of while expanding capacities and the ma
Slide 11: Healthcare Provider of Choice
Healthcare Provider of Choice Creating a one-stop-shop that is seamlessly integrated across all our assets comes as a result of the Group’s persistence in keeping our patients at the center of everything we do, while at the same time ensuring to drive value to all CHG’s key stakeholders. With that f
Slide 12: CHG 1H2022 Financial Highlights
CHG 1H2022 Financial Highlights CHG delivered a strong first half-year performance exceeding pre-pandemic levels in non-COVID-19-related business as COVID-19 contribution ends this quarter; margins stood in line with Group’s EGP 1,242 mn ↑16% Consolidated revenues in 1H2022 Non-COVID-19 related hist
Slide 13: 1H2022 in Review
1H2022 in Review Cleopatra Investor Presentation 2Q2022 13
Slide 14: Financial Performance in 1H2022
Financial Performance in 1H2022 CHG delivered a strong first half year performance exceeding pre-pandemic levels in non-COVID-19-related business as COVID-19 contribution continues ends; margins stood in line with Group’s historical averages and pre-pandemic levels. Management’s consistent cost cont
Slide 15: Direct vs. Indirect COVID Contribution
Direct vs. Indirect COVID Contribution Indirect COVID revenues include both, revenues generated by suspected COVID-19 patients at its regular facilities, as well as tests performed as part of the extraordinary protocols introduced during the pandemic (for example, chest CTs for all surgical patients
Slide 16: Patient Volumes Recovery Journey
Patient Volumes Recovery Journey The Group’s East and West Cairo polyclinics continue to outperform management’s expectations on all fronts, the Group’s polyclinics generated EGP 40mn in revenue during 1H2022, recording growth of 11% compared to the same period in 2021. This growth comes on the back
Slide 17: Group Revenue Contribution in H1 2022
Group Revenue Contribution in H1 2022 CHG reported revenues of EGP 1,241.7 million in the first half of 2022, 3% below last year’s figure. The year-on-year expansion comes despite very minimal COVID-19-related revenues in parallel to strong growth across its non-COVID-19 business service offerings.
Slide 18: Financial Performance of Flagship Hospitals
Financial Performance of Flagship Hospitals Cleopatra Hospital (CHC) Cairo Specialized Hospital (CSH) 935 238 459 225 491 764 748 450 374 365 167 677 33% 159 31% 44% 363 44% 32% 47% 324 44% 287 31% 42% 34% 30% 41% 43% 30% 34% 412 40% 318 349 197 215 281 129 150 71 73 144 138 112 57 48 87 2018 2019 2
Slide 19: Key Revenue Drivers (i)
Key Revenue Drivers (i) CHG reported revenues of EGP 1,242 million in the first half of 2022, 3% below last year’s figure. The slight decline comes on the back of a sharp drop in COVID-19-related revenues which was significantly offset by strong growth across its non-COVID-19 business. Throughout 1H
Slide 20: Key Revenue Drivers (ii)
Key Revenue Drivers (ii) Cases Served* expanded 6% year-on-year in 1H2022, with the Group serving over 508 thousand patients during the period. On a quarterly basis, cases served expanded by 2% versus 2Q2021. Despite an unfavorable macro environment coupled with almost a full decline in covid hospit
Slide 21: Capex Profile
Capex Profile Acquisition Investments: Medical & Renovation Capex: • El Katib (143mn Propco & 135mn Opco) Organic Acquisitions • Queens (25mn Opco) • Investments Across the Group’s Hospitals • IVF (2020) EGP 115mn Capex Capex Investments 5-year Historic Cumulative Capital Deployment Organic Capex Ac
Slide 22: Transformation Review
Transformation Review Cleopatra Investor Presentation 2Q2022 22
Slide 23: Transformational Approach
Transformational Approach Patient Operational Business Model Experience Efficiency Enhancements Systems Organic Volumes Digital Transformation & Processes & COEs Human Resources Further developing Focusing efforts on further establishing the Transformational personnel Leveraging technology & data co
Slide 24: M&A and Expansions Progress
M&A and Expansions Progress M&A & Expansions Projects 2021 2022 2023 2024 200 Bed Brownfield Management agreement terms and Completion of hospital’s remaining Hospital’s first year of operations (25 Project (Sky Hospital) conditions were signed and works years management contract) announced • Outpat
Slide 25: Expanding CHG's Presence to New Cairo
Expanding CHG’s Presence to New Cairo 6th October location 2021 Sky Hospital Project Sky Hospital Location New Cairo # of Beds ~200 Project Completion 2024 Cleopatra Investor Presentation 2Q2022 25
Slide 26: Market & Competition Analysis
Market & Competition Analysis Investment & Strategy Expand geographical presence in new underserved areas Patient Focused Marketing and product development Volume driven strategy aiming to attract both patients and cities (New Cairo , October) through Hospitals, with emphasis on patient experience,
Slide 27: The Group's Centers of Excellence
The Group’s Centers of Excellence Defining Centers of Excellence Select Examples of CHG’s Centers of Excellence Competitive Defined Scope & Sales Nursing & Residents Advantage & Focus Team Differentiation Consumables Medical Equipment & Payor Recognition Planning Technology Medical & Branding & Mark
Slide 28: Robotic Surgeries CoE
Robotic Surgeries CoE Advantages Vision On June 8, CHG became the first private healthcare provider in Egypt to introduce a robotic surgery unit within their network. Robotic surgeries are Increased Precision / Reduced a major step forward in the performance of advanced and complicated Risk Of surge
Slide 29: Expanding CHG's Digitalization Agenda
Expanding CHG’s Digitalization Agenda The Group recognizes digitalisation as a key driver for future growth. Over the last few years, CHG has embarked on a digital transformation strategy, which aims to introduce the latest digital solutions available to enhance all aspects of the Group’s day-to-day
Slide 30: Digital Transformation Approach
Digital Transformation Approach Cleopatra Investor Presentation 2Q2022 30
Slide 31: Leveraging on Clinysis' Successful Roll-Out
Leveraging on Clinysis’ Successful Roll-Out Patients’ Engagement Platforms Website Social Media CHG Mobile App CHG Video Call App Appointment booking is also available Allows patients to book appointments on CHG’s mobile app across all of its online at all CHG hospitals and clinics. facilities. Cent
Slide 32: Group's Website Overhaul
Group’s Website Overhaul Online Booking Access to Medical Records Patient will be able to book Provide patient access to own online on the system directly and medical record across the group will be able to see OPD slots as (lab. Rad, OPP visits, inpatient implemented in each hospital admission, ER,
Slide 33: Governance & Shareholder Information
Governance & Shareholder Information Cleopatra Investor Presentation 2Q2022 33
Slide 34: Governance (I)
Governance (I) The Group’s Board of Directors provides the necessary oversight and combination of expertise to thoroughly oversee the Group’s corporate governance framework, a cornerstone of the Group’s long-term success and value creation. Board of Directors The Group’s board of directors includes
Slide 35: Governance (II)
Governance (II) OPERATIONS ABC No Referral Fees Medical Council • CHG has a zero-tolerance approach to bribery and • CHG does not pay any referral fees or kickbacks to • CHG recently launched a group-wide medical council corruption with a clear anti-bribery and anti-corruption physicians and instead
Slide 36: CLHO Trading Analysis
CLHO Trading Analysis CHG’s 2022 Price Performance (Rebased to 100) Valuation Multiples CLHO Volume CHG EGX30 17.7x 13.3x 10.9x 115 EV/EBITDA 8.9x Valuation 110 Multiples (x) 105 100 95 FY 2019 FY 2020 FY 2021 Q2 2022 90 85 36.3x 25.6x 80 17.7x 19.5x P/E 75 Valuation 70 Multiples (x) Jan-22 Jan-22 J
Slide 37: Appendix
Appendix Cleopatra Investor Presentation 2Q2022 37
Slide 38: Balance Sheet and Leverage
Balance Sheet and Leverage Balance Sheet Summary Cash Flow Bridge for H1 2022 Balance Sheet Summary (EGP 000') Dec-21 June-22 Cash & Cash Equivalent 846 328 Cash Flow Bridge in EGPM Inventory 51 70 Debtors and other debit balances 576 589 Current Assets 1,473 987 Intangible Assets 426 424 Non-Curren
Slide 39: Cash Conversion Cycle
Cash Conversion Cycle Days Inventory Outstanding (DIO) Days Credit Sales Outstanding (DSO) DIO DSO 46 88 40 84 77 33 Jun-21 Dec-21 Jun-22 Jun-21 Dec-21 Jun-22 Days Payables Outstanding (DPO) Cash Conversion Cycle DPO Cash Conversion Cycle 24 120 100 101 15 8 Jun-21 Dec-21 Jun-22 Jun-21 Dec-21 Jun-22
Slide 40: Consolidated Income Statement
Consolidated Income Statement All figures in EGP mn 2Q2021 2Q2022 % change H12021 H12022 % change Revenues 643.6 604.8 -6% 1276.8 1241.7 -3% Cost of sales (404.1) (412.6) 2% (796.1) (827.6) 4% Gross profit 239.5 192.1 -20% 480.7 414.1 -14% Gross Profit Margin 37% 32% 38% 33% General & administrative
Slide 41: Consolidated Balance Sheet
Consolidated Balance Sheet All figures in EGP mn 31 December 2021 30 June 2022 Non-current assets Fixed assets 1,351.7 1,401.6 Intangible assets 425.5 424.5 Right of use 174.7 161.3 Payment under investment 5.7 24.2 Investment in associates 2.2 2.2 Total non-current assets 1,959.8 2,013.7 Current as
Slide 42: Consolidated Cashflow Statement
Consolidated Cashflow Statement All figures in EGP mn 30 June 2021 30 June 2022 Cash flow from operating activities: Profit before tax 278.7 219.6 Adjustments for: Depreciation 54.5 63.4 Right of use depreciation - - Amortization of intangible assets 7.9 7.9 Allowance for impairment of current asset
Slide 43: Thank you
Thank you INVESTOR RELATIONS CONTACTS SHAREHOLDER INFORMATION Telephone: +2 01000077893 EGX: CLHO.CA E-mail: waleed.hamed@cleohc.com Listed: June 2016 https://www.cleopatrahospitals.com/en/investors/ Shares Outstanding: 1.6 billion Cleopatra Investor Presentation 2Q2022 43
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