AfroCentric Investment Corporation Limited · JSE:ACT
AfroCentric Investment — FY2021 Earnings Presentation
28 slides from AfroCentric Investment's earnings presentation, September 2021
Slide 1: Annual Results Presentation
ANNUAL RESULTS PRESENTATION 21 for year ended June 2021 1
Slide 2: Agenda
Agenda Business context 1 Business highlights 2 Our business is focused on making a sustainable impact Strategy update 3 in the area we know best – healthcare. OUR Segmental performance review 4 BUSINESS Group financial highlights 5 ANNUAL RESULTS PRESENTATION HEALTHIER TOGETHER for year ended 30 Ju
Slide 3: Our Business in Context
OUR BUSINESS IN CONTEXT Group Chairperson| Dr. Anna Mokgokong
Slide 4: Creating Value Through Purpose
Review and positioning We play a significant role in society by transforming healthcare. DEMONSTRATING PURPOSE AND RESILIENCE Stability created through our diversified business model CREATING VALUE THROUGH HEIGHTENED FOCUS ON BROADER VALUE PURPOSE Support to vulnerable parts of society through its e
Slide 5: Business Highlights
BUSINESS HIGHLIGHTS Group CEO| Ahmed Banderker
Slide 6: 2021 Business highlights
2021 Business highlights Solid financial performance despite challenging trading conditions The Group’s deliberate +9.9% +25.8% +15.5% +7.2% diversification strategy is Normalised Operating Headline particularly Revenue profit earnings headline evident when earnings measuring the impact of the R8 07
Slide 7: Supporting our stakeholders during COVID
Supporting our stakeholders during COVID Supporting Protecting Supporting Supporting members members providers society Providing access to credible information Targeted engagement to mitigate Collaboration with healthcare Engaging industry players to play a through multiple interventions for infecti
Slide 8: Insights on the pandemic
Insights on the pandemic Pathology tests Admissions and conducted deaths experience Tests covered Cumulative admissions Cumulative deaths 120 000 Total Total 20.35% +1mil 100 000 admissions deaths 80 000 >100k >15k 60 000 40 000 79.65% 20 000 - Negative Tests Positive Tests R868 million spent to cov
Slide 9: COVID-19 Vaccinations
COVID-19 Vaccinations Vaccinations by age band %Vaccinated %Not Vaccinated < 18 100% 18-34 10% 90% 35-49 25% 75% 50-59 27% 73% >= 60 56% 44% 5% growth in vaccinations between July and August 2021. 46% of our people have been vaccinated thus far Medscheme Data as date: 07 September 2021 ANNUAL RESULT
Slide 10: Robust performance
Robust performance Our performance is underpinned by robust, value-enhancing governance and leadership SUSTAINED PERFORMANCE (R'000) Healthcare service operating profit Healthcare retail revenue 1 200 000 CAGR Revenue diversification 35.2% increase in revenue from the Pharma Cluster 1 000 000 +18.7%
Slide 11: Our business model is geared for value creation
Our business model is geared for value creation Integrated Smart Solutions Contribution Integrated Our Smart Fees Smart Service Smart Care Level Group Value Proposition Indicative Family Contribution Significant New hospital collective savings on premiums bargaining structures, discounted medication
Slide 12: Re-engineering the service model
Re-engineering the service model Data led approach for superior results Our capabilities in executing on our priorities Robotic Process Decision Services How we Automation do it Agile Project Management Data-driven Insights Concentration on improving the Improved Business Accuracy and Sustainability
Slide 13: Cluster highlights: Medical aid administration
Cluster highlights Our model optimises healthcare costs to deliver on our mission MEDICAL AID ADMINISTRATION, RISK MANAGEMENT AND TECHNOLOGY Managing clinical and financial risks for our client schemes Scheme membership 4.0m 3.8m 3.8m 3.8m 3.8m 3.9m 3.8m Over R2.7 billion in claims costs a diamond w
Slide 14: Cluster highlights: Pharmaceutical
Cluster highlights Our model optimises healthcare costs to deliver on our mission PHARMACEUTICAL Reduce medicine and related costs to improve access to affordable, quality Pharmaceutical cluster now generates 30% of the Group’s operating healthcare profit. Scripts Ave DOH Scripts Ave PVT Scripts Tot
Slide 15: Significant progress on strategic priorities
Significant progress on strategic priorities 2021 Corporate activity • DENIS, Forrester, Scriptpharm, Sanlam Gap 01 PROGRESS • Exit of Zimbabwe and eSwatini Tenders UPDATE Polmed, GEMS retention, Awarded COIDA contract 02 Significant Operational Improvement 15% growth in Services profit 03 Pharmaceu
Slide 16: Segmental Review & Financial Highlights
SEGMENTAL REVIEW & FINANCIAL HIGHLIGHTS Group CFO| Hannes Boonzaaier
Slide 17: Financial focus points
FINANCIAL FOCUS POINTS Our business model continues to generate value REVENUE DIVERSIFICATION WORKING CAPITAL MANAGEMENT Diversifying into other revenue streams through our various subsidiaries. R8 10.6% increase year-on-year although growth of 24% in sales for Pharma Cluster billion Group turnover
Slide 18: Highlights for the period ended June 2021
Highlights for the period ended 30 June 2021 Robust and pleasing performance given the operating context 9.9% Normalised headline earnings growth Sustained performance beyond our successful five-year growth JUNE 2021 15.5% Operating profit growth initiative with operating profit HIGHLIGHTS CAGR over
Slide 19: Three year view of profit before tax
Three year view of profit before tax Diversification delivers superior outcomes with significant opportunity for more integration Operating profit * Net cash finance income/ (cost) Depreciation/amortisation R1106.4m R'm 17% R'm 17 R'm 2019 Depreciation 2020 Amortisation 2021 29% 1 032 1021 (59) (62)
Slide 20: Resilience in membership
Resilience in membership Despite the economic constraint membership has not been significantly impacted Large scheme beneficiaries over Distribution of beneficiaries by time large schemes 2018 2021 3.4m 2 000 000 3.3m 1 500 000 1 000 000 3.2m 500 000 3.1m 2016 2017 2018 2019 2020 2021 - Bonitas Fedh
Slide 21: Segmented financial reporting: Medical aid administration
Segmented financial reporting structure Medical Aid Administration, Risk Management & Technology: Concentrating on improving the operational delivery model of services Revenue Operating costs Annotations R 3 834 R'm 17% R'm 21% RR3,108 3 207 R411 0.7% Denis R 2 710 -2% R 2 653 R385 Denis Revenue pre
Slide 22: Segmented financial reporting: Pharma
Segmented financial reporting structure Pharma: Performance supported by diverse customer base in the private and public sectors Revenue Operating costs Annotations Scriptpharm Scriptpharm 4,240 3,934 3,136 Pharmacy Direct increased DOH volumes for State 32% 2,883 36% patients – 1 million average pe
Slide 23: Cash conversion cycle: 130 days
Cash conversion cycle Balance of inventory levels and supporting growth PD and Curasana MMED Activo Benchmark 45 101 140 Benchmark 200 40 101 180 120 35 160 Benchmark 30 22 100 140 25 80 120 20 40 133 100 60 126 183 175 173 174 80 15 90 91 92 96 139 40 60 119 111 10 22 71 17 17 40 14 13 20 5 11 20 0
Slide 24: Forrester Acquisition
Forrester Acquisition This transaction will elevate Activo to a become major role player in the league of R1bn+ generic medicine turnover companies South Africa. THE DEAL The deal is structured as a loan to be converted into payment when sale of shares takes place in August 2021 BACKGROUND R150m loa
Slide 25: Forrester dossiers: 471% revenue growth
Forrester dossiers Activo Health acquired 100% of Forrester Pharma (Exeltis SA) on 1 August 471% REVENUE ONCOLOGY 2021 2022 GROWTH Products Revenue -1 - R820k Products Revenue -7 - R19.4 million OVER-THE- COUNTER Strategic investment are 2021 2022 projected to yield positive results Products -6 Prod
Slide 26: Statement of financial position
Statement of financial position Significant Movements Working Capital 2020 2021 Dec-19 Jun-20 Dec-20 Dec-20 (Excluding excess stock) 1 321 1 375 776 261 321 386 369 178 198 210 560 504 503 488 Land and Buildings Intangible Assets Cash Borrowings Property + 441 Equipment 421 393 357 331 326 298 LAND
Slide 27: Group performance - Investor dashboard
Group performance - Investor dashboard 5 year Compound Description 2016 2017 2018 2019 2020 2021 annual growth rate Total Revenue (R’m) 3 148 3 785 4 213 5 297 6 440 8 074 21% Operating Profit (R’m)* 376 564 613 677 883 1 032 22% Group Operating Profit Margin (%) 12% 15% 15% 13% 14% 13% Non-Controll
Slide 28: Annual Results Presentation
ANNUAL RESULTS PRESENTATION 21 for year ended June 2021 28
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