Adapthealth Corp. · NASDAQ:AHCO
Adapthealth — Investor Presentation (January 2023)
29 slides from Adapthealth's investor presentation, January 2023
Slide 1: AdaptHealth Corp. Investor Presentation
JANUARY 2023 AdaptHealth Corp. I N V E S T O R P R E S E N TAT I O N DRAFT AS OF 09/02/22
Slide 2: Cautionary Statement
Cautionary Statement Forward-Looking Statements This presentation contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements, which express management's current views concerning future business, events, trends, contingencies, financial
Slide 3: Our strategic ambitions are guided by our vision
O U R S T R AT E G I C A M B I T I O N S A R E GUIDED BY OUR VISION Be the leading provider Improve of equipment + patient lives services that empower + healthcare at home Reduce overall through best-in-class cost of care care + superior technology
Slide 4: Market leading provider of sleep, diabetes + respiratory solutions
S T R O N G F O U N D AT I O N Market leading provider of sleep, diabetes + respiratory solutions—an integrated, patient-centric, tech-enabled model $3.0B 2022E revenue* ~90% recurring revenue ~6X revenue growth since 2019 COMPREHENSIVE U N M AT C H E D D I FFE R E N TI ATE D PORTFOLIO S C A L E + I
Slide 5: A national network with a local presence
A national network with a local presence Why scale matters ✚ Leverage created by ~750 locations in 47 states technology ✚ Closer to the customer ~36,000 deliveries every day ✚ Last mile and logistics touch points 5
Slide 6: Our comprehensive solutions address a range of chronic diseases
Our comprehensive solutions address a range of chronic diseases—top 3 position across the portfolio SLEEP DIABETES R E S P I R AT O R Y HME SUPPLIES PAT IENT Obstructive Sleep Diabetes COPD CHF Multiple Diseases DISEASES T REAT ED Apnea (OSA) Chronic Respiratory Various Failure OUR CPAP machines Con
Slide 7: Sleep at-a-glance
Sleep at-a-glance PRODUCT OFFERINGS M AR K E T S H AR E * $1.1B AdaptHealth NET REVENUE Rentals Q3 ‘22 Annualized 25% #1 ~280K 75% R E N TAL PAT I E N T C E N S U S PAP Resupply Rest of Market ~1.2MM S U P P LY PAT I E N T S *Estimated rankings based on 2021 VGM Group/LexisNexis claims clearinghouse
Slide 8: Respiratory at-a-glance
Respiratory at-a-glance $561MM FULL SUITE OF O F F E R I N G S ✚ Oxygen Therapy NET REVENUE Q3 ‘22 Annualized ✚ Ventilation ✚ Nebulizers & Nebulized Medications ~290K M AR K E T S H AR E * AdaptHealth PAT I E N T S O N O 2 & V E N T T H E R AP Y C E N S U S #2 Rest of Market *Estimated rankings base
Slide 9: Diabetes at-a-glance
Diabetes at-a-glance $693MM PRODUCT OFFERINGS REVENUE MIX Pharmacy Government S AL E S Q3 ‘22 Annualized Continuous 6% Glucose Monitors 24% 49% (CGM) ~250K PAT I E N T S O N C E N S U S 45% Other insulin pumps, glucose meters, 76% test strips, syringes, and 93 other supplies Insurance S AL E S R E P
Slide 10: Patient-first care: collaboration & communication
Patient-first care: collaboration & communication A 360-DEGREE APPROACH We are an ✚ Specialized teams working together and dedicated to ensuring consistency of care extension of ✚ Managing the whole patient → enhanced our referral high-quality experience sources into ✚ Building PCP referrals → early
Slide 11: Our data advantage
O U R D ATA A D VA N TA G E OTL ✚ Proprietary cloud-based Patient-centric, mobile delivery myAPP integrated suite ✚ Seamless Diabetes supplies reordering of digital tools Partner Order Tracking ✚ Faster resolution E-Prescribe eR/x to ordering issues ✚ Digital ✚ Reduced labor prescriptions needs ✚ Be
Slide 12: Industry tailwinds support our non-acquired growth ambitions
NON-ACQUIRED GROWTH Industry tailwinds support our non-acquired growth ambitions AGING P R O D U C T C AT E G O R Y GROWING P O P U L AT I O N G R O W T H E S T I M AT E S PREFERENCE U.S. population aged 65+ 86 % of adults prefer to receive (millions) 7 to 10 % % post-acute care at home vs. 73.1 Gro
Slide 13: Delivering scale + diversification via M+A
M + A VA L U E C R E AT I O N Delivering scale + diversification via M+A PRO DUCT S + Various HME CHANNELS 2019 Jan 2020 June 2020 June 2020 Jan 021 Q3 2021 T O D AY Sleep + + Respiratory + + ✚ More scale HME + + Supplies + ✚ Improved Diabetes + purchasing E-commerce + efficiencies Infusion + SCALE
Slide 14: Strategies to unlock growth + earnings potential
CLEAR PRIORITIES Strategies to unlock growth + earnings potential C A P I T A L I Z E O N T O D AY ’ S B U S I N E S S P O T E N T I A L + UNLOCK TOMORROW’S OPPORTUNITIES 1 2 3 4 Non-acquired Operational Strategic AdaptHealth 2.0 Growth Excellence M&A Transform connected Sleep, Respiratory, Drive ef
Slide 15: Positioning AdaptHealth to be a leader in the shift to connected care
E X E C U T E A D A P T H E A LT H 2 . 0 Positioning AdaptHealth to be a leader in the shift to connected care – building on strengths we have already invested in T O D AY FUTURE E A R LY I N N I N G S Leading the Pioneering the shift to connected market health solutions ✚ Top 3 across portfolio ✚ I
Slide 16: Delivering AdaptHealth 2.0
Delivering AdaptHealth 2.0 by executing on what we have already built S T R AT E G I C P R I O R I T I E S 1. Connected Care Still in early 2. Chronic Disease Management innings but excited about the opportunities 3. Payor Technology Connection ahead 16
Slide 17: Leveraging connected devices in the home
S T R AT E G I C P R I O R I T Y 1 CONNECTED CARE Leveraging connected devices in the home to drive targeted patient interventions O U R U N I Q U E A D VA N TA G E OUR OPPORTUNITY Database and domain ✚ Better care management expertise created by building on foundation in place to drive targeted eng
Slide 18: Adding clinical component to chronic disease management
S T R AT E G I C P R I O R I T Y 2 CHRONIC DISEASE MANAGEMENT Adding clinical component to chronic disease management OSA COPD DIABETES CHF Incidence 54MM with AHI ≥ 15.7MM 37MM 6.2MM Addressing Data (US) condition-specific offerings for Therapies CPAP machine + Oxygen, Ventilation, CGM, Beds, curre
Slide 19: Solve for payor pain points via technology connections
S T R AT E G I C P R I O R I T Y 3 P AY O R T E C H N O L O G Y C O N N E C T I O N Solve for payor pain points via technology connections Our established + expanding technology solutions help. P AY O R P A I N P O I N T S EXISTING OFFERINGS F U TU R E C O N N EC TED C AR E ✚ Claims administration ✚
Slide 20: Partner Order Tracking
S T R AT E G I C P R I O R I T Y 3 P AY O R T E C H N O L O G Y C O N N E C T I O N Partner Order Tracking ✚ Developed using strategic low-code platform ✚ Order lifecycle visibility to partners (e.g. health systems and commercial insurance companies) ✚ Auditable two-way interaction/messaging platfor
Slide 21: Evolve our financial profile
A C L E A R F I N A N C I A L S T R AT E G Y Evolve our financial profile Positioning Accelerate AdaptHealth to scale Value Optimize to $4B Revenue, Build Leverage $1B Adjusted Scale EBITDA*, $300MM FCF* 2020 2021 2022 & beyond & Beyond ✚ Acquire + integrate ✚ Lower capital intensity ✚ Sustainable t
Slide 22: Durable operating model drives cash flywheel and fuels growth
Durable operating model drives cash flywheel and fuels growth 1 Steady and sustainable 2 Disciplined M&A cash generation adding scale and density at attractive multiples REPOSITIONED BUSINESS scale, operating leverage, resupply Return Capital to census engine Technology investments 5 3 that turn our
Slide 23: Balance sheet provides flexibility to execute our strategy
Balance sheet provides flexibility to execute our strategy LIQUIDITY DEBT SERVICE DEBT STRUCTURE Net Debt / LTM Adjusted EBITDA* Debt maturities, as of Q3 FY22 3.5x Undrawn FY26 $770M revolver FY27 $0 capacity $433MM FY28 $350M After $17MM letters of credit FY29 $500M 3.2x FY30 $600M Cash & $111MM 7
Slide 24: Committed to advancing ESG efforts
F O U N D AT I O N A L I M P E R AT I V E Committed to advancing ESG efforts to drive value for team members, customers, shareholders + communities PROGRESS FOCUS AREAS ✚ Established Board oversight Ethics & Our People ✚ Implemented cross-functional ESG Accountability ✚ Employee Task Force and DEI C
Slide 25: Seasoned leadership team executing our strategic vision
Seasoned leadership team executing our strategic vision Steve Joshua Jason Chris Griggs Parnes Clemens Joyce Chief President Chief General Executive Financial Counsel Officer Officer Dan Rodney Joel Albert Bunting Carson Mills Prast COO President Chief Chief Field & COO People Technology Operations
Slide 26: Supported by an experienced board
Supported by an experienced board B R O A D & R E L E VA N T EXPERIENCE ✚ Business Leadership & Operations Richard Greg Brad Terence J. Steve ✚ Strategy Planning & Execution Barasch Belinfanti Coppens Connors Griggs Chairperson Board member Board member Board member Board member ✚ Healthcare since 2
Slide 27: Improving patient lives + lowering healthcare costs
IN SUMMARY Improving patient lives + lowering healthcare costs via a tech-enabled, patient-first integrated care model 1 2 3 A transformed Capitalizing on Execute on business value embedded in AdaptHealth 2.0 more scale, efficiencies + business today innovative pioneer in value creation potential pr
Slide 28: FY 2023 Guidance
FY 2023 Guidance Growth over 20221 2023 Guidance ($ mm)2,3 Product Category Low Mid High Low Mid High Sleep 11% 12% 13% Net Revenue $3,210 $3,250 $3,290 Diabetes 11% 12% 13% Supplies to the Home 4% 5% 6% Adjusted EBITDA $690 $720 $750 Respiratory 4% 5% 6% % of Net Revenue 21.5% 22.2% 22.8% HME 3% 4%
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation discusses AdaptHealth’s EBITDA and Adjusted EBITDA for prior periods and projected amounts for future periods. AdaptHealth defines EBITDA as net income (loss) attributable to AdaptHealth Corp., plus net income (loss) attributable to noncontrolling intere