Babylon Holdings Limited · OTC:BBLNF
Babylon — Q2 2022 Earnings Presentation
20 slides from Babylon's earnings presentation, Aug 9, 2022
Slide 1: Q2 2022 Earnings
1 Q2 2022 Earnings August 2022 Putting an accessible and affordable quality health service in the hands of every person on Earth
Slide 2: Disclaimer: Use of Non-IFRS Financial Measures
Disclaimer Use of Non-IFRS Financial Measures This presentation includes certain financial measures to evaluate Babylon’s historical and projected financial and operating performance, and measures calculated based on these measures, including Adjusted EBITDA, Adjusted EBITDA Margin, Medical Loss Rat
Slide 3: Summary Progress for Q2 2022
Summary Progress for Q2 2022 3 362% Revenue growth year-over-year +60ppt Adjusted EBITDA Margin improvement year-over-year 6.2x Growth in VBC Revenue year-over-year Key Highlights Total revenue of $265m, representing a 362% increase from Q2 2021 revenue of $57m Reiterating revenue guidance for 2022
Slide 4: U.S. Value-Based Care Membership Growth
4 U.S. Value-Based Care Membership Growth U.S. Value-Based Care Membership(1) 59K 59K 56K 73K 140K 225K 222K 8K 8K 12K 12K 11K 31K 31K 16K 16K 15K 15K 15K 66K 66K 84K 100K 167K 271K 269K Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Medicaid Medicare Commercial • Maintained U.S. VBC member
Slide 5: Value-Based Care Revenue Mix
5 Value-Based Care Revenue Mix Value-Based Care Revenue Mix(1) 69% 68% 44% 58% 71% 60% 59% 31% 32% 33% 28% 19% 36% 37% 0% 0% 22% 13% 8% 3% 3% 1% 1% 2% 1% 1% $26m $27m $39m $56m $99m $247m $244m Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Medicaid Medicare Commercial Other • Medicare and
Slide 6: Strong progress in our Home State Health population
We are continuing to see strong progress in our Home State Health population 6 of appointments avoided an Emergency Room or Urgent Care visit(2) Notes: (1) Home State Health VBC Household Penetration, Oct 2020 to June 2022. Babylon defines household penetration as obtaining a sign-up from at least o
Slide 7: Our Performance Continues to Accelerate as We Learn from Each Contract
7 • Compared to New York and Missouri contracts, our weekly high- risk members’ sign up rates for Georgia have been ~4x faster and Mississippi rates have been 6-7x(3) faster • Continuous optimization and tailored outreach approach driving improvement in penetration rates over time • Onboarding high-
Slide 8: Revenue and Revenue Growth
8 Revenue and Revenue Growth (unaudited) $43m $28m $16m $41m $71m $57m $74m $120m $266m $265m Q3-2020 Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 +159% +5% +34% +30% +61% +123% Revenue Growth Notes:(1) $28.4m of one-off upfront revenue recognition in connection with a software licensing
Slide 9: Underlying Revenue and Adjusted EBITDA Margin
9 $43m $28m $16m $41m $71m $57m $74m $120m $266m $265m Q3-2020 Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Revenue (1) Notes:(1) $28.4m of one-off upfront revenue recognition in connection with a software licensing arrangement in Q1 2021. Adjusted EBITDA Margin for Q1 2021 has been calcu
Slide 10: Operational Leverage: Technology & SG&A costs as % of revenue
10 135% 92% 39% 38% 36% 21% 10% 12% 150% 44% 73% 79% 57% 65% 22% 26% 285% 137% 112% 116% 92% 86% 32% 38% Q3-2020 Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Technology costs SG&A costs 247ppt 124ppt SG&A margin and 123ppt technology margin improvement since Q3 2020 Notes:(1) $28.4m of on
Slide 11: Strategic Initiatives Targeting Adj. EBITDA Improvement of Up To $100m Per Year
11 We Have Strategic Initiatives Targeting Adj. EBITDA Improvement of Up To $100m Per Year • Centralisation of cost base supporting South-East Asia operations to UK & US • Contract negotiation and delivery of operational efficiencies in current services • Rationalisation of surplus office capacity,
Slide 12: Guidance Update
Guidance Update Revenue Guidance • Reiterating full year guidance of $1.0bn or greater Adjusted EBITDA Guidance • Reiterating improved guidance from $(295)m or less to $(270)m or less for the full year Reiterating Long Term Profitability Guidance • Adjusted EBITDA and cash flow breakeven no later th
Slide 13: Financial Statements and Reconciliations
13 21 Financial Statements and Reconciliations
Slide 14: Consolidated Statement of Profit and Other Comprehensive Loss
Consolidated Statement of Profit and Other Comprehensive Loss (unaudited) 14 14 (USD ‘000s) Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Software licensing revenue 8,281 7,983 7,824 7,756 7,375 Clinical services revenue 10,064 10,764 13,119 12,115 13,889 Value-based care revenue 39,133 55,715 98,745 246,
Slide 15: Consolidated Statement of Financial Position
Consolidated Statement of Financial Position (unaudited) 15 15 (USD ‘000s) Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 ASSETS Non-current assets Right-of-use assets 10,135 7,297 7,844 20,014 17,972 Property, plant and equipment 2,879 5,964 24,990 25,694 26,698 Investments in associates 12,600 11,583 ---
Slide 16: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows (unaudited) 16 16 (USD ‘000s) Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Cash flows from operating activities Loss for the period (64,875) (65,975) (232,815) (91,357) (157,079) Adjustments to reconcile Loss for the period to net cash provided by (used in) operating
Slide 17: Reconciliation of Adjusted EBITDA and Other Non-IFRS Measures
Reconciliation of Adjusted EBITDA and Other Non-IFRS Measures 17 17 Note: We are not able to reconcile projected 2022 Adjusted EBITDA or 2022 Adjusted EBITDA Margin to their respective most directly comparable IFRS measures as we are not able to forecast IFRS loss for the period on a forward-looking
Slide 18: Thank you!
18 30 Thank you!
Slide 19: Risk factors
• We have a history of incurring losses, may not be able to achieve or maintain profitability, anticipate increasing expenses in the future and may require additional capital to support business growth. Additional financing may not be available on favorable terms or at all. • Our historical operatin
Slide 20: Risk factors (continued)
•Failure to adequately expand our direct sales force will impede our growth. •We may invest in or acquire other business and we may have difficulty integrating any such acquisitions successfully. We may also enter into collaborations and strategic alliances with third parties that may not result in