A Newly Accelerated Emerging Market Story June 2020 LI, May - PowerPoint PPT Presentation

A Newly Accelerated Emerging Market Story June 2020 LI, May Board Secretary 1

A New Phase With Accelerated Growth Billion CNY 16.6 Revenue 16 13.8 12 8 8 Listed 5.5 in Listed NYSE 4 Delisted in A 1.5 in Share NYSE 0 2019 2006 2011 2015 2018 2016 2

Tremendous Growth in China China Market is expected to maintain a double-digit growth in the future 28% 18% China Market as % of Global Market 3% CAGR 10%+ CAGR 20% CAGR 18% 1000 CNY Billion 530 0.56 57.6 1978 2006 2018 2022 Device to drug ration is substantially lower in China. 25.9% 41.2% 49.5% Medical Device Drugs Europe, China Global US, Japan 3

Inpatient Surgeries Sees Double Digit Growth Number of Inpatient Surgeries in China Number of Surgeries in Every 100K Population 2012 Number of Surgeries Growth Rate 15,280 in 10k 2018 15,280 7000 18% 12,188 12,087 16% 16% 6000 14% 10,000 13% 13% 5000 12% 12% 10% 4000 10% 10% 10% 10% 8% 3000 8% 4,432 6% 2,924 2000 4% 4% 1000 2% 0 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 China UK Germany US Japan Number of surgeries in China grows roughly 10% every year. Yet still a fraction of developed market numbers. Resource: 2019 China Healthcare Yearbook for China’s data, WHO for other countries’ data 4

Macro Environment Favors China ’ s Medical Device Market Tiered System of Diagnosis and Treatment Zero-markup on Drugs Long term focus of strengthening primary Recent policies of removing drug markup fuels healthcare delivery has allowed a tiered system medical device purchases. of diagnosis and treatment to grow. Budget Control on National Healthcare Insurance Two Invoice System and Centralized Procurement Healthcare institutions are under pressure of seeking Market leaders benefit from the integration of for value-for-money solutions to improve outcomes distributing channels and market consolidation. and efficiencies, where favors leading domestic medical device providers. Policies Post Coronavirus Outbreak Will Provide More Opportunities The deficiency of healthcare sector and lack of domestic high-end devices is confirmed during coronavirus outbreak, which will lead to incremental investment after the outbreak. 5

Only a Handful of Medical Device Companies Achieved $2 Billion Revenue Under 30 Years Est. 1998 From $0 to $2 billion 47yrs • Medtronic 55yrs • Sysmex 27yrs • Mindray Est. 1995 Est. 1991 6

CNY Billion A Unique Growth Story 16.6  From single product to multiple product lines 2013 M&A 2017 13.8  From China market to global market Rigid Zonare Endoscopes  From low-end to high-end segments 2013 CLIA* Overseas 11.2 Coagulation 2008 M&A 2012 Datascope Ventilator 9.0 2011 2009 Infusion 8.0 7.8 Defibrillator Pump 、 Surgical Lights 7.4 Operating Tables 6.7 Medical Supply Units 5.6 2007 4.7 Anesthesia 4.3 China 2003 1998 3.7 Biochemistry Hematology 2.2 1992 2001 1.5 Patient 1.1 Ultrasound Monitor 0.7 0.5 1992 1995 2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 7 *CLIA: Chemiluminescence Immunoassay

Market Positions of Key Products Patient Monitoring & Life Support Medical Imaging In-Vitro Diagnostics Patient Anesthesia Ventilator Defibrillator Hematology Biochemistry Ultrasound CLIA* Monitor China No.1 China No.1 China No.1 China No.2 China No.3 China No.5 China No.3 China No.1 ↑ 1 ↑ 1 Global No.3 Global No.3 Global No.3 Global No.7 Global No.5 ↑ 2 ↑ 1 Quadrupled Increased 11 Doubled in a decade Doubled in a decade in a decade times in a Up from #6 a year ago decade Source: Company Estimate and Public Information PS: Market share in China is based on the data of 2020Q1, while global market share is based on the data of 2019FY 8

Market Positions of Key Products Top Tier Globally Top Tier in China New Growth Drivers  Patient Monitor  Ventilator  CLIA  Hematology  Defibrillator  Coagulation  Ultrasound Infusion Pump Microbiology    Anesthesia  Surgical Lights, Operating Tables,  Urinalysis Medical Supply Units  Minimally-Invasive Surgery  Biochemistry Total Addressable Market Size in 2019 China China China 2.6 billion USD 2.9 billion USD 6.3 billion USD 17% 20% 18% Global Global Global 37.2 billion USD 14.8 billion USD 14.5 billion USD Source: Company Estimate and Public Information 9

Consistent R&D Investment Yields Great Returns Invested ~ 10% 10% of net revenues, 8 8 R&D centers in US and China more than 1.6billio illion CNY in 2018 Launches 7-12 12 new products each More than 2, 2,500 500 R&D personnel year 64% 64% of R&D engineers with Close to 5, 5,000 000 patent applications, master degree or above 13% 13% of of are filed in the U.S. 10

Strategically Located R&D, Sales & Marketing Infrastructure  8 R&D centers in North America and China, leveraging global innovation resources.  31 branch sales offices in China. R&D Centers  40 subsidiaries in overseas market. Products are Branches and subsidiaries sold to more than 190 countries and regions. Stockholm Novosibirsk Moscow Developed Markets London Vancouver Paris 15% Seattle Toronto Beijing Istanbul New Jersey Xi ’ an silicon Nanjing valley Chengdu Miami Cairo Shanghai New Delhi Shenzhen Mexico Bombay Lagos China Emerging 57% Markets 28% Johannesburg Sao Paulo Sydney Melbourne 11

Growth Drivers in Recent Years Focused investment on core business segments, launched new high end series with all key product High-end Products categories, with continuous technology breakthrough. High-end products opened new doors to the Breakthrough high end segment. Other Products Mid-to-low-end products upgrades integrated high-end features that create more value for customers that are more cost conscious. Upgrade New businesses such as CLIA, ventilator and infusion pump delivered tremendous growth thanks Strong Growth in to new product launches and synergies in R&D and sales platforms. New Businesses Higher Penetration Reinforced localization, capturing higher growth opportunities in China and Emerging Markets with In China + EM more comprehensive product offerings, channel management and clinical and after-sales service support. Revenue from high-end clients, including global top tier hospitals and IDN clients, significantly Remarkable Change increased. in Customer Base The revenue between public and private sector became more balanced, with better penetration into new customer base and well-positioned against macro economic fluctuations. 12

High-End Breakthrough & Fast Growing New Businesses High-end launches within the largest three products Benevision N22 Resona 7 CAL8000 World’s First Intelligent PM World’s first ultrasound with Word’s first integrated hematology Zone Intelligence automation line with CRP module CLIA, ventilator, infusion pump and other faster growing new businesses became significant growth contributors Chemiluminescense Immunoassay Infusion Pump Ventilator 13

Product Upgrades Resulted in Customer Upgrades Royal Papworth Hospital University Hospital De Toulouse Now in over 99% of Tier 1 hospitals in China over 100 teaching hospitals in Europe over 2/3 hospitals in US Ruijin Hospital, Shanghai Jiaotong 9 out of top 10 cardiac hospitals in US University School of Medicine 19 out of top 20 hospitals in US use Mindray’s ultrasound more and more IDNs in US … … Peking Union Medical College Hospital 14

Key Financials in Recent Years CNY billion Revenue Net income* Net Margin 28.3% 27.0% 16.6 23.2% 4.7 13.8 3.7 17.7% 11.2 9.0 2.6 8.0 11.4% 1.6 0.9 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Operating Cashflow R&D Spending ROE* 1.65 4.7 47% 1.42 42% 4.0 1.13 1.09 3.3 3.0 0.99 28% 28% 2.0 10% 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 * Note: Net income attributable to the company’s shareholders. *Note: 2018FY & 2019FY ROE ratio declined as IPO proceeds pumped up net assets. 15