F INANCIAL RE SUL T S PRE SE NT AT ION H1F Y2017 ue sda y - PowerPoint PPT Presentation

VIRT US HE AL T H (ASX: VRT ) F INANCIAL RE SUL T S PRE SE NT AT ION H1F Y2017 ue sda y 21 st F T e b rua ry, 2017 AE DT

DISCL AIME R T he ma te ria l in this pre se nta tio n ha s b e e n pre pa re d b y Virtus He a lth L imite d ABN 80 129 643 492 (“Virtus He a lth”) a nd is g e ne ra l b a c kg ro und info rma tio n a b o ut Virtus He a lth’ s a c tivitie s c urre nt a t the da te o f this pre se nta tio n. T he info rma tio n is g ive n in summa ry fo rm a nd inc lude s fina nc ia l a nd o the r info rma tio n a nd do e s no t purpo rt to b e c o mple te . Info rma tio n in this pre se nta tio n, inc luding fo re c a st fina nc ia l info rma tio n sho uld no t b e c o nside re d a s a dvic e o r a re c o mme nda tio n to inve sto rs o r po te ntia l inve sto rs a nd do e s no t ta ke into a c c o unt inve stme nt o b je c tive s, fina nc ia l situa tio n o r ne e ds o f a ny pa rtic ula r inve sto r. T he se sho uld b e c o nside re d, with o r witho ut pro fe ssio na l a dvic e whe n de c iding if a n inve stme nt is a ppro pria te . Pe rso ns ne e ding a dvic e sho uld c o nsult the ir sto c kb ro ke r, so lic ito r, a c c o unta nt o r o the r inde pe nde nt fina nc ia l a dviso r. T he re le a se , pub lic a tio n o r distrib utio n o f this pre se nta tio n in c e rta in jurisdic tio ns ma y b e re stric te d b y la w a nd the re fo re pe rso ns in suc h jurisdic tio ns into whic h this pre se nta tio n is re le a se d, pub lishe d o r distrib ute d sho uld info rm the mse lve s a b o ut a nd o b se rve suc h re stric tio ns. T his pre se nta tio n do e s no t c o nstitute , o r fo rm pa rt o f, a n o ffe r to se ll o r the so lic ita tio n o f a n o ffe r to sub sc rib e fo r o r b uy a ny se c uritie s, no r the so lic ita tio n o f a ny vo te o r a ppro va l in a ny jurisdic tio n, no r sha ll the re b e a ny sa le , issue o r tra nsfe r o f the se c uritie s re fe rre d to in this pre se nta tio n in a ny jurisdic tio n in c o ntra ve ntio n o f a pplic a b le la w. Ce rta in sta te me nts ma de in this pre se nta tio n a re fo rwa rd-lo o king sta te me nts. T he se fo rwa rd- lo o king sta te me nts a re no t histo ric a l fa c ts b ut ra the r a re b a se d o n Virtus He a lth L imite d’ s c urre nt e xpe c ta tio ns, e stima te s a nd pro je c tio ns a b o ut the industry in whic h Virtus He a lth o pe ra te s, a nd b e lie fs a nd a ssumptio ns. Wo rds suc h a s “a ntic ipa te s”, “e xpe c ts”, “inte nds,”, “pla ns”, “b e lie ve s”, “se e ks”, “e stima te s”, a nd simila r e xpre ssio ns a re inte nde d to ide ntify fo rwa rd-lo o king sta te me nts. T he se sta te me nts a re no t g ua ra nte e s o f future pe rfo rma nc e a nd a re sub je c t to kno wn a nd unkno wn risks, unc e rta intie s a nd o the r fa c to rs, so me o f whic h a re b e yo nd the c o ntro l o f Virtus He a lth, a re diffic ult to pre dic t a nd c o uld c a use a c tua l re sults to diffe r ma te ria lly fro m tho se e xpre sse d o r fo re c a ste d in the fo rwa rd-lo o king sta te me nts. Virtus He a lth c a utio ns inve sto rs a nd po te ntia l inve sto rs no t to pla c e undue re lia nc e o n the se fo rwa rd-lo o king sta te me nts, whic h re fle c t the vie w o f Virtus He a lth o nly a s o f the da te o f this pre se nta tio n. T he fo rwa rd-lo o king sta te me nts ma de in this pre se nta tio n re la te o nly to e ve nts a s o f the da te o n whic h the sta te me nts a re ma de . Virtus He a lth will no t unde rta ke a ny o b lig a tio n to re le a se pub lic ly a ny re visio ns o r upda te s to the se fo rwa rd-lo o king sta te me nts to re fle c t e ve nts, c irc umsta nc e s o r una ntic ipa te d e ve nts o c c urring a fte r the da te o f this pre se nta tio n e xc e pt a s re q uire d b y la w o r b y a ny a ppro pria te re g ula to ry a utho rity. A numb e r o f fig ure s, a mo unts, pe rc e nta g e s, e stima te s, c a lc ula tio ns o f va lue a nd fra c tio ns in this pre se nta tio n a re sub je c t to the e ffe c t o f ro unding . Ac c o rding ly, the a c tua l c a lc ula tio n o f the se fig ure s ma y diffe r fro m the fig ure s se t o ut in this pre se nta tio n. In a dditio n, a numb e r o f fig ure s ha ve b e e n c a lc ula te d o n the b a sis o f a ssume d e xc ha ng e ra te s, a s se t o ut in this pre se nta tio n. T o the ma ximum e xte nt pe rmitte d b y la w, ne ithe r Virtus He a lth no r its re la te d b o die s c o rpo ra te , dire c to rs, o ffic e rs, e mplo ye e s, a g e nts, c o ntra c to rs, a dvise rs no r a ny o the r pe rso n, a c c e pts, a nd e a c h e xpre ssly disc la ims, a ny lia b ility, inc luding witho ut limita tio n a ny lia b ility a rising fro m fa ult o r ne g lig e nc e , fo r a ny e rro rs o r missta te me nts in, o r o missio ns fro m, this pre se nta tio n o r a ny dire c t, indire c t o r c o nse q ue ntia l lo ss a rising fro m the use o f this pre se nta tio n o r its c o nte nts o r o the rwise a rising in c o nne c tio n with it. 2

RE SUL T S & OPE RAT IONAL OVE RVIE W H1F Y2017 3

H1F Y17 F INANCIAL RE SUL T S OVE RVIE W Challe nging H1F Y17 do me stic c o nditio ns have dr ive n a de c line in r e ve nue & e ar nings Re ve nue down by 0.7% to $131.4m Gro up c yc le s do wn 3.8% to 9,410 (H1F Y16: 9,782) • Austra lia n Virtus c yc le s do wn 7.2% pc p in a do me stic ma rke t do wn 6% H1F Y17 • DA down 12.3% to $31.7m Gr oup E BIT Austra lia n se g me nt E BI T DA do wn 13.1% to $33.9m • I nte rna tio na l se g me nt E BI T DA up 11.7% o n pc p • Ne t Pr ofit afte r tax (NPAT ) down 17.6% to $14.7m Cash/ De bt F unding c a pa c ity $57m ($47m unuse d b o rro wing fa c ility a nd $10m unc o mmitte d c a sh) • Ge ar ing at 2.3X adjuste d Gr oup E BIT DA Inte r im divide nd 13c ps fully fr anke d (H1F Y16: 14c ps) 4

AUST RAL IAN SE GME NT PE RF ORMANCE 5

Y AUST RAL IAN OPE RAT IONS - F E RT IL IT Vir tus is the mar ke t le ade r in Austr alia Ge ne ra l ma rke t a c tivity in e a ste rn se a b o a rd sta te s whe re Virtus • o pe ra te s do wn 6.0% c o mpa re d to pc p Virtus c yc le a c tivity in H1F Y17 do wn 7.2% to 8,070 c yc le s o n a like fo r • like b a sis De c line in Virtus full se rvic e a c tivity in Vic to ria • NSW T F C vo lume 19% b e lo w pc p; T F Cs re pre se nt ~12% o f o ve ra ll • Virtus NSW a c tivity T F C re pre se nts 12.4% o f Virtus a c tivity • Virtus NSW a nd QL D o utpe rfo rme d sta te ma rke ts • Austra lia n se g me nt E BI T DA do wn 13.1% to $33.9m (H1F Y16 $39.0m) • Re ve nue do wn 2% to $111.1m (H1F Y16 $112.8m) • Busine ss a nd c linic a l stra te g y to a ddre ss Vic to ria n sha re lo ss; T F C mo de l • unde r re vie w 6

VARIABIL IT Y IN AUST RAL IAN MARKE T GROWT H Annual gr o wth r ate var iability is no r mal and histo r ic ally ac tivity has impr o ve d fo llo wing pe r io ds o f mar ke t do wntur n Annua l Industr y Gr owth r a te s (F Y10-16) H1 Ma r ke t Volume s (F Y12-17) 24,000 10% 23,383 23,500 8% 23,000 6% 22,500 21,890 21,719 4% 22,000 21,432 21,500 2% 20,758 21,000 0% 20,345 20,500 2010 2011 2012 2013 2014 2015 2016 -2% 20,000 19,500 -4% 19,000 -6% 18,500 H1 F Y12 H1 F Y13 H1 F Y14 H1 F Y15 H1 F Y16 H1 F Y17 -8% Annua l Gro wth Ra te s Numb e r o f I VF Cyc le s 7 ye a r ma rke t CAGR to June 2016 is 3.1% • H1 F Y17 re fle c ts the ma rke t c o ntra c tio n o f 6.4% o ve r pc p to 21,890 c yc le s • Austra lia n IVF Cyc le s So urc e : Me d ic a re Austra lia 7

AUST RAL IAN MARKE T GROWT H Austr alian mar ke t vo lume s Austr a lia n Ma r ke t Cyc le s (2006-2016) 44,468 41,557 41,154 39,688 39,457 38,472 36,301 35,921 Ma rke t 12-T re nd 32,363 Ma rke t 29,034 26,167 23,976 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Gro wing Austra lia n ARS ma rke t sinc e 2005 • De mo g ra phic drive rs fo r ARS re ma in fa vo ra b le • Stro ng industry funda me nta ls with pe rio dic va ria b ility • So urc e : Me d ic a re Austra lia 8

AUST RAL IAN OPE RAT IONS DIAGNOST ICS & DAY HOSPIT AL Diagno stic r e ve nue inc r e ase d Day Ho spital r e ve nue de c r e ase d 7.1% H1F Y17 10.5% H1F Y17 Re ve nue up 37.9% in • Re ve nue de c re a se a • PGD/ PGS a c tivity - utilisa tio n c o nse q ue nc e o f we a k I VF a t 12.3% o f fre sh c yc le s (pc p a c tivity 7.9%) No n-I VF pro c e dure re ve nue • E ndo c rino lo g y a nd de c re a se d 14.4% a c ro ss a ll • c yto g e ne tic te sting de c line d da y ho spita ls a s a re sult o f we a k I VF c yc le a c tivity 9

INT E RNAT IONAL SE GME NT PE RF ORMANCE 10

IONS IRISH OPE RAT Mar ke t le ade r c o ntinue s to de live r c yc le and e ar nings gr o wth 1,170 c yc le s pe rfo rme d in H1F Y17 (H1F Y16: 1,148) stro ng re sult • c o nside ring six we e k c lo sure fo r Ro tunda I VF upg ra de s Re ve nue up 4.3% o n pc p (lo c a l c urre nc y) • E BI T DA up 3.5% o n pc p (lo c a l c urre nc y) • 7.6% c o ntrib utio n to g ro up se g me nt E BI T DA up fro m 7.0% H1F Y16 in-line • with stra te g ic o b je c tive s 11