Team. Marcelo Bermúdez CFO Cruz Blanca Salud. Joaquín Solís de Ovando IR Cruz Blanca Salud

Transcription

1 NOVEMBER 2011

2 Team Marcelo Bermúdez CFO Cruz Blanca Salud Joaquín Solís de Ovando IR Cruz Blanca Salud

3 History of growth, profitability and acquisitions Cruz Blanca Salud s strategy is based on diversification and growth Association between Said Group and Linzor Capital Partners Acquisition Incorporation Said Group enters the healthcare sector Acquisition Acquisition Acquisition Isapre Acquisition 2007 Acquisition Said Group expands its asset base in the healthcare sector Strategy of joint development in the healthcare sector 3

4 One of Chile s leading healthcare groups #1 provider of private outpatient service 13 outpatient care centers consultation rooms ~ visits Leading hospitals in their regions 3 hospitals 358 beds ~ hospital admissions #2 Chilean Isapre* by revenues beneficiaries policy holders 81 branch offices (*) Isapres are regulated private health insurance institutions 4

5 The Chilean healthcare sector has attractive growth opportunities

6 Chile s healthcare sector Policy holders and their dependents (together beneficiaries ) Insurance Market (1) US$ million Higher income population Q: 18% $: 35% Lower income population Q: 82% $: 65% Fonasa (public health insurance) Institutional mode Free election mode Public provider (outpatient or hospital) Private provider (doctors, outpatient or hospital) Decision of health insurance (public or private) are made by policy holders Policy holders contribute a mandatory 7% of Can be the same their salary and can contribute an additional voluntary amount Employers only collect and pay to the insurers Members decide according to their health plan where to get care Isapre (mandatory private health insurance) Closed or preferred provider plans Closed or preferred provider (outpatient or hospital) Insurers pay care providers up to the plan coverage and members pay the difference ( copayment ) Cruz Blanca Salud business areas (1) Source: Cruz Blanca Salud, from Superintendencia de Salud (National Health Authority) figures and Fonasa. Does not include Armed Forces, worker s compensation, medical leave expenditures and voluntary health insurance 6

7 Strong dynamics Per capita healthcare expenditures (US$ PPP) (1) Sample of OECD countries People over 60 spend more on healthcare (2) Healthcare expenditures by Isapres members (US$/year) USA Switzerland Germany France UK OECD average Spain Italy Japan S. Korea Chile Turkey Mexico They spend ~3,0 times more than people under 60 3,719 3,376 2,755 2,396 1,891 1, , >80 Chile s healthcare sector has doubled in the last 8 years(3) Outpatient medical service spending had the largest growth(3) Private healthcare providers capture a significant proportion of outpatient service spending from Fonasa members Chilean population over age 60 should double in the next 20 years(1) (1) Source: World Health Organization (2) Source: Superintendencia de Salud, per capita spending by age group (3) Source: Cruz Blanca Salud «Healthcare spending is expected to grow between 2,0x 2,6x between (4)» (4) Source: Cruz Blanca Salud, based on forecasts by Chilean healthcare consulting company Altura Management (5) Fx Rate: Ch$500/US$ 7

8 Cruz Blanca Salud, one of Chile s healthiest companies

9 Successful business model Commercial Synergies Insurance (Isapre) Hospitals Outpatient Centers To increase volume of sales among our 3 businesses 33% of health plans sold as of September 2011 were Preferred Provider Plans within our network Diagnostic services with no co-payment for members within our network Our hospitals capture 48% of the spending of our Isapre in the regions where they operate Spending by our Isapre at Integramédica has increased 43% since the acquisition of Integramédica Cost Synergies Providers operate as a network Outpatient Centers Hospitals Economies of scale in purchase of supplies and equipment Savings on administrative expenses and IT Attractive client value-proposition 9

10 Cruz Blanca Salud Successful Initial Public offering on June 23, 2011 Proceeds of US$ 164 million shareholders 38,2% free float Solid financial position: Net Financial Debt / EBITDA of 0,8x (LTM) Ownership structure (30/09/2011) EV / EBITDA P / E NFD / EBITDA Other shareholders 8,19% Mutual funds 1,42% Private pension funds (AFPs) 3,13% Insurance companies 0,47% Cruz Blanca Salud (1) 8,0x 14,7x 0,8x Chilean comparables 11,2x 17,8x 1,4x Stockbrokerage houses 12,10% Said Group 40,85% Banmédica 10,5x 16,0x 1,5x Clínica las Condes 12,7x 22,6x 0,5x Indisa 12,6x 17,9x 2,5x Securities funds 12,91% Brazilian comparables 12,5x 35,1x - Fleury 14,3x 21,9x - Linzor Capital 20,92% Dasa 11,6x 43,7x - Amil 11,6x 39,6x - Fx Rate: Ch$500/US$ Total shares: (1) Share price Ch$466 (11/07/2011) (2) Source: Bloomberg and Cruz Blanca Salud 10

11 Consolidated financials Revenue Breakdown (LTM*) US$ 814 million Hospitals 11% Outpatient 18% EBITDA Breakdown (LTM*) US$ 87 million Hospitals 22% Health Insurance 70% Health Insurance 40% Summary Balance Sheet US$ million Q 2011 Current assets 102,2 137,1 266,6 Non-current assets 335,9 567,2 595,2 Total Assets 438,1 704,3 861,8 Current liabilities 159,9 179,0 225,2 Non-current liabilities 132,9 340,6 279,1 Equity (Controlling shareholders) 115,2 157,4 329,8 Equity (Minority interest) 30,1 27,2 27,7 Total Liabilities + Shareholder's equity 438,1 704,3 861,8 Outpatient 39% Net financial debt 95,3 231,8 67,0 * LTM: last 12 months of operation (October 2010 September 2011) Fx Rate: Ch$500/US$ 11

12 Consolidated financials Revenues US$ thousand Net Profit US$ thousand LTM* YTD'10 YTD' LTM* YTD'10 YTD'11 EBITDA US$ thousand CAPEX Breakdown Sep Hospitals 30% Outpatient 63% LTM* YTD'10 YTD'11 * LTM: last 12 months of operation (October 2010 September 2011) Health Insurance 7% Fx Rate: Ch$500/US$ 12

13 Integramédica, #1 private outpatient provider Presence in 3 regions of the country where Revenue 56% of the population lives US$ thousand 13 outpatient care centers CAGR (07-LTM) Chile s largest private clinical laboratory 27 specimen collection points Approximately 3,100,000 annual lab tests 1,028 outpatient consultation rooms LTM* YTD'10 YTD'11 EBITDA US$ thousand >1,500 doctors CAGR (07-LTM) ~ 4.3 million visits in the last twelve months First outpatient institution with outpatient centers accredited by the National Health LTM* YTD'10 YTD'11 Authority * LTM: last 12 months of operation (October 2010 September 2011) Fx Rate: Ch$500/US$ 13

14 ,0 40,0 35,0 30,0 25,0 20,0 15,0 10,0 0 5,0 0,0 16,0 14,0 12,0 10,0 8,0 6,0 4,0 Integramédica, #1 private outpatient provider Revenues of 3Q 11 amounted to US$ 46 million (Δ + 25%) 3 new MRI s Increase in imaging exams Remodeling of outpatient care centers Δ + trade volume with Isapre Cruz Blanca beneficiaries Δ + trade volume with Fonasa beneficiaries Acquisition of Santiago s premier mammogram diagnostic center Lower comparison base as result of 2010 earthquake Liquidation of insurance claim Revenue US$ million 36,7 5,0 5,2 10,3 6,2 6,2 12,8 16,2 17,3 3Q'10 3,5 42,5 3Q'11 Excludes insurance claim income Other Ancillary services Diagnostic exam Medical consultations Monthly revenue per consultation room 12,5 13,8 EBITDA of 3Q 11 reached US$ 12,2 million (Δ + 76%) Q'10 3Q'11 Consultation room (Avg) Revenue* / Consultation room (Avg) - US$ th * Excluding US$ 3.5 million of insurance claims Fx Rate: Ch$500/US$ 14

15 Leading Hospitals in their geographic areas Presence in 3 regions of the country Revenues sq. ft. built 358 beds, of which 80 are critical-care 72 consultation rooms US$ thousand CAGR (07-LTM) recent consultation rooms (Marina Arauco Boulevard) More than 385,000 imaging and lab tests performed in LTM* YTD'10 YTD'11 EBITDA US$ thousand CAGR (07-LTM) LTM* YTD'10 YTD'11 * LTM: last 12 months of operation (October 2010 September 2011) Fx Rate: Ch$500/US$ 15

16 ,0 24,0 22,0 20,0 18,0 16,0 14,0 12,0 10,0 8,0 6,0 Leading Hospitals in their geographic areas Revenues in 3Q 11 reached US$ 25,6 million Monthly revenue per bed (Δ + 15%) 21,2 23,9 Δ + surgeries (+8%) Sales mix with higher average prices Δ + diagnostic exams (+17%) New outpatient clinic Marina Arauco 3Q'10 3Q'11 # Critical beds # Normal beds Revenue / Bed - US$ th 3Q 11 EBITDA amounted US$ 5,1 million (Δ + 6%) Revenue distribution 3Q 11 by hospital Δ + revenues Higher average prices are partially offset by the Clínica Reñaca Clínica Antofagasta fixed costs related to Clínica Reñaca s new 45% outpatient clinic which has not yet reached its 46% maturity level 10% Clínica San José Fx Rate: Ch$500/US$ 16

17 Isapre Cruz Blanca, #2 by revenues Since the creation of the private health system (1981) 81 branch offices (nationwide coverage) > policy holders and > members #2 in revenues in the Isapre market % market share by revenues 28,4 21,3 20,4 17,0 12,8 Strength of brand in spite of absence of Cruz Blanca name for 7 years Regulatory framework undergoing revision Changes likely to provide increased certainty on business regulation Revenues US$ thousand EBITDA US$ thousand Source: Asociación de Isapres, September 2011 figures CAGR (07-LTM) LTM* YTD'10 YTD'11 * LTM: last 12 months of operation (October 2010 September 2011) Fx Rate: Ch$500/US$ LTM* YTD'10 YTD'11

18 ,0% 87,0% 86,0% 85,0% 84,0% 83,0% 82,0% 81,0% 80,0% 200,0 180,0 160,0 140,0 120,0 100,0 80,0 60,0 40,0 20,0 0,0 Isapre Cruz Blanca, #2 by revenues Revenues in 3Q 11 reached US$ 154 million (Δ + 9%) Monthly revenue per policy holder Δ + number of policy holders (+5,9% / 3Q 11-3Q 10 period) Greater retention (resignations decreased 40% / 3Q 11-3Q 10 period) 127, ,5 150, , , New beneficiaries Increase in health plans prices (annual 3,9% increase in plans) Q'11 Annual Claims rate (January September 2011/2011) Policy holders (Avg) Revenues / Policy holders (Avg) - US$ Lower impact of epidemic events Claims rate Lower costs from temporary disabilities claims % 86,9% Cost control through referral to CBS s providers EBITDA 3Q 11 reached US$ 0.2 million Δ + claims 86,8% 83,5% 84,3% 83,5% 82,7% Industry Seasonal effect LTM* * LTM: last 12 months of operation (October 2010 September 2011) Fx Rate: Ch$500/US$ Source: Cruz Blanca Salud: Asociación de Isapres, in Chilean GAAP 18

19 Investment Plan

20 Investment Plan: strategic guidelines Grow in the provider business Main driver: outpatient business Increase profitability of current facilities and expand capacity Increase synergies among our businesses Expand offering of health plans to market segments enrolled in the public insurer system With organic growth we would double our EBITDA in 5 years Outpatient visits from to over 7,000,000 Lab tests from to over Inpatient days from to over Policy holders from to over

21 Investment Plan: next 3 years Projected Capex: US$ 100 million Hospitals Integramédica 10 new outpatient care centers in 3 years 1 center already under construction in Santiago 1 center recently open (November) Expansion of capacity and renewal of equipment at existing facilities Capacity expansion Clínica Reñaca Master Plan (60%) Capacity expansion Clínica Antofagasta (30%) Capacity expansion Clínica San José (10%) 54 new beds Improvement of facilities and medical equipment Isapre Investment in better technologies and optimization of branch offices network Inorganic Growth and Development of New Businesses Analysis of growth opportunities through M&A (recently P. Gazmuri and Biolab) Development of greenfield projects 21

22 Investment Plan: Integramédica Location criteria for new outpatient care center Population Income level Isapre Cruz Blanca beneficiaries Location Public transportation Road access / parking New outpatient care center New outpatient care centers: Maipú Puente Alto Others Other Competition Available doctors 22

23 Investment Plan: Integramédica 1 center under construction and 1 center recently opened Puente Alto (Recently opened / November) Maipú (2012) Second most populated area in Santiago sq. ft. 23 medical consultation rooms 9 dental clinics 4 gynecologist consultation rooms and 2 of ophthalmology 10 specimen collection points Endoscopy, ancilliary procedures and specialty labs First most populated area in Santiago sq. ft. 45 medical consultation rooms 11 dental clinics 6 kinesiology consultation rooms 8 specimen collection points Endoscopy, ancilliary procedures and specialty labs 23

24 Investment Plan: Integramédica Maipú outpatient care center 24

25 Investment Plan: Integramédica In Santiago Puente Alto Opened Santiago La Florida Ñuñoa Providencia S. Bernardo Maipú Under construction Outside Santiago Concepción Valparaíso Temuco New Centers

26 Investment Plan: Clínica Reñaca Master plan ~ US$ 21 million Remodeling and expansion of the Hospital Operationg room remodeling Increase of parking space Additional sq. ft. 28 new beds by the beginning of 2013 (with the capability of an additional 54 beds) Medical equipment ~ US$ 2 million

27 Investment Plan: recent developments Perú We recently initiated activities in Perú: Hiring of Peruvian manager André Borit (former Banmédica Perú) Incorporation of the subsidiary Cruz Blanca Salud Perú S.A.C. Analysis of prospects in the outpatient, inpatient and insurance businesses New Hospital in Santiago* Selection of property Total estimated investment of US$ 102 million in 3/4 years Initial capacity of 200 beds (up to 400 beds) * This investment is subject to the fulfillment of several conditions (e.g. purchase of property, administrative approvals of the project, etc.) 27

28 Disclaimer The information contained herein shall not be deemed an indication of the state of the company s business, financial condition, results of operations and/or prospects. The company assumes no responsibility for, or makes any representation or warranty, express or implied, with respect to, the accuracy, adequacy or completeness of the information contained herein. The Company expressly disclaims any liability based on such information, errors therein or omissions therefrom. The information contained herein has been prepared to assist interested parties in making their own evaluation of the company and does not purport to be all-inclusive or to contain all the information that a potential counterparty may desire. In all cases, interested parties should conduct their own independent investigation and analysis of the company. Interested parties can only rely on the result of their own investigation and the representations and warranties made in any definitive agreement that may be executed. Prospective investors who require additional information or have questions regarding the company should direct correspondence to or contact: Joaquín Solís de Ovando (ir@cruzblanca.cl) 28

29 NOVEMBER 2011