Bumrungrad Hospital Public Company Limited

Transcription

1 Bumrungrad Hospital Public Company Limited Analyst Meeting No. 2/2016 (1Q16 Results Update) Wednesday 18 May 2016 PG.1

2 Disclaimer The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase or subscribe for any securities of Bumrungrad Hospital Public Company Limited (the "Company") in any jurisdiction nor should it or any part of it form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This presentation is being communicated only to persons who have professional experience in matters relating to investments and/or to persons to whom it is lawful to communicate it under the laws of applicable jurisdictions. Other persons should not rely or act upon this presentation or any of its contents. Certain information and statements made in this presentation contain the Company's forward-looking statements. All forward-looking statements are the Company's current expectation of future events and are subject to a number of factors that could cause actual results to differ materially from those described in the forward-looking statements. Prospective investors should take care with respect to such statements and should not place undue reliance on any such forward-looking statements. This presentation has been prepared by the Company solely for the use at this presentation. The information in this presentation has not been independently verified. No representation, warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information and opinions in this presentation. None of the Company, any of its affiliates or any of their respective agents, advisors or representatives, shall have any liability (in negligence or otherwise) for any loss or damage howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. The information presented or contained in this presentation is current as of the date hereof and is subject to change without notice and its accuracy is not guaranteed. None of the Company, any of its affiliates or any of their respective agents, advisors or representatives, makes any undertaking to update any such information subsequent to the date hereof. This presentation should not be construed as legal, tax, investment or other advice. No part of this presentation shall be relied upon directly or indirectly for any investment decision-making or for any other purposes. Prospective investors should undertake their own assessment with regard to any investment and should obtain independent advice on any such investment s suitability, inherent risks and merits and any tax, legal and accounting implications which it may have for them. Certain data in this presentation were obtained from various external data sources, and none of the Company, any of its affiliates or any of their respective agents, advisors or representatives have verified such data with independent sources. Accordingly, the Company makes no representation as to the accuracy or completeness of those data, and such data involve risks and uncertainties and are subject to change based on various factors. PG.2

3 Corporate CEO Retirement Dennis Brown, Corporate CEO of Bumrungrad Hospital PCL. will be retired on July 31 st, PG.3

4 Ronald s. Lavater, MPA, Fache Ron is serving as the CEO for Al Noor Hospitals Group, Plc. since October Ron is a Fellow with the American College of Healthcare Executives (ACHE) and recently completed a two-year term as president of the Middle East & North Africa ACHE group. EDUCATION Master of Public Administration and Policy, concentration in Healthcare Administration and Policy Florida State University, 1992 City of Tallahassee, Intern, City Manager s Office, PROFESSIONAL EXPERIENCE Al Noor Hospitals Group, Plc. Abu Dhabi, UAE, 2014 Present * Chief Executive Officer and Executive Director of the Board Johns Hopkins Medicine International (JHI), Baltimore, Maryland, * Chief Executive Officer, Corniche Hospital, Hospital Corporation of America (HCA), Nashville, Tennessee, * Chief Executive Officer, Palms West Hospital, Florida, Blue Cross and Blue Shield of Florida, Jacksonville, Florida, PG.4

5 Overview Operational Update Inpatient volumes decreased 1.3% and 2.3% in terms of patient days and admissions, respectively, while outpatient volumes declined 1.0% year-over-year. The volume decreases occurred in both Thai and non-thai patients for outpatient volumes and in non-thai patients for admissions, offset by Thai admission growth. Financial Performance 1Q16 growth Total revenues 5.3% EBITDA 3.4% Net profit 0.3% Updates and Ongoing Focus Bangkok - Progress the expansion of Bumrungrad International Hospital Thailand - Continuing Bumrungrad network development International - Mongolia, developing and improving the capability of UBSD International - Diagnostic Clinic will be opened in June 2016 PG.5

6 Agenda Strategy Operational Update Financial Performance PG.6

7 Strategy Bumrungrad International Hospital Campus expansion Doctor recruitment in subspecialties Advanced technology Skilled work force Thailand Development of the Bumrungrad Network Leverage economies of scale in knowledge International Evolve UB Songdo into a regional hospital Operate a diagnostic clinic in Yangon Review of selective opportunities in existing referral markets PG.7

8 Strategy (Detail) Clinics Inpatient 2 nd Campus Acquire Additional Capacity International Actual/ Estimated Capital Investment (Million THB) Renovate BI Tower with clinical services on 6 floors Liver clinic was opened in 2015 Add an additional MRI and relocate one MRI Renovate and expand ancillary services Expand NICU Petchburi Road s EIA approval allows a Maximum FAR of 78,233 m 2 Construction permit was obtained in December 2015 Soi 1 property, maximum total building area of 26,000 m 2 is being planned for development Added BRO Building Acquired land on Soi 1/1 and Soi 3 Evolve UB Songdo into a regional hospital Operate a diagnostic clinic in Yangon Y15 Y16 Y17 Y18 Y19 Total 1,166 4,001 6,246 1,809 1,395 14,617 PG.8

9 Master Plan Update EIA Approval was obtained for the Petchburi Campus. Construction permit was obtained in December Soi 1 property, maximum total building area of 26,000 m 2, is being planned for development. Renovate BI Tower with clinical services on 6 floors and replacing the MEP infrastructure. Completed renovation of the BRO Building. Acquired additional land on Soi 1/1 and Soi 3. Develop BI Hospital Annex Building Project PG.9

10 New Land Acquisitions Surrounding Main Campus Total Land Area 1,852 m 2 Total Land Area 420 m 2 Total Land Area 138 m 2 SUKHUMVIT SOI 1 Total Land Area 597 m 2 PG.10

11 Bumrungrad International Hospital (Main Campus) 3 Main Buildings BI Clinic BI Hospital BI Tower PG.11

12 BI Tower Building Renovate BI Tower with clinical services on 6 floors, total space is about 8,100 m 2 Renovation started in November PG.12

13 Connecting Bridge between BI Hospital and BI Hospital Annex BI HOSPITAL ANNEX PG.13

14 BI Hospital Annex Project Concept Design Total land area is 1,852 m 2. Maximum total building area is expected to be 7,500 m 2. Completion of the project is expected in PG.14

15 Soi 1 Outpatient Facility Expressway ramp view The total site is 6,172 m 2. In order to maximize the allowed building area, the site will be divided in 3 zones. Maximum total building area is expected to be 26,000 m 2. Concept design is completed. PG.15

16 Current Status Petchburi Project EIA Approval allows a Maximum FAR of 78,233 m 2. Construction permit obtained. Defer construction until additional capacity is required. PG.16

17 Diagnostic Clinic in Yangon First Floor Plan Obtained Business Permit from Myanmar Investment Committee (MIC) on 25 Sep 15. Total rental land area is about 1,000 m 2. Usable space is about 450 m 2. Second Floor Plan PG.17

18 Diagnostic Clinic in Yangon Services are Primary care, Laboratory, X-Ray, Mammography and Ultrasound. Expected to operate in 2Q16. PG.18

19 Agenda Strategy Operational Update Financial Performance PG.19

20 Overall Volume Trend Average Visits per Day 17.9% 2.5% 5.1% 3.8% 2.1% Visits 4,000 3,325 3,348 3,424 3,397 2,820 3,264 3,249 3,269 3,325 3,255 3,000 Inpatient volumes decreased 1.3% and 2.3% in terms of patient days and admissions, respectively, while outpatient volumes declined 1.0% year-over-year. The volume decreases occurred in both Thai and non-thai patients for outpatient volumes and in non- Thai patients for admissions, offset by Thai admission growth. 2,000 1, Q 2Q 3Q 4Q 1Q Note: As 2016 is a leap year, 1Q16 has one extra day compared with 1Q15. Accordingly, the % volume variance on a per day basis indicated in the accompanying graphs are slightly different from those noted in the above narrative. This will also have a slight impact in other 1Q16 vs 1Q15 comparisons such as revenue and expense changes. Average Admissions per Day 18.1% 2.2% 6.3% 2.8% Average Daily Census 3.4% 21.6% 13.4% 2.1% 10.0% 2.4% Admissions Q 2Q 3Q 4Q 1Q ADC Q 2Q 3Q 4Q 1Q Note: 1Q14 do not include HHE. PG.20

21 Revenue Intensity Revenue per Visit Baht 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1, % 14.1% 10.8% 6.9% 9.0% 7,531 7,976 8,692 7,967 8,036 8,148 7,976 7,254 7,624 6,982 1Q 2Q 3Q 4Q 1Q Revenue intensity rose 0.4% per admission for inpatient services, attributable to a higher average length of stay for non-thai patients, and increased 3.9% for outpatient services. The combined results of the above resulted in inpatient service revenue growth of 3.1% with outpatient service revenues advancing 7.9%. The revenue contribution from inpatient services in 1Q16 was 48.4% and from outpatient services was 51.6%, compared with 49.5% and 50.5%, respectively, for 1Q15. Revenue per Admission 300, , , , ,000 50,000 Baht 1.0% 263, , , , % 13.6% 17.1% 5.5% 279, , , , , , Q 2Q 3Q 4Q 1Q Note: 1Q14 do not include HHE. PG.21

22 International Breakdown Revenue Contribution by Nationality 100% 80% 35% 34% 35% 35% 33% 60% 40% 65% 66% 65% 65% 67% 20% For 1Q16: In terms of revenues by market segment, non- Thai patients accounted for 67.0% of the total in 1Q16, with the remaining 33.0% from Thai patients, compared to 65.4% and 34.6% for non-thai and Thai patients, respectively, in 1Q15. The change from the prior year was mostly due to the growth in patient days associated with the increased average length of stay in non-thai business in 1Q16. Residency Nationality 0% 1Q15 2Q15 3Q15 4Q15 1Q16 International Thai Volume Contribution by Nationality 100% Thailand 43.8% Myanmar 8.4% UAE 8.3% Oman 5.9% Thailand 33.0% Myanmar 8.3% Oman 5.9% UAE 5.7% 80% 46% 46% 47% 47% 46% Cambodia 4.2% USA 5.6% 60% Qatar 3.5% Cambodia 4.1% 40% Bangladesh 3.4% Bangladesh 3.4% 20% 54% 54% 53% 53% 54% Kuwait 3.0% Qatar 3.1% 0% 1Q15 2Q15 3Q15 4Q15 1Q16 International Thai USA 1.9% Mongolia 1.7% Kuwait 3.0% UK 2.8% PG.22

23 Revenue Breakdown Inpatient vs. Outpatient (% of revenue) Method of Payment (% of revenue) 100% 80% 60% 51% 50% 51% 50% 52% Insurance 14% Corporate Contracts - Domestic 8% Corporate Contracts - Intl 8% 40% 20% 49% 50% 49% 50% 48% 0% 1Q15 2Q15 3Q15 4Q15 1Q16 Inpatient Outpatient YTD Mar16 Self-pay 70% 1Q16 Revenue growth: Outpatient revenue increased by 7.9% y-o-y Inpatient revenue increased by 3.1% y-o-y Self-pay remains the primary method of payment PG.23

24 Agenda Strategy Operational Update Financial Performance PG.24

25 Revenue from Hospital Operations Revenue from Hospital Operations (THB mm) Y2015 Y % 5,000 4,366 4,618 4,000 3,000 2,000 1, st Quarter 1Q16: The Company reported Revenues from hospital operations of Baht 4,618 million, a 5.8% improvement yearover-year from Baht 4,366 million in 1Q15. Inpatient volumes decreased 1.3% and 2.3% in terms of patient days and admissions, respectively, while outpatient volumes declined 1.0% year-over-year. The volume decreases occurred in both Thai and non-thai patients for outpatient volumes and in non-thai patients for admissions. Revenue intensity rose 0.4% per admission for inpatient services, attributable to a higher average length of stay for non-thai patients, and increased 3.9% for outpatient services. The combined results of the above resulted in inpatient service revenue growth of 3.1% with outpatient service revenues advancing 7.9%. The revenue contribution from inpatient services in 1Q16 was 48.4% and from outpatient services was 51.6%, compared with 49.5% and 50.5%, respectively, for 1Q15. In terms of revenues by market segment, non-thai patients accounted for 67.0% of the total in 1Q16, with the remaining 33.0% from Thai patients, compared to 65.4% and 34.6% for non- Thai and Thai patients, respectively, in 1Q15. The change from the prior year was mostly due to the growth in patient days associated with the increased average length of stay in non-thai business in 1Q16. PG.25

26 EBITDA and EBITDA Margin EBITDA (THB mm) 1,800 1, EBITDA Margin 36.0% 32.0% 28.0% 1,452 1,501 1st Quarter 32.9% 32.2% 3.4% Y2015 Y2016 Y2015 Y2016 1Q16: Cost of hospital operations (including Depreciation and amortization) was Baht 2,625 million for 1Q16, or 4.5% more year-over-year from Baht 2,513 million in 1Q15. This represents a favorable change when compared to the 5.8% growth in Revenues from hospital operations. The percentage of cost to Revenues from hospital operations improved from 57.5% in 1Q15 to 56.8% in 1Q16. Administrative expenses (including Depreciation and amortization) were Baht 815 million in 1Q16, or 16.5% more than Baht 699 million in 1Q15. The increase in Administrative expenses was mostly due to Baht 40 million more in staff costs, largely associated with additional staff to fill open positions from the previous year, annual merit increases, and additional staff to support the IBM Watson project; Baht 29 million more in Depreciation and amortization; Baht 19 million more in bad debt expense, mostly from additional provision for certain self-pay accounts; and Baht 12 million more in donation expense. EBITDA grew 3.4% year-over-year from Baht 1,452 million in 1Q15 to Baht 1,501 million in 1Q16, with an EBITDA margin of 32.2% in 1Q16 compared to 32.9% in 1Q % 20.0% 1st Quarter PG.26

27 Net Profit, Net Profit Margin and Diluted EPS Net Profit (THB mm) Net Profit Margin Y2015 Y2016 Y2015 Y2016 1,500 1, % 24.0% 22.0% 20.0% 21.9% 20.8% % 16.0% 0 1st Quarter 14.0% 1st Quarter Diluted EPS (THB) Y2015 Y % 1Q16: Net profit for 1Q16 grew 0.3% to Baht 978 million from Baht 975 million in 1Q15, with Net profit margin at 20.8% in 1Q16 compared to 21.9% in 1Q15. Basic EPS for 1Q16 of Baht 1.34 was 0.3% higher than 1Q15, while 1Q16 Diluted EPS increased at the same rate to Baht 1.13 from Baht 1.12 in 1Q st Quarter PG.27

28 Leverage Net Debt to EBITDA 1.50 x (0.50) (0.3) Net Debt to Equity 0.75 x (0.5) YTD Mar16 Interest x Coverage x * YTD Mar16 *After adding back the YTD Mar16, 2015, 2014 and 2013 capitalized interest expense related to the campus expansion. Cash and cash equivalent balances continued to exceed outstanding debt balances, resulting in net cash versus net debt position as at 31 March The Company s Interest coverage ratio improved to 25.0x in 1Q16 from 24.4x in 1Q15, due to higher EBITDA in 1Q16 compared to 1Q15. * * * (0.25) (0.1) (0.2) YTD Mar16 Note: Net debt excludes fixed deposits with a maturity exceeding three months but not more than one year which are reported as Short-term investments of Baht 429 million in YTD Mar16, Baht 2,306 million in 2015, Baht 1,922 million in 2014 and Baht 2,718 million in PG.28

29 Q & A PG.29