HEALIUS LIMITED — AGM Information 2015

Nov 25, 2015

26 NOVEMBER 2015

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2015 RESULTS

		YEAR ENDED
	YEAR ENDED	30 JUNE 2014	MOVEMENT
$ MILLION	30 JUNE 2015	(RESTATED)	%
Revenue	1,618.5	1,524.1	6.2%
Reported NPAT	136.5	114.6	19.1%
Underlying NPAT	119.1	114.6	3.9%
Reported Earnings per share (cents)	26.7	22.7	17.6%
Underlying Earnings per share (cents)	23.3	22.7	2.6%
Dividends per share (cents)	20.0	20.0	–

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EXECUTIVE AND BOARD

EXECUTIVE

BOARD

Appointment of Peter Gregg Retirement of 3 executive directors as CEO and MD

Appointment of Malcolm Ashcroft as CFO

Appointment of 2 non-executive directors:

• Robert Hubbard

• Gordon Davis

Appointment of new executives

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REMUNERATION

FY 2015

• Board discretion in adopting underlying EPS

• No STI or LTI awards linked to EPS

FY 2016

• Executive packages

• Aligned with performance

• Appropriate mix of fixed / at-risk

• STIs

• Targets – 70% NPAT, 30% individual

• Awards – 75% in cash, 25% in rights deferred in equal tranches over 2 years

• LTIs

• Targets – 50% relative TSR, 50% ROIC

• Awards – 100% in performance rights, deferred for minimum 3 years

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2015 YEAR IN REVIEW

ACHIEVEMENTS

• Improved accounting treatment of Healthcare Practitioner (HCP) acquisition costs

• Tax refund received and settlement of tax liabilities of HCPs negotiated with ATO

• IVF commenced in NSW and 2[nd] site opened in Victoria

• Bridge Road Imaging in Victoria opened

• Strategic Review undertaken

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MEDICAL CENTRES

STRATEGIC REVIEW INITIATIVES

Grow market share with roll out of large-scale multi-disciplinary medical centres

Improve HCP recruitment and retention

ACHIEVEMENTS TO-DATE

• NSW site approved

• 3 large scale and 1 super centre in pipeline

• Flexible recruitment packages

• Q1 recruitment / retention ahead

• Training / clinical support

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PATHOLOGY

STRATEGIC REVIEW INITIATIVES

Expand non-routine specialties

Explore opportunities offshore

Robust business case for Approved Collection Centres (ACCs)

ACHIEVEMENTS TO-DATE

 Opportunities under review

• Opportunities under review

• ~~Tighten hurdles for new~~ ACCs/resigns

• Close non-performing ACCs

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IMAGING

STRATEGIC REVIEW INITIATIVES

Invest in radiologists and equipment

ACHIEVEMENTS TO-DATE

• Appointment of GM, Imaging

• Extended Bridge Road – exceeding expectations

• Opened Varsity Lakes

Optimise performance across network

• Site-by-site assessment

• Restructured JVs

• Major hospital pipeline in Eastern States and ACT

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MEDICAL DIRECTOR

STRATEGIC REVIEW INITIATIVES

ACHIEVEMENTS TO-DATE

Continue to leverage and  Invested in next grow market position generation products  Awarded Victorian health contract Evaluate strategic partners  to provide expertise strategic partner

• Commenced process to find strategic partner

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CAPITAL MANAGEMENT

STRATEGIC REVIEW INITIATIVES

Capital management

ACHIEVEMENTS TO-DATE

• Capital planning disciplines

• ROIC is key KPI

Capital recycling

• VEI sale – $38 million

• Barangaroo sale – $40 million

Property Trust

HCP acquisitions

ATO refund

• REIT development advanced

• Flexible, capital-light recruitment packages

• Refund received and ATO reviewing FY03-FY07 claim

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STAKEHOLDER ENGAGEMENT

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----- Start of picture text -----

Lifetime
patient-centric care
Flexible
Group-wide recruitment,
co-operation training and
support
Proactive Greater
dialogue transparency
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GOVERNMENT REVIEWS

WE SUPPORT

• Modernisation of the healthcare system

• Submissions to the reviews

• Participation in the MBS review panels

WE DO NOT SUPPORT

• Alarmist agenda around waste

• Denigration of GPs

• Freeze on the Medicare levy

THE FACTS

• Frontline care is the best and cheapest care available

• Large-scale multi-disciplinary centres are efficient and cost effective

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TRADING UPDATE

• Subdued revenue environment and margin compression to-date

• Underlying EBITDA and underlying NPAT 5% below FY 2015

• Statutory NPAT broadly in line with underlying NPAT

• Subject to trading conditions in the remainder of the year

• Progress on strategic review

• Drive growth as partner of choice for HCPs

• Focus on ROIC, free cash flow, and flexible cost base

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DISCLAIMER

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