HEALIUS LIMITED — AGM Information 2016

Nov 24, 2016

2016 Annual General Meeting

25 NOVEMBER 2016

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ROBERT FERGUSON CHAIRMAN

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FY 2016 HIGHLIGHTS

Group	Underlying	Underlying	Reported	Reported
$ million	FY16	FY15	FY16	FY15
Revenue	1,651.0	1,599.3	1,714.6	1,617.9
NPAT	104.0	111.5	74.7	127.5
Dividend cps	12.0	20.0	12.0	20.0

Reset strategic direction

• Successful capital recycling program

• Introduction of new GP recruitment packages

• Launch new private billing business

• Reduced debt and strengthened balance sheet

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BOARD, EXECUTIVE & REMUNERATION

Board

• Completed Board Performance Assessment and developed Skills Matrix

Executive team

• Enhanced team and strengthened functional support

Restructure of remuneration practices

• Appropriate mix of fixed and at risk remuneration

• Appropriate mix of short and long-term incentives

• Fixed remuneration benchmarked to improve alignment

• Specific and measurable performance metrics applied to incentives

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OUTLOOK

Well placed for growth

• Chronic conditions rising, hospital costs increasing

• Primary’s multi-disciplinary centres have a vital role to play

Aims and aspirations

• Cement position as a leading quality healthcare provider

• Become a preferred place for healthcare professionals and staff to work and for patients to come for treatment

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As at 30 June 2016

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PETER GREGG MANAGING DIRECTOR AND CEO

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2016 FINANCIAL HIGHLIGHTS

Group	Underlying	Underlying	Reported	Reported
$ million	FY16	FY15	FY16	FY15
Revenue	1,651.0	1,599.3	1,714.6	1,617.9
NPAT	104.0	111.5	74.7	127.5

• Underlying results in line in challenging market conditions

• Balance sheet review reset foundations

• Reported results reflect significant business changes including balance sheet review and transformation costs partially offset by profit on sales

	FY16	FY15
Net debt $’m	816	1,155
Gearing %	25.2%	32.4%

• Successful capital recycling program and reduced capex = stronger free cash flow and lower debt on balance sheet

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TRANSFORMATION JOURNEY

	Bridge Road Imaging opened	Bridge Road Imaging opened	Introduced capital-light HCP recruitment models	Introduced capital-light HCP recruitment models				Sold Medical Director	Sold Transport Health Sale & lease back of Imaging equipment	Sold Transport Health Sale & lease back of Imaging equipment
								Reset Dividend	Established Clinical
								Policy at 1H16	Councils
New capabilities HR, Govt Rels, Strategy			Established Property Trust Opened Varsity Lakes Imaging Centre				Launched Kossard Dermatopathology		Opened consolidated head office
2015					2016
Mar	Jul Nov Aug Oct			Dec		Jan		Mar Feb	Jun Apr
Settlement		Sold $152 million			Rolled out			Diversified into	Debt reduced to
	reached with ATO Barangaroo Sold stake in Vision Eye Melbourne IVF opened retail bonds redeemed Separation of Imaging and Pathology				Private Billing employee & HCP engagement initiatives Maxine Jaquet appointed GM Private Billing, Dr John Houston GM Bulk Billing				Awarded Northern Beaches Hospital $816 million, gearing to 25.2%
			Dean Lewsam						contract
			appointed GM Imaging

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MEDICAL CENTRES – BULK BILLING

Focus on recruitment and retention

• New flexible, capital light contracts for GPs

• Annual retention of GPs up 35%

Learning and development

• Primary Health Care Institute

• Largest private host of Registrars

My Medical Home

• Full suite of services 365 days a year

• Four large scale centres and 1 super centre

• Expanding the offering:

• Primary Dental, Primary Physio, Primary IVF

• Specialists, industrial medicine & occupation health, day surgeries, skin clinics, women’s clinics

• Integrated Care model for chronic care

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MEDICAL CENTRES - PRIVATE BILLING

Launch of Health & Co

• New brand

• Access to a different segment of the market

• Leverage Primary’s scale and expertise in practice management, business services and property

• Reduce back office administration, improve practice efficiency, enhance patient flow and better support clinicians

Partnership approach

• Active discussions with a number of clinics

• Expect several partnerships signed in FY17

• Greenfields developments

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PATHOLOGY

Leading laboratory and pathology operation

• Quality specialists with a range of services

• Kossard dermatopathology laboratory opened in FY16

• Strong profit contributor

• Investing in people and systems

• Discussions advancing in SE Asia where seeking to partner with local operators

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Divisional CEO

• Recruitment process nearing completion

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IMAGING

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Reset cost base for the future

• Improved second half performance

• Supported by labour and site rationalisation

Focused on portfolio realignment

• Hospitals – National Capital / Knox private / NBH

• Fit-for-purpose, high-end imaging centres – Bridge Road / Varsity Lakes / River City

• Selective private billing

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INNOVATION

Major IT investment

• Expanding and replacing key software systems

• Next generation cloud-based clinical and practice management software solutions

Integrated approach to patient information

• Support the portability of patient records

• Help patients proactively manage health outcomes

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GOVERNMENT REVIEWS

Policy clarity required

• MBS freeze for GPs

• MBS Review

• Bulk billing incentive cuts in Pathology and Imaging

• Regulation of ACC rents

• Imaging ‘Quality Framework’

Healthcare Home trials

• Seeking to participate via tender process

Private sector

• Adapt to funding environment

• Take the lead in the provision of quality, efficient and integrated care

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BUILDING A SUSTAINABLE FUTURE

Underlying drivers

• Strong underlying demand with:

• Growing population

• Ageing population

• Frontline, preventative care is the most effective form of healthcare

• Our large-scale multi-disciplinary medical centres are efficient providers of care

Our aspirations

• Sustainable growth for shareholders

• Good health outcomes for patients

• Employer of choice for healthcare professionals and staff

We expect to exceed our FY16 underlying NPAT performance of $104 million in this financial year

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DISCLAIMER

This presentation has been prepared by Primary Health Care Limited (ACN 064 530 516) (‘PRY’).

Material in this presentation provides general background information about PRY which is current as at the date this presentation is made. Information in this presentation remains subject to change without notice. Circumstances may change and the contents of this presentation may become outdated as a result.

The information in this presentation is a summary only and does not constitute financial advice. It is not intended to be relied upon as advice to investors or potential investors and has been prepared without taking account of any person’s investment objectives, financial situation or particular needs.

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