PRO MEDICUS LIMITED — AGM Information 2015

Nov 19, 2015

==> picture [264 x 375] intentionally omitted <==

==> picture [261 x 63] intentionally omitted <==

AGM November 2015

==> picture [776 x 27] intentionally omitted <==

==> picture [264 x 375] intentionally omitted <==

==> picture [261 x 63] intentionally omitted <==

Chairman’s Address AGM November 2015

==> picture [776 x 27] intentionally omitted <==

CHAIRMAN’S REPORT

Overview

The Board has continued to review its strategic challenges and objectives in light of the increasing global opportunities and the movement in market practices, to ensure that the company is well placed to maximize the potential benefits which may accrue.

Our review is guided by our underlying commitment to continue investment in our best of breed suite of innovative products - to maintain market leadership, which we believe is fundamental to your company’s success. We are confident that we have the global management team to deliver long term sustainable financial results given the appropriate strategies.

Our ongoing considerations include:

• (a) Scaling up our resources (particularly in North America)

• (b) Broadening our product range in the markets we currently serve

• (c) Diversification of our geographic reach

• (d) Our management structure and remuneration policies

• (e) Potential “bolt on” acquisitions

• (f) Composition of the Board

All of these matters have been considered and in some cases appropriate action has been taken, including scaling up resources and broadening our offering to existing markets. Dr Sam Hupert will expand on these during his presentation.

The Non-Executive Directors, in their capacity of the Remuneration Committee, have considered the remuneration of the Executive Directors and have made adjustments effective from 1 July 2015 to better reflect the value of the respective contributions of the Executive Directors to the company. The new level of remuneration will be first increase in Executive Director Remuneration since the company listed on the ASX in 2000.

The Board has for several years functioned successfully with two Executive Directors and two Non-Executive Directors, but now believes it would benefit by introducing an additional Non-Executive Director with complementary skills. We are in the process of appointing an Executive Search firm to assist us in identifying suitable potential candidates.

Financial Results

The financial results for the 2015 financial year recorded a healthy increase in net profit after tax (2015 $3.217 million: 2014 $1.51 million). This was a very pleasing result considering the level of investment for future growth and was a further indication of the company’s continuing momentum.

Results for the current financial year to date are also very encouraging and are above our budget expectations. Some of our previously announced contracts are progressively contributing to our revenues and we expect this trend to continue as

the year unfolds. As you are aware the US market is contributing an increasing proportion of our revenues and existing exchange rates are enhancing the company’s returns. It is difficult to predict future currency fluctuations, but it appears rates are likely to remain at current levels in the short to medium term.

As indicated in the Annual Report the company was able to secure a number of new long term contracts with various health care providers utilizing the Visage 7 product, particularly in North America. As the company’s cost base is relatively fixed, each of these new contracts have a significant impact on profitability.

Management is still pursuing a number of additional significant opportunities in North America, which if consummated will further add to the Company’s growing footprint in this, the world's largest market. Additionally, our recently announced German Government Hospital contract provides us with momentum in the key European markets.

The company’s Visage RIS product has continued to be installed at a number of client sites, including some of our largest and most diversified customers, both in Australia and offshore.

Company’s share price

The share price has shown further improvement since this time last year. (Nov 2014 in excess of 90 cents: Nov 2015 in excess of $3) We recognize that whilst share prices will fluctuate for a variety of reasons they are in general an indication of future expectations of a company. We are heartened that investors do appreciate the potential of the company and hope that our longstanding loyal shareholders feel vindicated in staying with us over the last few years.

Dividend Policy

The Board was pleased to continue the payment of dividends for the 2015 financial year at the level of 2 cents per share (unfranked) which was fully funded from the company’s internally generated cash flow.

As indicated at the last AGM the company was unable to attach franking credits to its dividend payments this year. However, during the year we changed our method of determining royalties payable by our US subsidiary, which will see an increased proportion of earnings flowing to Australia. This will result in increased tax paid in Australia, which will assist in rebuilding our franking account balance sooner than we had anticipated.

Closing

In closing, on your behalf, I would like to thank all of our dedicated staff in Australia, North America and Europe for their contribution to the company during what has been a another very positive year. I would also like to thank my fellow directors who have also worked tirelessly and diligently to ensure that the company reaches its ultimate goals.

==> picture [264 x 375] intentionally omitted <==

==> picture [261 x 63] intentionally omitted <==

CEO Presentation AGM November 2015

==> picture [776 x 27] intentionally omitted <==

Pro Medicus (ASX:PME)

Healthcare IT company specialising in Enterprise Medical Imaging and radiology information system software.

Leading edge products, growing presence globally.

==> picture [431 x 239] intentionally omitted <==

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

EU Headquarters / R&D
Berlin, Germany
US Headquarters
San Diego, CA
Group Headquarters
Melbourne
----- End of picture text -----

Over 40 Software Engineers

==> picture [204 x 46] intentionally omitted <==

==> picture [245 x 60] intentionally omitted <==

PME Ltd

==> picture [136 x 186] intentionally omitted <==

==> picture [122 x 180] intentionally omitted <==

==> picture [62 x 50] intentionally omitted <==

==> picture [32 x 71] intentionally omitted <==

Visage 7 * Pro Medicus.net Product Suite OEM

Visage RIS *

FY2015 Highlights - Financial Results

==> picture [488 x 147] intentionally omitted <==

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

FY2014 FY2015 % yoy
Revenue ($m) 14.27 17.49 23%
Profit before tax ($m) 2.45 5.11 108%
NPAT ($m) 1.51 3.22 113%
Cash ($m) 15.26 12.94 - 15%
EPS (cps) 1.50 3.20 113%
DPS (cps) 2.00 2.00 0%
----- End of picture text -----

Growth in North American business

Positive free cash flow in FY2016

==> picture [364 x 226] intentionally omitted <==

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

$20,000,000
Revenue by Geography
$18,000,000
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$-
FY2011 FY2012 FY2013 FY2014 FY2015
Australia North America Europe
----- End of picture text -----

==> picture [297 x 223] intentionally omitted <==

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

$20.00 Cash ($M)
$18.00
$16.00
$14.00 Amira - Tax
Operating Cash
$12.00
$10.00
$8.00
$6.00
$4.00
$2.00
$-
FY2011 FY2012 FY2013 FY2014 FY2015
----- End of picture text -----

==> picture [776 x 27] intentionally omitted <==

FY2015 Highlights

==> picture [264 x 375] intentionally omitted <==

• Increased revenue from US contracts

• 3 major new US contract wins in FY2015

• Contracted revenue over next five years increased to >$50 million

• A number of key implementations completed

• Visage 7.0 gaining increasing momentum in US market

• Pipeline of Opportunities continued to grow

• Improvement in Australian business

==> picture [776 x 27] intentionally omitted <==

July 2015 to Now

==> picture [264 x 375] intentionally omitted <==

• AHN - 4[th] Major US contract in 12 months

• Contracted revenue increased by $10M >$60M

• $3M contract with large German Hospital

• Key installations progressing well

• Visage 7.0 continues to gain momentum in US market

• Tracking well relative to budget

• Increase in Cash Reserves

==> picture [776 x 27] intentionally omitted <==

Visage RIS – Entirely New

• Commercially released and implemented • Speed of product development has increased • Technology is leading edge • Feedback from customers positive • New clients - in combination with Visage • Will reposition company as leader in field • 12 month sales cycle ramp up

==> picture [776 x 27] intentionally omitted <==

Visage RIS – New Technology Platform

==> picture [271 x 438] intentionally omitted <==

• Technology is leading edge

• Feedback from customers positive

• • New clients purchasing both Visage RIS & PACS

• • Transition of user base progressing well

• • Repositioning company as leader in field

• • Large scale rollouts implemented > 1,000 users

==> picture [776 x 27] intentionally omitted <==

Leading Edge Product Set – Visage Imaging Number 1 in Speed, Functionality, Scalability

==> picture [592 x 427] intentionally omitted <==

==> picture [776 x 27] intentionally omitted <==

Sales Time Line

==> picture [96 x 95] intentionally omitted <==

==> picture [85 x 84] intentionally omitted <==

==> picture [106 x 79] intentionally omitted <==

==> picture [317 x 9] intentionally omitted <==

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

November 2011 October 2013 November 2014
----- End of picture text -----

==> picture [109 x 82] intentionally omitted <==

==> picture [141 x 63] intentionally omitted <==

==> picture [210 x 11] intentionally omitted <==

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

April 2015 November 2015
----- End of picture text -----

==> picture [730 x 183] intentionally omitted <==

==> picture [427 x 104] intentionally omitted <==

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

May 2013 May 2014 January 2015
----- End of picture text -----

==> picture [70 x 9] intentionally omitted <==

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

September 2015
----- End of picture text -----

==> picture [101 x 94] intentionally omitted <==

==> picture [776 x 27] intentionally omitted <==

Massive data explosion

==> picture [357 x 359] intentionally omitted <==

• Higher image density - CT leaps from 64 slices to 256 and now 640

• 3.0T MRI – much larger dataset than 1.5T

• Functional Imaging e.g. PET scan often > 1.5 to 2 gigabytes

• Digital Breast Tomosynthesis (DBT) files can be over 4 to 6 gigabytes

• Prior examinations multiply the problem

==> picture [776 x 27] intentionally omitted <==

Solution - Visage 7.0 Streaming Technology

==> picture [738 x 369] intentionally omitted <==

==> picture [776 x 27] intentionally omitted <==

“Deconstructed” PACS – VNA/EMR

Radiology Urology Gastroenterology Oncology Cardiology Neurology

==> picture [459 x 322] intentionally omitted <==

==> picture [776 x 27] intentionally omitted <==

Solution – Visage 7.0 Viewer”

==> picture [225 x 92] intentionally omitted <==

VNA use surging – VNA's projected to store 31% of new imaging studies worldwide by 2016 InMedica, May 2012 Of late, imaging IT has been a "barren" field of technology innovation Reiner & McKinley, JDI, June 2012

No single vendor will do Enterprise Imaging 2012, KLAS Image sharing most important capability for institutions that have adopted VNA Katalus Advisors, June 2012 3D imaging into the workflow of the radiology department effectively Advanced Visualization 2011, KLAS

More providers forming Enterprise Imaging Strategies , w/goal of getting "the right image to the right place at the right time" KLAS, July 2012

==> picture [776 x 27] intentionally omitted <==

Strategy – North America

==> picture [225 x 92] intentionally omitted <==

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

17
----- End of picture text -----

==> picture [250 x 302] intentionally omitted <==

• World’s largest market

• PACS market estimated at > US$2 billion pa and growing

• Paradigm shift to “deconstructed PACS” – best in breed approach

• Market fragmented - in process of consolidating

• Visage ideally suited to capitalise on market trends

==> picture [776 x 27] intentionally omitted <==

Growing our US Team

==> picture [307 x 345] intentionally omitted <==

• Sales, implementation and support organisation

• Strong management – highly experienced

• Increasing investment in personnel to meet market demand

• Our success is attracting quality candidates

• Leveraging global team capabilities

==> picture [776 x 27] intentionally omitted <==

- Marketing North America

==> picture [215 x 58] intentionally omitted <==

==> picture [472 x 342] intentionally omitted <==

• New bigger trade stand

• More staff attending

• More demonstration areas

• More appointments

• = Biggest RSNA yet

==> picture [776 x 27] intentionally omitted <==

- Marketing North America

==> picture [173 x 46] intentionally omitted <==

==> picture [580 x 387] intentionally omitted <==

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

http://www. rsna.org/uploadedImages/RSNA/Comedcpu.com/wp-
ntent/Annual_Meeting/2015/Top_Banner.pncontent/uploads/2015/01/RSNA-873x457.jp g
----- End of picture text -----

==> picture [776 x 27] intentionally omitted <==

Global Management Structure

==> picture [147 x 392] intentionally omitted <==

==> picture [74 x 94] intentionally omitted <==

==> picture [63 x 88] intentionally omitted <==

==> picture [63 x 90] intentionally omitted <==

==> picture [64 x 81] intentionally omitted <==

Malte Westerhoff – Chief Technology Officer

Sean Lambright - Head of Sales

Brad Levin – Head of Marketing

Teresa Gschwind – Head of Services

==> picture [776 x 27] intentionally omitted <==

Growing Recurring Income Stream – Operational (Transaction) Model

• Alternative to capital model

• Favoured in recent US contracts

[insert chart comparing transaction with capital model]

• Model based on guaranteed minimums

• Contracted minimums increase to > A$60 million

• Upside as client examination volumes grow

• Annuity style revenue stream – greater predictability

==> picture [776 x 27] intentionally omitted <==

Margin Expansion

==> picture [245 x 328] intentionally omitted <==

• Highly scalable offering

• No capex (HW) – SW only model

• Training & Installation – charged as professional services

• Relatively fixed cost base

• Margin growth as footprint increases

==> picture [776 x 27] intentionally omitted <==

Growth Strategy

==> picture [266 x 376] intentionally omitted <==

• Transaction growth (above minimums) from existing clients

• Expand current footprint via new deals

• Margin expansion with future contracts

• Continue to build out pipeline

• Extend to other markets

• Introduce new products

==> picture [776 x 27] intentionally omitted <==

New products - Enterprise Imaging

==> picture [300 x 317] intentionally omitted <==

• Single viewer for all images in the medical record (EMR)

• Radiology/Cardiology (DICOM format)

• Non radiology - reflected light - hi res photos & video

• Visage ideally suited – any image streamed anywhere.

• Significantly increases Visage value proposition

• Additional future revenue stream

• Growth opportunity within existing contracts

Image courtesy of Gray Consulting

==> picture [776 x 27] intentionally omitted <==

New products - Enterprise Imaging

==> picture [652 x 422] intentionally omitted <==

==> picture [776 x 27] intentionally omitted <==

New products - Enterprise Imaging

==> picture [659 x 423] intentionally omitted <==

==> picture [776 x 27] intentionally omitted <==

==> picture [245 x 60] intentionally omitted <==

==> picture [458 x 311] intentionally omitted <==

==> picture [264 x 375] intentionally omitted <==

https://www.youtube.com/watch?v=eGQ9SSziykM

==> picture [776 x 27] intentionally omitted <==

==> picture [264 x 375] intentionally omitted <==

==> picture [261 x 63] intentionally omitted <==

Thank You AGM November 2015

==> picture [776 x 27] intentionally omitted <==