PRO MEDICUS LIMITED — AGM Information 2020

Nov 24, 2020

Chairman's Address

AGM 2020

CHAIRMAN'S REPORT

Overview

The company has enjoyed another very successful year coinciding with the 20th anniversary as a publicly listed entity. Each of our businesses in our principal markets (Australia, Europe and North America) contributed strongly to the result.

The Company, and in particular the management team ably led by Dr. Sam Hupert, has navigated its way through a very challenging time.

The success of the company, despite the challenge of COVID-19, has been due to the quality of the management team, the resilience of all of our staff, the flexibility of our leading edge technology and the robustness of our business model. It is worth noting that Visage PACS enabled our clients to seamlessly switch to remote reading during the COVID-19 crisis; something that was not possible with their previous legacy systems.

The global management team has remained constant throughout the year and has continued to deliver long term sustainable financial results by implementing the steps outlined in the previously determined strategic plan.

The group continues to invest in our best of breed suite of innovative products - to maintain market leadership, which we believe, is fundamental to your company's success.

Many of the goals the company set itself in the strategic plan of August 2018 have been achieved. In October of this year the Board met with the global management team to discuss the next phase of our strategic direction. A follow up meeting will be held before the end of the calendar year to reset our strategic goals and objectives.

During the FY20 year the company announced several new contract wins in North America, including Ohio State University (November 2019); Nines (December 2019 and our largest deal for the year, NorthWestern Memorial HealthCare (June 2019). Since the end of the financial year we have announced a number of other material contract wins including NYU Langone Health (September 2020); and Ludwig Maximillians University of Munich (October 2020). We also recently renewed the Zwanger Pesiri contract for a further five years.

Each of these contracts is significant in its own right and all will make a major contribution to our future revenues.

In Australia the expansion of our relationships with I-Med Radiology Network and Healius (formerly Primary Healthcare) are progressively contributing additional revenues as the respective roll outs continue.

Despite the number of recently announced new contracts, the management team is working on a significant number of new opportunities and our pipeline continues to be strong. The group remains in an excellent position to continue to capitalise on these opportunities as they present.

Financial Results

FY2020 was another record year for the company with revenue increasing by 13.4% and net profit after tax increasing by 21% (2020 $23 million: 2019 $19 million). Importantly, underlying profit before tax increased by 33% to $30 million.

These results were achieved despite the impact of COVID-19 during the last quarter of the FY20 year (which we referred to in the Directors Report on page 2) and which we estimated to be approximately $1.2 million after tax or 5% of underlying net profit after tax.

The Company continued to be cash flow positive with retained cash increasing from $32 million to $43 million, after paying an increased dividend.

The Board anticipates another strong year with the majority of growth occurring in the second half of the financial year. The budget for the current financial year has been determined recognising continuing strong growth, with examination volumes returning to more normal levels. I am pleased to advise that results to date are ahead of budget, notwithstanding the impact of the falling US dollar.

Dividend Policy

The Board was pleased to increase dividend payments for the 2020 financial year to 12 cents per share fully franked. This represents an increase of 14% over the previous year and a payout ratio of approximately 50%. The dividends were funded from the company's internally generated cash flow.

The Board anticipates that future dividends will continue to be fully franked. The Board will continue to determine an appropriate level of dividends having regard to the profitability of the business, its need for ongoing investment and the necessity to retain sufficient funds to pursue other growth opportunities.

Additional Director

As I foreshadowed at last year's AGM, the Board undertook a search for an additional director. We had hoped to have finalised an appointment early in the New Year. We were well progressed with the process when our efforts were hampered by the restrictions imposed following the outbreak of COVID-19 in Australia. However the Board persevered and I am delighted that the company was able to secure the services of Deena Shiff. Deena joined the Board in August 2020 and I am

pleased to report that she is already making a strong contribution to our deliberations.

When we consider the formal business of the meeting, I will invite Deena to address you prior to consideration of the resolution for her election.

Corporate Social Responsibility

The Board and management recognises the importance of sound Environment, Social and Governance practices which provides the social licence for the company's operations. I would like to direct shareholders attention to page 15 of the Annual Report where we have set out some of the activities that the company is undertaking in the communities that we serve.

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 one of the most challenging, but most successful, years. 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.

CEO Address

AGM 2020

PRO MEDICUS (ASX:PME)

Healthcare IT company specializing in Enterprise Imaging and Radiology Information System (RIS) software.

Leading edge products, growing global presence.

OVER 40+ SOFTWARE ENGINEERS

FY 2020

FY2020 HIGHLIGHTS - FINANCIAL RESULTS

Revenue by Geographic Segment

Cash Balance

FY 2020

OPERATING LEVERAGE

• Highly scalable offering
• No capex (HW) SW only model
• Training & Installation charged as professional services
• Contained cost base
• High operating leverage
• Margin continues to grow as footprint increases

MARGIN EXPANSION

EBIT Margins

Year in Review

$9M/5 yearsNew Contract	$22M/5years	$25M/7 yearsNew Contract	$10M/7years	$8.5M/5years	Continues togrowSTRONGLY
DECEMBER2019	New ContractJUNE 2020	SEPTEMBER2020	New ContractOCTOBER 2020	Contract RenewalNOVEMBER2020	PIPELINE

Year to Date

• Tracking ahead of budget notwithstanding impact of lower USD
• Client volumes back to normal despite COVID
• Growth to continue in 2nd half
• Existing clients organic growth and new sites
• 3 large contract wins to come online in 2nd half -Northwestern, NYU and LMU Klinikum
• Possibility of additional sales implemented within period

COVID-19 - Operational

• PME/Visage transitioned to WFH in mid-March
• Able to operate at 100% capacity
• Sales and marketing efforts continued throughout
• "Thinness" of the technology enabled large scale remote demonstrations
• New opportunities despite COVID restrictions.

$COVID-19-Impatch$

• All elective imaging deferred late in March/early April
• Some regions affected more than others
• Worst affected volumes declined by up to 75%
• 2nd half April onwards steady recovery in image volumes
• Most clients now at normal volumes some >100%
• Deferred examinations still need to be done in catch-up period

VISAGE RIS

										VISAGE RIS
	Visage RIS - Dr R Simpson (rsna) visage2 (2) @ Visage General Hospital (ris.promed.com.au)
RECEPTION	TECHNOLOGIST DOCTOR TRANSCRIPTIONIST SEARCH			CLAIMINGOFFICE	SETUP						Recent $\blacktriangledown$ Dr R Simpson $\blacktriangledown$ $\bigcirc$ $\bigcirc$
Appointments	RequestedArrival	Billing	Banking
Region	Book				$\overline{ \nabla }$1 Tue, 17-Oct-2017 ▶	$\mathcal{Z}$	AM PM . Patient O Procedure Cancelled V Blocked			Reset	$1 \quad 2$
Northern			Visage General Hospital
Visage X-ray $\vert \triangledown$		Visage $CT \rightarrow$		Visage US Room 1 $\blacktriangledown$		Visage US Room 2 $\rightarrow$		$l$ isage US Room 3 $\vert \mathbf{v} \vert$		Visage Mammo $\vert \blacktriangledown$
	70		70		70		70		$\overline{\mathbb{Z}}\overline{\mathbb{Q}}$		$\overline{\mathcal{A}}$ Q
◀ Tue, 17-Oct-2017	$\rightarrow$ 200 $\rightarrow$ 1	◀ Tue, 17-Oct-2017	D 1 1 1 1 1 1 1 1 2 3 4 1	◀ Tue, 17-Oct-2017	$\rightarrow$ 200 $\rightarrow$ 1	◀ Tue, 17-Oct-2017	$\rightarrow$ $\blacksquare$ $\blacksquare$ $\blacksquare$ $\blacksquare$ $\blacksquare$ $\blacksquare$	◀ Tue, 17-Oct-2017	$\rightarrow$ $\blacksquare$ $\blacksquare$ $\blacksquare$ $\blacksquare$ $\blacksquare$ $\blacksquare$	◀ Tue, 17-Oct-2017	▸
08:30 AM		08:30 AM		08:00 AM	TEST, Mr Roger: U$\bullet$Test 43.607	08:30 AM		08:30 AM		09:00 AM
08:45 AM09:00 AM	Blocked	09:00 AM09:30 AM		08:15 AM08:30 AM		09:00 AM09:30 AM		08:50 AM09:10 AM		09:15 AM09:30 AM
09:15 AM		10:00 AM		08:45 AM		10:00 AM		09:30 AM	Urgent	09:45 AM
09:30 AM		10:30 AM	$\mathbf{Q}$ +SMITH, Mr John: C	09:00 AM		10:30 AM		09:50 AM	Urgent	10:00 AM
09:45 AM	Blocked	11:00 AM		09:15 AM		11:00 AM		10:10 AM	Urgent	10:15 AM
10:00 AM		11:30 AM		09:30 AM		11:30 AM		10:30 AM	Urgent	10:30 AM
10:15 AM		12:00 PM	Lunch	09:45 AM		12:00 PM		10:50 AM	Urgent	10:45 AM
10:30 AM		12:30 PM	Lunch	10:00 AM		12:30 PM		11:10 AM	Urgent	11:00 AM
10:45 AM	Blocked	01:00 PM		10:15 AM		01:00 PM		11:30 AM		11:15 AM
11:00 AM		01:30 PM		10:30 AM	Edit Appointment				$\leftrightarrow$	$\Box$$\times$$\overline{\phantom{0}}$
11:15 AM		02:00 PM	Non Contrast	10:45 AM
11:30 AM		02:30 PM		11:00 AM	Θ	APPOINTMENT	Mr John SMITH	FOLIO 10.645		ACCESSION 10.1270	Lunch
11:45 AM	Blocked	03:00 PM		11:15 AM	Tue, 17-Oct-2017						Lunch
12:00 PM		03:30 PM		11:30 AM					Male 05-Oct-1977 (40y) • H: (03) 1212-1211 Visage General Hospital Visage		Lunch
12:15 PM		04:00 PM		11:45 AM	10:30 AM - 11:00 AM				450 Swan Stree J. Dr Doogie Ho (03) 9800-1231 Appointment(s) $\triangleq$ Medium	$\overline{\mathbf{v}}$	Lunch
12:30 PM		04:30 PM		12:00 PM
12:45 PM01:00 PM	ADAMS, Mrs ROSE$\mathbf{P}$			12:15 PM12:30 PM	▼ SUMMARY
01:15 PM				12:45 PM
01:30 PM				01:00 PM		Patient SMITH, Mr John 10.645			Referrer Dr Doogie Howser 0000000Y
01:45 PM				01:15 PM		Born: 05-Oct-1977 (40y)
02:00 PM				01:30 PM		Male		Practice
02:15 PM				01:45 PM		(03) 1212-1211			Address 23 Holywood lane ThePlace RICHMOND
									VIC 3121 Australia
02:30 PM				02:00 PM			Address 450 Swan Street RICHMOND VIC 3121
02:45 PM				02:15 PM				Referral date 09-Oct-2017
03:00 PM				02:30 PM		View all details		Referral period 12
03:15 PM				02:45 PM
03:30 PM				03:00 PM		Accession 10.1270
03:45 PM				03:15 PM
04:00 PM				03:30 PM		Order Status Arrived (1/1)
04:15 PM				03:45 PM	$\blacksquare$					ы
04:30 PM				04:00 PM					Save	Cancel
04:45 PM				04:15 PM04:30 PM
				04:45 PM

• Long term (5 year) contracts with Primary Healthcare and I-MED, the 2 biggest radiology providers in AUS
• Combined additional revenue of $4.4M pa once fully deployed
• HIS (Healius) rollout nearing completion
• Upside via organic and M&A growth (i-med)
• Increased market interest new opportunities
• PME undisputed market leader

VISAGE RIS

Visage 7.0

Continues to be #1 in Speed, Functionality and Scalability.

MASSIVE DATA EXPLOSION

• High density Multi-slice CT 10,000+ images
• HD Breast Tomosynthesis 6 GB+
• Optoacoustic breast ultrasound 10+ GB
• Total Body PET Scan 10+ GB
• 7T MRI much larger than 3T

LEGACY TECHNOLOGY

"Compress and Send"

SOLUTION:

VISAGE 7 Streaming Technology

NINES

V Nines

• 5 year $6 Million platform deal
• Transaction based model volumes to step up YoY
• SaaS offering based on Visage in the Cloud
• Nines team highly respected in machine learning, AI, and radiology circles
• Leveraging the power of modern AI to clinical settings
• Opens up new market segment for PME

NORTHWESTERN

• Minimum $22 Million over 5 years
• Transaction-based licensing model with upside
• Voted in the top 10 Hospitals in North America
• Teaching hospital for the Feinberg School of Medicine $\bullet$
• Adds to PME growing base of Tier-1 Healthcare institutions
• Implementation scheduled for Q3 FY21

21

NYU LANGONE

• $25 Million over 7 Years
• Voted in the top 10 Hospitals in North America
• Transaction based licensing model with upside
• Teaching hospital for the Grossman School of Medicine
• Implementation scheduled for Q3/Q4 FY21
• 2nd Tier 1 academic contract win in 3 months
• 7 out of the top 20 hospitals in the US have standardized on Visage

LMU KLINKUM - Munich

• $$10M 7$ -year Deal
• One or Europe's largest teaching hospitals
• 2nd major hospital contract in Germany $\bullet$
• Visage 7 Viewer and Visage Open archive $\bullet$
• Breaks the mold of "one-stop-shop" modality vendor systems
• Paves the way for further European sales

LUDWIG-MAXIMILIANS-UNIVERSITAT MÜNCHEN

ZWANGER PESIRI

ZWANGER-PESIRI RADIOLOGY

• $8.5M -5-year renewal contract $\bullet$
• One of the largest private outpatient groups in the US
• Increased minimum contract value by 70%
• Visage technology key enabler of practice growth
• Validates Visage's unique value proposition

FAST TRACK IMPLEMENTATION

• Implementations on or ahead of schedule
• Fast track methodology continues to deliver
• Large scale projects completed in under 1/4 the time of industry norm
• Delivers huge savings for client
• Frees PME staff for other jobs
• Reduces barrier to change
• OSU first 100% remote implementation
• A key differentiator of Visage offering

VISAGE - PROVEN ROI

26

VISAGE - Clinical ROI

Bharti Khurana, MD @KhuranaBharti

#radres please use bone window and multiplanar reformations to distinguish a stent from ureteral calculus #easytomiss #EMRad #bodyrad #Urology #emergencymedicine @ASER_ERad

$\circ$

12 Retweets 74 Likes $\circ$ $\mathbb{C}\mathbb{J}$ 凸 $\circ$ Eric Pepin PhD MD @ericwpepin · Aug 13 Replying to @KhuranaBharti and @ASER_ERad On some PACS (eg @Visage_Imaging), making a curved reformat of ureteral stents takes just a few seconds. $\circ$ t1 2 $\circ$ 3 ① Daniel Ortiz, MD @danortizmd · Aug 12 Replying to @KhuranaBharti and @ASER_ERad Great tip! I always confirm no stones on coronals on all my cts because can be easy to blow by 1-2 mm stones on axials.

$\mathbb{C}$

$\circ$ 4

凸

Visage Imaging @Visage_Imaging · Aug 13 Thank you @ericwpepin! @KhuranaBharti and @BrighamRad @MassGenBrigham use #Visage7 and can quickly & easily create CPRs. Ex. Curved Planar Reformat (CPR) generated on-the-fly for better visualization of Rt. Urethra Obstruction @ASER ERad

Type a message

NORTH AMERICAN PIPELINE

NEW PRODUCTS

• One Viewer for ALL images
• Radiology/Cardiology (DICOM format)
• Non-radiology-reflected light- $\bullet$ hi-res photos & videos
• VISAGE 7 technology ideally suited
• Increases Visage value proposition
• Growth opportunities within existing contracts

ENTERPRISE IMAGING

• •
• •
• •
• •
• •

OPEN ARCHIVE

Visage 7 Workflow Manager

• Adds to V7 Viewer and Open Archive modules
• Based on over 30 years experience in Worklist SW
• Allows PME to offer single-vendor solution $\bullet$
• Integral part of Visage in the Cloud SaaS solution
• Ability to interface with broad range of AI algorithms

VISAGE in the CLOUD

• Visage 7 highly optimised for Cloud deployment
• Same ultrafast performance as on-premise
• Full Visage 7 functionality
• Security and scale of the cloud
• Full PACS deployment or as backup/disaster recovery
• Suitable for all size implementations
• Opens new market opportunities

Al in Radiology

• Imbedded in SW or imaging equipment
• Prioritisation of cases eg head trauma
• Screening eg early-stage lung nodule detection
• Aid to diagnosis $-2^{nd}$ opinion, incidental findings
• Automated diagnosis

Visage Al Accelerator

• Unique end to end solution
• Research and production environments on a single platform
• Based on market leading Visage 7 technology
• Enables Visage clients to fast-track AI as part of their imaging strategy

A

Visage 7

Research Server - streamlines AI algorithm development

ACCELERATOR

• Optimised for AI data curation and validation
• Open API enables native integration
• Al Ecosystem 3rd party and Visage developed algorithms
• Joint development/commercialisation opportunities - 3rd parties and academic clients.

A

Breast Density - Al

1st diagnostic AI algorithm produced by Visage

ACCELERATOR

• Developed in collaboration with renown breast imaging team at Yale
• Provides "on the fly" AI assessment of breast density
• Pending FDA approval
• A model for future collaboration with other academic institutions

A

NYU LANGONE - Joint R&D

• Multi Year research collaboration agreement
• NYU to be part of the Visage AI Accelerator program
• Joint R&D to develop next generation imaging products
• Visage to have onsite access to NYU Langone radiologists and imaging scientists.
• Visage to setup new R&D hub in NYC starting July 2021
• Leverage R&D and commercialization opportunities

Al Research Leadership

Malte Westerhoff Chief Technology Officer

Detlev StallingHead of Development

Ming De Lin Clinical Research Manager North America

ACCELERATOR

$\widehat{A}$

SUMMARY

• North American footprint continues to grow
• Transaction revenue up 31% YoY
• Market leading technologies
• Growing product portfolio single vendor or modular
• Proven implementation & support capability
• Unparalleled value proposition (Clinical and Financial ROI)
• Pipeline Continues to grow strongly.
• Visage AI-Accelerator strategically positioned to leverage AI

THANK YOU