Grupo Fleury: history, market and strategic positioning, future. Mr. Carlos Marinelli Chief Executive Officer

Transcription

1 Grupo Fleury: history, market and strategic positioning, future Mr. Carlos Marinelli Chief Executive Officer

2 Grupo Fleury in numbers: purpose 90 years and reference healthcare company in Brazil 145 PSCs and lab operations of 22 Hospitals physicians and 8.3k employees providing services 73% Net Promoter Score (NPS) Our purpose To be present in the daily lives of people, assisting them and providing them with integrated health and medical solutions through knowledge and the continuous pursuit of excellence. Note: BRL/USD fx rate 3,08

3 Grupo Fleury in numbers: sound financials US$ 0,8 B annual gross revenue exams in portfolio in 37 different areas US$ 167 MM Operating cash-flow generation 55 Million+ clinical analysis exams processed per year US$ 157 MM Ebitda and 23% margin US$ 2,14 B Market cap Our purpose To be present in the daily lives of people, assisting them and providing them with integrated health and medical solutions through knowledge and the continuous pursuit of excellence. Note: BRL/USD fx rate 3,08

4 Identity: our fundamental pillars make us unique Competency map Competitive positioning Customer service excellence Extensive performance in the healthcare value chain Medicine and Health expertise Presence in major economic centers Innovation, research and development Best solution to customers and physicians. High quality, knowledge based relationship with customers and physicians Focused on the needs and resolution of referral physicians problems Unquestionable quality and broadest offering of innovative products/services We are the best choice for our clients in each business, segment and geography This allows us to create a close relationship with our clients and provide conclusive diagnostics to the physicians 6

5 Roots: our history makes us one of the greatest and most respected healthcare companies in Brazil Since 1926 providing excellence in diagnostic medicine in 37 different areas: Clinical Analyses (Routine, Pathology and high complexity exams), such as: o Hormonal dosage through mass spectrometry o Cellular antigens research o Molecular biology, etc Diagnostic Center (Imaging and others), such as: o Magnetic Resonance o Nuclear medicine o Endoscopy o Ultrasonography o Etc Service Center (83% of revenues) Operations in hospitals (14% of revenues) Reference laboratory (>1% of revenues) Business lines 145 Patient Service Centers (PSCs) with more than 100 thousand m². Exams and diagnostic services in 17 hospital institutions. Medium and high complexity exams to other laboratories and hospitals. 9 thousand employees and 1.8 thousand physicians providing services. Present in the country s main economic centers with diversified business lines. Preventive medicine (>1% of revenues) Dental diagnostics Health promotion for companies. 51% of Grupo Papaiz: leading position in São Paulo s market. 5

6 Brands: recognized brands, with focus on the premium and upper-intermediate segments high growth and margin Federal District Paraná Rio Grande do Sul Pernambuco Bahia Rio de Janeiro São Paulo Fleury: The best and most trusted brand in the Brazilian Market. Leader in premium segment. Clínica Felippe Mattoso: Premium brand in Rio de Jan. Strong in imaging. Weinmann: Top of Mind brand in Rio Grande do Sul. A+: National brand, launched in Strong potential for capturing intermediary segment. Diagnoson a+ and Labs a+: Cobranding strategy in Bahia and Rio de Janeiro to provide image and clinical analyses services on the same place ("one-stop-shop"). São Paulo Rio de Janeiro South Northeast Federal District Premium Intermediate Basic 6

7 Integration: we deliver conclusive diagnostics through a complete & reliable portfolio of exams and integrated services Information Complete portfolio of exams: Excellence in service Ex.: Integrated Reports Clinical Analyses Diagnostic Center High quality exams: - High end methodologies and technologies. - International quality certifications. - Highly specialized technical staff to perform exams. - Physician's trust over the diagnostics. Diagnostic informations Reliable Integrated Integrated information analysis: Medical knowledge management We provide several diagnostic solution products: Integrated Report, Evolutionary Medical Report, Artificial Intelligence (decision trees), etc.. Comprehensive and conclusive diagnostics (aid to physician-client s work) 7

8 Integration: our Advanced Diagnostic Centers offer a complete portfolio of integrated solutions in specific expertise 10 Advanced Diagnostic Centers + 4,000 pregnant women served per month State-of-the-art equipment Complete portfolio Qualified medical staff offering integrated solutions Gestar Fleury Pregnant women-oriented facilities Complete portfolio for the mom and baby diagnosis Medical staff specialized in fetal medicine +6,000 children served per month Children Center Child healthcare structure Inspired at Sesame Street Test results are readily available Pediatricians providing medical advisory services

9 In Summary: competitive advantages for all stakeholders Health Plan Providers Offer several coverage options 75% of Fleury revenues (2015 9M) Employers Choose health plan and services provider: for them Fleury is a must-have Our brands portfolio adds high quality in health plan coverage Patients Choose service provider based on physician s indication, personal preference and health plan coverage. Net Promoter Score (NPS) of 72.27% in 4Q16 vs % in 4Q15 Physicians Recommend health service provider Integrated Solutions Knowledge Generation Consultancy Innovation Qualified diagnostic and prevention improve employee wellness and plan costs Best and most trusted center for diagnostic medicine for 74% of physicians* * Source: IBOPE (2012) (1) The same research was conducted in 2008 and the result for Fleury was 70%. (2) A different methodology conducted by IPSOS in 2010, considering only some specialties. 9

10 Our 2017 priorities: accelerating growth, maintain innovative positioning and digitalize the company GROWTH Keep strong same store sales growth Expand diagnostic services to hospitals Resume accelerated PSCs expansion across geographies INNOVATION DIGITAL COMPANY Create new revenue streams Innovate through partnership Increase offerings, aggregate value to clients and differentiate through medical knowledge Digitalize client experiences Simplify key processes Guarantee excellence and focus on execution Increase ability to innovate through digital solutions

11 Growth: Resume accelerated expansion of PSCs and B2B contracts Fleury Increase capillarity and shield position in São Paulo Expand through low complexity PSCs (fast sites) Being closer to clients, investment on services offering that aggregate value to physicians and clients Expansion roadmap ( 17-21): Large PSCs: 2 Medium PSCs: 2-3 Small PSCs: Regional Brands Primary focus in São Paulo and Rio de Janeiro Regional growth with integrated systems Maintain profitability gaining's across geographies and strengthen brands positioning Expansion roadmap ( 17-21): a+ SP: +7 PSCs RJ Brands:+4 PSCs South brands: +2 PSCs B2B Increase active prospection to expand hospital operations Shield current accounts and increase same hospital growth Expansion focus: Business management to support changes required by customer strategy New operation in one of the largest hospitals in Latin America (BP) +

12 Innovation: Expanding innovation and digital solutions through partnership Medical knowledge and differentiation in customer experience Expansion of offer and quality in 2016 Strategic Partnerships to expand innovation Medical knowledge is a competitive differential that adds value to health History of commitment to knowledge. 651 new products launched since 2009 Team of ~1,8k physicians with high-level academic training Imaging: new diagnostic results center in RJ; new diagnostic results system Automation and clinical analysis, reduction in time to release exams and in technical cost Partnership to Genomics analysis: first company to sign a partnership with IBM Watson in Latin America Strategic partnership for codification and integration of medical knowledge In 2016: 51 articles published, 24 medical newsletter, 155 update meeting

13 Innovation: We see it as a key lever for growth and differentiation and foster it through strategic partnerships Innovation leveraging Grupo Fleury s core competencies Innovation through technical and medical knowledge applied to new products, services simplifying process to create new revenue streams and add value to clients Grow precision medicine and genomics Codification of medical knowledge Automation of integrated reports Big data and population health Strategic partnerships in health care value chain Establishing strategic partnerships with suppliers, hospitals, payors and other HC entities to enable new opportunities and accelerate innovation in several fields: Imaging Reference labs Clinical analysis Technology

14 Digital: Positioning as Digital Company integrated and focused on excellence Digital World 100% unified platform for all operations Empathy with the consumer: understand their moment and focus on values Execution Guarantee excellence and focus on execution Simplification of key processes and digitalization in monitoring and execution Efficiency Technology to increase profitability and reduce costs Technology to sustain growth, improving monitoring, control and strengthen management COSTS RISKS EXCELLENCE IN QUALITY

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16 Future: our long term view of the brazilian Health Care sector is positive but with some interesting challenges Private health care will accelerate growth while public sector spending will stagger There will be a huge quality improvement technically and managerially Market consolidation will gain momentum through incumbents and new entrants More data & knowledge integration will strengthen integration-ready players Evolution of the payment methods will transform the risk sharing across the value chain Profitability will migrate fast to precision medicine and other innovations HC Consumerism will be a huge opportunity for well positioned players

17 Thank you very much! Carlos Marinelli

18 Growth: acquisitions and organic growth created a US$ 0,8 MM company Revenue Breakdown (US$ MM) US$ 0,3 MM 15,9% 19,7% 59,9% Labs D Or Acquisition US$ 0,5 MM 24,6% US$ 0,4 MM 15,0% 17,2% 15,7% 14,8% 16,5% 52,8% 43,5% CAGR +16,2% US$ 0,6 MM 22,3% 16,7% 16,5% 44,5% US$ 0,6 MM 17,5% 15,7% 16,8% 50,0% US$ 0,7 MM 17,2% 16,1% 16,3% 50,4% US$ 0,8 MM 16,2% 16,3% 17,2% 50,4% Regional Brands RJ¹ B2B Regional Brands excl. RJ² Fleury Brand ¹ It includes the Regional Brands PSCs operations in the South Regions, São Paulo, Federal District and the Northeast Region. ² It includes the PSCs in Rio de Janeiro under the brands of Labs a+ and Felippe Mattoso. 18

19 B2B: focus on premium and upper intermediate markets Operations in hospital portfolio 17 hospitals in 5 Brazilian states Strategy atualizar Operations in hospital: to be a national benchmark for strategic partnerships through differentiation and highquality services. Lab to lab: to be a national market leader in the segment of high-complexity medical diagnosis. 01 Paraná 01 Distrito Federal 02 Rio Grande do Sul 10 São Paulo 03 Rio de Janeiro Lab-to-lab: geographical coverage with strong presence in the Southeast region of Brazil. Profitability: increase automation, process efficiency and mix improvement. Differentiation in service provision. Growth: same store sales and new contracts. Levers Growth in the high-end segment. Increased profitability due to operational efficiency gain. Differentiation in service provision. 9

20 Brazilian private health care value chain is quite similar to the USA s... Healthcare value chain Service Providers Clients Brokers Plan Operators Physicians Companies/ Employers Brokers Health Insurance Selfmanagement/ Administrators Health Cooperatives Group Medicine Hospitals Outpatient diagnostics: Clinical Analysis Patients Financial resources flow Outpatient diagnostics: Imaging Procedures Lab-to lab Diagnostics Medical services flow Supply Chain Equipment and inputs suppliers Services Providers (IT, consultancy, etc..) Inputs and services flow Workforce Standards for control and quality evaluation of services, suppliers of medical equipment, reagents and technology and tests and procedures available, among others elements, are similar in the Brazilian and American health care value chain

21 ...main difference between Brazil and USA is the integrated offer of clinical tests and diagnostic imaging procedures Clients Companies Patients Financial resources flow Grupo Fleury doesn t provide: Healthcare value chain Grupo Fleury Brokers provides: Plan Operators clinical analysis Health Insurance diagnostic imaging procedures Brokers Selfmanagement/ integrated solutions Administrators operation in hospitals, clinics and other labs Medical Appointments Surgeries Treatment Supply Chain Equipment and inputs suppliers Services Providers (IT, consultancy, etc..) Health Cooperatives Group Medicine Medical services flow Service Providers Physicians Hospitals Outpatient diagnostics: Clinical Analysis Outpatient diagnostics: Imaging Procedures Lab-to-lab Diagnostics Inputs and services flow Workforce In the United States, clinical tests and diagnostic imaging are predominantly processed in hospitals - approximately 70% of annual expenditure - with the remaining occurring in medical offices and independent diagnostic centers.

22 More recently, Grupo Fleury accelerated growth through Fleury brand + several acquisitions Increase of the mix of services, the geographical presence and the knowledge base 27 acquisitions since 2002, only Labs D'Or (2011) had a size exceeding R$ 100 MM of revenue Rio de Janeiro Bahia Pernambuco São Paulo Paraná Rio de Janeiro São Paulo Bahia São Paulo Rio de Janeiro Bahia São Paulo Rio Grande do Sul Rio de Janeiro Paraná 24

23 Strong presence in the most important market places of the sector SP and RJ Market share of Grupo Fleury - medical record (%)¹: São Paulo Metropolitan region Other Metropolitan regions Rio de Janeiro 9% 9% AAA 44.0% of AAA market 8.4% 27% A SP 4.8% of A market Rio Grande do Sul 12.6% 13% B Paraná 4.0% 50% C Bahia 8.9% Pernambuco 6.0% ¹Source: Grupo Fleury s estimates, based on ANS. Data of 2Q15, considering LTM. 25