ikang Healthcare Group, Inc.

Transcription

1 ikang Healthcare Group, Inc. Q4 & FY2013 Financial Results Presentation June 2014

2 Forward-looking Statement This presentation contains forward-looking statements. These statements, including management quotes and business outlook, are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of These forward-looking statements can be identified by terminology such as will, "estimate," "project," "predict," "believe," "expect," "anticipate," "intend," "potential," "plan," "goal" and similar statements. ikang may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forwardlooking statements. These forward-looking statements include, but are not limited to, statements about: the Company s goals and strategies; its future business development, financial condition and results of operations; its ability to retain and grow its customer base and network of medical centers; the growth of, and trends in, the markets for its services in China; the demand for and market acceptance of its brand and services; competition in its industry in China; relevant government policies and regulations relating to the corporate structure, business and industry; fluctuations in general economic and business conditions in China. Further information regarding these and other risks is included in ikang s filing with the Securities and Exchange Commission. ikang undertakes no duty to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law. 1

3 Agenda SECTION 1: Operational & Business Updates Page 3 SECTION 2: Financial & Business Review Page 7 SECTION 3: Outlook & Growth Strategy Page 15 Q&A Page 18 2

4 SECTION 1 OPERATIONAL & BUSINESS UPDATES

5 Key Messages Historical fiscal year 2013, successful listing on the NASDAQ on April 9, 2014 Public offering as a true testament to our capabilities as the prime mover in industry Strong annual operating performance, growing by 70.3% A substantial quarterly net revenue increase of 60.9%, and powerful growth across all three of our service categories Aim to focus on network expansion through new centers opening and acquisition 4

6 New Center Development Progress Nation-wide network of 45 self-owned centers in 15 cities We have built 20 centers and acquired 25 centers as of March 31, 2014 ikang s Self-owned Centers Number Tier-1 Cities in China Tier-2 & 3 Cities in China FY2010 FY2011 FY2012 FY2013 FY2010 FY2011 FY2012 FY2013 FY2010 FY2011 FY2012 FY2013 No. of centers at beginning Beijing Nanjing Newly developed Shanghai Guangzhou Hangzhou Chengdu Newly acquired Shenzhen Fuzhou No. of centers at the end Hong Kong Tianjin Chongqing Suzhou Changchun Jiangyin Notes: 1. FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively 2. Tier-2 cities refer to all provincial capitals and municipalities, except for the tier-1 cities Changzhou

7 US $ Customers Total number of visits (in thousands) Blended ASP (US$) 000s 2,600 2,300 2,000 1,700 1,400 1, , , ,381 2, , ,725 1, FY2010 FY2011 FY2012 FY FY2010 FY2011 FY2012 FY2013 Corporate Individual ASP Corporate ASP Individual ASP No. of corporate customers No. of individual customers 17, ,000 11, ,000 5,200 7, , ,000 FY2010 FY2011 FY2012 FY2013 FY2010 FY2011 FY2012 FY2013 Note: FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively 6

8 SECTION 2 FINANCIAL & BUSINESS REVIEW

9 Financial Highlights Net Revenues (US$ 000) $202,304 $133,871 $93,713 $68,231 $18,360 $29,542 FY2010 FY2011 FY2012 FY2013 4Q FY2012 4Q FY2013 Note: FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively ; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively 8

10 Financial Highlights Gross Profit (US$ 000) 47.2% 46.9% 47.4% 41.7% $95,899 $62,792 $44,207 $28, % 19.9% $3,647 $5,872 FY2010 FY2011 FY2012 FY2013 4Q FY2012 4Q FY2013 Gross Profit % Gross Margin Note: FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively ; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively 9

11 Financial Highlights Operating Income (US$ 000) 8.8% 15.4% 14.6% 16.5% $33,364 $14,389 $19,589 $6,005 $(8,905) $(7,307) -24.7% FY2010 FY2011 FY2012 FY2013 4Q FY2012 4Q FY2013 Operating Income Operating Margin -48.5% Note: FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively ; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively 10

12 Financial Highlights Non-GAAP EBITDA (1) (US$ 000) 22.6% 22.1% 22.3% 17.4% $45,053 $29,572 $21,199 $11,849 $(4,451) $(2,877) -9.7% FY2010 FY2011 FY2012 FY2013 4Q FY2012 4Q FY2013 Non-GAAP EBITDA % Non-GAAP EBITDA Margin -24.2% Note: FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively ; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively (1) Adjusted for impairment of goodwill, impairment of leasehold improvement and share-based compensation 11

13 Financial Highlights Non-GAAP Net Income (1) (US$ 000) $22, % 10.6% $9,918 $14, % 11.1% $3, % $(4,851) $(4,726) -26.4% FY2010 FY2011 FY2012 FY2013 4Q Q 2013 Non-GAAP Net Income % Net Margin Note: FY2010, FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2011, 2012, 2013 and 2014, respectively ; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively (1) Adjusted for impairment of goodwill, impairment of leasehold improvement and share-based compensation 12

14 Financial Highlights Improving Cost Structure Cost of Revenue as a Percentage of Net Revenues (US$ 000) $106, % 80.1% % of Net Revenues FY2011 FY2012 FY2013 4Q FY Q FY % $71,079 Medical Consumables and Outsourced Services 20.1% 20.6% 19.7% 22.7% 22.7% 52.8% 53.1% 52.6% Salaries and Benefits 15.0% 15.6% 15.7% 23.7% 23.4% $39,795 $49,506 Rental and Office Expenses 12.1% 11.9% 12.8% 23.5% 24.1% $14,713 $23,670 Depreciation and Amortization 5.6% 5.0% 4.4% 10.2% 9.9% Total Cost of Revenues 52.8% 53.1% 52.6% 80.1% 80.1% FY2010 FY2011 FY2012 FY2013 4Q FY2012 4Q FY2013 as a % of Net Revenues Note: FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2012, 2013 and 2014, respectively; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively 13

15 Financial Highlights Improving Cost Structure Operating Expenses as a Percentage of Net Revenues (US$ 000) $62, % % of Net Revenues FY2011 FY2012 FY2013 4Q FY Q FY 2013 $43,203 Selling and Marketing 14.9% 13.8% 14.3% 28.9% 19.7% 44.6% General and Administrative 15.7% 17.5% 15.8% 37.9% 23.8% $29, % 32.3% 30.9% Research and Development 0.8% 0.9% 0.8% 1.6% 1.0% Impairment of goodwill $12,552 $13,179 Write-off of leasehold improvement 0.3% Total Operating Expenses 31.8% 32.3% 30.9% 68.4% 44.6% FY2011 FY2012 FY2013 4Q FY2012 4Q FY2013 as a % of Net Revenues Note: FY2011, FY2012 and FY2013 means the 12-month periods ended March 31, 2012, 2013 and 2014, respectively; 4Q FY2012 and 4Q FY2013 means the 3-month periods ended March 31, 2013 and 2014, respectively 14

16 SECTION 3 OUTLOOK & GROWTH STRATEGY

17 Outlook FY2014 Guidance Net Revenue: in between US$283 million and US$290 million, representing a YOY increase of 40.0% to 43.4% 16

18 Multiple Growth Drivers to Achieve our Goals Network expansion through new centers and acquisitions Win new contracts and expand customer base Build high-end ikang Evergreen brand An integrated platform with high quality services Increase utilization of medical centers Expand into complementary and adjacent services areas (e.g. Dental care) Continue to improve ikang's brand 17

19 Q&A