ASC Industry - Northstar Healthcare Inc.

Report
Harry Fleming
Chief Financial Officer
Kenneth Efird
Chief Operations Officer
1
Forward Looking Statements
This presentation contains forward-looking information (within the meaning of applicable securities
laws) relating to the business of Northstar Healthcare Inc. (the "Company") and the environment in
which it operates. Forward-looking information may include statements regarding the objectives,
business strategies to achieve those objectives, expected financial results, economic or market
conditions, and the outlook of or involving the Company and its business. Such forward looking
information or statements are typically identified by words such as "believe", "anticipate", "expect",
"intend", "plan", "will", "may" and other similar expressions.
Forward-looking information, including any financial outlooks, is provided for the purpose of providing
information about management's expectations and plans about the future and may not be appropriate
for other purposes. Forward-looking information herein is based on various assumptions and
expectations that the Company believes are reasonable in the circumstances. No assurance can be
given that these assumptions and expectations will prove to be correct and the forward-looking
information, including the financial outlooks included in this Presentation, should not be unduly relied
upon. Those assumptions and expectations are based on information currently available to the
Company, including the historic performance of the Company's business. Such assumptions include
anticipated financial performance, current business and economic trends, and business prospects and
are subject to the risks and uncertainties which are discussed in the Company's regulatory filings
available on the Company's web site at www.Northstar-Healthcare.com or at www.sedar.com.
The Company’s management has approved the financial outlooks contained in this presentation.
2
Agenda
I.
ASC Industry
II. Northstar
III. Revenue/Growth
_Programs
IV. Financials
V. M&A
VI. Q&A
3
ASC Industry
4
Ambulatory Surgery Centers (ASCs)
 Outpatient surgery facilities
 No overnight stay required
 Lower cost structure to patient
and insurance companies
 Better patient outcomes and
satisfaction
 Higher physician satisfaction
 Reduced patient risk factors
Average charges – 33% lower
5
ASC Industry Overview
 Combined revenue of about $18 billion
 Untouched by Federal Healthcare Reform Act
 Fragmented market
 50 largest companies generate 30% of the revenue
 U.S. ASC industry includes about 3,500 companies that operate
about 5,000 centers
 75 independent ASCs in Houston; 350 in Texas
 High growth expected over next two years, driven largely by patients
seeking lower-cost alternatives to hospital care, better clinical
outcomes and patient satisfaction, and physician steerage of patient
care
6
U.S. Healthcare Trends
 Growth in outpatient surgeries due to Technology and Technique
 National number of ASC’s has quadrupled in 30 years
 Over 60% of all U.S. surgeries are as outpatients
7,000
Number of ASCs
6,000
5,000
4,000
3,000
2,000
1,000
0
More procedures suitable for ASCs
7
Northstar
8
Northstar - Overview
 Northstar partners strategically with physicians in the development
and management of ASCs with the mission of providing superior
medical care, increased patient satisfaction, lower costs for
healthcare delivery and revenue enhancement through innovative
marketing campaigns.
 NHC is a publicly listed company on the Toronto Stock Exchange
(Ticker: NHC), although all of its operations are located in the U.S.
 Outstanding Shares to date are 43 Million
 Management Team collectively owns approximately 20 Million shares
 Institutional Ownership Approximately 25%
9
Focus of Our Business
Bari,
 Most profitable part of the
healthcare delivery system
Spine, DPM
Gyn, Pain
Gen Surgery, Ortho
 Low costs if well managed
 Profit margins can exceed 50%
on a center level
Outpatient Surgery
Profits
Outpatient
Surgery
ASCs better serve surgeons,
patients and payors
Inpatient Surgery
X Rays
Labs
Medical Admissions
Hospital Profits
10
Our Locations
 Own and Operate 4 ASC’s:
• 2 in Houston
• 1 in Dallas
• 1 in Scottsdale
 Manage Clinical Operations:
• Spine/pain management
• Bariatric
• Podiatry
 Own and Operate 2 MRI and 1
Urgent Care Centers
Focus: Surgical excellence and maximizing
efficient use of facilities and resources
11
Our ASCs
 18 operating/procedure rooms
 150+ surgeons on staff
 Focus on high allowable and high
margin outpatient surgical
procedures
 10,000+ cases per year
 Close to major medical centers
KIRBY Surgical Center
Houston
12
Revenue/Growth
Programs
13
Revenue Growth Programs
Physician Contracting
 Accretive revenues for ASC
 Surgeon does not need to purchase equity
 Northstar’s ownership is not diluted
Direct to Consumer Marketing
 Current Campaigns:
• NueStepSM (Podiatric nerve decompression)
• CuraSpineSM (Spine)
• Bariatrics
 Upcoming Campaigns:
• Peripheral Bariatric Campaigns
14
Direct to Consumer Marketing
 Launched first campaign spring 2013
 Marketing infrastructure
• Campaign production
• Call center
• Media components
• Online presence
• Analytics for campaign optimization
 Clinical Management
 Lead Management
15
Marketing Campaigns
 Current Campaigns:
• NueStepSM (Podiatric nerve decompression)
• CuraSpineSM (Spine)
• Bariatrics
 Upcoming Campaigns:
• Peripheral Bariatric Campaigns
• General Surgery
16
Reimbursements
 High-Margin Cases:
• Minimally invasive spine surgery
• $50,000
• Bariatric surgery
• $40,000
• Podiatric nerve decompression
• $20,000
• Pain management procedures
• $5,000 - $10,000
17
Financials
18
Consolidated Revenue &
Operating EBITDA*
$80,000
$74,000
$70,000
$60,000
$50,000
$40,000
$31,127
$30,000
$20,897
$20,000
$12,329
$15,168
$14,380
$10,000
$5,999
$2,487
$9,917
$$(10,000)
$(3,534)
2010
$5,252
$2,368
$2,049
$2,147
2012
2013 E
$(1,090)
2011
Revenue
EBITDA
2014 E
Operating EBITDA
*Operating EBITDA is net of non-controlling interest but not including the corporate expense
**2013E EBITDA includes gain on bargain purchase from the Scottsdale acquisition
19
Marketing Metrics
DTC Conversion Rate *
Lead to Appointment
Appointment to Surgery
Lead to Surgery
Campaign Cost per
Lead
Appointment
Surgery
40%
31%
12%
$1,002
$2,484
$7,951
* Figures based on matured campaign cycle
20
M&A
21
Accelerated Growth Beyond Organic
Acquisition Targets
 Acquire ownership of local
surgical hospital(s) to
complement current
marketing programs
 A small-size ASC to
service current in-network
marketing leads
 ASC(s) beyond current
market area: San Antonio
 Ancillary healthcare
facilities to diversify
revenues and develop
referrals
22
Investment Highlights
Strong position in high growth ASC industry
Proven track record of performance
Compelling value proposition for surgeons, patients, and payors
Acquisition environment – accretive and accelerated market entry
Platform for scalable growth into multiple markets
Northstar Healthcare = Significant growth opportunity
23
Q&A
24

similar documents