Medicover AB (publ)

Morning, everybody. Welcome to our Q1 presentation. I think we've had a good first quarter. It's been a consistent and solid sort of position. We've got good momentum going on in the business with strong organic growth of 10.3%. This is our fifth consecutive quarter of improved margins year on year, which we're delighted with. There's been a few negative headwinds that have hit us. I don't think we need to talk about that too much. I think as a team, we've sort of navigated that well. And it shows the strength of our model. So it's pleasing to see the position that we've come out with despite all of that. India has shown some strong momentum. We expected that. We talked about that a lot in previous quarters in terms of what we've done to be able to get a bigger level of growth and more momentum as we go towards IPO. So we're very positive with that particular result in the quarter. And we fully expect as we go through coming quarters. Very robust performance in diagnostic services. Very pleased for the team, done an excellent job and our fee for service development is increasing in all markets, which is exactly what we want to achieve. Leverage has come down to 2.9. We expected that. We talked again about that in previous quarters. So it's good to see that going in the right direction. As we move on to the right hand side, you can see revenue 624.2 million. Organic growth of 10.3. Adjusted EBITDA 104.6. A nice increase there of 15.4%. Adjusted EBITDA 16.8%. And again, 15.7 previously. So we're seeing strong momentum in terms of our operating model as we see the operational leverage drop through as we develop the business. Pretty good cash flow. I'll let Anand talk through the mix of that because that's got a little bit of change and as discussed before, leverage coming down. As we move on to look at the growth metrics you can see on the left hand side here very consistent sort of growth trajectory from us consistent quarter on quarter growth in line with the expectations that we have as a business. If we look at the mix the mix is pretty pretty consistent for us we see that in the smaller part of our our revenues we were affected by the the hungary impact as we exited there um but most of our businesses showing solid growth and in germany it's the last quarter of the reform impact that is uh that is washing through and if you go to the revenue by payer again pretty consistent we've got a bit of work still to do on the funded business We said that in history that had been driven by the higher price increases that we put through and we fully expect to be momentum coming through in coming quarters. But what's really pleasing is that in our fee-for-service element, which is a reflection of how the business has changed over the years. We have a much higher exposure to this particular area of the market and we're growing well and growing strongly, which puts us in a good place. If you look at it from a healthcare services perspective, again, pretty strong growth from an organic perspective, 11.8%. India, 14.3%, but in local currency, 34.4%, which... Again, shows the work that we've done in terms of recruiting doctors and working on our average revenue per occupied bed. Sport and wellness going very well, going very strong for us, which is driving some of our operational metrics. Members, as I say, at the moment, pretty subdued, but we expect that to change. And more importantly, overall, due to the fact we've got a higher fee for service mix, we're still making good momentum in terms of the relationships that we keep to be able to have a long-term repeating business in this area of our business. So revenue good, EBITDA margins strong. You can see good increases there driven by operational leverage and the rest of our indicators pretty stable from a healthcare services perspective. As we move to diagnostic services, very pleasing to see the level of growth, 9.9%, driving the revenues over 200 million, which is really, really good. The fee-for-service revenue increased across all markets again. That's been a trend that's been developing for some time. Again, well done and very impressive performance from Ukraine because they had a particularly difficult quarter in terms of some aspects of the war and the impact that had on the operating model, just with things that we take for granted. But they navigated that reasonably well and exceptionally well when you consider those circumstances. So a big thank you to them. The German team continued to sort of develop solid momentum, navigating the reform, building the platform for the future. So all of the reform now has washed through. So it'll be interesting to see our development as we go through for further quarters. A number of tests have increased quite nicely. Again, you know, weather has actually impacted some of those volumes from an organic perspective. But we don't expect that to, you know, it certainly won't... impact us in coming quarters. And again, I think we as a team navigated that particularly well. So on the right hand side, you know, if you look towards the revenue by country, you can see all markets have done well. All markets are seeing growth. Some of them seeing extreme growth. If you move down to the EBITDA margin, we're progressing it. We're going from good to very good. And we intend to keep pushing on with our developments as we move forward. Lab tests up quite nicely and a very stable mix for us. So I'll hand over to Anad, who will talk you through more of the details related to the lower down in the P&L.

Thank you, John. Morning, everyone. As John said, despite some headwinds we had, we delivered a strong set of results in Q1. now delivers double-digit organic growth and margin accretion. So John said five quarters of margin accretion, and we expect that to continue in the future, which is good for us. In terms of revenues, revenues of 624 million, 8% up in total, but over 10% at organic level. said we'd be laser focused on ebit growth as well as ebitda growth and you can see a good expansion in our ebit numbers so 46.7 million in the quarter at a margin rate of seven and a half percent which is up 130 basis points And if you look at the kind of cash EBITDA, or EBITDA as we call it, strong performance there as well. So 67.4 million, up 20% at a margin rate of 10.8, which is up 110 basis points year on year. So even in challenging circumstances, our model continues to work. We also delivered a good performance in the EPS numbers as well. in terms of uh before we move on to the next slide i think uh just one thing to note so the margin accretion year on year is particularly strong in q1 uh that won't be the same uh for the rest of the year although there will be margin rate accretion in q1 what we have is we're anniversarying the acquisitions we made in q2 last year which are not in the base in q1 so previously we said they would be sales accretive and margin rate accretive So that kind of laps onto a base without it in Q1. But as we bought it in Q2 last year, it will kind of mitigate that fact going forward. But we still expect growth, as we said. In terms of health care, so strong performance, before we go into that, strong performance across both business units as well, I would say. So health care up 11.8%, price up 6.8% with healthy growth in volumes too, and margin accretion across all profit metrics. So EBITDA level, 48.9 million. John mentioned the margin rate at 11.3%, which is 140 basis points year on year. In terms of the loss on the hospital, so that's in line with expectations. It grew from 2.2 million to 3.8 million in the quarter. That's largely because we opened a new hospital financial district in Hyderabad. So that's kind of expected and we expect that to improve as the year goes on. And I guess just to stress the point on India there. So, you know, I think, as John said, you know, 34% growth year on year in local currency, 14% in euros. Again, against soft comps, but needless to say, we're pleased with that result in terms of the performance of the business. In diagnostics, organic revenue growth of 7.2%, roughly 50-50 between price and volume growth. So even in a challenging quarter for the business, I think, as John said, I think they did a super job. In terms of the EBITDA numbers, 33.4 million. And EBIT grew as well. In terms of the BDPs, they're a lot higher year on year, so 121 higher year on year. That's predominantly due to the fact that we did the SYNLAB acquisition. So the lion's share of the increase on that is as a consequence of that. In other metrics, leverage pleasingly trends down from 3.1 to 2.9. Our tax rate is in line with expectations and guidance at 28%. From a cash flow perspective, bits of a timing challenge here. We had a little bit of a benefit in Q4 and we expect to see a benefit in Q2. So it's not structural change, it's just timing related. So we'll get back to normalised levels from Q2 onwards. And that's the same with net cash flow from operating activities and free recurring cash flow. And the other thing I'd say on this slide is obviously that the ROI continues to grow. So 13.9% versus 13% at year end and 8.3% a year ago. In terms of capex spend, so we spent £26 million in the quarter, roughly 4% of spend. We have said before that we'd spend between 6% and 7% this year, so we'll stand by that. Although we say expansion, that happens later in the year with regards to investment in gyms, etc. But that will flow through. In terms of the splitter capex, broadly speaking, it's roughly two-thirds on healthcare and a third on diagnostics, with 58%. on growth and the balance on maintenance. Again, as we expand into new sites, it will get back to a normal, normalised split of about two thirds on growth and a third on maintenance. And the final thing I'd say on this slide is actually from a medical space perspective, we grew to over a million square metres now. So at the end of year end, we were just under a million. So we added on 110,000 square metres and now we're over a million. And then finally, for me, a reminder of the midterm targets that we gave in February. So we said that our organic revenue would exceed 3.25 billion. We said our adjusted organic EBITDA would exceed 600 million. Our leverage would be below 3%. And our adjusted EBITDA in excess of 430 million and EBIT in excess of 290 million in 2028. So you can see, you know, one quarter in, we're pleased with our progress and we're in line to achieve those targets. Back to you, John.

Thank you, Anand. So, you know, in summary, we've had a solid performance with good double digit growth, margin expansion following it. Yeah, there's been a few challenges in the quarter, but we've kind of navigated those particularly well. and they're not the kind of things that tend to repeat, so that'd be good for us. Really good progress from a fee-for-service perspective. We're developing the business well in both divisions in terms of the relationships we have with our customers. Very important for us to be able to form those relationships and even more important for us to be able to get those relationships to come back and keep repeating their business with us. And that's contributing to our growth and our improved results. So it's good to see. India is always a good subject for us to talk about. People have been expecting us to accelerate the growth. We've been saying that we need to do that in terms to keep on track from an IPO perspective. So it's pleasing to see some of those numbers coming through in local currency, which is great. And we will continue to focus on building the business, looking for growth, but at the same time, ensuring that we're efficient, improving our capacity, and making sure that we balance our positions when it comes to price, cost, and particularly value for customers. So Q1 has been good for us. It has had its challenges, but I think we're excited and energised by the model because it's weathered the storm to have a pun. And we've got other opportunities ahead, which I think is really, really good. So we're looking forward to taking your questions.