Medicover AB (publ)

Welcome to the MediCover Q22026 report presentation. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to the speakers, CEO John Stubbington and CFO Anand Patel. Please go ahead.

Good morning, everybody. It's John here. Welcome to our Q2 2026 report. I think we've got a quarter of positive progression, which we're very pleased with. You can see it's another quarter of double-digit organic revenue growth and margin expansion, which is really what we're aiming for. Strong organic growth of 11.8%. And this is our sixth quarter of improved margins. So we're very pleased with that. It's a record that we're proud of and hope to continue as we go forward. Just a reminder for everybody, this particular quarter has a very strong comparable base. Last year, we made significant movements upwards, so it's even more pleasing to see the progress that we've actually made. And a year or so ago, probably just a year and a quarter, there was a lot of talk about India and what we're going to do in terms of the growth for India. But you can see that over Q1 and Q2, we've had Thank you very much. and leverage was at 2.9. So revenue 640.4, very respectable in terms of the growth rate. You can see that from an organic perspective, it's 11.8, which is very credible indeed. Adjusted EBITDA 109.2, very pleasing to see that and to see our progress. And you can see also with the adjusted EBITDA margin at 17.1, the increase there is not as big, but as I said, there's a very high comparable. So just to see that move in the right direction is very positive for us. Operating cash flow is 73.6%. That's up 28.4%. So really good generation. You know that from our perspective, that's quite important for us because as we do that, it gives us more choices. Leverage, as I said, is at 2.9. That's down from where we were at year end at 3.1. And of course, it's improved quite considerably if we look year on year from 3.6 last year to 2.9. So, you know, good, good, solid set of numbers that we've produced. We're happy with that. If we move forward and just look at the revenue and the progression of the revenue streams, another good quarter, you know, revenue produced at expected levels. So we're happy with that. Revenue by country is very steady, but you can see a strong quarter in India in euros up 23% and local currency much higher. And, you know, as I said, this time last year, it was a big area of debate for us. So it's really pleasing to see the team have continued their progress and got momentum inside that business. And revenue by pay, a little bit of change of mix here happening with different things going on, but very good strength coming through from FIFA service, which is our biggest dream. It's obviously the stream that we want to concentrate on a lot, and it's good to see that growth. Governmental revenue streams in terms of the public pay, lots of micro changes happening there that's affecting it. And we know that in terms of our funded business, we want to continue to develop that. If you look at healthcare services, solid performance by healthcare services. Again, this is the area where probably the comparable base was the highest, so we need to bear that in mind. But, you know, revenue growth 6.9, organic 12.2, so very, very good. And price accounted for 5.2 of that, so... Thank you very much. sports and wellness continues to be strong for us, and we will continue to develop that proposition very strongly. Memberships are relatively unchanged. As I say, Poland grew. Some membership fall in Romania. Quite a bit of that was contract management, so managing the profitable and unprofitable accounts, and most importantly really here, related to the FIFA services that Thank you very much. Thank you very much. Organic growth was up 10.9 and a good proportion of that is in price. And please remember that from a German perspective, the ability to move prices, you know, almost absolutely zero. So very credible performance by the diagnostics team. Feed for service strong. As we said, that's the area of focus. So that's really pleasing to see. We've always focused on making sure we've got a reputation for not only covering the basics, but covering the more advanced side of life. So that's great. Ukraine continued to deliver really solid performance for us. I mean, Q1 we said was softer. A bit of that was reflected by the weather. A bit of that was reflected by the war conditions, but considering the things that they have to overcome, we just have such a fantastic team in Ukraine, and we'd like to thank them for everything they do, because it really is difficult conditions that I don't think any of us would want to trade under. Germany did really, really well. Solid momentum. We're seeing the change in mix continue. service, maybe as a consequence of the environment, but also a consequence of the varied proposition that we have there. Our expansion on BDPs continues, really important for us in terms of the future, so that's very good to see. million that we produce, which is great. Revenue, very solid, 205.1, up 8.5, so very, very good. Continued improvement in the margin. You can see that that's a significant improvement that the team have done there, so very pleasing to see. And, you know, 40.3 is a positive sign, a of the comparable quarter. And if you look through from a country mix, it is again, relatively stable. And you can see the strength of Ukraine coming through with that. And again, our payer mix And that will give us much more stability and, of course, opportunity to move prices as we move forward. So very, very positive signs. So congratulations to everybody in Diagnostic Services. So I'll hand on to Anand, who will talk you through a little bit more detail of the financials, and then I'll come back at the end to summarise. Anand, over to you.

So I'll describe the quarter as a solid quarter and consistency in us delivering double-digit organic growth from a revenue perspective and margin accretion as well. So we're pleased with our numbers. I think one number I'd put out is EBIT. So EBIT of 51.2 million. You can see our margin rate is 8% now, which is up 100 pips year on year. So pleased to see underlying profitability being boosted by, as John said, in some areas, tough comps, but we're still growing our margins year on year and organic growth as well. Other profit measures are up year on year as well, as you can see from the page. One I'll pull out is EBITDAO, which is obviously our best measure of cash profit at 72.7 million. That's up just under 13% with margin accretion of 50 basis points a year on year at 11.3. So we're pleased with that. And as a reminder, in Q2, we paid our dividend of 20 euro cents per share. So that's kind of reflected in our cash flows. From a healthcare perspective, John's mentioned that we had some tough comps from last year, but still pleased with the growth. I'd say a solid performance. So organic growth of 12.2%. And you can see there was kind of growth in both price and volume, which is very pleasing. From an EBITDAO perspective, it's up year-on-year at 55.6 million. There is margin rate dilution year-on-year of 30 basis points. That's predominantly due to the tough comps, as I mentioned earlier. And there's also some one-off activity last year, which is if you strip out, then we'd be up year-on-year. EBITDAO relating to the immature Indian hospitals. You can see the loss on those in the quarter was 3.2. So it's down a bit on last quarter. We're up on last year. Those are predominantly due to the hospital that we opened in Q1 and in line with expectations. But as John says, we're pleased to see the India overall company performance perform really well at the numbers that he mentioned earlier. I'd say a very strong month from diagnostics, so solid in healthcare, strong in diagnostics, so organic growth of 10.9%. Again, pleasing to see volume growth as well as price growth across both. EBITDA of 30.3 million, which is very strong, with margin rate up 110 basis points at 14.7%. I think obviously we kind of concluded on the two acquisitions we did in Q2 last year and it's pleasing to see in both healthcare as well actually and in diagnostics that the synergies we've realised are helping boost our numbers year on year. In other metrics, so leverage trends down, so it's below three, which is good compared to last year as our increasing profitability kind of offsets the fact that we're kind of keeping our invested base safe from a debt capital and equity capital perspective. You'll have seen that we increased and strengthened our liquidity in Q2. So in May, we managed to increase our RCF from 300 million to 400 million. That gives us more scope and more optionality and headroom to take further investment decisions in the future should we choose to. I've mentioned the dividend we've paid of €30 million in Q2. Taxes in line with expectations at 28%. An improved performance in cash versus Q1, with net operating cash flow at 28% at €73.6 million, and free cash flow at 4.1% of revenues versus 3% last year. And finally, on ROIC, kind of an improvement there as well, so 13.6% versus 9.3% last year. So I'd say a good performance on those measures. In terms of capex, if you look on the left, you can see this clear blue water between our free cash flow and our growth capex, which is good. Our capex overall was 29.7 million in the quarter, about 4.6% of revenues. I've mentioned previously that we'll be around 6% of revenues for the full year, and we'll stick to that. In terms of the type of spending, where the money was spent in the quarter, two-thirds was in healthcare services and a third in diagnostics. The maintenance growth split is 44%, 56% in this quarter. However, looking forward for the full year, we expect to revert back to more two-thirds on growth and a third on maintenance. And finally, medical space of just over 1 million square metres. And finally, with regards to our midterm targets to 2028, we still expect to achieve them. So organic revenue of 3.25 billion, adjusted organic EBITDA of 600 million, leverage under three, and all the other measures highlighted in the bottom right corner, including EBIT, we expect to achieve that for that. So with that, I'd like to say thank you, and I'll hand back to John to wrap up.