2014 Annual Shareholder Meeting - Cerner Corporation

May 23, 2014

2014 Annual Shareholder Meeting

Neal Patterson

Chairman, CEO and Co-Founder

May 23, 2014


3 © Cerner Corporation. All rights reserved.

This document contains Cerner proprietary information belonging to Cerner Corporation and/or its related affiliates which may not be reproduced or transmitted in any form or by any means without the express written consent of Cerner.

Agenda

WelcomeNeal Patterson

Chairman, Chief Executive Officer and Co-Founder

IntroductionsCliff Illig

Vice Chairman and Co-Founder

Business MeetingMarc Naughton

Executive Vice President & Chief Financial Officer

2013 HighlightsZane Burke

President

Corporate Imperatives

& Cerner's Growth

Mike Nill

Executive Vice President & Chief Operating Officer

Chairman's Comments

& Q&A

Neal Patterson

Chairman, Chief Executive Officer and Co-Founder

Cliff Illig

Vice Chairman and Co-Founder

May 23, 2014

Introductions



Introductions

Cerner Board

• Neal L. Patterson

• Clifford W. Illig

• Dr. Gerald E. “Gary” Bisbee

• Dr. Denis A. Cortese

• The Honorable John C. “Jack” Danforth

• Mitchell E. Daniels, Jr.

• Linda M. Dillman

• Dr. William B. “Bill” Neaves

• William D. “Bill” Zollars

Auditors

• Dana Foote, Erik Sisel & Mike Torti

KPMG LLP

Inspectors of Election

• Jim Allen and Craig Evans

Stinson Leonard Street LLP

Cerner Executive Presenters

• Marc Naughton, EVP & Chief Financial Officer

• Zane Burke, President

• Mike Nill, EVP & Chief Operating Officer

Other Cerner Executives

• Joanne Burns, SVP & Chief Strategy Officer

• Katie Chaffee, SVP, Worldwide Consulting

• Dick Flanigan, SVP, Client Organization

• Paul Gorup, SVP, Chief of Innovation & Co-Founder

• Mike Neal, SVP, Strategic Business Units

• John Peterzalek, SVP, Client Relationships

• Randy Sims, SVP, Secretary & Chief Legal Officer

• Matthew Swindells, SVP, Population Health & Global Strategy

• Don Trigg, President, Cerner Health Ventures

• Julie Wilson, EVP & Chief People Officer

Marc Naughton

Executive Vice President and Chief Financial Officer

May 23, 2014

Business meeting



Record Date: Shareholders of record as of March 26, 2014 are entitled to vote

Notice of Meeting: Randy Sims, Secretary, has confirmed notice of meeting was properly given in accordance with our bylaws

Quorum: Randy has determined a quorum is represented, either in person or by proxy

Voting:

• If you have not yet voted or turned in your proxy, the voting table is open and located outside the auditorium

• Voting will close 10 minutes following the conclusion of this meeting

Agenda/Rules: We will follow the Agenda and Rules distributed at the registration table. Please see the registration table if you did not receive a copy.

Administrative Items



Order of Business:

1. Election of three Class I Directors to a

three-year term:

• John C. Danforth

• Neal L. Patterson

• William D. Zollars

2. Ratification of the appointment of

KPMG LLP as the independent

registered public accounting firm of

Cerner Corporation for 2014.

3. Advisory vote to approve the

compensation of our Named

Executive Officers.

Business Meeting



Preliminary Results

A preliminary tally of proxies and votes indicates:

• Agenda Item 1

• A majority vote in favor of each Director nominee

• Agenda Item 2

• A majority vote in favor of approving the ratification of KPMG as Cerner Corporation’s independent registered public accounting firm for 2014

• Agenda Item 3

• A majority vote in favor of the advisory vote on the executive compensation of our Named Executive Officers

The final tally and verification of all votes will be completed by the

Inspectors following the conclusion of this meeting

Business Meeting Continued



Safe Harbor Statement

This presentation may contain forward-looking statements, including without limitation, those regarding

projections of future revenues or earnings, operating margins, operating expenses, product development and

new markets or prospects for the Company’s solutions. Actual results may differ materially from those

expressed in such forward-looking statements. Factors that could cause or contribute to such differences

include, but are not limited to:

(a) the possibility of product-related liabilities; (b) potential claims for system errors and warranties; (c) the possibility of interruption at

our data centers or client support facilities; (d) our proprietary technology may be subject to claims for infringement or misappropriation

of intellectual property rights of others, or may be infringed or misappropriated by others; (e) risks associated with our non-U.S.

operations; (f) risks associated with our ability to effectively hedge exposure to fluctuations in foreign currency exchange rates; (g) the

potential for tax legislation initiatives that could adversely affect our tax position and/or challenges to our tax positions in the United

States and non-U.S. countries; (h) risks associated with our recruitment and retention of key personnel; (i) risks related to our

dependence on third party suppliers; (j) risks inherent with business acquisitions and combinations; (k) the potential for losses resulting

from asset impairment charges; (l) risks associated with volatility and disruption resulting from global economic conditions; (m) managing

growth in the new markets in which we offer solutions, health care devices and services, (n) changing political, economic, regulatory and

judicial influences; (o) government regulation; (p) significant competition and market changes; (q) variations in our quarterly operating

results; (r) potential inconsistencies in our sales forecasts compared to actual sales; (s) volatility in the trading price of our common

stock and the timing and volume of market activity; (t) our directors’ authority to issue preferred stock and the anti-takeover provisions in

our corporate governance documents; and (u) material adverse resolution of legal proceedings.

Additional discussion of these and other risks, uncertainties and factors affecting the Company's business is

contained in the Company's periodic filings with the Securities and Exchange Commission. You should not

place undue reliance on forward-looking statements, since the statements speak only as of the date that they

are made. The Company undertakes no obligation to update forward-looking statements to reflect changed

assumptions, the occurrence of unanticipated events or changes in future operating results, financial condition

or business over time.

Zane Burke

President

May 23, 2014

2013 Highlights



2013 Highlights

Record Bookings of $3.8B

• Up 20% on very tough comparable

• Growth in base and new footprints

• >$1B of new footprint bookings

• Strong win rate

Physician market success

• Bookings/Revenue growth of 42%/24%

• 18 signature displacements

• Added 16,000 providers, now over

60,000

Strong ITWorks and Revenue Cycle

• ITWorks revenue up 53% to $184M

• Revenue Cycle up 51% to $156M

Launch of

• Platform Delivered

• Four Regional Pilots Launched

http://www.commonwellalliance.org/



Strong Pipeline and Competitiveness

Pipeline

More than doubled since end of

2010

After bookings of $9.6B in 2011-

2013

• All categories experiencing

sustained upward trend

Competitiveness

• Win rate doubled since 2010

• Investments in physician experience and

revenue cycle paying off

• Differentiation in population health, which is

playing bigger role in selection process

• EMR-agnostic solutions contributing to

success outside base

• Population health and device connectivity



Marketplace Trends

Raining Measures

and Mandates

Driving Focus on Quality and

Costs

IT biggest remaining lever

– Cerner solutions &

services align with client challenges

Consolidation

Providers seeking scale

across continuum

Cerner Clients Leading

Industry Winners and

Losers

Gap after top two widening

Cerner trend very positive

Another EMR Wave

Expect approx. half of market

to evaluate options

Cerner well positioned

Revenue Cycle

Integrated clinical /

revenue cycle clearly favored

Significant Cerner

Opportunity

Population Health

Shift to at-risk model

Cerner’s approach:

Real Time

Actionable in Workflow

Programmable



Potential HIT impact of Hospital M&A 2013 Cumulative Year

MEDITECH

*Total Acquisitions – Total acquisitions by clients

**Potential Losses – Total acquisitions by competitors clients

Source: HIMSS Analytics 2013

**

*

-30

-10

10

30

50

70

90

110

130128

26 23

12

2 6

116

24 18

-12 -13

-25

104

11

-7

Acq

uir

ed H

osp

ita

ls

EMR footprint in 17 of top 30

U.S. Health Systems

Cerner clients accounted for 61% of buying activity



EMR Waves Transition to Population Health

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

HITECH MU Stage 1

Starts

VBP &

Readmissions

MU Stage 2

Starts

ICD-10

Transition

MU Stage 3

Starts

P.P.A.C.A

MU Stage 1

Rules Finalized

MU Stage 2

Rules Finalized

ACO Rules

Released

Population Health

Adoption Curve (Estimated)

EMR Adoption Curves (Estimated)

EMR Next Wave Drivers Replacing Outdated Technology

Cost Control

Health System Consolidation

Choosing Supplier With Vision

Fee-for-Service Shifts to At-Risk

Mostly

Replacement Two suppliers share

most of business

Greenfield and

upgrades of

existing EMR Multiple suppliers

benefit

Greenfield New Competitive

Landscape

Incumbent

Advantage

Mike Nill

Executive Vice President and Chief Operating Officer

May 23, 2014

Corporate Imperatives and

Cerner’s Growth



Physician Population

Revenue... & Cost Continuum

Intelligence

Member +1

One plan connecting all...

Including the Home, Home care,

Behavioral, Long term care and Hospice

P P R C I M +1

Tell the story - The power of the team

Now accountable for health

Now... & Next

Discover > Predict > Prevent

Know me, engage me...

Because it starts with me

I’m unique…

So personalize my plan



Cerner’s Growth and Community Impact

Jobs

•9,598 KC-based jobs; largest public company employer in KC

•4,000 KC jobs created last three years

•~$700M in local payroll

•New and expanded campuses

•Kansas City, KS (Legends)

•Kansas City, MO (Bannister)

Economy

•Annual Cerner Health Conference: ~10,000 guests

•Estimated $7M+ in economic impact

•$170M spent with local suppliers in last year

Community Impact

•First Hand Foundation

•$22M granted and 164,000+ lives impacted since 1995

•Healthe Kids Institute

•43,000+ free health screenings since 2007

•Impact Associate Volunteer Program

•155,000 volunteer hours at 650 organizations since 2008

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

Asso

ciates

Rev

enu

e (m

illio

ns)

Associates

KC Based Associates

Revenue



Two nine-story towers

• 648,000 S.F.

• First tower opened in 2013

• Second tower opened Feb 2014

Designed for “Continuous”

24x7 support of health care IT

projects and operations

• Support strong growth of “Works”

businesses

Incentives will cover

approximately half of

construction costs

Continuous Campus, Kansas City, Kansas

Updated photos?



Three Trails Crossing, Kansas City, MO

237 acres adjacent to our

Innovation Campus

• Purchased Dec 2013 for $42.5M

Space to accommodate

decade+ of growth

• Potential to accommodate

15,000 jobs when fully built out

• To include training center, health

clinic, day care, fitness center

and retail

Over $1 billion of potential

incentives as we build out

space

Rendering

(s) of new

campus

Neal Patterson

Chairman, CEO and Co-Founder

May 23, 2014

Chairman’s Closing Comments and Q&A



Changing lives in Nevada, Mo.

Q&A



Closing

Since there is no further business, this 2014

Annual Shareholders’ Meeting of Cerner

Corporation is hereby closed.

May 23, 2014


Documents

2014 Annual Shareholder Meeting - Cerner Corporation