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August 2016
INVESTOR PRESENTATION
2
Safe Harbor / Disclaimer
This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which relate to future, not past, events and are subject to risks and uncertainties. The forward-looking statements, which address the Company's expected business and financial performance and financial condition, among other matters, contain words such as: “believe,” “could,” “opportunities,” “continue,” “expect,” “may,” “will,” or “would” and other words and terms of similar meaning. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about expected income; earnings; revenues; and growth. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. Factors that could cause actual results to differ materially from these forward-looking statements can be found in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and the Company’s other reports filed with the Securities and Exchange Commission. These or other uncertainties may cause the Company’s actual future results to be materially different than those expressed in any forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statements. This presentation also contains estimates and other statistical data made by independent parties and by us relating to market size and growth and other data about our industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates of our future performance and the future performance of the markets in which we operate are necessarily subject to a high degree of uncertainty and risk.This presentation also contains non-GAAP financial measures. You can find a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures in the appendix to this presentation.
Press Ganey Overview
MissionTo help healthcare organizations reduce patient and caregiver suffering and improve clinical quality, safety and the overall patient experienceTransformational SolutionsPatient ExperienceCaregiver EngagementClinical QualityReliability & Safety
3
4
Disruptive Forces In Healthcare
Shift to value-based models/Population health Process to outcome measures Narrow networks
Growth in Spending
Patient-centricity Caregiver Engagement / Care coordination Operational integration and advanced analytics Demand for reliable measures Honor consumer through transparency Brand awareness / Patient Loyalty/ Market Share
Increased patient engagement Focus on performance and outcomes Expanded CAHPS programs
Care Redesign
Market ResponseHealthcare Dynamics
Expanding Regulation
Rise of Consumerism
Industry Leader With Partners AcrossThe Continuum Of Care
80%+
60%+
80%+
70%+
Note: All information as of 12/31/15 5
Acute Hospitals
Major Teaching Hospitals
MD Groups w/ >50 Physicians
Acute Hospitals w/ 100+ Beds
Strategic Competitive Advantage
ThoughtLeadership &
Innovation
400+Client-FacingAssociates
Technology& DigitalPlatform
Analytics& Insights
Advisory &Consulting
6
OUR SOLUTIONS
Actionable data targeting improvement opportunities Drive patient loyalty, improve outcomes, optimize reimbursement
Operational, Clinical & Financial Performance Improvement
8
Engagement insights tiered for effective action planning Retain caregivers, increase productivity, improve performance
Measure, report and act on clinical and quality performance Achieve nursing excellence and quality standards, improve outcomes
Assess operational, quality and safety performance Transform culture, reduce safety events, achieve high reliability
C-Level Solutions that Drive Performance ImprovementPatient Experience
Demo
nstra
ted RO
ICaregiverEngagement
Clinical &Quality Outcomes
Reliability &Safety Consulting
Differentiated Products Built On Leading Digital Platform
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4.5 3.9 3.7
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Low Middle High
Avera
ge Le
ngth
of Sta
y (Da
ys)
Reliability Score Rank by Tercile
1. Reliability and length of stay data derived from our 2013 HCAHPS all-facilities database, N=2,289,639.2. Based on Medicare Spending by Claim, 2014 Hospital Compare and Billian’s 2014 data, N=3,080.
15.0%
8.7%5.9%
12.1%
0%
4%
8%
12%
16%
20%
Bottom Decile Top Decile
~6% less spending due to readmissions
Patient Experience Solution Foundational To Clinical And Financial PerformanceAverage Length of Stay by Patient Experience Reliability Tercile (1)
Lower Cost of Care, Higher Operating Margin for Top Performers on HCAHPS (2)
Patient Experience is a Powerful Tool for Performance Improvement
Hospital Net Margin
10
% of Spending on Readmission
HCAHPS Overall Rating
71 70 77
82 75 76
84
31 23
42 37
50
63
47
0
20
40
60
80
100
Nurse Responsiveness Physician Pain Medication Discharge Rating
Avera
ge Na
tiona
l Perc
entile
Rank
Top Quintile of Employee Engagement Bottom Quintile of Employee Engagement
National Percentile Rank Based on Employee Engagement Scores (1)
Employee Engagement Improves Patient Experience
1. Based on Engagement data from 36 projects, year 2014. HCAHPS data from 2014 PG Database.
Complementary Solutions Accelerate Performance Improvement
11Created by Healthcare Metrics Team.
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Census Based Surveying Enables Innovation: Transparency Study
• Census Based Surveying increases patient data by 80%• UT Transparency has resulted in 50%+ of docs in 90th percentile in 2014
Dr. CampbellPress Ganey Data1164 Reviews4.6 Stars vs Vitals 2.5
Dr. CampbellPress Ganey Data1164 Reviews4.6 Stars vs Vitals 2.5
Dr. CampbellPress Ganey Data1164 Reviews4.6 Stars vs Vitals 2.5
Dr. LeiserPress Ganey Data74 Reviews4.9 Stars vs. Vitals 2.5
Dr. LeiserPress Ganey Data74 Reviews4.9 Stars vs. Vitals 2.5
Dr. LeiserPress Ganey Data74 Reviews4.9 Stars vs. Vitals 2.5
Industry Leading Sales And Client Management Teams
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400+Client Facing Associates
Transformational Consultants
Sales Professionals
Advisory Professionals
Account Management Supporting Clients
4473135162 Geographically-based model for majority of client base
Innovation And Thought Leadership Offer Deeper Value To Clients
Executive Council members of Press Ganey nonprofit
Speaking engagements
Clients at national conference
Attendees across regional symposiums
Monthly user logins for improvement solutions
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Investing in Thought Leadership28 245+
2,800
1,000+
265,000+
Industry articles in key trade publications
Participants in the online community
Custom analytic reports generated annually
300+
26,0003,000+
Participants in CNO Quarterly Best Practices Roundtable
250
GROWTH STRATEGY / TOTAL ADDRESSABLE MARKET
Total Addressable Market
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Quality, Safety, Consulting, Other
Existi
ng Cli
ents
Prospe
cts
Patient Experience
Caregiver Engagement
$319 Million (2015 PGND Revenue)
Patient Engagement, Care Coordination, Other Consulting
$865 Million
$294 Million
$2.7 Billion
New SolutionsExisting Solutions
$4.2 Billion Total Addressable Market
$1.5 Billion
Proposed Mandatory
2018
Medical Practices
Expanding CAHPS Requirements Will Accelerate Improvement Efforts
2%2%2%
Hospital Outpatient Surgery Departments Voluntary
2016 2017
Ambulatory Surgery Centers Voluntary Proposed Mandatory
Pediatric Inpatient HospitalsEmergency Departments Planning Anticipated Voluntary Anticipated Mandatory
Long Term Care Hospitals Planning Anticipated Voluntary Anticipated Mandatory
Inpatient Psychiatric Facilities Planning Anticipated Voluntary
InpatientDialysisACOsHospiceHome Health
Mandatory
Inpatient Rehab Facilities Planning Anticipated Voluntary Anticipated Mandatory
Voluntary
Mandatory Anticipated Voluntary (with new MIPS)
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Strategic Acquisition Track Record
18
2009
Caregiver Engagement
Safety/Consulting
Clinical/Quality
PatientExperience
2013 2014 2015 2016
FINANCIAL REVIEW
Financial Overview
20
RevenuePredictability
Retention: 97% client retention / 94% revenue retention 3-year average Q2 2014 –Q2 2016
Visibility: Average contract life for top 100 patient experience clients is 2.9 years
Existing Solutions: $1.2B White space New Solutions: $2.7B Opportunity
Cost of Revenue: Greater percentage of insights from electronic platform Technology Improvements: Redesign of platforms for collecting and sharing data Sales Force: Broader product offering Adjusted EBITDA less Capital Expenditures: 79% of Adjusted EBITDA from
2012 to 2015, 83% YTD 2Q16 Balance Sheet: deleveraged and lower interest rates
Organic Growth
OperatingLeverage
Cash Flow
Long Term Growth Targets Revenue: 7-9% organic / 2-3% acquisition Adjusted EBITDA: 13-15%
$0$50
$100$150$200$250$300$350
2012 2013 2014 2015 YTD2Q15
YTD2Q16
Revenue
Growth Track Record($ in millions)
$0
$25
$50
$75
$100
$125
2012 2013 2014 2015 YTD2Q15
YTD2Q16
Adjusted EBITDA
21
5.4x
4.6x4.0x
1.3x 1.0x
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
2012 2013 2014 2015 YTD 2Q16
Total Net Debt (1) / Adjusted EBITDA Ratio
Adjusted EBITDA Less CapEx & Leverage Ratio
1. Net debt = total debt – cash.
($ in millions)
$0$10$20$30$40$50$60$70$80$90
$100
2012 2013 2014 2015 YTD2Q16
Adjusted EBITDA Less Capital Expenditures
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APPENDIX
Adjusted EBITDA Reconciliation
1. Includes costs associated with modification of equity awards in connection with the liquidating distribution and IPO of $70,438 in May of 2015.2. Write-off of unamortized deferred financing fees, loss on original issue discount and lender fees in connection with debt refinancings.3. Non-cash property and equipment and intangible impairment charges related to the discontinuation of certain clinical solutions in 2013.4. Management fees paid to Vestar.5. Transaction costs incurred in connection with completed and potential acquisitions.6. Expense associated with executive separation agreements and targeted employee headcount reductions.7. Primarily consists of professional fees incurred for the preparation for compliance with Section 404 of the Sarbanes-Oxley Act and for design of the equity incentive and
compensation programs, professional fees incurred in connection with the IPO and capital structure, corporate strategic planning and technology consulting projects, as well as expenses and revenue credits related to client retention due to the discontinuation of certain clinical solutions and software applications.
Fiscal Year ended December 31 YTD($ in thousands) 2012A 2013A 2014A 2015A 2Q15 2Q16Net income (loss) $(7,391) $99 $15,583 $(36,627) $(47,843) $16,046Interest expense 32,157 24,644 19,832 11,163 8,354 2,366Income tax expense (benefit) (604) 5,926 13,196 7,528 (1,360) 13,169Depreciation & amortization 27,202 32,468 35,102 41,224 20,096 23,115EBITDA $51,364 $63,137 $83,713 $23,288 $(20,753) $54,696Equity-based compensation(1) 14,256 9,787 8,034 86,745 74,997 13,349Extinguishment of debt (2) 7,185 7,922 2,894 1,750 638 -Non-cash impairment charges (3) - 2,579 - - - -Management fee to related party (4) 968 907 1,047 553 553 -Acquisition expenses (5) 1,327 902 462 945 203 1,191Severance (6) 2,797 625 1,084 2,095 - 709Loss (gain) on disposal of property & equipment - 274 1,719 307 (31) 20Other non-comparable items (7) 1,465 2,159 3,606 1,802 864 106Adjusted EBITDA $79,362 $88,292 $102,559 $117,485 $56,471 $70,071
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Adjusted EBITDA Less Capital Expenditures
Fiscal Year ended December 31 YTD
($ in thousands) 2012A 2013A 2014A 2015A 2Q16
Adjusted EBITDA $79,362 $88,292 $102,559 $117,485 $70,071
Capital Expenditures (18,191) (17,230) (19,414) (26,197) (12,231)Adjusted EBITDA Less CapitalExpenditures $61,171 $71,062 $83,145 $91,288 $57,840Adjusted EBITDA Less CapEx as Percentage of Adjusted EBITDA 77% 80% 81% 78% 83%
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Capitalization
As Reported
($ in thousands) 12/31/12 12/31/13 12/31/14 12/31/15 6/30/16
Cash $7,845 $32,635 $6,962 $35,235 $46,383
Total Debt $431,851 $434,423 $418,319 $189,267 $182,575
Net Debt $424,006 $401,788 $411,357 $154,032 $136,192
LTM Adjusted EBITDA $79,362 $88,292 $102,559 $117,485 $131,085
Total Net Leverage 5.3x 4.6x 4.0x 1.3x 1.0x
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