GLOBAL HEALTH PARTNER

Q3 REPORT2 NOVEMBER, 2012

Marianne Dicander Alexandersson, CEOTobias Linebäck, CFO

Agenda

2

Q3 performance

Market trends and opportunities

Focus going forward

Actions taken so far

Figures and graphs

Financial summary

Disappointing performance in Q3

3

• Disappointing growth and profitability

• 7 percent growth

• EBIT -13 MSEK (-12) (accumulated EBITDA 12,3 MSEK)

• Effects from lost contracts with county councils

• Continued tough market situation in Sweden and Denmark with intense competition and depressed prices

Market trends and opportunities in Sweden

4

POLITICS/MEDIA • Strong political focus on profits• Quality, openness and long-term perspective

PATIENT TRENDS • Increasing patient power• Patient free choice and insurance companies

PUBLIC TENDERS/ FREE CHOICE SYSTEM

• High focus on price• NKI, New Karolinska, opportunities for

elective care

Continued price pressure and consolidation in Denmark

5

POLITICS/MEDIA • Prolonged care guarantee will increase waiting times

MARKET TRENDS• Consolidation and squeeze out of smaller

providers

• Price pressure from insurance companies

QUALITY TRENDS • Accreditation requirement increases barriers of entrance

Revenues from insurance companies growing in importance

6

63 63 63 6153

16 17 20 21 31

21 20 17 18 16

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2009 2010 2011 2011 Jan-Sept 2012 Jan-Sept

Revenue distribution

PrivateInsurance companiesCounty councils

Greater focus will increase profitability

7

FROM…

• Growth in selected markets

…TO

Focus on

• Growth in Nordic region

• Core business

Morepatients

ProcessImprove-

ment

Actions taken so far

8

Focus only on core business, where we can add value

• Closure of Bariatric Center Copenhagen (Q2)

• Sale of Bodylift center (Q3)

• Sale of Nacka property (Q3)

Focus on growth in the Nordic region

• Acquisition of Odenplan (Q4)

• Sale of Cairo (Q4)

• Opening of Orthocenter Skåne in Malmö (Q4)

Continued challenging market

Revenue• 7 percent growth - revenue increased from 129 to 138 • 6 percent accumulated growth – revenue increased from

488 to 518• 11 percent growth in Q3 from Danish acquisition• Also growth from areas where there is high patient power• Negative organic growth due to

• Lost VGR contracts• Continued high competition and price pressure

• Increasingly strong positions with insurance companies, provides a solid base for future positioning in the market place

Revenue rolling 12 months

• Rolling 12 months continue to increase and now amounts to SEK 704 million

• The acquisition of Gildhöj constituted the growth for the third quarter

9

SEK millionsQ3

129 138

2011 2012

666675

689696

704

646624

586559

544

0100200300400500600700800

Kv22010

Kv32010

Kv42010

Kv12011

Kv22011

Kv32011

Kv42011

Kv12012

Kv 22012

Kv 32012

Weak performance – Q3

EBITA

• Weak performance where especially SL Ortho/Spine is underperforming

• One-off items of net +2,9 MSEK has affected the EBITA

• Good performance in the Bariatric Service Line

• Cost savings and volumes from VGR are paying off

• Gastro is performing well overall

• Adverse effects from continued hard price competition in tenders and effects from lost contract with VGR

SEK millions

10

• Average prices per procedure have in many cases decreased with 20–30% during the last 5 years

• Actual price decrease• Changed patient mix• Efficiency has increased but not enough to

meet the significant price drops• Continued measures are taken to adjust capacity

and costs and efficiency• EBITDA for Q3 amounted to -4,9 which reduced the rolling 12

EBITDA to 23.

-12 -13

2011 2012

3031

4957 56

5042 38

24 23

0102030405060

Q22010

Q32010

Q42010

Q12011

Q22011

Q32011

Q42011

Q12012

Q22012

Q32012

EBITA

EBITDA

Q3

11

Service Line Ortho/Spine

• Very strong provider of orthopaedic and spine treatments in Sweden

• Organic growth only in clinic in Stockholm subject to free choice

• Lost VGR contracts affect profitability

• Challenge is to fully meet the heavy price reductions through increased efficiency

• Price reductions in Denmark following tenders by insurance companies

• Results below are affected by allocated segment costs amounting to -2.1 million in Q3

SEK millionsQ3

2012Q3

2011Change

%9 months

20129 months

2011Change

%

Full-year2011

Revenue 81.0 73.1 11 319.0 265.9 20 379.6

Operating profit* -9.4 0.3 6.1 28.5 35.3

Operating margin, % -12 0 2.0 11.0 9

* Excluding goodwill write-down of 7 MSEK in OPA in Q3 2012

12

• Maintained revenue despite continued decline in market for dental implants. Market is believed to have stabilized

• Reduced profitability due to less good patient mix

• Also changed dynamics between referral dentists and specialists

• Results below are effected by allocated segment costs amounting to 0 million in Q3

* Excluding profit from sale of property in Q3 and write down of goodwill in full year 2011 and Q3 2012

Service Line Dental

SEK millionsQ3

2012Q3

2011Change

%9 months

20129 months

2011Change

%Full-year

2011

Revenue 14.5 14.7 -1.0 66.6 64.5 3.0 92.3

Operating profit* -1.1 -0.4 5.0 4.6 6.5

Operating margin, % -8.0 -3.0 8.0 7.0 7.0

Service Line Bariatrics

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• Heavy cost cuts and volumes from VGR are starting to pay off• Gastro clinic in Stockholm is growing and performing well• Market is still very tough and is characterized by high price pressure• During Q2 and Q3, efforts to focus business around core areas have begun

• Bariatrics clinic in Copenhagen was closed during Q2• Reconstructive plastic surgery clinic was sold during Q3• Bariatrics clinic in Cairo was sold during Q4

• Results below are affected by allocated segment costs amounting to -2.9 million in Q3

* Including one-off costs of 1,3 MSEK in Q3 and -4.6 in 9 months

SEK millionsQ3

2012Q3

2011Change

%9 months

20129 months

2011Change

%Full-year

2011

Revenue 36.0 35.5 1 110.5 136.7 -19 174.7

Operating profit* -3.0 -5.2 -10.9 -2.0 -0.2

Operating margin, % -8 -15 -10 -1.0 0

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• Solid growth and profitability

• Relatively stable future patient flow is expected

• Results below are effected by allocated segment costs amounting to -0.4 million in Q3

Service Line Arrhythmia

SEK millionsQ3

2012Q3

2011Change

%9 months

20129 months

2011Change

%Full-year

2011

Revenue 6.3 5.8 9 21.4 21.3 0 28.6

Operating profit 0.1 0.2 1.9 2.9 2.8

Operating margin, % 2 3 9 14 10

• Weak operating cash flow in the third quarter due to weak performance and some one-off costs

• Cash flow from investing activities mainly consists of investments in health care equipment and sale of property in Nacka

• Cash flow from financing activities include new loans as well as some loan repayments

• Total cash flow is positive in Q3 due to sale of property.

Comments

Positive cash flow due to sale of property – Q3

-40

-30

-20

-10

0

10

20

Q3 2011Q3 2012

SEK millions

15

Operations Investments Financing Total cash flow

Financial summary

16

• Company working hard to change trend with falling EBITDA

• Falling EBITDA has resulted in a break of one of the bank covenants. However, the bank has issued a waiver

• Net debt under control, SEK 86 million in relation to e.g., turnover of SEK 704 million

• Sale of property has released funds of 29 MSEK for use in GHPs core business

• Weaker performance and increased focus on core business have caused one-off costs

• Goodwill write-down of Nacka and OPA due to sale and lease back of real estate and volume drop, however not effecting cash

• Other write-downs and reserves amounting to -4.5 MSEK

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APPENDIX

Performance per geographic area – Q3SEK millions

Comments• All business development costs are included in the Swedish segment

Q32012

Q2 2011

9 months2012

9 months2011

Revenue from business activities

Operating result from business activities SWEDEN

NORDIC REGION

OTHER COUNTRIES

Revenue from business activities

Operating result from business activities

Revenue from business activities

Operating result from business activities

Reported operating result*

103.4

-9.2

101.8

-5.5

408.6 420.4

19.9

30.5

-3.7

19.5

-6.6

95.8

-15.7 -8.1

3.9

-0.1

7.8

0.4

13.1

4.2

24.8

-0.1

-13.0 -11.7 -13.5 11.7

18

43.2

-2.0

* All numbers excl. goodwill write downs

Reduced margins in mature business – Q3

Comments• Mature clinics are clinics that have been in operation for at least 24 months

• Central administration costs for the Group are included in the mature business

• Central expansion and project costs are included in the Newly opened and development business

Q32012

Q32011

9 months2012

9 months2011

Revenue

Operating resultMATURE BUSINESS

NEWLY OPENED AND DEVELOPMENT

Revenue

Operating result

Reported revenue

Reported operating result*

131.2

1.1

119.2

2.3

492.7

28.6

449.9

46.8

6.6

-14.1

9.9

-14.0

24.8

-42.1

38.5

-35.1

137.8

-13.0

129.1

-11.7

517.5

-13.5

488.4

11.7

19

SEK millions

* All numbers excluding goodwill write downs

Q3 2012

Q2 2012

Q1 2012

Q4 2011

Q3 2011

Q2 2011

Q1 2011

Q4 2010

Q3 2010

Q2 2010

Q1 2010

Q4 2009

Q3 2009

Q2 2009

Total cash 88 83 75 98 95 121 139 137 133 145 152 163 155 190Shareholders equity incl. minority 340 395 403 409 439 451 455 475 515 522 514 513 511 550

Long term debt 234 230 247 236 252 262 263 253 131 134 129 136 115 119

Net cash position -86 -83 -102 -58 -66 -11 7 14 9 20 33 36 23 62

Equity ratio 47 50% 50 % 54% 54% 55% 54% 54% 68% 67% 69% 68% 67% 69%

Net debt / EBITDA rolling 12 3.4 3.43 2,7 1.4 1.3 0.19 n/a n/a n/a n/a n/a n/a n/a n/a

Int bearing debt / EBITDA rolling 12 7.6 7.2 4,9 3.8 3.2 2.4 2.4 2.5 4.0 6.1 11.7 16.8 11.6 28.9

Int bearing debt / adjusted EBITDA rolling 12 7.3 7.2 4,9 3.8 3.2 2.4 2.4 2.5 2.9 3.9 5.5 6.7 9.9 10.9

EPS -0.81 -0.12 -0.05 -0.46 -0.19 0.09 0.04 0.13 -0.07 0.09 -0.01 -0.19 -0.19 -0.01

Basic cash flow from operating activities per share

-0.41 0.35 -0.12 0.17 -0.27 0.19 0.00 0.38 -0.07 0.08 0.03 0.32 -0.32 0.05

Shareholders equity per share, SEK 5.09 5.96 6,08 6.18 6.65 6.83 6.84 6.81 7.41 7.53 7.44 7.45 7.55 7.8

Number of employees 382 382 355 372 364 360 367 324 306 302 297 288 281 282

Revenue per employee 0.36 0.49 0.54 0.50 0.35 0.50 0.49 0.55 0.36 0.52 0.47 0.52 0.33 0.47

Financial key data – Q3SEK millions

20

Note: The equity ratio has been re-calculated from the period Q4 2010 and onwards as a result of the change in accounting for put options.

www.globalhealthpartner.com

Twitter: @ghpartner

Contact:

Marianne Dicander Alexandersson, CEO, +46 (0)705-62 85 55 marianne.dicander@ghpartner.comTobias Linebäck, CFO and IR, +46 (0)708-55 37 19, tobias.lineback@ghpartner.com

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