BGEO Group Financial Update
GHG
Market
shares
GHG
strategy
Capacity
Revenue
In 9M15
17.6%
Georgia healthcare market & GHG market share evolvement
Hospitals
Maintain dominant market share in
hospitals by capacity and revenue
GEL 1.2bln()
Ambulatories
GHG Replicating hospital consolidation
experience in outpatient segment, with a
first mover advantage
GEL 0.9bln
Pharmaceuticals
Redistribution of funds expected
from pharmaceuticals to
ambulatory services
GEL 1.3blno
26.6%
Bed market share
2,000
Hospitals, GEL mln
1,500
1,000
Market
674 643
500
CAGR'03-14: 13.7%
'14-18: 11%
811 858 941
714
2008
2009
2010
2011
2012
2013
2014
Long-term
target
0.5%
33.0%
In 9M15
33.0%
Long-term
target
Ambulatories, GEL mln
2,000
1,647
1,489
CAGR'03-14: 17.9%
1,341
1,500
1,203
'14-18: 16%
1,075
2015E
2016F
2017F
.
•
•
Growth
drivers
Low utilisation (50-60%)
Fragmented market
Low equipment penetration
System inefficiency (low nurse-to-doctor ratio)
Holding company of BANK OF GEORGIA
GHG: accelerated revenue market share growth
on the back of well-invested asset base
(1) 2015E market value
BGEO www.bgeo.com
GROUP
November 2015
2018F
1,000
500
1,448
1,250
1,079
930
802
695
592
473
376
241 272
2008
2009
2010
2011
2012
2013
•
Low outpatient encounters
Fragmented market
New prescription policy
2014
2015E
GHG: replicating hospital cluster model and
consolidation experience in ambulatory sector
2016F
2017F
2018F
17.0%
0%
38.0%
25.0%
Share in total
Healthcare spending
Year 2014
medium term target
GDP nominal, GEL bln
CAGR'03-14: 11.8%
19.1 18.0
'15-20: 9%
20.7
24.3 26.2 26.8 29.2 30.7 33.21
36.2
47.2
43.2
39.6
2008
4.8%
2009
5.1%
2010 5.3%
2011
5.3%
2012
5.5%
2013
6.1%
2014
6.4%
2015E
7.0%
2016F
7.3%
2017F
• 7.6%
2018F
7.8%
2019F
2020F
Sources: GHG internal reporting: Frost & Sullivan analysis, 2015; NHA, Ministry of Labor, Health and Social Affairs of Georgia; NCDC; OECD, World Health
Organisation and World Bank, 2013 data
new prescription policy introduced in 2014
ambulatory market consolidation
Weakening of existing pharma-duopoly
spending on pharma Georgia's 38% vs 16-17%
in Europe; decreasing trend in comparable
countries
page 40
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