Portfolio and Acquisitions Summary 2019
Listed
portfolio
Georgia Healthcare Group (GHG) overview
http://ghg.com.ge/
GEORGIA
HEALTHCARE
GROUP
GEORGIA
CAPITAL
"
Investment rationale
Very low base: healthcare services spending per capita only US$ 308 (EU average
is US$ 3,2111)
Growing market: healthcare spending growth estimated at 8% CAGR 2020-2021
Value creation potential
Total healthcare market (including healthcare services and pharmacy)
GEL million
Total Market CAGR 2020-2021
of 8%
CAGR
Total Market CAGR 2011-2019 of 13%
4,765
20-21
4,397
4,062
3,760
3,488
968
10%
3,062 3,218
884
806
"
High-growth potential driven by opportunity to develop medical tourism and
Polyclinics (outpatient clinics)
734
2,464
669
2,034
1,552
1,716
543
"
Only integrated player in the region with significant cost advantage in scale and
synergies
438
696
1,092
607
1,217
1,311 1,404
1,504
1,611
1,722 7%
305
343
908
782
675
714
"
"
Well positioned to take advantage of the expected long term macroeconomic and
structural growth drivers
ROIC enhancement and substantially increased free cash flow generation
following the completion of significant three-year investment programme in 2018.
573
659
814
1,013
1,273
1,622
1,508
1,395
1,752
1,903 2,075
9%
2011
2012
2013
2014
2015
2016
2017
2018E 2019E
2020F 2021F
Source: Frost & Sullivan analysis 2017
Pharma
■Hospitals Polyclinics
Medium to long
term strategic
targets by
segment
Hospitals
• Double digit revenue
CAGR
Clinics
Pharmacy and
Distribution
Medical
Insurance
State healthcare spending dynamics
GEL million
10%
Double digit revenue
CAGR - 20%+
• Double digit revenue
CAGR
Increase contribution
to the Group segments
9%
9%
9%
8%
8%
Gradually improving to
28-30% EBITDA margin
•
Gradually improving to
25% EBITDA margin
9%+ EBITDA margin
• Combined ratio <97%
(1)
Double digit revenue CAGR
next 5 years
Source: World Bank, 2016 data.
GHG medium to long term targets
Mid-teen EBITDA CAGR next
5 years
Gradually approaching ROIC
c.15-17%
681
710
760
754
754
574
281
343
305
329
337
364
2015
2016
2017
2018
2019E
2020B
State Healthcare Spending - UHC
State Healthcare Spending - Other
Healthcare spending as a % of total state spending
Source: Ministry of finance of Georgia
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