jp morgan healthcare conference 2017s22.q4cdn.com/106882444/files/doc_presentations/tivity... ·...
TRANSCRIPT
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© 2017 Tivity Health, All rights reserved.
DonatoTramuto — ChiefExecutiveOfficer
1-10-2017
JPMorganHealthcareConference2017
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SafeHarborProvisions
Theseforward-lookingstatementsspeakonlyasofthedatehereofandthispresentationcontainsforward-lookingstatementsthatarebaseduponcurrentexpectationsandinvolveanumberofrisksanduncertainties.InorderforHealthways toutilizethe“safeharbor”provisionsofthePrivateSecuritiesLitigationReformActof1995,investorsareherebycautionedthatthesestatementsmaybeaffectedbytheimportantfactors,amongothers,includedinthediscussioninheadingssuchas“RiskFactors”inHealthways'AnnualReportonForm10-KfortheyearendedDecember31,2015andotherreportsfiledwiththeSecuritiesandExchangeCommission.Consequently,actualoperationsandresultsmaydiffermateriallyfromthoseexpressedintheseforward-lookingstatements.Healthways undertakesnoobligationtoupdateorreviseanysuchforward-lookingstatements.
Thispresentationcontainscertainnon-GAAPmeasures.TheCompany’searningsreleasesfortheyearendedDecember31,2015andforthequarterandninemonthsendedSeptember30,2016,locatedontheCompany’sinvestorrelationspageatwww.healthways.com includeareconciliationofthedifferencesbetweencertainnon-GAAPfinancialmeasureswiththemostdirectlycomparablefinancialmeasurescalculatedinaccordancewithGAAP. Thesenon-GAAPfinancialmeasuresshouldnotbeconsideredanalternativetoGAAPfinancialmeasures
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ACompanyTRANSFORMEDLookingBack– ThePathin2016
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ANewandExcitingBrand,andCompany
(placeholder – Tivity Health Video)
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ANewandCompellingBusinessModelFROM TO
Total populationhealth Targeted populationhealth
Diffused productportfolio Focusedandintegratedportfolio
Operationallycomplex Streamlinedandsimplified operations
Difficultypredictingrevenue Predictablerevenue,withgrowth
Unprofitable,capitalintensive Profitable,capitallightservicemodel
Modest CashGeneration/Leveraged SignificantCashGeneration,Balance SheetFlexibility
Products lookingforMembers–BrandCommodity
Memberslookingforproducts–SolidBrandEquity
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Weareservingapowerfuldemographicexperiencingunprecedentedgrowthwithunderservedneedsweareuniquelypositionedtoaddress
© 2017 Tivity Health, All rights reserved.
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MassiveandGrowingmarket
55M
111MADULTSAREAGE50+
ARE65+ ANDMEDICAREELIGIBLE
300,000PEOPLETURN65EVERYMONTH
populationisaging-inatanunprecedentedrate…
…andopting-intomanagedcareplans
MedicareAdvantage&MedicareSupplementplansaregrowingbothenrollmentandshareofthetotalmedicarepopulation
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OurMissionWhyweexist
We empower olderadultstolivetheirbestlivesnow– withvitality,dignityandpurpose.Weenablehealthyaging— bothinplace,andincommunity.
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OurBusinessPortfolio– TodayAsuiteofproductsthatbringbroadaccess,leadingprogramming,diversebenefitoptions,includingnetworkbuildingexpertiseandutilizationmanagement
CURRENTOFFERING ROLE INTHEPORTFOLIO
KeepingolderAmericansactive,engagedandconnected
GOAL:IncreaseUtilization
Buildingabridgeforthosethatareaging-in,andservingtheneedsofthosecaringforsenioradultsGOAL:IncreaseUtilization
Providingcost-effectiveaccesstoalternativecareoptionsGOAL:ReduceUtilization
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60+13.5M+ELIGIBLEMEMBERS
13,000+
20+HEALTHPLANPARTNERS YEARSOFEXPERIENCE
NetworklocationsincludingLAFitness,24HourFitness,AnytimeFitness,Curves,YMCAsandmore
1,000+AdditionalFLEXvenuesinplaceswhereolderadultsaggregate–communitycenters,seniorliving
communities,andmore
MARKETSHARE TOPMAPLANSUSESSF
9 10outof1#
SilverSneakers®– TheNumbersSpeak!
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7.99.2
10.4 11.4 12.4 13.5
39.6
49.7
58.265.3
76.1
85.6
0
10
20
30
40
50
60
70
80
90
0
2
4
6
8
10
12
14
16
2011 2012 2013 2014 2015 2016
Mem
ber V
isits
Elig
ible
Mem
bers
Growth in Eligible Members and Visits (in MM)
StrongGrowth
2011 2012 2013 2014 2015 2016Total Eligible Members 7.9M 9.2M 10.4M 11.4M 12.4M 13.5M
Medicare Advantage 5.7M 6.7M 7.6M 8.3M 9.1M 10.0M
Medicare Supplement 2.2M 2.5M 2.8M 3.1M 3.3M 3.4M
Total Member Visits 39.6M 49.7M 58.2M 65.3M 76.1M 85.0M*
TotalEligibleMembers
TotalMemberVisits
*Totalmembervisitsfor2016yearendisforecasted
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30+40MELIGIBLEMEMBERS
10,000+
8+PAYORPARTNERS YEARSOFEXPERIENCE
NetworklocationsincludingLAFitness,AnytimeFitness,Curves,YMCAs
andmore
healthypeople|results |savings
Prime® bythenumbers
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25+20M+ELIGIBLEMEMBERS
88,000+
30+PAYORPARTNERS YEARSOFEXPERIENCE
NationalnetworkofpractitionersandprovidersincludingPhysicalTherapists,
OccupationalTherapists,SpeechTherapists,Chiropractors,Acupuncturists
andMassageTherapists
WholeHealth LivingTM bythenumbers
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ThreePrioritiesGuidingour2017Focus
AddNewMembersinallthreenetworks
Buildmoreempowermentandengagementintheeligiblepopulation
Collaboratewithpartnerstointroducenewproductsandservicesthatleverageourbrandtrust
Resolvebarrierstoengagementandpositivelyinfluencedailydecisionmakingwhilealigningtoourfundamentalgrowthmodel
BrandLoyaltyallowsforotheropportunitiestocreateastickierexperiencethatdrivesloyalty,andoutcomes
Buildawarenessandrelevancewithcurrentandfuturemembers,andrelationshipswiththeirinfluencers
WHATWEAREDOING… …ANDWHY
A
B
C
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KeyFinancialCharacteristics
Consistent EBITDA Margin ProfileAcross all Networks
SILVERSNEAKERSREPRESENTS
Of Revenue
~80%PRIME/WholeHealth Living
REPRESENTS
Of Revenue
~20%
PRIMEGROWTH RATE:
20%
WholeHealth LivingGROWTH RATE:
~ Single Digits
SILVERSNEAKERSGROWTH RATE:
~ Upper Single Digits ~
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FinancialProfileandOutlookKEYMETRICS ENDOF2016 2017
Revenue >$500MM GrowthofUpper SingleDigits
EBITDAMargin >20% Solidly>20%
CapitalInvestmenttoRevenueRatio <2% <2%
NetDebt $215MM- $225MM Reduced~$100MMAidedby$188MMofNOL’s
Debt/EBITDARatio ~2.0X Wellbelow2.0X
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Transformtheagingexperience–reducingtheburdenofchronicconditionsamongolderadults,enablingthesetobetheirbest years,andinspiringthenextgenerationthatthebestisyettocome.
LookingAhead:OurVisionThefuturetowhichweaspire
17© 2017 Tivity Health, All rights reserved.
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Improvefitness,mobility andstability.Engagewheretheywant,how theywant,whentheywant
MOVEMENT
Combatloneliness,isolationandboredombyhelpingthembuildpurposefulconnectionsincommunity
CONNECTION
Improvecognitivehealth,reduceemotionalstress,
anddeveloppurpose
MINDSET
Enhancetheirexperiencewithvalue-addedproductsandservices(e.g.
transportation,nutrition,etc.)
LIFESTYLE
MemberJourney
incommunity|infacilities|inthehome
OurBlueprintfortheFuture
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OneThingthatWon’tChange:OurFocusonMemberExperience
(placeholder – Member Experience video))
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