3Q08 Earnings Release Presentation


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3Q08 Earnings Release Presentation

  1. 1. Earnings release 3Q08 November 14, 2008
  2. 2. Business segments Healthcare Administration Services Dental HMO Assistance Services Ranking: #1 Ranking: #4 Ranking: #1 Number of lives: 1.38 million Number of lives: 751 thousand Number of items: 21.3 million No underwriting risk. Fee business Underwriting of frequency risk only. Underwriting of frequency risk Shared structure Network management – Contact Center – Claims processing 2
  3. 3. Recent events ACQUISITION DENTAL – Today, November 13, 2008, Tempo announces an acquisition of 55% stake of Presdental Assistência Odontológica Empresarial S.A. (Presdental), a dental plan company offering services to approximately 35 thousand beneficiaries. The acquisition of 6% is still subject to ANS approval (Brazilian Health Regulatory Agency). ACQUISITION HEALTH – On 08/31/2008, Tempo acquired 100% stake of Multicare Consultoria e Administração de Recursos em Saúde (“Multicare”), with a total of approximately 15 thousand lives. The acquisition of 51% is still subject to ANS approval. Multicare provides health services to self-insured companies. STOCK BUYBACK PROGRAM - Tempo announced that its Board of Directors approved on 11/13/08 a Buyback program of common shares. The maximum number of common shares on this Buyback program is of 8,276,702 and will last for 365 days. 3
  5. 5. Tempo - Consolidaded Net Revenue - Tempo (R$MM) EBITDA - Tempo ($RMM) Margem EBITDA - Tempo ($RMM) 189,8 9,9% 18,8 142,4 9,3% 13,2 3Q07A 3Q08A 3T07A EBITDA 3T08A 3T07A 3T08A Net Revenue Margem EBITDA NET REVENUES EBITDA EBITDA Margin Net Revenue grew 33.3% in 3Q08 Economies of scale and synergies versus the same period of the continue to boost margins M & A Transactions during 08 and previous year, reaching a total of R$ synergies 189.8 million. 5
  6. 6. Health segment Net Revenue (in R$MM) General and Administrative Expenses (in R$MM) Adjusted EBITDA (in R$MM) 14.9% 16.1% 5.4% 3.6% 112,0 78,2 16,7 12,6 6,1 2,8 3Q07A 3Q08A 3Q07A 3Q08A Net Revenue General and Administrative Expenses 3Q07A 3Q08A REVENUES SG&A EBITDA Revenue growth driven by lives Health segment accumulated a EBITDA powered by growth and increase and Home Care acquisition. total of R$ 16.7 MM in SG&A M&A Growth for 3Q08 came to R$ expenses during the 3Q08, which 33.8MM was R$ 4,1 million above 3Q07. Despite the increase in expenses, Health segment growth in this period generated economies of scale, improving the business margin 6
  7. 7. Dental segment: 2008 pro forma results Net Revenue (in R$MM) Cost of Rendered Services (in R$MM) EBITDA (in R$MM) 21,8% 50.2% 43.1% 20,4% 24,0 10,8 5,2 2,7 5,4 1,1 3Q07A 3Q08A 3Q07A 3Q08A 3Q07A 3Q08A REVENUES LOSS RATIO EBITDA Strong top line growth powered by Significant improvement in loss ratio Continues EBITDA margin expansion M&A and solid organic growth All figures in this slide take into consideration the acquisitions made in 2007 and consolidated into the Company's financials starting January 1st, 2008 even though they were waiting for approval by ANS. 7
  8. 8. Strong combination between organic and M&A growth Growth Breakdown - Dental Segment Growth by Acquisition Organic Growth 26% 29% 45% 93% 23% Acquisitions 2007 Acquisitions 2008 Organic Growth Growth by Acquisition Organic Growth M&A GROWTH ORGANIC GROWTH Odonto Empresa: 220k Organic growth accelerating retail OralTech: 30k sales channel Fleming: 35k Prevdonto: 130k 8
  9. 9. Assistance Services segment Net Revenue (in R$MM) Loss Ratio - Assistance (%) 53,5% 52,1% 50,4% 49,7% 62,4 50,4% 47,1% 58,8 45,9% 3Q07A 3Q08A Net Revenue 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 2007 2008 REVENUE LOSS RATIO CURVE In 3Q08 the Net Revenues for the Part of this growth refers to the Assistance Segment reached R$ 62,4 increase in the frequency of million, which represents a 6,2 % utilization that the company growth compared to 3Q07. The experienced. growth in net revenue occurred essentially due to the increase in the Additionally, in 2008, USS offered number of covered items, mainly in assistances of greater personal assistance product, which complexity, which consequently has a lower average ticket than USS have a higher average cost average. 9
  10. 10. Assistance Services segment General and Administrative Expenses (in R$MM) EBITDA (in R$MM) 33.0% 25.4% 1,6% 19,4 9,3 9,4 15,9 3Q07A 3Q08A 3Q07A 3Q08A General and Administrative Expenses SG&A and EBITDA Economies of scale and synergies sustaining EBITDA expansion 10
  11. 11. Asset Light Operation Capex (R$ MM) YTD/08 Software 2,9 IT Equipments 2,0 Buildings 0,0 Furniture & Equipment 0,0 Other 1,6 Total 7,3 Capex vs EBITDA (in R$MM) 14% 11% 9% 8% EBITDA 51,1 CAPEX 55,0 37,6 % 30,2 2,5 4,0 5,1 7,3 2005 2006 2007 YTD/08 11
  12. 12. Investors Relations Phone: +55 11 4208-8069 E-mail: ri@tempopar.com.br www.tempopar.com.br/ri