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TALKMED GROUP LIMITED(“TalkMed” or the “Company”)
6th Annual General Meeting25 April 2019
This presentation contains certain financial information and results of operation, and may also contain certainprojections, plans, strategies, and objectives of the Company which are not statements of historical fact but wouldconstitute “forward-looking statements” that reflect the Company’s current views with respect to future eventsand financial performance. These views expressed herein are based on a number of estimates and currentassumptions which are subject to business, economic and political uncertainties and contingencies, as well asvarious risks which are in many cases outside the control of the Company, and which may change over time andmay cause the Company’s future results to be materially different than expected or indicated by such statements.No assurance can be given that future events will occur, that projections will be achieved, or that the Company’sassumptions are correct. Such forward‐looking statements are not guarantees of future performance andaccordingly, the actual results, financial condition, performance or achievements of the Company may differmaterially from those anticipated by the Company in the forward-looking statements. The information containedherein is current only as of its date and shall not, under any circumstances, create any implication that suchinformation is correct as of any time subsequent to the date hereof or that there has been no change in thefinancial condition or affairs of the Company since such date. Opinions expressed herein reflect the judgment ofthe Company as of the date of this presentation and may be subject to change. This presentation may be updatedfrom time to time and there is no undertaking by the Company to post any such amendments or supplements tothis presentation. The Company will not be responsible for any consequences resulting from the use of thispresentation, nor any undue reliance placed upon any opinion or statement contained herein.
Disclaimer
Agenda
Financial performance
Business and corporate update
Summary and outlook
PERFORMANCE REVIEW FOR THE GROUP(1)
For the year ended31 Dec 2018 (“FY2018”)
S$’m
31 Dec 2017 (“FY2017”)
S$’m
% Increase/(decrease)
Revenue 61.28 61.36 (0.1%)
Interest income 0.98 0.76 28.7%
Other income 0.10 0.12 (13.3%)
Operating expenses (27.22) (21.88) 24.4%
Share of loss of associate
(1.14) (1.83) (37.8%)
Profit before tax 34.00 38.53 (11.8%)
Income tax expense (6.79) (7.34) (7.5%)
Profit after tax (“PAT”) 27.21 31.19 (12.8%)
(1) Defined as the Company, its subsidiaries and associate company4
40.0
45.0
50.0
55.0
60.0
65.0
FY2017 FY2018
59.7 (97.2%) 59.9 (97.7%)
1.7 (2.8%) 1.4 (2.3%)
Oncology Services Stem Cell Services
REVENUE BREAKDOWN– FY2018 vs FY2017
S$'m
5
QUARTERLY REVENUE
S$'m
10.0
11.0
12.0
13.0
14.0
15.0
16.0
17.0
18.0
19.0
20.0
Q1FY16
Q2FY16
Q3FY16
Q4FY16
Q1FY17
Q2FY17
Q3FY17
Q4FY17
Q1FY18
Q2FY18
Q3FY18
Q4FY18
Q1FY19
16.0
17.5 17.1
18.4
16.2 15.9
14.0
15.1
12.1
14.1
16.2
19.0
17.0
(1) Defined as the financial year ended 31 Dec 2016
(2) Based on management accounts of the Group
(1) (2)(1) (1) (1)
6
QUARTERLY REVENUE (Cont’d)
S$'m
10.0
11.0
12.0
13.0
14.0
15.0
16.0
17.0
18.0
19.0
20.0
16.0 16.2
12.1
17.0
17.5
15.9
14.1
17.1
14.0
16.2
18.4
15.1
19.0
Q1 FY2016
Q1 FY2017
Q1 FY2018
Q1 FY2019
Q2FY2016
Q2FY2017
Q2FY2018
Q3FY2016
Q3FY2017
Q3FY2018
Q4FY2016
Q4FY2017
Q4FY2018
7
OPERATING EXPENSES FOR THE GROUP
For the year endedFY2018
S$’mFY2017
S$’m% Increase/(decrease)
Employee benefits expense (20.46) (16.16) 26.7%
Cost of share-based payments to employees
(0.54) (0.49) 11.0%
Operating lease expense (1.90) (1.69) 12.5%
Other operating expenses (4.32) (3.54) 21.9%
Total operating expenses (27.22) (21.88) 24.4%
8
OPERATING EXPENSES FOR THE GROUP– By Entities
TalkMed0.99
Singapore Cancer Centre Pte. Ltd.
20.96
Stem Med Pte. Ltd. ("Stem Med")
4.07
CellVec Pte. Ltd. ("CellVec")
0.98
Other subsidiaries0.22
FY2018 (Total: 27.22)(In S$’m)
9
OPERATING EXPENSES– Stem Med & CellVec
Employee Benefits0.57
Operating Lease Expense0.06
Other Operating Expenses0.35
CellVec (Total: 0.98)
Employee Benefits1.20
Operating Lease Expense
0.38
Other Operating Expenses
2.49
Stem Med (Total: 4.07)
FY2018
(In S$’m)
(In S$’m)
10
EMPLOYEE BENEFITS EXPENSE FOR THE GROUP– FY2018 vs FY2017
Higher remuneration of Founding Doctors
1.29
Higher profit-sharing payout to doctors
1.00
Remuneration of newly-hired doctors
0.95
Higher remuneraton of non-doctor employees
0.94
Others0.12
FY2018 vs FY2017: Increase of 4.30 (see below for breakdown)
(1)
(1) Net of decrease in remuneration of doctor who resigned in FY18
(In S$’m)
11
DIVIDENDSS$’m
FY2014 FY2015 FY2016 FY2017 FY2018
30.0 30.0 30.0
28.0
24.0
90%
80%
70%
60%
78.0%80.4% 80.2%
87.4%
83.0%
Amount of Dividend Paid Dividend Paid as a % of PAT
30.0
20.0
10.0
-
12
(1) For the period from 22 September 2014 to 31 December 2015(2) On 9 June 2015, TalkMed entered into a collaboration agreement in relation to the investment in HKH and accordingly, took up the losses in HKH for the period from 9 June to 31 December 2015
S$’m
(30.0)
-
30.0
60.0
FY2015 FY2016 FY2017 FY2018
4.2 (1)
22.1
41.3
54.1
(12.7) (1)(7.1)
(3.0)
0.5
(14.2) (1) (11.9)(6.1)
(3.8)(2.9) (2) (3.6)(1.8) (1.1)
Revenue
Earnings before interest, tax, depreciation and amortisation ("EBITDA")
PAT
TalkMed's share of losses
HONG KONG INTEGRATED ONCOLOGY CENTRE HOLDINGS LIMITED (“HKH”)
13
Agenda
Financial performance
Business and
corporate update
Summary and outlook
BUSINESS AND CORPORATE UPDATES
- Key Developments
Jul He founded the Singapore Sarcoma
Consortium in 2013 and serves as theco-chair for the annual SingaporeSarcoma Symposium.
Dr Quek also founded the AsianSarcoma Consortium (ASC) in 2015and continues to lead the ASC whosemain aims are to develop sarcomaresearch and education across Asia.
Dr Richard Quek joined the Group inJuly 2018 as a Senior Consultant.
Dr Quek was formerly the DeputyHead of the Division of MedicalOncology at National Cancer CentreSingapore and Program Director forMedical Oncology SpecialistTraining, bringing with him over 20years of research and clinicalexperience.
Dr Quek has special interests in themanagement of sarcomas,gastrointestinal stromal tumours,melanomas and lymphomas.
15
Jul
Dr Wong Chiung Ing joined the Groupin July 2018 as a Senior Consultant.
Dr Wong specialises in the diagnosisand treatment of adult cancers with aspecial interest in breast andgynaecological cancers.
Dr Wong was previously involved inclinical and translational research,particularly first-in-human clinicaltrials exploring novel therapies forpatients with cancer and hadpresented and published her work ininternationally renowned high-impact journals.
Dr Wong has received variousawards, including the NationalHealthcare Group ResearcherInvestigator Scientist Enabler Grantand the Excellent Service Gold Awardfrom SPRING Singapore.
She has been invited to present atnumerous public symposiums inSingapore and in the region.
BUSINESS AND CORPORATE UPDATES
- Key Developments (cont’d)
16
CellVec, a 57%-owned subsidiary, wasincorporated on 8 August 2018.
CellVec is a Singapore-based cell andgene therapy manufacturer thatfocuses on the development of a viralvector technology platform.
Subsequent to the incorporation ofCellVec, the cellular and gene therapydivision of Stem Med was transferredand consolidated into CellVec.
More details about CellVec will beprovided in the later part of thispresentation.
The Company’s subsidiary, TalkMedChongqing Pte. Ltd., entered into acollaboration framework agreementwith the People’s Government ofYongchuan District, ChongqingMunicipality, on 28 August 2018.
This was with the intention ofestablishing a Sino-SingaporeInternational Cancer Hospital inChongqing.
Discussions are still ongoing.
Aug
BUSINESS AND CORPORATE UPDATES
- Key Developments (cont’d)
17
Dr Lee Yuh Shan joined the Group asa Senior Consultant in March 2019
Dr Lee specialises in malignanthaematology such as lymphoma,myeloma and haematopoietic stemcells transplant.
His outstanding achievements earnedhim Gold and Star awards in 2013and 2017 respectively, underSingapore Health Quality ServiceAwards.
He is also a member of SingHealthInstitutional Review Board and saton several pharmaceutical advisoryboards.
Regionally, he is active and speaksin many regional haematologysymposiums especially in chroniclymphocytic leukemia andlymphoma.
He contributes to lymphomasupport group and Singapore WorldLymphoma Day.
Mar
BUSINESS AND CORPORATE UPDATES
- Key Developments (cont’d)
18
BUSINESS AND CORPORATE UPDATES
- CellVec’sadvisory team
Prof Farzin FarzenehDirector of Kings College London GMP facility
Role:• Overseeing the building capabilities of the new entity• Validating the Scientific Team• Validating the automation and reprogramming process
Prof Antonio PagliucaHead of Stem Cell Transplantation National Clinical Lead for Regenerative Medicine NHS
Role:• Overseeing the commercial capabilities of the new entity• Validating the role of Strategic Partners• Expanding the client base
19
BUSINESS AND CORPORATE UPDATES
- CellVec’sFacilities
20
BUSINESS AND CORPORATE UPDATES
- CellVec’sFacilities (cont’d)
21
BUSINESS AND CORPORATE UPDATES
- Stem Med’s Facilities
22
Dr Cindy Wong joined HKIOC
(No of oncologists:4)
BUSINESS AND CORPORATE UPDATES- Key milestones of Hong Kong Integrated Oncology Centre (“HKIOC”)(1)
May’15 Jul’15 Aug’15 Aug’16 Feb’17 Aug’17
Dr Cheung Foon Yiu joined HKIOC
(No of oncologist:1)
Grand opening of HKIOC at Citibank
Tower
Dr Peter So joined HKIOC
(No of oncologists:2)
Dr Maverick Tsang joined HKIOC
(No of oncologists:3)
Oct’17
Dec’17Oct’18 Jun’18 Feb’18Apr’19 Dec’18
Collaborated with Hong Kong Adventist
Oncology Centre (“Adventist”)
Commissioning of new linear
accelerator machine at Adventist
Dr Oscar Chan joined HKIOC
(No of oncologists:5)
Dr Stanley Yujoined HKIOC
(No of oncologists:7)
Opening of third clinic in Kowloon
Transfer of HKIOC's endoscopy and day surgery department to
Ramsay Sime Darby
Dr Alan Choy joined HKIOC (No of oncologists:8)
Dr Au Siu Kiejoined HKIOC
(No of oncologists:6)
Dr Philip Kwongjoined HKIOC
(No of oncologists:9)
(1) HKIOC is a 72%-owned subsidiary of our associate company, HKH.23
Agenda
Financial performance
Summary and
outlook
Business and corporate update
SUMMARY AND OUTLOOK
25
While Group revenue declined by some 0.1% mainly due to thedecrease in revenue from stem cell services, revenues for Q4FY18 and Q1 FY19 were very encouraging as they were the best-performing Q4 and Q1 respectively since the inception ofTalkMed.
Our share of loss of associate was some 37.8% lower than FY17.Overall, Group PAT declined by some 12.8% largely due to higheroperating expenses.
The Company has proposed a final dividend of S$0.01065 pershare. Together with the interim dividend of S$0.00761 per sharethat was paid in August 2018, this will constitute 83.0% of thenet profits attributable to owners of the Company in FY18.
SUMMARY AND OUTLOOK
(CONT’D)
26
We are encouraged by the global proliferation in uses ofmesenchymal stem cells for regenerative medicine and thisoffers great potential for Stem Med. However, the industry is stillheavily regulated and such potential can only translate intopositive contributions to the Group’s bottom line if the relevantregulations in Singapore are relaxed.
CellVec’s GMP facility is currently undergoing a process ofqualification. We look forward to obtaining the requisitecertification and thereafter for the production of GMP productsto commence by the end of Q2 FY19.
In 2019, the Company will continue to explore M&Aopportunities and/or new collaborations.
Thank you
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