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Investor PresentationQ4 2017
The material in this presentation has been prepared by Strategic Allied Health Pty Ltd (“SAH”) and is general background information about SAH’s
activities current as at the date of this presentation.
This information is given in summary form and does not purport to be complete. Information in this presentation, including forecast financial
information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling
securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or
needs. Before acting on any information you should consider the appropriateness of the information having regard to these matters, any relevant
offer document and in particular, you should seek independent financial advice. All securities and financial product or instrument transactions
involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments and, in international
transactions, currency risk.
This presentation may contain forward looking statements including statements regarding our intent, belief or current expectations with respect to
SAH’s businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk
management practices. Readers are cautioned not to place undue reliance on these forward looking statements. SAH does not undertake any
obligation to publicly release the result of any revisions to these forward looking statements to reflect events or circumstances after the date hereof
to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary
in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside SAH’s
control. Past performance is not a reliable indication of future performance.
2
Disclaimer
Page 2
Contents
Page 3
Executive Summary 4 High Growth Markets 12
Key Investment Considerations 5 Multiple Organic Growth Drivers 13
What we do 6 Highly Experienced CEO 14
Our Vision 7 Market case studies – NVL 15
Acquisition Strategy 8 Board and Management 17
Value Adding Strategies 9 Indicative Listing Timetable 18
Strong revenue growth outlook 11 APPENDIX - Value-adding strategies 19
- Practice Case study 25
Executive Summary
Page 4
SAH is a national Multi-modality Health Practice business model.
Experienced CEO
with strong track
record
• CEO is Dr Jason McMillan - qualified chiropractor with 20+ years operational experience.
• Strong track record managing his own multi-chain network McMillan Chiropractic Centre.
• Extensive operational value-add track record as a sector consultant through his consultancy Abundant Practice Development
and Consulting (APDC); involved in greenfield and brownfield development, M & A, and new business models.
Value-adding
business model
• Acquire allied health practices already operating on a multi-practitioner and multi-modality basis and further develop each.
• Apply the proven value-adding strategies of Abundant Practice Development and Consulting.
• Some greenfield and brownfield redevelopment strategies are employed.
Multi-disciplinary
model
• Discipline mix optimisation is based on APDC proprietary experience and site specific analysis.
• Options include Chiropractors, Osteopaths, Physiotherapists, Psychologists, Sports Medicine, General Medicine,
Dieticians/Nutritionists, Exercise Physiologists, Myotherapists, Acupuncturists, Traditional Chinese Medicine and Naturopathy.
Proven private
equity process
• Project sponsors Strategic Equity Alliance (SEA) are applying their proven value-adding process (having successfully created
and taken to IPO both Greencross and National Vets, with P2P transport due to IPO on 13 Dec 2017).
• At this stage, some additional seed funding for initial integration, advisory fees and IT systems rollout is welcome.
• Seed investors can participate on highly attractive terms (3x uplift on seed capital into IPO stock).
• Seed investors will also have preferential IPO allocations (assuming an oversubscribed IPO).
Attractive return
profile
Key Investment Considerations
Page 5
High Growth: Strong Allied Health Sector Growth Outlook1
Valuation: Attractive Relative Valuation2
High Return: Significant investment return for seed investors (3x capital into IPO stock)3
Proven Processes: Operational value-add – proprietary Abundant Practice Development & Consulting processes.
Private equity process - Strategic Equity Alliance track record (Greencross, National Vets, P2P)
4
Highly Profitable: Profitable business portfolio underpins high and growing dividend outlook. The Initial Group
generates ~A$62.39M revenue and A$13.08M practice EBITDA
5
Strong Management: CEO is Dr. Jason McMillan, with over 20 years experience in the development of multi-
practitioner and multi-modality allied health centres and adding value through multiple strategies.7
6 Capital Flexibility: Strong balance sheet to provide growth capital for further acquisitions
8 Cultural Alignment: Cultural alignment through base acquisitions comprising CEO’s personal and client
networks.
9Fragmented Sector: Fragmented allied health sector provides significant consolidation potential. Minimal
presence of corporatisation models and few multi practice owners.
What we do
Page 6
Locations 93
Vendors 47
Revenue $62.39m
Practice EBITDA $13.08m
Group EBIT post overheads $8.73M
Initial Portfolio
93
• Strategic Allied Health (“SAH”) was founded by Strategic Equity Alliance (“SEA”), a corporate investment firm with a strong track
record in value creation. SEA founded and listed successful aggregations Greencross (ASX:GXL) and National Veterinary Care
(ASX:NVL), with P2P Transport (ASX: P2P) due to IPO on 13 December 2017.
• Acquisition targets are selected through strict proprietary parameters which SAH has historically identified as presenting value-add
potential.
• Two stage acquisition process:
• Stage 1 pre-IPO acquisitions. Agreements to acquire 93 practices from 47 Vendors (“Initial Group”) across Australia. IPO will
seek to raise ~A$47.15 million to fund acquisitions.
• Stage 2 post-IPO acquisitions. Will focus on predominately Australian assets with potential expansion into New Zealand and
Asia.
• The Initial Group generates ~A$62.39M revenue and A$13.08M practice EBITDA. APDC value-add strategies are expected to
increase the EBITDA.
Our Vision
Page 7
Multi-disciplinary Allied Health Practices with a “hub and spoke” operational model
Proven business
model
• APDC has proven the “hub and spoke” model of smaller “regular” practices referring in to larger “flagship” practices
for specialist services.
• APDC experience shows multi-practitioner, multi-modality health practices are significantly more profitable than
single modality.
Regular practice
model
• Regular practices have at least 4 allied health disciplines and operate according to a health optimisation strategy (as
opposed to pain/crisis management).
• Vendor profile is 40-50 years old, 10-15 years of remaining work life and motivation to deliver future growth through
SAH processes.
Flagship practice
model
• Flagship practices have more floor space and allied health disciplines, eg. South Yarra Spine and Sports Medicine
(SYSSM).
• 3-4 flagship practices will be developed in each capital city.
Multiple flagship
development
strategies
• Acquisitions (eg. SYSSM).
• Brownfield - moving/redeveloping an established practice into a larger format.
• Greenfield.
Patient-centric,
health management
plans create annuity-
like revenues
• Focus is on health management and preventative care, not reactive pain management.
• SAH provide Health Management Plans which provide ongoing health management and maintenance strategies, which
develops an ongoing relationship with SAH providers and generates repeat revenues.
Acquisition Strategy
Page 8
Disciplined acquisitions within defined parameters and value-add strategies
Focused hub and
spoke operational
model
• Flagship practices – SYSSM has 25 practitioners representing 13 different health modalities (some of which are specialist
services).
• Regular practices – can refer to flagship practices for the services not available in their location. Patient files can be
transferred, practitioner communication, payments and booking can be handled from either location through Visual Outcomes
(practice management software).
Cultural alignment
• Several acquired businesses have been clients of APDC previously, promoting cultural alignment into the consolidated
group.
• Vendors are motivated by the philosophy of optimising full lifecycle health and wellbeing and improving Australian health
outcomes.
Proprietary data
forms basis of
suburb selection
• Practices are mostly within a 200km radius of capital cities.
• Brisbane, Sydney, Melbourne represent the largest distribution of practices.
Specific practice
selection based
on value-adding
experience
• Minimum profitability and EBIT margin hurdles.
• Multi practitioner (3+ in primary modality) and multi modality (3-4 modalities).
• Vendor age profile, motivation and commitment to adopt new systems and procedures.
• Vendor engagement period of 3 year minimum service agreement.
• Vendor equity 30% escrow for 2 years with clawback provision.
Value-adding strategies
Page 9
CEO track record applying multiple value-adding strategies across multiple allied health disciplines
Hub and spoke
operational
model
• Proven value-adding operational structure allows cross-referral, bulk buying, rostering optimisation and floor space returns.
• Flagship practices will either be acquired (SYSSM), developed by moving/expanding an established practice into larger
premises or developed as “greenfield” practices.
Centralised
reporting
• Integrated practice management software (PMS) across the group of practices to provide real time reporting capabilities at
practice, region and group level.
• PMS and Enterprise Resource Planning (ERP) software will both be installed and tested pre IPO.
Practice
level KPIs
• KPI’s linked to training, systems and procedures.
• Developed by APDC and proven to achieve significant improvement in patient retention and practice growth.
• Proprietary KPI’s are much deeper than “standard” measurements like patient numbers and revenue, with track record of
improved retention and future growth/development.
Best practice
benchmarking
• Clinical Governance and Service Delivery KPI benchmarks established through APDC’s extensive experience.
• PMS allows for individual practice to be benchmarked against its own KPIs, other practices and the Group.
Proven growth
strategies
• Proven systems and procedures to drive outcomes and deliver significant practice growth.
• For example, improved retention and service utilisation “in house” can deliver significant growth.
• Installation of a sophisticated PMS allows monitoring of innovative performance metrics.
Value-adding strategies
Page 10
CEO has extensive track record applying multiple value-adding strategies across multiple allied
health disciplines
Revenue
cross-sell
initiatives
• The concept of smaller practices referring in to flagship practices for specialist services has been tested and proven to be
successful.
• Ability for practitioners to identify and refer for other health services within each practice has been tested and proven to be
successful.
Cost-out initiatives
• Centralised purchasing.
• Rostering.
• Marketing.
• Accounting/book keeping.
• Payroll administration.
Local and regional
management
structure
• Allows best practice benchmarking and best practice dissemination.
• Proven model.
• Economies of scale.
• Vendor/Principal accountability and management support at Regional Level.
• Multi level management review of KPI’s and multi level management accountability of practitioner, practice, region and
group performance.
Staff incentives • Profit Share Agreement incentivising both practice growth and network expansion
Strong revenue growth outlook
Page 11
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
SAH forecasts growth of revenues from $62.39 million in 2018 to $104.79
million in 2020. SAH believes that the potential for growth is significantly above
the 5% reflected in financial modelling. This opinion is based on the case
studies provided by APDC to SAH of practices that have been redeveloped by
APDC in recent years. Redevelopment of these practices involved the same
concepts and resources being applied by SAH.
Strategic Business acquisitions to continue post IPO
Strong Organic revenue growth expected driven by:
FY18 &19 earnings outlook
Diversification strategy focusing on multi modality clinics
SAH’s initial group comprises of practices that already fit the model of multi
practitioner and multi modality. Thus, the SAH post IPO focus will be to
enhance these market leading practices rather than having to make wholesale
changes to single discipline practices.
Implementation of a strict set of KPI’s and practice management software
system. A focus in each practice on the addition of more service providers and
broader range of services. Floor space optimisation and product sales.
SAH will continue to acquire practices which meet strict criteria to ensure
minimal integration risk and compatibility with the initial group. SAH expects to
grow its portfolio from 93 initial practices to ~129 in by 2019
$62.39m
$68.51m
$104.79m
$9.34m $11.32m
$18.96m
2018 2019 2020
Forecast Revenue and Group EBITDA Growth
Revenue Group EBITDA
Note: Group EBITDA is calculated following deduction of head office
overhead from practice EBITDA, which is approximately 6% of revenue.
High Growth Markets
Page 12
Physiotherapy Industry Revenue Growth %
Change
73.581.1
86.794.9
103.6114.4
121.7131.6
142.0147.0
154.6
FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Australian Healthcare Expenditure
2.52.8
33.3 3.4 3.4
3.7
4.44.8
5.25.4
FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Australian Allied Healthcare Expenditure
Both total health care spending and the allied health care proportion are expected to increase
Total Australian healthcare spending is growing
• CAGR of 7.3% from 2004 to 2014, with 8.73% growth from 2014 to 2016 to $168.1bn.
• Key growth drivers are ageing population and increased private health insurance coverage.
Allied healthcare spending is increasing as a proportion of total healthcare spending
• CAGR of 7.0% from 2004 to 2014 and 15.8% growth from 2014 to 2016 to $6.2 bn.
• Allied Healthcare is classified as “other healthcare services”, accounting for approximately 14.5% of overall health care market.
Source: Australian Institute of Health and Welfare
Multiple organic growth drivers
Page 13
Physiotherapy Industry Revenue Growth %
Change
The allied health sector benefits from multiple tailwinds driving a strong growth outlook
Ageing population
• As the proportion of age demographics increases, the demand for integrated allied health services will further
increase.
• More than half of Australia’s healthcare expenditure is incurred on patients 65+ years.
• The proportion of the Australian population aged 65+ years is estimated to increase from 15% in 2016 to 22.6% in
2055.
Sports
participation
• As sport participation increases, the number of injuries requiring allied health professional treatment may grow.
• The level of sports participation was expected to rise in 2016-17.
Health insurance
demand
• Allied Health Services are covered under private health insurance extras cover in Australia.
• 55.6% of Australians have both hospital and ancillary private health insurance, with an outlook for strong growth.
NDIS rollout
• All practices within the SAH business model will be able to register as NDIS service providers.
• SAH will become a national network of allied health providers capable of servicing NDIS clients.
Highly experienced CEO
Page 14
Physiotherapy Industry Revenue Growth %
Change
CEO has extensive multi-site, multi-disciplinary operational and value-adding experience
CEO
• CEO is Dr Jason McMillan (B.App.Sc; (Clin. Sc); B.Chiro.Sc)
• Qualified chiropractor with 20+ years operational experience in private practice and extensive experience in consulting to
health practices through Abundant Practice Development and Consulting
Multi-network
experience
• Strong track record developing, managing his own multi practice network McMillan Chiropractic Centre.
• Business model and associated IP developed and tested over 20 years
• Involved in establishing and expanding multi practice networks in various health modalities for clients through APDC
Multi-disciplinary
model
• Has operated multi-disciplinary model including 14 Chiropractors, Myotherapists, Massage Therapists, Psychologists,
Podiatrists, Acupuncturists, Traditional Chinese Medicine, Counselors, Naturopaths for 20 years at MCC
• Established larger scale multi-disciplinary practices through APDC such as South Yarra Spine and Sports Medicine
• Established a national network of Occupational Therapists through APDC
Proven value-
adding strategies
• Extensive operational value-add track record as a sector consultant through his consultancy Abundant Practice Development
and Consulting
• Involved in greenfield and brownfield development, M & A, and new business model development
• Personal and client networks present a strong acquisition pipeline
• Cultural alignment often a result of prior CEO/client relationships and APDC strategy deployment
Extensive
network
Market case study: National Veterinary Care (ASX:NVL)
Page 15
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
• National Veterinary Care (ASX:NVL) listed on 9 July 2015. Similar to SAH, NVL is an acquisition and value-add business model.
• Between 2015 and 2017, NVL made 9 acquisitions totaling ~$29.54 m.
• NVL’s share price increased from $1 IPO issue price to high of A$2.68 and current share price $2.63 (as at 25 Nov 2017).
Strategic Equity Alliance developed and listed National Veterinary Care. Post-IPO, equity capital markets have
continued to support the acquisition model and the share price has outperformed.
NVL share price performance & acquisition history
Comparing National Veterinary Care and Strategic Allied Health
Page 16
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
Acquisitions since IPO
Acquisition Target
Acquisition
Price
Percentage
Stake
Transaction
Date of Close
Fitzroy Veterinary Clinic &
Animal Hospital Pty Ltd $2.83m AUD 51% 7-Sep-15
Whites Hill Vet $0.87m AUD 100% 8-Oct-15
3 Clinics (Undisc.) $1.54m USD 100% 18-May-16
Complete Vet Systems $0.82m AUD 100% 26-Apr-16
Vet Clinic NSW $1.20m AUD 100% 17-Jun-16
UVG Aust Pty Ltd $5.93m AUD 100% 8-Julr-16
7 Clinics New Zealand
(Undisc.) $8.33m NZD 100% 26-Aug-16
4 Clinics Australia (Undisc.) $4.00m AUD 100% 30-Apr-17
4 Clinics New Zealand
(Undisc.) $3.48m NZD 100% 30-Apr-17
1 Clinc New Zealand
(Undisc.) $1.00m NZD 100% 8-May-17
2016 Financial Results
2017 Financial Results
SAH vs NVL comparison• Valuation. NVL is trading on 20.6x PE and 9.5x EV/EBITDA multiples, which could be indicative pricing benchmarks for SAH IPO.
• Higher EBIT. SAH $13.08m EBITDA at IPO is larger than NVL currently.
• Value-add record. SAH will leverage the extensive value-add track record of APDC.
Compared to NVL, SAH comes to market with higher EBIT and a value-add track record.
Board of Directors / Key Management
Page 17
CHAIRMAN
Glenn is a business aggregation expert with
more than 25 years’ experience in
establishing medium to large-scale
consolidated businesses, most recently with
Strategic Equity Alliance. Glenn founded the
company which oversaw the negotiation and
acquisition of select businesses to form a
consolidated group of veterinary practices
which listed on the ASX as Greencross Ltd
where he served as a founding director for 18
months’ post IPO as well as Chairman of the
Audit Committee during his tenure.
Additionally, Glenn was a founding director of
National Veterinary Care Ltd, which also
listed on the ASX in 2015, acquiring and
consolidating a group of veterinary practices
throughout Australia. Glenn is a member of
the Australian Institute of Company Directors
Glenn Gaudet
CHIEF EXECUTIVE OFFICER
Jason's passion for natural health, wellbeing and
optimal performance has seen him grow a market
leading group of allied health practices in Victoria.
Having built this business from the ground up, he
has over 20 years’ experience in balancing
clinical excellence with the development of both
management and clinical personnel and the
establishment of market leading systems,
procedures and performance metrics.
Jason moved from clinical practice to a consulting
role with the establishment of Abundant Practice
Development and Consulting (APDC) in 2014.
APDC has delivered extremely successful results
to clients both financially and clinically and has
been integral in the establishment of many very
successful practices across the country.
Jason holds a Bachelor in Applied Science
(Clinical Science) and Bachelor of Chiropractic
Science.
Dr. Jason McMillan
CHIEF F INANCIAL OFFICER
Rowen is a Chartered Accountant with over 25
years of successful senior financial management
experience in various global industries.
Rowen was formerly Chief Financial Officer of
ASX listed lithium company Galaxy Resources
(ASX:GXY) including during its merger with
General Mining. In addition Rowen also acted as
Chief Financial Officer of Forsys Metals Corp, a
TSX listed uranium developer and also Chief
Financial Officer of Caravel Minerals Limited an
ASX listed gold and base metals explorer.
Rowen was formerly a Development Director for
a major sovereign wealth fund in the Middle East
managing multiple global development projects.
Rowen Colman
Indicative listing timetable
Page 18
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
Key milestones
Establishment / Key IPO Framework
Discovery Stage November 2017 December 2017 January 2018 February 2018 March 2018
Set Materiality
ThresholdsInitial Establishment
Sourcing initial vendor group
Sourcing c-suite executives
and key personnel for group
Early consultations with ASIC
and ASX
Formulate group policies
(accounting) and
implementation of group
software platforms
Listed remuneration
structure considerations
finalised
Appointment of key advisors
Acquisition due diligence
identifying potential
normalisation adjustments
Formulation of pro-forma
group financial data
supporting investment thesis
Initial pro-
forma
group
identified
Vendor
initial RFI
Business
strategy
formulated
Finalise pro forma adjustments
Preparation of Key Financial
InformationPrepare prospectus
ASIC
Exposure
Period
Finalise FY18 & 19 BudgetsReconfirm FY18 for trading and other
factors
Develop basis for forecast assumptions –
clear organic growth considerations
Complete tax due diligence
Complete financial due diligence
Drafting of financial information section for prospectus
Completion of integration strategy and risk mitigation
Prospectus drafts comments and revision
Attend DDC meetings and provide regular updates and revised
information to DDCFinalise Audit procedures
April 2018
Prepare full P&L bridges
Prepare wrapComment on
144A wrap
ASX listing
application
Marketing and offer
period
DDC
formed
Finalise
pro forma
financial
information
Present
financial
information
report to
DDC
Lodge draft
prospectus
with ASIC
Lodge
final
prospectu
s
Lodge
listing
application
with ASX Listed
Completion/
Execution of
Business Sale
Agreements
Execution of vendor
BSA’s
APPENDIX: Multiple value adding strategies
Page 19
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
Value-adding strategies are based on the proven methods of CEO and Abundant Practice Development &
Consulting
1 Multiple value-adding strategies
Practice Level Group Level
Management efficiency
• Improved business analytics
• Improved management resources
Sales & marketing
• Improved market presence
Expanded offering
• Addition of more service providers and more
services in each location
• Improved property management
• New product sales
Cost-out
• Volume buying discounts and efficiencies
Mergers & Acquisitions
• Acquisition and merger into existing practices
Development
• Greenfield development of new flagship
practices
• Brownfield redevelopments
New segments
• Expansion into new markets (corporate and
insurance health)
New geographies
• Expansion into international markets
Multiple value-adding strategies are applied at Practice and Group Level.
Value adding strategies: IT and operations
Page 20
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
2 Portfolio Integration
IT management and accounting systems
• SAH will invest ~$1m in IT systems pre-IPO to enable effective monitoring and management of KPIs.
• An extensive review of potential IT providers was conducted. SAH performed an extensive review of 11 different practice
management software programs. Visual Outcomes was a clear market leader and the only system capable of providing all
resources required by SAH. VO will integrate with SAH accounting IT provider and thus enable full reporting transparency from
practice level through to head office accounting immediately post-IPO.
• Visual Outcomes practice management software system is being rolled out into each business. APDC and CEO Dr Jason
McMillan have worked with Visual Outcomes over many years – both in his own network McMillan Chiropractic Centre and for
consulting clients.
• Levit8 IT system hardware provider and maintenance service will run an audit over each practice’s current hardware system,
design an appropriate system for each practice, manage the upgrade/installation of hardware in each location and
manage/maintain the system centrally.
• Acquired practices are being integrated onto Visual Outcomes from December until IPO at a rate of 2-3 per week (where a vendor
has a number of practices, this is considered as 1 installation).
Proven “hub and spoke” operational model
• Proven model. SAH will operate on a “hub and spoke” arrangement based around regular practices and flagship practices.
Through APDC, the concept of smaller practices referring in to flagship practices for specialist services has been tested and
proven to be successful.
• Regular practices will be multi practitioner and multi modality and have at least 4 complementary health modalities within the
blend of services available.
• flagshipe practices will be larger scale practices with more floor space, more health modalities and other services available (eg.
South Yarra Spine and Sports Medicine). Flagship practices will either be acquired (SYSSM), developed by moving/expanding an
established practice into larger premises or greenfield developments.
Value adding strategies: Management and bolt on acquisitions
Page 21
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
2 Portfolio Integration
Proven tiered management model
• Management will involve a tiered structure of Local Management Team, Regional Managers and Executive Management. The
management model adopted by SAH has been tested in practice by APDC over many years and refined for SAH.
• Vendors will have an earn out period and minimum 3-year service agreement. Vendors will be paid under a Facilities Service
Agreement at a rate commensurate with industry standards (eg. chiropractic 45% of gross revenue generated;
osteopathy/physiotherapy 50%).
• The Vendor and/or Practice Manager (ie. they may or may not be more than one person) will form a Local Management Team
which will be incentivised to further grow the practice EBIT.
• The Local Management Team will report to a Regional Manager.
• Regional Managers will be salaried management staff who will oversee 15-20 practices in a geographical region. These staff will
be responsible for the performance metrics of each practice/practitioner within their group. Regional Managers will be incentivised
for the growth and performance of their region.
• Regional managers will report to Executive Management (Chief Operating Officer and/or CEO).
Bolt-on acquisitions provide significant value add potential
• There is tremendous scope for SAH practices to acquire smaller independent practices in the immediate geographical vicinity of
SAH locations.
• Acquiring such practices can be done at very low prices (2-3x EBIT). These practices can be easily merged into existing SAH
practices with excellent retention of patients/turnover.
• By doing so, there is opportunity to significantly improve revenue and profit for very little capital outlay, with each acquisition or
merger resulting in little or no increase in practice overheads except for the remuneration of the practitioner under a FSA at 45-
50% of revenue generated.
• Each acquisition and merger can potentially add up to 55% of turnover as profit.
Value adding strategies: Holistic health care model
Page 22
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change
3 Health Model
Health management, not pain management
• SAH’s focus is proactive health management and preventative care, not pain management (ie. have pain, treat it and come back
when pain recurs). Pain management is not health management.
• The model is proactive and patient centric. Patients will enter the business for the first time because of:
• Symptomatic presentation – a health complaint, which could be pain, poor function/movement, improved athletic/sports
performance, strength and conditioning advice, weight and associated issues, stress/lifestyle management.
• A desire just to be healthier – to optimise their health/wellbeing/performance.
• Because their trusted friends, family, advisors told them to attend.
• For prevention.
Health management plans drive repeat revenues
• The Health Management Plan (HMP) provides patients with an ongoing health improvement and maintenance program
which develops a relationship with SAH service providers and creates an annuity revenue profile.
• Health Management Plans are provided to patients following assessment by SAH practitioners and include the following:
• Address primary presenting complaint.
• Provide an understanding of what other health related risk factors or issues may be present.
• Provide options for addressing all aspects of the patient’s presentation.
• To address various aspects of a patient’s health/wellbeing, patients can be serviced either “in house” or within the SAH practice
network.
• With the patient as the centre of the health model (patient centric) and a 4 pillars approach to practice, SAH believe that their
practices can have a significant impact on the patient’s future health potential.
Value adding strategies: Data driven decision making
Page 23
Physiotherapy Industry Revenue Growth %
ChangeChiropractic Industry Revenue Growth %
Change4 Data Analytics
Proven data-driven decision making and management models
• CEO has a range of well-established KPIs, management reporting systems, management systems and
procedures to optimise business performance. These have been proven to significantly improve earnings
across a range of business models - multi practitioner, multi modality, multi site etc.
• Data analytics. Traditionally, health practices (particularly in these fields) have poor patient trend and statistical
analysis metrics. They have grown and developed through word of mouth referrals and quality service/patient
outcomes. APDC experience has shown that by applying business analytics and management resources to
these businesses, exceptional growth can be achieved.
• Performance Monitoring, Benchmarking and Performance Improvement. Each practice will be
benchmarked for each practitioner, practice and the group against data provided by APDC. SAH will then use
APDC proven systems, procedures and training to improve these KPI’s. Practitioners, Local Management
Teams and Regional Managers will all be educated in the relevance of KPI’s, and weekly reporting of each
practitioner/practice against benchmarks will be implemented. Training will be applied where necessary to
improve performance in each area.
• By monitoring all of the above and applying appropriate systems, procedures and training to achieve optimal
performance in each, dramatic and sustainable improvement in patient volume can be achieved.
• Examples of some proprietary KPIs are on the next page.
South Yarra Sports Medicine
APPENDIX - Practice case study
Page 24
• In 2014, Dr Luke Nichols had the vision of establishing Australia’s
market leading, fully integrated, allied health practice.
• Luke engaged Dr Jason McMillan and Abundant Practice
Development and Consulting to enable this vision to become a
reality.
• APDC were involved in developing the business plan, scope of the
business and financial modelling. They identified and assisted in
securing an appropriate site for the business, designed the layout of
the practice and provided access to all IT and IP required to
successfully run a practice of this nature. APDC were involved in the
recruitment and training of staff, practitioners, advised on blend of
services and associated resources/programs that could complement
the practice.
• SYSSM opened to the public in early 2015 and has created a
premium health brand and practice that is recognised for its integrity
and quality of service. It is recognised by the general public, elite
athletes, the business community, health/fitness and high
performance coaches and advisors.
• SYSSM is the preferred referral clinic from respected GP’s,
Orthopaedic Surgeons and allied health practitioner (including the
entire client network of ADPC).
• Month on month for 30 months SYSSM has experienced growth, with
a constant average of 20 new patients per week (100 new patients
per month).
• SYSSM has established a patient base of over 3500 patients in 30
months. This will double within the next 2 years.
0
500
1000
1500
2000
2500
3000
3500
Quarter
Wk Av
Expon.(Quarter )
Quarterly Growth (Core Group Only)
Gross total monthly income (Core Group Only)
South Yarra Sports Medicine
Practice case study
Page 25
• Designed with the patient at the centre, an inspiring modern fit out full
of natural light.
• A unique facility – currently consisting of nine treatment rooms (soon
to be expanded to 11), gym, multipurpose Pilates, 3D room and
seminar room.
CORESERVICES
CHIROPRACTIC
PHYSIOTHERAPY
EXERCISE PHYSIOLOLGY
DIETITIAN
NATUROPATH
SPORTS ACUPUNCTURE
Biomechanist
3D Motion
Non Core
MASSAGE
PODIATORY
Alter G
Inlign
Osteopathy
Optimise Sports
Chiropractic
Rental
Melbourne
Sports Physicians
Personal Trainners
Custom Fit Careers
Holisitc
Psychology
Satellite Practices
(Core)
Nicholson
SSM
Prahran
SSM
Emporium
SSM
13 professions represented
25 Practitioners in total
Core Services Contractors on percentage of turnover
Non-Core Rent plus Service Fee (percentage of turnover)
Rental Rent only
Satellite Contractors on percentage of turnover (Core)
The Facility and Business Structure
For further information regarding direct investment in
Strategic Allied Health please contact us below:
Level 12, 10 Market Street
Brisbane, QLD, 4000
www.strategicea.com.au
