São Paulo, July 29th, 2021 - Grupo Fleury announces today its second quarter 2021 (2Q21) results. All figures are compared to the same period of the previous year, unless otherwise stated, and are rounded to the nearest thousand. However, there may be differences when compared to the financial statements due to decimal digits.
Gross Revenue reached a new historical record in the quarter, totaling R$ 1.005 billion, growth of 104.2% compared to 2Q20 and 4.2% compared to 1Q21. o Client's home service registered a strong growth for the fifth consecutive quarter, with gains of
40.4% in the quarter, representing 8.1% of Gross Revenue, the highest historical level. o Resumption of imaging tests, which recorded an increase of 179.5% compared to 2Q20 and 9.7% compared to 1Q21. o 545 thousand tests were performed for Covid-19¹ in the quarter, being 306 thousand RT-PCR and 239 thousand serologies. Gross revenue from Covid-19 tests represented 8.3% of total revenue in the quarter, the lowest level recorded since the beginning of the pandemic.
Strengthening of the Ecosystem strategy, with revenue growth from services beyond diagnostics, representing 4.1% of Gross Revenue. o Saúde iD: Continuous growth in the number of lives and expansion of Telemedicine services, with more than 228 thousand medical consultations performed in 2Q21, totaling more than 570 thousand medical consultations performed since the beginning of the offer of this service.
New initiatives: Consolidation of the acquisitions of Centro de Infusões Pacaembu and Clínica de Olhos Moacir Cunha, in addition to the closing of the acquisition of Clínica Vita of orthopedics.
Recurring EBITDA of R$ 249.1 million (+1170%), with a recurring margin of 26.7% in 2Q21. In the year, R$ 534.7 million (+148%) with a recurring margin of 29.3%.
Recurring Net Income of R$ 86.6 million (+218%) with a recurring net margin of 9.3% in 2Q21. In the year, R$ 205.2 million (+1507%) with a recurring net margin of 11.2%.
Operating Cash Generation of R$ 286.5 million (+316.1%) in 2Q21, and in the year R$ 485.7 million (+143.2%).
Return on Invested Capital (ROIC2) without goodwill, considering the effects of IFRS-16 of 58.7% in the quarter.
The NPS3 of the Group reached 76.1% and 84.4% in client's home service in 2Q21, as a result of the continuous efforts to improve the level of services in our PSCs.
In July/21 was announced the distribution of interest on capital in the amount of R$ 42.3 million, equivalent to R$ 0.13 per share.
Tests performed between 04/01/2021 and 06/30/2021, including RT-PCR and Serology | ² As of 1Q21, we present the ROIC with the effects of IFRS-16 | 3 Net Promoter Score
Main Financial Indicators
An ecosystem of integrated, preventive and hybrid healthcare
In the recent months we have repeated that we have entered a new cycle of growth, which reflects our strategic positioning of being an integrated, preventive and hybrid healthcare ecosystem, combining physical and digital offerings. The second quarter of 2021 is the proof that this is not just a speech. Grupo Fleury reached a new historical record of revenue in the period, reaching 1.005 billion reais, an increase of more than 104% compared to the same period of last year. The figure is already beginning to reflect the expansion to new links in the chain, which in 2Q21 accounted for 4.1% of the Group's revenues and included, for example, revenues from the acquisitions of Clínica de Olhos Moacir Cunha and the Centro de Infusões Pacaembu (CIP). Although we experienced a second wave of the pandemic in the country, the share of Covid-19 tests in the Company's total revenue reached the lowest rate since last year: 8.3%. At the same time, we continued with an increasingly strong recovery in the volume of routine tests, with revenue from client's home service increasing its share, reaching 8.1% of the group's total revenue.
Strengthening our platform strategy, the number of lives coming from Saúde iD remains growing. Since the service was inaugurated, at the beginning of the Covid-19 pandemic, nearly 600 thousand medical teleconsultations have been performed, which positions the healthtech Saúde iD as one of the leaders of this service in the country.
In addition, the marketplace began to offer surgeries - an addressable market of 1.9 billion reais. With this, the Group materializes its "asset-light" platform model: even without investing in hospitals, it can offer beds in partners institutions.
These movements make the Company the best example of integrated healthcare, in fact capable of accompanying the patient throughout their journey of care, acting in prevention, primary care, diagnostics, secondary and tertiary care, offering all necessary services and increasing the life time value. With telemedicine services, check-up, clinical consultations, diagnostic tests, treatments in various medical specialties (ophthalmology, orthopedics and infusions of immunobiological drugs, for example), and now surgeries, the Group becomes a concrete, powerful and highly scalable - something that the entire healthcare market needs, but in practice the patient was not able to find it yet.
As in a puzzle, first we had the "loose" pieces. Now that they start to fit together, the value created for clients, physicians, partner hospitals, HMOs, shareholders and the entire healthcare system is evident. Over the years, we have built a relationship of trust with our clients and physicians, with strong and recognized brands, and now we associate digital and physical services, offering healthcare in a hybrid way. This powerful combination has the firm purpose of promoting better healthcare, in a preventive way, and of being with the patient when they need specific care, following their needs in an integrated way. Grupo Fleury is, increasingly, a complete healthcare company, multichannel and that every quarter opens new avenues of growth.
Saúde iD, 25 million potential customers
When it was created, in September 2020, Saúde iD had a base of 7 million potential customers, coming from HMOs and companies that contracted the services and benefited from the marketplace. Of the total of 1.1 million lives served in the quarter, 14.5% came from Saúde iD, an increase of 27.9% over the previous quarter. If we analyze only teleconsultations (all performed by physicians and other healthcare professionals and not by chatbots), the growth was 21.9% compared to 1Q21, totaling 228,5 thousand consultations. This B2B2C strategy was the embryo of a more ambitious initiative, which is now beginning to be implemented: the sale of services directly to the consumer. The
renewed management of Saúde iD, which has professionals with extensive platform knowledge and a focus on the user experience, has given us the ability to rapidly expand our product portfolio and potential partnerships.
Saúde iD was created to reinvent access to healthcare in Brazil. This year, we started to offer subscription services involving telemedicine care, physical consultations and a test packages, directly to the consumer. More recently, we implemented an all-inclusive surgery service accessible to people who do not have health insurance. The list of initial surgeries includes procedures of low surgical complexity, high cost predictability and a care cycle shorter than 30 days. The remuneration model is by outcome, this means that all costs are included. With this business model, we created an offer of beds without directly having the hospital assets. More than that, we are offering patients the possibility of undergoing the surgical procedure without having to wait months or even years, with a potential market of 1.9 billion reais.
An example of the scalability potential of Saúde iD is the recent announced partnership with Smiles, the company that manages Gol's frequent flyer program. As of the last quarter of 2021, Smiles' 18 million clients will be able to start exchanging their miles for services from our marketplace, such as telemedicine consultations and diagnostic tests. As a result, the potential Saúde iD customer base more than triples, reaching 25 million lives. As new products are incorporated into the platform, they will also be available to these clients.
Growth in diagnostics and new healthcare links
As a 95-year-old company recognized for quality and excellence in diagnostics, we have many opportunities for growth in new places where we do not operate yet. Therefore, in this quarter, we acquired two traditional diagnostics brands in Espírito Santo: Bioclínico and Pretti labs. The initiative, in addition to marking Grupo Fleury's entry into the Espírito Santo market, reinforces our national capillarity and further complements our offer in the Southeast region of the country.
However, with the changes in the way healthcare is currently consumed, it would be anachronistic to base our service capacity solely on the organic and inorganic expansion of our PSCs. Today, expansion is no longer exclusively per square meter, but also for new digital and remote services. Saúde iD is one of the examples of this transformation. Another is the growth of our brands client's home services, which in 2Q21 represented 8.1% year, with growth of 40.4% if compared to the same period of the last year. An even more impressive fact is that today the revenue generated by client's home service corresponds to the average revenue of 25 PSCs of the Group. A differential of Grupo Fleury is the medical knowledge, which allows us to remain at the forefront in medicine, we continue to be a reference in innovation in healthcare. In 2021 alone, more than 192 new products and changes in methodology were implemented, with an emphasis on genomics tests, which have been growing by 100.8% in 2Q21.
As a Company that fully operates in healthcare, ranging from prevention to treatment, we have increasingly strengthened the integrated offer in various medical specialties. Revenue from new links, which go beyond diagnostics, increased 443% in the quarter compared to the previous year, and already represents 4.1% of the group's total revenue. In ophthalmology, Clínica de Olhos Moacir Cunha performs consultations, diagnostic tests, clinical treatments, surgeries and other procedures in a single location, and the addressable market for this specialty can reach R$ 2 billion per year. Likewise, we have just closed the acquisition of 66.7% of Clinica Vita, a premium asset that marks our complete entry into the orthopedics market, complementing the services of the advanced diagnostic center for locomotor apparatus and the Day Clinic for orthopedic procedures. To give an idea of the positive network effect that the inclusion of new links can bring to Grupo Fleury, the alone addressable market for orthopedics is estimated at around R$ 10 billion per year. Likewise, we have enhanced the immunobiological drug infusion service with the recent acquisition of the Centro de Infusões Pacaembu (CIP). The addressable market for infusions of immunobiological drugs moves around R$ 7 billion per year. The conclusion is only one: Saúde iD portential growth of these new links is exponential.
But it is worth reinforcing our unique position in the healthcare market: in addition to growth, we are building an integrated system that looks at the patient's needs and uses data to recommend what it really needs. More than that, our goal is to take care of people's health, so that they have a better life quality.
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