EMC's operating results in the 1st half of 2021

Cyprus, 28 July 2021. United Medical Group CY PLC (hereinafter referred to as "the Company", together with its subsidiaries, "the Group" or "EMC", MOEX ticker: GEMC), a leading provider of comprehensive premium medical services in Russia, operating under the brand "European Medical Center", hereby reports on operating and unaudited financial results for the 1st half of 2021.

• The Group's adjusted consolidated revenue[1] in the 1st half of 2021 amounted to EUR 134.31 mln (18.3% y/y). Most of medical professions contributed to the revenue growth, while the main growth derived from radiotherapy, oncology, radionuclide diagnostics, as well as from trauma and ophthalmology.
• The Group's adjusted consolidated revenue converted into rubles amounted to RUB 12,007.85 million[2] (+40.2% y/y).
• In the 1st half of 2021, revenues from outpatient and home care services amounted to EUR 76.77 mln (+27.7% y/y), primarily due to the significant increase of patients’ calls number.
• Hospital revenues in the 1st half of 2021 amounted to EUR 51.85 mln (+11.7% y/y) due to higher average purchase amounts resulting from the increased share of comprehensive services.

EMC CEO Andrey Yanovsky noted in his comment on the results of the 1st half of the year:

"We have become a public company very recently, and this is the first publication of our operating results. It is all the more pleasant to note that the results of the 1st half of 2021 are impressive. The Company has shown the growth not only in its major areas, such as oncotherapy, radiotherapy, trauma, but also for polyclinic services in most specializations. I would like to pay special attention to the fact that the share of modern and high-tech treatment methods is increasing, and the revenue from telehealth services has multiplied.

It proves the efficiency of our business pattern – creating a patient-centered integrated ecosystem based on deep medical expertise, efficient operational management and immaculate reputation".

Operating Results

• The number of visits to outpatient clinics, primarily for general treatment, physiotherapy, cardiology, neurology and ophthalmology, amounted to 296,010 (+ 22,2% y/y ).
• The average purchase amount for outpatient services amounted to EUR 259 (+ 4.4%), a stable increase as compared to the 1st half of 2020.
• The number of hospital admissions amounted to 8,275 (-2.7%) due to changes in the structure of services provided under mandatory health insurance programs. The focus has shifted from chemotherapy provided in day inpatient facilities to radiotherapy in outpatient clinics.
• The average purchase amount for hospital services has also grown and amounted to EUR 6,266 (+ 14.8%), due to the increased share of comprehensive and high-tech health services.

Important Note

NEITHER THIS ANNOUNCEMENT NOR THE INFORMATION CONTAINED HEREIN IS FOR PUBLICATION, DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, INTO AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES OR TO ANY PERSON IN ANY OF THOSE JURISDICTIONS OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE LAWS OF SUCH JURISDICTION.

These materials are not intended to and do not constitute investment advice. These materials do not constitute or form any part of and should not be constructed as an offer or commitment to sell or issue, a solicitation, recommendation, commitment or invitation to subscribe for, underwrite or otherwise acquire, and should not be construed as an advertisement for, any securities of United Medical Group CY PLC or any member of its group in any jurisdiction or an inducement to enter into investment activity in any jurisdiction.

These materials have been prepared on the basis of the Group’s management accounts. These materials do not contain sufficient information to constitute a full set of financial statements. The numbers presented in this statement have not been audited.

Overview

• EMC is the second largest private healthcare provider in Russia by revenue[4] and the largest by adjusted EBITDA[5] [6] and has been operating in the Russian private healthcare market for 30+ years – the longest track record of any major private healthcare business in this market[7]. EMC has grown rapidly in recent years, with adjusted revenue[8] of EUR 194.6 million, EUR 219.7 million and EUR 241.3 million for 2018, 2019 and 2020, respectively. Adjusted EBITDA for the same years was EUR 82.6 million, EUR 82.8 million and EUR 97.3 million, respectively. Profit for the period was EUR 51.7 million, EUR 59.5 million and EUR 80.6 million, respectively, for the same years.
• EMC is a fully integrated healthcare services provider offering a comprehensive range of diversified medical services, and has advanced capabilities in more than 57 specialisations, differentiating it from the competition in Russia.
• The Company utilises a patient-centric approach to its healthcare services offering, which allows it to provide patients with a full range of diagnostics and treatment services as well as offer tailor-made medical care. Being a provider of premium-quality medical care, EMC believes that it competes primarily with the leading international hospitals across Europe, Israel and Asia, and has been historically pricing its services in Euros.
• EMC’s network comprises seven multidisciplinary medical centres, one maternity centre and one rehabilitation centre (with a total built-up area of approximately 87 thousand square metres), as well as three geriatric centres (with a total built-up area of approximately 14 thousand square metres). As at 31 March 2021, the Group had 2,593 employees, comprising 752 physicians, 1,472 nurses and other medical staff and 369 administrative and support staff.
• EMC operates in Moscow and Moscow region, which is the main Russian metropolitan area, with a population of more than 20 million and the highest average salaries in the country[9], as well as a concentration of high-net-worth individuals, who form a core group of the Group’s clients.
• EMC is a leading Russian provider of cancer treatment with extensive expertise in a full range of modern oncology treatment methods, state-of-the-art facilities and equipment as well as renowned experts with international experience.

EMC believes that the market in which it operates has strong potential for future growth due to a number of factors, including favourable macroeconomic and prevailing demographic trends (such as an aging population and increasing life expectancy), increasing demand for high-quality medical services among Russians with a high disposable income, the significantly lower level of healthcare expenditure per capita in Russia compared to OECD countries, supportive government policies aimed at strengthening the private healthcare market, relative underpenetration of the Russian private healthcare market and substantial barriers to entry for new healthcare providers. According to NEO Center, EMC’s addressable market is estimated to be approximately 1.3 million customers, excluding Mandatory Health Insurance (MHI) programme, with the Company having served 69 thousand customers in 2020, excluding MHI.

Investor contact:

UMG IR Team
ir@emc-investors.com

Media Inquires

UMG PR Team
pr@emcmos.ru

https://emc-investor.com/
https://t.me/emcinvestor

[1]  Excluding construction revenue, in compliance with IFRS
[2] The revenues in RUB are calculated basing on the average EUR/RUB rate of the Central Bank of the Russian Federation for the relevant period.
[4] According to EMC estimates, based on data for 2020.
[5] For EMC, calculated as profit for the period/year adjusted for income tax benefit, other income / (expenses), net, (expense)/income on change in fair value of financial instruments, foreign exchange (loss)/gain, finance expense, and finance income, less construction revenue plus cost of construction, non-recurring expenses, depreciation of property plant and equipment (representing depreciation of property plant and equipment attributable to (a) Cost of medical services and products provided, (b) Selling expenses and (c) General and administrative expenses and amortisation of intangible assets (representing amortisation of intangible assets attributable to (a) Cost of medical services and products provided, (b) Selling expenses and (c) General and administrative expenses)) for the period.
[6] Estimated based on EMC’s adjusted EBITDA for 2020 and the latest publicly available information from the Company’s private healthcare Russian peers.
[7] According to EMC’s estimates.
[8] Calculated as revenue excluding construction revenue.
[9] According to NEO Center.