BP Vetedys ppt 1.2
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This document outlines Vetedys' business plan to develop a network of veterinary clinics in France through partnership agreements with local veterinarians. Key points: - Vetedys will bring turnkey clinics to partner veterinarians and provide marketing/financial support in exchange for monthly fees based on clinic revenues. - The plan is to open 4 clinics in 2012 and grow the network to over 100 clinics by 2018, developing mainly new clinics but also acquiring some existing practices. - Clinic formats include smaller "proximity" clinics and larger "central" clinics, with some specialized "regional centers" planned once sufficient clinics are established in a region. - The business is forecast to break even in
BP Vetedys ppt 1.2
- 1. Vetedys Business Plan – Confidential 14/05/2012 0
- 2. Vetedys Vetedys 30.05.12Joint Venture Partnership 1 Partnership Vetedys brings the Vet Partner a brand new clinic with marketing and financial assistance. Vetedys is remunerated with fees calculated based on the clinic incomes. The Vets keep all the benefits of the clinic. Joint Venture French laws are changing to an opening of the shareholding to non-vet, today limited to 25%. Although 25 % is enough to secure the partnership, the joint venture is ideally based on a 50/50 share of the clinic. New laws awaited for the end of 2012. The Vet Partner should invest an amount of ≈40 K€. Clinic Legal Status The legal status used for the clinics is SELAS (Société d’exercice libéral par actions simplifiée). This status allows more freedom to set governance rules. Vetedys benefits Income security with monthly fees based on turnover Partnership contract longevity Partner commited to the clinic’s profitability Partner Benefit Turnkey Clinic Complete retaining of clinic profits Services & Backup Holding Vetedys Top Co Partner X.Carbonel + Management Vet Practice 1 Vet Practice 2 Vet Practice 3 Vet Practice 4 Vet Practice 5 Vet 75% * 25% * Profits * Fees
- 3. Vetedys Vetedys 30.05.12Growth of network 2 Clinic Formats Two main formats ’Proximity’ and ‘Central’ are designed to supply veterinary care to small cities and agglomeration. ’Regional centers’ are high specialized medical where pets owners are referred to by basic clinics. Development Four clinics are opened in 2012. After 6 years, the network will number more than one hundred practices (111). Pace of development are up to speed in 2015 with 20 new practices per year. A ‘regional center’ needs a gathering of 8-10 clinics to be profitable. For this reason, we expect to open the first one in 2015. We anticipate an output of 1-2 clinics from 2017 as a natural evolution of the complete network. 2012 2013 2014 2015 2016 2017 2018 Practices (1st day of the year) 0 4 11 24 45 67 89 Practices (End of the year) 4 11 24 45 67 89 111 Small practices Opening of the Year 2 5 8 12 12 12 12 Total practices 2 7 15 27 38 49 60 Central practices Opening of the Year 2 2 5 8 10 10 10 Total practices 2 4 9 17 27 36 45 Regional center Opening of the Year 0 0 0 1 1 2 2 Total practices 0 0 0 1 2 4 6 Small practices Central practices Regional center Development ‘Cruising Speed’ ≈20 new clinics/year Ratio Small Practices/Central Practices The ratio is changing from around 2 to 1,2. The commercial real estate market is easier for small areas. This explains a relative faster development of smaller practices. Opening :Creation/Aquisition ? Since the strategy of development is based on prime location of practises, all opportunities will be taken. We expect that most of central (≈80%) and regional (100%) practices will be creation while small practices will be a balance of both (≈50/50)
- 4. Vetedys Vetedys 30.05.12Income Statement Fees 3 Practices Income The openings are taken in account Openings are mainly brand new practices (few purchase) that reach the ‘cruising speed’ after 3 year. Consequently, there is a lag-effect. Balance The breakeven is achieved in year 3 with a turnover of 530 K€. Vetedys Income per clinic The income per clinic in increases from 15,8 k€ (2012) to 31,1 K€ (2018) with 3 effects: first year is never a complete year, a clinic needs 3 years to reach a steady pace and referee centers with greater turnover Ebitda/Net Income Ratio From 2015, the Ebitda/Net Income ratio is a range between 1,5 and 2. It decreases from 1,75 in 2016 to 1,55 in 2018. Income: € 528,6k Income per clinic: €20,3k Profit Margin: 1,8% Income: € 1766,0k Income per clinic: €26,4k Profit Margin: 17,0% Income: € 3453,0k Income per clinic: €31,1k Profit Margin: 22,9% Small practices Central practices Referee center Service Fees 5,0% 5,0% 5,0% Communication fees 2,5% 2,5% 2,5% Entrance Fees 5000 10000 25000 Training Cost 3000 5000 12000 Purchasing fees 1,5% 1,5% 1,0% Total fees 9,0% 9,0% 8,5% Fees in k€ 2012 2013 2014 2015 2016 2017 2018 Total Income Practices 463,2 1 914,6 4 688,9 9 744,4 16 811,5 25 133,4 35 167,0 Total Income VETEDYS 62,7 223,2 528,6 1 108,0 1 766,0 2 550,0 3 453,0 Vetedys Income per Clinic 15,7 20,3 22,0 24,6 26,4 28,7 31,1 Operating Expenses -105,0 -221,8 -422,4 -768,8 -1 232,6 -1 625,6 -2 181,2 EBITDA -42,3 1,4 106,2 339,2 533,4 924,4 1 271,8 Depreciation -12,7 -34,3 -41,0 -36,7 -25,0 -30,0 -35,0 EBIT -54,9 -33,0 65,2 302,5 508,4 894,4 1 236,8 Interest due -19,1 -40,0 -55,7 -63,6 -58,9 -53,4 -47,7 EBT -74,0 -73,0 9,4 238,9 449,5 841,0 1 189,2 CAT (Corporate Income Tax) 0,0 0,0 0,0 -33,7 -149,7 -280,1 -396,0 Net income -74,0 -73,0 9,4 205,2 299,8 560,9 793,2
- 5. Vetedys Vetedys 30.05.12 Investing activities: From 2016, clinics are 100% funded by debt Cash Flow Statement 4 Operating Activities The openings are taken in account Openings are mainly brand new practices (few purchase) that reach the ‘cruising speed’ after 3 year Investing activities Investing activities are the main Mainly, cash is invested in clinic as capital contribution: 2012: 20% of total investment 2013: 15% - 2014: 10% - 2015: 5% - From 2016, clinics are 100% funded by debt Financing activities The amount of stock and current account contribution is up to 700K€. The amount of long term debt debt reaches 1M€. The Cash Flow from operating activities start to be positive from 2014. After 2014 the need for cash is mainly due to the investment in new practices. The net income in cash & cash equivalent is positive every year with an exception in 2015 that marks a turning point towards an amount of cash flow from operating activities suffficient to finance development. Working capital needs: They are very low since there is monthly payment from clinics. Stock & current account contribution: 950K€ in 4 years Long Term Debt: 900K€ in 4 years in k€ 2012 2013 2014 2015 2016 2017 2018 Cash Flow from Operating Activities Net Earning -74,0 -73,0 9,4 205,2 299,8 560,9 793,2 Depreciation and amortization -12,7 -34,3 -41,0 -36,7 -25,0 -30,0 -35,0 Interest Payable -19,1 -40,0 -55,7 -63,6 -58,9 -53,4 -47,7 Increase/decrease in working capital needs -1,8 -4,5 -8,6 -16,2 -18,4 -22,0 -25,3 Net Cash by Oper. Activities -44,0 -3,1 97,6 289,2 365,3 622,4 850,5 Cash Flows from Investing Activities Cash paid for acquisitions (Clinics) 240,0 390,0 375,0 330,0 0,0 0,0 0,0 Property, Plant and Equipment-operations 38,0 65,0 20,0 25,0 30,0 35,0 40,0 Intangible Assets 118,0 0,0 0,0 0,0 0,0 0,0 0,0 Net Cash Prov. (Used) by Inv.Act. -396,0 -455,0 -395,0 -355,0 -30,0 -35,0 -40,0 Cash Flows from Financing Activites Interest Payable -19,1 -40,0 -55,7 -63,6 -58,9 -53,4 -47,7 Proceeds from issuance of long-term debt (Loan) 250,0 250,0 150,0 150,0 0,0 0,0 0,0 Payments of Long-Term Debts 0,0 -30,6 -62,8 -84,3 -107,0 -112,5 -118,2 Proceeds from issuance of Stock & Current Account Contributions250,0 300,0 289,7 110,3 0,0 0,0 0,0 Net Cash Prov. (Used) by Fin. Act. 480,9 479,4 321,2 112,4 -165,9 -165,9 -165,9 Net Inc (Dec) in Cash and Cash Equivalents 40,9 21,3 23,8 46,6 169,4 421,5 644,7 Cash and Cash Equivalents, Beginning 0,0 40,9 62,2 85,9 132,5 302,0 723,5 Cash and Cash Equivalents, Ending 40,9 62,2 85,9 132,5 302,0 723,5 1 368,1 2012 2013 2014 2015 2016 2017 2018 Increase in working capital Needs/Augmentation du BFR 1,8 4,5 8,6 31,0 18,4 22,0 25,3 1,8 6,2 14,8 31,0 49,4 71,4 96,7Working Capital Needs
- 7. Vetedys Vetedys 30.05.12Capital Expenditure 6 Details Communication Costs of designing, interior architect and other concept related costs. Lawyer Cost Costs of investors partnership agreement, vet partner contract, the articles of the holding and clinic statutes model , deposit of brand mark and others legal costs. Devlpt. Cost Costs of the market study model and materials. Informatics Expenses Costs of internet and intranet, software and hardware. OneOff Costs (k€) Intangible & Tangible Invest 2012 2013 2014 Management - - - Communication 36,0 - - Lawyer costs 82,0 - - Development Exp. 13,0 - - Informatic Exp. 17,0 50,0 20,0 Support and Training 5,0 5,0 - Cost of Services 0,0 10,0 - General and Administrative 3,0 - - TOTAL 156,0 65,0 20,0 Cash paid for acquisitions (Clinics) 2012 2013 2014 in k€ 170,0 390,0 375,0 Informatics Expenses: The costs are spread over 3 years and meet the need to design collaborative intranet tools, monitoring and internet website Communication and lawyer Expenses: The costs are mainly concentrated on the first year when the concept and the partnership should be created. Financial needs for the 4 first years reaches 1577 K€ which is funded up to 47 % by investment and 53% by long term debt. Except the first year, most of the financial need is investment in clinics. 2012 2013 2014 2015 2016 2017 2018 Financial Needs (k€) 397,8 459,5 403,6 386,0 48,4 57,0 65,3 Including financial needs for acquisitions 60% 85% 93% 85% 0% 0% 0%
- 8. Vetedys Vetedys 30.05.12Business Valuation – (Ebit Method) 7 in K€ 2015 2016 2017 2018 EBITDA 339,2 533,4 924,4 1 271,8 Financial debt 622,3 515,3 402,8 284,6 5 1 696,0 2 667,2 4 622,1 6 359,1 5,5 1 865,6 2 933,9 5 084,3 6 995,0 6 2 035,2 3 200,6 5 546,5 7 631,0 6,5 2 204,8 3 467,3 6 008,7 8 266,9 5 1 073,7 2 151,9 4 219,2 6 074,5 5,5 1 243,2 2 418,6 4 681,4 6 710,4 6 1 412,8 2 685,3 5 143,6 7 346,3 6,5 1 582,4 2 952,0 5 605,8 7 982,3 Estimated Valuation - Ebit Method Estimated valuation of the shareholdings (=EVC less financial debt) Estimated valuations of the compagny using multiple of (EVC)