Sectorwatch: Healthcare & Life Sciences Management Consulting€¦ · Healthcare & Life Sciences...

Sectorwatch:Healthcare & Life Sciences Management ConsultingQ4 2019

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Healthcare & Life Sciences Management ConsultingQ4 2019 Sector Dashboard [4]

Public Basket Performance [5]

Operational Metrics [7]

Valuation Comparison [10]

Recent Deals [12]

7 Mile Advisors appreciates the opportunity to present this confidential information to the Company. This document is meant to be delivered only inconjunction with a verbal presentation, and is not authorized for distribution. Please see the Confidentiality Notice & Disclaimer at the end of the document. Alldata cited in this document was believed to be accurate at the time of authorship and came from publicly available sources. Neither 7 Mile Advisors nor 7MSecurities make warranties or representations as to the accuracy or completeness of third-party data contained herein. This document should be treated asconfidential and for the use of the intended recipient only. Please notify 7 Mile Advisors if it was distributed in error.

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Overview

7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally. We advise on M&A and private capital transactions, and provide market assessments and benchmarking. As a close knit team with a long history together and a laser focus on our target markets, we help our clients sell their companies, raise capital, grow through acquisitions, and evaluate new markets. We publish our sectorwatch, a review of M&A and operational trends in the industries we focus.

Dashboard• Summary metrics on the sector• Commentary on market momentum by

comparing the most recent 12-month performance against the last 3-year averages.

Public Basket Performance• Summary valuation and operating metrics

for a basket of comparable public companies

Valuation Comparison• Graphical, detailed comparison of valuation

multiples for the public basket

Recent Deals• The most recently announced deals in the

sector

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Dashboard

Operating Metrics

Valuation

Revenue Growth Momentum

4.1%One year revenue growth percentage compared to

revenue growth average percentage for last 3

years.

Pricing / Gross Margin Momentum

1.2% One year gross profit percentage compared to

gross profit percentage average for last 3 years.

Profitability

-1.5% One year EBITDA percentage compared to EBITDA

percentage average for last 3 years.

Current revenue growth rate exceeds the average of the last 3 years by

this amount, indicating that market momentum is increasing.

Current gross profit margin slightly exceeds the average of the last 3

years gross profit margin by this amount so companies are maintining

margins.

Current EBITDA margin is a bit less than the average of the last 3 years,

consistent with the contraction in gross margin.

9.2%

10.3%

35.4%

0% 10% 20% 30% 40%

Median LTM Revenue Growth %

Median LTM EBITDA Margin %

Median LTM Gross Profit Margin

%

1.5x

13.1x

17.9x

18.0x

0x 5x 10x 15x 20x

Median TEV / LTM Revenue

Median TEV / LTM EBITDA

Median Price / LTM Earnings

Median TEV / LTM EBIT

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Public Basket

Company TEV $mLTM Rev

$m

Rev Growth

YoY GP %EBITDA

%TEV / Rev X

TEV / EBITDA

X # FTEsRev / FTE $k

Accenture plc 110,953 43,215 9% 31% 17% 2.6 15.4 492,000 88

FTI Consulting, Inc. 4,172 2,255 13% 35% 15% 1.8 12.5 4,768 473

Allscripts Healthcare Solutions, Inc. 2,649 1,751 14% 48% 7% 1.5 22.8 9,500 184

Huron Consulting Group Inc. 1,668 829 10% 35% 12% 2.0 16.3 3,269 254

Cegedim SA 685 553 5% 45% 10% 1.3 11.8 4,374 126

CRA International, Inc. 493 429 9% 30% 9% 1.2 13.1 687 625

Cello Health plc 183 213 -1% 64% 8% 0.8 10.5 973 219

Average 17,258 7,035 9% 41% 11% 1.6 14.6 73,653 281

Median 1,668 829 9% 35% 10% 1.5 13.1 4,374 219

share price as of 26Oct19

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Public Basket Valuation Trends

Public EBITDA Multiples over Time

Public Revenue Multiples over Time

0.0x

0.4x

0.8x

1.2x

1.6x

2.0x

TEV/Revenue - Median TEV/Revenue - Average

0x

4x

8x

12x

16x

TEV/EBITDA - Median TEV/EBITDA - Average

11.8x

1.4x

0x

2x

4x

6x

8x

10x

12x

14x

16x

TEV/EBITDA - Median TEV/Revenue - Median

TEV/EBITDA - Average TEV/Revenue - Average

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Operational Metrics

LTM Revenue Growth %LTM Revenue per

Full Time Employee x 000’s

$- $200 $400 $600 $800

Median

Accenture plc

Cegedim SA

Allscripts Healthcare

Solutions, Inc.

Cello Health plc

Huron Consulting Group

Inc.

FTI Consulting, Inc.

CRA International, Inc.

-10% 0% 10% 20%

Median

Cello Health plc

Cegedim SA


Accenture plc


Inc.



Solutions, Inc.

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Operational Metrics

LTM Gross Profit Margin % LTM EBITDA %

0% 5% 10% 15% 20%

Median

Allscripts

Healthcare

Solutions, Inc.

Cello Health plc

CRA International,

Inc.

Cegedim SA

Huron Consulting

Group Inc.


Accenture plc

0% 20% 40% 60% 80%

Median


Accenture plc


Inc.


Cegedim SA


Solutions, Inc.

Cello Health plc

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Valuation

TEV / LTM Revenue TEV / LTM EBITDA

0x 1x 2x 3x

Median

Cello Health plc

CRA International,

Inc.

Cegedim SA

Allscripts

Healthcare

Solutions, Inc.

FTI Consulting,

Inc.

Huron Consulting

Group Inc.

Accenture plc

0x 4x 8x 12x 16x 20x 24x

Median

Cello Health plc

Cegedim SA



Accenture plc


Inc.


Solutions, Inc.

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Valuation

Price / LTM Earnings Historical Valuation Multiples versus Revenue Growth Rate

0x 10x 20x 30x 40x 50x 60x

Median


Cello Health plc


Accenture plc


Inc.

10x 12x 12x 13x 15x 16x 23x-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

0x

5x

10x

15x

20x

25x

LT

M R

GR

%

EB

IT

DA

(x)

EBITDA(x) LTM RGR%

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In the last twelve months there were transactions totaling $5.7btransactions in the healthcare and life sciences managementconsulting sector. 7 Mile Advisors tracked 123 transactionsin the sector, including 66 M&A transactions.

RECENT TRANSACTIONS SUMMARY

All Transactions by RegionAll Transactions by Type

Merger & Acquisition Statistics

Valuation Summary

Total Deal Value($mm): $5,686.21

Average Deal Value: $334.48

Average TEV/Revenue: 3.73x

Average TEV/EBITDA: 16.67x

Average Day Prior Premium(%): 31.35%

Average Week Prior Premium(%): 33.32%

Average Month Prior Premium(%): 33.18%

Most Active Buyers/Investors by Number of Transactions Most Active Buyers/Investors by Total Transaction Size

Company NameNumber Of

TransactionsCompany Name

Transaction Size ($mm)

Da Vinci Capital Management Ltd. 2 DXC Technology Company (NYSE:DXC) 2,072.15

IQVIA Holdings Inc. (NYSE:IQV) 2 Guidehouse LLP 1,234.01

Xinxing Jihua Pharmaceutical Holdings Co., Ltd. 2 Industrial Scientific Corporation 570.0

22C Capital LLC 1 Kinnevik AB (OM:KINV B) 550.0

Advent International Corporation 1 Public Investment Fund 550.0

Aier Eye Hospital Group Co., Ltd. (SZSE:300015) 1 Vostok New Ventures Ltd (OM:VNV SDB) 550.0

Alper Consultoria e Corretora de Seguros S.A. (BOVESPA:APER3) 1 Munich Re/HSB Ventures 550.0

Apervita, Inc. 1 EQT Partners AB 531.07

Artis Capital Management, L.P. 1 Intermountain Healthcare, Inc. 450.0

Ashfield Healthcare Communications Ltd 1 Xinxing Jihua Pharmaceutical Holdings Co., Ltd. 296.47

Private

Placement47%Merger/Ac

quisition53%

Europe

11%

Asia /

Pacific23%

Africa / Middle

East1%

United States

and Canada64%

Latin America and

Caribbean1%

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Recent TransactionsDate Target Buyer / Investor

Total Transaction

Value Target

Revenue TEV /

Revenue TEV /

EBITDA

23Oct19 Avia Health Innovation Sumitomo Corporation of Americas; First Trust Capital Partners LLC; B.C. Ziegler and Company, Investment Arm

22.00 - - -

13Oct19 Remedy Chicago Inc. The Motion Agency - - - -

11Oct19 Lynx Product Group, LLC Chalmers Group - - - -

11Oct19 Q BioMed Inc. Yorkville Advisors Global LP; YA II PN, LTD. 0.75 - - -

1Oct19 Arcus Global Media, LLC W2O Group - - - -

9Oct19 Rapid Dose Therapeutics Corp. - - 0.01 - -

9Oct19 Hamilton & Co. Schjodt - - - -

3Oct19 salesforce.com, inc. - 124.77 14,729.00 - -

2Oct19 Definitive Healthcare, LLC 22C Capital LLC - - - -

2Oct19 Brio Bliss Life Sciences Pvt. Ltd./Nutri Synapzz Therapeutix Pvt. Ltd.

Shield Healthcare Pvt. Ltd. - - - -

2Oct19 Orikami B.V. Healthy Capital Management B.V. 0.66 - - -

1Oct19 Silicus Technologies, LLC Infogain Corporation - - - -

30Sep19 ECG Management Consultants, Inc. Siemens Medical Solutions USA, Inc. - 100.00 - -

30Sep19 Aptus Health, Inc. WebMD Health Corp. - - - -

30Sep19 CBIZ, Inc. P2 Capital Partners, LLC - - - -

26Sep19 eMids Technologies Inc. New Mountain Capital, L.L.C - - - -

26Sep19 AMN Healthcare, Inc. - 300.00 - - -

24Sep19 Thermo Fisher Scientific Inc. - 982.71 24,868.00 - -

19Sep19 Shanghai Fosun Pharmaceutical (Group) Co., Ltd. Shanghai Fosun High Technology (Group) Co., Ltd. 3.20 3,837.88 - -

12Sep19 Waters Corporation - 500.00 2,406.06 - -

10Sep19 PerkinElmer, Inc. - 847.20 2,801.92 - -

9Sep19 Healthway Medical Corporation Limited - - 80.29 - -

5Sep19 Inventure LLC - - - - -

3Sep19 Box, Inc. Starboard Value LP - - - -

29Aug19 LEOCLAN Co.,Ltd. - 10.60 - - -

28Aug19 ThoughtSpot, Inc. Silver Lake; Sapphire Ventures LLC; Lightspeed Venture Partners; Silver Lake Waterman; Geodesic Capital

248.00 - - -

28Aug19 Computer Task Group, Incorporated Wax Asset Management, LLC - - - -

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7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally. We advise on M&A and

private capital transactions and provide market assessments and benchmarking. As a close-knit team with a long history together and a laser

focus on our target markets, we help our clients sell their companies, raise capital, grow through acquisitions, and evaluate new markets.

Securities offered through 7M Securities LLC.

Leroy Davis, Partner 704.899.5962 [email protected]

Tripp Davis, Partner 704.899.5762 [email protected]

Andy Johnston, Partner 704.899.5961 [email protected]

Ben Lunka, Managing Director 704.496.2995 [email protected]

Jeff Stoecklein, Managing Director 312.796.9330 [email protected]

Mark Landry, Managing Director 561.972.0609 [email protected]

Kristina Sergueeva, Director 704.899.5149 [email protected]

Neil Churman, Director 281.742.9340 [email protected]

John Cooper, Director 704.973.3996 [email protected]

Tim Frye, Director 704.973.3994 [email protected]

Ben Garber, Vice President 412.626.7898 [email protected]

Nicholas Prendergast, Financial Analyst 704.973.3995 [email protected]

Ariail Siggins, Marketing Director 704.981.2908 [email protected]

Emily Halstenberg, Marketing & Sales Coordinator 704.409.9912 [email protected]

Sydney Larese, Associate 704.973.3998 [email protected]

Marty Johnson, Associate 704.973.3999 [email protected]

Rory Julyan, Associate 704.981.2520 [email protected]

Garth Martin, Associate 704.973.3997 [email protected]

Dennis Fox, Associate 704.706.9168 [email protected]

Steve Buffington, Associate 704.960.1828 [email protected]

CONTACT INFO

Sectorwatch: Healthcare & Life Sciences Management Consulting€¦ · Healthcare & Life Sciences...

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