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1
2014 Jefferies Global Healthcare Conference
Gerald B. Blouch
President and Chief Executive Officer
June 4, 2014
Invacare Corporation (NYSE: IVC)
2
This presentation contains forward-looking statements within the meaning of the
“Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are those that describe future outcomes or
expectations that are usually identified by words such as “will,” “should,” “could,”
“plan,” “intend,” “expect,” “continue,” “forecast,” “believe,” and “anticipate” and
include, for example, any statement made regarding the Company's future results.
Actual results may differ materially as a result of various risks and uncertainties,
including the current FDA consent decree to which the Company is subject, as well
as other risk factors described in the Company's Form 10-K and other filings with
the Securities and Exchange Commission and in the Company's earnings press
releases. The Company may not be able to predict and may have little or no
control over many factors or events that may influence its future results and,
except as required by law, shall have no obligation to update any forward-looking
statements.
Safe Harbor Statement
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Invacare Corporation – Market Leader
Invacare Corporation (NYSE: IVC), a leading manufacturer and distributor of home
medical devices with annual revenues of $1.4 billion selling to home medical
equipment and long-term care providers in over 80 countries worldwide.
More than half of the Company’s revenues are outside of the United States, primarily
in Europe, as of December 31, 2013.
Equity market capitalization of approximately $532 million.
Enterprise value of approximately $584 million*.
*Based on debt outstanding as of March 31, 2014.
4
Compelling Business Case For Homecare
1Leff B, Burton L, Mader SL, et al. Hospital at home: feasibility and outcomes of a program to provide hospital level-care at home for acutely ill older patients, Ann Intern Med 2005; 143:
789-808; 2Doty, Pamela. “Cost-Effectiveness of Home and Community-Based Long-Term Care Services.” USHHS/ASPE Office of Disability, Aging and Long-Term Care Policy. June 2000: 10. 3”Cleveland Clinic – Innovating Innovations.” Healthcare Innovation News. Volume 1, Issue 1. 2014
Invacare participates in a market with strong underlying fundamentals: favorable
demographic trends and the compelling benefits of homecare.
Homecare is the trifecta of healthcare: patient preferred, better clinical outcomes1
and more cost-effective than institutionalized care2.
In the United States, it is now generally accepted that healthcare is in need of
reform. The Affordable Care Act is shifting Medicare’s “fee for service” model
of reimbursement toward a value-based model – one that prioritizes quality of
outcomes over volume of services3.
Controlling escalating healthcare costs requires integrating each element of the
health care continuum to reduce lengths of stay and lower readmission rates.
“Science and medicine bring new and thoughtful applications that allow patients to
remain at home for testing, monitoring and treatment. These advances
continue to reduce unnecessary hospitalizations. Home healthcare is the
next great medical frontier,” according to Floyd D. Loop, MD, former chief
executive officer and chairman, Board of Governors at the Cleveland Clinic.
6
Industry Leading Worldwide Market Positions
Invacare is the #1 player in most home durable medical equipment device lines
Invacare
Sunrise*
Pride*
Drive*
Medline*
Handi-
care*
Permobil*
Res-
pironics
Chart
Industries
Powered Mobility
(excluding scooters)
Manual Mobility
(active)
Manual Mobility
(low-active)
Lifestyle #1
Beds & Furnishings #1
Oxygen Therapy #1
Patient Handling
#1 Market Leader Second Tier Small Share * Private Company
#2
#2 #1
#1
Industry is primarily private, so market share data is estimated.
#1
7
Global Product Innovator
Invacare® HomeFill® Oxygen
System with Perfecto2® Oxygen
Concentrator and M2 Cylinder
Alber® twion® Power Assist
for manual wheelchairs
Alber® Scalamobil®
Stair Climber
Invacare® TDX® SP Wheelchair with tilt
and recline powered seating, Stability Lock
and SureStep technology
8
Historic Results
(1) Adjusted EPS and Free Cash Flow are non-GAAP financial measures as defined in the relevant year-end earnings
releases which can be found on www.invacare.com.
(2) Including the results of Invacare Supply Group, GAAP EPS was $0.78 in 2010 and ($0.13) in 2011. For full details,
view the relevant year-end earnings releases at www.invacare.com.
(3) Includes the results of Invacare Supply Group, which the company divested on January 18, 2013, and Champion
Manufacturing, which was divested on August 6, 2013. Refer to the Company’s February 8, 2013 earnings release
for more information.
(4) 2012 and 2013 were negatively impacted by the Company’s consent decree with the United States Food and Drug
Administration (FDA) at the Company’s Taylor Street manufacturing and corporate facilities in Elyria, Ohio.
2010(3) 2011(3) 2012(4) 2013(4)
Organic Growth 1.0% 1.7% 0.9% (6.3%)
Adjusted EPS(1) $1.84(2) $2.05(2) $0.22 ($1.20)
Free Cash Flow(1) $105 million $81 million $49 million $6 million
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Near-Term Objectives
1. Reinvigorate new product development
In July 2013, the FDA accepted the third-party certification report on the Company’s
design controls system. This allowed the Company to resume design activities, which
are currently prioritized on critical new product development projects as the Company
continues quality systems remediation activities.
2. Resume full operations at custom power wheelchair manufacturing facility in
Elyria, Ohio
On December 21, 2012, Invacare entered into a consent decree with the United
States Food and Drug Administration at its corporate and Taylor Street custom
wheelchair manufacturing facilities in Elyria, Ohio.
In order to resume full operations at these facilities, the terms of the consent decree
require three, third-party expert certification audits followed by an FDA inspection.
Two of the three certification audits have already been completed and accepted by
the FDA. The third certification audit is underway.
3. Aggressively work to re-establish leadership position in the North American
Complex Rehab Technology market.
10
Product Innovation & Rationalization
Engineering
Commercial Operations
Supply
Chain
Globalization - Transformation Cycle
*Timing to be reviewed upon exit of the injunctive phase of the consent decree
The fulcrum for the Company’s globalization program is the harmonization of core
product lines and complexity reduction throughout the business.
The transformation cycle will be driven by globalization of product innovation and
platforms.
$100 million
annualized
savings*
The Company expects this corporate-wide
complexity reduction to result in $100 million
in annualized savings through:
Product cost reduction
Operational efficiencies
Streamlined support infrastructure
Increased market share
11
Investment Highlights
Invacare participates in markets with strong underlying fundamentals
Positive demographic trends
Growing prevalence of chronic disease states
Public policy and technology shifting to support the transition from acute care to long-term care to homecare
And in these markets, Invacare is a well positioned company …
Industry leading market positions
Strong brand reputation with superior and innovative products
Strong sales and marketing coverage without major exposure to a single customer
A diverse geographic revenue base selling into over 80 countries worldwide
A diverse product portfolio
Management team with significant ownership
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