Contents
• How we can help grow your business
• Sources and solutions
• Long-term partnerships
• Best practises
• Case studies
• Summary
July 11, 2017 Philips Capital2
3 Philips CapitalJuly 11, 2017
For more than 120 years, Philips has improved people’s lives through meaningful innovation
We’re aiming to improve the lives of
three billion peoplea year by 2025
Our legacy in healthcare has been built on meaningful innovation in many different areas, including financing
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How can we help your business?
• We are constantly adapting to your needs and to the rapidly changing nature of the markets
• Our one-stop financing model means we can take care of all your financing needs
• Our vision is to provide end-to-end tailored solutions, for small and simple or large-scale
projects
• Our team’s unique mix of expertise, scale and speed helps you take advantage of increasingly
robust financial markets
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Our commitment to you
We will:
• Initiate unique, personalized strategies to meet your needs
• Enter into partnerships with third-party financial institutions
• Offer direct financial support in certain situations
• Ensure that our experts are closely connected with your local cultures, business environments and needs through our global network
• Build long-term relationships where you benefit from the wealth of Philips’ innovation, understanding and expertise
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The Philips Capital team is comprised of experts from a wide range of disciplines
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Philips CapitalPeter Warmerdam
CEO
AfricaASEAN & Pacific
BeneluxCEE
DACHFrance
Greater ChinaIberia
IIG
IndiaJapanLatAmMETNAM
NordicsRussia & Central Asia
UK & Ireland
Center of Expertise
PAHR business
partner
Markets
Finance business partner
Hester Boomgaard
Risk & Portfolio Management
Marcio Barbosa
Project Development & Structured Finance
Nalin Sachdeva
Identifying the best financial structure
We offer:
• Finance / operating lease
• Full service lease
• (Soft) Loan
• Supplier’s credit
• Export & trade financing
• Sale of receivables
• Buyer’s credit
• Equity
• Project finance
• Public / private partnerships
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Our packagesWe can help arrange a myriad of financial structures
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Loan structures
Finance / Operatingleasing
Equity participation
Managed Equipment Services
Pay Per Use
Supplier’s credit
Complexity of solution
Integration in solution / deal size
Our structured payment plan offers predictability and flexibility
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Conventional cash transactionTotal cost of ownership over time
CAPEX
Maintenance & service
Average total cost of ownership
Managed Service agreementTotal cost of ownership over time
Lower total cost of ownershipReduction in equipment cost burden
From transactional to partnerships
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Level of Partnership
Complexity
CAPEX
Finance lease
Operating lease
Managed service
Profit sharing / Clinical outsourcing
Pay per Use
Public / Private- Private Partnership (equity)
Finding ways to keep healthcare affordable and
sustainable
From traditional banks to impact investors
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“Soft”
Accessibility
Commercial loans
(Social) Impact investor
Outcome- / performance-based financing
Bi-lateral protocols
Export finance
Soft loan
Finding the most suitable financial
source
Financial sourcingDeliver appropriate funding resources
• We partner with global relationship banks as well as with strong local/regional financial institutions.
• In certain markets we have dedicated partnerships and branded programs (e.g. Philips Medical Capital)
• We have strong relationships with multilateral development banks, international finance Institutions and (development) funds
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Financial sourcingAssessment of most beneficial (combination of) financing structure
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Services
Loan / Lease agreement
Equipment
End user
Consultancy / Training
PhilipsCustomer
Changing healthcare environment requires new business models and partnership strategies
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PhilipsCustomer
Shared accountability modelJoint focus on partnership goals with shared risk and
performance incentives
Traditional transactional modelPayments for equipment
and services at discounted pricing
Business model evolution
Common goals
PredictabilityShared riskContinuous
improvementReduced OPEX
Innovation
Our managed services model is about partnership
A managed services partnership with Philips is• comprehensive;• end-to-end;• aligned to your strategic initiatives;• structured around a specific business/financial model
Our partnership framework establishes a long-term strategic collaboration built on flexibility, transparency, shared governance and mutual accountability.
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Managed services overviewComprehensive solutions for long-term services management
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Managed
Services
Partnership
Technology management
Equipment services
Clinical education
Performance improvement
Consulting
Financing
Innovation
Improved clinical qualityWorld-class, patient- and family-centered
care that is safe, effective, timely and appropriate
Greater efficiencyEfficient delivery of patient services and
operational activities across the continuum of care
Market leadershipLeading in the innovation and delivery of
new clinical services and medical technology for patients in your community
Resource optimizationAbility to better deploy and manage
resources (people, technology, capital) to support strategic goals of system
Managed services partnership foundations
Business framework• Typically 15-year term
• The agreement can cover medical technology, operations, services, innovation and financing, depending on
your needs
Financial model• Technology-as-a-service model: moving from reactive, short-term capital planning to a predictable, known
expense structure
• Performance-based incentive program based on clinical, operational and financial outcomes
Operating model• Dedicated on-site staff
• Integrated governance and operating structure
• Joint responsibility for planning, specification, selection, procurement, upgrading and replacement of all
equipment in scope
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Managed services partnership benefits
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• Lower total cost of ownership
• Reduce investment costs
• Standardization enhances clinical accuracy
• A secure, long-term arrangement
• Accelerated access to new technologies
• Keep all current equipment and software under contract
• You have a predictable payment structure instead of volatile capital spending
Managed equipment services partnershipEach partnership consists of a unique combination of various solution components
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Benefit Clinical Financial Operational
Capital asset plan Timely access to new systems ++
Technology innovationAccess to innovation when
available++
Maintenance managementAvailability of medical
technology+ ++
Procurement Hassle free, simplification + ++
System integration & program managementSingle point of contact and
liability+ + ++
DesignSeamless technology interface
with patient++ +
EducationOptimization of use of
technology++ + +
Healthcare transformation services Performance solutions + + +
Research and innovationBringing care faster to the
patient++
Financing servicesDo more with available budget, cost control and predictability
++
Managed services contractBenefits: monthly flat fee / full-service lease concept
• Transparent and predictable budget forecasting
• Preservation of cash position and funding exposure capacity with banks
• Finance up to 100% of total investment (incl. installation + software + VAT) without down payment/ equity contribution
• In case of operating lease (1) no ownership and aging and/ or devaluation risks; (2) lower monthly payment, due to residual value; and (3) lower tax bite, due to tax spread out/ paid over time
• Shortening of the balance sheet and therefore indirectly strengthens net worth position with potential access to cheaper funding
• Expand, replace or upgrade if and when required
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Summary
• Our partnership strategy helps your business grow
• Our solutions are always unique so they precisely match your requirements
• You have the reassurance of long-term support from a world leader in healthcare
• Our approach has already been proven successful around the globe