Specialist
Former C-Suite at Medivet Group Ltd
Agenda
- Medivet’s competitive positioning in the veterinary care market vs players such as VetPartners, IVC and CVS (LON: CVSG)
- Medivet’s service mix and demand outlook in the animal health market across service type
- Sustainability of vet chain economics and 2023 outlook
- Key growth drivers for Medivet and potential valuations in the veterinary care market
Questions
1.
What key trends are we seeing in the UK veterinary market? How is the market behaving post-pandemic?
2.
You mentioned market growth being somewhere around 6-8%, so based on everything we’ve discussed, how sustainable do you see this being or how might it evolve?
3.
We observed an increase in pet ownership and pet spending during the pandemic. How should we think about the spending on veterinary services in the UK, and how might that trend?
4.
You mentioned the digital opportunity. Could you expand on that? Does what you mentioned around further investment into digital apply predominantly in the UK veterinary market, or does it apply more broadly, such as in other key European markets?
5.
You mentioned some of the players operating in the veterinary market, such as VetPartners and IVC, but how well-positioned do you see Medivet as in terms of the transition or moving towards the digitisation we’ve discussed?
6.
We discussed some of the key trends we’re observing in the UK veterinary market, and going back to our comments about the demand for pet ownership as well as spend per pet in the UK, how might that compare between the UK and other markets in Europe? I’m thinking about key markets for Medivet such as Germany or Spain.
7.
Could you outline how demand is trending across animal and service types in the UK? The pandemic might have somewhat contributed to a shift in service mix towards the small-animal market, so how might that fit into the demand question?
8.
Specifically looking at the surgical procedures and labs, how well-placed do you think players such as Medivet are to capitalise on such a service vs larger-sized players such as IVC, CVS or VetPartners?
9.
You mentioned the healthcare plans and pet insurance. Tying this back to spending on veterinary services, could you outline how demand for healthcare plans and pet insurance is trending at the moment in the UK, and how sustainable you see it as?
10.
Specialists in previous Forum Interviews noted that insurances may typically fall off after a couple of years, but despite this, there is still room for sustainable growth. Do you agree?
11.
Could you outline who Medivet is and what its key services offered are? What’s the geographical distribution of its chains and what is its competitive positioning vs players such as VetPartners, CVS, IVC and other incumbents?
12.
How should we think about the services you mentioned with respect to profitability? How profitable are those different revenue streams relative to one another?
13.
Following up on procurement, how easily could Medivet demand greater discounts from suppliers? Would a player such as CVS have more bargaining power with suppliers than Medivet?
14.
How much of a greater discount and procurement could a large vet chain capture through economies of scale vs a smaller chain such as Medivet?
15.
You mentioned the importance behind Medivet being clinically led. Could you expand on this? How might some of the services offered by its core competitors compare to the company’s?
16.
If we look at some of the macroeconomic pressures that many veterinary chains are experiencing, we’re seeing staff shortages, as well as wage inflation. To what extent do you see vet chains such as Medivet being more or less exposed to such pressures vs some of its closest peers?
17.
Looking at some of the current labour dynamics for veterinarians, specialists in previous Forum Interviews noted that in the UK veterinary care market, around 10% of vets are missing and that the base salary has gone up approximately 25% vs pre-pandemic levels. Do you agree? What is your outlook in relation to these labour dynamics?
18.
In the context of the macroeconomic pressures we’ve discussed, and looking at the sustainability of and for vet chains’ economics, how do you see prices for Medivet’s services trending or evolving? Do you think the company can maintain its current prices?
19.
Does Medivet offer a somewhat more premium price, in which case the company could be more exposed to some of the pressures?
20.
How have valuations trended in the broader veterinary care industry? What might have been a typical multiple in a pre-pandemic scenario and how might that compare to today?
21.
Following up on what you mentioned about healthy margins, should we think about the multiples expanding vs getting contracted in any way?
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