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Company Outlook April 1, 2014 Harry Fleming, CFO hfleming@northstar-healthcare.com. Forward Looking Statements.

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company outlook april 1 2014 harry fleming cfo hfleming@northstar healthcare com
Company Outlook

April 1, 2014

Harry Fleming, CFO

hfleming@northstar-healthcare.com

forward looking statements
Forward Looking Statements

This presentation contains forward-looking information (within the meaning of applicable securities laws) relating to the business of Northstar Healthcare Inc. (the "Company") and the environment in which it operates. Forward-looking information may include statements regarding the objectives, business strategies to achieve those objectives, expected financial results, economic or market conditions, and the outlook of or involving the Company and its business. Such forward looking information or statements are typically identified by words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions.

Forward-looking information, including any financial outlooks, is provided for the purpose of providing information about management's expectations and plans about the future and may not be appropriate for other purposes. Forward-looking information herein is based on various assumptions and expectations that the Company believes are reasonable in the circumstances. No assurance can be given that these assumptions and expectations will prove to be correct and the forward-looking information, including the financial outlooks included in this Presentation, should not be unduly relied upon. Those assumptions and expectations are based on information currently available to the Company, including the historic performance of the Company's business. Such assumptions include anticipated financial performance, current business and economic trends, and business prospects and are subject to the risks and uncertainties which are discussed in the Company's regulatory filings available on the Company's web site at www.Northstar-Healthcare.com or at www.sedar.com.

The Company’s management has approved the financial outlooks contained in this presentation.

agenda
Agenda
  • Northstar
  • ASC Industry
  • Revenue/Growth _Programs
  • Financials
  • M&A
  • Investment Highlights
northstar overview
Northstar - Overview
  • Northstar partners strategically with physicians in the development and management of ASCs with the mission of providing superior medical care, increased patient satisfaction, lower costs for healthcare delivery and revenue enhancement through innovative marketing campaigns.
  • NHC is a publicly listed company on the Toronto Stock Exchange (Ticker: NHC), although all of its operations are located in the U.S.
      • Outstanding Shares to date are 43 Million
      • Management Team collectively owns approximately 20 Million shares
      • Institutional Ownership Approximately 25%
  • NHC is in the process of positioning the company so that it can effect a listing on a U.S. exchange such as the NASDAQ or the NYSE during the calendar year 2014. Upon the occurrence of such event NHC will also remain on the TSX as a dual listed company.
focus of our business

Bari,

Spine, DPM

Gyn, Pain

Gen Surgery, Ortho

Outpatient SurgeryProfits

Outpatient Surgery

Inpatient Surgery

X Rays

Labs

Medical Admissions

ASCs better serve surgeons, patients and payors

Hospital Profits

Focus of Our Business
  • Most profitable part of the healthcare delivery system
  • Low costs if well managed
  • Profit margins can exceed 50% on a center level
our locations
Our Locations
  • Own and Operate 4 ASC’s:
    • 2 in Houston
    • 1 in Dallas
    • 1 in Scottsdale
  • Manage Clinical Operations:
    • Spine/pain management
    • Bariatric
    • Podiatry
  • Own and Operate 2 MRI and 1 Urgent Care Centers

Focus: Surgical excellence and maximizing efficient use offacilities and resources

7

our ascs
Our ASCs
  • 18 operating/procedure rooms
  • 150+ surgeons on staff
  • Focus on high allowable and high marginoutpatient surgical procedures
  • 10,000+ cases per year
  • Close to major medical centers

KIRBY Surgical Center

Houston

8

ambulatory surgery centers ascs

Average charges – 33% lower

Ambulatory Surgery Centers (ASCs)
  • Outpatient surgery facilities
  • No overnight stay required
  • Lower cost structure to patient and insurance companies
  • Better patient outcomes and satisfaction
  • Higher physician satisfaction
  • Reduced patient risk factors

10

asc industry overview
ASC Industry Overview
  • Combined revenue of about $18 billion
  • Untouched by Federal Healthcare Reform Act
  • Fragmented market
    • 50 largest companies generate 30% of the revenue
    • U.S. ASC industry includes about 3,500 companies that operate about 5,000 centers
    • 75 independent ASCs in Houston; 350 in Texas
  • High growth expected over next two years, driven largely by patients seeking lower-cost alternatives to hospital care, better clinical outcomes and patient satisfaction, and physician steerage of patient care
u s healthcare trends

More procedures suitable for ASCs

U.S. Healthcare Trends
  • Growth in outpatient surgeries due to Technology and Technique
  • National number of ASC’s has quadrupled in 30 years
  • Over 60% of all U.S. surgeries are as outpatients

12

revenue growth programs
Revenue Growth Programs

Physician Contracting

  • Accretive revenues for ASC
  • Surgeon does not need to purchase equity
  • Northstar’s ownership is not diluted

Direct to Consumer Marketing

  • Current Campaigns:
    • NueStepSM (Podiatric nerve decompression)
    • CuraSpineSM (Spine)
    • Bariatrics
  • Upcoming Campaigns:
    • Peripheral Bariatric Campaigns

14

direct to consumer marketing
Direct to Consumer Marketing
  • Launched first campaign spring 2013
  • Marketing infrastructure
    • Campaign production
    • Call center
    • Media components
    • Online presence
    • Analytics for campaign optimization
  • Clinical Management
  • Lead Management

15

consolidated revenue operating ebitda 000s
Consolidated Revenue & Operating EBITDA* (000s)

*Operating EBITDA is net of non-controlling interest but not including the corporate expense

17

growth formula
Growth Formula
  • Existing Centers
    • Continue to optimize current marketing plans and introduce new marketing programs
    • Project 20% annual growth in revenue
  • Seasonal Revenue: Revenue is seasonal where the first quarter revenues are significantly less than those of the 4th quarter.
  • New Business Development
    • Enter two new markets in 2015 and four markets in 2016;
    • Leverage current marketing campaigns and other revenue generating programs
    • Implement cost containment strategies with increased economies of scale
    • Each market should target $1.9 - $2.5M EBITDA
accelerated growth beyond organic
Accelerated Growth Beyond Organic

Future Acquisition Targets

  • Acquire ownership of local surgical hospital(s) to complement current marketing programs
  • A small-size ASC to service current in-network marketing leads
  • ASC(s) beyond current market area: San Antonio
  • Ancillary healthcare facilities to diversify revenues and develop referrals

20

investment highlights

Strong position in high growth ASC industry

Proven track record of performance

Compelling value proposition for surgeons, patients, and payors

Acquisition environment – accretive and accelerated market entry

Platform for scalable growth into multiple markets

Northstar Healthcare = Significant growth opportunity

Investment Highlights