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Table of Contents. GCC Healthcare Sector Dynamics Key Factors behind Healthcare Investment Post-Investment Revenue Growth Drivers Healthcare Investment - Key Challenges . 1. GCC Healthcare Sector Dynamics . … Fast Growing Population. … And High Life Expectancy . Fast Growing Economy.

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    1. Table of Contents GCC Healthcare Sector Dynamics Key Factors behind Healthcare Investment Post-Investment Revenue Growth Drivers Healthcare Investment - Key Challenges

    2. 1. GCC Healthcare Sector Dynamics

    3. … Fast Growing Population … And High Life Expectancy Fast Growing Economy … With High Purchase Power GCC Healthcare Sector Dynamics Strong Macroeconomic Fundamentals GDP Growth (2013e) GDP Per Capita 2013e (US$) With a fast growing economy, a rapidly expanding population, a very high purchasing power and high life expectancy, the GCC region offers excellent macroeconomic and demographic growth factors Population Growth 2013e Life Expectancy 2013e Sources: The World Bank, IMF World Outlook 2012, CIA Factbook

    4. Scarcity of Healthcare Infrastructure High Demand for Medical Professionals Significant Growth Prospects Increasing Sedentary Lifestyle Diseases GCC Healthcare Sector Dynamics Dynamic Healthcare Sector with Significant Growth Prospects GCC Healthcare Market Size (US$ bn) Diabetic Population as % of Total Population in the GCC (2012) CAGR : 11.4% With increasing sedentary lifestyle diseases, a non-adequate medical infrastructure, and a shortage of medical professionals, healthcare sector in the MENA region offers tremendous growth opportunities in the near future Shortage Of Medical Professionals in the GCC (2012) Hospital Beds Per 10,000 Population Sources: Al Masah Capital Research, Industry Reports

    5. 2. Key Factors behind Healthcare Investment

    6. Key Factors Driving Healthcare Investments Defensive Sector with Lower Risk • Defensive sector with lower volatility • One of the most resilient sectors during economic slowdown phases High Growth Prospects • High and growing purchase power • Fast-growing population • Increasing life expectancy • Increasing sedentary lifestyle and chronic diseases (e.g.: Diabetes) • Regulatory shift towards mandatory health insurance • Scarcity of healthcare infrastructure Healthcare presents attractive opportunities for investors. The strong demand, the supply scarcity and the supportive regulatory environment currently make the sector an excellent business case High Profitability • High net profit margins: • Medical centers and polyclinics: 20% to 30% • Diagnostic centers: 30% to 40% • Specialized centers (Infertility, cancer, etc.): 30% to 40% • Large hospitals: 10% to 20% • Pharmacies: 10% to 20% Strong Financial Market Appetite • Healthcare players listing offerings constantly oversubscribed • Listed healthcare players trading at high valuations (P/E: 23.3x) Low Capital Intensity • Lower investment required compared to other sectors (industry, hospitality, etc.)

    7. 3. Post-Investment Revenue Growth Drivers

    8. [Enter Text Here] Key Factors Driving Healthcare Investments Services • Extending opening hours • Opening new lines of business Healthcare Investment Revenue Growth Insurance • Increasing insurance network to attract a wider patient base • Increase agreed prices with insurance companies Long Term Strategy • Establish a long term strategy and implement the right action plan to fulfill the objectives Market Positioning • Ensuring optimal market positioning to best serve the targeted patient base Brand Development • Establish a recognizable and trustworthy brand in the market through targeted marketing campaigns Human Resource Optimization • Enhancing human resource utilization and inefficiency reduction, particularly with investors managing large existing networks

    9. 4. Healthcare Investment - Key Challenges

    10. [Enter Text Here] Healthcare Investment - Key Challenges [] • Healthcare infrastructure in the GCC lags international standards • Given patients’ strong demand and high income per capita, the lag of high quality healthcare services restrains the market from growing at the appropriate pace Lack of Quality Healthcare Infrastructure • GCC Governments are spending considerable amounts to sponsor medical treatments abroad for their citizen which affects market growth in the region Government Sponsorship of Citizen Treatment Abroad • Most GCC countries show much lower healthcare workforce ratios than developed countries • Lengthy and complex licensing processes also contribute to the staff shortage Shortage of Qualified Medical Staff • The increase in healthcare insurance coverage leads to higher receivables and requires healthcare providers to adapt to the transition from cash to insurance operations • Increasing insurance revenues require larger teams to manage claim submissions and receivable collection Cash Flow Management • Insurance companies are gaining power due to the increase in medical insurance coverage and increasing insurance pricings to match the escalating cost of providing healthcare services is a challenge Increasing Pressure on Insurance Prices