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Article Excerpt
UNIDENTIFIED SPEAKER: Excellent. Our next presentation is Andy Rieth. Andy is the Vice President of Investor Relations, Communications and Global Brand at Hill-Rom.
ANDY RIETH, VP, IR, COMMUNICATIONS & GLOBAL BRAND, HILL-ROM HOLDINGS, INC.: Good morning, everyone, and thank you for the invitation to be here.
Hill-Rom is probably not a name that a lot of you are terribly familiar with. At about $1.4 billion-$1.5 billion in revenues, we may just be the largest medical technology company that no one's ever heard of, but we'll see if we can address that a little bit today.
Here's a little bit of a history of the Company. We were originally founded back in the depression era as a hospital furniture company. But big breakthroughs in the development and evolution of the Company came about when, first, in 1985, we entered the therapy side of the business, adding to the frame systems that we have, therapies to deliver wound management care and that type of thing. That was acquired or that was developed through acquisition. We continue to focus on therapy development and therapy kinds of concentration.
The next big milestone I'll highlight is in the 2005-2006 timeframe when, really, we decided to have an entirely new management team come in to really revitalize Hill-Rom. At that time, we were a sister company to Batesville Casket, in a very somewhat counter-cyclical business to our own, as part of a parent company called Hillenbrand Industries.
At that time, Hill-Rom had been fairly stagnant in it's growth profile and we felt that it was important to unlock the opportunity for the Medical Technology side of that business. So Peter Soderberg was brought in, having spent 23 years with Johnson & Johnson in the medical technology side of the business, generally. And also having spent about 12 years leading the Welch Allyn Company and in various leadership positions, including CEO of that for the final six years of that tenure.
So he came in 2006, along with several of us from the medical technology business, developing a new strategy that we've been really executing since the fall of 2006, early 2007. I'll talk a little bit more about that strategy shortly.
And then the next big milestone that I will bring to your attention was our separation and spin in about a little less than a year ago, where we spun out the Batesville Casket Company and become a stand-alone med-tech company trading as Hill-Rom Holdings, HRC on the New York Exchange.
So, as you can see, we are about a $1.5 billion in revenues, 6,000 - close to 7,000 - employees on a worldwide basis and really, on a revenue basis, probably a top-30 kind of peer-play medical technology company. Our latest milestone is the acquisition of Liko in October of 2008 and I'll spend a little time on that shortly.
You can look at our healthcare revenues really in three different ways. You'll see here in this slide three separate cuts. On a reported business segment basis, we have about 62% - these are 2008 actual revenues - that is focused on North America acute care sales and that is obviously sales to hospitals in the North America segment.
Number two, we have an international segment at 25% of our revenues. Again, that's focused principally on the acute care portion of the hospital segment, but there are some post-acute sales there as well.
And then the third and smallest piece, but one of the fastest-growing pieces, is our entry into the post-acute segment. Again, these are a variety of extended care, rehabilitation hospitals, nursing homes and even the home environment and we're very excited about that. I'll speak a little bit about that when I review our strategy.
Another way that you can shape our business and describe our business, which is unique and differentiated, is that about a third of our business is derived from rental of product. This is rental of proprietary...
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