GHG at a Glance

The structure of our business

We are the largest healthcare services provider in the fast-growing, predominantly privately-owned, Georgian healthcare ecosystem. We lead the market by offering the most comprehensive range of inpatient and outpatient services and by targeting the mass market segment through our vertically integrated network of hospitals and polyclinic clusters. We are also the largest pharma player as well as the second largest medical insurance provider in the country.

GHG’s market-leading position, its unique business model with a significant growth potential, and its experienced management team make it a compelling investment story. Furthermore, the first class leaders of our medical team are driving the improvement of service quality and access of patients to healthcare across the organisation. These factors, together with the improved access to healthcare services through the Universal Healthcare Programme (“UHC”) financing, enable us to capitalise on the existing service gaps and the overall historically lower quality of medical care in the country.

Market leader

  • The largest healthcare service provider in Georgia: 24.9% market share by number of beds (3,320)2
  • The largest pharmaceuticals retailer and wholesaler in Georgia: 30% market share by sales(3), over 2 million client interactions per month, with 0.5 million loyalty card members
  • The second largest medical insurer in Georgia: 27% market share(4), c.230,000 individuals insured as for February 2019
  • The widest population coverage: coverage of over 3/4 of Georgia’s 3.7 million population(5) with 37 high quality hospitals, 16 polyclinics, and 270 pharmacies
  • Institutionalising the industry: strong corporate governance; standardised processes; improving safety and quality by progressive implementation of the Joint Commission International (“JCI”) benchmarked standards; own personnel training centre.
  • New Mega Lab Completed: High-capacity automated systems will enable GHG to provide accurate, high quality results for the country’s whole population.

Long-term high-growth opportunities

  • Low base: only US$325 healthcare spending per capita(6), only 3.9 outpatient encounters per capita annually(7), only US$40,300 revenue per referral hospital bed for GHG (8)
  • Supported by attractive macro: (9) Georgia–one of the fastest growing countries in Eastern Europe,open and easy emerging market to do business (10),with real GDP growth averaged 4.5% annually in 2007-17. Only 8.7% of GDP is spent on healthcare and spending growing at 11.5% CAGR 2000-2014 (6); government spending more thandoubled between 2011-18(11)
  • Implying the long-term, high-growth expansion that is driven by:
    • Universal Healthcare Program (UHC)
    • Pick-upin polyclinics (outpatient market)
    • Close service gaps 
    • Potential to develop medical tourism

Business model with cost and synergy advantages

  • The single largest integrated player in the Georgia healthcare ecosystem of GEL 3.5 billion aggregate value with a cost advantage due to its scale of operation: purchasing, centralisation of administrative functions
    • The next largest healthcare services competitor has only 5% market share by beds
    • The largest purchaser of pharmaceutical products in Georgia
  • Better access to professional management and high calibre talent
    • One of the largest employers in the country: 15,922 full time employees, including 3,603 physicians, 3,342 nurses and 3,339 pharmacists
  • Referral system & synergies with insurance and pharma business:
    • Presence of patient pathway, and referral synergies
    • Insurance activities provide steady revenue stream for our polyclinics and bolster hospital patient referrals
    • 0.5 million loyal customers in our pharma business with an upside to cross-sell

Strong management with proven track record

  • Strong business management team – an increased market share by beds from under 1% in 2009 to 24.9% currently
  • Robust corporate governance: exceptional in Georgia’s healthcare sector, as it is the only Premium Listed company in the Georgian healthcare industry (LSE:GHG LN) (12); 57% shareholder is Georgia Capital PLC (LSE: CGEO LN) - a UK listed investment company following completion of its demerger from BGEO Group PLC on 29 May 2018. The rest of the shares are owned by institutional investors and management as part of Employee Stock Ownership Plan (ESOP)
  • In-depth knowledge of the local market