2022 Annual Shareholders Meeting Prepared Addresses

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19 July 2022

2022 Annual Shareholders Meeting Prepared Addresses


Third Age Health Services Limited (NZX: TAH) holds its 2022 Annual Shareholders Meeting today, 19
July 2022 from 4pm.

During the meeting the following prepared addresses will be given by the Chair, Bevan Walsh and
the CEO, Tony Wai.




Bevan Walsh
Chair


Attached.

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Third Age Health Chair’s address, presented by Bevan Walsh.

It is my pleasure this afternoon to cover some of the highlights of the 2022 financial year.

We are delighted to celebrate our first full year since listing Third Age Health in February 2021 and it
has been heartening to see a number of additional new shareholders recognise the value of the
business. It’s great to have you onboard.

Over the past year the Board has been focused on ensuring we have the right strategy and
leadership in place to take advantage of the growth opportunities that exist in the sector and that
we continue to drive return of value to our shareholders.

We welcomed Tony Wai in late 2021 as the new CEO of the business. His extensive sector
knowledge is already bearing fruit with additional general practice acquisitions and the delivery of a
new strategy to establish a platform for sustainable growth.

Tony has also assembled a skilled and knowledgeable team and it has been encouraging to see the
progress they have made, in a short time, to ensure we are delivering agreed business objectives.

A key focus has always been to ensure we continue to grow our national footprint and to that end, it
was fantastic to see the addition of seven new aged care facilities come on as clients in Taranaki, this
is a new region for us and adds to our geographical spread.

As was signalled at last year’s AGM the acquisition of general practices is a key element of our
strategy to build a firm base from which to offer quality healthcare services to both aged care
facilities and local communities.

In the 2022 financial year we added two new practices in Auckland: Belmont Medical Centre and
Ponsonby Medical Centre. Just after the close of our financial year on 31st March we also acquired
Devonport Family Medicine, on Auckland’s North Shore.

As announced on 30 May we secured a $3 million loan facility to support our acquisition
programme. We continue to look for opportunities and partnerships in the sector which will add
value to the business and returns for shareholders.

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As a business we aim to produce excellent results for the cash employed in the business.
There would be plenty of companies out there who use a lot of capital to produce a relatively small
result, whether it is because of a choice of industry or management behaviour, for instance that
does not involve a question of return and its timeframe before each expense is incurred.

As a business we think very carefully about how cash is used, aiming to be efficient capital allocators,
to produce the results that investors want. I can tell you that Third Age Health is not interested in
just having things that seem to be normal for a “proper” company – the team are focused on
efficiency and resourcefulness.

Whenever we think about incurring any expense, we think about what return it will create, and over
what timeframe. It is accepted that sometimes there are expenses that are incurred because they
are necessary to ensure we are delivering a quality healthcare service for our patients and clients,
this is absolutely right as a trusted healthcare provider, and for our reputation, which will ensure the
business continues to be able to grow. All the more reason why our default approach is to ask the
question before agreeing to an expense: “what result will it produce, and when will that be seen?”.

As you will have noticed, we are focused more than ever on investments to increase our clinical
innovation, communications, and operational efficiency. These all amount to improvements in
quality, and are essential to ensure we remain at the forefront of delivering a healthcare service that
meets the needs of our patients, is very attractive to our customers, and ensures we strongly attract
our expert clinical workforce; who are essential to continued growth.

There are exciting times ahead for Third Age Health as we operate in a sector which will see
continued expansion due to a growing aged population, and we are grateful to our shareholders
who share this vision.

We have some Board changes that I want to walk you through: Under NZX Listing Rules, two of our
team are required to stand for re-election at this AGM. They are Norah Barlow, and John Fernandes.

Both are important to Third Age Health. As Chair, I have observed time and again that Norah, coming
from her work deeply in the core sector we serve, Aged Residential Care, will tell the Board things

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that are insightful about her experience as a customer, and her experience as an aged care sector
CEO. She is a voice of wisdom in the area of the experiences of ARC providers, and in business
generally.

John applies his deep experience in the New Zealand listed company environment and also of his
intense interest in and study of business and shareholder interests and is a fearless communicator.
Coupled with Tony’s deep primary healthcare sector knowledge, which you’ll be sure to become
more aware of today, I am excited about our new Chair and CEO team.

As founder, I regard it as vital to Third Age Health’s interests that we vote in favour of both John and
Norah continuing as directors now.

We also have two other matters to vote on, one - auditor fees is fairly self-explanatory but the other,
the directors fee pool, could use a little elucidation.

We have one director stepping down who has been experiencing some health issues – Diane Budres.
Diane was initially a board-appointee. NZX Listing Rules therefore caused the director fee pool to
automatically increase by, in essence, the amount of the shareholder-approved base fee per
director, so that we could pay her.

On her departure, the fee pool would ordinarily reduce to the original level, but to pay people
appropriately to their responsibility, and in our regard fairly, a vote for the fee pool to be reset is
necessary and has been put forward.

We have two directors taking on more responsibility than they have now – one stepping up to the
Chair of the Board role and the other, to replace him as Chair of the Audit Committee.

On approval of the fee pool of $180,000pa, it is intended that all directors be paid the same amount
as a base (the already-approved allowance of $35,000pa) unless they are also serving on or chairing
a committee, or are serving as Chair of the board, in which case they’ll be remunerated for that
additional responsibility.

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In presenting the resolution to fix the directors pool at this year’s shareholder meeting I wish to
highlight that despite the current allocation of $35,000 fee pool for me (which will not change as a
result of the resolution passing), during the year ended 31 March 2022 both Diane Budres and I
volunteered to accept only $12,000pa, with the remainder on a contingent basis. I have now agreed
with the Board to withdraw from that voluntary arrangement and receive the same full directors fee
of $35,000pa in line with the other directors. This does not change the fee pool at all.

The fees allowed for are: $60,000pa to the Board Chair, $35,000pa for all other directors, $10,000pa
for Audit Committee Chair and $2,500pa for committee members. We have only one committee. We
look forward to your approval.

In closing I want to say a very special thank you to my fellow Board members for their committed
support as directors. I am sad that Diane has experienced some real health challenges lately. I
cannot say enough for the effort that she has put in, despite being stuck out of NZ and having health
issues. Diane, as we know, steps down at the end of this meeting and we wish her a full recovery.

As to myself, after serving almost nine years as Chair, I will hand this role to John Fernandes, at the
end of this meeting. He has been a director of the company since 2019, has served as our first Audit
Committee Chair, and has done so much more for the company than these roles imply.

John pours his energy and expertise in multiple areas into the company and, knowing his strengths,
it is gratifying to me as a shareholder that he is our new Chair of the Board.
I appreciate Wayne Williams stepping up to Chair the Audit Committee, as that role can’t be
performed by the Board Chair, under listing rules. We have observed Wayne’s clarity of thinking and
questioning ever since he joined, and I’m happy with the choice of him for this work.

I look forward to remaining an active Board member, supporting John, Tony and our team.
I will now hand over to Tony who will update you on operational matters.

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Third Age Health CEO’s address, presented by Tony Wai.

Thank you to all our Shareholders who have joined this afternoon.

At last year’s AGM I had only recently been appointed CEO; commencing the role mid-October. My
first six months have flown by with a rejuvenation of the team, a refreshed strategy in place,
planning for the future and delivering on growth. I have been inspired by the passion and
commitment of our team across all our businesses.

It was very pleasing to end the FY22 with an improved profit over and above the previous year. This
was despite challenges of the ongoing pandemic, rising costs and workforce pressures. Total
revenue increased 7.5% year-on-year to $5.9M, which was largely driven by the strategic acquisition
of a community general practice, which saw a 61.4% growth in GP revenues. Our established general
practice, Hawkes Bay Wellness Centre, recorded revenue growth of 23.5% for the year of $0.9M up
from $0.7M in FY21.

Revenue from services to Aged Residential Care facilities was in line with the prior year. Workforce
shortages of General Practitioners and Nurse Practitioners constrained progress on potential
greenfield locations. We also had one client move services in-house, which was offset by the
addition of a number of new ARC clients in Taranaki, which we began providing services for after the
end of the FY22 financial year. Taranaki is a new market for us and therefore expands our
geographical reach.

We were also delighted to add two additional general practices to our portfolio in the 2022 financial
year with the acquisition of Belmont Medical Centre in October 2021 followed by Ponsonby Medical
Centre on 31 March 2022.

When I commenced in the role, I conducted a deep-dive business review of our operating model and
looked at sector opportunities to identify how we best return value to shareholders and improve our
care for older people.

Although Third Age Health had experienced significant growth since inception the changing
healthcare landscape had created issues for developing sustainable growth for the company. This

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has warranted some immediate changes to our operations and investment to put us on to a stronger
platform.

Alongside investing in our systems and personnel we are focused on two pathways for further
growth over the short to medium term. Firstly, it is to increase our ARC service share across the
country – which includes extending our geographical reach as well as building further resilience in
existing regions we operate in. Secondly, it is to expand our offer to older people in the local
community and those living independently in retirement villages.

Acquisition of small to medium sized local general practice clinics plays an essential supporting role
in this as they provide an anchor for our clinical team and a hub from which to increase the number
of services offered to residents in surrounding aged care facilities and independent retirement
village settings.

Our growth strategy is supported by attractive sector dynamics with an aging population, an
increasing need for quality care and escalating demand for qualified clinicians specialising in
providing care for older people.

Having the right people onboard, who have the skills and expertise is essential. This has been
reflected in an increase in total expense growth, that is in line with planned investment and one-off
and non-recurring expenses during FY22 which reflect this period of reset. It’s worthwhile noting
that FY22 expenses also include a full year of listed company and governance costs following our
listing in February 2021.

Our newly refined strategy has four pillars which support our business model, these are workforce
and capability, clinical efficiency and quality, commercial sustainability and growth and health
innovation. Health cannot continue to operate where there are not enough clinicians to manage the
care of a growing group of New Zealanders who need it. Our focus will be to deliver care in a
different way that fulfils the needs of patients and increases the reach of our clinical teams. I am
pleased to say we are already making good progress on initiatives under each of these areas.

Whilst market size will continue to grow with an increasing aged population, we also need to be
thinking very differently about the value we provide to ensure we continue to deliver exceptional

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results for the patients who are enrolled with Third Age Health as their primary care provider, our
aged care clients, as well as our shareholders.

We need to keep in mind that we are in the healthcare business and providing quality care should be
a key determinant of success, this is our responsibility and an expectation as a healthcare provider.
Many of us will have aging parents or relatives and may have experienced some of the difficulty in
seeking and receiving quality care. We ourselves will one day require trusted primary healthcare that
is sensitive to the challenges older people face to maintain quality of life.

Third Age Health is in the unique position of being one of the only companies focused on the
primary healthcare needs of older people. With input from our newly established Clinical Advisory
Committee, which includes some of New Zealand’s foremost thought leaders and experts in older
people’s health, we can develop a truly integrated model of healthcare which helps people to
transition from the community into aged residential care and to also support the health of people
living independently.

New Zealand has an aging population with the number of people over the age of 65 expected to
double in the next 25 years; an estimated 1.5M people by 2048. Third Age Health is well placed to
respond to this growing market.

As well as increasing market share to grow revenue, efficiencies are a key focus for us in delivering
value. We are utilising new digital tools and building virtual capabilities to enhance our clinical
services and optimise delivery of care - this will also help us scale to meet demand.

We are not immune to the health workforce shortages that currently exist in New Zealand and are
echoed globally. We have plans in place to attract and retain our valued clinical team. They will
always remain an essential element of our business.

We have big aspirations, a clear strategy, and a great team in place. Our focus remains on our key
drivers: increasing patient enrolments; developing new services in our family of general practices
and contracted aged care facilities; acquisitions of primary care medical centres to provide a hub for
local aged care clients and lastly ongoing business improvements.

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To you, our shareholders, thank you for your continued backing of Third Age Health.
Thank you

[END]