22 slides from Krka, D. D., Novo Mesto's earnings presentation, Jul 20, 2023
Slide 1: Krka Group Business Performance Webcast H1 2023 Results
Krka Group Business Performance Webcast H1 2023 Results David Bratož, Member of the Management Board Brane Kastelec, Finance Director 20 July 2023
Slide 2: H1 2023 Highlights
Krka Group Business Performance H1 2023 Highlights SALES 5Y CAGR: 6.2% ✓ Sales in H1 2023 accounted to €920.4m; +7% yoy In 857 920 ✓ Maintaining strong profitability, net income affected by FX EUR 759 802 807 million ✓ Net profit amounted to €170.1m; -28% yoy 1-6 19 1-6 20 1-6 21 1-6 22 1-6 23 ✓ Sal
Slide 3: Well-Diversified Activities
Well-Diversified Activities Providing access to high quality affordable medicines Krka‘s presence on 70+ markets in 6 sales regions 49 subsidiaries outside Slovenia: 55+ million patients daily use Krka‘s 45% of all Krka Group workforce medicines worldwide 17 bn FDF produced annually in various Sales
Slide 4: Long-term Stable Operating Business Growth
Long-term Stable Operating Business Growth Revenue rising along with manufacturing output THE BIG 5 Pieces sold CAGR (2005–2022) 6.9% over 1b in Sales revenue CAGR (2005–2022) 7.4% sales volume Global pharma market CAGR (2005–2022) 5.6% 18 Net income CAGR (2005–2022) 10.0% 1,600 Manufacturing output
Slide 5: Krka Group Sales by Regions
Krka Group Sales by Regions Continuation of good sales dynamics ❖ Largest market: Russian Federation Sales: EUR 180m; +4% yoy H1 2023 sales: EUR 916.5 million of goods 167 180 168 173 180 In and services; (+7% yoy; EUR +63.0m) EUR million H1 19 H1 20 H1 21 H1 22 H1 23 Central Europe ❖ 2nd market Pol
Slide 6: Broad Product Portfolio
Broad Product Portfolio Sales by products and service groups in H1 2023 Pain relief represents almost 6% share in Other Rx Diversified product 19% portfolio Rx Other Rx CVS: CNS: 12% statins and other 56% CVS antidepressants, hypolipemics, ACE Gastro antipsychotics, anti- 12% inhibitors, sartans, ot
Slide 7: Research and Development
Research and Development Committed to continuous development of innovative branded generic products 5 new MA for products in H1 2023 Strategic R&D target ≈ 10% of sales Obtained 263 marketing authorizations for existing 119 Rx, 3 OTC, and 141 VET products 800 experts engaged in New MA in H1 2023: R&
Slide 8: Krka's Innovative Medicines
Krka’s Innovative Medicines Innovative branded generic producer with own R&D ADVANCED UNIQUE STATE-OF-THE-ART UNIQUE PHARMACEUTICAL SINGLE PILL MORE THAN EQUIPMENT STRENGTHS FORMULATIONS COMBINATIONS Delivering the most demanding Great possibility of Tailoring the Synergistic action & 100 projects i
Slide 9: Investments
Investments Strengthening the resilience and flexibility of our business model Notol 2 – Slovenia CAPEX H1 2023: €45.7m; FY 2023 plan: €130m Aiming the investments predominantly for increasing and technologically upgrading production facilities and capacities for development and quality management.
Slide 10: Consolidated Income Statement
Consolidated Income Statement Maintaining high profitability -5% EUR thousand H1 2023 (%) H1 2022 (%) YoY 722,438 Revenue 920,430 100 857,443 100 7% 686,802 Costs of goods sold 376,698 423,756 -11% Gross profit 543,732 59 433,687 51 25% 423,756 376,698 Other operating income 2,605 0 3,945 0 -34% 49.
Slide 11: Consolidated Statement of Financial Position
Consolidated Statement of Financial Position Strong financial position without leverage burden EUR thousand 30.6.2023 (%) 31.12.2022 (%) change change % ASSETS 2,766,951 100 2,687,500 100 79,451 3% Non-current assets 1,037,557 37 1,125,025 42 -87,468 -8% Current assets 1,729,394 63 1,562,475 58 166,
Slide 12: FX Volatility Affecting Krka's Bottom Line
FX Volatility Affecting Krka‘s Bottom Line FX impact on net financial result (NFR) by quarters H1 NFR H1 NFR 180 EUR m Year 2022 +138 EUR m Year 2023 –29 EUR m 160 140 160 139 H1 2023 RUB vs. EUR -19.6%. 120 120 100 80 80 40 Q1 Q2 Q3 Q4 Q1 Q2 60 0 40 -40 -2 -15 -71 -14 -15 20 -80 0 Jan 22 Feb 22 Mar
Slide 13: Krka Group Operating Results
Krka Group Operating Results Maintaining high profitability Profitability Margins development 70% EUR million H1 2023 H1 2022* yoy 59% 59.1% 60% 57% 57% 57% EBITDA 288.6 270.1 7% EBITDA margin 31.4% 31.5% 50% EBIT 236.2 217.0 9% 40% 33% 31.4% EBIT margin 25.7% 25.3% 30% 29% 30% 26% 25% 25.7% Net pro
Slide 14: Performance Indicators
Performance Indicators Long-term focus Sales in € million EBITDA in € million 5y average (2018-2022) EBITDA margin: 28.5% 2,000 700 1717 1755 584 1535 1565 600 1489 1,500 502 488 500 464 385 920 400 1,000 289 300 500 200 *5Y CAGR 5.7% 5Y CAGR 9.7% 100 0 0 2019 2020 2021 2022 H1 2023 2019 2020 2021 2
Slide 15: Dividend Policy and Share Buyback
Dividend Policy and Share Buyback Management committed to stable capital allocation DPS and dividend yield* for the business year Treasury shares as of total dividend confirmed by AGM New share buy-back programme initiated on July 20 7.00 7.0% 8.0% 6.00 10Y CAGR 15.2% 6.0% 5.00 5.0% 6.0% 5.4% 5.6% 5
Slide 16: Share Information and Shareholder Structure
Share Information and Shareholder Structure Stable shareholder structure (KRKG SV) Average daily turnover and stock price YTD Largest shareholders as of 30 June 2023 EUR 1,200 120 1,000 746 759 100 800 EUR thousand 653 20.6% Individual Slovenian investors 600 517 80 40.8% Slovenian institutional inv
Slide 17: ESG Governance of Krka Group
ESG Governance of Krka Group Adopting ESG policy & ESG goals Material ESG Topic Groups essential for long-term Strategic activities: operating success of the Krka Group ✓ ESG policy adopted by the management board & 1 Product quality & patient safety supervisory board is Krka's strategic document on
Slide 18: Sustainability Is Important Part of Krka
Sustainability Is Important Part of Krka Selected ESG metrics & KPIs E – Environmental G – Governance ✓ Quantity of packaging materials reduced by 42 tonnes thanks to ✓ Management and governance of the company in accordance with returnable packaging system with our supplier highest standards of corp
Slide 19: Forward Outlook
Forward Outlook 2023 guidance and key challenges INTRODUCTION OF NEW 2023 GUIDANCE: PRODUCTS & MANAGMENT OF EXISTING PRODUCTS LIFE CYCLE Sales €1,755m Net income ≈ €300m est. CAPEX: €130m RECORDING PATIENT NEEDS & REQUIREMENTS STRONG MARKETING MONITORING & SALES CLIENT Key risks & challenges: NETWOR
Slide 20: Financial Calendar & Contacts
Financial Calendar & Contacts FINANCIAL CALENDAR CONTACTS Date* Time* Thursday, 12 January 2023 Start of silent period Thursday, 26 January 2023 12:00 Release of Preliminary Results for 2022 KRKA IR Team 12:00 Press conference on business performance in 2022 KRKA, d. d., Novo mesto Thursday, 3 March
Slide 21: Living a healthy life.
(%4 KRKK Living a healthy life.
Slide 22: Disclaimer
Disclaimer The information, statements or data contained in this presentation has been prepared by Krka, tovarna zdravil, d. d., Novo mesto (hereinafter: the Company) and has been prepared solely for the purpose of informative presentation of the Company business operations. The presentation is not