Olympus Corp. · TSE:7733
Olympus — 40th Annual J.P. Morgan Healthcare Conference 2022
41 slides from Olympus's conference presentation, Jan 10, 2022
Slide 1: A New Horizon
A New Horizon Yasuo Takeuchi, President and CEO 40th Annual J.P. Morgan Healthcare Conference January 10, 2022
Slide 2: Disclaimer
Disclaimer This material contains forward-looking statements that reflect management’s current views, plans, and expectations based on information available at the time of preparation. These forward-looking statements are not guarantees of future performance and involve known and unknown risks, un
Slide 3: Opening Remarks; Performance Highlights and Strategic Outlook; Three Guiding Principles
01 Opening Remarks 02 Performance Highlights and Strategic Outlook 03 Our Three Guiding Principles: Focus, Shape and Enable
Slide 4: Opening Remarks
01 Opening Remarks
Slide 5: We will continue to make people's lives healthier, safer, and more fulfilling
We will continue to make people’s lives healthier, safer, and more fulfilling.
Slide 6: Performance Highlights and Strategic Outlook
02 Performance Highlights and Strategic Outlook
Slide 7: We set challenging targets
We set challenging targets Sustain 5-6% growth annually To become a leading global medtech company contributing to people’s lives by delivering Deliver> 20% consolidated corporate operating margin* innovative solutions that benefit patients, healthcare professionals, payors and providers Become a le
Slide 8: We adopted an ambitious timeline out to FY2023
We adopted an ambitious timeline out to FY2023 We aim to unleash our potential by developing the organizational focus, operational structure and employee mindset needed for long-term, sustainable growth. FY2023 is a milestone, not our goal. 3 Years Compete to Grow Transform to Perform To capture gro
Slide 9: We continue to reform and have achieved much
We continue to reform and have achieved much Joined Task Force on Climate-Related Financial Disclosures (TCFD) in May 2021 ESG Ranked in DJSI World Index since November 2021 Completed transfer of the Imaging business Portfolio Invested resources in Therapeutic Solutions Division Engaged in
Slide 10: Our operating margin improved significantly
Our operating margin improved significantly Operating margin significantly improved due to execution of various transformations Right on track to achieve >20% in FY2023 FY 2023 TARGET FY 2020 ACTUAL FY 2021 ACTUAL FY 2022 FORECAST Adjusted >20% 13.5%¥102.1 14.1% ¥103.1 18.9% ¥161.5 OP margin* Billio
Slide 11: We have a stable and sustainable capital allocation policy
We have a stable and sustainable capital allocation policy Prioritize allocation to business investment Stable and gradual dividend increase Flexible buyback of treasury stock Prioritize: Prioritize Business Investment for profitable, organic growth Investment Strategic investment for growth opp
Slide 12: Today, we stand on a Solid Foundation
Today, we stand on a Solid Foundation.
Slide 13: Our impact on patients' lives is already substantial
Our impact on patients’ lives is already substantial 100 TOP 4 Diseases or Conditions Treated Cancers Treated At Olympus we have versatile medical devices Olympus provides products/solutions for with the ability to treat approximately lung, stomach, colon and prostate cancers, 100 diseases or condit
Slide 14: Chronic diseases are increasing as the population ages
Chronic diseases are increasing as the population ages 25% 20% 2020 2040 15% 19.3 30.2 10% 5% 0% Million Million 1950 2000 2050 2100 Percentage of population over 65 Long-term rise in Estimated increase in share of population new cancer cases from over 651 2020 to 20402 Source: 1 United Nations, Dep
Slide 15: New technologies are revolutionizing our industry, particularly digital technologies
New technologies are revolutionizing our industry, particularly digital technologies Over the next five years, digital health solutions are expected to represent a rising percentage of leading medtech companies' revenues. And will result in substantial cost reduction by 2030 Digital maturity of the
Slide 16: Expectations for patient care are shifting
Expectations for patient care are shifting Care pathway enhancement Benefits Emphasis on driving value by supporting personalized care through for patients comprehensive understanding and management of diseases Tailored care Faster service Lower expenses Better outcomes x Benefits for HCPs
Slide 17: To lead, medtech companies must go beyond best-in-class devices
To lead, medtech companies must go beyond best-in-class devices Current state: Outcomes driven Future state: Outcomes driven by the by performance of individual ability to optimize the care devices at discrete points of the pathway for an individual patient patient journey based on their unique need
Slide 18: We aim to improve patient outcomes by elevating the standard of care
We aim to improve patient outcomes by elevating the standard of care in targeted disease states. Focus Shape Enable Focus on the disease Shape the future by Enable our states on which investing in new ways organization to better we can have a market- to enhance the execute globally and leading impac
Slide 19: Our Three Guiding Principles: Focus, Shape and Enable
03 Our Three Guiding Principles: Focus, Shape and Enable
Slide 20: Improve patient outcomes by elevating the standard of care
Improve patient outcomes by elevating the standard of care in targeted disease states Focus Shape Enable Focus on the disease Shape the future by Enable our states on which investing in new ways organization to better we can have a market- to enhance the execute globally and leading impact standard
Slide 21: We will focus on disease states where we can have a market-leading impact
We will focus on disease states in specialties where we can have a market-leading impact GI Urology Respiratory Market Size GI Endoscopy GI Endotherapy Market Size Market Size ¥350-370 ¥300-350 ¥280-350 ¥60-80 billion billion billion billion Market CAGR Market CAGR Market CAGR Market CAGR 4-6% 5-7%
Slide 22: Our GI growth drivers
Our GI growth drivers Maintain Digital EVIS X1 imaging Single-use EndoCuff Next Gen Metal leadership with scope solutions like cholangioscope Vision hemostasis stents new launches additions CADe/x devices Grow by regional Prepare EVIS X1 Drive professional Further go-to-market education initiatives
Slide 23: Our urology growth drivers
Our urology growth drivers Soltive launch Global expansion Procedural ownership Drive continued growth of Leverage Soltive Enable procedural Drive market share through the differentiation to expand ownership through lithotripsy Olympus’ comprehensive launch of the Soltive continued innovation in las
Slide 24: Our respiratory growth drivers
Our respiratory growth drivers Launch EVIS X1, our Deliver a comprehensive Innovate with new Maintain leadership next generation single-use and traditional EBUS technologies in core markets with bronchoscopy bronchoscopy portfolio that address unmet technical innovation platform, in the US to addres
Slide 25: Improve patient outcomes by elevating the standard of care
Improve patient outcomes by elevating the standard of care in targeted disease states Focus Shape Enable Focus on the Shape the future by Enable our diseases on which investing in new ways organization to better we can have a market to elevate the standard execute globally and leading impact of care
Slide 26: We will shape the future by investing in new ways to elevate the standard of care
Technical innovation in imaging, diagnostics, and therapeutics We will shape the future by investing in new ways to Care Pathway Enhancement elevate the standard of care Harness technologies and new business models that serve the patient in new ways Procedure Optimization Next-Generation Product Inn
Slide 27: We will offer the optimal range of endoscopes
Durable and reliable Best We will offer the optimal Improves workflow visualization range of endoscopes Important value Our near-term aim is to offer statements from clinicians the right endoscope, be it in-depth market Compatible research study1 High reusable or single-use, for every with existing
Slide 28: Single-use endoscopes will complement our portfolio
Single-use endoscopes will complement our portfolio Dedicated single-use endoscope unit established in April 2021 We have established a strategic approach to single-use endoscopy that is: • Consistent with market needs • Aligned with our position as an endoscopy partner of choice Growing market for
Slide 29: Improve patient outcomes by elevating the standard of care
Improve patient outcomes by elevating the standard of care in targeted disease states Focus Shape Enable Focus on the Shape the future by Enable our diseases on which investing in new ways organization to better we can have a market to enhance the execute globally and leading impact standard of care
Slide 30: Our business development team and tools are tailored to complementary, inorganic growth
Our business development team and tools are tailored to promoting complementary, inorganic growth Corporate Set-up Achievements venture capital Set-up teams in 7 locations and Key therapeutic areas strengthened through Launched US-based fund with $50 established processes and tools for a series of r
Slide 31: Stronger Medical and Scientific Affairs will enhance our portfolio
Stronger Medical and Scientific Affairs will enhance our portfolio's clinical relevance, economic value and safety >20 3x Value Medical Training Through experts hired attendance* data Strengthen Olympus’ Develop and implement Leverage real-world functional capabilities to educational programs and ev
Slide 32: We are further enhancing our capabilities for growth
We are further enhancing our capabilities for growth Procurement, Research and Quality assurance supply chain and development and regulatory manufacturing affairs Globalize the manufacturing and Deliver innovative and patient- Put patient safety at the core of repair, supply chain, and outcome orien
Slide 33: A broadened Executive Committee will help us meet our aims
A broadened Executive Committee will help us meet our aims FY2022 Yasuo Takeuchi Nacho Abia Stefan Kaufmann Chikashi Takeda Akihiro Taguchi Director, Representative Executive Officer, Director, Executive Officer, Executive Officer, Executive Officer, Chief Operating Officer Executive Officer, Chief
Slide 34: We are fully committed to achieving our aspirations
We are fully committed to achieving our aspirations and strive for further revenue and profitability growth acceleration We aim to improve patient outcomes by elevating the standard of care in targeted disease states. After FY2024, we will target revenue growth, improving cost leverage and balance s
Slide 35: OLYMPUS
OLYMPUS
Slide 36: Appendix
—— Appendix
Slide 37: Adjustment items
Adjustment items Operating Profit / EPS* Exclude “Other income/expenses**” No adjustment will be made for the impact of exchange rate fluctuations; actual exchange rates will be used. ROIC* Exclude “Other income/expenses**”, “Amortization of intangible assets from M&A***” from NOPAT****. Exc
Slide 38: Financial indicators (no adjustment)
Financial indicators (no adjustment) FY 2023 TARGET FY 2020 ACTUAL FY 2021 ACTUAL FY 2022 FORECAST OP margin* >20% 12.2% 11.2% 16.8% Financial guidance FCF growth >20% -% -92.7% -17.8% CAGR from FY2020/3 ¥71.1 ¥5.2 ¥48.0 Supporting financial Billion Billion Billion indicators ROIC >20% 9.4% 3.1% 13.
Slide 39: Adjusted supporting financial indicators
Adjusted supporting financial indicators FY 2023 TARGET FY 2020 ACTUAL FY 2021 ACTUAL FY 2022 FORECAST Adj. FCF growth >20% -% +11.6% +6.1% CAGR from FY2020/3 ¥71.1 ¥79.4 ¥80.0 Billion Billion Billion Adj. ROIC >20% 10.7% 10.3% 16.0% Adj. >25% -% +37.2% +43.9% EPS growth* CAGR from FY 2020/3 ¥45.49
Slide 40: Composition of total revenue and sub-segment ratio within ESD/TSD
Composition of total revenue and Sub-segment ratio within ESD/TSD Other Medical Service 1%(¥9.2B) 30%* Scientific Solutions Endoscopic 13% (¥95.9B) Solutions ESD GI Endoscopy 54% ¥393.7B 55%* FY2021 Medical Surgical Endoscopy 15%* Total Revenue Business 86%(¥625.5B) ¥730.5B Other Therapeutic Areas 2
Slide 41: OLYMPUS Investor Day 2021 (Dec 7, 2021)
OLYMPUS Investor Day 2021 (Dec 7, 2021) Please visit the following URL for more details on the Investor day 2021 Presentation Materials https://www.olympus-global.com/ir/data/pdf/Olympus_Investor_Day_PPT_Presentation_e.pdf Presentation Materials with script https://www.olympus-global.com/ir/data
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