Venture Life Group Plc · LSE:VLG
Venture Life — H1 2018 Earnings Presentation
32 slides from Venture Life's earnings presentation, September 2018
Slide 1: The partner of choice for self-care products
The partner of choice for self-care products Venture Life Group plc Interim results presentation September 2018
Slide 2: Disclaimer
This document (the "Presentation") is being provided to a limited number of parties who have previously expressed an interest in acquiring an interest (the "Investor Interest") in Venture Life Group plc (the "Company"). If you are in any doubt about the investment to which the Presentation relates,
Slide 3: Our Strategy
Our Strategy Ambition: To become a leading global self-care products business with our own expertise in development, manufacturing and international distribution. Our Brands Our Distribution Network Our Manufacturing Opportunity Capability We aim to acquire and • 53% Utilised in 2017* develop unlove
Slide 4: Six months ended 30th June 2018 financial highlights
Six months ended 30th June 2018 financial highlights • Revenues up 6% to £8.3 million (2017: £7.8m) • EBITDA increased 40% to £0.7 million (2017: £0.5m) • Profit before tax* increased to £0.1 million (H1 2017: loss of £0.1m) Head Office and Commercial • Cash at period end of £1.5 million (December 2
Slide 5: Significant growth potential in self-care market
Significant growth potential in self-care market • International consumer self-care group Head Office and Commercial (London) • Portfolio of marketed products, growing partner base, product pipeline • Products sold in 40+ countries R&D and Manufacturing Facility (Milan) Venture Life Group plc 5
Slide 6: Our market opportunity
Our market opportunity The ageing population is growing rapidly¹ Self-medication market annual change 2014-15³ 3.2 3 2 2.1 Billion 1 0.9 0.5 0 1990 2015 2050 2100 Population aged 60+ Healthcare budgets are under increasing pressure² £4.3bn 66% £14.9bn Sources: 1. United Nations (2017). World Populat
Slide 7: Our fully integrated model
Our fully integrated model Research & Manufacturing Distribution Development • Innovation • Quality • Commercial control expertise Consumer • Agility Consumer • Excellent • Capital light demand • Technical customer distribution supply expertise service model • Global • Partners fund accreditation ma
Slide 8: Our Manufacturing KPIs
Our Manufacturing KPIs 80 Capacity 70 2017 Group revenue £16m Units per year (million) 60 Utilisation (as % of 40m units per year 53% capacity) 50 No. of products produced in 2017 21m 40 70 Anticipated capacity with £1m additional 40m 30 annual capex (i.e. 2% of manufacturing revenue per year for ne
Slide 9: Global distribution network
Global distribution network 40+ countries 100+ marketing partners Countries where products sold or partnered Countries where key deals signed/products launched in 2017 Countries where no products sold or partnered Venture Life Group plc 9
Slide 10: Self care product portfolio
Self care product portfolio Key self-care brands Fungal Nail Brain Function Oral Health Haemorrhoids Cholesterol Infections & Memory Venture Life Group plc 10
Slide 11: Expertise by therapeutic area
Expertise by therapeutic area 2017 % Group revenues by main therapeutic areas • Long standing Group expertise in oral care 21% * Oral care • Wide therapeutic coverage * 35% UltraDEX Skin care 4% Nail fungus • Establishing our own bands in * 5% Hair Care key areas 5% * Womens health Other 10% • Utili
Slide 12: Financial Highlights
Financial Highlights
Slide 13: H1 2018 profit and loss account
H1 2018 profit and loss account £ million H1 2018 H1 2017 % change Revenue 8.3 7.8 6% Gross Profit 3.0 3.0 - Gross Margin 36% 39% Total admin expenses (exc. D, A & 2.3 2.5 -8% SBP) EBITDA 0.7 0.5 40% Operating Profit/(Loss) (0.05) (0.12) Profit/(Loss) before Tax (0.3) (0.4) + Loss after Tax (0.5) (0
Slide 14: Revenues H1 2018
Revenues H1 2018 • Revenues increased 6% to £8.3 million (H1 2017: £7.8 million) £m £8.4 £8.3 £8.2 +6% £8.1 £8.0 £7.9 £7.8 £7.7 £7.6 £7.5 H1 2017 Revenue H1 2018 Revenue 14 Venture Life Group plc
Slide 15: EBITDA and profit
EBITDA and profit • EBITDA increased to £0.7 million (H1 2017: £0.5 million) • Gross profit of £3.0million, representing a gross margin of 36% EBITDA for H1 2017 and H1 2018 £m 0.1m 0.7m 0.1m 0.5m H1 2017 EBITDA VLG Brands Customer own Brands H1 2018 EBITDA Venture Life Group plc 15
Slide 16: Revenues H1 2018
Revenues H1 2018 • Revenues increased 6% to £8.3 million (H1 2017: £7.8 million) £m £8.4 £8.3 +6% £8.2 £8.1 £8.0 £7.9 £7.8 £7.7 £7.6 £7.5 H1 2017 Revenue H1 2018 Revenue 16 Venture Life Group plc
Slide 17: EBITDA and profit
EBITDA and profit • EBITDA increased to £0.7 million (H1 2017: £0.5 million) • Gross profit of £3.0million, representing a gross margin of 36% EBITDA for H1 2017 and H1 2018 £m 0.1m 0.7m 0.1m 0.5m H1 2017 EBITDA VLG Brands Customer own Brands H1 2018 EBITDA Venture Life Group plc 17
Slide 18: Balance sheet
Balance sheet £ million December 2017 June 2018 Fixed assets 21.2 20.9 - Cash 1.4 1.5 Current assets 10.0 11.0 Total assets 31.3 31.9 - Total debt (excluding finance leases) 7.7 8.3 Total liabilities 17.1 18.2 Total equity and liabilities 31.3 31.9 Venture Life Group plc 18
Slide 19: Balance sheet – effect of fund raise
Balance sheet – effect of fund raise £ million June 2018 July 2018 Proforma fund raise Fixed assets 20.9 4.2 25.1 - Cash 1.5 9.2 10.7 Current assets 11.0 13.4 24.4 Total assets 31.9 13.4 45.3 - Total debt (excluding finance 8.3 (4.1) 4.2 leases) Total liabilities 18.2 (4.1) 14.1 Total equity and lia
Slide 20: Commercial Highlights
Commercial Highlights
Slide 21: Continued commercial progress
Continued commercial progress Venture Life Group Brands UK Market Post-period end H1 2018 International Markets Highlights § 6 long term distribution § Increased distribution – § Dentyl acquisition – deals completed new listings integration underway § 5 launches internationally § Innovation – One GO
Slide 22: UltraDEX Performance - UK
UltraDEX Performance - UK H1 performance • New partners – launched in Lloyds Pharmacy and Day Lewis Pharmacy • Existing partners – distribution gains on core range in Superdrug and Boots – +30% net gains • Innovation – One GO and Essentials Kit launch in Boots, Superdrug, Amazon, Ocado and Pharmacy
Slide 23: UltraDEX partnered in 15 markets
UltraDEX partnered in 15 markets • UltraDEX is now partnered in 15 territories • Presence in the EU – 4 key EU markets covered • France – strategic partner in EU for mass market (France, Spain, Portugal, Belgium) • Ambition – 30 markets by end 2020 Countries where Countries where UltraDEX signed/ Ul
Slide 24: Dentyl acquisition
Dentyl acquisition • Dentyl acquired 7th August 2018 - consideration £4.2m • 20+ years in UK market • 2017 = £2.9m (net sales) and £1.2m (operating profit) • 95% of business from UK • Current international markets – China, South Africa • Opportunity to improve revenues/profitability: • Expansion in
Slide 25: Other commercial H1 highlights
Other commercial H1 highlights • Reorganisation of production facility • Increased production capacity • Extended agreement with Alliance Pharma • Extended existing contract until 2025 • Added new product to manufacture – Atopiclair • Additional €1.6m of annual revenues, to begin late 2018/early 201
Slide 26: Outlook H2 2018
Outlook H2 2018 • Dentyl acquired August 2018, manage and integrate – China opportunity • UltraDEX promotions and new listing impacts • Order book end August +20% over same point in 2017 • Myco Clear and NeuroAge marketing studies nearing completion • Cash generative going forward • Significant cash
Slide 27: Buy and Build strategy
Buy and Build strategy • Self-care market growing, demographics favourable – EU market +£20bn* • Underlying organic growth from existing portfolio • VLG has built platform to maximise cash flow and earnings from unloved brands – operating leverage • Strategy to buy and build with additional brand as
Slide 28: Appendices
Appendices
Slide 29: An experienced management team
An experienced management team Jerry Randall Sharon Collins Gianluca Braguti Adrian Crockett Chief Executive Officer Commercial Director Manufacturing Director Chief Financial Officer • Experienced executive • Almost 20 years experience • Pharmacist graduate • Over 15 years finance director in inter
Slide 30: Net Debt/(Net Cash) position
Net Debt/(Net Cash) position £’M June 2018 July 2018 Proforma Comments fund raise Convertible Bond 1.9 (1.9) - £1.9m convertible bond (9%) – repaid September 18 Vendor Loan notes 1.8 (1.8) - €2m Euro loan note (4%) – repaid September 18 Italian term loans 2.6 - 2.6 €3.1m initial principal Deferred c
Slide 31: Italian loan position December 2017
Italian loan position 31 December 2017 €’000 Planned Full Interest rate Repayment BNL SPA 300 30/09/20 1% +3m Euribor Intesa SPA 2,000 30/11/24 0.90% +6m Euribor Unicredit SPA 800 31/05/23 1.05% + 6m Euribor RIBA 770 On demand £<1% + Venture Life Group plc 31
Slide 32: Shareholder register
Shareholder register J O Hambro 10.9% Business Growth Fund 9.4% Mr Gianluca Braguti (Director) and associated holdings 8.5% Livingbridge 7.8% Ennismore Fund Management 7.5% Otus Capital Management 6.6% Mr Jerry Randall (Director) and associated holdings 4.7% Quilter Cheviot Limited 4.6% Dr Michael F