Aap Implantate Ag · XETR:AAQ1
Aap Implantate — Investor Presentation (September 2021)
40 slides from Aap Implantate's investor presentation, Sep 28, 2021
Slide 1: aap Implantate AG Information Memorandum
aap Implantate AG Information Memorandum September 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement Our publication may include predictions, estimates or other information that might be considered forward-looking. While these forward-looking statements represent our current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual
Slide 3: Table of contents
Table of contents 1 Executive Summary 4 2 Trauma Business 14 3 Antibacterial Silver Coating Business 24 4 Resorbable Magnesium Implant Business 31 aap Implantate AG 3
Slide 4: Investment highlights
Executive Summary Investment highlights New management team that executed extensive restructuring over the last 24 1 months with a now profitable operating trauma business (EBITDA recurring) 2 Scale up company striving for accelerated and profitable growth with significantly improved bottom-line; do
Slide 5: aap at a glance
Executive Summary aap at a glance Organisation Technologies ➢ Globally operating medical device company based in Germany ➢ Founded in 1990 Antibacterial Resorbable ➢ 111 Employees (30/06/2021) Silver Coating Magnesium 3 innovative and IP- ➢ Distribution: Implants protected platform ➢ Germany: Direct
Slide 6: Innovative and game-changing product portfolio
Executive Summary Innovative and game-changing product portfolio Unmet need: Simplify Unmet need: Reduce surgical Unmet need: Avoidance of operation techniques site infections (SSI) second operation (explantation) Our answer: Comprehensive portfolio Our answer: Unique patented Silver Our answer: Uni
Slide 7: aap stock clearly undervalued in peer group comparison
Executive Summary aap stock clearly undervalued in peer group comparison Small & Mid Cap Peers FY/2021 (E) ➢ EV/Sales: 7.1 ➢ EV/EBITDA: 21.0 FY/2021 (E) ➢ EV/Sales: 6.6 ➢ EV/EBITDA: 38.3 FY/2021 (E) ➢ EV/Sales: 6.7 ➢ EV/EBITDA: 22.5 FY/2021 (E) ➢ EV/Sales: 1.1 ➢ EV/EBITDA: <0 → EV multiples indicate
Slide 8: New management team driving transformation
Executive Summary New management team driving transformation Rubino Di Girolamo Agnieszka Mierzejewska Marek Hahn CEO COO CFO CEO since 2019 COO since 2021 CFO since 2010 ➢ Since 2004 as investor and ➢ Since 2014 with aap ➢ Since 2007 with aap Board Member with aap ➢ Working in different ➢ Prior to
Slide 9: Visible restructuring successes in the last 24 Months
Executive Summary Visible restructuring successes in the last 24 Months *** kEUR Sales/ EBITDA recurring/Gross Margin kEUR Sales/ Sales per FTE (6 months) kEUR 8.000 90% 8.000 70 6.000 85% 60 6.000 50 4.000 80% 40 2.000 75% 4.000 30 0 70% 20 2.000 -2.000 65% 10 -4.000 60% 0 0 30.06.2019 30.06.2020 3
Slide 10: aap underwent extensive restructuring
Executive Summary aap underwent extensive restructuring Operational and sales issues before Efficient and poised for growth ➢ Lack of investments in product renewal ➢ Continuous improvement of portfolio and sales channel management ➢ Strong focus on developing and ➢ Incorrect assessment in regulator
Slide 11: Key strategic directions
Executive Summary Key strategic directions Corporate agenda ➢ Secure financing to continue investing in LOQTEQ® portfolio and Silver and bridge the gap until the company is generating cash ➢ Seek partnerships for further investing in silver R&D in adjacent (non-competitive) implant areas ➢ Expand ma
Slide 12: aap cash needs and your investment opportunity
Executive Summary aap cash needs and your investment opportunity Financing needs Your Chance LOQTEQ® ➢ LOQTEQ® set investments to grow • The Company is poised to sales in direct US business ➢ Portfolio expansion and product grow significantly in its core launches business ➢ Invest in efficiency meas
Slide 13: Table of contents
Table of contents 1 Executive Summary 4 2 Trauma Business 14 3 Antibacterial Silver Coating Business 24 4 Resorbable Magnesium Implant Business 31 aap Implantate AG 13
Slide 14: Global trauma fixation market with healthy growth >4% CAGR
Trauma Business Global trauma fixation market with healthy growth >4% CAGR Global Trauma Fixation Device Market: Revenue by Type bn USD, 2014-2020f aap Implantate CAGR 2019-2025: 4.34% product applications 10.0 9.75 9.36 8.99 9.0 8.59 8.20 8.0 7.88 7.56 7.21 6.92 Internal Fixation 7.0 6.62 5.65 6.38
Slide 15: Revenue share growth 2018 – 2023 (E)
Trauma Business Revenue share growth 2018 – 2023 (E) Revenue Share Growth 2018-2023 (E) Million EUR 25.000 CAGR +18% 20.000 15.000 10.000 5.000 - 2018 2019 2020 2021 (E) 2022 (E) 2023 (E) Direct Markets (HQ / subsidiary) Distribution partners Germany USA direct USA BD EMEA LATAM APAC ✓ Growth overal
Slide 16: aap has a strong customer retention
Trauma Business aap has a strong customer retention Customer Retention as of 30.06.2021 Observations 75% of customers stay with aap Direct sales to clinics via large > 5 years purchasing organizations 43% of customers stay with aap Sales to distributors – recent > 2 years pruning of portfolio leadin
Slide 17: International and national registrations
Trauma Business International and national registrations CE (Europe) International ✓ NMPA (China) ✓ ISO 13485:2016 valid until 02/2024 ➢ 8 certificates in China MDD incl. product cert. valid until 05/2024 ✓ ANVISA (Brazil) ➢ Registration valid until 04/2025 resp. 01/2026 depending on product group ➢
Slide 18: Trends shaping the trauma market
Trauma Business Trends shaping the trauma market MDR regulation ➢ EU introduced new medical device regulation in May 2021. ➢ Besides changes in process and documentation (which lead to slightly higher costs), for implant products a clinical study needs to be performed prior to certification, which s
Slide 19: What clinics typically want when purchasing implants
Trauma Business What clinics typically want when purchasing implants Quality and functionality ➢ Quality has different dimension (e.g. strength, surface structure, bio-compatibility, no cold welding when tightening screws etc.) but while it is still an absolute must, it’s fair to say that many suppl
Slide 20: Differentiated and broad aap LOQTEQ trauma portfolio
Trauma Business Differentiated and broad aap LOQTEQ® trauma portfolio Hand portfolio Pelvis Surgical intervention areas Plating System not fully covered today but foreseen in current portfolio roadmap Surgical intervention areas recently addressed (already FDA approved) Cannulated Screws Prox. Femur
Slide 21: LOQTEQ technology has tangible benefits for surgeons…
Trauma Business LOQTEQ® technology has tangible benefits for surgeons… Technology Key Achievements ✓ Unique technology with comprehensive patent protection ✓ 4 superior patent families that place strong demands on the design and fixation technology of the LOQTEQ® system ✓ Locking & Compression in ON
Slide 22: Road to success in trauma business
Trauma Business Road to success in trauma business Key Drivers: Goals: ✓ Continuous improvement of gross margin through Operational leverage operational efficiency programs and economies of scale ✓ Sustainable and profitable EBITDA growth in trauma ✓ Accelerating top-line growth with LOQTEQ® > 20Mio
Slide 23: Table of contents
Table of contents 1 Executive Summary 4 2 Trauma Business 14 3 Antibacterial Silver Coating Business 24 4 Resorbable Magnesium Implant Business 31 aap Implantate AG 23
Slide 24: “Game-Changer” for medical device industry
Antibacterial Silver Coating Business “Game-Changer” for medical device industry Unmet Need Our Response Antibacterial Silver Coating by aap Biofilm formed on an TiAl6V4 implant surface • Healthcare-associated infections (HAI) ✓ Pioneer in the development of an are one of the major challenges in ant
Slide 25: Application potential
Antibacterial Silver Coating Business Application potential Silver Coating T e c h n o l o gy P l a t f o r m Recon Other Trauma Hip prosthesis Cardiovascular Plates / External fixation Knee prosthesis Plates/screws Cannulated screws Nails Extremities Spine Dental Distal Medial Tibia Application Sur
Slide 26: Value creation path
Antibacterial Silver Coating Business Value creation path Silver coated plates and screws Clinical investigation of silver-coated plates and screws for traumatological treatment. Silver coated nails Feasibility study for silver coated plates and nails of a world leading medical device company. Silve
Slide 27: Investigator initiated trial (IIT)/ compassionate use
Antibacterial Silver Coating Business Investigator initiated trial (IIT)/ compassionate use Investigator Initiated Trial Compassionate Use Cases • Prof. Dr. Dr. Volker Alt (Chair and • Prof. Dr. Dr. Volker Alt (Chair and director for trauma surgery, director for trauma surgery, University University
Slide 28: Market study – Human Clinical Trial
Antibacterial Silver Coating Business Market study – Human Clinical Trial Clinical Need Study Objectives ➢ Surgical treatment of distal tibia ➢ To show the safety of the LOQTEQ® fractures is associated with antibacterial silver-coated system is high rate of post-operative non-inferior in comparison
Slide 29: Approval and market launch
Antibacterial Silver Coating Business Regulatory pathway – milestones* Human clinical study ➢ Prospective, controlled, blinded, multicenter study with ~230 patients in Germany and USA ➢ Patient recruitment ➢ Implantation and ➢ Data evaluation follow-up ➢ Submission of application 1 year 1 year 0,5 y
Slide 30: Table of contents
Table of contents 1 Executive Summary 4 2 Trauma Business 14 3 Antibacterial Silver Coating Business 24 4 Resorbable Magnesium Implant Business 31 aap Implantate AG 30
Slide 31: Resorbable magnesium screws with clear economic benefits
Resorbable Magnesium Implant Business Resorbable magnesium screws with clear economic benefits New Age: Resorbable Magnesium Implants by aap ✓ Innovative degradable product avoids a second surgery and results in a much shorter follow-up (control intervals for the healing process) due to its degradat
Slide 32: Pilot non-GLP animal study in the US indicates superiority of technology
Resorbable Magnesium Implant Business Pilot non-GLP animal study in the US indicates superiority of technology MicroCT Analysis after 6 weeks ✓ Good bone contact and no significant gas formation Coated Un-coated Titanium Pin Magnesium Pin Magnesium Pin MicroCT Analysis after 6, 12, 24 weeks ✓ After
Slide 33: Product launch for resorbable magnesium could happen in 2026
Resorbable Magnesium Implant Business Product launch for resorbable magnesium could happen in 2026 Clinical study pre- IDE clinical trial FDA submission submission Q2/2023 Q3/2025 Q2/2022 Q2/2022 Q2/2023 Q3/2025 a) 65-75 days FDA a) 30 days FDA a) 120 days FDA review review in Approval review b) FDA
Slide 34: Investment opportunity – your chance
Investment opportunity – your chance Participation in subscription right capital increase ✓ Enabling aap to build sustainable and profitable trauma business with > €20m sales and positive net cash-flow in 2023 ✓ Enabling aap to become European trauma player by expanding product portfolio and markets
Slide 35: Attachment (1/2) – Shareholder Structure
Attachment (1/2) – Shareholder Structure* 15.50% Ratio Capital Management B.V., Netherlands Noes Beheer B.V., Netherlands 12.94% Jürgen W. Krebs, Switzerland 53.09% Deepblue Holding AG, Switzerland Elocin B.V., Netherlands 9.45% Free Float** 4.64% 4.38% * Shareholdings in aap Implantate AG ≥ 3% as o
Slide 36: Attachment (2/2) – P&L H1/2021
Attachment (2/2) – P&L H1/2021 Profit & Loss Statement aap Group kEUR H1/2021 H1/2020 Diff Diff % Sales 5.970 4.353 1.617 37% Changes in inventories 158 -1.582 1.740 110% Other own work capitalized 72 36 36 101% Total revenues ex grants 6.200 2.807 3.392 121% Other operating income 861 468 393 84% C
Slide 37: Key abbreviations
Key abbreviations Abbreviation Description Abbreviation Description 3D three-dimensional HY Half-year aap aap implantate AG IP Intellectual Property Ag Argentum (silver) ISO International Standards Organization ANVISA Regulatory body for medical devices in Brazil k kilo (thousand) B2B Business to bu
Slide 38: Disclaimer
Disclaimer All information in this presentation is provided without guarantee for the correctness and completeness of the content. The presentation is provided for the recipient's internal use only. The content including texts, pictures and graphics are subject to copyright protection and other laws
Slide 39: …and continuing committed to innovation
aap: 30 years of… Great Service Highest Quality Excellent State of the Art Training Research & Development at the Berlin site Safe Products …and continuing committed to innovation aap Implantate AG 39
Slide 40: Contact
Rubino Di Girolamo Chairman of the Management Board / CEO Phone: +49 (0)30 75019 - 170 Mobile: +49 (0)1729756012 Email: r.digirolamo@aap.de Lorenzweg 5 12099 Berlin, Germany Phone: +49 30 75019 - 0 Agnieszka Mierzejewska Fax: +49 30 75019 - 111 info@aap.de Member of the Management Board/ COO Phone:
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