Virbac SA · EURONEXT:VIRP
Virbac SA — FY2020 Earnings Presentation
43 slides from Virbac SA's earnings presentation, Mar 18, 2021
Slide 1: 2020 results & perspectives
2020 results & perspectives March 18, 2021 Shaping the future of animal health
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements with respect to Virbac’s profitability and financial condition, business operations, projects and outlook. Although Virbac’s management believes that such forward-looking statements are based on reasonable assumptions, as made as of th
Slide 3: Agenda
AGENDA 2020 financial highlights Ability to execute and main 2020 achievements Company priorities & 2021 situation Virbac 2030 strategic plan Appendix : 2021 agenda 3
Slide 4: Financials – Summary (1/5)
FINANCIALS – SUMMARY (1/5) 2020 Strong organic growth of 5.7% @ constant rates • Overall, contributions at constant exchange rates are positive across the entire business, except for the United States, which fell slightly, excluding Sentinel, and the impact of the disruptions to dog and cat vaccines
Slide 5: Financials – Summary (2/5)
FINANCIALS – SUMMARY (2/5) 2020 5
Slide 6: Financials – Summary (3/5)
FINANCIALS – SUMMARY (3/5) 2020 • Net profit : 141.8 M€ (vs. 54.4 M€ in 2019) @ real rate impacted by: • + Operational performance & opex savings (one-off) due to Covid-19 situation • + Non-recurring items incl. ⁻ + Sales of Sentinel (net capital gain ~66.5 M€) ⁻ - Impairment on CaniLeish (-3.0 M€)
Slide 7: 2020 Financials – Summary (4/5)
2020 FINANCIALS – SUMMARY (4/5) 2020 Actuals aligned with last guidance Perspectives 2020 Actuals 2020 • Growth @constant rates 0% - 3% +3.2% √ • EBIT Adj.1 ratio to revenue@ constant rates ~14.0% 14.4 pts √ • Net Debt cash positive -63.4 M€ √ 1 Ebit Adj.: Current operating profit before depreciatio
Slide 8: Consolidated Sales (5/5)
CONSOLIDATED SALES (5/5) 2020 8
Slide 9: Sales evolution
ME€ 6.8% -14.3% 29.3 20.4 =f = ———— US excluding Sentinel 0.8% 0.7 y Excluding Sentinel 16 ME (1.8%) at actual rates 50.1 M€ (5.7%) at constant rates Including Sentinel -4.1 M€ (-0.4%%) at actual rates 30.4 ME (3.2%) at constant rates T T T T T A 2019 Europe ROW us Exchange rates A 2020
Slide 10: Sales growth by region
SALES GROWTH BY REGION 2020 At constant rates Europe North America 386.1 M€ Asia 121.4 M€ +5.9% 166.7 M€ -0.8% +7.1% Pacific 80.3 M€ +6.6% Africa/Middle Latin America East 148.6 M€ 31.2 M€ +7.1% +4.5% 10
Slide 11: Sales growth by segment - Companion animals
SALES GROWTH BY SEGMENT - COMPANION ANIMALS 2020 At constant rates M€ (+7.3 excluding Sentinel) 11
Slide 12: Sales growth by segment - Food producing animals
SALES GROWTH BY SEGMENT - FOOD PRODUCING ANIMALS 2020 At constant rates M€ Bovine, Swine & Poultry 12
Slide 13: Sales breakdown by region and business
SALES BREAKDOWN BY REGION AND BUSINESS 2020 29.7% (XX%) 9.6% (XX%) ( ) : 2019 * Australia. New Zealand. Japan. Korea 13
Slide 14: Sentinel divestment accounting impacts
SENTINEL DIVESTMENT ACCOUNTING IMPACTS 2020 • The net value of assets sold breaks down as follows (in € million): Goodwill - 169.6 Intangible assets - 109.9 Inventories - 7.6 Others - 6.6 - 293.7 • The sale amounts to €363 million (US $410 million) generating : ➢ A capital gain of around €70 million
Slide 15: Profit & loss statement at real rates
PROFIT & LOSS STATEMENT AT REAL RATES 2020 15
Slide 16: Breakdown of EBIT adjusted evolution
BREAKDOWN OF EBIT ADJUSTED1 EVOLUTION 2020 M€ ● +3.6m€ of vaccine related insurance ● -3.5m€ of 2019 base effect (pension fund reversal) -16m$ essentially linked to : ● -13m$ Sentinel divestment ● -6m$ linked to One-off3 US Contribution to EBIT Adjusted : ● From 30m$ in 2019 … ● … to 14m$ in 2020 2
Slide 17: Evolution of cash flow
EVOLUTION OF CASH FLOW 2020 M€ 17
Slide 18: Evolution of free cash-flow
EVOLUTION OF FREE CASH-FLOW 2020 M€ 2019.12 2020.12 18
Slide 19: Evolution of net debt
EVOLUTION OF NET DEBT 2020 M€ Closing net debt @ constant rate & scope 296.5 M€ (-71.9 M€ vs. 12/2019) 19
Slide 20: Balance sheet analysis
BALANCE SHEET ANALYSIS 2020 M€ 984.9 984.9 655.7 655.7 20
Slide 21: Balance sheet – financial ratios
BALANCE SHEET – FINANCIAL RATIOS 2020 2018.12 2019.12 2020.12 21
Slide 22: Shareholding as of December 31, 2020
SHAREHOLDING AS OF DECEMBER 31, 2020 Number of shares: 8 458 000 22
Slide 23: Agenda
AGENDA 2020 financial highlights Ability to execute and main 2020 achievements Company priorities & 2021 situation Virbac 2030 strategic plan Appendix : 2021 agenda 23
Slide 24: A great ability to execute over the last 3 years
A GREAT ABILITY TO EXECUTE OVER THE LAST 3 YEARS Over 3 years, focus on Financial performance Social performance Environmental performance Market shares gains (with organic HSE and GPTW (Great with the definition of true objectives at growth above market rate) and place to work) programs 5 years (on
Slide 25: A great ability to execute over the last 3 years
A GREAT ABILITY TO EXECUTE OVER THE LAST 3 YEARS Organic growth at +4.5%, Ebita +18.5% (+1.3 point), Organic growth at +6.6%, Ebita +37.8% (+3 points), Debt reduction of €48 million @ constant exchange rates. Debt reduction of €88 million @ constant exchange rates. Net profit €21 million vs. €1.8 mi
Slide 26: Main 2020 achievements (1/2)
MAIN 2020 ACHIEVEMENTS (1/2) Another strong annual performance Year main focus (5.7% at constant rates and scope and 3.2% at • Covid-19 management: priority given to the health and safety of people constant rates and real scope despite Sentinel • Business continuity: remote communication channels st
Slide 27: Main 2020 commercial achievements (2/2)
MAIN 2020 ACHIEVEMENTS (2/2) MAIN 2020 COMMERCIAL ACHIEVEMENTS (2/2) Geographies ➢ Top 5 growth countries @ constant rates: India, France, Brazil, Mexico & China ➢ 10 zones growing double-digit of which Benelux, Brazil, China, Poland, New Zealand, Colombia, Scandinavia, Thailand, Vietnam… Products r
Slide 28: Geographies: Focus USA
GEOGRAPHIES: FOCUS USA ➢ 2020 performance impacted by Covid-19: -0.8% @ constant rate excluding Sentinel (-14.3% @ constant rate and actual scope) : US $92.2 million in 2020 vs. US $92.9 million in 2019 excluding Sentinel ➢ Major dynamics within our U.S. portfolio ○ Strong Sentinel sales in S1 follo
Slide 29: Geographies: Focus China
GEOGRAPHIES: FOCUS CHINA ➢ China growth plans impacted by pandemic: ○ Petfood launch postponed (due to African Swine Fever & now Bird Flu) ○ Suprelorin launch impacted by Covid-19 > Relaunch in 2021 ○ Launch of Virbagest (Altrenogest) for Swine as planned ○ Other projects on target & progressing wel
Slide 30: Geographies: Focus Chili
GEOGRAPHIES: FOCUS CHILI ➢ 2020 performance strongly impacted by Covid-19: +0.3% at constant rates ▪ different product portfolio dynamic vs. 2019 (growth driven by aqua parasiticides and antibiotics) ▪ Less smolts in the water for 2021 production ➢ Continuous R&D investments to comply with new regul
Slide 31: Agenda
AGENDA 2020 financial highlights Ability to execute and main 2020 achievements Company priorities & 2021 update Virbac 2030 strategic plan Appendix : 2021 agenda 31
Slide 32: Choosing sustainability: sustainable & profitable growth
«CHOOSING SUSTAINABILITY»: SUSTAINABLE & PROFITABLE GROWTH Transition Run 2020-2022 2023-2025 Divestment of Sentinel (loss of ~ 55M$ and Focus on organic growth ~ 3 points of Ebita) & portfolio reallocation above market / Gaining MS% Adding on programmatic M&A activities Significant investments in m
Slide 33: Main 2021 priorities
MAIN 2021 PRIORITIES PEOPLE INVESTMENTS / SYSTEMS • New gouvernance • Manufacturing & Lab systems • Virbac 2030 “purpose” To have the (ERP, MES, LIMS,...) • ESG, HSE BEST & MOST • Key processes • GPTW (HR, Finance, Purchase) ENGAGED To • Participative management & new normal post-covid people of the
Slide 34: Update Covid-19: current situation March 2021
UPDATE COVID-19: CURRENT SITUATION MARCH 2021 ➢ AH market extremely resilient compared to other industries but there are still certain uncertainties related to the current health situation with resurgences of second/third waves of Covid-19 currently and in the coming months, which could lead to lock
Slide 35: Agenda
AGENDA 2020 financial highlights Ability to execute and main 2020 achievements Company priorities & 2021 update Virbac 2030 strategic plan Appendix : 2021 agenda 35
Slide 36: Strategy - Virbac 2030
STRATEGY - VIRBAC 2030 ➢ Build the purpose and the long term vision for Virbac as a unique & highly differentiated company in the animal health market in 2030 : highly relevant & profitable in a changing world (consolidation of the industry and the customers, digitalization, market access, home deli
Slide 37: Virbac strategic positioning – products portfolio
VIRBAC STRATEGIC POSITIONING – PRODUCTS PORTFOLIO
Slide 38: Estimated peak sales potential of main R&D projects
ESTIMATED PEAK SALES POTENTIAL OF MAIN R&D PROJECTS (March, 2021) Launch Companion Animals M€ Food Producing Animals M€ Year • Dermatology • Parasiticides • Parasiticides • Anti-infectives 2021 • Non pharma products 7 • Vaccine 22 • Vaccine • Vaccine • Parasiticides • Non pharma products 2022 • Spec
Slide 39: 2021 perspectives – summary
2021 PERSPECTIVES – SUMMARY 2021 Guidance Notes between 3% to 5% @ constant rates Negative exchange rate impact Total revenue (0% to 2% @ constant rates and actual expected at around 10 M€ scope) Ebit adjusted1 Between 10% to 12% @ constant rates No material exchange rate impact ratio to revenue exp
Slide 40: Agenda
AGENDA 2020 financial highlights Ability to execute and main 2020 achievements Company priorities & 2021 situation Virbac 2030 strategic plan Appendix : 2021 agenda 40
Slide 41: 2021 Agenda
2021 AGENDA April 15* Q1 sales June 21 Annual shareholders’ meeting July 20* Q2 - H1 sales September 15* Half-year financial results September 16 SFAF meeting - 1st half 2021 financial & strategic information October 18* Q3 sales January 19, 2022* Q4 - Full year sales * After market close 41
Slide 42: Shaping the future of animal health
Shaping the future of animal health 2
Slide 43: Shaping the future of animal health
Shaping the future of animal hea