Siemens Aktiengesellschaft · XETR:SIE
Siemens Aktiengesellschaft — Siemens — Investor Day (February 2008)
67 slides from Siemens Aktiengesellschaft's investor day presentation, Feb 28, 2008
Slide 1: Siemens Healthcare – Diagnostics Division
Siemens Healthcare – Diagnostics Division Jim Reid-Anderson, CEO Diagnostics Division Capital Market Day Siemens Healthcare Munich, February 28, 2008 For internal Copyright © Siemens use only / Copyright AG 2008. © Siemens All All AG 2007. rights reserved. rights reserved.
Slide 2: Safe Harbour Statement
Safe Harbour Statement This document contains forward-looking statements and information – that is, statements related to future, not past, events. These statements may be identified by words such as “expects,” “looks forward to,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,”
Slide 3: Our Customers' Decisions are both Product- and Solution-Oriented
Our Customers’ Decisions are both Product- and Solution-Oriented Workflow-oriented IT Diagnosis Prevention and Early Therapy Care Detection In Vitro In Vivo Diagnostics Diagnostics (IVD) (Imaging) Diagnostics Imaging & IT Workflow & Solutions Jim Reid-Anderson Bernd Montag Tom Miller Radiography/Ang
Slide 4: Diagnostics: In Vitro Diagnostics focus
Our Customers’ Decisions are both Product- and Solution-Oriented Workflow-oriented IT Diagnosis Prevention and Early Therapy Care Detection In Vitro In Vivo Diagnostics Diagnostics (IVD) (Imaging) Diagnostics Jim Reid-Anderson Immuno-assay Automation Chemistry Blood gas … Copyright © Siemens AG 2008
Slide 5: Siemens Healthcare Diagnostics
Siemens Healthcare Diagnostics €3.3bn in sales >14,000 employees We are the largest clinical diagnostics company Serving 30,000 customersin the countries in >110 world €300m R&D spend ~ 9% of sales 125,000 + instruments installed Copyright © Siemens AG 2008. All rights reserved. Page 5 February 28,
Slide 6: Global leader created through the acquisition of great companies
Global leader created through the acquisition of 3 great companies Customer service Innovation Comprehensive solutions Scale advantages Integrated chemistry Comprehensive lab portfolio Microbiology Point of care Coagulation Molecular diagnostics Dade Behring Immunoassay portfolio Bayer Diagnostic Pr
Slide 7: Global IVD industry – 2007: #1 position with increasing market share
Global IVD industry – 2007 #1 position with increasing market share IVD industry €20bn Roche 5-6% annual growth Siemens 17% 16% 11% Abbott 7 6% 37% Beckman Coulter All others 5% 4% J&J 4% Growth relative to market bioMerieux Becton Dickinson Source: IVD Market Model DX, 2007 Excludes glucose self-te
Slide 8: Leadership position in segments
Leadership position in 8 segments Microbiology Hematology Hemostasis Automation Chemistry Blood gas Urinalysis Molecular cytometry Infectious Immuno- disease ID/AST assay Flow Combined Siemens #1 #2 #2 #1 #2 #1 #2 #1 DPC / Bayer Dade Behring Market leader Significant participant Participant Copyrigh
Slide 9: What is In Vitro Diagnostics (IVD)?
What is In Vitro Diagnostics (IVD)? In Vitro Diagnostics “in glass” In vitro Analyze In vitro In vitro diagnostics is testing Bodily fluids: conducted in a test tube Whole blood Urine or instrument that analyzes Blood plasma Saliva blood and bodily fluids. Serum Copyright © Siemens AG 2008
Slide 10: What type of tests are performed?
What type of tests are performed? Examples of types of tests: Chemistry Immunoassay Hematology Hemostasis Microbiology Molecular Cholesterol Cardio- Cell Pre- & post- Bacteria HIV vascular counting operatives - Meningitis Glucose - Straphylo- Hepatitis Therapeutic Hormones Deep
Slide 11: IVD patient sample pathway
IVD patient sample pathway Diagnosis Centrifuge Instruments Lab Processing Analysis Blood Treatment drawn& LIS from monitoring patient Copyright © Siemens AG 2008. All rights reserved. Page 11 February 28, 2008 Capital Market Day Siemens Healthcare
Slide 12: IVD customers are diverse
IVD customers are diverse Physicians’ Hospital labs Reference labs Drug court labs offices Copyright © Siemens AG 2008. All rights reserved. Page 12 February 28, 2008 Capital Market Day Siemens Healthcare
Slide 13: Central lab testing is largest part of market
Global IVD industry – 2007 Central lab testing is largest part of market with growing molecular and point-of-care testing IVD industry €20bn Molecular +9% growth 5-6% annual growth 9% Point of Care (POC) +6% 14% Central lab +5% 77% Source: IVD Market Model DX, 2007 Copyright © Siemens AG 2008. All r
Slide 14: Labs want to improve their workflow
Labs want to improve their workflow ... Quality of healthcare Improving efficiency in healthcare Benefits Efficiency Better patient care a through innovation and process optimization Cost saving in healthcare Workflow-oriented IT Improve Healthcare Efficiency Prevention and Patient Care and Earl
Slide 15: ... and improve operational and financial outcomes
... and improve operational and financial outcomes 70% <2% Healthcare spent on IVD Clinical decision contribution Source: SG Cowen Copyright © Siemens AG 2008. All rights reserved. Page 15 February 28, 2008 Capital Market Day Siemens Healthcare
Slide 16: Industry trends
Industry trends Overall, industry trends are positive A challenging environment … … with positive trends Consolidation Aging population Manufacturers Emerging markets Customers Innovation in instruments Cost pressure and tests Labor shortages Copyright © Siemens AG 2008. All rights r
Slide 17: Creating shareholder value
Creating shareholder value Leveraging our business strategy Driving above-market revenue growth Leading the industry in innovation Creating highly satisfied customers Achieving our financial commitments Copyright © Siemens AG 2008. All rights reserved. Page 17 February 28, 2008 Capital Mar
Slide 18: IVD business model
IVD business model Reliable revenue stream of tests and service Gross Revenue profit ~5% Instruments ~15% Reagents ~95% Consumables ~85% Service Razor/razorblade business model Typically 5-year contracts 80% “closed” systems Copyright © Siemens AG 2008. All rights reserved. Page 18 February 28
Slide 19: A customer-focused business strategy
A customer-focused business strategy Current customers become highly satisfied; potential customers see clear advantages Shareholder value Customer excellence Customer Customer Operational Financial High- relations focused excellence excellence performance innovation culture Quality in everything we
Slide 20: Installed base of instruments
Installed base of instruments Installed base growth is key indicator of market share gains 140.000 6% CAGR 120.000 100.000 80.000 60.000 40.000 20.000 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2005 2006 2007 2008 Copyright © Siemens AG 2008. All rights reserved. Page 20 February 28, 2008 Capital Mark
Slide 21: Test, service, and lease revenue
Test, service, and lease revenue Stable recurring revenue stream 6% CAGR Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2005 2006 2007 2008 *Constant currency, using 2007 actual currency exchange rates Copyright © Siemens AG 2008. All rights reserved. Page 21 February 28, 2008 Capital Market Day Siemens Health
Slide 22: Test menu penetration
Test menu penetration Adding tests to our installed base of instruments increases revenue and profitability Adding newly launched tests Migrating tests from competitive instruments Revenue per instrument Growth in revenue and profits Benefits for customers: Fewer instruments to manage Economies
Slide 23: Creating shareholder value
Creating shareholder value Leveraging our business strategy Driving above-market revenue growth Leading the industry in innovation Creating highly satisfied customers Achieving our financial commitments Copyright © Siemens AG 2008. All rights reserved. Page 23 February 28, 2008 Capital Mar
Slide 24: Portfolio overview
Portfolio overview Covering all key testing segments Siemens Healthcare Diagnostics Central lab Molecular Point of care Chemistry Viral load Urinalysis Immunochemistry Genotyping Blood gas Automation Diabetes Hemostasis Cardiac Microbiology Hematology Copyright © Siemens AG 2
Slide 25: FY 2007 sales – A balanced product portfolio
Siemens Healthcare Diagnostics FY 2007 sales – €3.3bn A balanced product portfolio By product line By geographic region Microbiology Hemostasis POC Asia 4% 8% 12% Molecular Pacific Europe 4% 12% 40% Hematology 5% 67% 48% Chemistry/ Americas Immuno- chemistry/ Automation Central lab 84% Copyright © S
Slide 26: Chemistry/Immunochemistry – a tremendous growth opportunity
Chemistry/Immunochemistry – a tremendous growth opportunity Diagnosing and monitoring diseases: diabetes, renal, cardiovascular, anemia, fertility, drug monitoring Strategy All others Siemens Organic growth above market growth 23% 24% Execute best workflow continuum in the market Target high-m
Slide 27: The Dimension franchise – #1 brand in the central lab
The Dimension® franchise – #1 brand in the central lab Integrated systems – combining the capabilities of multiple instruments into one Chemistry Immunoassay Drug testing Dimension Vista® 3000T Plasma protein Intelligent lab system Improved workflow Reduced sample splits Capital/cost savings and
Slide 28: U.S. hospital laboratories using integrated systems
U.S. hospital laboratories using integrated systems 81% of the U.S. hospitals using an integrated system % of U.S. 100% use a Dimension® analyzer hospital laboratories using integrated systems 53% 46% 39% 35% 29% 24% 19% All other manufacturers Siemens 0% As of January: 2001 2002 2003 2004 2005 2006
Slide 29: Immunoassay systems
Immunoassay systems The gold standard in immunoassay testing ADVIA Centaur® XP IMMULITE® 2000 Immunoassay system Immunoassay system High throughput – 240 tests per hour Broadest allergy menu Comprehensive immunoassay test Routine and esoteric tests menu – over 65 assays Streamlined informa
Slide 30: Track-based workcell automation – #1 in the industry
Track-based workcell automation – #1 in the industry Sorts, stores, and transports patient samples, including decapping, resealing, and centrifugation ADVIA LabCell® StreamLAB® Workcell ® Low, medium, and high-volume throughput Hematology and hemostasis connectivity Open architecture/multiple
Slide 31: Most comprehensive chemistry/immunoassay portfolio
The most comprehensive chemistry/ immunoassay portfolio in the industry Stand-alone chemistry Stand-alone immunoassay Informatics Services Integrated systems Scaled automation Total lab automation Copyright © Siemens AG 2008. All rights reserved. Page 31 February 28, 2008 Capital Market Day Siemens
Slide 32: Hemostasis
Hemostasis Measures ability to form and dissolve blood clots, deep vein thrombosis, platelet function Strategy All others Organic growth above market growth 17% Siemens Strengthen quality, workflow, 31% and product portfolio Trinity Focus on emerging markets and 7% high-potential countries Bec
Slide 33: Microbiology ID/AST
Microbiology ID/AST Bacteria identification and antibiotic susceptibility testing (ID/AST) Strategy Secure leadership position in ID/AST Siemens Competitive advantage in panel 42% performance and time to market Strengthen informatics and automation positioning Target growth in emerging marke
Slide 34: Molecular
Molecular Detects or quantifies DNA and RNA for bacteria, infectious disease, oncology Strategy Secure strong #3 position in next 3 years All others Protect bDNA franchise 23% Roche Launch VERSANT™ kPCR and 37% TRUGENE OSx systems Expand test menu Siemens 7% Results VERSANT™ 440 FDA approv
Slide 35: Molecular solutions
Molecular solutions An attractive portfolio of molecular solutions VERSANT® 440 VERSANT® kPCR (in development) TMA TRUGENE LiPA Copyright © Siemens AG 2008. All rights reserved. Page 35 February 28, 2008 Capital Market Day Siemens Healthcare
Slide 36: Point-of-care testing leads to faster test results
Point-of-care testing leads to faster test results and better patient care + = Right information Right time Improved outcomes Copyright © Siemens AG 2008. All rights reserved. Page 36 February 28, 2008 Capital Market Day Siemens Healthcare
Slide 37: Strong leadership position in point of care
Strong leadership position Serving multiple point-of-care testing markets as the global #1 Hospitals Clinics/ Central lab Decentralized Physicians’ offices Urinalysis Global #1 CLINITEK® Multistix® 41% share Diabetes Global #1 DCA Vantage™ >70% share Blood gas RAPIDLab® Global #2 RAPIDPoint® 24% sha
Slide 38: Urinalysis
Urinalysis Urine strip testing in POC and central lab All others Strategy 10% Expand market leadership in central lab Sysmex through integrated urine chemistry/ 5% sedimentation system Arkray Siemens Accelerate innovation around urine strip 8% 41% Drive connectivity for all systems Geographi
Slide 39: Blood gas
Blood gas Delivering solutions from patient bedside to high throughput laboratories Strategy Promote central lab/POC-integrated Radiometer solution tied with connectivity 32% Accelerate growth in emerging markets Siemens Leverage industry’s broadest instrument 24% portfolio All others Levera
Slide 40: Broadest portfolio of instruments in the industry
In summary: broadest portfolio of instruments in the industry Chemistry/ Immunoassay Dimension Vista® 3000T ADVIA Centaur® XP IMMULITE® 2500 Intelligent lab system Immunoassay system Immunoassay system Specialty Hemostasis Microbiology ADVIA® 2120 Plus Hematology BCS® XP WalkAway®96 AutoSlide
Slide 41: Broadest test menu in the industry
Broadest test menu in the industry Providing comprehensive solutions for customers and high-margin revenue for shareholders Allergy By disease state: Immunosuppressive & Nervous therapeutic drug monitoring Anemia/iron metabolism Autoimmune/rheumatoid Muscular Infectious disease Bone metabolism Respi
Slide 42: The broadest array of solutions in the industry
The broadest array of solutions in the industry eBusiness Informatics Automation Consulting Scholarships Education Service and Support Copyright © Siemens AG 2008. All rights reserved. Page 42 February 28, 2008 Capital Market Day Siemens Healthcare
Slide 43: Healthcare consulting
Healthcare consulting Enhanced workflow reduces costs and improves patient outcomes Improvement Labor savings 40% (full-time equivalents) # of laboratories in network 40% # of instruments 28% Turnaround time to produce 60% Complejo Hospitalario Carlos Haya test results Málaga, Spain Siemens consulti
Slide 44: Creating shareholder value
Creating shareholder value Leveraging our business strategy Driving above-market revenue growth Leading the industry in innovation Creating highly satisfied customers Achieving our financial commitments Copyright © Siemens AG 2008. All rights reserved. Page 44 February 28, 2008 Capital Mar
Slide 45: Product development strategy
Product development strategy Customer-centered product development process Market Customer dynamics feedback Dimension Vista® 3000T Cardio- Intelligent lab system vascular ADVIA Centaur® XP Oncology Immunoassay system VERSANT® 440 Instrument Menu Integration Thyroid Molecular system & system develop
Slide 46: R&D spending
R&D spending Leading the industry at ~9% of revenue €m 350 Leverage industry-leading ~300 scale 300 250 Target investments based on market potential 200 Accelerate time to market 150 ~9% Eliminate duplication from 100 predecessor organizations 50 0 FY 2007 Copyright © Siemens AG 2008. All ri
Slide 47: Key development projects 2008
Key development projects 2008 A robust product pipeline with over 200 development programs running concurrently Informatics/ Platforms Assays Automation System software Dimension EXL Vista CEA/AFP LabCell decapper Centaur 4.0 Vista 500 Vista CSA Vista connectivity to LabCell Rapid Co
Slide 48: Creating shareholder value
Creating shareholder value Leveraging our business strategy Driving above-market revenue growth Leading the industry in innovation Creating highly satisfied customers Achieving our financial commitments Copyright © Siemens AG 2008. All rights reserved. Page 48 February 28, 2008 Capital Mar
Slide 49: Advancing customer excellence
Creating and delivering superior value to customers Differentiated value propositions World-class One Advancing Sell value commercial of offering customer customer organization team excellence Broadest portfolio of best-in-class products & solutions Copyright © Siemens AG 2008. All rights reserved.
Slide 50: Evaluating customer touch points
Evaluating customer touch points – 2007 US key service measurements are industry-leading % Customers rating important/excellent/very good Hotline/product support Importance Field service engineers Rating Sales representatives Clinical application specialists Order entry Logistics and del
Slide 51: U.S. chemistry/immunochemistry – 2007
U.S. chemistry/immunochemistry – 2007 Winning the hearts and minds of customers Chemistry analyzers Immunoassay analyzers Industry average Industry average 5.13 4.99 Siemens 5.38 5.38 5.19 Siemens 5.19 Scale: #1 #1 1 = very poor 2 = poor 3 = fair 4 = good 5 = very good 6 = excellent Siemens Other ma
Slide 52: The future is integrated!
The future is integrated! Radiologist attendee: "I have learned more in the last two days than in the last five years about what is going on in pathology. Together we can more powerfully demonstrate our value to the delivery of healthcare." In Vivo In Vitro Inaugural Molecular Summit Landmark prog
Slide 53: Creating shareholder value
Creating shareholder value Leveraging our business strategy Driving above-market revenue growth Leading the industry in innovation Creating highly satisfied customers Achieving our financial commitments Copyright © Siemens AG 2008. All rights reserved. Page 53 February 28, 2008 Capital Mar
Slide 54: Strong revenue momentum ahead of market
Diagnostics – Strong revenue momentum ahead of market €bn Revenue development Key activities Above Leverage new high-volume market growth integrated system Grow installed base Pro forma 3.3 Penetrate test menu Implement strategic pricing initiative for value selling Reported 1.6 Expand tes
Slide 55: 2008 ongoing profit margin currently 14-15%
2008 “ongoing” profit margin currently 14-15% €m Profit margin FY 2007 175 270 68 PPA 202 PPA OTC 95 17.4% 13.0% 6.1% Operating Basis for As reported Profitability Target Margin Profit margin Q1 2008 86 153 38 PPA 115 PPA OTC 67 21.5% 16.2% 9.4% Operating Basis for As reported Profitability Target M
Slide 56: Integration Update
Integration Update Integration is proceeding well Operational achievements Strong base business Positive customer reaction Organization in place Positive employee morale Immediate cross-selling opportunities Copyright © Siemens AG 2008. All rights reserved. Page 56 February 28, 2008 Capita
Slide 57: Have identified 62% of 2010 synergy savings
Integration Update Have identified 62% of 2010 productivity / synergy savings 500 €m Top focus areas Product line rationalization 240 Procurement Manufacturing consolidation Sales office consolidation 62% Back office/shared service 260 efficiencies Cross-selling opportunities 2010 Actual
Slide 58: Integration savings – manufacturing consolidation
Integration savings – example Manufacturing consolidation already announced Wales, U.K. Similar manufacturing Los protocol Angeles Excess capacity in Wales €8-10m annual savings 2010 and beyond Copyright © Siemens AG 2008. All rights reserved. Page 58 February 28, 2008 Capital Market Day Sieme
Slide 59: Integration savings – streamline commercialization channel
Integration savings – example Ability to streamline commercialization channel Country Country “A” “A” –– current future structure* structure Earn distributor margin Former Former Former Siemens DPC Bayer Dade Behring Consolidate sales offices/support staff Leverage cross- Distributor Direct Di
Slide 60: Diagnostics – improving group profit margin
Diagnostics – improving group profit margin Strong momentum to further enhance margin Profit margin development* Key activities Revenue growth Specialty assay mix Target Deal profitability 16-19% margin Method penetration 13% Integration Productivity Synergy €500m 2010 Leverage infra
Slide 61: Taking diagnostics to the next level. Together.
We are: Taking diagnostics to the next level. Together. Attractive industry – strong fundamentals Executing Solid growth integration Quality in opportunities everything we do Highly Strong motivated business employees momentum Copyright © Siemens AG 2008. All rights reserved. Page 61 February 28, 20
Slide 62: Focus and deliver
Focus and deliver Driving profitable growth and cash returns Getting the most out of the integrated diagnostics company Achieving best-in-class cost position incl. SG&A reduction Innovating for fast growth and competitiveness + + + Drive organic growth above market growth Deliver target margin Conve
Slide 63: Siemens – Answers for life.
SIEMENS Answers for life.
Slide 64: Reconciliation and Definitions for Non-GAAP Measures (I)
Reconciliation and Definitions for Non-GAAP Measures (I) Group profit from Operations is reconciled to Income before income taxes of Operations under Reconciliation to financial statements on the table Segment Information. See our Financial Publications at our Investor Relations website under www.si
Slide 65: Reconciliation and Definitions for Non-GAAP Measures (II)
Reconciliation and Definitions for Non-GAAP Measures (II) Average calculation for CE*: Year-to-Date Q1 2 Point average: (CE ending Q4 Prior year + CE ending Q1) / 2 Q2 3 Point average: (CE ending Q4 Prior year + CE ending Q1 + CE ending Q2) / 3 Q3 4 Point average: (CE ending Q4 Prior year + CE endin
Slide 66: Reconciliation and Definitions for Non-GAAP Measures (III)
Reconciliation and Definitions for Non-GAAP Measures (III) Our capital structure target is based on an Adjusted industrial net debt divided by EBITDA (adjusted). For the calculation of Adjusted industrial net debt, we subtract from Net debt (defined as Long-term debt plus Short-term debt and current
Slide 67: Siemens Investor Relations Team
Siemens Investor Relations Team Michael Sen +49-89-636-33780 Florian Flossmann +49-89-636-34095 Sabine Groß +49-89-636-35755 Dr. Martin Meyer +49-89-636-33693 Christof Schwab +49-89-636-32677 Dr. Gerd Venzl +49-89-636-44144 Susanne Wölfinger +49-89-636-30639 Webpage: http://www.siemens.com/investorr