Hikma Pharmaceuticals Plc · LSE:HIK
Hikma Pharmaceuticals — FY2022 Earnings Presentation
31 slides from Hikma Pharmaceuticals's earnings presentation, 2023
Slide 1: 2022 Preliminary Results
Better health. Within reach. Every day. Hikma Pharmaceuticals PLC 2022 Preliminary Results
Slide 2: Disclaimer
Disclaimer Save to the extent required by law, neither Hikma Pharmaceuticals PLC nor any of its affiliates (Hikma), nor any other party, is under any duty to update or inform you of any changes to such information. In particular, it should be noted that the financial information relating to Hikma co
Slide 3: Resilient core performance driven by diversified business model
Resilient core performance driven by diversified business model $2,517m $596m $694m $530m 181.3¢ Core1 Core Core Operating Core basic earnings revenue operating profit EBITDA2 cash flow per share 1 Core results are presented to show the underlying performance of the Group, excluding exceptional item
Slide 4: Strong foundation and operational strength to support sustainable growth
Strong foundation and operational strength to support sustainable growth A well diversified, global Good strategic progress in Strong and sustainable generic pharmaceutical 2022 platform for future growth business • A solid platform for growth across • Successfully completed and • Strong market posi
Slide 5: Injectables
Injectables
Slide 6: Benefitting from broad portfolio and flexible manufacturing
Benefitting from broad portfolio and flexible manufacturing US Injectables revenue Revenue contribution from our by competition and revenue contribution1 expanding US portfolio Market leader for 40% of these products Products launched since 2016 contribute 33% of 2022 US Injectables 18% 1-2 competit
Slide 7: Strengthening foothold in Europe, leveraging our best-in-class manufacturing facilities
Strengthening foothold in Europe, leveraging our best-in-class manufacturing facilities EU generic injectable sales by supplier1 Belgium (in millions) Netherlands B. BRAUN UK Germany TEVA INTAS NOVARTIS VIATRIS SUN PHARMA Top 10 = AGUETTANT Canada France FRESENIUS PANPHARMA 51% of total $ AUROBINDO
Slide 8: Growing our market share in MENA and improving access to important medicines
Growing our market share in MENA and improving access to important medicines MENA Injectables total revenue ($m) Contribution from new launches Biosimilars Remaining portfolio +$87 (+96%) Products launched $180 $178 in 2H21 and 2022 $160 $146 contributed $91 $103 $120 15% of 2022 MENA Injectables re
Slide 9: Building our differentiated pipeline through internal R&D and partnerships
Building our differentiated pipeline through internal R&D and partnerships Injectables pipeline of 175 projects1 Adding complex products through partnerships Filed Top 20 business development products 89 products Specialty products 505(b)(2) Product by 6 3 type of 30 37 22 opportunity US MENA Europe
Slide 10: Branded
Branded
Slide 11: Delivering growth across our markets supported by our strong commercial capabilities and new launches
Delivering growth across our markets supported by our strong commercial capabilities and new launches 2022 key achievements across MENA markets Gaining market Benefiting from Differentiated portfolio share commercial strength driving growth Responsive organisation structure: High value medications i
Slide 12: Good strategic progress in our top markets
Good strategic progress in our top markets Algeria1 Saudi Arabia2 Egypt1 Total private market Total market size of Total private market size of $3.2 billion $10.6 billion size of $6 billion Hikma is the largest Hikma is 4th largest pharma company, with Hikma is 8th largest pharma company with pharma
Slide 13: A differentiated portfolio with pipeline focused on high value chronic medications
A differentiated portfolio with pipeline focused on high value chronic medications Anti-diabetics CNS Branded R&D strategy 12% 11% Anti-infectives Grow the potent product Cardiovascular 10% portfolio with high barrier 18% to entry products 119 GI 6% Introduce first to market Projects in Branded1 Der
Slide 14: Generics
Generics
Slide 15: Proactively managing through industry headwinds whilst ensuring business is on a stronger footing
Proactively managing through industry headwinds whilst ensuring business is on a stronger footing for the future 2022 performance Return to growth in 2023 and Industry headwinds improve resilience for the future • Industry-wide competitive pressures • Improve breadth of portfolio through new Revenue
Slide 16: Investing in a differentiated and speciality portfolio of higher barrier-to-entry products
Investing in a differentiated and speciality portfolio of higher barrier-to- entry products ER Oral Solid Liquid Generics strategy 14% 14% Focus on internal development Nasal of niche, complex, and 505b2 products 22 14% 80% of 2023+ submissions Projects in Generics1 Respiratory 9% are PIV, NDA, or C
Slide 17: Group
Group
Slide 18: Acting responsibly
Acting responsibly Empowering our people Protecting the environment Shaping an inclusive culture where Minimising our impact on the planet everyone can thrive • Reduction of greenhouse gas emissions (GHG) • Culture of progress and belonging • Values - innovative, caring and collaborative • Sustainab
Slide 19: Finance
Finance Khalid Nabilsi, Chief Financial Officer
Slide 20: Group financial highlights
Group financial highlights 2021 2022 % change Core revenue $2,553 million $2,517 million (1)% Core1 gross profit $1,301 million $1,265 million (3)% Core operating profit $632 million $596 million (6)% Core EBITDA2 $727 million $694 million (5)% Core profit attributable to shareholders $450 million $
Slide 21: Injectables
Injectables Revenue Core operating profit Revenue (million) (million) ● Constant currency ● Constant currency 10% growth in US, driven by good demand for our $1,400 $500 portfolio, recent launches and the contribution 8% from Custopharm $1,200 $1,141 $400 $428 10% 11% growth in Europe and ROW, refle
Slide 22: Branded
Branded Revenue Core operating profit Revenue (million) (million) ● Constant currency ● Constant currency Good growth across most markets, particularly in $800 $200 Algeria, Saudi Arabia and Iraq $180 $700 7% $160 38% Benefitting from our focus on chronic $691 $140 medications $669 3% $146 $600 $120
Slide 23: Generics
Generics Revenue Core operating profit Revenue (million) (million) Challenging competitive environment in the US $250 resulting in low double-digit price erosion and mid- $800 (18)% single digit volume erosion $820 $200 $700 $202 Slower than expected ramp of recent launches $672 $150 $600 (49)% $100
Slide 24: Expanding and enhancing our product pipeline
Expanding and enhancing our product pipeline Core R&D (million) $140 $143 $144 $120 $100 6% $80 $60 of Group core revenue invested in core R&D $40 Spend in line with strategy as we build a pipeline of $20 differentiated products. $0 2021 2022 Hikma Pharmaceuticals PLC 24
Slide 25: Continuing to invest in the maintenance, upgrade and expansion of our facilities across the Group
Continuing to invest in the maintenance, upgrade and expansion of our facilities across the Group Capex by region ($ million) $200 20% $180 $172m $160 $145m 15% $138m $140 $119m $120 $107m $107m US MENA $100 10% Europe $80 Capex/revenue (%) $60 5% $40 $20 $0 0% 2017 2018 2019 2020 2021 2022 Hikma Ph
Slide 26: Cash flow and balance sheet
Cash flow and balance sheet Debt and leverage (millions) 1283 Operating cash flow 932 Dec-21 Dec-22 777 846 1.2x 1.5x Operating cash flow 638 530 637 685 0.7x 0.9x 0.6x Operating cash flow/revenue 25% 21% 1013 0.4x 546 605 361 420 242 2017 2018 2019 2020 2021 2022 Net debt Total debt Hikma Pharmaceu
Slide 27: 2023 full year guidance
2023 full year guidance Injectables Branded Generics ● Revenue growth: ● Revenue growth: ● Revenue growth : 7% to 9% Mid to high single digits in low double digits ● Core operating margin: constant currency ● Core operating margin: 36% to 37% 16% to 18% Net finance Capital Tax expense expenditure Co
Slide 28: Slide 28
Slide 29: A strong investment case
A strong investment case Platform for future growth and a track record of success A solid platform Increasingly diverse Excellent financial A proven track record for growth across portfolio and discipline with a strong of delivering value for all three pipeline balance sheet and shareholders and bus
Slide 30: Appendix
Appendix
Slide 31: Group reported financial highlights
Group reported financial highlights 2021 2022 % change Revenue $2,553 million $2,517 million (1)% Gross profit $1,301 million $1,238 million (5)% Operating profit $582million $282million (52)% EBITDA1 $727 million $680 million (6)% Profit attributable to shareholders $421 million $188 million (55)%