Slide 1: FY 2017 Earnings
FY 2017 Earnings February 22, 2018
Slide 2: Disclaimer
Disclaimer 1. This presentation may contain certain forward-looking statements, including assumptions, opinions and views of the Company or cited from third party sources. Various known and unknown risks, uncertainties and other factors could cause the actual results, financial position, development
Slide 3: Agenda
Agenda 1. FY 2017 Highlights 2. Financial Review & Outlook FY 2018 3. Strategic Direction 4. Appendix
Slide 4: A strong finish to 2017, with Q4 sales up by 4.7% reported and by 6.7% organically
A strong finish to 2017, with Q4 sales up by 4.7% reported and by 6.7% organically year-on-year FXN REVENUES IN Q4 17 VS Q4 16, IN EUR M GROUP +6.7% Plastics & Devices Primary Packaging Glass + 13.4% 359.1 383.2 -1.9% 200.3 227.2 159.0 156.1 2016 2017 2016 2017 2016 2017 TARGET OUTLINED IN Q3 2017:
Slide 5: Performance in line with latest guidance for FY 2017
Performance in line with latest guidance for FY 2017 GUIDANCE FY 2017 RISK SCENARIO FY 2017 AS COMMUNICATED IN ESTIMATED DELTA AS OF Final Result 2017 JULY 2017 OCTOBER 2017 Revenues ~ EUR 1.4bn (FXN)1 ~ EUR -30m (FXN)1 ~ EUR 1.362bn (FXN)1 Adj. EBITDA ~ EUR 320m (FXN)1 ~ EUR -10m (FXN)1 ~ EUR 314.3
Slide 6: Agenda: Financial Review & Outlook FY 2018
Agenda 1. FY 2017 Highlights 2. Financial Review & Outlook FY 2018 3. Strategic Direction 4. Appendix
Slide 7: Margins increase despite lower revenues
Margins increase despite lower revenues Revenues by division ORGANIC IN EUR M FY 2017 FY 2016 GROWTH IN % GROWTH1 IN % Total Group 1,348.3 1,375.5 -2.0% -1.8% - Of which P&D 757.2 765.4 -1.1% -1.4% - Of which PPG 592.0 610.6 -3.0% -2.2% Adjusted EBITDA by division FY 2017 FY 2016 EUR M MARGIN IN % E
Slide 8: Stable net income
Stable net income IN EUR M FY 2017 FY 2016 CHANGE Adjusted EBITDA 310.8 307.8 3.0 Depreciation -91.3 -86.9 -4.4 Adjusted EBITA 219.5 220.9 -1.4 Total one-off effects -5.2 -3.8 -1.4 - of which portfolio optimization -2.7 -3.5 0.8 - of which one-off incomes and expenses1 -2.2 -0.5 -1.7 Amortization of
Slide 9: Stable adjusted net income from continuing operations after non-controlling interests
Stable adjusted net income from continuing operations after non-controlling interests Reconciliation of net income from continuing operations to adjusted net income from continuing operations after non-controlling interests IN EUR M FY 2017 FY 2016 CHANGE Net income from continuing operations 103.1
Slide 10: Improved cash flow metrics
Improved cash flow metrics IN EUR M NOV 30, 2017 NOV 30, 2016 CHANGE IN % Total assets 2,444.1 2,374.3 2.9% Equity 789.5 763.3 3.4% Equity ratio 32.3% 32.1% 20bps Net working capital 185.7 200.3 -7.3% NWC in % of revenues 13.8% 14.6%1 -80bps Average NWC in % of FXN LTM revenues 16.5% 15.8%1 70bps FY
Slide 11: Net debt reduction; leverage below mid-term target
Net debt reduction; leverage below mid-term target NET DEBT AND FINANCIAL LEVERAGE NET DEBT SUMMARY Net debt IN EUR M FY 2017 FY 2016 1 Leverage (x) Drawn portion of RCF - 162.7 788.2 712.7 Promissory loan (2017) 250.0 - Promissory loan (2015) 425.0 425.0 2.6x Bond 300.0 300.0 2.3x Local borrowings
Slide 12: FY 2017 margins protected and balance sheet strengthened; proposal to increase dividend
FY 2017 margins protected and balance sheet strengthened Proposal to increase dividend by +4.8% Adj. EBITDA margin Operating Cash Flow margin Adj. EBITDA margin at 23.1% for FY 2017 Op. CF margin at 15.3% for FY 2017 Up 70bps versus FY16 of 22.4% Already above FY 2018 target of approx. 13% At 22.8%
Slide 13: Market context
Market context Strict monitoring of all business and macro drivers Market slowdown experienced Gerresheimer has continuously Some business uncertainties in 20171 reacted to volatile drivers alleviated, others to remain Close customer relationship allows to adapt offerings and capacities aligned with
Slide 14: 2018 Outlook
2018 Outlook 2018 GUIDANCE REPORTED FY 2017 EXPECTED FY 2018 RANGE Revenues EUR 1,348.3m EUR 1.348bn to approx. EUR 1.4bn (FXN1) Adj. EBITDA EUR 307.2m2 EUR 305m to EUR 315m (FXN1) Capex (% FXN sales) 8% ~8% (FXN1,3) WIDER FINANCIAL REPORTED FY 2017 POLICY FRAMEWORK Leverage 2.3x 2.5x Dividend payou
Slide 15: Agenda: Strategic Direction
Agenda 1.FY 2017 Highlights 2. Financial Review & Outlook FY 2018 3. Strategic Direction 4. Appendix
Slide 16: Social and macroeconomic trends supporting growth in the Healthcare Packaging Sector
Social and macroeconomic trends supporting growth in the Healthcare Packaging Sector Rise of chronic diseases Faster growth of Increasing access to healthcare & aging population generic drugs in Emerging Countries Increasing day to day medication Increasing addressable market More people with access
Slide 17: Gerresheimer is operating in large and attractive markets
Gerresheimer is operating in large and attractive markets Drug Cosmetics Pharma Pharma Syringes Delivery Glass Glass1 Plastic Devices Estimated Market Size 2017² ~ 1.8 ~ 2.2 ~ 5.8 ~ 0.9 ~ 4.0 (in € bn) Market CAGR '17-’22²) LOW SINGLE DIGIT MID SINGLE DIGIT (in %) The strategic relevant core market
Slide 18: Regional dynamics and packaging requirements set market trends
Regional dynamics and packaging requirements set market trends ESTIMATED IQVIA VOLUMES GLOBAL PHARMA MARKET TRENDS IMPACT CAGR ’17-‘221 (IN %) ON PACKAGING REQUIREMENTS Global Pharmerging 3.5% ROW 3.00% 3.10% 3.0% 2.70% 2.5% 2.00% 2.0% 1.70% 1.70% 1.5% End user Biocompatibility 1.0% safety 0.5% 0.0%
Slide 19: Resilience of business model underpinned by clear competitive advantages
Resilience of business model underpinned by clear competitive advantages Leading global player in Solid and balanced blue Experienced global Team Well invested global Healthcare & Cosmetics chip customer base with with various industry manufacturing footprint Packaging longterm relationships experie
Slide 20: Priority is on deploying growth levers, whilst continuing to drive quality improvement
Priority is on deploying growth levers, whilst continuing to drive quality improvement and adequate returns Expand into new markets Expand strategically to Regional Products & build new position and gain critical mass through Expansion Innovation products, customization and innovation Unlock new and
Slide 21: Expanding into new geographies
Expanding into new geographies Strong positions in Core markets, grow through: New customers New products MENA ASIA SOUTH AMERICA Core markets Established base in Pharmerging markets, grow through: Pharmerging markets Explore M&A Own investments Partnerships FY 2017 Earnings 21
Slide 22: Winning customers
Winning customers SERVING A WIDE CUSTOMER BASE ~ 5000 products for the Healthcare, Cosmetic and Food & Beverage industry: one of the broadest portfolio offerings Half of the revenues generated with the Top 20 customers in 2017 - well balanced portfolio Offering state-of-the-art solutions in the whol
Slide 23: Leading in Innovation
Leading in Innovation Gx Innosafe®, Gx RTF® Vials, Gx® Elite Glass and more innovations for our customers Set standards in our industry – together with strong partners Unique portfolio of syringes and high value primary packaging for biotech drugs Extend cosmetic packaging capabilities and technolog
Slide 24: Improving value proposition
Improving value proposition Leverage our very broad portfolio incl. high value plastics & glass technologies and offer packages and bundles Strengthen device contract manufacturing business Extend design, pharmaceutical assembly, services and technologies Show case own concepts, develop own device p
Slide 25: Prefillable Syringe Evolution: adapting to market trends and driving innovation
Adapting to market trends + Driving innovation + Enhancing value proposition: Example of Prefillable Syringe Evolution Clearject Plastic Prefillable Syringes – Glue residuals – Tungsten oxides Metal free cone bore forming Biocompatibility – Silicone oil particles Low tungsten using additional washin
Slide 26: Disciplined approach to capital allocation
Disciplined approach to capital allocation ORGANIC INVESTMENT M&A Capex spend at ~8% of sales for Stringent and selective approach to growth and maintenance projects acquisitions Controlled capacity extension Strategic fit, management profile and financial track record as key initial Clear payback c
Slide 27: Navigating short and long term challenges with a key priority: reigniting superior growth
Navigating short and long term challenges with a key priority: reigniting superior growth Regional Expansion Well positioned in large and attractive markets Market growth underpinned by Megatrends, Customers with different regional dynamics Strategic roadmap calibrated to ensure Product & Innovation
Slide 28: Agenda: Appendix
Agenda 1.FY 2017 Highlights 2. Financial Review & Outlook FY 2018 3. Strategic Direction 4. Appendix
Slide 29: Technical guidance: EPS
Technical guidance: EPS ESTIMATED IMPLICATIONS ON MODELLING TOPIC STATUS QUO + FOR FY 2018/19 US tax reform, the Tax Cuts and Jobs Expecting one-off positive effect for the 2018 Act passed on December 22, 2017 financial year of between USD 50m and USD Revaluation of Triggered a.o. immediate re-valua
Slide 30: P&D margins improved at a high level, PPG margins impacted by lower production output
P&D margins improved at a high level, PPG margins impacted by lower production output during the quarter Revenues by division Organic EUR M Q4 2017 Q4 2016 GROWTH IN % Growth in % Total Group 374.4 357.6 +4.7 +6.7 - Of which P&D 222.7 199.4 +11.7 +13.4 - Of which PPG 151.8 158.3 -4.1 -1.9 Adjusted E
Slide 31: Development of net working capital
Development of net working capital Nov 30, 2017 NOV 30, 2016 EUR M EUR M Inventories 148.4 155.4 thereof prepayments made 2.1 3.1 Trade receivables 242.7 232.1 Trade payables 176.3 157.0 Payments received on account 29.1 30.2 of orders Net working capital 185.7 200.3 Average NWC in % of LTM revenues
Slide 32: GXI Key Data
GXI Key Data in EUR per share 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Dividend 0.40 – 0.50 0.60 0.65 0.70 0.75 0.85 1.05 1.102 Dividend yield 1.5% – 1.8% 1.9% 1.7% 1.4% 1.7% 1.2% 1.5% 1.6% Payout ratio 22% – 26% 25% 25%1 23% 26% 25% 25% 27% Share price high 38.20 27.05 29.85 36.62 41.34 50
Slide 33: Overview of Abbreviations and Definitions
Overview of Abbreviations and Definitions Abbreviations and Definitions Adj. EBITDA Earnings before income taxes, net finance expense, amortization of fair value adjustments, depreciation and amortization, impairment losses, restructuring expenses and one-off income and expenses Adjusted EPS Adjuste
Slide 34: Financial calendar and contact details
Financial calendar and contact details FINANCIAL CALENDAR February 22, 2018 Annual Report Financial Year 2017 April 12, 2018 Interim Report 1st Quarter 2018 April 25, 2018 Annual General Meeting 2018 July 12, 2018 Interim Report 2nd Quarter 2018 October 11, 2018 Interim Report 3rd Quarter 2018 CONTA
Slide 35: Our Vision
Our Vision Gerresheimer will become the leading global partner for enabling solutions that improve health and well-being. Our success is driven by the passion of our people.