Gerresheimer Ag · XETR:GXI
Gerresheimer — Investor Day (December 2022)
77 slides from Gerresheimer's investor day presentation, Dec 6, 2022
Slide 1: Generating Sustainable Value
Generating Sustainable Value Virtual Capital Markets Day 2022 Duesseldorf, December 6, 2022
Slide 2: Disclaimer
Disclaimer − 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: Delivering on the Transformation
Delivering on the Transformation Our strong foundation and focused growth strategy are generating sustainable value
Slide 4: Gerresheimer AG - Capital Markets Day 2022
4 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 5: formula G: the vehicle to generate sustainable, profitable growth
formula G… …the vehicle to generate sustainable, profitable growth Strategy 5 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 6: Transforming Gerresheimer into a growth company
Transforming Gerresheimer into a growth company as innovation leader, solution provider and system integrator. 2015 6 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 7: Ambitious Strategic Goals Across Five Key Areas
Ambitious Strategic Goals Across Five Key Areas Guided by our 2028 Vision To: Growth Company as Innovation Leader and System & Solution Provider From: Commodity Provider with fast follower approach 7 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 8: About Gerresheimer: Systems and Solutions Provider
About Gerresheimer: Systems and Solutions Provider We Bring the Drug to and Into the Patient Strong Global Presence Pharma & Biotech 36 plants in 16 countries and 81% Sales in 91 countries across 6 continents Strong Focus 12% Cosmetics Over 1,500 customers with relationships 7% across major Pharma,
Slide 9: A solid, healthy foundation
The success of an ambitious growth strategy requires... …a solid, healthy foundation 9 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 10: Strategy Based on a Solid Foundation for Growth
Strategy Based on a Solid Foundation for Growth Consistent and Continuous Focus on Improving Competitiveness and Resilience Innovative and broad Customer centricity – product portfolio cross-divisional addressing global innovation and sales megatrend in prosperous leveraging on markets synergies Ope
Slide 11: Strategy needs a solid foundation
Strategy needs a solid foundation... That means: Doing homework Strategy Solid Foundation 11 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 12: The World is Changing: Global Challenges
The World is Changing: Global Challenges "No Scarcity of Crises" 12 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 13: In the Middle of the Storm
In the Middle of the Storm Global Challenges Inflation Pandemic Geopolitical Increasing Energy Tensions Prices Supply Chain Scarcity: labor, Challenges transport, raw materials 13 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 14: Global challenges have to be managed
External Challenges In addition, global challenges have to be managed Strategy Solid Foundation 14 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 15: Share Price
At the moment, we are facing a number of challenges, which lead to a considerable ▪ Geopolitical developments, particularly regarding gas supply volatility in the ▪ Comparatively high energy intensity in parts of our business Share Price ▪ Comparatively high debt levels in an environment of rising i
Slide 16: Continue to push forward our growth strategy or freeze it?
Should we continue to push forward our growth strategy or freeze it? 16 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 17: Different Scenarios of a Potential Strategy Adaptation
Different Scenarios of a Potential Strategy Adaptation Reflection Process Freeze the Push forward with Growth Strategy? growth strategy ▪ Retrench to commodity Reach critical size: approach ▪ Revenues > 3 billion euros ▪ Shut down or divest individual ▪ Sustainable profitability business units > 23%
Slide 18: Our Conclusion
Our Conclusion Commitment to formula G strategy reaffirmed ▪ Strategy is valid and delivering in all key elements ▪ Mix shift towards High Value Solutions Consideration of market dynamics ▪ Geopolitical changes are closely monitored and analyzed ▪ We see: ▪ Short-term impact on base business, basica
Slide 19: A strong strategy for sustainable, profitable growth
A strong strategy for External Challenges sustainable, profitable growth. A strong foundation as the basis for the strategy. Both are necessary to master the external challenges... Strategy ...and still successfully implement the Solid Foundation transformation. 19 12/6/2022 Gerresheimer AG - Capita
Slide 20: formula G Progress of strategy implementation
formula G Progress of strategy implementation
Slide 21: Year 4 of formula G
Year 4 of formula G ...to double-digit profitable growth >10% Guidance raised: Organic growth from high-single digit... +7.6% +3.5% CAGR + 2% 2015 2019 2020 2021 2022 21 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 22: Changing World: Powerful Mega Trends
Changing World Positioned to Benefit From Growth Driven by Powerful Mega Trends Emerging Markets: Increasing importance of Vaccinations as growth Increasing health care biotech market access Increasing level of outsourcing of More self-medication and Cosmetic becomes PharmaCo’s non-core individual m
Slide 23: Clear and Strong Path to Sustainable Growth and Value Generation
Clear and Strong Path to Sustainable Growth and Value Generation Examples for the Implementation Progress Extension of Technology Network with Portal Instruments and Adamant Health ▪ SensAir: First own IP drug ▪ Partnership with Merck delivery device ▪ Strategic Partnerships for biologics with Zolln
Slide 24: Significantly Upgraded Customer Perception
Significantly Upgraded Customer Perception Transformation is Visible Highest Value Added Innovation & Scalability & One Stop Shop Quality Solutions & Customization Flexibility Standards Services We are perceived as a strategic partner and solution provider. 24 12/6/2022 Gerresheimer AG - Capital Mar
Slide 25: Involvement Across the Value Chain
Involvement Across the Value Chain Old Gerresheimer: Commodity Supplier Approach API Drug Drug Customer Invention Formulation Manufacturing Drug Development Fill & Marketing & Process Finish Sales Value Added Systems & Patient Adherence & Solutions Washing & Physician Sterilization Support Containme
Slide 26: Expand Integrated Solutions to Reach Deeper into the Value Chain
Expand Integrated Solutions to Reach Deeper into the Value Chain Building on our Long-term Expertise API Drug Drug Customer Invention Formulation Manufacturing Drug Development Fill & Marketing & Process Finish Sales Value Added Systems & Patient Adherence & Solutions Washing & Physician Sterilizati
Slide 27: Strategic Partner of Choice for Global Pharma and Biotech Solutions
Strategic Partner of Choice for Global Pharma and Biotech Solutions Continuous Expansion of High Value Solutions Allows for Mix Shift & Margin Expansion Bring the Drug to the Patient Bring the Drug into the Patient Digital Ecosystem Containment Drug Devices & Digital Therapy Solutions Delivery Syste
Slide 28: Increase Value Through High Value Solutions
Increase Value Through High Value Solutions Gerresheimer High Value Solutions in a Nutshell All Biologics High Value Vials (Valor, RTF, Elite) Advanced Technology RTF Syringes Pumps and other own IP Solutions __ New Glass/Plastic__ Selected Other__ Solution Products__ 28 12/6/2022 Gerresheimer AG -
Slide 29: Attractive Markets Served With a Unique Portfolio
Attractive Markets Served With a Unique Portfolio Investing Into the Right Areas: High Value Solutions, Biologics & Injectables BioPharma & Diagnostics Beauty & Cosmetics Biologics & Injectables Diversified Therapies in: End Markets1 Diagnostics Masstige Prestige Antibodies & Cell & Gene Vaccines an
Slide 30: Biologics as a Key Growth Driver for Injectables
Biologics as a Key Growth Driver for Injectables
Slide 31: Injectable Drugs: Growth Driver for Wide Areas of the Portfolio
Injectable Drugs: Growth Driver for Wide Areas of the Portfolio Biologics Volumes to Increase Significantly Biologics: ▪ The fastest growing sector of the pharmaceutical industry ▪ 7 of the 10 top-selling drugs in the world Stringent quality requirements for biologic injectables are driving sales th
Slide 32: Continuously Expanding our Biological Solutions Portfolio
Continuously Expanding our Biological Solutions Portfolio Gerresheimer Offers the Right Solutions for Containment, Delivery and Digital Treatment Support Syringes Medical Devices Vials and Cartridges Gx RTF® Contract EZ-fill smart™ ClearJect® Manufacturing (RTF-Vials/Cartridges) platform Gx high-end
Slide 33: Strong Growth Potential for Syringes
Strong Growth Potential for Syringes We are Expanding our Portfolio, Global Footprint and Capacity in Syringes Syringes Medical Devices Vials and Cartridges Gx RTF® Contract EZ-fill smart™ ClearJect® Manufacturing (RTF-Vials/Cartridges) platform Gx high-end Gx® Gx® Monolayer syringes Autoinjector CO
Slide 34: Innovative Solutions Enable Mix Shift Towards Higher Value Syringes
Innovative Solutions Enable Mix Shift Towards Higher Value Syringes and Drive Profitable Growth Address the High Value Solutions Market: Serve Key Customers With the Right Technical Solutions and Services Biologics Solutions for Gx InnoSafe® highly sensitive drugs Bypass Dual Chamber Silicone Free S
Slide 35: Double Capacity Triple Revenue
Footprint Optimization & Capacity Expansion Global Syringes Strategy: Technology and Cost Leadership Double Capacity Triple Revenue Buende, Germany Pfreimd, Germany Wackersdorf, Germany Querétaro, Mexico Skopje, North Macedonia Greenfield Expansion in North America Asia Expansion 35 12/6/2022 Gerres
Slide 36: Strong Growth Potential for Autoinjectors and Pens
Strong Growth Potential for Autoinjectors and Pens We are Significantly Expanding our Portfolio in Contract Manufacturing Syringes Medical Devices Vials and Cartridges Gx RTF® Contract EZ-fill smart™ ClearJect® Manufacturing (RTF-Vials/Cartridges) platform Gx high-end Gx® Gx® Monolayer syringes Auto
Slide 37: Contract Manufacturing in Attack Mode
Contract Manufacturing in Attack Mode Expanding Strong Market Positions Through Secured Contracts Unique Market Positions Strategic Position ▪ Mature, established markets for inhalers 2028: Pens and pens 2022 ~40% 35% ▪ Strong pipeline for subcutaneous biologic injectables (autoinjectors, pens & pum
Slide 38: Chronic Obesity: A $50 billion Market Potential
Innovating for a Better Life: Fighting Obesity GLP-1: We Bring the Drug to and Into the Patient Chronic Obesity: A $50 billion Market Potential Source: Morgan Stanley Research, July 14, 2022 38 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 39: The Next Blockbuster of the Pharmaceutical Industry: GLP-1
The Next Blockbuster of the Pharmaceutical Industry: GLP-1 Obesity as a Pre-Stage of Diabetes More than 650 million Obesity is associated with more than 200 possible people worldwide suffer from health complications: obesity. Strokes Heart attack Kidney diseases Global Trend: Chronic obesity is cons
Slide 40: Obesity Treatment Market: Global Sales Potential of USD ~50 billion
Obesity Treatment Market Disproportionate Growth Expected in the USA Global Sales Potential of USD ~50 billion 60 10% 9% 50 8% 7% 40 6% $bn 30 5% 4% 20 3% 2% 10 1% 0 0% 2024 2025 2026 2027 2028 2029 2030 US revenues Ex-US revenues High-efficacy patient share Source: Morgan Stanley Research estimates
Slide 41: Confirming our Leading Position in Both Syringes and CMO
Confirming our Leading Position in Both Syringes and CMO Large “Eagle“ Contracts: Pushed by Diabetes/GLP-1 and Obesity Business Significant large business Attractive risk/return opportunities lead to profile with limited expansion of global downside Risk footprint Confirming our leading position in
Slide 42: Execution on formula G
Execution on formula G Glass Innovation and Market Disruption Through High Value Solutions, Digitalization and Sustainability
Slide 43: Strong Growth Opportunities in our Tubular Glass Business
Strong Growth Opportunities in our Tubular Glass Business We are Expanding our Biologics Portfolio Syringes Medical Devices Vials and Cartridges Gx RTF® Contract EZ-fill smart™ ClearJect® Manufacturing (RTF-Vials/Cartridges) platform Gx high-end Gx® Gx® Monolayer syringes Autoinjector COP RTF Vials
Slide 44: Accelerating the Conversion From Bulk to RTF Vials
Accelerating the Conversion From Bulk to RTF Vials Best in Class Industry Standard Already Developed ™ Total cost of ownership Quality improvement advantage Risk of vial breakage within the Significant reduction in TCO process significantly reduced for filling companies Low particles Easy implementa
Slide 45: RTF Conversion in Syringes as Role Model
RTF Conversion in Syringes as Role Model Repeat the Success Story of RTF Syringes Development Syringe Market Implications on Vials Market Successful shift from bulk to RTF syringes: Establishing new industry standard 100 Today 95% of our syringes are RTF 90 allows for market shift: EZ-fill smart™ 80
Slide 46: Market Disruption Through EZ-fill smart Solutions
Market Disruption Through EZ-fill smart™ Solutions Global Vials Strategy Leading market position with more than 30% share of global vials market. Disproportionate growth potential in High Value Solutions through EZ-fill smart™ conversion. Total Vial Market Share RTF Vial Market CAGR ~14,5% ~1.200 $
Slide 47: Shift From Volume to Value
Shift From Volume to Value Tubular Glass Accelerating our Profitable Growth Switch from bulk to EZ-fill smart™ platform Disproportionate 10x increase in RTF vials and Profitable margins and sales cartridges capacity1 Growth expansion Significant growth potential identified – in Europe, US and Asia 1
Slide 48: Digitalization as a Key Growth Driver
Digitalization as a Key Growth Driver
Slide 49: Digitalization Offers Additional Customer Value and Earnings Potential
Digitalization Offers Additional Customer Value and Earnings Potential Improve Health Outcomes & Reduce Healthcare Costs Health Outcomes + Personalized Drug Dosing Healthcare Costs + Improve Patient – Doctor communication − Improve non-Adherence1 + Patient Monitoring at home (Cost savings of $30-50b
Slide 50: Unlocking the Value of Patient Data
Unlocking the Value of Patient Data Improve Health Outcomes & Reduce Healthcare Costs Platform 3rd stage: Emergency Prediction & long-term Prevention Data Analytics 2nd stage: Patient Monitoring mid-term Sensors Patient App 1st stage: Patient Adherence today & near future 50 12/6/2022 Gerresheimer A
Slide 51: Respimetrix – Valuable Data From Every Single Breath
Respimetrix – Valuable Data Doctor / Disease Manager From Every Single Breath COPD Market: ▪ 300m patients worldwide with an incidence growth rate of about 40% over the last decade ▪ Hospital care in the US accounts for $13bn of the overall COPD healthcare costs Value Add Through Digital Solution: ▪
Slide 52: Revolutionizing Parkinson's Treatment
Revolutionizing Parkinson’s Treatment In cooperation with Parkinson Market: ▪ >1.3m Parkinson’s patients in Germany and the US, of which 80% will benefit from Gx solution ▪ Costs up to $30,000 per patient per year in US Value Add Through Digital Solutions: ▪ Reduce length of hospital stay by up to 2
Slide 53: Digital Twin
Digital Twin Enabling Trustworthy Automated Execution of Business Transactions Our solution secures access and trustworthy exchange of data across participants of the pharma supply chain. Value Add Through Digital Solution: Faster processes. Lower costs. Better quality. ▪ Automation of all quality c
Slide 54: Digital Business Models
Digital Business Models Gx Closely Cooperates with Philips on Digital Business Models Go-to-Market Advantages & functions of the platform: Doctor Patient Pharma 2025 ▪ Provides all basic functions to bring Gx Disease Field products to market quickly and cost- Parkinson Respiratory Adherence Traceabi
Slide 55: Innovation, digitalization and sustainability open new opportunities
Innovation, digitalization and sustainability open new opportunities 55 12/6/2022 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 56: Our Sustainability Strategy Gives us Competitive Advantage
Our Sustainability Strategy Gives us Competitive Advantage – now and in Future GxPure GxCircular GxCare Base year 2019 1 CO2 Emissions 4 Recycling and Waste 7 Health and Safety Scope 1 and Scope 2 of industrial waste -80% by 2028 lost time accident -50% by 2030 0% by 2028 frequency rate emissions in
Slide 57: Continuously Executing our Sustainability Strategy
Continuously Executing our Sustainability Strategy Good Progress in Translating our Targets Through Clear Roadmap Into Measurable Impacts Ongoing energy crisis doesn‘t affect the implementation of our sustainability strategy Long-Term hedge offers competitive advantage Innovation in new technologies
Slide 58: Key Take-Aways
Key Take-Aways 1. Shift from volume to value: Disproportionate margins and sales expansion in tubular glass 2. Fostering new business opportunities through data-driven business models 3. Sticking to the goals of our sustainability strategy strengthens our market position for current and future chall
Slide 59: Protected Growth
Protected Growth Capturing profitable growth opportunities supported by targeted capital allocation management
Slide 60: Attractive Markets Served With a Unique Portfolio
Attractive Markets Served With a Unique Portfolio Investing Into the Right Niches: High Value Solutions, Biologics & Injectables BioPharma & Diagnostics Beauty & Cosmetics Biologics & Injectables Diversified Therapies in: End Markets1 Diagnostics Masstige Prestige Antibodies & Cell & Gene Vaccines a
Slide 61: Investments are Leveraging on Global Mega Trends
Investments are Leveraging on Global Mega Trends Catching the Wave and Investing Into the Right Niches Profitable Double-Digit Revenue Growth Through: High Value Capacity & Contract R&D Solutions Regional Manufacturing Investments Expansion 61 12/6/2022 Gerresheimer AG - Capital Markets Day 2022
Slide 62: Good Track Record Proves Success of Ongoing Investment Strategy
Good Track Record Proves Success of Ongoing Investment Strategy Delivering Returns on Investments Capex and EBITDA contribution (in €m) Capex/ EBITDA Capex1 (in m€) Sales Incremental EBITDA3 Payback-Period4 Payback-Period4 (in years) (in €m) (in %)2 (in years) ∞ ∑ 2015-17 = 342 9% Δ 2019-16 = -5 ∞ ∑
Slide 63: Generating Sustainable Value by Targeted Capital Allocation Management
Generating Sustainable Value by Targeted Capital Allocation Management Gx Value Creation Model Rigorous and holistic capital Investments into attractive growth markets allocation process: with a priority on margin strong High Value KPIs: IRR, payback period and NPV Solutions Continuous improvement o
Slide 64: Accelerating Investments Into Unique Business Opportunities
Accelerating Investments Into Unique Business Opportunities Gx Value Creation Model Base Capex Growth Capex Capex type as % of revenues Growth capex by segment Capacity Expansion Base: ~ 4% High Value + Growth: Solutions 8% growth capex to grow organically high single-digit Contract Manufacturing 64
Slide 65: Accelerating Investments Into Unique Business Opportunities
Accelerating Investments Into Unique Business Opportunities Gx Value Creation Model Base Capex Growth Capex Growth Accelerator Projects Capex type as % of revenues Growth capex by segment Capex: ~150m€ over the next two years Capacity Expansion Base: ~ 4% High Value + Growth: Solutions 8% growth cap
Slide 66: Additional Profitable Growth Through Growth Accelerator Projects
Additional Profitable Growth Through Growth Accelerator Projects Gx Value Creation Model: Capturing Unique Opportunities Growth Accelerator Projects New orders with a particular focus on Biological Solutions: ▪ Contracts related to biologics in both contract manufacturing as well as syringes ▪ Very
Slide 67: More Than 50% of Growth Investments Into High Value Solutions
More Than 50% of Growth Investments Into High Value Solutions Gx Value Creation Model: Successful Mix Shift to High Value Solutions 2023 – 2025 Growth Capex1 Capacity Expansion High Value Solutions ▪ Address high market demand for vials globally with a particular focus on the US ~25% ▪ Increase RTF
Slide 68: High Value Solutions as Key Driver for Margin Expansion
High Value Solutions as Key Driver for Margin Expansion… Value Creation Model: HVS >35% Revenue Share by 2027 HVS Sales Share1 >35% High Value Solutions - Features High underlying market Average Adj. EBITDA growth margin of >30% ~24% ~21% High Value Solutions – Growth Drivers Smart & RTU Biologics c
Slide 69: Further Margin Expansion Through Operational Excellence
…and Further Margin Expansion Through Operational Excellence Value Creation Model: Enhancing Productivity Measures to Increase Productivity ▪ Align standards & processes globally ▪ Continued Automation of production processes, e.g. packaging process or internal transportation ▪ Continuously improve
Slide 70: Growth Investments Drive Guidance Increase
Growth Investments Drive Guidance Increase Guidance for FY 2023 and Mid-Term Current Guidance1 New Guidance1 Adj. EBITDA Financial result guidance increased impacting Adj. EPS on the back of proven performance in FY23 track record and further Reflects current margin expansion interest rate environme
Slide 71: Full Funding for Investment Program on Attractive Terms
Full Funding for Investment Program on Attractive Terms Financing of Investment Program Secured Successful issuance of Target Leverage of 2.5 - 3.0x should new promissory loans be reached by end of 2024 ▪ Promissory loans of EUR 300m issued in Net debt/Adj. EBITDA November 2022 very well perceived b
Slide 72: In a Nutshell
In a Nutshell Delivering Growth and Sustainable Value Investment program Maximize Financial Position ▪ Favorable market dynamics Shareholder Value ▪ Solid balance sheet and supported by mega trends reliable business ▪ Strict investment criteria to ensure attractive returns performance facilitates ▪
Slide 73: Outlook and Guidance
Outlook and Guidance Virtual Capital Markets Day 2022
Slide 74: Generating Sustainable Value for our Stakeholders
Generating Sustainable Value for our Stakeholders Key Message: Transforming and Repositioning our Business Continuously Strength through Secured (re)financing executing our our solid foundation at attractive terms Strategy Innovation, Seizing unique digitalization and Strong value creation growth op
Slide 75: Outlook and Guidance
Outlook and Guidance Guidance for FY 2023 and Mid-Term Group level guidance (FXN, organic) focused on three key drivers of shareholder value Revenue Growth Adjusted EBITDA Adjusted EPS (in %) Low ≥ 10% ≥ 10% single-digit FY 2023 (EBITDA growth) growth Mid-term ≥ 10% 23-25% ≥ 10% (margin) 75 12/6/202
Slide 76: Q&A Session
Q&A Session Virtual Capital Markets Day 2022
Slide 77: Q&A Session
Q&A Session Virtual Capital Markets Day 2022