25 slides from Arcticzymes Technologies Asa's earnings presentation, Apr 26, 2018
Slide 1: Q1 2018 Presentation
Q1 2018 Presentation 26.04.2018, Oslo
Slide 2: Agenda
Agenda • Highlights • Beta-glucans • Animal- and Consumer health • Cancer • Advanced wound care • Enzymes • Molecular and new markets • Q1 Financials • Outlook for 2018 2
Slide 3: Biotec in brief
Biotec in brief A corporation with two independent versatile technology platforms who both benefit from underlying market growth Beta-glucans Enzymes • A common unique technology platform with • Fast growing business that is developing and immune modulating products for improved selling unique enzym
Slide 4: Highlights Q1 2018
Highlights Q1 2018 Sales & Gross contribution 20 000 Sales • Q1 sales of MNOK 14.2 (18.2) 18 000 Gross contribution • EBITDA of MNOK -5.9 (-4.1) 16 000 14 000 • 300-patient study in UK confirmed 12 000 Woulgan’s resilient effectiveness 10 000 • ArcticZymes doubled SAN customers 8 000 to more than 90
Slide 5: Beta-glucans
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Slide 6: Activities for M-Glucan® and M-Gard®
Activities for M-Glucan® and M-Gard® Over 20 years experience with immune modulating beta-glucans Animal health • Sales experiences annual and seasonal fluctuations driven by demand for health feed within the aquaculture sector • Managed to prolong contract with largest customer, but also lost a les
Slide 7: SBG® in current neuroblastoma vaccine trial
SBG® in current neuroblastoma vaccine trial SBG® and Neuroblastoma • High impact indication in children with a large unmet medical need (<50% survival in high- risk patients) • Proof of concept study for use of SBG® as adjuvant in immunotherapy of cancer • Data from trial to be presented at Advances
Slide 8: SBG® in immunotherapy of neuroblastoma
SBG® in immunotherapy of neuroblastoma Clinical trial program of the bivalent ganglioside vaccine in combination with SBG® for high-risk neuroblastoma 2009 – 2013 2013 – 2016 2016 – 2019 2019 – 2021 Phase I Safety Phase I/ II Efficacy Phase II Efficacy Phase II/III Efficacy ≥2nd remission patients R
Slide 9: Status Woulgan®
Status Woulgan® • Large-scale UK study shows unique positioning for Woulgan • strong healing benefits • user-friendly format • Woulgan is mostly used in out-patient settings – salesforce coverage is key: • Large number of call-points for salesforce. • Lack of scale for a “one-product” company. • Ide
Slide 10: Activities in all markets
Activities in all markets UK Nordics Germany Clinical Strong results from 300 patient study Patients with ulcer-type wounds treated Completed 2 manuscripts from Nordic case series with Woulgan show 62% healing rates versus Submitted for publication in Q2 2018 30% for standard care at 12 weeks Manusc
Slide 11: Research and Development: Woulgan Dry Layer
Research and Development: Woulgan Dry Layer • Pilot plant established for testing different formulations for the manufacture of Woulgan® dry layer • The gel-forming dry layer is aimed used on exuding and large wounds like venous leg ulcers and donor sites • Priority to develop proprietary production
Slide 12: ArcticZymes: Molecular and new markets
ArcticZymes Molecular and new markets
Slide 13: Commercial Updates
Commercial Updates • Fluctuation of quarterly sales with largest customer will be different than previously following establishment of centralised facility. Anticipate normal level of sales in 2018 • New supply agreement with a UK molecular kit and diagnostic company who have integrated Cod UNG into
Slide 14: Biomanufacturing: Gene Therapy Business
Biomanufacturing: Gene Therapy Business Busy quarter for SAN related customer activities: • Doubled customer base with respect to gene therapy opportunities (90+ customers today) AZ’s SAN • Majority of customers in early phase, purchasing small qualities on a frequent basis • Several customers who w
Slide 15: Innovation Update: ArcticZymes Proteinase
Innovation Update: ArcticZymes Proteinase Innovation Status Commercially Attractive • Developing a new proteinase enzyme which represents a • Vast array of customers interested in AZ’s proteinase new class of enzyme - Including key accounts • Likely launch the enzyme in Q2 subject to finalising the
Slide 16: Strengthening Sales Team
Strengthening Sales Team ArcticZymes is preparing to manage growth in its commercial team: • Strengthen its business development team by hiring experienced sales professionals • Currently hiring 1 USA and 2 EMEA based business developers • Instrumental in boosting sales capabilities beyond today’s l
Slide 17: Q1 Financials
Q1 Financials vitae. BIOTEC ret” PHARMACON
Slide 18: Speed of cash outflow as expected
Speed of cash outflow as expected Net cash position First quarter changes in cash of -10.6 MNOK Amounts in NOK 1.000' 50 000 45 000 • Investment in raw material inventory for 40 000 consumer health products 35 000 • 13.2 (14.4) MNOK in short-term 30 000 receivables 46 489 25 000 • 12.5 (16.9) MNOK i
Slide 19: Q1 2018 Cash flow detailed
Q1 2018 Cash flow detailed Q1 2018 Cash flow • Q1 2018 Cash flow from operations -10.5 MNOK 35 000 Amounts in NOK 1.000' • Explained by change in working capital of 30 000 • Receivables 1.2 MNOK • Payables -4.5 MNOK 25 000 • Inventory -1.7 MNOK 20 000 15 000 • Q1 2018 Cash flow from investments -0.1
Slide 20: A “soft” start for 2018
A “soft” start for 2018 Biotec revenues per segment Animal & Consumer Health 10 000 Amounts in NOK 1.000' ArcticZymes Woulgan Segment Q1 Sales 8 000 ArcticZymes MNOK 6.3 6 000 Animal & Consumer Health MNOK 7.4 Woulgan MNOK 0.5 4 000 Group MNOK 14.2 2 000 0 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 20
Slide 21: Loss in Q1 characterised by soft sales
Loss in Q1 characterised by soft sales EBITDA Operating Expenses Amounts in NOK 1.000' Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 0 Personell expenses -1 000 Property, plant and equipment -2 000 IT -3 000 External services Marketing and sales -4 000 License, patent and -5 000 trademark Other operating
Slide 22: Beta-Glucan performance
Beta-Glucan performance Beta-Glucans Q1 YTD (Amounts in NOK 1.000) 2018 2017 2018 2017 • Sales driven primarily by Animal Health Sales revenues 7 905 9 348 7 905 9 348 but Consumer Health is becoming more Gross profit 3 633 3 465 3 633 3 465 Operating expenses -8 294 -8 755 -8 294 -8 755 important E
Slide 23: ArcticZymes performance
ArcticZymes performance Enzymes Q1 YTD (Amounts in NOK 1.000) 2018 2017 2018 2017 • Q1 2018 sales reduced by MNOK 2.5. This Sales revenues 6 337 8 850 6 337 8 850 was as expected Operating expenses -7 915 -7 470 -7 915 -7 470 EBITDA -667 2 595 -667 2 595 • Operating expenses increased compared Sales
Slide 24: Outlook 2018
Outlook 2018 cay. ¢ o@ete. BIOTEC ret” PHARMACON
Slide 25: Outlook 2018
Outlook 2018 • Overall sales growth versus 2017 • Significant reduction in cash consumption • Review of Woulgan go-to-market model to ensure further growth • AZ expects to grow the business organically while also looking for inorganic growth opportunities 25