Slide 1: Earnings Conference Call
Earnings Conference Call Fiscal Q1 2023 February 14, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements Safe Harbor Statement Regarding Forward-Looking Statements This presentation contains express or implied "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements
Slide 3: Agenda and Presenters
Agenda and Presenters Dev Kurdikar Today’s topics: Chief Executive Officer embecta overview Strategic priorities Jake Elguicze Chief Financial Officer Enterprise highlights Revenue and earnings review Guidance Pravesh Khandelwal Vice President, Investor Relations Q&A 3
Slide 4: Mission and Vision
Mission To develop and provide solutions that make life better for people living with diabetes Advance every day together Vision A life unlimited by diabetes 4
Slide 5: Strategic Priorities for Fiscal Year 2023
Strategic Priorities for Fiscal Year 2023 Strengthen base business • Maintain core injection business revenue • Navigate through operating environment; manage costs Separate and stand-up • Continue to execute on ERP Implementation • Manage through the temporary suspension of manufacturing operations
Slide 6: Q1 Fiscal Year 2023 Enterprise Highlights
Q1 Fiscal Year 2023 Enterprise Highlights • Strong commercial performance in a challenging macro environment, including supply chain and inflationary pressures, geo-political concerns, as well as certain COVID-19 disruptions • Held over 50 scientific and educational events reaching over 2,000 Health
Slide 7: Q1 FY23 vs. Q1 FY22 Revenue
Q1 FY23 vs. Q1 FY22 Revenue Dollars in Millions Three Months Ended % Increase / Decrease As-Reported Foreign Currency Constant Currency December 31, 2022 December 31, 2021 Revenue Growth Impact Revenue Growth U.S. $149.3 $150.9 (1.1)% ꟷ (1.1)% International $126.4 $138.4 (8.7%) (11.3)% 2.6% Total $2
Slide 8: Q1 FY23 Financial Highlights
Q1 FY23 Financial Highlights Revenue Q1 FY23 revenue of $275.7 million, down (4.7%) on an as-reported basis; up 0.7% on a constant currency basis, as compared to the prior year period Gross Q1 FY23 GAAP gross profit and margin of $188.8 million and 68.5%, compared to $203.9 million and 70.5% in the
Slide 9: Fiscal Year 2023 Financial Guidance
Fiscal Year 2023 Financial Guidance Dollars in Millions, Current Previous (1) except per share and percentages Low High Low High Revenue $1,084 $1,107 $1,050 $1,073 As-Reported % (4.0%) (2.0%) (7.0%) (5.0%) Constant Currency % (1.5%) 0.5% (2.0%) 0.0% F/X % (2.5%) (5.0%) Contract Manufacturing $5 $10
Slide 10: Thank you
Thank you
Slide 11: Appendix
Appendix embecta’
Slide 12: Non-GAAP financial measures
Non-GAAP financial measures In evaluating our operating performance, we supplement the reporting of our financial information determined under GAAP with certain non-GAAP financial measures including (i) earnings before interest, taxes, depreciation, and amortization (“EBITDA”), (ii) Adjusted EBITDA
Slide 13: Adjusted Gross Profit Margin Reconciliation
Adjusted Gross Profit Margin Reconciliation Dollars in Millions, except percentages Three Months Ended December 31, 2022 Gross Profit $188.8 Gross Margin 68.5% Amortization of intangible assets (1) 0.1 Adjusted Gross Profit $188.9 Adjusted Gross Profit Margin 68.5% (1) Amortization of intangible ass
Slide 14: Adjusted Operating Income Margin Reconciliation
Adjusted Operating Income Margin Reconciliation Dollars in Millions, except percentages Three Months Ended December 31, 2022 GAAP Operating Income $88.8 GAAP Operating Income Margin 32.2% Amortization of intangible assets (1) 0.1 One-time stand up costs (2) 10.2 European regulatory initiative-relate
Slide 15: Adjusted Operating Income Margin Reconciliation – Continued
Adjusted Operating Income Margin Reconciliation – Continued (1) Amortization of intangible assets is recorded in Cost of products sold. (2) One-time stand up costs incurred during the three months ended December 31, 2022 primarily include costs to stand up the Company. Approximately $9.9 million of
Slide 16: Adjusted Diluted Net Income Per Share Reconciliation
Adjusted Diluted Net Income Per Share Reconciliation Dollars in Millions, except per share amounts Three Months Ended December 31, 2022 Income Before Income Taxes $56.1 Adjustments: Amortization of intangible assets (1) 0.1 One-time stand up costs (2) 10.2 European regulatory initiative-related cost
Slide 17: Adjusted Diluted Net Income Per Share Reconciliation – Continued
Adjusted Diluted Net Income Per Share Reconciliation – Continued (1) Amortization of intangible assets is recorded in Cost of products sold. (2) One-time stand up costs incurred during the three months ended December 31, 2022 primarily include costs to stand up the Company. Approximately $9.9 millio
Slide 18: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Dollars in Millions, except percentages Three Months Ended December 31, 2022 December 31, 2021 GAAP Net Income $35.2 $98.8 Interest expense, net 25.6 — Income taxes 20.9 17.8 Depreciation and amortization 7.2 8.4 EBITDA $88.9 $125.0 Stock-based compensation expense (1)
Slide 19: Adjusted EBITDA Reconciliation – Continued
Adjusted EBITDA Reconciliation – Continued (1) Represents stock-based compensation expense incurred during the three months ended December 31, 2022 and 2021, respectively. For the three months ended December 31, 2022, $4.6 million is recorded in Selling and administrative expense, $0.6 million is re
Slide 20: Fiscal Year 2023 Updated Financial Guidance Assumptions
Fiscal Year 2023 Updated Financial Guidance Assumptions Dollars in Millions, except percentages Current Prior Interest Expense, Net ~ $115 ~ $115 to ~$120 Adjusted Tax Rate ~ 25% ~ 25% Weighted Average Shares (in millions) ~ 57.7 ~ 57.7 Foreign Exchange EUR/USD ~ 1.06 ~ 0.98 USD/YEN ~ 134 ~ 149 USD/