Slide 1: Alcon, Inc.
Alcon, Inc. Worldwide Leader in Ophthalmic Research and Manufacturing
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements contained in this presentation that are forward-looking are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. This presentation is being made on July 28, 2005, and Alcon does not undertake
Slide 3: Management Presentation by
Management Presentation by Cary Rayment Chairman, President & CEO Jacqualyn Fouse Senior Vice President of Finance & CFO 3
Slide 4: Second Quarter Financial Highlights
Second Quarter Financial Highlights Q2 05 Q2 04* Growth Global Sales $ 1,172.0 $1,039.2 12.8% Net Earnings $ 325.0 $ 241.6 34.5% Diluted EPS $ 1.04 $ 0.78 33.3% *2004 excludes the impact of tax settlements and tax credits of $57.6 million recorded in Q2 2004. This is a non-GAAP measure and is provid
Slide 5: AcrySof ReSTOR Update
AcrySof® ReSTOR® Update • U.S. shipments commenced in mid-May 2005 • 2,200 physicians trained to date • 1,300 physicians completed all requirements • Positive physician and patient response • CMS decision increased access to U.S. Medicare population 5
Slide 6: 2005 AcrySof ReSTOR Updated Guidance
2005 AcrySof® ReSTOR® Updated Guidance Full year 2005 global sales guidance • Previous Guidance: $35 to $45 million • New Guidance: $45 to $55 million 6
Slide 7: AcrySof ReSTOR - Alcon Strategy
AcrySof® ReSTOR® - Alcon Strategy 2005 Focus • Increase number of physicians trained and qualified to implant • Ensure a positive physician and patient experience Longer-Term Focus • Physician practice development • Technology enhancements • Expanding patient education/awareness of technology 7
Slide 8: RETAANE Regulatory Update
RETAANE® Regulatory Update • Received approvable letter in late May 2005 • Initial meeting to discuss letter held July 21st • Continue negotiations with FDA to determine requirements for approval • EU and other international submissions filed and pending regulatory decisions 8
Slide 9: RETAANE Clinical Update
RETAANE® Clinical Update • Q4 2005 - 24 month data from head to head PDT trial • Q1 2006 - South American trial 12 month data • 1H 2007 - EU trial 12 month data (enrolling) • 2H 2007 - Interval study data (enrolling) • 1,900 of planned 2,500 patients enrolled in risk reduction study 9
Slide 10: Q2 2005 Sales and Growth by Business Unit
Q2 2005 Sales and Growth by Business Unit Reported Constant Sales Growth Currency Global Sales $ 1,172.0 12.8% 10.1% United States $ 594.9 8.2% 8.2% International $ 577.1 17.9% 12.3% Note: Constant currency sales growth is a non-GAAP measure presented (dollars in millions) to give investors a better
Slide 11: 2005 YTD Sales and Growth by Business Unit
2005 YTD Sales and Growth by Business Unit Reported Constant Sales Growth Currency Global Sales $ 2,242.5 12.0% 9.4% United States $ 1,116.1 7.9% 7.9% International $ 1,126.4 16.3% 11.0% Note: Constant currency sales growth is a non-GAAP measure presented (dollars in millions) to give investors a be
Slide 12: Geographic Sales Breakdown
Geographic Sales Breakdown June 2005 YTD June 2004 YTD 28.7% 27.8% 49.8% 51.7% 7.1% 7.5% 14.4% 13.0% United States United States EURMEA EURMEA Japan Japan Rest of World Rest of World 12
Slide 13: Sales by Market Development
Sales by Market Development June 2005 YTD Reported June 2005 YTD Constant Growth Rate Currency Growth Rate 30% 25% 25% 27% 20% 21% 20% 15% 15% 10% 10% 12% 9% 10% 5% 8% 5% 0% 0% Alcon Developed Emerging Alcon Developed Emerging Group Markets Markets Group Markets Markets Emerging markets contributed
Slide 14: Pharmaceutical Sales
Pharmaceutical Sales $1,000 +14.0% $800 $934.6 $819.6 $600 +14.1% $400 $502.6 $440.5 $200 $0 Q2 2004 Q2 2005 YTD 2004 YTD 2005 (dollars in millions) 14
Slide 15: Surgical Sales
Surgical Sales $1,200 +11.7% $1,000 $1,009.1 $800 $903.0 $600 +13.4% $400 $520.8 $459.1 $200 $0 Q2 2004 Q2 2005 YTD 2004 YTD 2005 (dollars in millions) 15
Slide 16: Consumer Sales
Consumer Sales $350 +6.6% $300 $250 $298.8 $280.2 $200 +6.4% $150 $100 $139.6 $148.6 $50 $0 Q2 2004 Q2 2005 YTD 2004 YTD 2005 (dollars in millions) 16
Slide 17: Q2 2005 Income Statement Detail
Q2 2005 Income Statement Detail % of % of Q2 05 Sales Q2 04 Sales Gross Profit $ 884.3 75.5% $ 765.0 73.6% SG & A $ 341.8 29.2% $ 312.3 30.1% Research & Development $ 100.8 8.6% $ 89.3 8.6% Operating Profit $ 419.8 35.8% $ 347.7 33.5% (dollars in millions) 17
Slide 18: Q2 YTD 2005 Income Statement Detail
Q2 YTD 2005 Income Statement Detail % of % of YTD 05 Sales YTD 04 Sales Gross Profit $1,666.2 74.3% $1,438.8 71.8% SG & A $ 678.3 30.2% $ 603.1 30.1% Research & Development $ 199.3 8.9% $ 180.2 9.0% Operating Profit $ 746.6 33.3% $ 624.3 31.2% (dollars in millions) 18
Slide 19: Tax Rate Analysis
Tax Rate Analysis Full Year YTD 2005 2004 Reported effective tax rate 23.5% 22.6% Non-GAAP adjustment -- 5.1% *Adjusted effective tax rate 23.5% 27.7% *Adjusted effective tax rate is a non-GAAP measure presented to give investors a better comparison of income taxes between years. (dollars in million
Slide 20: Non-GAAP Adjustments
Non-GAAP Adjustments Q2 04 Net Q2 04 Earnings EPS Reported $ 299.2 $ 0.96 Non-GAAP Adjustments ($57.6) ($0.18) Adjusted Non-GAAP* $ 241.6 $ 0.78 *Adjustments for tax settlements and credits booked in Q2 2004 are non-GAAP measures and are provided to help investors better compare results of operation
Slide 21: Balance Sheet Highlights
Balance Sheet Highlights 6/30/05 12/31/04 Short and Long Term Borrowings $ 1,164.6 $ 988.0 Cash and Cash Equivalents $ 1,210.6 $ 1,093.4 Consolidated S/H Equity $ 2,332.0 $ 2,187.9 A/R Change (From 12/31/04) 18.2% N/A Inventory Change (From 12/31/04) (10.2%) N/A (dollars in millions) 21
Slide 22: Cash Flow Highlights
Cash Flow Highlights YTD 2005 YTD 2004 Net Cash From Operations $ 653.5 $ 462.3 Net Cash From Investing $ (286.7) $ (121.1) Free Cash Flow* $ 366.8 $ 341.2 *Free cash flow is a non-GAAP term defined as net cash from operations less net cash from (dollars in millions) investing. Free cash flow is pre
Slide 23: 2005 Outlook
2005 Outlook Alcon 2;
Slide 24: 2005 Full Year Financial Guidance: Sales
2005 Full Year Financial Guidance • Sales range from $4.35 to $4.40 billion – Global growth across major product lines – Share gains from recent product launches – AcrySof® ReSTOR® sales – Ciloxan® impact predominantly 1H05 – Nominal to slightly negative currency impact in 2H05 24
Slide 25: 2005 Full Year Financial Guidance: EPS
2005 Full Year Financial Guidance • EPS range from $3.40 to $3.45 – Higher gross margin from product mix and production efficiencies – Ciloxan® impact predominantly 1H05 – Stable to slightly improving SG&A – Lower effective tax rate 25
Slide 26: Alcon, Inc.
Alcon, Inc. \X/orldwide Leader y in Ophthalmic Beseayen and Manufacturing