Sanofi Sa · EURONEXT:SAN
Sanofi Sa — Q3 2015 Earnings Presentation
36 slides from Sanofi Sa's earnings presentation, Oct 29, 2015
Slide 1: Q3 2015 Results
Q3 2015 RESULTS October 29, 2015
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their under
Slide 3: Key Highlights
KEY HIGHLIGHTS Olivier Brandicourt Chief Executive Officer 3
Slide 4: Sanofi Grew Sales and Business EPS in Q3 2015 while Accelerating Investments
Sanofi Grew Sales and Business EPS in Q3 2015 while Accelerating Investments to Drive Future Growth 1 Delivering ● Sales up +3.4% at CER(1) despite Diabetes sales erosion solid sales growth in the U.S. 2 Posting ● Higher OpEx, as expected, driven by investment in launches steady financial results ●
Slide 5: Solid Top and Bottom Lines Growth in Q3 2015
Solid Top and Bottom Lines Growth in Q3 2015 Net Sales Business EPS +€0.05 +€508m €9,591m €1.61 +€0.09 +€302m +3.4% +6.1% at CER(1) at CER(1) €8,781m €1.47 Q3 2014 Incremental FX Impact Q3 2015 Q3 2014 Incremental FX Impact Q3 2015 Sales at CER EPS at CER (1) On a reported basis, Q3 2015 sales were
Slide 6: Broad-based Sales Growth Continues in Q3 2015
Broad-based Sales Growth Continues in Q3 2015(1,2) Q3 2015 Sales by Business Areas % of Sales Growth at CER 75.8% Pharmaceuticals(3) €7,267m +2.6% 19.3% Diabetes €1,852m -6.6% 9.6% Genzyme €923m +32.7% 8.5% Consumer Healthcare €814m +3.2% 4.7% Generics €452m +6.7% 3.9% Oncology €376m +5.4% 29.8% Est
Slide 7: Diabetes Performance in Q3 2015 Reflects Lower U.S. Sales of Lantus
Diabetes Performance in Q3 2015 Reflects Lower U.S. Sales of Lantus® than Expected Q3 2015 Diabetes Sales ● U.S. Lantus® sales(2) impacted by: by Geography (€m) ● Higher discounts as compared to last year ● Slower than expected U.S. basal market Global Diabetes Sales: €1,852m, -6.6% at CER ● Higher
Slide 8: Global Roll-out Underway and Showing Early Promise in Key Markets
Global Roll-out Underway and Showing Early Promise in Key Markets Weekly NBRx Share Weekly Sell Out Share (in Units/Packs) within Basal Market(1) within Basal Market(2) 60% 8% Lantus® 49.8% 7% 6.8% 50% 6% 40% 5% Levemir® Tresiba® 30% 26.8% 4% 3.6% 3% 20% 14.0% 2% 10% NPH 1% 9.4% 0% 0% 1 3 5 7 9 11 1
Slide 9: Genzyme Delivers Strong Q3 2015 with MS Franchise
Genzyme Delivers Strong Q3 2015 with MS Franchise Continuing to More than Double vs. Q3 2014 ● Strong MS sales in Q3 2015 Genzyme Quarterly Sales ● Aubagio® reaching €225m €923m ● Lemtrada® at €68m, sequentially up +24.0% Multiple Sclerosis +32.7% at CER at CER from previous quarter Rare Disease ● E
Slide 10: Vaccines Showed Good Sales Growth in Q3 2015
Vaccines Showed Good Sales Growth in Q3 2015 Sanofi Pasteur Quarterly Sales ● Stable flu vaccines sales of €736m €1,717m +5.5% at CER (+0.3% at CER) in Q3 2015 ● Solid U.S. performance(1), partially offset by €1,451m delayed supply in Western EU and Mexico ● PPH sales up +17.8% at CER driven by stro
Slide 11: Sixth Consecutive Quarter of Growth at Merial
Sixth Consecutive Quarter of Growth at Merial Driven by Strong Performance in Pets Quarterly Sales Growth at CER +14.2% +13.5% +12.7% +11.5% ● Q3 2015 sales of €607m, up +9.3% at +9.3% CER +6.2% ● Companion Animals sales of €401m, up +13.6% at CER ● NexGard® U.S. advertising campaign leads to strong
Slide 12: Double Digit Growth in Emerging Markets and Low Single Digit Growth in the U.S.
Double Digit Growth in Emerging Markets and Low Single Digit Growth in the U.S. in Q3 2015 Q3 2015 Sales by Geography (€m) (2) RoW Emerging Markets Sales by Region Western EU €844m €1,988m -4.5% at CER -1.8% at CER €964m 8.9% 20.7% Emerging €697m Markets (1) €587m €562m 29.9% €2,871m +11.4% at CER U
Slide 13: Early Launch Progress Encouraging with Gradual Uptake
Early Launch Progress Encouraging with Gradual Uptake(1) Consistent with Expectations ● U.S. comprehensive Available in 2 Doses support hub tracking in line with expectations Recommended starting dose ● Over 4,000 prescribers 150 mg 75 mg Increase if needed Q2W ● Preferred Tier 2 formulary position
Slide 14: New Launches More than Offset Lantus Sales Decline in YTD Sep 2015
New Launches More than Offset Lantus® Sales Decline in YTD Sep 2015 YTD Sep 2015 Sales €27,779m €25,579m +€2,200m +€647m -€332m +12.5% reported +€566m +3.6% at CER €24,698m (1) YTD Sep Launches Lantus® Others Q3 2015 FX YTD Sep 2014 at CER 2015 (1) Includes Aubagio®, Lemtrada®, Cerdelga®, Toujeo®, A
Slide 15: Regulatory Submissions for Two High Potential Products Expected by Year End
Regulatory Submissions for Two High Potential Products Expected by Year End Key Regulatory Submissions 1 2 sarilumab Rheumatoid Arthritis Diabetes U.S. (Q4 2015) U.S. (Q4 2015) EU (Q3 2016) EU (Q1 2016) 15
Slide 16: Financial Results
FINANCIAL RESULTS Jérôme Contamine Executive Vice President, Chief Financial Officer 16
Slide 17: FX Tailwind Easing Due to Emerging Market Currencies in Q3 2015
FX Tailwind Easing Due to Emerging Market Currencies in Q3 2015 Quarterly Currency Impact Net Sales(1,2) Business EPS(1,2) +11.2% +15.4% +€910m +9.9% +€0.18 +€782m +10.2% +5.8% +€0.12 +€508m +2.7% +3.4% +€229m +€0.05 +1.5% Q3 2014 Q3 2014 +€0.02 -€81m Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2014 Q1 2015
Slide 18: Q3 2015 Business Operating Income Stable at CER
Q3 2015 Business Operating Income Stable at CER Given Investments to Drive Future Growth % Change % Change €m Q3 2015 Q3 2014 (reported €) (CER) Net sales 9,591 8,781 +9.2% +3.4% Other revenues 89 87 +2.3% -8.0% Cost of sales (2,998) (2,864) +4.7% +2.0% Gross profit 6,682 6,004 +11.3% +4.0% R&D (1,3
Slide 19: Mid-Single Digit Business Net Income Growth at CER in Q3 2015
Mid-Single Digit Business Net Income Growth at CER in Q3 2015 Resulting from Lower Tax Rate % Change % Change €m Q3 2015 Q3 2014 (reported €) (CER) Business operating income 2,783 2,716 +2.5% -0.4% Net financial expenses (105) (139) - - Income tax expense (582) (642) - - Effective tax rate -22.2% -2
Slide 20: Gross Margin Consistent with FY 2015 Expectations
Gross Margin Consistent with FY 2015 Expectations Gross Margin (%) ● Cost of Sales (CoS) of €2,998m 68.4% 69.7% in Q3 2015, up +2.0% at CER ● Gross margin of 69.7% in Q3 2015 reflecting 1.3 pt increase over Q3 2014: ● Positive impact from MS franchise and Vaccines more than offsetting negative impac
Slide 21: OpEx Up +5.0% at CER in YTD Sep 2015 as Expected
OpEx Up +5.0% at CER in YTD Sep 2015 as Expected Operating Expenses (€m) ● Q3 2015 OpEx of €3,816m, up +7.5% at CER R&D €3,816m SG&A €3,339m ● R&D expenses of €1,355m €1,355m (14.1% of sales), up +9.9% at CER, €1,146m driven by dupilumab, ODYSSEY CVOT study and immuno-oncology ● SG&A expenses of €2,
Slide 22: Over €5bn of Free Cash Flow Generated in YTD Q3 2015
Over €5bn of Free Cash Flow Generated in YTD Q3 2015 Net Debt (€m) €1,182m €3,694m €6,014m FCF €9,354m €5,005m €1,383m €7,171m €552m €1,481m €1,009m Net Debt (1) Net Cash from CapEx Proceeds Share Acquisitions, Dividend Other(4) Net Debt (1) Dec 31, 2014 Operating from Issuance Repurchase Licensing,
Slide 23: Outlook for 2015 Reaffirmed
Outlook for 2015 Reaffirmed FY 2015 Business EPS Growth Stable to slightly growing at CER(1,2) FX impact on Business EPS Between +6% and +8%(3) (1) Barring major unforeseen adverse events (2) FY 2014 Business EPS of €5.20 (3) Difference between variation on a reported basis and variation at CER, whe
Slide 24: Appendices: R&D Pipeline
APPENDICES R&D Pipeline SANOFI \%
Slide 25: Late Stage Pipeline – Pharma & Vaccines
Late Stage Pipeline – Pharma & Vaccines Phase III Registration N N N LixiLan patisiran (ALN-TTR02) lixisenatide Clostridium difficile lixisenatide + insulin glargine siRNA inhibitor targeting TTR GLP-1 agonist Toxoid vaccine Fixed-Ratio / Type 2 diabetes Familial amyloidotic polyneuropathy Type 2 di
Slide 26: Early Stage Pipeline – Pharma & Vaccines (Phase II)
Early Stage Pipeline – Pharma & Vaccines Phase II dupilumab N isatuximab Anti-IL4Rα mAb Rabies VRVg Anti-CD38 naked mAb Nasal polyposis; Purified vero rabies vaccine Multiple myeloma Eosinophilic oesophagitis N N SAR156597 GZ402671 Meningitis ACYW conj. IL4/IL13 Bi-specific mAb Oral GCS Inhibitor 2n
Slide 27: Early Stage Pipeline – Pharma & Vaccines (Phase I)
Early Stage Pipeline – Pharma & Vaccines Phase I N N N N GZ402668 SAR566658 GZ402666 SAR422459 GLD52 (anti-CD52 mAb) Maytansin-loaded anti-CA6 mAb neo GAA ABCA4 gene therapy Relapsing multiple sclerosis Solid tumors Pompe Disease Stargardt disease N N N N SAR113244 SAR408701 GZ389988 UshStat® Anti-C
Slide 28: R&D Pipeline Summary Table
R&D Pipeline Summary Table(1) Phase I Phase II Phase III Registration TOTAL Oncology 4 1 0 0 5 Diabetes Solutions 2 0 2 1 5 Cardiovascular / Renal Diseases 1 0 0 0 1 Immune Mediated Diseases 2 1 2 0 5 29 Infectious Diseases 0 1 0 0 1 Ophthalmology 3 0 0 0 3 Rare Diseases 4 2 2 0 8 Age Related Degene
Slide 29: Expected R&D Milestones
Expected R&D Milestones Product Event Timing Dengue vaccine Expected regulatory decision in endemic countries Q4 2015 sarilumab Expected U.S. regulatory submission in Rheumatoid Arthritis Q4 2015 LixiLan Expected U.S. regulatory submission in Diabetes Q4 2015 PR5i vaccine (DTP-HepB-Polio-Hib) Expect
Slide 30: Appendices: Finance
APPENDICES FINANCE SANOFI \%
Slide 31: 2015 Currency Sensitivity
2015 Currency Sensitivity Business EPS Currency Sensitivity Currency Variation Business EPS Sensitivity U.S. Dollar -0.05 USD/EUR +EUR 0.10 Japanese Yen +5 JPY/EUR -EUR 0.03 Russian Ruble +10 RUB/EUR -EUR 0.06 Currency Exposure on Q3 2015 Sales Currency Average Rates Chinese Yuan Russian 5.9% Ruble
Slide 32: Business Net Income Statement – Third Quarter 2015
Business Net Income Statement Third quarter 2015 Group Total Pharmaceuticals Vaccines Animal health Other € million Q3 2015 Q3 2014 change Q3 2015 Q3 2014 change Q3 2015 Q3 2014 change Q3 2015 Q3 2014 change Q3 2015 Q3 2014 Net sales 9,591 8,781 9.2% 7,267 6,815 6.6% 1,717 1,451 18.3% 607 515 17.9%
Slide 33: Business Net Income Statement – Nine Months 2015
Business Net Income Statement Nine months 2015 Group Total Pharmaceuticals Vaccines Animal health Other € million 9M 2015 9M 2014 change 9M 2015 9M 2014 change 9M 2015 9M 2014 change 9M 2015 9M 2014 change 9M 2015 9M 2014 Net sales 27,779 24,698 12.5% 22,522 20,332 10.8% 3,301 2,797 18.0% 1,956 1,56
Slide 34: Reconciliation of Business Net Income to Consolidated Net Income (Q3)
Reconciliation of Business Net Income to Consolidated Net Income Attributable to Equity Holders of Sanofi € million Q3 2015 Q3 2014 Change Business net income 2,096 1,935 8.3% Amortization of intangible assets (1) (598) (561) Impairment of intangible assets (209) (35) Fair value remeasurement of con
Slide 35: Reconciliation of Business Net Income to Consolidated Net Income (9M)
Reconciliation of Business Net Income to Consolidated Net Income Attributable to Equity Holders of Sanofi € million 9M 2015 9M 2014 Change Business net income 5,662 5,019 12.8% Amortization of intangible assets (1) (1,827) (1,862) Impairment of intangible assets (237) (109) Fair value remeasurement
Slide 36: Consolidated Income Statements
Consolidated Income Statements € million Q3 2015 Q3 2014 9M 2015 9M 2014 Net sales 9,591 8,781 27,779 24,698 Other revenues 89 87 252 241 Cost of sales (2,998) (2,864) (8,722) (7,988) Gross profit 6,682 6,004 19,309 16,951 Research and development expenses (1,355) (1,146) (3,844) (3,473) Selling and