Slide 1: Investor Presentation Q2 & H1FY21
Investor Presentation Q2 & H1FY21 6th November 2020 BSE: 524404 | NSE: MARKSANS | ISIN: INE750C01026 ©2019 – Marksans Pharma Limited, All Rights Reserved.
Slide 2: Safe Harbor
Safe Harbor Certain statements in this presentation concerning our future growth prospects are forward looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward looking statements. The company's results may
Slide 3: Q2FY21 Highlights
Q2FY21 Highlights 36.3% 109.5% (YoY) (YoY) Mark Saldanha Managing Director And CEO Revenue EBITDA “The Company turned in another quarter of exemplary performance and this was evidenced by a 36% revenue PAT Cash growth and a record EBITDA of Rs. 86.8 crore. I feel all the more delighted as it came in
Slide 4: Operational Excellence leading to positive margin & return ratios
Operational Excellence leading to positive margin & return ratios EBITDA & PAT Margin ROCE 29.4% EBITDA Margin 22.7% 24.5% PAT Margin 17.0% 20.0% 13.6% 14.5% 9.5% 10.6% 12.1% 8.0% 3.9% Mar-18 Mar-19 Mar-20 Sep-20 Mar-18 Mar-19 Mar-20 Sep-20 Net Debt to EBITDA (x) ROE 22.8% 0.89 18.6% 0.49 14.6% 7.5%
Slide 5: Agenda
Agenda Q2 & H1 FY21 Performance Review Operational review and financials Company at a glance Long-term strategy Research & development Segmental revenue composition Investment rationale ©2020 – Marksans Pharma Limited, All Rights Reserved. 5
Slide 6: Q2 & H1 FY21 Performance Review
Q2 & H1 FY21 Performance Review ©2020 – Marksans Pharma Limited, All Rights Reserved. 6
Slide 7: Growth in Profitability
Growth in Profitability In Rs. Cr. Q2FY21 Q2FY20 YoY Growth (%) H1FY21 H1FY20 YoY Growth (%) Total Revenue 360.1 264.3 36.3% 691.5 511.5 35.2% EBITDA 86.8 41.4 109.5% 157.0 76.0 106.5% EBITDA Margin% 24.1% 15.7% 843 bps 22.7% 14.9% 784 bps PAT 50.7 26.0 95.4% 100.1 48.5 106.6% PAT Margin% 14.1% 9.8%
Slide 8: Financials
Financials CONSOLIDATED (₹ Cr.) Q2’21 Q1’21 Q2’20 H1FY'21 H1FY'20 Total Revenue 360.1 331.3 264.3 691.5 511.5 Material Consumption 163.7 139.6 132.6 303.3 256.9 Gross Profit 192.8 191.6 123.7 384.4 244.5 Gross Margin % 54.1% 57.9% 48.3% 55.9% 48.8% Operating Expenses 109.6 121.6 90.2 231.2 178.5 EBI
Slide 9: Business Review
Business Review Mix In Rs. Cr. H1FY21 H1FY20 YoY Growth (%) (H1FY21) % Europe, UK – Formulations 286.0 225.2 27.0% 41.4% US & North America – Formulations 302.5 203.4 48.7% 43.7% Australia & NZ – Formulations 69.4 61.9 12.1% 10.0% Rest of World (ROW) 33.6 21.0 60.4% 4.9% Consolidated Revenue from op
Slide 10: Operational review and financials
Operational review and financials ©2020 – Marksans Pharma Limited, All Rights Reserved. 10
Slide 11: Consolidated Revenue up 35.2% in H1FY21 led by Strong Growth in all Geographies
Consolidated Revenue up 35.2% in H1FY21 led by Strong Growth in all Geographies Revenue (₹ Cr.) Topline driven by key geographies 13.6% H1FY21 691.5 • The revenue growth in H1FY21 was driven by increasing market share in all the key geographies FY20 1,134.5 CAGR FY19 1,004.7 US Region: FY18 913.1 •
Slide 12: EBITDA Margin Increased by bps during H1 FY21 – Strong Growth Expected in FY 21
EBITDA Margin Increased by 784 bps during H1 FY21 – Strong Growth Expected in FY 21 EBITDA (₹ Cr.) EBITDA Margin (%) Steady growth in the profitability 22.7% H1FY21 157.0 54.9% 17.0% • Gross margin improved from 48.8% during FY20 192.6 13.6% H1FY20 to 55.9% in H1FY21 due to better product 9.5% mix i
Slide 13: Balance Sheet Trends (Sep 20 vs Mar 20)
Balance Sheet Trends (Sep 20 vs Mar 20) Particulars RoE RoCE Net Debt to EBITDA Sep-20 Mar-20 (₹ Cr.). 22.8% 29.4% Net Worth 738.4 636.0 18.6% 24.5% Capital 783.1 677.2 Employed -0.39 -0.48 Net debt -132.5 -74.9 Mar 20 Sep 20 Mar 20 Sep 20 Mar 20 Sep 20 Cash & Bank Ratios calculated using standardiz
Slide 14: Company at a glance
Company at a glance ©2020 – Marksans Pharma Limited, All Rights Reserved. 14
Slide 15: Company Overview
Company Overview Business Description Business Model • 95% of revenues comes from regulated • Marksans Pharma Ltd., headquartered at Mumbai, is engaged in Research, markets Manufacturing & Marketing of generic pharmaceutical formulations • Key focus areas lie in OTC & prescription (Rx) drugs • Forwa
Slide 16: Marksans Pharma Evolution
Marksans Pharma Evolution Investment Phase Consolidation Phase Recovery Phase Growth Phase FY05 - 09 FY10 - 12 FY13 - 16 FY17 - 20 • Acquired 3 companies: • Integration of acquired • Acquired Time-Cap • The Company crossed Rs 1. Nova Pharmaceuticals companies was running Laboratories Inc. 1,000 cror
Slide 17: Business Model
Business Model Focus on Regulated Forward integrated Wider product basket Markets business model • Marksans commenced business • Marksans commenced • Marksans commenced its journey with CRAMS directed at the UK operations as a formulations with products addressing the pain and Australian markets man
Slide 18: Company Structure
Company Structure Marksans Pharma (UK) Limited Marksans Holdings Limited 85+ product Distribution of quality licenses; generic pharma; only OTC; Wholesale Regional sales development Manufacturer of distributor of Manufacturer of range of across Asia (China, Japan, OTC Liquids & generic pharma OTC &
Slide 19: Manufacturing Capabilities
Manufacturing Capabilities Goa, India Southport, UK Farmingdale, USA • Manufactures oral solid tablets and soft • Manufactures non-sterile liquids, • Manufactures soft gels, tablets and gelatin capsules ointments and powder products capsules • One of the biggest manufacturing facility • Supplies to
Slide 20: Long-term strategy
Long-term strategy ©2020 – Marksans Pharma Limited, All Rights Reserved. 20
Slide 21: Strategic focus on Regulated Markets
Strategic focus on Regulated Markets Marksans Pharma generates ~95% of its revenues from regulated markets • Marksans Pharma entered into strategic tie-ups and acquired key players in major markets to expand its global footprint • Company can generate higher margins by eliminating third parties from
Slide 22: Niche Formulations with few Competitors
Niche Formulations with few Competitors Marksans Pharma is currently one of the most active Indian firms focused in Softgel segment • Differentiated offerings: Focused on softgel capsules with a view to build a differentiated set of offerings in the crowded generics market • Limited competition - Gi
Slide 23: Forward Integrated Business Model
Forward Integrated Business Model R&D and Manufacturing Goa & Mumbai* (India) Southport (UK) Farmingdale (US) Supply chain and EXPORT distribution Australasia UK/Europe UK & Europe North America / Canada ROW End Consumers Retail chains Pharmacy stores Hospitals *Mumbai has only R&D center in Navi Mu
Slide 24: Research & development
Research & development ©2020 – Marksans Pharma Limited, All Rights Reserved. 24
Slide 25: R&D and Product Launches Highlights
R&D and Product Launches Highlights Continued focus on R&D investments leading to a robust pipeline of new developed & pipeline products R&D Expenditure (₹ Crores) Recent key product launches Brand Composition Therapy Segment Market 14.6 1.5% ADALAT Nifedipine SGC – 5mg, 10mg Cardiovascular UK 8.3 4
Slide 26: Segmental revenue composition
Segmental revenue composition ©2020 – Marksans Pharma Limited, All Rights Reserved. 26
Slide 27: Global Reach Enables Reduction in Country Risk
Global Reach Enables Reduction in Country Risk REVENUE MIX Europe, UK US, North America Australia, NZ RoW Company’s business is 3% 6% 4% 6% 4% classified under 4 heads: 12% 14% 11% 12% 12% • North America/ US generics • Europe/UK generics 36% 41% 39% 45% 41% • Australia and New Zealand • Rest of the
Slide 28: The UK
The UK is the highest contributor to Marksans Pharma’ s revenues Overview of the market • The UK & EU pharmaceutical market is estimated to grow from ~USD 468 billion in 2016 to ~USD 585 billion by 2030, at a CAGR of 1.6%, driven primarily by a robust life sciences 510.0 industry* Company presence T
Slide 29: The United States
Marksans is among a few Indian players with a proprietary marketing presence in the US Overview of the market • The US holds over 30-40% of the global pharmaceutical market. It is expected to reach USD 190.4 billion by 2024, at a The projected CAGR of 10.6% during 2019-2024, due to favorable United
Slide 30: Australia and New Zealand
Australia and NZ region continue to deliver high teens growth in FY20 Overview of the market • Australia’s pharmaceutical market is set to rise from $30.5 billion in 2018 to US$ 40.1 billion by 2024 registering a CAGR Australia of 5.1%* and New 140.7 Company presence Total Revenues Zealand (र Cr.) •
Slide 31: Rest of the world
After harnessing the regulated markets, Marksans is venturing out in the emerging countries Overview of the markets • ROW includes markets of South East Asia, MENA, Russian Federation & Africa Rest of 47.4 Company presence Total Revenues the world (र Cr.) • Targeting four major clusters such as Sout
Slide 32: Investment Rationale
Investment Rationale ©2020 – Marksans Pharma Limited, All Rights Reserved. 32
Slide 33: Investment Rationale
The US, the UK and Company is widening its Australia are the key products portfolio in the Marksans’ markets with all of complex and high-margin them being now empowered generics segment with all regulatory approvals Marksans is among a few Marksans is among a mid and small-sized pharma handful of I
Slide 34: Investor Relations Team at Marksans Pharma
Investor Relations Team at Marksans Pharma Jitendra Sharma, CFO Dikshita Jain Marksans Pharma Ltd Christensen Investor Relations Tel: +91 022 40012000 Tel : +91 22 4215 0210 jitendra@marksanspharma.com djain@christensenir.com Corporate Office: 11th Floor Grandeur, Off Veera Desai Road, Opp Gundecha