Emergent Biosolutions Inc. · NYSE:EBS
Emergent Biosolutions — Q2 2020 Earnings Presentation
46 slides from Emergent Biosolutions's earnings presentation, Jul 30, 2020
Slide 1: Appendix To 2Q/YTD20 Financial Results
Appendix To 2Q/YTD20 Financial Results July 30, 2020
Slide 2: Safe Harbor Statement
Safe Harbor Statement Safe-Harbor Statement This presentation may include forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Except for historical matters contained herein, statements in this presentation are forward-looking. In
Slide 3: 2Q20 Supplemental Financial Slides
2Q20 Supplemental Financial Slides
Slide 4: Primary financial metrics – 2Q
Primary financial metrics – 2Q [$M] Total Revenue Adj. EBITDA1 Adj. Net Income1 $395 $157 $220 $243 $106 $81 $55 $25 $6 2Q18 2Q19 2Q20 2Q18 2Q19 2Q20 2Q18 2Q19 2Q20 1. See the Appendix for a definition of non-GAAP terms and reconciliation tables. 4 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 5: Total revenue mix – 2Q
Total revenue mix – 2Q Product Sales Contract Manufacturing 2Q18 2Q19 2Q20 C&G [$M] $17 $41 $24 $24 $73 $19 $220 $243 $395 $180 $183 $299 7% 6% 11% 17% 18% 8% $220 $243 $395 82% 75% 76% 5 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 6: Total revenue – Sources mix – 2Q
Total revenue – Sources mix – 2Q US Government Revenues Non-US Government Revenues 2Q18 2Q19 2Q20 [$M] $35 $105 $110 $220 $243 $133 $395 $185 $290 16% 27% 45% $220 $243 55% $395 84% 73% 6 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 7: Product sales mix – 2Q
Product sales mix – 2Q Anthrax vaccines ACAM2000 NARCAN Nasal Spray Other products [$M] 2Q18 2Q19 2Q20 $20 $12 $24 $22 $59 $46 $73 $132 $180 $183 $299 $138 $66 $70 7 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 8: Key margins – 2Q
Key margins – 2Q Gross Net R&D1 SG&A 56% 65% 29% 50% 11% 18% 19% 7% 4% 2Q18 2Q19 2Q20 2Q18 2Q19 2Q20 2Q18 2Q19 2Q20 1. Net R&D is calculated as gross R&D less contracts & grants revenue; net R&D margin is calculated as net R&D as a function of adjusted revenue, which is calculated as total revenue l
Slide 9: Key financial metrics – 2Q (expressed as TTM)
Key financial metrics – 2Q (expressed as TTM) [$M] Total Revenue Adj. EBITDA Adj. Net Income $1,259 $419 $259 $1,016 $1,106 $1,108 $280 $287 $220 $152 $158 $108 3Q19 4Q19 1Q20 2Q20 3Q19 4Q19 1Q20 2Q20 3Q19 4Q19 1Q20 2Q20 Gross Margin 55% 56% 57% 61% 3Q19 4Q19 1Q20 2Q20 1. See the Appendix for a defi
Slide 10: YTD20 (As of June 30) Supplemental Financial Slides
YTD20 (As of June 30) Supplemental Financial Slides
Slide 11: Primary financial metrics – YTD
Primary financial metrics – YTD [$M] Total Revenue Adj. EBITDA1 Adj. Net Income1 $587 $172 $434 $107 $338 $84 $53 $33 $0 6M18 6M19 6M20 6M18 6M19 6M20 6M18 6M19 6M20 1. See the Appendix for a definition of non-GAAP terms and reconciliation tables. 11 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/20
Slide 12: Total revenue mix – YTD
Total revenue mix – YTD Product Sales Contract Manufacturing 6M18 6M19 6M20 C&G [$M] $32 $63 $46 $50 $35 $94 $338 $434 $587 $256 $336 $447 10% 14% 8% 15% 8% 16% $338 $434 $587 76% 78% 76% 12 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 13: Total revenue – Sources mix – YTD
Total revenue – Sources mix – YTD US Government Revenues Non-US Government Revenues 6M18 6M19 6M20 [$M] $72 $212 $338 $207 $434 $227 $587 $375 $266 21% 36% $338 48% $434 52% $587 64% 79% 13 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 14: Product sales mix – YTD
Product sales mix – YTD Anthrax vaccines ACAM2000 NARCAN Nasal Spray Other products [$M] 6M18 6M19 6M20 $20 $12 $48 $22 $46 $184 $256 $336 $66 $145 $447 $212 $214 $70 14 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 15: Key margins – YTD
Key margins – YTD Gross Net R&D1 SG&A 62% 52% 48% 31% 25% 13% 24% 7% 8% 6M18 6M19 6M20 6M18 6M19 6M20 6M18 6M19 6M20 1. Net R&D is calculated as gross R&D less contracts & grants revenue; net R&D margin is calculated as net R&D as a function of adjusted revenue, which is calculated as total revenue
Slide 16: Additional Historical Financial Slides
Additional Historical Financial Slides
Slide 17: Total revenue
Total revenue $1,200,000 $1,200,000 Contracts & Grants $1,000,000 $1,000,000 $800,000 $800,000 $600,000 $600,000 CDMO $400,000 $400,000 $200,000 $200,000 Total Revenue Product Sales $0 $0 2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 2019 17 APPENDIX TO 2Q20 FINANCIAL RE
Slide 18: Total revenue mix
Total revenue mix Product Sales Contract Manufacturing 2017 2018 2019 C&G [$M] $70 $77 $122 $69 $99 $80 $561 $782 $1106 $422 $606 $904 13% 10% 11% 13% 7% 12% $561 $782 $1106 75% 77% 82% 18 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 19: Product sales mix
Product sales mix Anthrax vaccines ACAM2000 2017 2018 2019 NARCAN Nasal Spray Other products $123 $208 $173 [$M] $170 $422 $607 $278 $904 $12 $42 $287 $243 $117 $280 29% 23% 19% 28% $422 $607 46% $904 3% 7% 68% 27% 19% 31% 19 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 20: Total revenue – Sources mix
Total revenue – Sources mix US Government Revenues Non-US Government Revenues 2017 2018 2019 [$M] $121 $185 $431 $561 $782 $1106 $675 $440 $598 22% 24% 39% $561 $782 $1106 61% 78% 76% 20 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 21: Total revenue – Geographic mix
Total revenue – Geographic mix US Revenues Ex-US Revenues 2017 2018 2019 [$M] $62 $70 $111 $561 $782 $1106 $499 $712 $995 11% 9% 10% $561 $782 $1106 89% 91% 90% 21 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 22: Product sales mix
Product sales mix 2017 2018 2019 Anthrax Vax. $287 Anthrax Vax. $278 Anthrax Vax. $173 ACAM2000 $12 ACAM2000 $117 ACAM2000 $243 NARCAN $- NARCAN $42 NARCAN $280 Other Prod. $123 Other Prod. $170 Other Prod. $208 $0 $100 $200 $300 $400 $0 $100 $200 $300 $400 $0 $100 $200 $300 $400 Total revenue: ~$56
Slide 23: Gross Profit & Gross Margin
Gross Profit & Gross Margin [$M] $550 $383 $334 $270 $303 $170 $196 $216 $219 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 79% 77% 73% 69% 63% 62% 62% 54% 56% 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 23 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 24: Net R&D
Net R&D1,3 [Absolute Dollar & Margin (% of Adjusted Revenue)] [$M] $92 $66 Positive $44 $34 $27 $27 $13 $2 $35M 2 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 16% 10% 9% 9% 8% 4% 5% 0% 0% 2 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 1. Net R&D is calculated as gross R&D expense minus contracts
Slide 25: SG&A
SG&A [Absolute Dollar & Margin (% of Total Revenue)] [$M] $274 $202 $121 $144 $143 $146 $87 $109 $75 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 27% 28% 27% 25% 29% 25% 26% 25% 25% 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 25 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 26: Adjusted EBITDA
Adjusted EBITDA1 [Absolute Dollar & Margin (% of Total Revenue)] [$M] $279 $176 $176 $200 $156 $171 $136 $109 $79 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 35% 33% 36% 32% 31% 28% 26% 25% 29% 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 26 APPENDIX TO 2Q20 FINANCIAL RESULTS 1. See the Appendi
Slide 27: Adjusted Net Income
Adjusted Net Income1 [Absolute Dollar & Margin (% of Total Revenue)] [$M, unless otherwise indicated] $152 $123 $106 $99 $96 $77 $70 $78 $59 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 21% 25% 20% 17% 16% 17% 16% 14% 18% 2012 2013 2014 2015 2016 2017 2018 2019 6M2020 27 APPENDIX TO 2Q20 FINANCIAL
Slide 28: Cash + Accounts Receivable
Cash + Accounts Receivable [$M] Accounts Receivable Cash $259 $114 $139 $271 $144 $263 $308 $272 $269 $178 $168 $112 2015 2016 2017 2018 2019 6M2020 28 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 29: CAPEX
CAPEX [Absolute Dollar & Margin (% of Total Revenue)] [$M] $76 $87 $72 $55 $59 $45 $31 2014 2015 2016 2017 2018 2019 6M2020 16% 9% 10% 9% 10% 8% 8% 2014 2015 2016 2017 2018 2019 6M2020 29 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 30: Operating Cash Flow
Operating Cash Flow [$M] $208 $188 $186 $55 $42 2016 2017 2018 2019 6M2020 30 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 31: Total Debt
Total Debt [$M] $809 $823 $787 $14 2017 2018 2019 6M2020 31 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 32: Depreciation and amortization
Depreciation and amortization [$M] $111 $62 $57 $32 $35 $38 $43 2014 2015 2016 2017 2018 2019 6M2020 32 APPENDIX TO 2Q20 FINANCIAL RESULTS AS OF 07/30/2020
Slide 33: Appendix
“™~ emergent biosolutionse Appendix
Slide 34: Reconciliation of Net Income to Adjusted EBITDA – 2Q20, 2Q19, 2Q18
Reconciliation of Net Income to Adjusted EBITDA – 2Q20, 2Q19, 2Q18 Three Months Ended June 30, ($ in millions) 2020 2019 2018 Net Income (Loss) $92.7 ($9.5) $50.1 Adjustments: + Depreciation & Amortization 28.6 27.2 12.2 + Total Interest Expense, net 6.3 8.8 1.0 + Provision (Benefit) for (from) Inco
Slide 35: Reconciliation of Net Income to Adjusted EBITDA – 6M20, 6M19, 6M18
Reconciliation of Net Income to Adjusted EBITDA – 6M20, 6M19, 6M18 Six Months Ended June 30, ($ in millions) 2020 2019 2018 Net Income (Loss) $80.2 ($35.6) $45.2 Adjustments: + Depreciation & Amortization 56.8 53.8 24.5 + Total Interest Expense, net 14.1 17.8 1.2 + Provision (Benefit) for (from) Inc
Slide 36: Reconciliation of Net Income to Adjusted EBITDA – YTD2020 to 2012
Reconciliation of Net Income to Adjusted EBITDA – YTD2020 to 2012 Twelve Months Ended December 31, ($ in millions) YTD2020 2019 2018 2017 2016 2015 2014 2013 2012 Source Net Income $80.2 $54.5 $62.7 $82.6 $62.5 $91.4 $54.3 $71.2 $58.2 NA Adjustments: + Depreciation & Amortization 56.8 110.7 61.3 40.
Slide 37: Reconciliation of Net Income to Adjusted EBITDA – 2020 Guidance
Reconciliation of Net Income to Adjusted EBITDA – 2020 Guidance REVISED 2020 Full Year ($ in millions) Forecast 2020F Net Income $290 - $340 Adjustments: + Depreciation & Amortization 115 + Total Interest Expense, net 30 + Provision for Income Taxes 98 - 113 + Changes in fair value of contingent con
Slide 38: Reconciliation of Net Income to Adjusted Net Income – 2Q20, 2Q19, 2Q18
Reconciliation of Net Income to Adjusted Net Income – 2Q20, 2Q19, 2Q18 Three Months Ended June 30, ($ in millions) 2020 2019 2018 Source Net Income (Loss) $92.7 ($9.5) $50.1 NA Adjustments: + Non-cash amortization charges 15.8 15.4 4.0 SG&A, Other Income + Change in fair value of contingent consider
Slide 39: Reconciliation of Net Income to Adjusted Net Income – 6M20, 6M19, 6M18
Reconciliation of Net Income to Adjusted Net Income – 6M20, 6M19, 6M18 Six Months Ended June 30, ($ in millions) 2020 2019 2018 Source Net Income (Loss) $80.2 ($35.6) $45.2 NA Adjustments: + Non-cash amortization charges 31.3 30.7 8.0 SG&A, Other Income + Change in fair value of contingent considera
Slide 40: Reconciliation of Net Income to Adjusted Net Income – YTD2020 to 2012
Reconciliation of Net Income to Adjusted Net Income – YTD2020 to 2012 Twelve Months Ended December 31, ($ in millions) YTD2020 2019 2018 2017 2016 2015 2014 2013 2012 Source Net Income $80.2 $54.5 $62.7 $82.6 $62.5 $91.4 $54.3 $71.2 $58.2 NA Adjustments: Intangible Asset + Non-cash amortization char
Slide 41: Reconciliation of Net Income to Adjusted Net Income – 2020 Guidance
Reconciliation of Net Income to Adjusted Net Income – 2020 Guidance REVISED 2020 Full Year Forecast ($ in millions) 2020F Source Net Income $290 - $340 NA Adjustments: IA Amort.; Other + Non-cash amortization charges 62 Income + Change in fair value of contingent consideration 2 SG&A + Acquisition-r
Slide 42: Reconciliation of Net R&D Expense – 2Q20, 2Q19, 2Q18
Reconciliation of Net R&D Expense – 2Q20, 2Q19, 2Q18 Three Months Ended June 30, ($ in millions) 2020 2019 2018 Research and Development Expenses $47.9 $63.9 $24.7 Adjustments: - Contracts and Grants revenue $23.6 41.0 16.5 Net Research and Development Expenses $24.3 $22.9 $8.2 Adjusted Revenue $371
Slide 43: Reconciliation of Net R&D Expense – 6M20, 6M19, 6M18
Reconciliation of Net R&D Expense – 6M20, 6M19, 6M18 Six Months Ended June 30, ($ in millions) 2020 2019 2018 Research and Development Expenses $90.6 $110.0 $53.8 Adjustments: - Contracts and Grants revenue 46.2 $62.8 32.4 Net Research and Development Expenses $44.4 $47.2 $21.4 Adjusted Revenue $541
Slide 44: Reconciliation of Net R&D and Net R&D Margin – YTD2020 to 2012
Reconciliation of Net R&D and Net R&D Margin – YTD2020 to 2012 Twelve Months Ended December 31, ($ in millions) 6M2020 2019 2018 2017 2016 2015 2014 2013 2012 Research and Development Expenses $90.6 &226.2 $142.8 $97.4 $106.9 $117.8 $103.5 $81.8 $96.4 Adjustments: - Contracts and Grants revenue 46.2
Slide 45: Glossary of terms
Glossary of terms Term Definition ANVISA National Health Surveillance Agency Brazil BARDA Biomedical Advanced Research and Development Authority BMGS Federal Ministry of Health Germany BSL3 A biosafety level of biocontainment precautions required to isolate dangerous agents in an enclosed laboratory
Slide 46: Glossary of terms
Glossary of terms Term Definition EMA European Medicines Agency EUA Emergency Use Authorization FDA U.S. Food and Drug Administration GAAP U.S. Generally Accepted Accounting Principles HHS U.S. Department of Health and Human Services M&A Mergers and acquisitions MCS Medical Countermeasure Systems MC
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