Slide 1: Beyond continuity
Beyond continuity 2019 full-year results conference Basel, 18 February 2020
Slide 2: Disclaimer
Disclaimer This presentation contains certain forward-looking statements that reflect the current views of management. Such statements are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Straumann Group to differ m
Slide 3: Agenda
Agenda Full-year highlights Business and regional review Recent achievements & strategy in action Outlook 2020 Q&A and upcoming events
Slide 4: Full-year highlights
Full-year highlights Guillaume Daniellot, CEO
Slide 5: Excellent growth and further margin expansion
Excellent growth and further margin expansion REVENUE ORGANIC1 GROWTH EBIT MARGIN CHF 1.6bn +17% 27.1% (core2) +17% vs. 2018 2.5% negative FX effect Core profitability further improved Q4: +17% IFRS EBIT margin: 24.3% INNOVATION BUILDING FOR GROWTH OUTLOOK3 Straumann BLX CAPEX: CHF 150m Further shar
Slide 6: Strong fourth quarter despite high baseline
Strong fourth quarter despite high baseline Organic revenue growth EMEA NAM FY 2019 13.4% FY 2019 19.8% Q4 2019 13.4% Q4 2019 19.4% APAC FY 2019 21.5% Q4 2019 24.5% LATAM FY 2019 16.8% Q4 2019 13.4% Group FY 2019 17.1% Q4 2019 17.1% 6
Slide 7: Continued value creation for shareholders
Continued value creation for shareholders Revenue growth EBIT margin Earnings per share in CHF m Core, in %, excl FX Core, in CHF +17% +20bps +17% organic 1596.2 21.21 1363.6 26.9 27.1 18.16 FY 2018 FY 2019 FY 2018 FY 2019 FY 2018 FY 2019 7
Slide 8: Impressive 5-year performance
Impressive 5-year performance 5-year organic revenue growth 5-year EBIT1 in CHF m 5-year net profit1 in CHF m and margin and margin Average +15% +4%-points +3%-points 18.9% 550 17.1% 600 26.9% 27.1% 15.7% 25.7% 21.5% 24.8% 450 20.7% 21.2% 500 20.4% 13.1% 23.3% 400 350 18.1% 9.1% 300 250 Market 200 1
Slide 9: Leadership in implant dentistry extended
Leadership in implant dentistry extended 2019 Total Implantology1 dentistry Straumann Others (400+) Group 20% (2018: 25%) 26% Market CHF 27-29 bn 4.6 bn Dentium 6% 26% 5% Straumann share Zimmer Biomet 5% Straumann position #6 #1 8% 17% Osstem Henry Schein, Patterson, Envista 8% Main players Envista,
Slide 10: 1636 new talents
1636 new talents Headcount development 8000 Straumann® BLX implant system Confidence beyond Immediacy 7000 7590 6882 6000 5954 5000 5474 2019 49% 51% 4000 increase 3000 2000 1000 Organic 0 Acquired businesses1 2018 HY 2018 FY 2019 HY 2019 FY 1 Mainly Anthogyr, Digital Planning Service, Yller Biomate
Slide 11: Business and regional review
Business and regional review Peter Hackel, CFO
Slide 12: Double-digit growth across all regions
Double-digit growth across all regions Revenue development (in CHF m, rounded) Regional share of 17.1% organic growth in CHF 17.1% organic 9% Latin 53.1 11.5 1’596.2 America 85.8 23% 82.2 Asia Pacific 1’363.6 -29.5 29.5 1’363.6 34% North Change in organic growth America 13.4% 19.8% 21.5% 16.8% 34% E
Slide 13: BLX boost in EMEA & North America
BLX boost in EMEA & North America EMEA Revenue change (organic) EMEA Q4: slight sequential increase 56% despite exceptional Q4 2019. 19.3% 17.0% Lifted by BLX and value-brand roll- 14.4% 12.7% 13.1% 13.4% 42% of Group 11.9% outs. 9.8% Germany solid; strong increases in Italy, Middle East, Russ
Slide 14: Asia Pacific dynamic; Latin America exceptional
Asia Pacific dynamic; Latin America exceptional APAC Revenue change (organic) APAC Q4: premium implants are the 32.5% 33.1% 56% main driver; strong scanner sales in 25.0% China. 23.4% 24.5% 21.2% 22.1% Value brands add lift (Anthogyr in 19% of Group 16.0% China; Neodent in Japan & Thailand). C
Slide 15: All businesses report continued strong growth
All businesses report continued strong growth Digital & Implant systems Biomaterials Orthodontics restorative 15
Slide 16: Overview of non-core items
Overview of non-core items The following effects were defined as non-core items: − The Batigroup acquisition led to an exceptional inventory-revaluation expense of CHF 8.8m, reported 2018 under ‘costs of goods sold’, as well as a tax benefit of CHF 1.9m − Amortization of acquisition-related intangib
Slide 17: Core financials at a glance
Core financials at a glance % of Margin Change In CHF m, rounded FY 2019 Comments revenue change in % Revenue 1’596.2 100.0% 17.1% COGS (389.0) 24.4%placeholder (16.0%) GROSS PROFIT 1’207.2 75.6% 20bps 17.4% Operating expenses (775.3) 48.6% (17.4%) FX headwind -60bps EBIT 431.9 27.1% 20bps 17.6% IFR
Slide 18: Reported financials at a glance
Reported financials at a glance % of Margin Change In CHF m, rounded FY 2019 Comments revenue change in % Revenue 1’596.2 100.0% 17.1% COGS (395.7) 24.8%placeholder (14.9%) Fire damage at Dental Wings GROSS PROFIT 1’200.5 75.2% 50bps 17.8% Operating expenses (813.3) 51.0% (20.2%) Align patent settle
Slide 19: Core result reconciliation 2019
CORE RESULT RECONCILIATION 2019 CORE RESULT RECONCILIATION 2018 (in CHF 2.000) TFRS PPA Impairments Legal cases Consolidation ‘Other CORE (in CHF 000) TRS PPA Impairments Legal cases Consolidation Other CORE 2019 amortization result former 2019 2018 amortization result former 2018 associates associa
Slide 20: CADCAM & clear-aligner sales lift gross margin
CADCAM & clear-aligner sales lift gross margin In %, rounded +20bps +60bps 0.1 0.0 -0.4 0.5 0.7 -0.4 Dental Wings Fire 75.6 75.2 74.7 75.0 IFRS gross Non core FX effect Core gross Price, Digital HW Inventory Core gross Non core IFRS gross profit items profit Volume, Mix Change profit items profit ma
Slide 21: Further improvement in core EBIT
Further improvement in core EBIT In %, rounded +20bps +80bps 0.5 -0.6 1.8 -0.6 0.6 0.3 -2.8 27.1 26.3 25.1 24.3 IFRS EBIT Non core FX effect Core EBIT Gross profit Distribution Administration IFRS16 Core EBIT Non core IFRS EBIT margin 2018 items margin 2018 improvement expense expenses margin 2019 i
Slide 22: Operational improvements boost core net profit
Operational improvements boost core net profit Align settlement, consolidation gains and In CHF m amortization of acquisition 15.5% related intangibles 64.5 -8.4 0.0 -10.8 -30.2 6.6m due to IFRS 16 15.1 338.2 277.8 292.9 308.0 Net profit Net profit margin margin 21.5% 21.2% IFRS net Non core Core ne
Slide 23: Further improvement of the free cash flow margin
Further improvement of the free cash flow margin In CHF m +35.6% 23.0 -41.2 62.6 6.8 -2.5 229.6 11.5 169.4 Production expansion in various Group sites; CHF 15 m related to Anthogyr acquisition FCF margin FCF margin 12.4% 14.4% Free cash EBITDA IFRS 16 effect Change in CAPEX Change in NWC Change non-
Slide 24: CHF 120m invested in production expansion
CHF 120m invested in production expansion 24 * Expected production capacity increase
Slide 25: Dividend raised
Dividend raised The Board proposes a dividend increase to CHF 5.75 per share (prior year: CHF 5.25) Dividend is payable on 15 April 2020 (ex-dividend date: 9 April 2020) 5.75 5.25 4.75 4.25 4.00 3.75 3.75 3.75 3.75 3.75 3.75 3.75 3.75 3.00 2.50 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2
Slide 26: Recent achievements & strategy in action
Recent achievements & strategy in action Guillaume Daniellot, CEO
Slide 27: Strong performance confirms our strategy
Strong performance confirms our strategy Drive high performance Straumann Group culture and organization Target unexploited growth markets & segments Become the total solution provider for esthetic dentistry 27
Slide 28: Execution – focus on four areas
Execution – focus on four areas Market Share Key opportunities PREMIUM 1 in 4 implants fully tapered; CHF 2.2bn 44% 6% share in fully-tapered premium Gain share outside Brazil; VALUE CHF 2.4bn 10% all price points covered; fully competitive Market growing 20+%; many entrants; ORTHO CHF 3.2bn 2% expa
Slide 29: BLX well received: >100 000 sold in 2019
PREMIUM BLX well received: >100 000 sold in 2019 EMEA Most markets: Q1/2 2019 Russia: 2021 Turkey: 2020 Straumann® BLX implant system NAM Confidence beyond Immediacy USA/Canada: Q3 2019 LATAM Brazil: Q1/Q2 2019 Mexico: 2020* Colombia: 2020* APAC Aus./NZ: Q1 2019 China: 2021* Japa
Slide 30: Simplicity, versatility and affordability – one tapered design
VALUE VALUE Simplicity, versatility and affordability – one tapered design matching all customer preferences TM InternalFIT™ ExternalFIT™ ConicalFIT™ Simplicity made accessible. First launch: LATAM Q1
Slide 31: Dedicated business unit reflects high potential of orthodontics
ORTHO Dedicated business unit reflects high potential and strategic importance of orthodontics Incorporates our ClearCorrect, Smyletec and Geniova clear-aligner brands as well as the recently Orthodontics acquired Bay Materials thermoplastics Business Unit business. 800 employees worldwide Cam
Slide 32: Clear-aligner business growing rapidly
ORTHO Clear-aligner business growing rapidly Market estimated at CHF 3.2bn and growing +64% >20% p.a. case starts y.o.y. 2019: customer base expands >20%; case growth >60% Capacity fully absorbed by strong growth in NAM; full releases in Europe, LATAM & APAC now starting Acquisitions of Digi
Slide 33: Building a powerful team for a broader digital ecosystem
DIGITAL Building a powerful team for a broader digital ecosystem New dedicated Digital Business Unit includes intraoral and laboratory scanners, centralized CADCAM Digital prosthetics, milling equipment, 3D Business Unit printers and materials, prosthetic design, guided surgery software, and plann
Slide 34: 'Smile in a Box' – guided surgery & prosthetic design
DIGITAL ‘Smile in a Box’ – guided surgery & prosthetic design made simple, efficient and convenient Enables clinicians to offer implant treatment using 1 a fully guided digital workflow but without Implant treatment investing in equipment and special digital training planning Covers all surgical
Slide 35: Strong leadership team with broad skills and diverse backgrounds
Strong leadership team with broad skills and diverse backgrounds Guillaume Daniellot Wolfgang Becker Jens Dexheimer Patrick Loh Petra Rumpf Matthias Schupp Robert Woolley CEO Sales Distributor & Sales Europe Sales Asia/Pacific Dental Services Sales Latin America Sales Emerging Markets EMEA Organizat
Slide 36: Set for the future – first-class production organization
Set for the future – first-class production organization and strong Research, Development & Operations team Gerhard Bauer retires after a distinguished career at Straumann Mark Johnson joins Executive Management team as Head RD&O Highly experienced executive engineer with a strong track record
Slide 37: Outlook 2020
Outlook 2020
Slide 38: Coronavirus – dealing with the unforeseeable
Coronavirus – dealing with the unforeseeable Public hospitals and dental clinics in China treating emergency / life-threatening conditions only Private dental practices closed Travel restricted in most cities Straumann Group has 350 employees in China; 10 in Wuhan City; none infected. Staf
Slide 39: Our 2020 guidance
Our 2020 guidance (Barring unforeseen circumstances) Global implant market to continue Market growth growing at 4-5% Confident of gaining market share and achieving Our growth organic revenue growth in the low double-digit percentage range Stable core EBIT margin excluding the impact of Profitabilit
Slide 40: Questions & answers
Questions & answers straumanngroup
Slide 41: Published today
\ ~~ 2019 . Annual Report Published — today
Slide 42: Calendar of upcoming events
Calendar of upcoming events 2020 Event Location 19 February Investor meetings London 20 February Investor meetings Paris 21 February Investor meeting Geneva 03 March Morgan Stanley Medtech conference London 10 March Investor meetings Montreal 11 March Investor meetings New York 12 March Investor mee
Slide 43: Impact from IFRS 16 (Leases) adoption in 2019
Impact from IFRS 16 (Leases) adoption in 2019 IFRS 16 impact (in CHF million)1 Total Revenue Gross profit +0.5 EBITDA +28.2 EBIT +4.1 Financial results -6.6 Net profit -2.5 43
Slide 44: Growth strategy pays off
Growth strategy pays off 2017 2018 2019 2015 2016 5-year average in CHF m restated Core Core Revenue 798.6 917.5 1112.1 Revenue 1363.6 1596.2 Organic revenue growth in % 9.1 13.1 15.7 Organic revenue growth in % 18.9 17.1 14.8 Acquisiton effect in % 9.5 0.8 4.1 Acquisiton effect in % 4.2 2.5 4.2 Cha
Slide 45: Straumann's currency exposure
Straumann’s currency exposure Revenue breakdown FY20191 FX sensitivity CHF Average exchange rates (rounded) (+/- 10%) on full-year 6% Other Closing 18% 2018 2019 2019 Revenue EBIT BRL EUR 1 EURCHF 1.15 1.11 1.09 +/- 43m +/- 23m 7% 27% 1 USDCHF 0.98 0.99 0.97 +/- 45m +/- 21m CNY 100 BRLCHF 26.9 25.1
Slide 46: Thank You
Thank You investor.relations@straumann.com