Slide 1: 2Q19 Earnings Conference
2Q19 Earnings Conference August 21, 2019 1
Slide 2: Legal Disclaimers
Legal Disclaimers Forward-Looking Statements This document contains “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward- looking statements can be identified by words such as: “anticipate,” “inte
Slide 3: Agenda
Agenda Highlights 2Q19 financial results 2019 guidance 3
Slide 4: Highlights
Highlights
Slide 5: Top 3 Priorities
ie iorl San o. ae] 2 2 o o& —- N
Slide 6: Stand up New Alcon
1. Stand up New Alcon Establishing new corporate functions Implementing SAP Separating IT systems Ensuring supply 6
Slide 7: 2. Drive revenues with key growth platforms
2. Drive revenues with key growth platforms 7
Slide 8: 3. Transform culture
3. Transform culture Ownership Accountability Speed Simplicity Customer centricity 8
Slide 9: Launching new SiHy contact lens in the fast growing daily disposable market
Launching new SiHy contact lens in the fast growing daily disposable market LONGER LASTING PERFORMANCE UNWAVERING COMFORT CONVENIENCE 5X more wearers prefer PRECISION1 than the leading brand 9
Slide 10: Strengthening our contact lens portfolio to address unique patient needs
Strengthening our contact lens portfolio to address unique patient needs LASTING ULTIMATE SMART VALUE PERFORMANCE COMFORT DAILY AQUA DAILIES COMFORT PLUS PRECISION1 TOTAL1 (DACP) 10
Slide 11: Driving IOL innovation with PANOPTIX
Driving IOL innovation with PANOPTIX Likely to be the first tri-focal in the United States Pending FDA approval Spectacle independence for 80%-85% of patients Compared to monofocals (7%-12%) Sources: Zvornicanin and Zvornicanin, Journal of Current Ophthalmology (2018) 11
Slide 12: Second quarter and first half 2019 results
Second quarter and first half 2019 results 12
Slide 13: Second Quarter 2019 Results
Second Quarter 2019 Results 2Q19 includes separation costs, Swiss tax reform impact, interest expense +2%, +5%cc (1) 2Q19 includes -90 bps from foreign currency 2Q19 includes $0.06 of interest expense from debt related to the spin-off (1) Constant currency sales growth (cc), core operating margin, a
Slide 14: First Half 2019 Results
First Half 2019 Results 1H19 includes separation costs, spin-readiness, Swiss tax reform impact, interest expense +1% +5%cc (1) 1H19 includes -100 bps from foreign currency 1H19 includes $0.06 of interest expense, primarily from debt related to spin-off 14 (1) Constant currency sales growth (cc), co
Slide 15: Mix of Vision Care and Surgical Products
Diversified portfolio across businesses and geographies Mix of Vision Care and Surgical Products Vision Care $0.8B (45%) Surgical $1.1B (55%) Implantables (30%) Ocular Health (40%) • Monofocal Intra-ocular lenses • Dry eye products • Advanced technology IOLs • Contact lens solution Implantables Ocul
Slide 16: 2Q19 net sales at a glance
2Q19 net sales at a glance • 2% growth; 5% constant- currency growth(1) • Mid-single digit growth across all product categories in constant currency(1) • New innovation driving growth (1) Constant currency growth (cc) is a non-IFRS measure. An explanation of non-IFRS measures can be found in the App
Slide 17: Surgical growth continues
Surgical growth continues Net Sales (USD $M) (USD) (CC)(1) $1,030 $1,051 +5% +2% + • Double digit growth in AT-IOLs • Solid international demand from CLAREON +1% +4% + • Consumable pull-through from equipment • Innovation in smaller gauge instruments +2% +5% + • Demand for cataract equipment • Conti
Slide 18: Vision Care shows steady growth
Vision Care shows steady growth Net Sales (USD $M) (USD) (CC)(1) • Double digit global growth for DAILIES TOTAL1 + • Launched toric in AIROPTIX HYDRAGLYDE $789 $812 3% 6% • Expanded parameters for DAILY AQUA COMFORT PLUS 3% 6% + • Strong momentum for SYSTANE sySys 3% 5% - • Decline in other eye drop
Slide 19: Core operating margin bridge 2Q19 vs 2Q18
Core operating margin(1) bridge 2Q19 vs 2Q18 (% of sales) 17.5 16.6 1 1 1 1 (1) Core operating margin and constant currencies are non-IFRS measures. Refer to the Appendix for definitions of IFRS measures and reconciliations to the most directly comparable measures 19 presented in accordance with IFR
Slide 20: Core operating margin bridge 1H19 vs 1H18
Core operating margin(1) bridge 1H19 vs 1H18 (% of sales) 18.1 17.1 1 1 1 1 (1) Core operating margin and constant currencies are non-IFRS measures. Refer to the Appendix for definitions of IFRS measures and reconciliations to the most directly comparable measures 20 presented in accordance with IFR
Slide 21: Managing capital allocation
Managing capital allocation Debt $3.5 billion Refinancing to extend average maturity Cash and cash equivalents $721 million YTD cash flows from operations $301 million YTD free cash flow1 $95 million Capex $206 million Investing in new VC manufacturing lines 1 Free cash flow is a non-IFRS measure. R
Slide 22: 2019 Guidance
2019 Guidance
Slide 23: On track towards full-year 2019 guidance
On track towards full-year 2019 guidance 1H19 FY19 Outlook Sales growth (1) 5.0% 3% – 5% Core operating margin (2) 17.1% 17% - 18% Core effective tax rate (3) 15.2% 17% - 19% (1) Constant currency sales growth (cc) is a non-IFRS measure. Growth in constant currency (cc) is calculated by translating
Slide 24: Standing up New Alcon, Innovating, Helping patients see brilliantly
Standing up New Alcon Innovating new product pipeline Helping patients see brilliantly 24
Slide 25: Appendix
Appendix
Slide 26: Appendix: Non-IFRS measures as defined by the Company
Appendix: Non-IFRS measures as defined by the Company Alcon uses certain non-IFRS metrics when measuring performance, including when measuring current period results against prior periods, including core results, percentage changes measured in constant currencies, and free cash flow. Because of thei
Slide 27: Reconciliation of IFRS to Core Results
Reconciliation of IFRS to Core Results Three months ended June 30, 2019 Amortization of certain ($ millions except (loss)/earnings per share) IFRS Results intangible assets(1) Separation costs(2) Other items(3) Core Results Gross profit 947 252 3 2 1,204 Selling, general & administration (760) 13 2
Slide 28: Reconciliation of IFRS to Core Results
Reconciliation of IFRS to Core Results Three months ended June 30, 2018 Amortization of certain Restructuring ($ millions except earnings per share) IFRS Results intangible assets(1) Impairments(2) items(3) Legal items(4) Other items(5) Core Results Gross profit 878 251 39 1,168 Selling, general & a
Slide 29: Reconciliation of IFRS to Core Results
Reconciliation of IFRS to Core Results Six months ended June 30, 2019 Amortization of certain ($ millions except (loss)/earnings per share) IFRS Results intangible assets(1) Separation costs(2) Legal items(3) Other items(4) Core Results Gross profit 1,799 502 3 10 2,314 Selling, general & administra
Slide 30: Reconciliation of IFRS to Core Results
Reconciliation of IFRS to Core Results Six months ended June 30, 2018 Amortization of certain Restructuring ($ millions except earnings per share) IFRS Results intangible assets(1) Impairments(2) items(3) Legal items(4) Other items(5) Core Results Gross profit 1,745 502 39 2,286 Selling, general & a
Slide 31: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow The following is a summary of Alcon free cash flow for the six months ended June 30, 2019, together with a reconciliation to net cash flows from operating activities, the most directly comparable IFRS measure: ($ millions) Net cash flows from operating activities 301
Slide 32: Alcon
Alcon SEE BRILLIANTLY