Slide 1: Q1 2023 Earnings Presentation
Q1 2023 Earnings Presentation May 10, 2023 1
Slide 2: Safe harbor
Safe harbor Forward-looking statements This document contains, and our officers and representatives may from time to time make, certain “forward-looking statements” within the meaning of the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. Forward- looking statement
Slide 3: Agenda
Agenda 01 Key topics 02 IFRS results 03 Core results 04 Outlook 3
Slide 4: Agenda: Key topics
Agenda 01 Key topics 02 IFRS results 03 Core results 04 Outlook 4
Slide 5: Q1 2023 Highlights
Q1 2023 Highlights 1 • Sales of $2.3B, up 7%, or 11% cc ; growth driven by continued strength in demand, solid commercial execution, acquired products and price increases • Operating margin of 11.5%; core operating 1 margin of 20.6% 1 • Diluted EPS of $0.35, up 3%, or up 26% cc ; 1 core diluted EPS
Slide 6: Q1 2023 Select financial highlights
Q1 2023 Select financial highlights rd 1 1 1 3 party sales Core operating margin Core diluted EPS Free cash flow 1Q23 $2,333M 1Q23 20.6% 1Q23 $0.70 1Q23 ($19M) 1Q22 $2,175M 1Q22 20.6% 1Q22 $0.68 1Q22 ($52M) 1 Sales of $2.3B, up 7%, or 11% cc Operating margin of 11.5%, up 1Q23 diluted EPS of $0.35 up
Slide 7: Agenda: IFRS results
Agenda 01 Key topics 02 IFRS results 03 Core results 04 Outlook 7
Slide 8: Q1 2023 IFRS results
Q1 2023 IFRS results Worldwide net sales Operating margin Diluted EPS $2.3B 11.3% 11.5% $2.2B $0.34 $0.35 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 Y/Y change (USD): • +7% • +20 bps • +3% 8
Slide 9: Q1 2023 IFRS operating margin bridge
Q1 2023 IFRS operating margin bridge 1Q23 vs. 1Q22, % of net sales 0.8 0.4 13.0 1.3 (0.8) 11.5 11.3 (1.5) 1Q22 Gross SG&A R&D Other income/ Foreign 1Q23 Margin expense Exchange 9
Slide 10: Agenda: Core results
Agenda 01 Key topics 02 IFRS results 03 Core results 04 Outlook 10
Slide 11: Q1 2023 Core results
1 Q1 2023 Core results Worldwide net sales Core operating margin Core diluted EPS $2.3B 20.6% 20.6% $0.70 $2.2B $0.68 1Q22 1Q23 1Q22 1Q23 1Q22 1Q23 Y/Y change (cc): • +11% • +130 bps • +14% 1. Core operating margin, core diluted EPS, and constant currency growth, including FX impacts, are non-IFRS m
Slide 12: Q1 2023 Product mix
1 Q1 2023 Product mix Vision Care $1.0B (44%) Surgical $1.3B (56%) Ocular health (40%) Implantables (33%) Dry eye products Monofocal IOLs Allergy eye drops Advanced technology IOLs Steroid eye drops Glaucoma implants Glaucoma eye drops $2.3 billion Contact lens care Consumables (50%) Dedicated consu
Slide 13: Q1 2023 Surgical
Q1 2023 Surgical Net Sales 1 (USD) (CC) Surgical growth driven by strong consumables and (USD $M) equipment sales, partially offset by $1,259 $1,304 4% 8% PCIOLs in South Korea • Increase in IOL sales across geographies (excl. South Korea); $427 (6%) (3%) $455 + Implantables growth +5% USD y/y excl.
Slide 14: Q1 2023 Vision Care
Q1 2023 Vision Care Net Sales Double-digit Vision Care growth reflects strength in (USD $M) (USD) (CC)1 contact lenses and eye drops, including $916 $1,029 12% 16% acquired products • Solid global contact lens market growth 10% 14% + • ALC above-market growth, particularly in US, with silicone hydro
Slide 15: Q1 2023 Core operating margin bridge
1 Q1 2023 Core operating margin bridge 1Q23 vs. 1Q22, % of net sales 0.6 1.6 — 21.9 20.6 (0.9) 20.6 (1.3) 1Q22 Gross Margin SG&A R&D Other income/ Foreign 1Q23 expense Exchange Key drivers • Improved underlying operating leverage from higher sales and manufacturing efficiencies, offset by unfavorabl
Slide 16: Q1 2023 Cash flow and balance sheet highlights
Q1 2023 Cash flow and balance sheet highlights Cash and cash equivalents $889 million 1Q23 cash flows from operations $85 million 1 1Q23 free cash flow ($19) million Capex $104 million Investments in new contact lens manufacturing capacity Debt $4.7 billion No financial covenants 16 1. Free cash flo
Slide 17: Agenda: Outlook
Agenda 01 Key topics 02 IFRS results 03 Core results 04 Outlook 17
Slide 18: FY 2023 Outlook
FY 2023 Outlook 2023 outlook as of February as of May Comments vs. February Net sales (USD) $9.2 to $9.4 billion $9.2 to $9.4 billion Maintain 1 Change vs. prior year (cc) +6% to +8% +7% to +9% Increase 1 Core operating margin 19.5% to 20.5% 19.5% to 20.5% Maintain 2 Interest expense and OFI&E $260
Slide 19: Appendix
Appendix 19
Slide 20: Appendix: Non-IFRS measures as defined by the Company
Appendix: Non-IFRS measures as defined by the Company Alcon uses certain non-IFRS metrics when measuring performance, including when measuring current period results against prior periods, including core results, percentage changes measured in constant currencies and free cash flow. Because of their
Slide 21: Reconciliation of IFRS results to core results (Q1 2023)
Reconciliation of IFRS results to core results Three months ended March 31, 2023 Amortization of IFRS certain intangible Transformation Other Core (1) (2) (4) ($ millions except earnings per share) results assets costs items results Gross profit 1,305 169 — 4 1,478 Operating income 268 173 26 13 480
Slide 22: Reconciliation of IFRS results to core results (Q1 2022)
Reconciliation of IFRS results to core results Three months ended March 31, 2022 Amortization of certain IFRS intangible Transformation Legal Other Core (1) (2) (3) (4) ($ millions except earnings per share) results assets costs Items items results Gross profit 1,208 140 — — 9 1,357 Operating income
Slide 23: Explanatory footnotes to IFRS to core reconciliation tables
Reconciliation of IFRS results to core results Explanatory footnotes to IFRS to core reconciliation tables (1) Includes recurring amortization for all intangible assets other than software. (2) Transformation costs, primarily related to restructuring and third party consulting fees, for the multi-ye
Slide 24: Reconciliation of free cash flow
Reconciliation of free cash flow The following is a summary of free cash flow for the three months ended March 31, 2023 and 2022, together with a reconciliation to net cash flows from operating activities, the most directly comparable IFRS measure: ($ millions) 2023 2022 Net cash flows from operatin
Slide 25: Alcon
Alcon SEE BRILLIANTLY