Emergent Biosolutions Inc. · NYSE:EBS
Emergent Biosolutions — Q3 2024 Earnings Presentation
42 slides from Emergent Biosolutions's earnings presentation, Nov 6, 2024
Slide 1: Q3 2024 Financial Results Update
Q3 2024 Financial Results Update November 6, 2024 Proprietary & Confidential
Slide 2: Introduction
Introduction Q3 2024 Update PROPRIETARY AND CONFIDENTIAL
Slide 3: Safe Harbor Statement/Trademarks
INTRODUCTION Safe Harbor Statement/Trademarks This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including statements regarding the future performance of the Compa
Slide 4: Agenda
INTRODUCTION Agenda Presenter Topic(s) Joseph C. Papa • Multi-Year Progress Update President and CEO Rich Lindahl • Q3 2024 Financial Review EVP, CFO and Treasurer • FY 2024 Guidance Joseph C. Papa • Key Product Highlights President and CEO • Future Growth Drivers • Entering Turnaround Phase • Closi
Slide 5: Multi-Year Progress Update
Multi-Year Progress Update Q3 2024 Update Joseph C. Papa President and Chief Executive Officer PROPRIETARY AND CONFIDENTIAL 55
Slide 6: Key Financial Stabilization Priorities
Multi-Year Progress Update Transformation Update1 • Achieved critical stabilization milestones in Q1-Q3: entering our turnaround phase • Raising 2024 revenue and adjusted EBITDA2 guidance Successfully Achieved Objectives YTD Results; Activities Completed in Q3 Reduced net debt versus 2023 year end •
Slide 7: Financials
Financials Q3 2024 Update Rich Lindahl Executive Vice President, Chief Financial Officer and Treasurer PROPRIETARY AND CONFIDENTIAL 7
Slide 8: Stronger Financial Position Driven By Q3 Achievements
FINANCIALS Stronger Financial Position Driven By Q3 Achievements1 Key Accomplishments Positive Outcomes Material Debt Reduction ($ Millions) (2) Streamlined Business & Completed $117M of Asset ($167)/(19%) Sales ($206)/(27%) • $75M for the sale of RSDL® to SERB • $35M for the sale of Baltimore-Camde
Slide 9: Key Business Highlights | MCM Awards & Increased Full Year Guidance
FINANCIALS Key Business Highlights | MCM Awards & Increased Full Year Guidance1 Received ~$500 million in MCM contract modification awards: Year-to-Date Revenue Diversification • $20M Biothrax® ($236M through 2033) Commercial MCM Services C&G • $30M CYFENDUS® • $100M ACAM2000® • $185M of incremental
Slide 10: Key Financial Performance Metrics Q3 2024 vs. Q3 2023
FINANCIALS Key Financial Performance Metrics Q3 2024 vs. Q3 20231 ($ in millions) Q3 Q3 2023 2024 + 9% YoY + $68M & + 2,100 bps YoY + $85M YoY 59% 38% Q3 Q3 Q3 Q3 Q3 Q3 2023 2024 2023 2024 2024 2023 Total Revenues Total Segment Adjusted Gross Margin2 Adjusted EBITDA2 --- Total Segment Adjusted Gross
Slide 11: Notable Revenue Elements Q3 2024 vs. Q3 2023
FINANCIALS Notable Revenue Elements Q3 2024 vs. Q3 20231 ($ in millions) Q3 2023 Q3 2024 % Change Product sales, net (2): NARCAN® $ 142.1 $ 95.3 (33)% Anthrax MCM 32.9 11.4 (65)% Smallpox MCM 24.7 132.7 437 % Other Products 50.1 30.1 (40)% Total Product sales, net $ 249.8 $ 269.5 8% Bioservices: Ser
Slide 12: Key Financial Performance Metrics Q3 2024 vs. Q3 2023
FINANCIALS Key Financial Performance Metrics Q3 2024 vs. Q3 2023 1 ($ in millions) Q3 Q3 2023 2024 59% 38% 26% 32% Q3 Q3 Q3 Q3 Q3 Q3 2023 2024 2023 2024 2023 2024 Total Segment Adjusted R&D $ SG&A $ Gross Margin $2 --- --- SG&A Margin %3 Total Segment Adjusted Gross Margin %2 1. All financial inform
Slide 13: Key Financial Performance Metrics YTD 2024 vs. YTD 2023
FINANCIALS Key Financial Performance Metrics YTD 2024 vs. YTD 20231 ($ in millions) YTD YTD 2023 2024 + 10% YoY + $131M & + 1,300 bps YoY + $188M YoY 33% 46% YTD YTD YTD YTD 2023 2024 2023 2024 YTD YTD Total Revenues 2023 2024 Total Segment Adjusted Gross Margin2 Adjusted EBITDA2 --- Total Segment A
Slide 14: Significantly Improved Financial Metrics in Q3
FINANCIALS Significantly Improved Financial Metrics in Q3 1, 4 $ in Millions Turned Around Operating Cash Flow Much Lower Net Leverage3,4 + $377 2 2 Reduced Net Working Capital4 Stronger Liquidity +$168 ($98) $250 $100 Revolver Availability $82 Cash $12 Revolver Availability Cash 1. All financial in
Slide 15: 2024 Full Year Revenue & Adjusted EBITDA Guidance
FINANCIALS 2024 Full Year Revenue & Adjusted EBITDA Guidance 1,2 Increased Midpoint of 2024 Revenue and Adjusted EBITDA 2 Guidance Range March 6, 2024 May 1, 2024 August 6, 2024 November 6, 2024 $1,125 $1,125 $1,100 $1,100 $1,095 FY Revenue $1,088 Guidance & Midpoint $1,050 $1,050 $1,065 $1,000 $1,0
Slide 16: Continued Focus on Our Transformation Efforts
Continued Focus Focus on Ouron Transformation Transformation Efforts Efforts PROPRIETARY AND CONFIDENTIAL 16
Slide 17: NARCAN Nasal Spray – Making Progress Through Increased Access and Awareness Efforts
KEY PRODUCT HIGHLIGHTS NARCAN® Nasal Spray – Making Progress Through Increased Access and Awareness Efforts Strong Ongoing Bipartisan Support Key Highlights: • Public interest channel volume is up 14% YTD vs. last year CDC reports overdose deaths decreased by 3% between May ’23-’24; Making Progress,
Slide 18: Medical Countermeasures – Critical to Public Health Preparedness & Response
KEY PRODUCT HIGHLIGHTS Medical Countermeasures – Critical to Public Health Preparedness & Response Strong Ongoing Bipartisan Support The world is facing an ever-growing number of public Key Highlights: health threats; WHO declares 2024 mpox surge a ‘public • Received ~$500 million in new MCM contrac
Slide 19: Entering Our Turnaround Phase
Transformation Efforts Entering Our Turnaround Phase • Continue to be a mission-driven leader in public health • Diverse revenue stream • Enable growth and seek new opportunities aligned to our internal capabilities • Elevate our business lines for today's competitive landscape • Create long-term an
Slide 20: Focus on Growth Opportunities for Core Business; New CMO Leader Supports Turnaround Efforts
Transformation Efforts Focus on Growth Opportunities for Core Business; New CMO Leader Supports Turnaround Efforts Product Current Markets Short-Term (by end 2025) Mid - / Long-Term (2026 & later) NARCAN® Nasal Spray - Opioid Overdose US | CAN Line extentions market expansion options ANTHRASIL® - An
Slide 21: Well Positioned for Turnaround
Transformation Efforts Well Positioned for Turnaround Continued stabilization helps Substantial debt reduction position EBS for the future NARCAN® Nasal Spray continues New MCM contract awards and to be in demand as crisis evolves orders from the U.S. Government Strong YTD results build a solid Well
Slide 22: Q&A
Q&A PROPRIETARY AND CONFIDENTIAL 22
Slide 23: End Notes: Non-GAAP Financial Measures
End Notes: Non-GAAP Financial Measures In this presentation, we sometimes use information derived from consolidated and segment financial information that may not be presented in our financial statements or prepared in accordance with generally accepted accounting principles in the United States (“G
Slide 24: End Notes: Non-GAAP Financial Measures (Continued)
End Notes: Non-GAAP Financial Measures (Continued) We have included the definitions of Segment Gross Margin and Segment Gross Margin %, which are GAAP financial measures, below in order to more fully define the components of certain non-GAAP financial measures presented in this presentation. We defi
Slide 25: Appendix
Appendix PROPRIETARY AND CONFIDENTIAL 25 25
Slide 26: 2024 Forecast – Updated as of 11/6/2024
APPENDIX 2024 Forecast – Updated as of 11/6/2024 METRIC Updated Range Previous Range Previous Range Previous Range ($ in millions) (as of 11/6/2024) (as of 08/06/2024) (as of 05/01/2024) (as of 03/06/2024) Total revenues $1,065 - $1,125 $1,050 - $1,125 $1,000 - $1,100 $900 - $1,100 Net loss $(203) -
Slide 27: Product Portfolio | Key Product Details
APPENDIX Product Portfolio | Key Product Details 2024 FY Product FDA Approved Production Contract Terms 2024 Award Current Markets Revenue Forecast ($M) NARCAN® Nasal Spray - Opioid Overdose 3rd party In-Year Procurment US | CAN $420 - $430 ANTHRASIL® - Anthrax Winnipeg In-Year Procurment US | CAN C
Slide 28: Streamlining Toward a Leaner Site Network, While Maintaining Capabilities
APPENDIX Streamlining Toward a Leaner Site Network, While Maintaining Capabilities to Meet/Exceed All Customer and Product Demand 28
Slide 29: Key Financial Performance Metrics Q3 2024 vs. Q3 2023
APPENDIX Key Financial Performance Metrics Q3 2024 vs. Q3 2023 1 ($ in millions) Q3 Q3 2023 2024 32% 26% Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 Cost of Commercial Cost of MCM Product Cost of Bioservices R&D $ SG&A $ Product Sales Sales --- SG&A Margin %2 1. A
Slide 30: Segment Reporting Q3 2024 vs. Q3 2023
APPENDIX Segment Reporting Q3 2024 vs. Q3 20231 ($ in millions) Q3 Q3 2023 2024 COMMERCIAL PRODUCTS SEGMENT MCM PRODUCTS SEGMENT SERVICES SEGMENT 73% 58% 50% 36% 36% (155)% (49)% Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 Revenue Segment Adjusted Revenue Segment
Slide 31: Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) - Q3 2024 vs. Q3 2023
APPENDIX Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) - Q3 2024 vs. Q3 2023 Three Months Ended September 30, (unaudited, $ in millions) 2024 2023 Source Net income (loss) $ 114.8 $ (263.4) Adjustments: Non-cash amortization charges $ 9.7 $ 21.9 Amortization of intangible assets
Slide 32: Reconciliation of Net Loss to Adjusted Net Loss – YTD 2024 vs. YTD 2023
APPENDIX Reconciliation of Net Loss to Adjusted Net Loss – YTD 2024 vs. YTD 2023 Nine Months Ended September 30, (unaudited, $ in millions) 2024 2023 Source Net loss $ (159.3) $ (711.0) Adjustments: Non-cash amortization charges $ 54.0 $ 65.0 Amortization of intangible assets (IA), Other Income Chan
Slide 33: Reconciliation of Net Income (Loss) to Adjusted EBITDA - Q3 2024 vs. Q3 2023
APPENDIX Reconciliation of Net Income (Loss) to Adjusted EBITDA - Q3 2024 vs. Q3 2023 Three Months Ended September 30, (unaudited, $ in millions) 2024 2023 Net income (loss) $ 114.8 $ (263.4) Adjustments: Depreciation & amortization $ 26.4 $ 27.9 Income taxes 27.6 (2.5) Total interest expense, net 7
Slide 34: Reconciliation of Net Loss to Adjusted EBITDA – YTD 2024 vs. YTD 2023
APPENDIX Reconciliation of Net Loss to Adjusted EBITDA – YTD 2024 vs. YTD 2023 Nine Months Ended September 30, (unaudited, $ in millions) 2024 2023 Net loss $ (159.3) $ (711.0) Adjustments: Depreciation & amortization $ 82.8 $ 95.5 Income taxes 44.0 34.3 Total interest expense, net 54.8 59.9 Impairm
Slide 35: Reconciliations of Total Revenues to Total Segment Revenues and Gross Margin - Q3
APPENDIX Reconciliations of Total Revenues to Total Segment Revenues and of Segment and Total Segment Gross Margin and Gross Margin % to Segment and Total Segment Adjusted Gross Margin and Adjusted Gross Margin % - Q3 2024 vs. Q3 2023 Three Months Ended September 30, 2024 Commercial (unaudited, in m
Slide 36: Reconciliations of Total Revenues to Total Segment Revenues and Gross Margin - YTD
APPENDIX Reconciliations of Total Revenues to Total Segment Revenues and of Segment and Total Segment Gross Margin and Gross Margin % to Segment and Total Segment Adjusted Gross Margin and Adjusted Gross Margin % – YTD 2024 vs. YTD 2023 Nine Months Ended September 30, 2024 Commercial Contracts & (un
Slide 37: Reconciliation of Total Debt to Net Debt and Leverage Ratio to Net Leverage Ratio
APPENDIX Reconciliation of Total Debt to Net Debt1 and Leverage Ratio to Net Leverage Ratio As of As of As of (unaudited, $ in millions) September 30, 2024 September 30, 2023 December 31, 2023 Total debt $ 700.8 $ 866.3 $ 868.4 Less: Cash and cash equivalents 149.9 87.8 111.7 Net debt $ 550.9 $ 778.
Slide 38: Reconciliation of Working Capital to Net Working Capital
APPENDIX Reconciliation of Working Capital to Net Working Capital As of As of As of (unaudited, $ in millions) September 30, 2024 June 30, 2024 September 30, 2023 Working Capital $ 431.5 $ 34.8 $ 56.8 Less: Cash and cash equivalents 149.9 69.7 87.8 Add: Debt, current portion1 0.8 415.2 413.6 Net wor
Slide 39: Reconciliation of Net Loss to Adjusted Net Loss – FY 2024 Forecast
APPENDIX Reconciliation of Net Loss to Adjusted Net Loss – FY 2024 Forecast ($ in millions) 2024 Full Year Forecast Source Net loss $(203) - $(183) Adjustments: Amortization of intangible assets and Other Income Non-cash amortization charges $65 (Expense) Changes in fair value of financial instrumen
Slide 40: Reconciliation of Net Loss to Adjusted EBITDA – FY 2024 Forecast
APPENDIX Reconciliation of Net Loss to Adjusted EBITDA – FY 2024 Forecast ($ in millions) 2024 Full Year Forecast Net loss $(203) - $(183) Adjustments: Depreciation & amortization $109 Income taxes 60 Total interest expense, net 75 Impairments 27 Inventory step-up provision 1 Changes in fair value o
Slide 41: Reconciliations of Forecasted Total Revenues to Forecasted Segment Revenues - FY 2024
APPENDIX Reconciliations of Forecasted Total Revenues to Forecasted Total Segment Revenues and of Forecasted Segment and Total Segment Gross Margin and Gross Margin % to Forecasted Segment and Total Segment Adjusted Gross Margin and Adjusted Gross Margin % - FY 2024 Forecast (in millions) 2024 Full
Slide 42: www.emergentbiosolutions.com
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