Recordati S.p.a. · MIL:REC
Recordati — Investor Presentation (October 2003)
25 slides from Recordati's investor presentation, October 2003
Slide 1: A focused strategy
A focused strategy October 2003
Slide 2: Key Consolidated Data
Key Consolidated Data (million euro) 492.7 500 90 EBIT SALES 433.4 CAGR 50% 80 CAGR 23% 400 355.9 70 NET INCOME 60 CAGR 44% 271.8 300 50 214.9 40 200 EBIT 30 Net Income 20 100 10 0 0 1998 1999 2000 2001 2002 1998 1999 2000 2001 2002 Gross margin 60% 30% EBITDA, EBIT, Net Profit 84.1% 55% 25% Pharmac
Slide 3: Pharmaceutical Net Sales
Pharmaceutical Net Sales (million euro) 84.1% 414.4 CAGR 400 Pharma as % of total 31% 349.6 55% 300 269.3 Int’l as % of pharma 65.3% 250 188.5 200 200 140.4 20% 100 150 100 0 1998 1999 2000 2001 2002 50 0 1998 1999 2000 2001 2002 Italy International 2
Slide 4: EBITDA
EBITDA € 15.2 m € 16.4 m € 12.6 m € 107.2 m 1998 18.9% 11.6% Pharmaceuticals 2002 25.9% Pharmaceutical chemicals 14.0% As % of sales 3
Slide 5: Operational highlights First nine months 2003
Operational highlights First nine months 2003 • Pharmaceutical sales up 4.6%, excluding non- recurring 2002 revenue from U.S. lercanidipine • Significant growth of lercanidipine sales • Italian pharmaceutical sales increase by 9.7% • Third quarter EBIT and net income margins improve over first two q
Slide 6: First nine months results
First nine months results (million euro) 2002 2003 Change % Net Sales 364.8 356.6 (2.2)% Gross Profit 215.9 209.2 (3.1)% as % of sales 59.2% 58.6% Selling Expenses 102.7 109.0 6.0% as % of sales 28.2% 30.5% R&D Expenses 25.9 24.9 as % of sales 7.1% 7.0% (4.0)% EBITDA 87.9 76.8 as % of sales 24.1% (1
Slide 7: First nine months composition of sales
First nine months composition of sales (million euro) 2002 2003 Change % PHARMACEUTICALS 306.9 308.0 0.4% 84.1% 86.4% PHARMACEUTICALS (excluding U.S. 294.4 308.0 4.6% revenue from lercanidipine in 2002) PHARMACEUTICAL 57.9 48.6 CHEMICALS 15.9% 13.6% (16.1)% 364.8 356.6 TOTAL 100.0% (2.2)% 100.0% ITA
Slide 8: Sources of growth
Sources of growth (% change, first nine months 2003 Volume Price Exchange Total over first nine months 2002) PHARMACEUTICALS 5.5 % (4.4) % (0.7) % 0.4 % PHARMACEUTICALS (excluding U.S. 9.9 % (4.6) % (0.7) % 4.6% revenue from lercanidipine in 2002) PHARMACEUTICAL (3.6) % (16.1) % CHEMICALS (4.3) % (8
Slide 9: Breakdown of first nine months 2003 pharmaceutical sales
Breakdown of first nine months 2003 pharmaceutical sales International licensees Spain 18.2% 5.1% Sophartex France 6.2% 21.2% Italy 49.3% 8
Slide 10: First nine months EBITDA by business area
First nine months EBITDA by business area (million euro) 2002 2003 Change % PHARMACEUTICALS 76.9 72.2 (6.1)% as % of sales 25.1% 23.4% PHARMACEUTICALS (excluding U.S. 66.9 72.2 8.0% revenue from lercanidipine in 2002) 22.7% 23.4% PHARMACEUTICAL CHEMICALS 11.0 4.6 (58.2)% as % of sales* 16.4% 8.1% TO
Slide 11: Capital employed
Capital employed (million euro) 31 December 2002 30 September 2003 44.7 33.6 79.8 Net working capital for operations 80.7 Net non-current assets 227.1 Net debt 234.3 192.0 187.2 Shareholders’ equity Capital employed: 271.8 Capital employed: 267.9 10
Slide 12: First nine months cash flow
First nine months cash flow (million euro) 2002 2003 Net Income 35.8 30.0 Depreciation of Fixed Assets 11.1 12.4 Amortization of Intangible Assets 13.6 8.3 Cash Flow from Operations 60.5 50.7 Change in Working Capital 7.6 (0.9) Net Investment in Fixed Assets (15.0) (11.7) Net Investment in Intangibl
Slide 13: Main products
Main products Breakdown of 12 months pharmaceutical sales at September 2003 Zanidip (lercanidipine) 21% 10% Elopram (citalopram) 8% Peptazol/Ulcotenal (pantoprazole) 5% Tora-Dol (ketorolac) Other Products 4% Hexa line (biclotimol) Main 22% 4% Isocef (ceftibuten) Products 3% Exomuc (acetylcysteine) O
Slide 14: ZANIDIP (Lercanidipine)
ZANIDIP® (Lercanidipine) • Next generation calcium-channel blocker and first lipophilic DHP CCB to be filed with the FDA. • Natural once a day. Potent, long-lasting vasodilatory activity. Highly vasoselective with gradual onset, smooth and uniform blood pressure lowering activity. • Efficacy as best
Slide 15: Lercanidipine – Roll out status and plan
Lercanidipine – Roll out status and plan 55 launches 15 additional approvals USA ROW modified release formulation 27 filings in development EUROPE 1998 Italy, Spain, UK 2000 Germany 2001 France (Pie slices represent relative JAPAN market value of calcium channel local phase III studies blockers) lau
Slide 16: Lercanidipine as a % of all calcium channel blockers
Lercanidipine as a % of all calcium channel blockers Bubble size represents $ market value of CCB’s 12 Italy % share of CCB market France 10 Germany S.Korea 8 Austria Australia 6 Spain Belgium 4 U.K. 2 Holland 0 0 2 4 6 8 10 12 14 16 18 20 22 24 Quarters from launch Source: IMS data - 2Q 2003 15
Slide 17: First nine months lercanidipine sales
First nine months lercanidipine sales (million euro) 2002 2003 Change % DIRECT SALES 33.3 38.0 14.0% 51.6% 57.0% SALES TO LICENSEES 22.2 EXCLUDING THOSE TO FOREST 28.6 29.2% 34.3% 43.0% LABS SALES TO FOREST 9.1 - n.a. LABS 14.1% TOTAL LERCANIDIPINE 64.6 66.6 3.1% 150.0 100.0% 100.0% SALES 59.1% 16
Slide 18: Product pipeline
Product pipeline LERCANIDIPINE / ACE-I COMBINATION LERCANIDIPINE 20 mg REC 0545 (hypertension) (overactive bladder/ LERCANIDIPINE urinary incontinence) (hypertension) 2 NEW EU and APPROACHES Australia Germany (overactive France bladder) REC 2615 (female sexual Japan and dysfunction) 27 countries 15
Slide 19: Filling the pipeline: Ongoing R&D
Filling the pipeline: Ongoing R&D • Lercanidipine: • Further recognition of superior clinical profile • Patent life in extension, two new patents published • 20mg strength approved in Europe and in Australia, launched in Germany and France • Modified release formulation under development with Forest
Slide 20: Filling the pipeline: Ongoing R&D
Filling the pipeline: Ongoing R&D • Lercanidipine-ACEI fixed combination: • New aggressive targets for blood pressure control • Combination of drugs needed for most patients • Patient compliance • Fixed combinations will play a significant role in the future hypertension market • Phase III nearing c
Slide 21: Filling the pipeline: Ongoing R&D
Filling the pipeline: Ongoing R&D • Urology: • REC 0545, a 5HT1A receptor antagonist for the treatment of unstable bladder. Proof of concept clinical program in preparation • REC 15/2615, in development for the treatment of female sexual dysfunction, approaching clinical phases • Two new discovery a
Slide 22: Outlook for 2003
Outlook for 2003 • Favorable outlook for pharmaceuticals: sales growth in Europe in spite of price reductions, other cost containment measures • Lercanidipine market share increase in markets where launched • Pharmachem business to be disposed of within the first quarter 2004 21
Slide 23: Outlook for 2003
Outlook for 2003 2003 (million euro) 2002 target Net Sales 492.7 ~ 500 EBIT 89.2 ~ 80 Pharmachem performance below that of last year Pharmaceuticals grow on a comparable basis 22
Slide 24: Outlook to 2005
Outlook to 2005 • Focus will be on the pharmaceutical business • Target is to broaden direct pharmaceutical presence in Europe • EBIT 2003 through 2005 CAGR of 10% 23
Slide 25: Forward-looking statements
Statements contained in this presentation, other than historical facts, are “forward- “forward- looking statements” (as such term is defined in the Private Securities Litigation Reform Act of 1995). 1995) . These statements are based on currently available information, on current best estimates, and