Laboratorio Reig Jofre, S.a. · BME:RJF
Laboratorio Reig Jofre — Merger or Acquisition (October 2014)
48 slides from Laboratorio Reig Jofre's merger presentation, Oct 15, 2014
Slide 1: Relevant Fact
Mr. Iñigo de la Lastra Head of Secondary Markets CNMV Edison, 4 28006 Madrid RELEVANT FACT Valencia (Spain), October 15, 2014 Dear Sir, In accordance with Article 82 of Law 24/1988, 28th July, relative to the regulation of the stock market and related provisions, and in relation to the merger projec
Slide 2: Natraceutical and Laboratorio Reig Jofre join the consolidation of European pharma
Natraceutical and Laboratorio Reig Jofre join the consolidation process of the European pharmaceutical industry The new company resulting from the merger will strengthen its position in the pharmaceutical market by means of the synergies in research and development of new products, regulatory know
Slide 3: The merger will strengthen the new company's market position
The merger of these two companies will enable the new company to strengthen its market position by diversifying its product portfolio in the pharma segment (69% of net joint business 2013), OTC (16%) and food supplements (15%) as well as its international presence, with sales outside Spain, accordin
Slide 4: About Laboratorio Reig Jofre
About Laboratorio Reig Jofre Founded in 1929 in Barcelona, Laboratorio Reig Jofre is one of the leading companies in the European pharmaceutical sector. Family owned, the company has a workforce of over 700 employees and an international positioning that has allowed strong growth in recent years. Wi
Slide 5: Natraceutical: Merger project with Laboratorio Reig Jofre
natraceutical Merger project with Laboratorio Reig Jofre, SA
Slide 6: Disclaimer
This presentation contains no confidential material and may include publicly available market information which has not been independently verified by Natraceutical. This information is given in summary form and does not purport to be complete. Information in this presentation should not be consider
Slide 7: Contents
CONTENTS Ol. O2. 03. 04. O5. O06. O7. 08. 09. 10. BACKGROUND NATRACEUTICAL TODAY TWO SYNERGISTIC INDUSTRIES LABORATORIO REIG JOFRE TODAY INDUSTRIAL SENSE OF THE MERGER NTC AFTER THE INTEGRATION OF LR) FORECAST OF 2014 RESULTS STRUCTURE OF THE MERGER AND NEW SHAREHOLDER COMPOSITION CORPORATE GOVERNAN
Slide 8: 01. Background
Slide 9: Merger background and protocol
• On May 8, 2014, Natraceutical SA (hereinafter NTC) and Laboratorio Reig Jofre, SA (hereinafter LRJ) signed a Letter of Intent (LOI) in order to initiate a negotiation process aimed at studying the possible integration of the two companies. • After completion of the due diligence of both companies,
Slide 10: 02. Natraceutical Today
ee Gee 25 Oo es 202. NATRACEUTICAL TODAY Oo
Slide 11: Creation and consolidation of natural and functional businesses
2006-2012 20013-2014 2002-2006 Creation of the Food Focus on the food supplements business Creation and Supplements Division by with development of first OTC products. consolidation of the natural and functional acquisition of Laboratorios Forte Ingredients Division Pharma and integration of the Ing
Slide 12: Important diversification into health and energy segments
NATRACEUTICAL TODAY Important diversification into health and energy segments -_ Since . ay 2 2008 | ig J} Weight | WN d = control » Energy a Beauty 670% 12,8% 12,5% 00% »UY #0 ,O /0 » /0 »f /0 Supplements for Supplements to Natural solutions Nutrients to weight control combat fatigue for skin, hair
Slide 13: Direct marketing in pharmacies and distributor network
Direct marketing in pharmacies in France, Spain, Benelux and Portugal and network of distributors in over 20 countries 1. Calculated over the target 2. Including 20 countries: Greece, Ucrania, Bulgaria, Morocco, Tunisia, Lebanon, French Antilles, Reunion Island, Madagascar, Mayotte, Cameroon, Senega
Slide 14: Solid operational and financial structure
NATRACEUTICAL TODAY Solid operational and financial structure Turnover wag BR @ 2011 2012 2013 Net financial debt 56.60 -0.16" .2.93 * Not including cash position of 14.52 ME following some assets disposal Figures in million euros EBITDA Net result F | @ 16.07* 0.86 2.57 -414 Employees @ 100 0.95 -0
Slide 15: 03. Two Synergistic Industries
STEROL ©. 03. TWO SYNERGISTIC INDUSTRIES
Slide 16: Food supplements companies approach the pharmaceutical industry
Food supplements companies approach the pharmaceutical industry... ... while pharmaceutical companies seek alliances in the food supplements sector or develop their own offer * Over-the-counter: Pharma product without medical prescription ** Rx: Pharma product with medical prescription 11
Slide 17: Pharma companies in food supplements
The multinational Merck is promoting its food supplements The Japanese pharma company Otsuka has its line of area under the brand "Bion", mainly in the vitamins range. slimming products biManán through its subsidiary Nutrition Santé. The multinational pharma company Reckitt Benckiser acquired in Nov
Slide 18: 04. Laboratorio Reig Jofre Today
ye OR Os ©. 2 04. LABORATORIO REIG JOFRE *S TODAY
Slide 19: Development of own products
2001-2014 1992-1996 1929-1991 Development of own products Several acquisitions in Fully focus on (pharmaceuticals, food the OTC segment, developing, supplements and cosmetics) focusing on dermatology. manufacturing and and strengthening of the marketing of international position. 1997-2001 pharmaceu
Slide 20: Laboratorio Reig Jofre financials
Figures in million euros Data prior to 2012 not available in IFRS accounting rules. Not included as it is not comparable. 15
Slide 21: Strategic approach towards higher value segments
LABORATORIO REIG JOFRE TODAY Strategic approach towards higher value segments 2013 sales: 118.3 M€ Development and manufacture of own products Therapeutic areas Dermatology, gynecology, respiratory, antibiotics and healthcare consumer Products Pharmaceuticals (prescription and non-prescription), gen
Slide 22: Portfolio of own products
Dermatology Acne, hair and nails yduct: Anaclosil Medebiotin Complidermol Complidermol 5a Deripil Eridosis TriHachemina Nutridermis Medetopic Mede H Ginecology Preterm birth and oncology Products Nife-par GynEC DX Pre-par Orvangel Medegin Ple-Par ampotlas itocrina Solucion acuose | ‘oem \sonarom ne
Slide 23: Maximum technological standards and quality for other laboratories
LABORATORIO REIG JOFRE TODAY Maximum technological standards and quality for other laboratories = Boehringer th NovaRTIS Gua @ il Ingelheim infal = i ti (iti em (~ EUVEDICA fSferrer pawpaxy [BION o° a Grupo Gi Uriach W,, = GRIFOLS mt SIGMA WOK ARDT sanofiaventis Te Australian Company ~ KU MAVIOU coo
Slide 24: Own sales network and presence in 87 countries
Own network of sales representatives for doctors(1), hospitals and pharmacies in Spain and the Nordic countries and presence in 87 countries through over 180 distributors and/or licensees 1. General practitioner, dermatologists and gynecologists, mainly 2. Including 40 countries, mainly: Italy, Finl
Slide 25: Modern specialized production centers
LABORATORIO REIG JOFRE TODAY Modern specialized production centers Toledo e + Constructed area: 15.297m? in two different plants + Employees: 254 + Activity: production of penicillanic antibiotics and cephalosporins + Approved in 2013 by FDA Barcelona + Constructed area: 19.799m? + Employees: 180 +
Slide 26: 05. Industrial Sense of the Merger
OM get. P2.0o.2%+ 2 05. INDUSTRIAL SENSE Te. OF THE MERGER
Slide 27: Strengthening of the resulting company by vertical integration
INDUSTRIAL SENSE OF THE MERGER Strengthening of the resulting company by vertical integration Research, development, production and combined access to international markets Complementarity Strengthening of products byR&D&I Medicines Improved of strategic position due OTC to LRJ’s strength inR&D&l Fo
Slide 28: Vertical integration: production
INDUSTRIAL SENSE OF THE MERGER Strengthening of the resulting company by vertical integration Research, development, production and combined access to international markets PRODUCTION Productive capacity Other Productive and technical capacity at Savings in procurements LRJ's facilities to manufactu
Slide 29: Vertical integration: marketing
INDUSTRIAL SENSE OF THE MERGER Strengthening of the resulting company by vertical integration Research, development, production and combined access to international markets MARKETING Geographical complementarity Own network in Spain, Portugal, France, Benelux and Nordic countries Network of internat
Slide 30: Direct cost savings estimated at 2.5 M€
Direct cost savings estimated at 2.5 M € from operational improvements after the merger. Potential significant improvement in revenues and margins of the new company, thus increasing profitability and enhancing a sound business and financial structure. 25
Slide 31: 06. NTC after the Integration of LRJ
©, oO © SO Gel. 22.00.98: 2 06. NTC AFTER THE INTEGRATION OF LRJ
Slide 32: Combined figures 2013
Figures in million euros 2013c: combined figures of the two companies. LRJ year closing: September. NTC year closing: December 27
Slide 33: Combined figures of the two companies according to 2013 closing
Combined figures of the two companies according to 2013 closing 28
Slide 34: Natraceutical after the merger
NATRACEUTICAL AFTER THE MERGER
Slide 35: 07. Forecast of 2014 Results
DP Ge. 2.Qo 9: 2 OF FORECAST OF 2014 RESULTS Oo
Slide 36: Estimated combined 2014 results
Figures in million euros 2013c: combined data from the two companies 2014e: estimated combined closing for 2014. Recurring EBITDA. It does not include merger costs, which may amount to approx. 2.0 M€ for both companies together LRJ year closing: September. NTC year closing: December. 31
Slide 37: 08. Structure of the Merger and New Shareholder Composition
O: Ono: : O ener . 08. STRUCTURE OF THE MERGER AND NEW SHAREHOLDER COMPOSITION
Slide 38: Merger structure and share issue
• Merger transaction structured by integration of LRJ by NTC, entailing extinction of LRJ and transfer of its equity to NTC. • The companies' valuation by comparable multiples and discounted cash flows resulted in a exchange ratio in the resulting company of 26% for current NTC shareholders and 74%
Slide 39: 09. Corporate Governance
Osesoe Regn 2 Oto Oa os oe) ° 09. CORPORATE GOVERNANCE
Slide 40: Proposed board composition of the new company
In response to the recommendations forwarded by the Spanish National Stock Market Commission to the board of directors of both companies, NTC will submit to its shareholders' approval the following composition of the board of directors of the new company: 3 proprietary directors (33%) representi
Slide 41: Independent directors: Anton Costas Comesaña and Mª Luisa Francoli Plaza
ANTON COSTAS COMESAÑA Mª LUISA FRANCOLI PLAZA Education Education • Industrial engineer • Degree in Economics at the University of Barcelona. • Bachelor of Economics and Business • MBA in Finance at the University of St. John, New • Doctor of Economics York. Academic activities Professional experien
Slide 42: Independent directors: Ramon Gomis and Ramiro Martinez-Pardo
RAMON GOMIS I DE BARBARA RAMIRO MARTINEZ-PARDO DEL VALLE Education •Bachelor of Medicine Education • PhD in Medicine from the University of Barcelona • Degree in Economics and Business from the •Postdoctoral training at the Free University of Brussels Complutense University of Madrid. in endocrinolo
Slide 43: Emilio Moraleda Martinez
EMILIO MORALEDA MARTINEZ Formación académica • Degree in Law from the Complutense University of Madrid • Diplomas in Human Resources and Business Administration from the Universities of Columbia and Harvard (USA). • Social graduate by the Social School of Madrid Professional experience He is current
Slide 44: 10. Other Information
P28 Oe 2. 2 10. OTHER INFORMATION .o)
Slide 45: The new company: key ratios
THE NEW COMPANY Key ratios 0 REIG JOFRE natraceutical nF www.reigjofre.com Economic information 2012 2013 2012-2013 Economic information 2012 2013 2012-2013 Turnover 29.93 31.37 4.8% Turnover 105.28 118.27 12.3% EBITDA 0.86 2.57' 198.8% EBITDA 10.93 13.55 23.9% EBIT 0.13 2.01 1446.2% EBIT 644 9.07 4
Slide 46: Recurring 2014 EBITDA figures
Figures in million euros Recurring 2014 EBITDA. It does not include merger costs, which may amount to approx. 2.0 M€ for both companies together LRJ year closing: September. NTC year closing: December. 41
Slide 47: Comparable multiples
COMPARABLE MULTIPLES I ¥ nee ev | Evisales | EVIEBITDA EV/EBIT | PER | EBITDA Mg. | 2013-2015E CAGR | EBIT M 2013E 2014E 2015E 2013E 2014E 2015E 2013E 2014E 2015E 2013E 2014E 2015E — 2013E Sales EBITDA —2013E Roche Switzerland 184,946 232,994 5.0x 49x 48x 11.8 11.7x 1x 13.4x13.0x 12.4x18.5x17.8x_— 1
Slide 48: Reig Jofre Group and Natraceutical contact
REIG JOFRE Group www. reigjofre.com natraceutical Av. Alcalde Barnils, 64-68, Edificio A, 12 32 08174 St. Cugat del Vallés Barcelona, Espafia Tel. (+34) 93 584 8185 www.natraceuticalgroup.com Relacion con Inversores Gloria Folch gloria.folch@natraceuticalgroup.com
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