Galenica AG · SIX:GALE
Galenica — Non-Deal Roadshow (September 2017)
30 slides from Galenica's roadshow presentation, September 2017
Slide 1: Galenica Group Investor Presentation
Galenica Group Investor Presentation September 2017
Slide 2: Agenda
Agenda Page 1 History 3 2 Galenica at a glance 6 3 Business Sectors 11 4 Financial track record 16 5 Business Update H1 2017 18 6 Outlook 28 Sept 2017 − © Galenica 2
Slide 3: Building the leading Swiss healthcare platform over 90 years
1 Building the leading Swiss healthcare platform over 90 years Creation of Acquisition of Foundation of Amavita uniform Merfen® and Galenica as a brand in Vita-Merfen® wholesaler Switzerland Organic and acquisition-led IPO of Listing on Expansion of expansion of Acquisition of Creation of Galenica S
Slide 4: History of resilient growth and margin improvement
1 History of resilient growth and margin improvement Logistics, HealthCare Information & Retail1 Galenica Santé 2006–16 CAGRs 2006-16 Retail market sales2 2.4% sales CAGR1 5.3% Galenica Santé net sales1 5.3% Galenica Santé EBIT1,3 25.2% 3,009 2,915 5% 2006-16 2'766 2'826 25.2% 2'603 2'661 EBIT CAGR1
Slide 5: April 2017: Outstanding IPO of Galenica Santé
1 7 April 2017: Outstanding IPO of Galenica Santé Largest IPO in Europe in H1 2017 and first sizeable 100% subsidiary IPO since years Multiple oversubscription with pricing at the top end of the price range at CHF 39.00 HF 13% Other 15% Broadly diversified PB allocation 30% 48.75m US 48.75m CH
Slide 6: Galenica is the leading healthcare provider in Switzerland
2 Galenica is the leading healthcare provider in Switzerland 2016 net sales CHF3,009m 2016 EBIT1 CHF134m Health & Beauty Services Retail Products & Brands Market position2 #1 Consumer Health market position2 #3 Market position2 #1 2016 net sales 2016 EBIT 2016 net sales 2016 EBIT (pre eliminations o
Slide 7: Operating in a stable and attractive Swiss healthcare market
Operating in a stable and attractive Swiss healthcare market 2 with favourable long-term fundamentals Resilient, stable Swiss healthcare retail sector2 Pharmaceutical market in Switzerland (2016)1 CHFbn (based on ex-manufacturer price) 2016-20 CAGR 1.7%33 By value−CHF5.6bn By volume−188 million pack
Slide 8: Experienced management team with proven track record
2 Experienced management team with proven track record Jean-Claude Clémençon CEO since IPO CEO Head of Business Sector Retail since 2015, 28 years industry experience of which 22 years at Galenica Group Head of Business Sector Joined Galenica Group in 1995 Retail until Q4 2017 Previously, He
Slide 9: Galenica: The first choice for health, beauty and wellbeing
2 Our ambition and self-perception Galenica: The first choice for health, beauty and wellbeing. Sept 2017 − © Galenica 9
Slide 10: Our Strategy - the power of leverage drives sustained value creation
2 Our Strategy - the power of 3 drives sustained value creation Products & Brands Leverage leading positions to promote higher margin and exclusive products Develop and launch own and partner brands and products for pharmacies Leverage Further expand and optimise retail Retail 2015 2016 networ
Slide 11: The largest pharmacy retailer in Switzerland
3 The largest pharmacy retailer in Switzerland Retail Network of chains (# of pharmacies as of 30 June 2017) Webshop Competitive positioning—#1 market position4 Largest branded pharmacy network by By number of pharmacies5 Total # of pharmacies as of 2016 number of pharmacies in Switzerland 1,792
Slide 12: Ongoing pharmacy network consolidation and optimisation
3 Ongoing pharmacy network consolidation and optimisation Retail Proven track record of delivering synergies Widely spread pharmacy network covers every through streamlining of business processes and Region in Switzerland creating value through acquisitions and network optimisation Marketing IT
Slide 13: Diversified product portfolio for health, beauty and wellbeing
3 Diversified product portfolio for health, beauty and wellbeing Retail GaleniCare’s retail product offering in % of sales1 12% 37% 20% 51% 17% 10% 4% Beauty Nutrition, Personal OTC medicines Prescription medicines and Patient Care of which originals of which generics 1 Sales YTD June 2017, includes
Slide 14: Leading role in Consumer Health with broad and innovative product portfolio
Leading role in Consumer Health with broad and 3 innovative product portfolio Products & Brands Portfolio Competitive position: #3 Consumer Health1 market position ORAL PAIN OTC consumer health brands REMEDIES Market share2 (%) No. 1 New 29% market share2 5.9 5.4 5.1 TOPICAL PAIN (Exclusive) partner
Slide 15: Leader in pre-wholesale and wholesale distribution
Leader in pre-wholesale and wholesale distribution, supported 3 by an innovative healthcare information business Services Services Competitive positioning - #1 market position1 Pre-wholesale outsourced storage and distribution Pre-wholesale market share % Wholesale market share % Logistics servi
Slide 16: Long-term track record of sustainable growth and attractive cash generation
Long-term track record of sustainable growth and 4 attractive cash generation … Logistics, HealthCare Information & Retail1 Galenica Santé 2006-16 CAGRs Retail market sales2 2.4% Galenica Santé net sales 5.3% Net sales (CHFm) Galenica Santé EBIT3 25.2% Above market growth 2'766 2'826 2'915 3'009 2
Slide 17: Demonstrating strong performance in both segments
4 … demonstrating strong performance in both segments Health & Beauty Services Retail Health & Beauty Logistics and HCI Services 19.5% 3.8% 3.4% 3.6% Net sales (CHFm) 2,329 2'158 2'171 2,245 1'703 1'335 1'393 1,437 1'246 358 2006A … Health & Beauty 2013A 2014A 2015A 2016A 2006A … Health & Beauty 201
Slide 18: First half year 2017 - We are on track
First half year 2017 - We are on track 5 Pleasing development and very solid results 1. Very solid results Net sales increased (+6.8%) EBIT increased (+14.1%)1) 2. ROS increased (up to 4.8%)1) 3. Strong net profit growth All activities of the Group made further progress 1) Including CHF 7.0 mi
Slide 19: Expansion of activities
5 EXPANSION of activities Retail Products & Brands Services Further reinforcement Acquisition of Merfen® Acquisition of of the pharmacy and Vita-Merfen® Pharmapool, network Wholesaler for self New beauty brands: dispensing Doctors Lierac, Phyto Own pharmacies: 332 New partner brands: Total
Slide 20: Innovation: new products and services
5 INNOVATION: new products and services Click&Collect: Aprioris: MedCenter: the pharmacy goes online The walk-in-clinic, on-line supported pilot project drug purchase, pilot project Sept 2017 − © Galenica 20
Slide 21: Efficiency: new products and services
5 EFFICIENCY: new products and services 1. ERP project Modulo (Pre-Wholesale & Wholesale) 2. TriaPharm® at Coop Vitality (including direct invoicing) Synergies 3. Process alignment in Retail Healthcare Information 21 Sept 2017 − © Galenica
Slide 22: Swiss Pharmaceutical market - continuous value growth (YTD June 2017)
5 Swiss Pharmaceutical market − continuous value growth (YTD June 2017) Market1 Value CHFm Share Change Market1 Value CHFm Share Change Total: 2’845.7 100% -1.2% Retail2: 2’174.9 100% -1.0% 3.9% 2.9% -3.8% 0.0% Hospitals: 670.8 23.6% RX3: 1’809.6 83.2% 7.6% 3.6% -0.4% -1.8% Physicians: 718.8 25.2% O
Slide 23: Galenica Group - Pleasing development
5 Galenica Group − Pleasing development Net sales (in million CHF) EBIT adjusted1 (in million CHF) +6.8% +14.1% 3'009 134.2 76.6 49.4% 1'487 1'587 67.2 50.1% 4.8% 4.5% 4.5% 2016 HY2016 HY2017 2016 HY2016 HY2017 1 excluding the effects of IAS19 EBIT Margin (ROS) Highlights: Strong growth thanks to:
Slide 24: Health & Beauty segment - Increasing EBIT margin
5 Health & Beauty segment − Increasing EBIT margin Net sales (in million CHF) EBIT (in million CHF) 1'437 +2.9% Retail 1,349 709 730 +6.5% 93.5 49.1% 662 679 +2.5% 46.5 49.5 P&B 89 49.8% 6.8% 53.6% 6.5% 6.6% 48 51 +6.8% 2016 HY2016 HY2017 2016 HY2016 HY2017 EBIT Margin (ROS) Highlights: 1.3% Retai
Slide 25: Services segment - expanded offering with Pharmapool
5 Services segment − expanded offering with Pharmapool Net sales (in million CHF) EBIT (in million CHF) +7.4% +41.9% 39.9 2'329 28.7 49.3% 1'148 1'234 20.2 50.7% 2.3% 1.7% 1.8% 2016 HY2016 HY2017 2016 HY2016 HY2017 EBIT Margin (ROS) Highlights: Successful integration of Pharmapool from day one (ab
Slide 26: Favourable financial and tax costs support strong net profit
Galenica Group − 5 Favourable financial and tax costs support strong net profit Net profit (in million CHF) Tax rate 1HY 2017 EBIT adjusted1 76.6 20.0% 22.0% Financial result 18.0% adjusted1 (0.8) Income tax adjusted1 (13.7) 2016 HY2016 HY2017 Net profit adjusted1 62.1 Highlights: Long-term financ
Slide 27: Galenica Group - Strong balance sheet
5 Galenica Group − Strong balance sheet Investments in million CHF Net debt / Equity in million CHF % of sales 1.2% 1.1% 2.1% Debt coverage2 2.0x 1.7x Cash conversion3 80% 81% 65% 43% 45% 35.0 33.5 745 790 3.6 17.0 19.4 21% 17% 1.7 31.4 350 309 15.3 14.1 2016 HY2016 HY2017 1.1.17 1 HY2017 Investment
Slide 28: Guidance 2017
6 Guidance 2017 Sales Sales growth in line with the first half of 2017 Growth of EBIT adjusted (excluding the effects of IAS 19) between +7% and + 12%, including EBIT positive one-off effects of CHF 7.0 million Intention to pay out a dividend of 80 million in 2018, out of the Capital Contribution Re
Slide 29: Contact information
Galenica Group Contact information Investor Relations Media Felix Burkhard Christina Hertig CFO Galenica Head Corporate Communication Tel.: +41 58 852 85 29 Tel.: +41 58 852 85 17 Mail: investors@galenica.com Mail: media@galenica.com Sept 2017 − © Galenica 29
Slide 30: Disclaimer
Disclaimer Certain statements, beliefs and opinions in this presentation are forward-looking, which reflect the Company’s or, as appropriate, the Company’s directors’ current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, unce