Animalcare Group Plc · LSE:ANCR
Animalcare — FY2023 Earnings Presentation
23 slides from Animalcare's earnings presentation, Apr 9, 2024
Slide 1: Full year results 2023
I N V E S TO R P R E S E N TAT I O N Full year results 2023 Jenny Winter, Chief Executive Officer Chris Brewster, Chief Financial Officer
Slide 2: Disclaimer
Disclaimer The information contained in this confidential document (“Presentation”) has been prepared by the Company. It has not been verified by the Company and is subject to material updating, revision and further amendment. This Presentation has not been approved by an authorised person in accord
Slide 3: Strategic priorities underpinned by strong foundations
Strategic priorities underpinned by strong foundations ORGANIC GROWTH INORGANIC GROWTH NEW PRODUCT DEVELOPMENT Develop and nurture new and Pursue external opportunities Leverage our science focus and existing veterinary brands that that enhance revenue and development capability to deliver sustainab
Slide 4: Highlights for 2023
Highlights for 2023 ORGANIC GROWTH INORGANIC GROWTH NEW PRODUCT DEVELOPMENT • Positive market response to • Animalcare continues to be • Orthros Medical VHH antibody Plaqtiv+ dental range highly active in pursuit of M&A pre-clinical studies continue to • Daxocox records double-digit and partnering o
Slide 5: Dynamic, growing animal health market
Dynamic, growing animal health market Competitive sector with attractive long-term fundamentals • Global market grew c.5% in 2023; Europe up c.7% • Companion Animals the main driver of growth • Continuing high levels of pet ownership1 • Increased propensity to spend on pet wellbeing2 • Changing cust
Slide 6: Strong performance in line with market expectations
Strong performance in line with market expectations Revenue Underlying* EBITDA ↑3.8% ↑1.5% £13.3m 2023 2022 £74.4m 2023 2022 £74.4m £71.6m £13.3m £13.1m Up 2.5% at CER Underlying EBITDA margin 17.9% (18.3% for 2022) Gross margin Net debt/cash** ↑1.5% 58.3% 2023 2022 ↓£4.1m 2023 2022 £1.7m 58.3% 56.8
Slide 7: Growth in revenues and gross margins
Growth in revenues and gross margins Change at Underlying financial results 2023 2022 AER Revenue increase of 3.8% (AER) with strong second half Revenue £74.4m £71.6m 3.8% • Growth across all three product categories Gross profit £43.3m £40.7m 6.6% Increase in gross margins, up 1.5% versus prior yea
Slide 8: Companion Animals: main driver of growth
Companion Animals: main driver of growth 2023 revenue £52.2m ↑4.0% Companion Animals: Companion Animals 2023 performance summary • Revenue increase of 4.0% benefiting • Identicare continued strong from growth of new products which momentum over course of 2023 contributed £1.9m: approximately • Reven
Slide 9: Production Animals: continuing demand for protein
Production Animals: continuing demand for protein 2023 revenue Production Animals: 2023 performance summary • Production Animal revenues, which versus the prior period to £15.8m, are chiefly generated by our reflecting the launch of a distribution Southern European and product and growth in certain
Slide 10: Equine and others: attractive specialist market
Equine and others: attractive specialist market 2023 revenue Equine: 2023 performance summary • Equine and other sales increased • Danilon growth accelerated £6.3m ↑10.9% by 10.9% to £6.3m, benefiting during the second half due to from bringing Danilon, one of our stock in channel placed by our larg
Slide 11: Organic growth: new products helping drive revenues
Organic growth: new products helping drive revenues Daxocox: 16% revenue growth in competitive market Plaqtiv+: revenues increased by approx. £1m in 2023 Confident in future growth: Confident in future growth: • Increasing size of elderly dog population • Dental disease is a rapidly growing segment
Slide 12: Quality of portfolio continues to evolve and strengthen
Quality of portfolio continues to evolve and strengthen Common pet diseases • Cruciate ligament LIFETIME VALUE stabilization • Early onset cancer • Dental care • Atopic dermatitis • Neutering • Kidney disease • Brachycephalic • Heart disease • Cancer • Animalcare’s portfolio addresses important area
Slide 13: Identicare disposal crystallises value of non-core asset
Identicare disposal crystallises value of non-core asset Refocus under specialist leadership increases value of pet reunification business Repositioning of pet reunification business as a scalable, high margin, recurring-revenue subscription platform generates value through sale of majority stake FY
Slide 14: Transformational change strengthens firepower
Transformational change strengthens firepower Strengthened balance sheet supports pursuit Cash conversion 2023 2022 of growth opportunities Underlying EBITDA £13.3m £13.1m • Cash conversion improved to 85.7% Working capital movement (£1.3m) (£1.9m) • £1.4m in R&D investment and milestone payments •
Slide 15: Strategic priorities: how this can contribute to growth
Strategic priorities: how this can contribute to growth ORGANIC GROWTH INORGANIC GROWTH NEW PRODUCT DEVELOPMENT Develop and nurture Pursue external Generate innovative new and existing opportunities treatments veterinary brands EBITDA growth Promotion of Expand In-licensing Acquire In-licensing Inno
Slide 16: Business development: ambitious, active and disciplined
Business development: ambitious, active and disciplined Inorganic growth central to strategy Velocity increased • Seeing increasing openness to explore dealmaking options • >450 products and companies assessed • >40 products and companies of interest • Reallocation of internal resources further stre
Slide 17: Orthros VHH antibody-based agreement progressing
Orthros VHH antibody-based agreement progressing Partnership model yielding results; opening pathways to options for novel therapies Agreement Agreement to to co-develop. co-develop. STATUS: LICENCE Animalcare to commercialise, Animalcare to commercialise, Clinical studies in equines specific candid
Slide 18: Capital allocation aligned to our strategic priorities
Capital allocation aligned to our strategic priorities Investing in accelerating growth and value creation while rewarding shareholders Capital priorities £11.8m returned to shareholders over last five years through dividends Organic growth • Continued investment in people and operational excellence
Slide 19: Summary and outlook
Summary and outlook • Group delivers revenue growth in 2023 with increased sales across all three product segments • Continuing focus on larger-selling, more profitable brands manifested in improved gross margins • Disposal of Identicare in February 2024 transforms financial position • Orthros VHH a
Slide 20: Full year results 2023
I N V E S TO R P R E S E N TAT I O N Full year results 2023
Slide 21: Appendix
APPENDIX “S Ani , Animalcare Y GROUP
Slide 22: Consolidated income statement
Consolidated income statement Unaudited Unaudited Unaudited For the year ended 31 December underlying non-underlying total Underlying Non-underlying Total 2023 2023 2023 2022 2022 2022 £’000 £’000 £’000 £’000 £’000 £’000 Revenue 74,351 − 74,351 71,616 − 71,616 Cost of sales (31,005) − (31,005) (30,9
Slide 23: Consolidated cash flow
Consolidated cash flow For the year ended 31 December Unaudited Unaudited 2023 2022 2023 2022 £’000 £’000 £’000 £’000 Operating activities Investing activities Profit before tax 3,523 2,542 Purchase of property, plant and equipment (52) (407) Non-cash and operational adjustments Purchase of intangib