Wuxi Biologics (cayman) Inc. · HKEX:2269
Wuxi Biologics (cayman) — FY2023 Earnings Presentation
55 slides from Wuxi Biologics (cayman)'s earnings presentation, Mar 26, 2024
Slide 1: Inside Information - 2023 Annual Results Presentation
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in relia
Slide 2: Announcement notes and forward-looking statements
Please use the links provided above to complete the online registration process in advance of the conference calls. Further, to ensure that all shareholders and investors have equal and timely access to such information, the Company has included in this announcement the full copy of the Presentation
Slide 3: Global Premier CRDMO: 2023 Annual Results
Global Premier CRDMO: Enabling Global Partners and Delivering Sustainable Growth 2023 Annual Results March 2024 Stock Code: 2269.HK
Slide 4: Forward-Looking Statements; Use of Adjusted Financial Measures
Forward-Looking Statements This presentation may contain certain “forward-looking statements” which are not historical facts, but instead are predictions about future events based on our beliefs as well as assumptions made by and information currently available to our management. Although we believe
Slide 5: Contents
CONTENTS Global Operations on track to Support 01 2023 Annual Results 02 Business Growth State-of-the-art Technologies Lead to WBS and ESG as Important 03 Future Success 04 Components of Business Strategy 05 Financial Overview 06 Summary 07 3
Slide 6: 2023 Annual Results
2023 Annual Results 01
Slide 7: 2023 Key Metrics
588 → 698 15.27 → 17.03 18.7% 11.6% Integrated Projects YoY Revenue (RMB Bn) YoY 37.7% 5.05 → 4.95 -2.0% Non-COVID Revenue Growth (YoY) Adj Net Profit (RMB Bn) YoY 132 45.3% New Projects Added Adj Gross Profit Margin 17 → 24 41.2% 29.1% Adj Net Profit Margin Commercial Projects YoY 20.59 41.1% Total
Slide 8: Financial Performance
Financial Performance Revenue Gross Profit Adj Gross Profit RMB +11.6% Non-COVID GP Margin 44.0% 40.1% Adj GP Margin 50.0% 45.3% (mm) 17,034 +37.7% 16,506 15,269 7,638 6,724 6,828 7,723 11,985 +1.5% +1.1% 2022 2023 2022 2023 2022 2023 Adj Net Profit Net Profit Adj EBITDA Adj Adj Net Profit Net Profi
Slide 9: Key Financials
Key Financials • Available funds approx. RMB11.2 bn as of Dec 31, 2023 AVAILABLE FUNDS • Total Liability to Equity Ratio 28.5%, expect to have sufficient funds for capacity increase • 2023 CAPEX approx. RMB4.1 bn, mainly for capacity increase in Europe CAPEX and U.S. • 2024 CAPEX Plan: approx. RMB5
Slide 10: Non-COVID Projects Continued to Accelerate and Delivered Steady Revenue Growth
Non-COVID Projects Continued to Accelerate and Delivered Steady Revenue Growth By Project Phase COVID VS Non-COVID RMB RMB 17,034.3 (mm) 17,034.3 (mm) 284.5 15,268.7 15,268.7 528.3 261.0 +12.8% 7,731.5 3,283.4 -83.9% 6,854.3 Non-COVID: +101.7% 16,506.0 +12.7% 3,616.5 3,207.8 11,985.3 +37.7% 4,945.6
Slide 11: Non-COVID Projects Driving Growth with Sustained Momentum
Non-COVID Projects Driving Growth with Sustained Momentum Growth of Non-COVID CMO Project RMB Growth of Non-COVID Revenue (mm) Number 16,506.0 16 11,985.3 11 7,361.7 5 2021 2022 2023 2021 2022 2023 • CMO growth and the Non-COVID growth are the sustainable pillars for the Company’s growth • The succe
Slide 12: R in CRDMO
R in CRDMO Accelerated Growth in Milestone and Research Services Revenue Milestone and Research Services Revenue 87.0 US$ mm 26.9 19.7 2021 2022 2023 • Benefitted from the comprehensive technology platforms, milestone and research services revenue achieved 110.1% CAGR growth from 2021 to 2023, demon
Slide 13: New Projects Rebound from the Bottom in Q1 2023
New Projects Rebound from the Bottom in Q1 2023: 2023 is One of the Highest Levels of New Projects No. of Newly Added Integrated Projects 138 (1) 136 132 127 71 132 124 103 85 15 61 58 57 59 38 46 8 2017 2018 2019 2020 2021 2022 2023 1Q 2023 2Q 2023 3Q 2023 4Q 2023 New total projects New non-COVID p
Slide 14: Win-the-Molecule Strategy: Another Driver to Expand Pipeline
“Win-the-Molecule” Strategy: Another Driver to Expand Pipeline 2018 2019 2020 2021 2022 2023 • 9 phase III and Commercial “Win-the-Molecule” projects: record high, 9 69 significantly higher than our original expectation of 5 • Total 69 projects at different stages (Phase I, II and III + CMO) transfe
Slide 15: New Projects Exceeded Expectations
New Projects Exceeded Expectations: Demonstrate Business Resilience Despite Headwinds • Continue to gain growth opportunities for WuXiBodyTM OMT Platform ADC Platform SDArBodYTM both “Follow and Win the Molecule” • Despite headwinds, newly-added projects reached one of the highest levels since “R” M
Slide 16: Backlog Underpins Future Performance
Backlog Underpins Future Performance Service Backlog Upcoming Potential Milestone Fees (1) • As of Dec 31, 2023, total backlog reached Backlog within 3 Years US$20.6 bn. US$13.4 bn service backlog as of Dec 31, 2023, the slight decrease is partially (US$ bn) 20.59 attributable to the COVID cancellat
Slide 17: Rich Pipeline across All Biologics Modalities
Rich Pipeline across All Biologics Modalities Total 698 Integrated 588 18.7% • 259 First-in-class programs 308 • 25 vaccine projects, including 19 non-COVID mAb 274 12.4% vaccines BsAb (1) 114 15.2% • 114 bispecific projects covering different formats, 99 several in phase III and commercial stage wi
Slide 18: CMO Continues with Strong Momentum: No. of PPQs
CMO Continues with Strong Momentum as Shown by Leading Indicators: No. of PPQs DS PPQ • Robust growth in drug 34%+ 52% substance (DS) and drug 9+ 1 product (DP) PPQs, in line with our CMO project 34 38+ 23 increase: will add more in 9 14 4 2024 2019 2020 2021 2022 2023 2024 China EU • Growing number
Slide 19: Sustained Growth with Diverse Engines
Sustained Growth with Diverse Engines North EU America China Rest(1) 172.4% Non- 20.2% Non- -1.2% Non- 37.7% Non- COVID COVID COVID COVID Growth Growth Growth Growth 30.2% of Revenue 47.4% of Revenue 18.3% of Revenue 4.1% of Revenue • Europe: the market with the fastest growth rate. Non-COVID revenu
Slide 20: Bispecifics to be Another Growth Driver - WuXiBody
Bispecifics to be Another Growth Driver – WuXiBodyTM WuXiBodyTM Projects WuXiBodyTM Development Cutting-Edge Progress 45 45 Technology 39 35 33 31 Empower to discover best 27 24 23 or first-in-class molecules 17 19 13 6 7 5 4 3 2018 2019 2020 2021 2022 2023 Total Drug PCC CMC Phase I Discovery Custo
Slide 21: WuXi XDC's Powerful Platform and Business Model
WuXi XDC’s Powerful Platform and Business Model to Secure Project Wins and Fuel The Growth Number of Projects Through “Enable – Follow – Win” Strategy "Research”: Enable discovery to PCC “R” 427 Discovery(1) / 299 (3) 36 projects advanced from discovery to iCMC stage (1) 84 Preclinical / 57 (3) "Dev
Slide 22: Progress of WuXi Vaccines
Progress of WuXi Vaccines Serving 27 Clients on 59 Projects Cumulative Number of Projects and Clients Our Clients 7% 8% 2019 - 2023 4% Global Vaccine Leader Number of Projects Number of Clients 59 MNC Pharma 33% US/EU Biotech 48% China Clients 44 Others 28 27 21 7 Vaccine Type 6 Recombinant-Mammalia
Slide 23: Quality is Our Competitive Advantage
QUALITY is Our Competitive Advantage Number of Regulatory Inspections Completed: 33(1) Number of License Approvals: 48 (64 by Facility) Facility MFG1 MFG2F MFG2P MFG4 MFG5 DP1 DP4 MFG3(CB) MFG3 Agency WBP XXX WBP XXX WBP XXX WBP XXX/ 1 FDA (6) WBP XXX WBP XXX WBP XXX WBP XXX WBP XXX 33 WBP XXX WBP X
Slide 24: Leading Indicators of Quality: Client Audits
Leading Indicators of Quality/Regulatory Inspections: Continue to See Favorable Trends During Client Audits Major Findings per Audit Critical+ Major Findings 90 Total of Client Audits 80 Major finding Rate 70 65 65 64 63 63 61 56 58 60 55 55 50 48 50 1.71 45 41 38 36 1.34 37 36 40 35 29 29 30 29 27
Slide 25: Global Operations on track to Support Business Growth
Global Operations on track to Support 02 Business Growth
Slide 26: Robust Global Network to Enable Partners
Robust Global Network to Enable Partners: Multiple Nodes with Geographic Diversity Global CRDMO: 3 R centers 8 D centers 9 M centers R: Shanghai WGQ, Shanghai FX, Boston D: Shanghai WGQ, Wuxi, Shanghai FX, Chengdu, Hangzhou, Suzhou, Cranbury NJ and Singapore M: Wuxi, Hebei, Chengdu, Hangzhou, Wupper
Slide 27: Groundbreaking on CRDMO Center in Singapore
Groundbreaking on CRDMO Center in Singapore The Company has broken ground on its new 13.5-hectare CRDMO center in Singapore. The center will provide integrated biologics research, development and manufacturing services The CRDMO site will add 120,000L manufacturing capacity to WuXi Biologics’ global
Slide 28: New Chapter for Global Operations
New Chapter for Global Operations • MFG6/7 GMP released • MFG19 will further • MFG18, the first • In response to global • A 48,000L commercial in Q4 2022, and increase to 12x2,000L clinical manufacturing clients’ increasing DS manufacturing received first GMP facility in U.S., started facility GMP r
Slide 29: Ireland Ramp-up Ahead of Schedule: Expect to Break Even in 2024
Ireland Ramp-up Ahead of Schedule: Expect to Break Even in 2024 • Ireland site completed construction with record speed and received the 2023 Facility of the Year Award (FOYA) in the Operations category from ISPE • GMP runs at both facilities are proceeding as expected: the first PPQ batch was succe
Slide 30: State-of-the-art Technologies Lead to Future Success
State-of-the-art Technologies Lead to 03 Future Success
Slide 31: WuXi Bio's Proprietary Clinical Stage Anti-CD3 mAb
WuXi Bio’s Proprietary Clinical Stage Anti-CD3 mAb Empowers Discovery of Best-in-Class T Cell Engagers (TCEs) WuXi CD3 Platform Highlights Potent Tumor Killing with Minimal Cytokine Release • 3 TCEs in clinical stage (Ph1 clinical trials) • Cynomolgus monkey cross-reactive CD3 binder • Unique epitop
Slide 32: WuXiUI Performance and Strategic Applications
WuXiUITM Performance and Strategic Applications to Biologics Commercial Manufacturing Productivity Comparison WuXiUITM Ultra-Intensified FB Bioprocessing Strategy WuXiUITM vs. TFB Titer Folds of Increase 30 516% 6 503% • 3~6 folds of TFB productivity with WuXiUITM 452% Folds of Increase 25 188% 5 33
Slide 33: Disposable Bioreactors CAN Deliver Lower COGS
Disposable Bioreactors CAN Deliver Lower COGS than Traditional Stainless Steel VS VS Disposable 30%+ more expensive Disposable ~10% cheaper 2,000L Single-use Bioreactor 12,000L Traditional Stainless Steel Bioreactor 12,000L Traditional Stainless Steel Bioreactor 6x2,000L Single-use Bioreactor VS VS
Slide 34: Global MNC Applies Single-use Technology at its Ireland Site
Global MNC Applies Single-use Technology at its Ireland Site Another Demonstration for This Manufacturing Technology WuXi Bio’s Track Record WuXi Bio delivered ~4 tons of COVID-19 02 neutralizing antibodies with single-use technology, demonstrating that such technology is comparable to stainless ste
Slide 35: Thriving Growth in Microbial Business
Thriving Growth in Microbial Business End-to-end One-stop Service Platform for Microbial Strain Analytical DS GMP DP GMP Analytical Process Development Development Manufacturing Manufacturing Validation Validation DS Process Formulation DP Process QC Release Process Regulatory Development Developmen
Slide 36: Strong D and Expansion for M in Microbial Business
Strong “D” and Expansion for “M” in Microbial Business D Strong development capabilities M Proprietary Expression Systems Microbial Process Development Commercial Projects Microbial Host & Plasmid Innovations Comprehensive Tool-box, Enriched Experience High throughput process development technology
Slide 37: WBS and ESG as Important Components of Business Strategy
WBS and ESG as Important Components 04 of Business Strategy
Slide 38: WuXi Biologics Business System (WBS)
WuXi Biologics Business System (WBS) launched in 2021 WuXi Biologics’ Lean Operation and Management System HIGHER QUALITY, FASTER DELIVERY, BETTER VALUE Strategic Planning Participate in or facilitate Business Culture Strategic Planning, Policy WuXi Bio Lean Culture Indicator Deployment and Business
Slide 39: WBS Achievements in 2023
WBS Achievements in 2023 Realized Benefit in 2023 Completed Kaizen Projects 370+ Revenue Increase Cost Saving Labor Efficiency Improvement Inventory Reduction 245 mm 1,000k hr 270 mm 160 mm Inventory reduced from Completed Kaizen projects Labor hours Kaizen projects Internal Material saving from Cos
Slide 40: ESG Performance Recognized as Industry Leader
ESG Performance Recognized as Industry Leader Dow Jones Sustainability World Index MSCI AAA Dow Jones Sustainability Emerging Markets Index ESG Rating of 2023 • Ranked No.1 in its sector and identified as a global • The highest rating on MSCI’s AAA (Leaders) to sustainability leader CCC (Laggards) •
Slide 41: ESG Performance Recognized as Industry Leader
ESG Performance Recognized as Industry Leader • Ranked top 1% of 100,000+ companies This is really fantastic news! • Outstanding performance across all areas: So excited to hear WuXi Bio is Environment, Labor & Human Rights, Ethics, doing an excellent job with and Sustainable Procurement EcoVadis.”
Slide 42: Financial Overview
Financial Overview 05
Slide 43: Solid Financial Performance Achieved
Solid Financial Performance Achieved Revenue Gross Profit 17,034.3 37.7% 34.6% 41.8% 43.3% 44.1% 45.6% 48.8% 50.6% 50.0% 45.3% RMB mm 15,268.7 37.1% 32.4% 39.3% 40.8% 40.2% 41.6% 45.1% 46.9% 44.0% 40.1% 6,724.0 6,827.9 RMB mm 10,290.1 4,828.9 5,612.4 3,983.7 2,533.0 2,534.5 1,658.8 989.0 1,618.8 1,0
Slide 44: Key Profit Metrics
Key Profit Metrics Net Profit Net Profit Attributable to Owners of the Company RMB mm RMB mm 4,549.9 4,420.3 3,508.6 3,570.6 3,399.7 3,388.5 1,692.7 1,688.9 1,010.3 1,013.8 630.5 630.6 42.0 44.5 141.1 252.6 42.0 44.5 141.1 252.6 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 2015 2016 2017 2
Slide 45: Gross Profit and Cost of Sales
Gross Profit and Cost of Sales Cost of Services as % of Revenue Adj. GM (%) 34.6% 41.8% 43.3% 44.1% 45.6% 48.8% 50.6% 50.0% 45.3% GM (%) 32.4% 39.3% 40.8% 40.2% 41.6% 45.1% 46.9% 44.0% 40.1% 67.6% 60.7% 59.8% 59.9% 59.2% 58.4% 56.0% 21.8% 54.9% 53.1% 17.6% 19.0% 19.2% 18.0% 14.7% 20.7% 17.4% 13.4% 2
Slide 46: Free Cash Flow Positive since 2022
Free Cash Flow Positive since 2022 CAPEX vs. Operating Cash Flow RMB bn 6.0 6.5 • Net operating cash flow recorded ~51% (1) 5.4 5.5 (1)4.7 4.1 CAGR growth from 2017 to 2023 3.2 3.4 1.8 1.9 0.7 0.4 0.8 1.2 • Free cash flow turned positive in 2022 and 2017 2018 2019 2020 2021 2022 2023 continued to im
Slide 47: Summary
Summary 06
Slide 48: CRDMO: Three Growth Curves Drive Sustainable Long-term Growth
CRDMO: Three Growth Curves Drive Sustainable Long-term Growth Three Long-Term Growth Curves R+D+M D+M D 2019 2013 2017 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 46
Slide 49: Proven CRDMO Business Model Continues to Deliver Sustainable Growth
Proven CRDMO Business Model Continues to Deliver Sustainable Growth C R • D • Cell Line Engineering M O Contract Target Selection • DS GMP Manufacturing One partner Services • Reagent/Protein Generation & Assay Development • Assay Development • DP GMP Manufacturing with • Antibody Generation • Proce
Slide 50: 2023 Highlights: Significant Progress in R, D and M
2023 Highlights: Significant Progress in R, D and M, Best in Company Record Most important reason for the 2023 slow- R: record high revenue, 110% 3-year CAGR down is 84% decrease of COVID revenue. growth for milestone and research services Overall non-COVID revenue grew 37.7% YoY revenue, blockbuste
Slide 51: 2024 Outlook
2024 Outlook R&D: Continue to expect strong growth. Strong momentum from global biotech recovery in Q4 2023 continued in Q1 2024. 25 new projects signed as of Mar 22, 2024 vs 8 in Q1 2023 M: “Follow the Molecule” projects track well. Several potential blockbuster projects move to PPQ stages which wi
Slide 52: Appendix
Appendix
Slide 53: 2023 Financial Summary
2023 Financial Summary (RMB million) 2023 2022 Change Revenue 17,034.3 15,268.7 11.6% Cost of Sales (10,206.4) (8,544.6) Gross Profit 6,827.9 6,724.0 1.5% Other Income 416.7 305.5 Impairment Losses under ECL Model, Net of Reversal (320.0) (258.5) Other Gains and Losses 36.5 766.5 Selling and Marketi
Slide 54: Reconciliation for Adjusted Net Profit and Adjusted EBITDA
Reconciliation for Adjusted Net Profit and Adjusted EBITDA (RMB million) 2023 2022 Change Adjusted Net Profit Reconciliation Net Profit 3,570.6 4,549.9 Share-based Compensation Expense 1,274.1 1,234.4 Foreign Exchange Gain (5.7) (369.2) Losses (Gains) from Equity Investments 57.8 (361.2) Listing Exp
Slide 55: WuXi Bio Vision
WuXi Bio Vision “Every drug can be made and every disease can be treated” by building an open-access platform with the most comprehensive capabilities and technologies in the global biologics industry 53 53
WuXi Biologics (Cayman) — FY2023 Earnings Presentation on 6ix