Slide 1: 2017 First-half results
16.08.2017 2017 First-half results Conference presentation for investors, analysts & media Basel, 17 August 2017 Disclaimer This presentation contains certain forward-looking statements that reflect the current views of management. Such statements are subject to known and unknown risks, uncertaintie
Slide 2: First-half highlights
16.08.2017 First-half highlights Marco Gadola, CEO Creating growth opportunities in and beyond our space REVENUE GROWTH PROFITABILITY KEY DRIVERS +14% organic1 25.7% EBIT margin Total solutions Q2: +14% organic; +16% in CHF Strong volume growth drives margin Dynamic growth in non-premium, driven by
Slide 3: Organic revenue growth 2012-2017
16.08.2017 Above-market growth driven by new products and entry into new geographies & segments Organic revenue growth 2012-2017 BLT implant Roxolid implant ‘Roxolid material for all’ ProAch edentulous solution Lab & chairside CADCAM offering 2012 2013 2014 GBR 2015 2016 2017 biomaterials Variobase
Slide 4: Further margin expansion
16.08.2017 Further margin expansion Revenue growth Underlying EBIT margin (%) Earnings per share excl. acquisition excl. exceptionals & FX effects excl. one-time effects1 and FX effects +14% +120bps +26% organic EBITDA +130pbs 25.7 7.57 24.5 543.4 475.2 5.99 2016 2017 2016 2017 2016 2017 1 2017 EPS
Slide 5: Business and regional review
16.08.2017 Business and regional review Peter Hackel, CFO Strong expansion across all regions Revenue development (CHFm, rounded) Regional share of 17.8% organic growth in CHF 14.3% organic 10% LATAM 7.0 543.4 17.1 21.9 25% 22.2 APAC 11.3 475.2 461.2 2.7 32% North Change in organic growth America 10
Slide 6: EMEA robust – North America still on fast track
16.08.2017 EMEA robust – North America still on fast track EMEA Revenue change (organic) EMEA maintained its pace in Q2 despite 56% two fewer selling days (Easter effect) 11.1% All businesses contributed to the positive 9.4% 10.1% 9.9% development; digital equipment business 45% of Group 7.7% 8.
Slide 7: Key financials at a glance
16.08.2017 Double-digit growth across all businesses Implants Restorative Biomaterials 13 Key financials at a glance H1 2017 H1 2016 Δ % / bps in CHF million (rounded) Reported Exceptionals excl. Reported Exceptionals excl. excl. Exceptionals exceptionals exceptionals Revenue 543.4 461.2 Organic gro
Slide 8: Underlying profitability improves – EBITDA up 120bps
16.08.2017 Gross margin constrained by capacity expansion and higher share of third-party products Change in % -110bps -100bps 1.6 0.1 -2.7 -0.1 -0.3 Investments in future growth • Significant increase in 78.3 manufacturing teams in 78.2 77.2 Curitiba, Andover & Villeret • Start-up costs in Curitiba
Slide 9: Leveraging sales & HQ infrastructure – EBIT +120bps
16.08.2017 Leveraging sales & HQ infrastructure – EBIT +120bps D&A in H1 H1 % of In % CHFm 2016 2017 sales +90bps Regular D&A 12.4 13.9 2.6% +120bps Amortization related to 1.8 business combinations: 0.0 Neodent 2.8 3.3 -0.3 -0.3 Medentika - 0.8 0.8% -1.0 Equinox - 0.3 0.4 Change yoy +57% 25.7 25.4
Slide 10: Free cash flow reflects investments in production, portfolio and geographic expansion
16.08.2017 Free cash flow reflects investments in production, portfolio and geographic expansion In CHF m Increased investment in production capacity at multiple sites 26.9 -19.1 50% capacity increase in Curitiba completed Additional building project in Villeret underway Specialized machiner
Slide 11: Strategic priorities of the Straumann Group
16.08.2017 Strategic priorities of the Straumann Group Drive our high performance STMN Group culture and organization Target unexploited growth markets & segments Expand scope to become a Total Solution Provider for esthetic dentistry 21 Continuously expanding our addressable market Variobase BLT Ne
Slide 12: Stepping into orthodontics
16.08.2017 Stepping into orthodontics 75% of the population have misaligned teeth Teenage & adult population1 No treatment 25% required1 15% Purely esthetic needs Rarely addressed Primary focus on mild-to- moderate malocclusion Mild to severe; may 45% require some Increasingly addressed orthodontic
Slide 13: Substitution technologies – a key to our success
16.08.2017 Global orthodontic market overview Conventional wires & Clear aligners brackets USD 0.8 bn Up to USD 1.5 bn Est. volume Cases share in % distribution in % 22 20-25 34 Teen Danaher (Ormco) Adult 3M Unitek 21 Dentsply Sirona Teen penetration is in the single-digits 24 Other 75-80 Low sing
Slide 14: The case for clear aligners
16.08.2017 The case for clear aligners Practically invisible, discreet Removable (e.g. for eating and cleaning) for up to two hours a day Costs to patient comparable to other orthodontic options; approx. USD 3500-5500 depending on application Increasing popularity among teenagers, who make u
Slide 15: Clear-aligner segment underpenetrated
16.08.2017 Clear-aligner segment underpenetrated Clear aligners vs. conventional braces & wires: Clear aligner adoption drivers worldwide cases per year North America: Clear-aligner More dentists trained (GPs & penetration ~14-18% orthodontists) More GPs offer/promote treatment Potential: Curr
Slide 16: ClearCorrect joins the Straumann Group
16.08.2017 Commonalities in restorative and clear-aligner workflows Prosthetic workflow Orthodontic workflow Digital Design treatment plan Modification & Model production Aligner production Set engagers impression and 3D simulation approval by dentist (3D printing) (thermo-foiling process) & fitting
Slide 17: Partners of choice
16.08.2017 Partners of choice • Timely entry into clear aligner field • Critical mass: a leading aligner manufacturer with a base of >15K treatment providers • Incremental growth opportunities • Expertise in orthodontics • Global distribution & marketing network • Brand leverage • Regional productio
Slide 18: Geniova complements ClearCorrect
16.08.2017 Geniova complements ClearCorrect Young dynamic company in Madrid, Spain Straumann provided a capital injection of CHF 3.2m to support Geniova’s expansion strategy in return for: o 38% stake o right to become the exclusive distributor of Geniova products Transaction completed 35 Pion
Slide 19: Digitalization – connecting everything
16.08.2017 Digitalization – connecting everything Adding the full power of Dental Wings A leading provider of digital dentistry technologies and the core of the Straumann CARES portfolio Solutions cover full digital workflow: intraoral and model scanning, implant planning, prosthesis desig
Slide 20: Creating one of the industry's most powerful digital teams
16.08.2017 Rapid Shape deal completed; Straumann P Series 3D-printers ready for launch Acquisition of 35% stake in Rapid Shape, a leader in 3D-printing technologies, completed Straumann-branded P20, P30 & P40 3D- printers integrated into CARES & Dental Wings workflows and entering limited market
Slide 21: Focus on DSOs
16.08.2017 Focus on DSOs Creating opportunities from the rise in corporate dentistry DSO MARKET SHARE DSO market growing at 20% annually GLOBAL in %1 Represents >10% of global implant market 20% 20% DSO share is projected to double by 2020 Driving implant penetration 16% Top 100 DSOs place
Slide 22: Dedicating resources to DSOs
16.08.2017 Dedicating resources to DSOs Group well positioned to lead this segment • Comprehensive premium/non-premium solutions; education, value-added services, digital equipment, orthodontic solutions, high portfolio flexibility Dental Service Organization Unit • Unified global business approac
Slide 23: A total solution provider for tooth replacement and esthetic dentistry
16.08.2017 Bringing premium & non premium together under Group brand to simplify and create selling opportunities Premium and non-premium brands brought closer together under the Straumann Group umbrella Simplification of internal processes and legal set-up Sales reps Premium and non-premium P
Slide 24: New Group set-up / Competitive landscape
16.08.2017 New Group set-up Implants & prosthetics Local/regional Premium Non-Premium Orthodontics Digital Biomaterials Other technology partners 47 Fully consolidated Associate (equity method) Partnership Competitive landscape Traditional CADCAM DVT/ Clear Surgical Intraoral CADCAM 3D wires & Bioma
Slide 25: Plenty of potential in a market worth >CHF 8 bn
16.08.2017 Plenty of potential in a market worth >CHF 8 bn CHF m CHF 3.5 bn 3000 2000 1000 0 Imaging&&planning Imaging Planing Implants Implants Abutments Abutments CADCAM- CADCAM Biomaterials Biomaterials CADCAM- CADCAM Scanners Scanners Clear ClearAligner aligners prosthetics Prosthetics equipment
Slide 26: Outlook 2017
16.08.2017 Outlook 2017 Our 2017 guidance Barring unforeseen circumstances We expect the global implant market Market growth to grow at approx. 3-4% Confident that we can continue to outperform Our revenue by achieving organic1 revenue growth in the growth low double-digit range Further improvements
Slide 27: Questions & answers
16.08.2017 Questions & answers & Calendar of upcoming events 2017 Event Location 17 August Half-year results conference Straumann Group Headquarters, Basel 21 August Investor meetings New York 22 August Investor meetings Zurich 22 August Investor meetings Boston 23 August Investor meetings Frankfurt
Slide 28: Growth strategy pays off
16.08.2017 Growth strategy pays off in CHF million 2012 2013 2014 2015 2016 H1 2017 5-year average Revenue 686.3 679.9 710.3 798.6 917.5 543.4 Organic revenue growth in % -1.0 1.2 6.4 9.1 13.1 14.3 8.8 Acquisiton / Divesture effect in % -0.6 -0.8 0.0 9.5 0.8 2.8 2.5 Change in l.c.% -1.6 0.4 6.4 18.6
Slide 29: Overview of the orthodontics market
16.08.2017 Overview of the orthodontics market Braces & brackets1 Other Metal Consumables brackets & wires Conventional Instruments Ceramic/polymer Esthetic solutions Acceleration devices Lingual2 Retention device Aligners Clear aligners Ortho and CAD software Scanners & services