Viatris Inc. · NASDAQ:VTRS
Viatris — Q2 2022 Earnings Presentation
44 slides from Viatris's earnings presentation, Aug 8, 2022
Slide 1: Q2 2022 Earnings
Q2 2022 Earnings August 8, 2022 This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Via
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking statements”. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, 2022 financial guidance; that
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures Key References New product sales, new product launches or new product revenues refer to revenue from new products launched in 2022 and the carryover impact of new products, including business development, launched within the last 12 months. Operational change refers to co
Slide 4: Q2 2022 – Focused Execution & Results
Q2 2022 – Focused Execution & Results Simpler, Stronger, More Focused • Strong quarterly performance Business • Total Revenues $4.12B Performance • Adjusted EBITDA $1.48B & Execution • Free Cash Flow $719M Delivering • On track to deliver new product revenues of ~$600M for 2022 the Pipeline • Expect
Slide 5: Segment Results
Segment Results This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris company. 5
Slide 6: Total Net Sales
Total Net Sales OPERATIONAL HIGHLIGHTS ($M) Q2 2022 Q2 2021 Change Op Change Q2 Performance vs. Expectations Net Sales $4,105 $4,562 (10%) (3%) • Strong performance across all our segments Brands 2,483 2,702 (8%) (1%) • Brands: better than expectations driven by brands such as Norvasc®, Lipitor®, an
Slide 7: Developed Markets
Developed Markets OPERATIONAL HIGHLIGHTS ($M) Q2 2022 Q2 2021 Change Op Change Q2 Performance vs. Expectations Net Sales $2,479 $2,640 (6%) 1% • Europe net sales of $1.4B Brands 1,305 1,424 (8%) 0% • North America net sales of $1.1B Complex Gx & Biosimilars 327 309 6% 9% • Brands: better than expect
Slide 8: Emerging Markets
Emerging Markets OPERATIONAL HIGHLIGHTS ($M) Q2 2022 Q2 2021 Change Op Change Q2 Performance vs. Expectations Net Sales $651 $870 (25%) (19%) (1) • Brands: in line with expectations driven by higher volumes in key markets like South Korea, Brazil and Malaysia, Brands 388 433 (10%) (2%) including pro
Slide 9: JANZ
JANZ OPERATIONAL HIGHLIGHTS ($M) Q2 2022 Q2 2021 Change Op Change Q2 Performance vs. Expectations Net Sales $427 $501 (15%) (2%) • Brands: better than expectations, primarily driven by LOE portfolio, including Lyrica® and Celebrex® Brands 243 295 (18%) (4%) • Complex Gx & Biosimilars: in line with e
Slide 10: Greater China
Greater China OPERATIONAL HIGHLIGHTS ($M) Q2 2022 Q2 2021 Change Op Change Q2 Performance vs. Expectations Net Sales $548 $550 0% 1% • Overall results better than expectations, while navigating the evolving environment Brands 546 549 (1%) 0% Complex Gx & Biosimilars 0 0 NM NM 2022 Full-Year Expectat
Slide 11: Pipeline
Pipeline This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris company. 11
Slide 12: Novel and Life-Cycle Management Products in the Pipeline
Novel and Life-Cycle Management Products in the Pipeline Actual / Projected Launch Year(1) Lead Product Status Markets 2021 2022 2023 2024 2025 2026 Levothyroxine OS US Approved US In Development Glatiramer Once Monthly EU In Development Yupelri (PIFR)(2) US In Development Study Completion Xulane Lo
Slide 13: Integrate & Synergize
Integrate & Synergize This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris compa
Slide 14: On Track to Realize $1B+ of Cost Synergies By End of 2023
On Track to Realize $1B+ of Cost Synergies By End of 2023 2021 2022 2023 Close / Divest Manufacturing Sites COGS Execute Procurement & COGS Optimization SG&A Optimize / Reduce Overlapping Infrastructure TSAs Exit Pfizer TSAs (Finance, IT, HR, Operations, etc.) Achieved Expected Annual Savings ~$500M
Slide 15: Q2 Financial Highlights
Q2 Financial Highlights This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris com
Slide 16: Q2 2022 Financial Highlights
Q2 2022 Financial Highlights ($M) Q2 2022 Q2 2021 CHANGE OP CHANGE Total Net Sales $4,105 $4,562 (10%) (3%) Developed Markets 2,479 2,640 (6%) 1% Emerging Markets 651 870 (25%) (19%) JANZ 427 501 (15%) (2%) Greater China 548 550 0% 1% Other Revenues 11 16 NM NM Total Revenues $4,117 $4,578 (10%) (3%
Slide 17: H1 2022 Financial Highlights
H1 2022 Financial Highlights ($M) H1 2022 H1 2021 CHANGE OP CHANGE Total Net Sales $8,284 $8,962 (8%) (2%) Developed Markets 4,955 5,212 (5%) 0% Emerging Markets 1,356 1,625 (17%) (10%) JANZ 851 983 (13%) (3%) Greater China 1,121 1,142 (2%) (2%) Other Revenues 25 46 NM NM Total Revenues $8,309 $9,00
Slide 18: Q2 2022 Total Net Sales and Adjusted EBITDA Walk
Q2 2022 Total Net Sales and Adjusted EBITDA Walk Net Sales ($M) 4,562 306 4,256 71 4,105 164 84 Q2 2021 Fx Q2 2021 at Competition on Other Base New Product Q2 2022 2022 Fx Rates Key US Products Business Erosion Net Sales Adjusted EBITDA ($M) 1,675 96 1,579 70 1,482 82 44 11 Q2 2021 Fx Q2 2021 at Com
Slide 19: Q2 2022 Free Cash Flow
Q2 2022 Free Cash Flow ($M) Q2 2022 Q2 2021 CHANGE Q2 2022 Drivers vs. Q2 2021 U.S. GAAP Net Cash Provided • Positive Change in Working Capital $803 $559 43% by Operating Activities • Reduced One-Time Cash Costs Capital Expenditures (84) (89) (6%) • Cash Optimization Initiatives Free Cash Flow $719
Slide 20: Capital Allocation – Delivering on our Financial Commitments
Capital Allocation – Delivering on our Financial Commitments >$4.3B Free Cash Flow over last 6 quarters • ~$1.5B in Debt Repayment in H1 2022 Debt • >$3.5B in Debt Repayment since the $1,074M Repayment beginning of 2021 $965M • Committed to Investment Grade Rating $799M $719M $470M $326M • $0.12 Div
Slide 21: 2022 Financial Guidance
2022 Financial Guidance This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris com
Slide 22: Significant Dollar Strengthening against Major Currencies
Significant Dollar Strengthening against Major Currencies Q2 2021 $1.21 EUR Spot Rates Q2 2022 Developments $1.25 • Dollar has strengthened across major currencies, including key exposures: Q1 2022 Q2 2022 EUR, JPY, KRW, GBP, RMB $1.20 $1.12 $1.06 • ~45% of Fx exposure related to EUR given size of b
Slide 23: 2022 Financial Guidance Update
2022 Financial Guidance Update Revised Revenue Guidance Key Commentary ($B) Previous Guidance Fx Impact Current Guidance • Strong H1 2022 operational revenue performance in line with expectations, and full year operationally in line with previous guidance Total Revenues (1) $17.0 - $17.5 (~$0.8) $16
Slide 24: GAAP/Non-GAAP Reconciliations
GAAP/Non-GAAP Reconciliations This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatr
Slide 25: Full-Year 2022 Guidance Items
Viatris Inc. and Subsidiaries Full-Year 2022 Guidance Items (Unaudited; in millions) GAAP Non-GAAP Total Revenues $16,200 - $16,700 N/A Adjusted EBITDA N/A $5,800 - $6,200 Net Cash provided by $3,100 - $3,300 N/A Operating Activities Free Cash Flow N/A $2,500 - $2,900 This document contains propriet
Slide 26: Reconciliation of Estimated 2022 Net Cash from Operations to Free Cash Flow
Viatris Inc. and Subsidiaries Reconciliation of Estimated 2022 U.S. GAAP Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited; in millions) Previous Guidance Current Guidance Estimated U.S. GAAP Net Cash provided by Operating Activities $3,200 - $3,400 $3,100 - $3,300 Less: Capital
Slide 27: Adjusted Net Earnings
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Adjusted Net Earnings Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP net earnings (loss)........................................................................
Slide 28: Net Earnings (Loss) to Adjusted EBITDA
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Net Earnings (Loss) to Adjusted EBITDA Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP net earnings (loss).......................................................
Slide 29: Summary of Total Revenues by Segment
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s) Summary of Total Revenues by Segment Three Months Ended Six Months Ended June 30, June 30, 2022 Constant Constant 2022 Constant Constant 2022 Currency Currency Currency % 2022 Currency C
Slide 30: Cost of Sales
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s) Cost of Sales Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP cost of sales.............................................................. $ 2,413.5 $
Slide 31: R&D
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s) R&D Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP R&D................................................................ $ 162.6 $ 147.7 $ 304.9 $ 331.
Slide 32: SG&A
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s) SG&A Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP SG&A.................................................................................... $ 981.1
Slide 33: Total Operating Expenses
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Total Operating Expenses Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP total operating expenses.................................................... $ 1,154.6 $
Slide 34: Interest Expense
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Interest Expense Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP interest expense.................................................................. $ 145.9 $ 167
Slide 35: Other Expense (Income), Net
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Other Expense (Income), Net Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP other expense, net................................................... $ 13.5 $ 4.2 $
Slide 36: Earnings Before Income Taxes and Income Tax Provision
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s) Earnings Before Income Taxes and Income Tax Provision Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 U.S. GAAP earnings (loss) before income taxes.............
Slide 37: Gross Leverage - Debt to Adjusted EBITDA
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except ratio) Gross Leverage - Debt to Adjusted EBITDA Gross Leverage Ratio is the ratio of Viatris’ total debt at notional amounts at June 30, 2022 to the sum of Viatris’ adjusted EBITDA for the q
Slide 38: Net Earnings (Loss) to Adjusted EBITDA
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Net Earnings (Loss) to Adjusted EBITDA Three Months Ended September 30, 2021 December 31, 2021 March 31, 2022 June 30, 2022 U.S. GAAP net earnings (loss)............................................
Slide 39: Gross Leverage - Debt to Adjusted EBITDA - Q4 2020
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except ratio) Gross Leverage - Debt to Adjusted EBITDA - Q4 2020 Twelve Months Ended December 31, 2020 Combined Adjusted EBITDA $ 6,807.2 Reported debt balances: Long-term debt, including current p
Slide 40: Net Earnings (Loss) to Combined Adjusted EBITDA - Q4 2020
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Net Earnings (Loss) to Combined Adjusted EBITDA - Q4 2020 Twelve months ended December 31, 2020 U.S. GAAP net loss...................................................................................
Slide 41: Free Cash Flow over the Last 6 Quarters
Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions) Free Cash Flow over the Last 6 Quarters Free Cash Flow over Three Months Ended the last 6 quarters March 31, 2021 June 30, 2021 September 30, 2021 December 31, 2021 March 31, 2022 June 30, 2022 Jun
Slide 42: Appendix
Appendix This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2022 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris company. 42
Slide 43: Q2 2022 Select Key Product Net Sales, on a Consolidated Basis
Q2 2022 Select Key Product Net Sales, on a Consolidated Basis (Unaudited; in millions) ($M) Q2 2022 Q2 2022 YTD ($M) Q2 2022 Q2 2022 YTD Select Key Global Products Select Key Segment Products Lipitor® $405.6 $845.7 Dymista® $55.5 $99.4 Norvasc® 203.0 410.8 Yupelri® 49.1 92.7 Lyrica® 155.8 327.4 Amit
Slide 44: Key Metrics Utilized for Financial Guidance
Key Metrics Utilized for Financial Guidance Previous Ranges Current Ranges Adjusted Gross Margin 57.5 - 58.5% 58.0 - 59.0% Adjusted SG&A % of Total Revenue 20.5 - 21.5% 20.5 - 21.5% Adjusted R&D % of Total Revenue 3.9 - 4.3% 3.9 - 4.3% Net Cash Provided by Operating Activities $3.2B - $3.4B $3.1B -