Slide 1: Alcon, Inc. Worldwide Leader in Ophthalmic Research and Manufacturing
oS Alcon, Inc. Worldwide Leader in Ophthalmic Research and Manufacturing TRAVATAN. en om
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements contained in this presentation that are forward-looking are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. This presentation is being made on July 29, 2004, and Alcon does not undertake
Slide 3: Management Presentation by
Management Presentation by Tim Sear Chairman, President & CEO Jacqualyn Fouse Senior Vice President of Finance & CFO 3
Slide 4: Financial Results
Financial Results (For the quarters and six months ended June 30, 2004 and 2003) 4
Slide 5: Second Quarter Financial Highlights
Second Quarter Financial Highlights Q2 04 Q2 03 Growth Global Sales $ 1,039.2 $ 925.4 12.3% Net Earnings $ 299.2 $ 178.2 67.9% Adjusted Net Earnings $ 241.6 $ 178.2 35.6% Reported EPS* $ 0.96 $ 0.57 68.4% Adjusted EPS* $ 0.78 $ 0.57 36.8% *Diluted earnings per share for both reported and adjusted. (
Slide 6: June YTD Financial Highlights
June YTD Financial Highlights YTD 04 YTD 03 Growth Global Sales $ 2,002.8 $ 1,732.5 15.6% Net Earnings $ 490.2 $ 308.4 58.9% Adjusted Net Earnings $ 432.6 $ 308.4 40.3% Reported EPS* $ 1.58 $ 1.00 58.0% Adjusted EPS* $ 1.39 $ 1.00 39.0% *Diluted earnings per share for both reported and adjusted. (do
Slide 7: Reported vs. Adjusted Net Earnings
Reported vs. Adjusted Net Earnings Q2 04 Q2 03 YTD 04 YTD 03 Reported Net Earnings $ 299.2 $ 178.2 $ 490.2 $ 308.4 Tax Settlements and Credits (57.6) -- (57.6) -- Adjusted Net Earnings* $ 241.6 $ 178.2 $ 432.6 $ 308.4 *Adjusted net earnings help investors better compare results of operations from 20
Slide 8: Reported vs. Adjusted Earnings Per Share
Reported vs. Adjusted Earnings Per Share Q2 04 Q2 03 YTD 04 YTD 03 Reported Diluted EPS $ 0.96 $ 0.57 $ 1.58 $ 1.00 Tax Settlements and Credits (0.18) -- (0.19) -- Adjusted Diluted EPS* $ 0.78 $ 0.57 $ 1.39 $ 1.00 *Adjusted diluted EPS help investors better compare results of operations from 2004 an
Slide 9: Second Quarter Income Statement Detail
Second Quarter Income Statement Detail % of % of Q2 04 Sales Q2 03 Sales Gross Profit $ 765.0 73.6% $ 658.3 71.1% SG & A $ 312.3 30.1% $ 291.1 31.5% Research & Development $ 89.3 8.6% $ 89.3 9.6% (dollars in millions) 9
Slide 10: June YTD Income Statement Detail
June YTD Income Statement Detail % of % of YTD 04 Sales YTD 03 Sales Gross Profit $1,438.8 71.8% $1,212.1 70.0% SG & A $ 603.1 30.1% $ 555.3 32.1% Research & Development $ 180.2 9.0% $ 167.5 9.7% Effective Tax Rate* 30.0% 30.4% *Excludes the impact of tax settlements and tax credits of $57.6 million
Slide 11: Balance Sheet Highlights
Balance Sheet Highlights 6/30/04 12/31/03 Short and Long Term Borrowings $ 1,165.9 $ 1,410.3 Cash and Cash Equivalents $ 844.2 $ 1,086.0 Consolidated S/H Equity $ 1,713.4 $ 1,591.5 A/R Change (From 12/31/03) 28.6% N/A Inventory Change (From 12/31/03) (7.3%) N/A (dollars in millions) 11
Slide 12: Geographic and Product Line Sales
Geographic and Product Line Sales 12
Slide 13: Geographic Sales Breakdown
Geographic Sales Breakdown YTD 2004 YTD 2003 27.8% 26.1% 51.7% 54.1% 7.5% 7.3% 13.0% 12.5% United States United States Europe Europe Japan Japan Rest of World Rest of World 13
Slide 14: Global Product Line Sales
Global Product Line Sales YTD 2004 YTD 2003 40.1% 40.9% 14.9% 45.1% 14.0% 45.0% Surgical Surgical Pharmaceutical Pharmaceutical Consumer Consumer 14
Slide 15: Pharmaceutical Sales
Pharmaceutical Sales $1,000 + 18.0% $800 $819.6 $600 $694.8 + 12.3% $400 $392.2 $440.5 $200 $0 Q2 2003 Q2 2004 YTD 2003 YTD 2004 (dollars in millions) 15
Slide 16: Surgical Sales
Surgical Sales $1,000 + 15.9% $800 $903.0 $778.8 $600 + 14.2% $400 $459.1 $401.9 $200 $0 Q2 2003 Q2 2004 YTD 2003 YTD 2004 (dollars in millions) 16
Slide 17: Consumer Products Sales
Consumer Products Sales $300 + 8.2% $280.2 $258.9 $200 + 6.3% $100 $131.3 $139.6 $0 Q2 2003 Q2 2004 YTD 2003 YTD 2004 (dollars in millions) 17
Slide 18: Vigamox Conversion Trend
Vigamox Conversion Trend % of Fluoroquinolone All Prescribers Franchise 100% 80% 60% 63% 61% 40% 56% 59% 52% 49% 49% 20% 0% Nov-03 Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Vigamox™ Ciloxan® (US conversion trend for Vigamox™ and Ciloxan®) 18
Slide 19: Vigamox Share Performance
Vigamox Share Performance Vigamox™ All Prescribers Franchise Share Share 18 25 16 24.5 14 15.5 12 20 10 19.6 8 6 15 4 Vigamox™ Franchise 2 0.3 0 10 May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- 03 03 03 03 03 03 03 03 04 04 04 04 04 (US market share for Vigamox™ and Alcon total b
Slide 20: Branded Otic Franchise Share Performance
Branded Otic Franchise Share Performance Market Share % All Prescribers 28 24.3 26.7 24 21.8 20 20.4 19.4 17.9 16 12 Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Rolling 12 2003 Rolling 12 2004 (US market share for CiproDex and Cipro HC combined) 20
Slide 21: AcrySof Natural Conversion Trend
AcrySof® Natural Conversion Trend % of AcrySof® Franchise U.S. - Units 100% 80% 60% 40% 20% 32% 33% 27% 29% 22% 24% 20% 0% Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Natural Conventional 21
Slide 22: U.S. - AcrySof Share Performance
U.S. - AcrySof Share Performance® Market Share % 55 50 50.7 48.6 45 45.6 40 42.3 40.0 35 2000 2001 2002 2003 Q1 2004 (From industry and internal estimates) 22
Slide 23: 2004 Outlook
2004 Outlook Alcon 2;
Slide 24: 2004 Full Year Financial Guidance: Sales
2004 Full Year Financial Guidance • Sales range from $3.80 to $3.85 billion – Healthy global growth across major product lines – Share gains from recent product launches – Less currency benefit – Ciloxan® expiration 24
Slide 25: 2004 Full Year Financial Guidance: EPS
2004 Full Year Financial Guidance • EPS range from $2.43* to $2.46* – Mix improvement from new products – Leveraging operating infrastructure – Increased promotional and R&D activity – Ciloxan® expiration *Excludes impact of tax benefits realized in Q2 2004. 25
Slide 26: Reported vs. Adjusted Earnings Guidance
Reported vs. Adjusted Earnings Guidance Lower Higher EPS Guidance - Reported Basis $ 2.62 $ 2.65 Tax Settlements and Credits (0.19) (0.19) EPS Guidance – Adjusted Basis* $ 2.43 $ 2.46 *Adjusted EPS guidance help investors better compare results of operations from 2004 and 2003. 26
Slide 27: Alcon, Inc.
Alcon, Inc. \X/orldwide Leader y in Ophthalmic Beseayen and Manufacturing