Dri Healthcare Trust · TSX:DHT.U
Dri Healthcare Trust — Q3 2023 Earnings Presentation
21 slides from Dri Healthcare Trust's earnings presentation, Nov 14, 2023
Slide 1: Advancing Science in the Fast-Growing Pharmaceutical and Biotechnology Sector
ADVANCING SCIENCE in the Fast-Growing Pharmaceutical and Biotechnology Sector Q3 2023 Earnings Call | November 14, 2023
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by DRI Healthcare Trust (the “Trust”). The Trust is an unincorporated open-ended fund trust governed by the laws of the Province of Ontario, Canada and is externally managed by DRI Capital Inc. (“DRI Capital” or the “Manager” and together with the Trust
Slide 3: Q3 highlights
Q3 highlights 1 Accretive 2 Significant 3 Returning value transactions capacity for to unitholders • Additional Vonjo growth • Quarterly royalty stream for • Completed two distribution of $66 million public offerings for $0.075 per unit • Additional gross proceeds of Orserdu royalty $151 million str
Slide 4: Q3 financial highlights
Q3 financial highlights Normalized Total Cash Total Income Adjusted EBITDA1 Receipts1 $34.1 million $20.3 million $25.2 million +29% over Q3 2022 +28% over Q3 2022 +34% over Q3 2022 Adjusted EBITDA Margin1 Adjusted Cash Earnings per Declared Cash Distributions Unit1 per Unit 80% $0.46 $0.0750 1. Nor
Slide 5: Post quarter-end highlights
Post quarter-end highlights Deployment Capacity Dividend Declaration Unitholder Value Credit facility Quarterly cash distribution Normal course issuer bid • Increased total credit • Declared a distribution of • Granted approval by the TSX available from credit facility $0.075 per unit for Q4 2023 to
Slide 6: Portfolio performance as of September 30, 2023
Portfolio performance as of September 30, 2023 (US$ thousands) Primary Total Cash Royalty Receipts1 Therapeutic Area Marketer(s) Q3 2023 Q3 2022 % Change Remarks Total Cash Royalty Receipts1 $25,249 $17,504 44% Oncology 3,453 - n/a New product – acquired in Q2/2023 & Q3/2023 Hematology 3,112 1,184 1
Slide 7: Investment Highlights
Investment Highlights The longest standing and a global leader in buying healthcare royalties Well positioned to capitalize on generational industry growth delivering attractive uncorrelated cash flows Diversified portfolio of products by therapeutic area and marketer High yield and high margin valu
Slide 8: Our competitive advantages
Our competitive advantages 1 Seasoned 2 Disciplined 3 Proactive 4 Strong team capital sourcing execution of specialized allocation proprietary fundamental investment based on robust database tracking ground-up professionals with investment criteria royalties on more diligence on life science that ha
Slide 9: Positive effect of compounding of cash flows
Positive effect of compounding of cash flows New asset Total Cash acquisitions Receipts1 Cash for Adjusted redeployment EBITDA1 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 2 Cumulative effect of compounding Annual CF without compounding Annual CF with compounding Virtuous
Slide 10: Long-term drivers support market growth
Long-term drivers support market growth Growth of Biopharma Projected Growth of Worldwide Projected Growth of Worldwide clinical pipeline1 Biopharma R&D Spend ($B)2 Medicine Spending ($B)3 +49% +17% +27% 6,147 278 1,967 238 1,574 4,126 2017 2022 2022 2027E 2022 2027E • Genomics • Pace of innovation
Slide 11: State of the biotech market
State of the biotech market Biotech IPOs1 Biotech Equities Performance2 16 120 140 130 14 13% 100 120 12 110 80 Total Proceeds ($B) 10 100 -21% Number of IPOs 90 8 60 80 6 70 40 -53% 4 60 20 50 2 40 Aug-21 Oct-21 Aug-22 Oct-22 Aug-23 Oct-23 Jan-21 Feb-21 Jan-22 Feb-22 Jan-23 Feb-23 Mar-21 Apr-21 Mar
Slide 12: Royalty transaction activity is expanding with strong industry tailwinds
Royalty transaction activity is expanding with strong industry tailwinds Trailing three-year average number of transactions1 Trailing three-year average value of transactions ($B)1 40 7 35 6 30 5 25 4 20 3 15 2 10 5 1 0 0 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 Aggregate royalty
Slide 13: Delivering on our long-term objectives
Delivering on our long-term objectives Guidance at IPO Guidance Today (Feb 2021) Initial target of Raised deployment target to Capital deployment target $650 – 750 million over 5 years $850 – 900 million over 5 years Mid-teens total income CAGR through 2025 Declining cash curve due to expected asset
Slide 14: Current deployment exceeds targets
Current deployment exceeds targets 14-Aug-23 ($M) 900 25-Jul-23 800 Additional milestones 29-Jun-23 Actual deployment 700 8-Mar-232 25-Nov-22 600 500 30-Sep-22 400 9-Sep-22 300 30-Sep-21 28-Feb-22 20-Jul-221 200 25-Aug-21 100 0 Feb-21 May-21 Aug-21 Nov-21 Feb-22 May-22 Aug-22 Nov-22 Feb-23 May-23 Au
Slide 15: Orserdu royalty transactions
Orserdu royalty transactions TRANSACTION HIGHLIGHTS STRONG GROWTH POTENTIAL Orserdu I $85 million up front purchase price Approved by the FDA in January Mid single digit tiered royalty on 2023 and the EMA in September worldwide net sales 2023 Orserdu II Significant PFS benefit over SOC in $130 milli
Slide 16: Vonjo II royalty transaction
Vonjo II royalty transaction TRANSACTION HIGHLIGHTS STRONG GROWTH POTENTIAL $66 million purchase price for tiered First year of sales strongly exceeded royalty on worldwide net sales analyst consensus estimates Approved by the FDA in $6.5 million payment made to CTI February 2022 as the only in Janu
Slide 17: Robust pipeline
Robust pipeline $3.0 billion in near-term opportunities Address important Provides strong Marketed by leading unmet needs with life- intellectual property biotech or biopharma changing therapies for and regulatory companies patients protection Further portfolio diversification and extension with att
Slide 18: Well capitalized for growth
Well capitalized for growth $28.2 million1 Cash and cash equivalents Significant $40.9 million2 capacity for Royalties receivable further growth $351.7 million3 Available from credit facilities Enhancing capital structure builds a foundation for further growth 1. As at September 30, 2023. 2. Include
Slide 19: Strong cash generation
Strong cash generation Adjusted EBITDA for the Last Twelve Months Ended September 30, 2023 ($M)1 $8.6 $113.1 ($1.8) ($1.2) $110.1 ($8.7) $104.5 ($7.3) $94.1 Adjusted EBITDA Margin1 86% Adjusted Cash Earnings per Unit1,5 Royalty Income Total Interest and Other Total Income Net Change in Royalties Non
Slide 20: Our key priorities
Our key priorities Invest in our people and build the industry leading royalty investment team People Execute on strong pipeline and operate at Execution peak performance in all aspects of our business Results Focus on long-term, sustainable growth generating strong unitholder returns 20
Slide 21: Contact Us
Contact Us David Levine ir@drihealthcare.com