Takeda Pharmaceutical Co. Ltd. · TSE:4502
Takeda Pharmaceutical — FY2019 Earnings Presentation
33 slides from Takeda Pharmaceutical's earnings presentation, May 13, 2020
Slide 1: Delivering Transformational Progress in FY2019
Delivering Transformational Progress in FY2019 Takeda Expresses Confidence in 2020 Growth Momentum and Commitment to Patient and Societal Needs May 13, 2020
Slide 2: Important Notice
IMPORTANT NOTICE For the purposes of this notice, “presentation” means this document, any oral presentation, any question and answer session and any written or oral material discussed or distributed by Takeda Pharmaceutical Company Limited (“Takeda”) regarding this presentation. This presentation (i
Slide 3: Agenda
01. We Are One Takeda 02. 2019 Progress and Achievements AGENDA Next Wave of Growth with Strong 03. R&D Pipeline Confidence and Growth 04. Momentum for 2020 and Beyond 3
Slide 4: We Are One Takeda
We Are One Takeda 01. 02. 03. 04. We are One 2019 Progress and Next Wave of Growth Confidence and Takeda Achievements with Strong R&D Growth Momentum Pipeline for 2020 and Beyond 4
Slide 5: Key Takeaways: Transformational Progress in FY2019
We Are One Takeda KEY TAKEAWAYS: TRANSFORMATIONAL PROGRESS IN FY2019 ONE TAKEDA PATIENT IMPACT FUTURE GROWTH One company with 5 key Wave 1 and Wave 2 R&D Momentum heading into business areas, 14 global pipeline focused on life- FY2020, medium-term brands, and integration changing medicines, priority
Slide 6: Transformation to Top 10 Global R&D-Driven Biopharma Company
We Are One Takeda TRANSFORMATION TO TOP 10 GLOBAL R&D-DRIVEN BIOPHARMA COMPANY Accelerating Growth & Patient Impact We Are One Next 5 Years Takeda TRANSFORM SCIENCE INTO LIFE-CHANGING MEDICINES Strategic Today WAVE 1 AND WAVE 2 PIPELINE Evolution VALUES BASED, R&D-DRIVEN GLOBAL GROWTH OPPORTUNITIES
Slide 7: COVID-19: Collaborating to Get Help to Patients as Fast as Possible
We Are One Takeda COVID-19: COLLABORATING TO GET HELP TO PATIENTS AS FAST AS POSSIBLE Potential treatment for high-risk patients highlights value and importance of Takeda’s plasma derived therapy platform WHAT WE’VE DONE § Initiated development of a plasma-derived hyperimmune globulin (H-Ig) with th
Slide 8: Decisive Action to Support Employees, Patients and Health Systems
We Are One Takeda DECISIVE ACTION TO SUPPORT EMPLOYEES, PATIENTS AND HEALTH SYSTEMS Takeda has demonstrated commitment to the safety of its people through early decisive action on COVID-19 to safeguard employees and their families, and reducing impact on the healthcare system 7 March Supply continui
Slide 9: 2019 Progress and Achievements
2019 Progress and Achievements 01. 02. 03. 04. We are One 2019 Progress and Next Wave of Growth Confidence and Takeda Achievements with Strong R&D Growth Momentum Pipeline for 2020 and Beyond 9
Slide 10: Solid FY2019 Results
2019 Progress and Achievements SOLID FY2019 RESULTS n Reported revenue up 57% to JPY 3,291B in first full year following Shire integration n Reported Op Profit exceeds initial guidance at JPY 100B, strong FY20 growth outlook n Core Op Profit up 110% to JPY 962B, Underlying Core OP margin of 28.9% (+
Slide 11: 5 Key Business Areas Represent ~79% of FY2019 Revenue; Growth +6%
2019 Progress and Achievements 5 KEY BUSINESS AREAS REPRESENT ~79% OF FY2019 REVENUE; GROWTH +6% RARE DISEASES PLASMA-DERIVED % of Sales: 20% THERAPIES (PDT) OTHER Growth: -5% % of Sales: 21% GI ONCOLOGY NEUROSCIENCE Growth: -12% % of Sales: 21% RARE METABOLIC RARE HEMATOLOGY HEREDITARY ANGIOEDEMA P
Slide 12: Geographic Footprint Aligns with Global Pharma Opportunities
2019 Progress and Achievements GEOGRAPHIC FOOTPRINT ALIGNS WITH GLOBAL PHARMA OPPORTUNITIES Takeda FY2019 revenues by key region Global pharma industry est. 2020 sales 48% 20% 49% 28% U.S. EUROPE & CANADA U.S. ROW 18% JAPAN 14% G ROW T H & EM ERG IN G 9% 14% M ARK ET S 14% JAPAN EU SOURCE: EvaluateP
Slide 13: Divestitures, Deleveraging and Driving Down Costs
2019 Progress and Achievements DIVESTITURES, DELEVERAGING AND DRIVING DOWN COSTS FY2018 baseline FY2019 progress Target DIVESTMENTS $10bn ~$7.7bn $10bn TARGET SET IN 5 ANNOUNCED DEALS NON-CORE ASSET SALES VALUED UP TO THIS TOTAL DELEVERAGING 4.7x 3.8x 2x 1 1 NET DEBT/ADJ. EBITDA 1 NET DEBT/ADJ. EBIT
Slide 14: Innovation + Integration = Industry Top-Tier Margin Potential
2019 Progress and Achievements INNOVATION + INTEGRATION = INDUSTRY TOP-TIER MARGIN POTENTIAL Sustained launches of new medicines, integration synergies to lower the cost base, increased U.S. scale all add up to industry-leading margin potential over medium term UNDERLYING CORE OPERATING PROFIT 1 MAR
Slide 15: Next Wave of Growth with Strong R&D Pipeline
Next Wave of Growth with Strong R&D Pipeline 01. 02. 03. 04. We are One 2019 Progress and Next Wave of Growth Confidence and Takeda Achievements with Strong R&D Growth Momentum Pipeline for 2020 and Beyond 15
Slide 16: Translating Science into Life-Changing Medicines
Next Wave of Growth with Strong R&D Pipeline TRANSLATING SCIENCE INTO LIFE-CHANGING MEDICINES THAT MAKE A CRITICAL DIFFERENCE TO PATIENTS 12 WAVE ONE 4 BEST-IN-CLASS / FIRST-IN-CLASS NMES WITH THERAPEUTIC AREAS FOCUSED ON POTENTIAL FOR >$10B AGGREGATE PEAK CRITICAL PATIENT NEEDS SALES, POTENTIAL APP
Slide 17: Following Through on FY2019 Commitments and Planning for Wave 1 Growth
Next Wave of Growth with Strong R&D Pipeline FOLLOWING THROUGH ON OUR FY2019 COMMITMENTS AND PLANNING FOR ROBUST WAVE 1 NEAR-TERM GROWTH Potential NME Approval Potential Global Brand Extension TAK-609 Hunter CNS (IT) Potential Regional Brand Extension TAK-003 Dengue vaccine Hematologic TAK-007 malig
Slide 18: Confidence and Growth Momentum for 2020 and Beyond
Confidence and Growth Momentum for 2020 and Beyond 01. 02. 03. 04. We are One 2019 Progress and Next Wave of Growth Confidence and Takeda Achievements with Strong R&D Growth Momentum Pipeline for 2020 and Beyond 18
Slide 19: Growth Momentum Expected to Continue in FY2020
Confidence and Growth Momentum for 2020 and Beyond GROWTH MOMENTUM EXPECTED TO CONTINUE IN FY2020 FY2019 FY2020 UNDERLYING3 (BN YEN) RESULTS FORECAST (MANAGEMENT GUIDANCE) REVENUE 3,291.2 3,250.0 Low-single-digit growth REPORTED OPERATING PROFIT 100.4 355.0 CORE OPERATING PROFIT1 962.2 984.0 High-si
Slide 20: FY2020 Priorities: Deliver Patient Impact and Shareholder Value
Confidence and Growth Momentum for 2020 and Beyond FY2020 PRIORITIES: DELIVER PATIENT IMPACT AND SHAREHOLDER VALUE LIFE-CHANGING GROWTH AND SHAREHOLDER IMPACT MARGIN POTENTIAL VALUE Achieve important R&D Grow 5 key business areas Growth momentum with Wave 1 pipeline milestones and prepare new launch
Slide 21: Appendix
21 APPENDIX Takeda Pharmaceutical Company Limited
Slide 22: Glossary of Abbreviations
GLOSSARY OF ABBREVIATIONS AML acute myeloid leukemia L-ASA low dose aspirin ARD acid-related diseases MLD metachromatic leukodystrophy CD Crohn's disease MM multiple myeloma CHAWI congenital hemophilia A with inhibitors NME new molecular entity CML chronic myeloid leukemia NSCLC non-small cell lung
Slide 23: Takeda's Disclosure Metrics (Definitions Unchanged)
TAKEDA’S DISCLOSURE METRICS (DEFINITIONS UNCHANGED) “REPORTED” “CORE” “UNDERLYING” Financial results recorded and From Reported Results, adjust for: From Core Results, further adjust prepared in accordance with 1. Amortization and impairment for: International Financial Reporting expenses for intang
Slide 24: Definition of Core and Underlying Growth
DEFINITION OF CORE AND UNDERLYING GROWTH Takeda uses the concept of Underlying Growth for internal planning and performance impairment losses on acquired intangible assets and other items unrelated to Takeda’s evaluation purposes. core operations, such as purchase accounting effects and transaction
Slide 25: Definition of EBITDA/Adjusted EBITDA
DEFINITION OF EBITDA/ADJUSTED EBITDA We present EBITDA and Adjusted EBITDA because we believe that these measures are IFRS measures as the primary means of evaluating our performance, value and useful to investors as they are frequently used by securities analysts, investors and other prospects for
Slide 26: Reconciliation from Reported to Core/Underlying Core FY2014 Full Year
RECONCILIATION FROM REPORTED TO CORE/UNDERLYING CORE FY2014 FULL YEAR billion yen FY2013 FY2014 Growth Revenue 1,691.7 1,777.8 + 5.1% Fx effects 6.0 (40.0) Divestments (22.1) (16.0) Underlying Growth Underlying Revenue 1,675.7 1,721.9 + 2.8% Operating profit 139.3 -129.3 - Actos one off 274.1 Amorti
Slide 27: Reconciliation from Reported to Core FY2018 Full Year
RECONCILIATION FROM REPORTED TO CORE FY2018 FULL YEAR REPORTED TO CORE ADJUSTMENTS REPORTED (BN YEN) Amortization & Other Shire Shire *1 Teva JV Gains on CORE *1 impairment of operating acquisition purchase related sales of Others intangible income/ related accounting accounting securities & assets
Slide 28: FY2018 Reconciliation from Reported to Core/Underlying Core: Legacy Takeda
FY2018 RECONCILIATION FROM REPORTED TO CORE/UNDERLYING CORE: LEGACY TAKEDA CORE TO REPORTED TO CORE ADJUSTMENTS UNDERLYING CORE ADJ. REPORTED UNDERLYING (BN YEN) Amortization & Shire Shire Teva JV Other Gains on CORE NOTE Other CORE impairment of acquisition purchase purchase purchase sales of U.S.
Slide 29: Reconciliation from Reported to Core/Underlying Core FY2019 Full Year
RECONCILIATION FROM REPORTED TO CORE/UNDERLYING CORE FY2019 FULL YEAR CORE TO REPORTED TO CORE ADJUSTMENTS UNDERLYING CORE ADJ. UNDERLYING (BN YEN) REPORTED Amortization & Other Shire Shire Teva JV CORE CORE impairment of operating acquisition purchase Swiss Tax related Others FX Divestitures intang
Slide 30: Reconciliation from Reported Operating Profit to Core Operating Profit – FY2020 Forecast
RECONCILIATION FROM REPORTED OPERATING PROFIT TO CORE OPERATING PROFIT – FY2020 FORECAST REPORTED TO CORE ADJUSTMENTS (BN YEN) REPORTED Amortization of Shire CORE Impairment of Other Shire intangible purchase intangible operating income/ integration assets accounting assets expense costs (Takeda) ad
Slide 31: Free Cash Flow
FREE CASH FLOW (BN YEN) FY2018 FY2019 vs. PY Net profit 135.1 44.3 -90.8 -67.2% Depreciation, amortization and impairment loss 257.8 685.5 +427.7 Decrease (increase) in trade working capital 20.9 72.7 +51.8 Income taxes paid -44.9 -226.8 -181.9 Other -40.4 94.0 +134.4 Net cash from operating activit
Slide 32: Net Debt/Adjusted EBITDA
NET DEBT/ADJUSTED EBITDA NET DEBT/ADJUSTED EBITDA RATIO NET INCREASE (DECREASE) IN CASH (BN YEN) FY2019 (BN YEN) FY2018 FY2019 vs. PY Net cash from operating activities 328.5 669.8 +341.3 +103.9% Cash and cash equivalents *1 637.6 Acquisition of PP&E -77.7 -127.1 Book value debt on the balance sheet
Slide 33: Reconciliation from Net Profit to EBITDA/Adjusted EBITDA
RECONCILIATION FROM NET PROFIT TO EBITDA/ADJUSTED EBITDA (BN JPY) FY2018 FY2019 Net profit for the year 135.1 44.3 Income tax expenses -7.5 -105.0 Depreciation and amortization 247.7 583.6 Interest expense, net 41.6 137.8 EBITDA 416.9 660.7 Impairment losses 10.1 101.9 Other operating expense (incom
Takeda Pharmaceutical Company — FY2019 Earnings Presentation on 6ix