Oriola Corp Class B · OMXHEX:ORIOLA
Oriola Corp Class B — Oriola-KD — Non-Deal Roadshow (August 2016)
36 slides from Oriola Corp Class B's roadshow presentation, August 2016
Slide 1: Oriola-KD
ORIOLA-KD Eero Hautaniemi, President and CEO August 2016 1 Oriola-KD Corporation
Slide 2: Disclaimer
Disclaimer It should be noted that certain statements herein which are not historical facts, including, without limitation, those regarding expectations for general economic development and the market situation, expectations for customer industry profitability and investment willingness, expectation
Slide 3: Oriola-KD in Brief
Oriola-KD in Brief Oriola-KD offers expert advice on health and wellbeing and an extensive and high-quality selection of products in its own pharmacies. To healthcare operators, Oriola-KD provides wide service offering covering pharmaceutical distribution, branded products and other tailored service
Slide 4: A history review: Milestones 2006 – 2016
A history review: Milestones 2006 – 2016 Acquisition of nationwide pharmacy chain in Sweden New operating Demerger of Orion Acquisition of Acquisition of Medstop, model and preparation of Moscow based new integrated Oriola-KD’s stock pharmacy chain and Acquisition of remaining pharmacy chain listing
Slide 5: Oriola-KD's Updated Strategy and New Operating Model
Oriola-KD’s Updated Strategy and New Operating Model 5 Oriola-KD Corporation
Slide 6: Changing Business Environment
Changing Business Environment DIGITALIZATION INCREASED SPENDING ON HEALTH & WELLBEING • Consumers are accustomed to a digital 24/7 world • Better income level enables people to prioritize health and wellbeing • The retail industry is undergoing a digital transformation • The availability of e-servic
Slide 7: Moderate Market Growth in Oriola-KD's Main Markets
Moderate Market Growth in Oriola-KD’s Main Markets SWEDEN FINLAND BALTIC COUNTRIES 2015 - 2019 CAGR 1-4 % 2015 – 2019 CAGR 2-5 % 2013 – 2018 CAGR 3-5% (1 USD million USD million USD million Sales Sales Estonia Lithuania Latvia Growth rate Growth rate Baltics growth rate 7 Oriola-KD Corporation Sourc
Slide 8: Solid Position in the Present Market Area
Solid Position in the Present Market Area MARKETS COVERED BY THE BIG THREE: One present Two present All three market 8 Oriola-KD Corporation
Slide 9: Fastest Growing Corporations are Focused on Specialty
Fastest Growing Corporations are Focused on Specialty TOP GLOBALLY TOP SPECIALTY TOP GENERICS Oriola-KD distribution, Finland Oriola-KD distribution, Sweden 9 Oriola-KD Corporation Source: IMS Health, Oriola-KD
Slide 10: Increasing Spending on Health and Wellbeing
Increasing Spending on Health and Wellbeing • Consumer Health represents over 10% of the total Pharmaceutical business globally • At EUR 81 billion OTC continues to grow while Pharma growth improves 10 Oriola-KD Corporation Source: IMS Health
Slide 11: Digitalization Drives Changes Across the Entire Value Chain
Digitalization Drives Changes Across the Entire Value Chain Sweden and Finland Other Markets Pharmaceutical wholesale and retail sector 11 Oriola-KD Corporation
Slide 12: The Changes in the Business Environment will Impact Oriola-KD
The Changes in the Business Environment will Impact Oriola-KD DISTRIBUTION PATTERNS WILL A PRODUCT MIX WILL EVOLVE B DIVERSIFY DUE TO ECOMMERCE RX specialty Other RX RX POLARIZATION RX generics # of orders OTC Average value of order GROWTH Traded Goods # of delivery points Current To-be mix mix PROD
Slide 13: New Operating Model - Better services for customers
New Operating Model - Better services for customers Consumer Consumers Vets Services Pharma Vets Groceries Pharmacies Companies Healthcare Public & Private Dentists Healthcare Vets Sourcing Logistics operations 13 Oriola-KD Corporation
Slide 14: Consumer Business Area
Consumer Business Area 14 Oriola-KD Corporation
Slide 15: Consumer Segment
Consumer Segment • Focus on the needs of consumers in health and wellbeing related products and services. • Offers expert advice on health and wellbeing as well as an extensive and high-quality selection of products in own pharmacies. • Consistent service experience throughout all service channels,
Slide 16: Growth Drivers in Consumer Business Area
Growth Drivers in Consumer Business Area 16 Oriola-KD Corporation
Slide 17: Case: New Care & Beauty Concept
Case: New Care & Beauty Concept Introducing leading premium beauty brands for the first time in pharmacy channel such as All skin care and beauty brands New premium concept, 4-500 Biotherm, Clarins, Clinique, presented in dedicated brand sqm, emphasizing skin care Dermalogica spaces and beauty , wit
Slide 18: Digital Consumer Strategy Strengthens Brand Positioning, Customer Loyalty and Profitability
Digital Consumer Strategy Strengthens Brand Positioning, Customer Loyalty and Profitability Digital presence will be enhanced and strengthened to • improve brand image • leverage physical and digital • support existing and new business • increase profit and productivity Digital transformation requir
Slide 19: Pharmacy Chains in Sweden
Pharmacy Chains in Sweden Pharmacies Market Share LloydsApoteket Apoteksgruppen Apotek Hjärtat & CURA Apoteket Pharmacies 2010 Established net 2010 - 2015 Established net 2016 Source: Apoteksförening and Oriola-KD 19 Oriola-KD Corporation
Slide 20: Consumer January – June 2016
Consumer January – June 2016 Adjusted Operating profit • On a constant currency basis the net sales increased by 4.3 (5.2) per cent • Positive development of Sales mix supported margin and Operating profit • Share of OTC and traded goods of net sales increased to 27.1 (26.0) per cent • Net increase
Slide 21: Services Business Area
Services Business Area 21 Oriola-KD Corporation
Slide 22: Services Segment
Services Segment • Focuses on long-term customer relationships and a wide service offering • Provides logistics services and wide range of value adding Services for healthcare actors who want to services for Pharmaceutical companies and pharmacies succeed in the Nordic and Baltic countries. • Purcha
Slide 23: Services January – June 2016
Services January – June 2016 • On a constant currency basis the Adjusted Operating profit invoicing increased by 6.3 (11.7) per cent. • Strong growth in invoicing was driven by Swedish operations • Growth in both services to pharmaceutical companies and to pharmacies • Increased number of order line
Slide 24: Healthcare Business Area
Healthcare Business Area 24 Oriola-KD Corporation
Slide 25: Healthcare Segment
Healthcare Segment DOSE DISPENSING SERVICES • The Healthcare segment offers services to hospitals, healthcare centres and other healthcare operators in Sweden. Svensk Dos in Sweden and PharmaService in • Many growing business opportunities, such as Finland are part of Oriola- hospital pharmaceutical
Slide 26: Relevant Market Segments For Healthcare Business Area in Sweden
Relevant Market Segments For Healthcare Business Area in Sweden Market size estimate Dose dispensing ~230 M€ • ~185 000 patients, annual medicine costs over 2 x average patient • County councils pay 0,1 - 0,5 EUR per patient/day for packaging • Secondary care dose dispensing growing Vet market: pets
Slide 27: Healthcare January – June 2016
Healthcare January – June 2016 • Acquisitions of Svensk Dos in February Adjusted Operating profit 2016 and Pharmaservice in July 2016 • Number of dose dispensing patients continued to grow • Sjuklövern tender process to be renewed • New digital platform for veterinarians launched in Sweden and capab
Slide 28: Key Figures January – March 2016
Key Figures January – March 2016 28 Oriola-KD Corporation
Slide 29: Oriola-KD Key Figures
Oriola-KD Key Figures Invoicing Net Sales Adjusted Operating profit 1-6/2016 net sales at comparable EUR/SEK 1-6/2016 adjusted operating profit at rate EUR 819 million comparable EUR/SEK rate EUR 28.6 million All figures for Continuing operations 29 Oriola-KD Corporation
Slide 30: Adjusted operating Profit January – June
Adjusted operating Profit January – June 2016 Adjusted Operating profit Adjusted Operating profit, waterfall 30 Oriola-KD Corporation
Slide 31: Cash flow
Cash flow Quarterly net cash flow from operating activities EUR million 1-6/2016 1-6/2015 Change in working capital -47.1 10.0 Net cash flow from operating activities -5.1 38.9 Net cash flow from investing activities -8.0 -29.2 Net cash flow from financing activities 1) -2.0 -31.0 Net change in cash
Slide 32: Net Interest-Bearing Debt
Net interest-Bearing Debt Net Interest-Bearing Debt 30 June 30 June EUR million 2016 2015 Syndicated bank loans 69.0 76.0 Commercial papers 45.0 10.4 Advance payment from 34.5 27.7 pharmacies Other 3.6 19.4 Cash and cash equivalents 85.7 91.5 Net interest-bearing debt 66.2 42.0 Sold trade receivable
Slide 33: Outlook for 2016
Outlook for 2016 • Oriola-KD estimates its full-year Net Sales to remain at the 2015 level on a constant currency basis. Adjusted Operating Profit is estimated to remain at 2015 level or to increase, on a constant currency basis. Full-year Net Sales in 2015 were EUR 1,626.3 million and Adjusted Oper
Slide 34: Balance Sheet and Key Ratios
Balance Sheet and Key Ratios 30 June 30 June 31 Dec EUR million 2016 20151) 2015 Goodwill 264.7 255.8 256.5 Equity 184.9 162.5 194.6 Interest-bearing debt 151.9 133.5 128.6 Interest-bearing net debt 66.2 42.0 6.6 Balance sheet total 934.1 911.9 946.9 Equity ratio, % 20.6 18.4 21.1 Return on equity (
Slide 35: Long-Term Financial Targets
Long-Term Financial Targets • Business growth at the rate of the market • Annual EPS growth over 5 per cent without non-recurring items • Return on capital employed of over 20 per cent • Adjusted gearing ratio of 30-60 per cent* • Dividend policy • Oriola-KD's aim is to pay out an increasing annual
Slide 36: Oriola-KD Corporation
& OriolaKD The Channel for Health