Venture Life Group Plc · LSE:VLG
Venture Life — FY2022 Earnings Presentation
36 slides from Venture Life's earnings presentation, 2023
Slide 1: The partner of choice for self-care products
The partner [ of choice for self-care products Full Year Results to 31st December 2022 The partner of choice or self-care products enture Life Group plc [ nterim Results 2021 and update on Acquisitions ptember 2021
Slide 2: Important notice
This document (the "Presentation") is being provided to a limited number of parties who have previously expressed an interest in acquiring an interest (the "Investor Interest") in Venture Life Group plc (the "Company"). If you are in any doubt about the investment to which the Presentation relates,
Slide 3: Full Year Progress – Revenue, EBITDA & Cash Generation
Full Year Progress – Revenue, EBITDA & Cash Generation * Group Revenue £’m Gross Profit £’m / % Adj. EBITDA1 £’m / % 20.0 17.7 40.5% 10.0 25.0% 44.0 15.0 13.0 40.0% 8.0 20.0% 10.7 39.5% 6.0 15.0% 32.8 10.0 7.3 8.0 9.0 39.0% 4.0 10.0% 26.7 6.6 5.0 20.2 38.5% 2.0 3.0 4.0 5.0% 18.8 2.7 - 38.0% 0.0 0.0%
Slide 4: Key themes 2022
Key themes 2022 • Positive impact of 2021 acquisitions, gross margin improvement driven by accretive M&A • Delivering increased levels of EBITDA margin and cash generation • Strong order book, comfortably ahead of the same time previous year (like for like) • Multiple organic revenue growth opportun
Slide 5: Mergers & Acquisitions Update
Conclusions Mergers & Acquisitions Update
Slide 6: HL Healthcare Overview
HL Healthcare Overview1 6.0 Revenue (£m) 4.98 • Acquired 30 November 2022 for £13 million, EV 5.0 multiple 6.0x EBITDA under VLG ownership CAGR 3.85 32% 4.0 • Acquired brands; Earol, Earol Swim and 2.86 Sterinase 3.0 • Revenue CAGR of 32% over last 3 years 2.0 1.0 • Revenue for twelve months ended 3
Slide 7: Recent Acquisitions Performance
Recent Acquisitions Performance1 BBI Healthcare Acquired Jun-21 Helsinn Acquired Aug-21 • Acquired brands; Lift, Glucogel, Balance Activ • Acquired brands; Gelclair, Pomi-T, Xonrid • Revenue CAGR of 12% over last 3 years • Revenue CAGR of 4% over last 3 years • Contributed £11.9m into Group revenues
Slide 8: Financial Overview
Conclusions Financial Overview Financial Highlights
Slide 9: Financial Progress across key measures of success
Financial Progress across key measures of success Group Revenue £’m Gross Profit £’m Adj EBITDA1 £’m 50 20 10 11.2 44.0 4.7 17.7 2.4 9.0 45 18 9 40 16 8 32.8 13.0 6.6 35 14 7 30 12 6 25 34% 10 36% 5 36% 20 8 4 15 6 3 10 4 2 5 2 1 0 0 0 2021 Growth 2022 2021 Growth 2022 2021 Growth 2022 Operating Pro
Slide 10: Revenue £44.0 million growth +34% in 2022
Revenue £44.0 million growth +34% in 2022 48.8 Run-rate Mix 44.0 42.6 % 57.4 20.6 % 32.8 20.6 26.7 +41% 14.5 20.2 18.8 16.0 13.1 14.3 13.5 27.9 12.1 9.1 23.1 7.2 11.6 10.5 17.9 11.3 +29% 8.0 6.5 6.6 6.7 3.8 4.5 0.7 1.1 2014 2015 2016 2017 2018 2019 2020 2021 2022 Run-rate VLG Brands Customer Brands
Slide 11: VLG Brands portfolio £23.1m Revenue (2022)
VLG Brands portfolio £23.1m Revenue (2022) Footcare Dermatology 5% Other 1% Diabetes & 8% Energy 27% 5.6 2022 Actual Revenue Oral Care 20% 4.2 Customer VLG Brands Ear, Nose & Brands Throat 1% Oncology Women's Support Health 2.2 2.1 2.1 12% 26% 1.9 1.4 1.3 0.9 0.4 0.4 0.2 0.1 0.2 0.1 0.1 0.2 - - - Ha
Slide 12: VLG Brands Revenue 2022 performance
VLG Brands Revenue 2022 performance 6.0 5.5 VLG Brands Revenue £'m By Brand 5.1 5.0 2022 Actual 2021 Actual 2021 Proforma Overall VLG Brands reported growth of 4.2 £5.2m / 29% in 2022 (proforma1: £0.4m / 2%)***: 4.0 3.1 3.0 2.8 • Diabetes & energy management 2.4 2.6 2.2 2.1 2.1 2.1 revenues grew £3.
Slide 13: VLG Brands Revenue £'m split by division
VLG Brands Revenue £’m split by division 27.9 2022 Headlines • UK & EU Retail revenues grew £3.5m / 34% • International division delivered growth of £1.9m / 27% 23.1 Revenue CAGR 2018-2022 • UK & EU Retail 42%, International 30% • Overall VLG Brands 37% 17.7 16.2 13.9 11.7 10.4 8.9 9.2 7.3 6.6 6.7 6
Slide 14: UK and International VLG Brands £23.1m Revenue (2022)
UK and International VLG Brands £23.1m Revenue (2022) UK & EU Retail International 6.0 5.0 39.9% 4.0 Customer VLG Brands 60.1% Brands 3.0 2.0 1.0 - Lift Dentyl Other Oral 7 Xonrid Ultradex Proctoeze Glucogel Balance Activ Lissio Pomi-T Sterinase Earol Neuroage Vonalei Gelclair Hand Sanitizer Gel Ros
Slide 15: Gross Margin % improvement
Gross Margin % improvement • Gross margin % increased by 0.6ppts YoY despite the challenging supply chain backdrop: • Raw materials, packaging and transportation cost increases adversely impacted margin by 2.2ppts (COGs reflected materials procured during late 2021 at higher input prices) • Cost inc
Slide 16: Administrative expenses
Administrative expenses* Administrative Costs By Department £’m • Admin expenses increased by £2.3m / 37% YoY: 10.0 2021 2022 8.7 9.0 • Full year impact of previous acquisitions (BBI 8.0 acquired Jun-21 and Helsinn acquired Aug-21) £0.7m. 7.0 6.4 6.0 • Marketing investment of VLG Brands £0.5m 5.0 4.
Slide 17: Depreciation & amortisation costs
Depreciation & amortisation costs Depreciation & Amortisation Costs £'m Depreciation and amortisation costs increased 6.0 2021 2022 by £1.7m / 46% YoY: 5.4 5.0 • Full year impact of previous acquisitions 4.0 3.7 (BBI acquired Jun-21 and Helsinn acquired Aug-21) £1.2m. 2.8 3.0 1.8 • New acquisition i
Slide 18: Finance & tax costs
Finance & tax costs Net finance costs increased by £1.1m YoY: • Interest payable increase of £0.4m to £0.6m (2021: £0.2m) reflects full year impact of Group’s debt position as swung from net cash to net debt in mid-2021 upon acquisition of BBI. • Additional adverse FX impact of £0.4m arising largely
Slide 19: 2022 P&L summary and run-rate
2022 P&L summary and run-rate* “Clear improvement across all the key measures of revenue, gross profit and EBITDA are translating to growth in operating profit and increased cash generation, enabling rapid repayment of debt, with further positive run-rate impact from the HL acquisition”. 2021 2022 R
Slide 20: Cashflow 2022
Cashflow 2022 £ million 2022 2021 Movement Comments (by exception) Operating cash flow before movements in working capital 7.5 5.1 +47% Attributable to EBITDA growth. Build to protect supply (nb: inventory Working capital movements – Inventory (2.3) 0.7 days in line with previous year). Working capi
Slide 21: Net leverage position
Net leverage position December December £’million Comments (by exception) 2022 2021 Increased draw to fund acquisition payments (HL* Revolving Credit Facility (17.3) (8.5) £8.0m / Helsinn £2.5m) Payable November 2024 and accruing interest SONIA + Loan-note (2.0) - 5.0% Cash 5.6 5.2 Net Cash / (Debt)
Slide 22: Balance sheet 31 December 2022
Balance sheet 31 December 2022 £ million Dec 2022 Dec 2021 Movement Comments (by exception) Reflecting HL* acquisition for fair value of £15.2m Intangible non-current assets 78.7 65.1 +21% (EV £13.0m). Tangible non-current assets 10.1 9.7 +4% Investment in Biokosmes during 2022. Deferred tax asset 2
Slide 23: 2022 profit and loss account
2022 profit and loss account £ million 2022 2021 Change Slide Revenue 44.0 32.8 +34.2% 10-14 Gross profit 17.7 13.0 +36.3% Gross margin 40.2% 39.6% +0.6ppts 15 Administrative expenses (excl. depreciation, 8.7 6.4 +36.9% 16 amortisation and share based payments) Adjusted EBITDA1 9.0 6.6 +35.8% Adjust
Slide 24: Commercial highlights
Conclusions Commercial highlights Commercial Financial Highlights Highlights
Slide 25: Women's Intimate Healthcare – Balance Activ Full Year highlights
Women’s Intimate Healthcare – Balance Activ Full Year highlights - 2022 Volume1 Sales Market Share Trend %: BV sub-category • Balance Activ growth +8%/+£0.4m in FY22 to £5.5m (FY21: £5.1m) on a pro-forma1 basis. L12W vs LY YTD vs LY L52W vs LY UK Market Total Market -4.3% -4.4% -3.8% • No.1 brand (v
Slide 26: Diabetes/Energy Management - Lift Full Year highlights
Diabetes/Energy Management - Lift Full Year highlights - 2022 Value Sales Lift Market Growth Energy/Sports Nutrition* • Lift growth +36%/+£1.1m in FY22 to £4.2m Value (in £K) Linear (Value (in £K)) (FY21: £3.1m) on pro-forma basis 1,025.7 852.4 UK/International Markets 652.9 • Strong growth across a
Slide 27: Oral Care – Dentyl & UltraDEX Full Year highlights
Oral Care – Dentyl & UltraDEX Full Year highlights - 2022 • -10%/-£0.5m1 decrease in total oral care brands to £4.9m in FY22 (FY21: £5.4m) UK – Dentyl • Difficult market conditions: • Q1 price increase impacted sales • Fresh Protect delisted in Sainsbury’s • Amazon bulk buy did not happen • UK mouth
Slide 28: HL Healthcare Acquisition Integration & forward planning
HL Healthcare Acquisition Integration & forward planning Focus for 2023: • Acquired 30th November 2022 • Marketing commenced – research, brand • 3 brands in 1 new therapy area – ENT revitalisation underway • Earol is key brand • Innovation underway • No.2 brand in the UK ear care market and fastest
Slide 29: Oncology Support Full Year highlights
Oncology Support Full Year highlights - 2022 Oncology Support • -3%/£0.01m decrease in FY22 to £2.8m (FY21: £2.9m) due to order phasing • New partners signed for Gelclair: • Brazil – signed with Blau Farmaceutica – 35 years experience in LATAM in Oncology & Specialty Care • Canada & Vietnam – positi
Slide 30: Dermatology/Nail & Footcare Full Year highlights
Dermatology/Nail & Footcare Full Year highlights - 2022 Dermatology/Nail & Footcare • -1%/£0.04m decrease in FY22 to £3.01m (FY21: £3.05m) • Nail/Footcare - new EU BD manager to extend nail/footcare products into EU retailers/discounters • New ‘own label’ agreements signed with major retailers on va
Slide 31: Customer Brands business Full Year highlights
Customer Brands business Full Year highlights - 2022 Customer Brands Business • +41%/+£6.0m increase in FY22 to £20.8m (FY21 : £14.8m) • Return to strong growth after quiet 2021, recovery to order patterns pre-2021 • Growth from existing customers: Customer Brands Revenue £'m Due to growth in their
Slide 32: VLG's Manufacturing Scalability
VLG’s Manufacturing Scalability 120 Gnesta Biokosmes Item Group 100 Units produced LTM 35m units Units produced (million) 80 Existing capacity 65m units 100 60 75 Utilisation (% of capacity) 54% 40 55 Capacity with £4.0m capex 91m units 20 33 investment 2 10 16 16 - Capacity with further £8.0m capex
Slide 33: Sustainable Life – to be a Trusted, Responsible and Sustainable Business
Sustainable Life – to be a Trusted, Responsible and Sustainable Business Sustainable Development Goals (SDGs) • The 2030 Agenda for Sustainable Development, was adopted by all United Nations Member States in 2015, and provides a shared blueprint for peace and prosperity for people and the planet, no
Slide 34: Priority SDGs
Priority SDGs SDG 3 – Good health and wellbeing • Supporting our colleagues and consumers to lead healthier lives SDG 7 – Affordable & clean energy • Progressing towards sourcing more of our energy from renewable resources SDG 8 – Decent work and economic growth • Helping our colleagues to succeed b
Slide 35: Sustainable Life – Key achievements in 2022
Sustainable Life – to be a Trusted, Responsible and Sustainable Business Key achievements in 2022: • ESG team established across the Group, with additional resource • 77% reduction in carbon emissions from transport, by changing transport methods • B Corp, Life Cycle and Carbon Footprint analysis be
Slide 36: Proactive, adaptable, resilient…2022 at a glance
Proactive, adaptable, resilient…2022 at a glance Highlights Outlook • Strong revenue growth of 17% like for like, • Full year effect in 2023 of HL Healthcare growth from both acquired and organic Ltd acquisition • Gross margin improved through scale • High visibility of H1 revenue through strong ord