FOURTH QUARTER REPORT PRESENTATION - Recipharm€¦ · FOURTH QUARTER REPORT PRESENTATION Thomas...

FOURTH QUARTER REPORT PRESENTATIONThomas Eldered, CEO

Tobias Hägglöv, CFO

3

BEST QUARTER EVERREACHING OUR TARGETS

18.5%EBITDA margin

367MSEK EBITDA

14%Sales increase

1.7

2.0

Q4 18 Q1 Q2 Q3 Q4 19

Net salesSEK bn

280

367

Q4 18 Q1 Q2 Q3 Q4 19

EBITDASEK m

Net sales of SEK 1,981 m, +14%

EBITDA SEK 367 m, +31%

EBITDA margin 18.5% (16.1)

Profit after tax SEK 90 m (-41)

Cash flow after working capital changes SEK 108 m (25)

Return on equity 6.7% (3.4)

Adj EPS SEK 2.04 (1.07)

4

STRONG BUSINESS MOMENTUMBENEFITTING FROM GLOBAL REACH AND ATTRACTIVE VALUE PROPOSITION

Strong growth in all three segments and in all geographies

Several new projects implemented in Solids & Others

Global development services continues to perform well, but negative impact from product mix and stock-outs in D&T

Underperformance in non-lyophilized injectables

Several promising new products in tech transfer with effect from next year

Recommended offer for Consort Medical Ltd, accepted after the period

STERILES & INHALATION

DEVELOPMENT & TECHNOLOGY

SOLIDS & OTHERS

SALES +14%EBITDA +17%

SALES +10%EBITDA +24%

SALES +29%EBITDA -17%

5

ITALY +16%

Brescia

Lainate

Masate

Paderno Dugnano

PORTUGAL +17%

Odivelas

Queluz

SPAIN +10%

Leganés

Parets

DOUBLE DIGIT ORGANIC GROWTHSALES GROWTH Q4 2019

USA +48%

Research Triangle Park

SWEDEN +6%

Stockholm

Höganäs

Karlskoga

Solna

Strängnäs

Uppsala

EUROPE

UK +12%

Ashton

GERMANY +10%

Wasserburg

FRANCE +8%

Fontaine

Kaysersberg

Monts

Pessac

ISRAEL +73%

Ness Ziona

INDIA +44%

BengaluruKarnal & Paonta Sahib

Manufacturing services Development services

Holmes Chapel

6

CREATING AN ADVANCED DELIVERY SYSTEMS COMPANY………….

Deep and broad

pharmaceutical expertiseInnovative device

offering

Complements Recipharm’s ambitious growth strategy

Enhances competitive position with combined scale and service offering

Creates a world leader in inhalation product technology

Enables innovative product offering

7

….. AND A TOP 5 GLOBAL CDMO

Bespak

Aesica

SEK

4bn

Steriles & Inhalation

Solids & Others

Development & Technology

SEK

7bn

Steriles & Inhalation

Solids & Others

Development & Technology

SEK 11bn

SEKbn

Combined (1)

1. Revenues rounded to nearest SEK billion for illustrative purposes2. LTM revenue figures: Last twelve months for Recipharm ending on 31 December 2019 and for Consort Medical ending on October 31, 2019

47

11

-

10

20

30

40

Competitor G Competitor F Competitor E Competitor D Competitor C Competitor B Competitor A

Th

ou

san

ds

ENHANCED SCALE

To become a top 5 global CDMO with >$1bn (>SEK 10bn) sales and increased ability to compete for global contracts with pharma companies

8

ACQUISITION OF CONSORT MEDICAL PLC

Offer documents posted December 6, 2019

Offer declared unconditional February 4, 2019 = Take-over date

Consort delisted, effect from March 6, 2019

Compulsory squeeze-out commencing February 20, 2019

As of February 19 Recipharm controls ~98% of Consort

New board of directors and top management appointed

Integration on-going

Immediate 60 day plan

Longer term implement synergies and common opportunities

£ 505 Million

Cash offer

FINANCIALSTobias Hägglöv(currency SEK million)

10

P&L DEVELOPMENT

*) Defined as Operating Cash Flow, including working capital changes and maintenance investments

Q4 2019 Q4 2018 2019 FY

Net sales 1,981 1,739 7,457

Organic 10% 8% 5%

Acquired - 12% 9%

Currency 4% 4% 3%

EBITDA 367 280 1,294

EBITDA margin 18.5% 16.1% 17.3%

Free Cash flow*) -93 -121 374

Earnings per share (adjusted) 2.04 1.07 5.78

IFRS 16 effect EBITDA 23

IFRS 16 effect EBITDA margin 1.2%-pts

11

EBITDA BRIDGE Q4 Y-O-Y

MSEK

307 354307

0

50

100

150

200

250

300

350

400

EBITDA Q4 2018 Steriles &Inhalation

Solids & Others Development &Technology

Discontinuedoperations

Other EBITDA Q4 2019

367

280

+57

+6

-9

+32

+47

+25

+33

12

MANUFACTURING SERVICES – STERILES & INHALATION

EBITDA BRIDGE, OCT – DEC

SALES BRIDGE, OCT – DEC

SEK million EBITDA

2018 151

Currency 8

Acquisitions -

Accounting standards (IFRS 16) 4

Organic 13

Total 25

2019 177

Sales, MSEK Sales, %

2018 743

Currency 37 5

Acquisitions - -

Organic 68 9

Total 105 14

2019 847400

500

600

700

800

Q4 2018 Currency Organic growth Q4 2019

100

120

140

160

180

Q4 2018 Currency IFRS - 16 Organic Q4 2019

13

MANUFACTURING SERVICES – SOLIDS & OTHERS




2018 729

Currency 21 3

Acquisitions - -

Organic 53 7

Total 74 10

2019 803

SEK million EBITDA

2018 135

Currency 4

Acquisitions -


Organic 22

Total 33

2019 168

400

500

600

700

800


100

120

140

160


14

DEVELOPMENT & TECHNOLOGY




2018 211

Currency 8 4

Acquisitions - -

Organic 53 25

Total 61 29

2019 271

SEK million EBITDA

2018 50

Currency 1

Acquisitions -


Organic -13

Total -9

2019 42

100

140

180

220

260


30

35

40

45

50

55


15

Q4 CASH FLOW

mSEK Q4 2019 Q4 2018 2019 YTD 2018 YTD

Operating Cash Flow 180 245 870 648

Total NWC changes -72 -220 -62 -284

Maintenance capex & other -200 -146 -434 -312

Free cash flow -93 -121 374 51

Expansion capex -15 -34 -69 -161

Business combinations -180 -447 -244 -754

Divestments - 4 21 90

Cash flow after investing activities -288 -598 81 -774

Net Debt/EBITDA 3.2 3.8 3.2 3.8

IFRS 16 effect on Net Debt/EBITDA -0.04 -0.04

16

NEW SEGMENTS FROM Q1, 2020

Steriles

Development & Licensing

Solids & Others

Advanced Delivery Systems

CONCLUDING REMARKSThomas ElderedCEO

18

REACHING OUR TARGETS

4,0

4,5

5,0

5,5

6,0

6,5

7,0

7,5

8,0

8,5

2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2020

Note 1. Excluding IFRS 16 effectNote 2. Proposal

6.4bn

8.0bn

LTM Sales/Quarter Current status Financial targets

At least SEK 8 billion sales by 2020

8 bn+14% Q4

+17% 2019

EBITDA margin at least 16%>16%

17.3%1 Q4

16.1%1 2019

Net debt to equity ratio less than 0.8<0.80.7 Q4

Dividend 30-50% of net profit30-50%SEK 1.602 2019

19

NEW FINANCIAL TARGETS

SALES

PREVIOUS

SEK8 BNBy 2020

NEW

LONG-TERM GROWTH OF

≥11%CAGR

MARGINPREVIOUS

EBITDA16%

NEW

EBITA ≥12%

CAPITALEFFICIENCY

NEW

RETURN ON OPERATING

CAPITAL

≥10%

PREVIOUS

ND/EQ<0.8

Note. All measures are Alternative Performance Measures

20

SUMMARY 2019CREATING A PLATFORM FOR FURTHER ACCRETIVE GROWTH

17.3%EBITDA margin

1294MSEK EBITDA

17%Sales increase

Well invested in attractive, high demand areas

Growing demand from current and new customers

Good organic growth and expanding margins

Strong cash flow, reduced capex and lower leverage

Improved ROCE, ROE and EPS

Transformational acquisition of Consort Medical Ltd

Advanced delivery systems and a top 5 Global CDMO

22

Q&A

23

CONTACT INFORMATION

Thomas Eldered

CEO & Managing Director

+46 (0)8 602 52 10

Tobias Hägglöv

CFO & EVP

+46 (0)8 602 52 00, [email protected]

FOURTH QUARTER REPORT PRESENTATION - Recipharm€¦ · FOURTH QUARTER REPORT PRESENTATION Thomas...

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