Ipsen Sa · EURONEXT:IPN
Ipsen Sa — H1 2008 Earnings Presentation
25 slides from Ipsen Sa's earnings presentation, Aug 29, 2008
Slide 1: First Half 2008 Results
FIRST HALF 2008 RESULTS August 29, 2008 FIRST HALF 2008 RESULTS
Slide 2: Disclaimer
DISCLAIMER This presentation includes only summary information and does not purport to be comprehensive. Forward-looking statements, targets and estimates contained herein are for illustrative purposes only and are based on management’s current views and assumptions. Such statements involve known an
Slide 3: An Innovation Driven International Specialty Pharma
AN INNOVATION DRIVEN INTERNATIONAL SPECIALTY PHARMA A strategic focus on Three targeted areas : Oncology, Endocrinology and Neuromuscular Disorders specialist care 5 key products accounting for ~ 57% of drug sales worldwide Growing at a double digit rate Focused on gastroenterology, cognitiv
Slide 4: First Half 2008 Highlights
FIRST HALF 2008 HIGHLIGHTS Jean-Luc Bélingard, Chairman & CEO FIRST HALF 2008 RESULTS
Slide 5: A Strong First Half 2008
A STRONG FIRST HALF 2008 Performance growth * Specialty care sales growth +11.2% +13.4% Reported operating margin Fully diluted EPS growth (in % of sales) 29.3% +42.1% NOTE: H1 2008/2007 growth rates 5 FIRST HALF 2008 RESULTS * Excluding Ginkor Fort® and at constant currency
Slide 6: A Rich Newsflow in the First Half 2008
A RICH NEWSFLOW IN THE FIRST HALF 2008 Acquisition of Tercica Progressing as per plan Î Building a fully fledged presence Acquisition of a commercial infrastructure for Dysport® Completed 9 in North America Acquisition of OBI-1 development rights Completed 9 Manufacturing inspections Filings of Relo
Slide 7: First Half 2008 Results
FIRST HALF 2008 RESULTS Claire Giraut, Chief Financial Officer FIRST HALF 2008 RESULTS
Slide 8: Sales Performance
SALES PERFORMANCE Sales performance by therapeutic area Sales performance by region +11.2%* +11.2%* +7.4% 497.4 +7.4% 497.4 463.2 463.2 +23.7% 91.6 74.1 +13.4% 278.1 +17.4% 245.3 106.1 124.6 In million euros In million euros 20.2 9.9 20.2 9.9 +3.2 %(1) +3.5%(1) 262.8 271.4 181.7 188.0 16.0 21.5 H1 2
Slide 9: Other Revenues Evolution
OTHER REVENUES EVOLUTION Stable Kogenate® royalties Royalties received Carry-over of some royalties into 2007 and + 51.4% 53.7 2008 5.9 In million euros Milestone payments 35.5 24.1 3.0 and licensing Roche, Medicis and Recordati partnerships agreements 8.5 €13.7 m recognized in the context o
Slide 10: Gross Margin Evolution
GROSS MARGIN EVOLUTION + Continued productivity improvements despite an increase in some raw materials and energy costs - Fast growing specialty care inducing a In % of sales favorable “mix effect” more than offset by (i) fast growth of in-licensed products, (ii) strong growth of drug-related sales
Slide 11: SG&A Expenses Evolution
SG&A EXPENSES EVOLUTION Efficient containment of actionable Sales Other sales & marketing + 3.6% & Marketing expenses reflecting 199.6 206.8 productivity improvements expenses + 2.5% 40.8 39.8 G&A Seasonality of Sales & Marketing costs In million euros Strong increase in royalties paid to thir
Slide 12: R&D Expenses Evolution
R&D EXPENSES EVOLUTION Major research and development projects: +5.2% at constant exchange rate Drug-related R&D Filing of Dysport® in the US 88.4 (1.1)% 87.3 Somatuline® in non-functioning NET 13.5 (38.4)% 8.4 Industrial & 1.7 Strategic Dopastatin phase I 2.8 development In million euros Su
Slide 13: Operating Income Evolution
OPERATING INCOME EVOLUTION +29.2% Strong performance of all products +15.6% 145.9 In million euros and in % of sales Higher “other revenues”, notably with the success 130.6 of the Ginkor Fort® divestment 112.9 Strong sales of in-licensed products and drug 29.3% related activities as well as st
Slide 14: Financial Income Evolution
FINANCIAL INCOME EVOLUTION H1 07 H1 08 Change Impact of Tercica convertibles and warrant conversion / exercise: €(2.2) m €0.9 m +€3.1 m - Increase of interests on convertible notes: €0.7 m €1.9 m +€1.2 m - Accelerated interests recognition on converts: - €8.3 m +€8.3 m - Fair value change on Terci
Slide 15: Income Tax Evolution
INCOME TAX EVOLUTION 27.3% Netherland’s H1 2008 benefited from a change in the tax rate cut % of Profit before tax computation rules of tax credits on research expenses in France 21.9% H1 2007 was negatively impacted by a reduction in the value of deferred tax assets in the Netherlands, followin
Slide 16: Net Income and EPS Evolution
NET INCOME AND EPS EVOLUTION Consolidated net profit Fully diluted EPS 111.1 1.32 +42.0% +42.1% 78.2 In million euros In euros 0.93 H1 2007 H1 2008 H1 2007 H1 2008 A strong overall performance 16 FIRST HALF 2008 RESULTS
Slide 17: Cash Flow Generation
CASH FLOW GENERATION 30 June 07 30 June 08 Comments (In million of euros) Cash Flow before change in working capital 112.6 141.3 Increase of receivables (-€36.8m) (Increase) / Decrease in working capital (65.3) (17.1) Increase of tax payables (+€24,4m) Net cash flow generated by operating activi
Slide 18: Outlook
OUTLOOK Jean-Luc Bélingard, Chairman & CEO FIRST HALF 2008 RESULTS
Slide 19: Major Key Milestones Still Ahead of Us This Year
MAJOR KEY MILESTONES STILL AHEAD OF US THIS YEAR… MISSION STATEMENT To be a worldwide best-in-class provider of innovative drugs, addressing unmet medical needs in its targeted therapeutic areas STRATEGIC PRIORITIES n GROW top-line and profits in o GLOBALISE through active p OPTIMISE returns of prim
Slide 20: Full Year 2008: Standalone Financial Outlook
FULL YEAR 2008: STANDALONE FINANCIAL OUTLOOK 2008 OLD objectives 2008 NEW objectives 2007 base Underlying: 6.5 to 7.5% (1) €883.6 millions Sales growth Upper end of the range Reported: 3.2 to 4.2% €920.5 millions Other revenues €73.3 millions 13.0 to 16.0% (2) 25.0 to 30.0% growth 22.0 to 23.0% 23.0
Slide 21: Ipsen Today
IPSEN TODAY…. Î Resilience of business in a difficult macro-economic environment Î A strong and profitable specialty care growth engine Î Substantial growth opportunities through globalization and US entry Î A rich and well balanced R&D pipeline, with potential blockbusters Î A strong cash flow gene
Slide 22: Appendix
APPENDIX FIRST HALF 2008 RESULTS
Slide 23: Tercica's Main Impacts on Ipsen's Accounts
TERCICA’S MAIN IMPACTS ON IPSEN’S ACCOUNTS H1 2007 H1 2008 (In thousand euros) Comments Convertible notes and warrant Change in fair value of warrant (1 058) (2 360) – Incl. Exchange rate impact (89) (491) Exercice/conversion date (July 22, Change in fair value of option (609) (4 944) 2008) taken
Slide 24: Balance Sheet Evolution
BALANCE SHEET EVOLUTION (In million euros) (In million euros) Assets Liabilities 31 Dec 07 30 Jun 08 31 Dec 07 30 Jun 08 Goodwill 189.0 189.0 Equity 799.9 844.1 Property, plants & equipments 221.9 226.6 Minority interests 1.2 1.4 Intangible assets 89.2 92.5 Total equity 801.1 845.5 Other non-current
Slide 25: Milestones Cashed In But Not Yet Recognized as Revenues
MILESTONES CASHED IN BUT NOT YET RECOGNIZED AS REVENUES (In million euros) 30 June 07 30 June 08 Payments not yet recognised as revenues in H2 8.3 11.2 Payments not yet recognised as revenues in Y+1 17.2 22.4 Payments not yet recognised as revenues in Y+2 and beyond 167.2 183.3 Total Milestones cash