Japan Lifeline Co., Ltd. · TSE:7575
Japan Lifeline — Investor Presentation (May 2023)
32 slides from Japan Lifeline's investor presentation, May 10, 2023
Slide 1: Mid-Term Plan
Mid-Term Plan FYE March 2024 to FYE March 2028 Date of Release ：May 10, 2023 Financial Results Briefing ：May 11, 2023 Japan Lifeline Co., Ltd. TSE Prime Market /Ticker Symbol 7575 Unauthorized copying prohibited. Copyright © 2023 Japan Lifeline Co., Ltd. All rights reserved.
Slide 2: Renewal of Mid-Term Plan
Renewal of Mid-Term Plan ✓ We transformed the business in the past 1-2 years, which involved reviewing the portfolio: • Phased down the coronary intervention business*1, including early termination of the drug- eluting coronary stent "Orsiro". • Terminated exclusive sales of "RF Needle," one of the
Slide 3: Agenda
Agenda 1. Business Overview マ 2. Management Philosophy マ ー ー ジ ジ ン 3. Mid-Term Guidance ン 指 指 定 定 2 4. Capital Strategy 2 . . 0 0 5. Sustainability cm cm マージン指定1.5cm 3
Slide 4: Agenda
Agenda 1. Business Overview マ 2. Management Philosophy マ ー ー ジ ジ ン 3. Mid-Term Guidance ン 指 指 定 定 2 4. Capital Strategy 2 . . 0 0 5. Sustainability cm cm マージン指定1.5cm 4
Slide 5: Our Track Record
Our Track Record ✓ Japan Lifeline has grown based on a unique manufacturing and distribution business model and by offering one-of-a-kind in-house products. FYE March 2023 ¥bln Net Sales 60 ¥51.7bln Net Sales-In-house Net Sales-Third Party マ 50 マ ー TSE 1st Section ー ジ Launched Open Stent Graft Froze
Slide 6: Business Domain
Business Domain ✓ Japan Lifeline specializes in cardiovascular therapeutic areas, breaking down into four product categories ✓ Expanding therapeutic areas to Gastrointestinal (GI) and neurovascular*1 In-house sales ratio Cardiac • Implantable medical devices to treat Gastrointestinal Rhythm arrhythm
Slide 7: Market
Market ✓ Expect the domestic medical device market to continue to grow at a stable CAGR of 2-3% in the future ✓ Have a strong foothold in the cardiac-related market and are now exploring new markets with growth potential Product Diseases Market Size Market Net Sales Japan Lifeline- Category Growth*1
Slide 8: Business Model
Business Model ✓ Hybrid business model of full-service distributor and manufacturer ✓ Nationwide sales force and the regulatory affairs function necessary to distribute medical devices ✓ Sales representatives in close touch with the end-user medical facilities (doctors) ✓ Deposit inventory with ster
Slide 9: Sales System
Sales System ✓ 48 domestic sales offices that cover major medical facilities nationwide ✓ Local sales reps collect unmet needs in clinical settings to generate ideas for next products Sales Branch Domestic マ Offices in Japan Sales Reps マ ー ー ジ ジ ン 指 48 430 Head Office Branch Office Factory ン 指 定 Log
Slide 10: Agenda
Agenda 1. Business Overview マ 2. Management Philosophy マ ー ー ジ ジ ン 3. Mid-Term Guidance ン 指 指 定 定 2 4. Capital Strategy 2 . . 0 0 5. Sustainability cm cm マージン指定1.5cm 10
Slide 11: Our Philosophy and Vision
Our Philosophy and Vision Contributing to the realization of Philosophy a healthy society through the latest マ optimal medical device technologies マ ー ー ジ ジ ン ン 指 指 定 定 2 2 . . 0 0 Pursue both functions of a manufacturer cm cm and a distributor to provide the latest and Vision best options for medic
Slide 12: How Our Business Model Makes a Difference
How Our Business Model Makes a Difference ✓ Our "two-way" business model is highly flexible, allowing us to adapt to rapidly changing business environments and continuously update our product portfolio in a timely and flexible manner. Manufacturer Full-Service Distributor Business Foundations マ Pr
Slide 13: Agenda
Agenda 1. Business Overview マ 2. Management Philosophy マ ー ー ジ ジ ン 3. Mid-Term Guidance ン 指 指 定 定 2 4. Capital Strategy 2 . . 0 0 5. Sustainability cm cm マージン指定1.5cm 13
Slide 14: Framework of New Mid-Term Plan
Framework of New Mid-Term Plan ✓ We have set the framework of the new mid-term plan as below, and will review the progress annually マ • Target Period FYE March 2024 to FYE March 2028 (fixed five years) マ ー ー ジ • KPI Targets Net Sales, Net Sales (New Businesses*1), Operating Profit Margin, ジ ン ン 指 指
Slide 15: Mid-Term KPI Targets (FYE Mar. 2024 to 2028)
Mid-Term KPI Targets (FYE Mar. 2024 to 2028) ✓ Focus on achieving steady growth in sales and operating profit, while also prioritizing efficient capital management. Net Sales Net Sales OP Margin EPS ROIC (New Businesses*1) マ ¥63bln ¥8bln 20% level ¥120 12% マ (FYE March 2028) (Each fiscal year) (FYE
Slide 16: Mid-Term Business Outlook – CRM
Mid-Term Business Outlook – CRM ✓ Maintain sales growth in a challenging competitive environment that is in line with the market growth rate Market Growth Rate*1(in value terms est.) Sales Growth Target CAGR CAGR +0% マ (Brady -1~-2%, Tachy +1~+2%) +0% マ ー ー ジ Strategies/Assumptions ジ ン ン 指 Assuming
Slide 17: Mid-Term Business Outlook – EP/ABL
Mid-Term Business Outlook – EP/ABL ✓ While anticipating a sharp decline in EP/Ablation sales in the short term due to the termination of the exclusive distribution for RF Needles in March 2023, we plan to achieve market-level growth by expanding sales of individual products, introducing new products
Slide 18: Mid-Term Business Outlook – Cardiovascular (Aorta)
Mid-Term Business Outlook – Cardiovascular (Aorta) ✓ Further solidify the top share position at CV (aorta) with reinforced one-of-a-kind products Market Growth Rate (in value terms est.) Sales Growth Target CAGR CAGR マ +0-1% +3-4% マ ー ー ジ ジ Strategies/Assumptions ン ン 指 Aim for growth in a flat marke
Slide 19: Mid-Term Business Outlook – Cardiovascular (Neurovascular)
Mid-Term Business Outlook – Cardiovascular (Neurovascular) ✓ Aiming for high growth in acute ischemic stroke treatment by introducing Wallaby Medical's differentiated neurovascular devices early. Market Growth Rate (in value terms est.) Sales Target CAGR Net Sales ¥4.5bln*1 (FYE Mar. 2028) Acute Isc
Slide 20: Exclusive Distribution Agreement with Wallaby Medical
Re-posted from Exclusive Distribution Agreement with Wallaby Medical FYE Mar. 2023 Q2 IR material (Edits are shown in red) ✓ Entered into a 10-year exclusive distribution agreement for 11 neurovascular treatment devices. Neurovascular Intervention Space Launch Dec. 2021 Embolic Coil (Launched) マ FYE
Slide 21: Neurovascular Intervention Market
Re-posted from Neurovascular Intervention Market FYE Mar. 2023 Q2 IR material (Edits are shown in red) ✓ Broadly divided into acute ischemic stroke, cerebral aneurysm, and carotid artery stenosis ✓ Total market estimated to be approx. ¥30bln ¥29bln in 2022 with CAGR +5-6%4-5% growth in the future Ce
Slide 22: Pipeline for Neurovascular Products
Re-posted from Pipeline for Neurovascular Products FYE Mar. 2023 Q2 IR material (Edits are shown in red) ✓ Expect to have the best lineup in the industry within five years, even though a latecomer Acute Ischemic Stroke Cerebral Aneurysm Aspiration Stent Balloon Microcath Guiding PTA Embolic Stent Fl
Slide 23: Mid-Term Business Outlook – Gastrointestinal
Mid-Term Business Outlook – Gastrointestinal ✓ Launch a series of in-house products in GI (biliary-pancreatic) area to build a stable revenue pillar in five years Market Growth Rate (in value terms est.) Sales Target CAGR +3-4%*1 Net Sales ¥3.5bln (FYE Mar. 2028) マ (Ref. FYE Mar. 2023 ¥650mln) マ ー ー
Slide 24: Risks and Assumptions
Risks and Assumptions ✓ The main business risks and assumptions incorporated in the medium-term management plan are as follows (in order of importance) Assumptions Risks Explanation factored in the plan Unexpected loss of market • Sales of BeeAT and Frozenix (one-of-a-kind products) accounted for mo
Slide 25: Agenda
Agenda 1. Business Overview マ 2. Management Philosophy マ ー ー ジ ジ ン 3. Mid-Term Guidance ン 指 指 定 定 2 4. Capital Strategy 2 . . 0 0 5. Sustainability cm cm マージン指定1.5cm 25
Slide 26: Cash Allocation
Cash Allocation ✓ Expect to earn a stable operating cashflow for the next five years ✓ After securing the necessary cash, we will consider how to allocate excess cash according to the following priorities: ①Acquire business assets Demo machines and programmers マ Excess Cash Consider allocations requ
Slide 27: Growth Investments
Growth Investments ✓ Over the five years, we plan to invest about ¥4-5 billion yen annually in growth, primarily in research and development. Item Amount Comment R&D ¥2-3bln/year • Accelerate R&D in the areas of GI (biliary-pancreatic), PFA*2, balloon ablation, high-function shafts, regenerative med
Slide 28: Shareholder Return Policy
Shareholder Return Policy ✓ Significantly strengthen shareholder returns through dividends and share buybacks ✓ Decide measures based on business results and KPI targets (EPS ¥120, ROIC 12%*1) ¥bln FY3/2021 FY3/2022 FY3/2023 FY3/2024 Actual Actual Actual Guidance We plan to allocate approx. ¥25bln D
Slide 29: Agenda
Agenda 1. Business Overview マ 2. Management Philosophy マ ー ー ジ ジ ン 3. Mid-Term Guidance ン 指 指 定 定 2 4. Capital Strategy 2 . . 0 0 5. Sustainability cm cm マージン指定1.5cm 29
Slide 30: Sustainable Practices: Our Philosophy and System
Sustainable Practices: Our Philosophy and System ✓ ESG and sustainability initiatives improve our management philosophy and corporate value. ✓ The Sustainability Committee, led by the President and CEO, will promote these initiatives. Our view on sustainable practices Sustainability System マ Improve
Slide 31: Sustainable Practices: Our Approach and Actions
Sustainable Practices: Our Approach and Actions ✓ Tackle our identified key issues with short-term and long-term objectives Our key issues (materiality) Key measures/achievements SDGs • Monitoring R&D activities • Solve medical issues through マ Philosophy innovative medical devices • Applying propri
Slide 32: Precautions
Precautions Forward-looking statements in this document are based on the Company's future outlook and plans. Statements relating to clinical trials, regulatory approvals, product launches, and timing are projections based on past experience and available information. Actual results may differ due to