Selvita Sa · GPW:SLV
Selvita Sa — Q1 2023 Earnings Presentation
45 slides from Selvita Sa's earnings presentation, May 31, 2023
Slide 1: Q1 2023 Financial Results – Selvita Research Centre Opening
Q1 2023 FINANCIAL RESULTS SELVITA RESEARCH CENTRE OPENING May 31, 2023
Slide 2: Disclaimer
Disclaimer This presentation ("Presentation") has been prepared by Selvita S.A. with its registered office in Cracow (the "Company") and is intended for informational purposes only. Its purpose is to present selected data on Selvita S.A. Group and its development prospects. The information contained
Slide 3: Agenda
Q1 2023 RESULTS | SELVITA RESEARCH CENTRE OPENING AGENDA INTRODUCTION Q1 2023 FINANCIAL RESULTS BOGUSŁAW SIECZKOWSKI, MBA MIROSŁAWA ZYDROŃ, PHD, MBA CHIEF EXECUTIVE OFFICER CHIEF OPERATING OFFICER INFRASTRUCTURE DRUG DISCOVERY SEGMENT SUMMARY ADRIJANA VINTER, PHD, MBA DARIUSZ KURDAS GLOBAL HEAD OF D
Slide 4: Introduction
» Selvita INTRODUCTION
Slide 5: 2007-2014: Development of the first services offer
2007-2014: Development of the first services offer FOUNDERS FIRST INVESTORS FIRST CHAPTER IPO on Revenues [mEUR] First client 0.9 mEUR in the US for services development 4 Foundation of IPO on First client in Poland First international clients 3 Break even point Q4 2013 2 Acquisition of First labs i
Slide 6: 2015-2019: Dynamic international expansion
2015-2019: Dynamic international expansion Corporate split into Revenues [mEUR] Sales offices USA/Boston 25 UK/Cambridge 20 Sales office Labs USA/San Francisco in Poznan Foundation of 15 10 21.5 15.6 5 11.3 5.8 7.9 3.6 0 0.02 1.5 2007 2011 2014 2015 2016 2017 2018 2019 6
Slide 7: 2020-2022: Accelerated growth
2020-2022: Accelerated growth Acquisition of Corporate Corporate strategy Revenues strategy 2022-2025 [mEUR] 2020-2023 100 SPO – 19.4 mEUR 90 80 70 Purchase of the 60 plot in Krakow 50 40 87.5 30 66.3 20 10 21.5 29.2 0 0.02 1.5 3.6 2007 2011 2014 2019 2020 2021 2022 7
Slide 8: Selvita in May 2023
Selvita in May 2023 Revenues No. of [mEUR] employees ~900 27 33% 64% 100 1 200 90 employees nationalities Scientists of employees +180 Ardigen with PhD are women 1 000 80 70 800 6 locations 14 300 m² 60 50 600 in PL, HR, UK and US lab space 40 400 30 20 200 10 0 0 2007 2008 2009 2010 2011 2012 2013
Slide 9: Krakow as one of the strongest life science hubs in CEE
Krakow as one of the strongest life science hubs in CEE 5 Selvita is becoming more international Poland's rank in the EU by the Vast talent pool FOREIGNERS: ~4000 number of scientists 40% of candidates applications per year ~30% 40% graduates 2500 30% PhDs of new hires graduates per year 20% educate
Slide 10: Selvita Research Centre: an important milestone
Selvita Research Centre: an important milestone STABILITY RELIABILITY POTENTIAL FOR FURTHER GROWTH BETTER EFFICIENCY 10
Slide 11: Q1 2023 Financial Results
» Selvita Q1 2023 FINANCIAL RESULTS
Slide 12: Q1 2023 results summary
Q1 2023 results summary The results exceed preliminary estimates Expected increase in contracting in H2 2023 Q1 2023 preliminary estimates GROWTH DESPITE DEMANDING MARKET vs execution • Revenues from commercial clients: 18.9 mEUR • EBITDA: 4.1 mEUR(1) 20.8% • Numerous investments in sales 19-21% 9%
Slide 13: Funding in 2022 dropped, but biotechs have high cash reserves
Funding in 2022 dropped, but biotechs have high cash reserves Funding of the global biopharmaceutical sector(1) Cash reserves [USD bn] TOP100 biotechnology companies(2) Median cash [USD bn] Total cash [USD bn] 160 0,8 240 140 134.5 0,7 210 118.4 120 0,6 180 100 0,5 150 80 0,4 120 67.0 57.9 60.8 60 5
Slide 14: Big pharma have high R&D budgets and tend to increase outsourcing
Big pharma have high R&D budgets and tend to increase outsourcing of services Big pharma spending on R&D(1) % of outsourced R&D work by big pharma(2) [USD bn] [USD bn] 160 136 138 140 50% 123 120 110 Q4 2022 47% 100 41% Late-Stage Development 80 Early-Stage Development 60 Discovery 42% 40 Q4 2021 39
Slide 15: Q1 2023 – Growth in demanding external conditions
Q1 2023 – Growth in demanding external conditions mEUR Total revenues EBITDA(1) Net profit(1) +9% (24%) (53%) 18.1 19.5 5.4 3.2 4.1 1.5 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Profitability 29.6% 20.8% 17.8% 7.6% Results above the preliminary estimates Pressure on margins due to increase in
Slide 16: Services executed in Poland
Services executed in Poland Commercial revenues(1) [mEUR] +16% 16% revenues growth Drug discovery (12% growth) – lower utilization of resources 11.3 in Chemistry, dynamic growth of Biology and Biochemistry 9.8 Regulatory studies – 29% growth Q1 2022 Q1 2023 Unused resources related to new building o
Slide 17: Services executed in Croatia
Services executed in Croatia Commercial revenues [mEUR] Flat revenues (1%) Currently higher utilities costs 7.8 7.6 Lower contracting of high margin services in Q1 Strong foundation for further development Q1 2022 Q1 2023 • Suitable lab space (Hondlova used from Jan 22) • Integration under Selvita b
Slide 18: The financial position of the Group allows for investments in further development
The financial position of the Group allows for investments in further development Selvita Capital Group’s net debt(1) Selvita Capital Group's financial debt structure(1) mEUR Financial debt Cash position Net debt 22.1% Selvita Capital Group 47.8 12(1) 36 Space rental EBITDA LTM(2) 22 55.0% Net debt
Slide 19: Backlog 2023
Backlog 2023 Group backlog reported for a given year as of May(1) Backlog dynamics in 2021-2022 [mEUR] [mEUR] 2022 vs 2021 2021 vs 2020 137% 50.8 2% 51.7 130% 0.4 0.7 129% 129% 129% 6.2 8.1 121% 122% 119% 114% 44.2 42.9 111% 2022 2023 March May September November Year end Drug Discovery Regulatory S
Slide 20: Strategic focus – Client type
Strategic focus – Client type BIOTECHS Client type stratification [Q1 2023] Cash position of the TOP 100 biotechnology companies(1) CONTINUATION OF A PROVEN STRATEGY [USD bn] • Offering comprehensive services Median Total 0,8 160 • Expansion and improvement of IDD's offer (new lab space) 54% Biotech
Slide 21: Strategic focus – Key markets
Strategic focus – Key markets Biopharma financing [2022](1) FOCUS ON MARKETS WITH HIGHEST ACCESS TO NEW FINANCING US MARKET Europe • Most of the capital for drug discovery 60.8 and development is allocated USD bn China with the US companies Other • In Europe the UK stands out EUROPE (incl. UK) US 57
Slide 22: 2023 Goals
2023 GOALS STRENGTHENING THE REVENUE BASE NUMEROUS OPTIMIZATION EFFORTS POTENTIAL M&A ORGANIC GROWTH M&A • Strengthening sales structures • Selvita will aim for another acquisition • Intensification of sales to big pharma • Consolidating market is favorable for transactions • Continued expansion of
Slide 23: Infrastructure
» Selvita INFRASTRUCTURE
Slide 24: Continuous investment to expand laboratory infrastructure
Continuous investment to expand laboratory infrastructure JCI, KRAKOW CZT/UAM, POZNAN HONDLOVA, ZAGREB SELVITA RESEARCH CENTRE, KRAKOW 2010: ~550 m2 2017: ~2 500 m2 2022: ~10 900 m2 Since 2023 ~14 300 m2
Slide 25: Construction of the Selvita Research Centre
Construction of the Selvita Research Centre PHASE I 2020 Purchase of the plot of land Preparation of blueprints Securing grant financing 2021-2023 PHASE II Construction works • Additional 4 000 m² of research space and over 250 new workplaces H1 2023 LAUNCH • Expansion of services portfolio, new i
Slide 26: Hexagon – New research facility in Krakow
Hexagon – New research facility in Krakow 4000 m2 > 250 new of research workplaces space for scientists Dedicated to ~500 metres Drug from the Discovery current services laboratories SCIENTIFIC CAPABILITIES • Laboratories for 100+ Medicinal Chemists • In vitro biology facilities • Biochemistry • HCS
Slide 27: Impact on the environment
Impact on the environment Hexagon is equipped with • highly specialized installations to ensure the safety of scientists' work in the labs • pro-environmental solutions to: • reduce the company's energy needs • use natural resources • reduce the negative impact of the environmental transformation fo
Slide 28: Capacity for 1000 scientists on existing Selvita land in Krakow
Capacity for 1000 scientists on existing Selvita land in Krakow • Owned land secures space for 1 000 jobs for scientists in Krakow • Unique know-how gained by the team • Execution of the next stages of expansion will depend on business environment and Selvita growth • Possible financing: grant or le
Slide 29: Polish biotech hub in Krakow
Polish biotech hub in Krakow Faculty of Mathematics and Computer Science New Selvita Research Centre Faculty of Management and Social Communication Faculty of Chemistry Małopolska Centre of Biotechnology Faculty of Geography and Geology Faculty of Biochemistry, Biophysics and Biotechnology AIRPORT:
Slide 30: State-of-the-art facilities with a further potential to expand
State-of-the-art facilities with a further potential to expand Cambridge Poznan Krakow Boston San Francisco Zagrzeb 10 300 m² + 4 000 m² laboratory space Poland & Croatia Hexagon 30
Slide 31: Potential for a New Research Centre in Croatia
Potential for a New Research Centre in Croatia • Purchase of a plot of land in Savski Marof (Q2 2023) • Execution of the expansion will depend on the pace of development and business environment • option to complete space for 500-600 scientists • vicinity of pharma companies • We will be considering
Slide 32: Building an effective global organization
Building an effective global organization Process efficiency optimization, supported by state-of-the-art infrastructure and tools Focused on building: • transparent and smart processes • supported by properly secured, state-of-the-art IT technology, including a well-structured data-base • introducin
Slide 33: Drug Discovery Segment
» Selvita DRUG DISCOVERY SEGMENT
Slide 34: Comprehensive offer of drug discovery & drug development services
Comprehensive offer of drug discovery & drug development services TARGET PRECLINICAL/CLINICAL READY TARGET ID HIT ID HIT TO LEAD LEAD OPTIMISATION VALIDATION CANDIDATE PRODUCTS Genetic and pharmac Assay development Medicinal and synthetic chemistry Non-GLP tox ological approach and screening CADD
Slide 35: Drug discovery services market
Drug discovery services market Global drug discovery Drug Discovery services growth dynamics by Therapeutic Area(1) services market(1) [USD bn] [USD bn] 2021 2026F 14.5% 35 16.4% CAGR 31 9.4 30 CAGR 14.3% 8.7 13, 25 5% 13.5% CA 20 15.2% GR 16 4.8 4.5 10.3% 15 4.1 4.1 11.0% 10 2.4 2.7 2.0 2.0 1.6 5 1
Slide 36: Developments of cancer research
Developments of cancer research Recent novel therapeutics modalities that have The past decade oncology DD major advances expanded the scope of new cancer drug approvals DNA Transcriptomic Small Cell therapy Molecular Targeting CRISPR PROTACs genomics profiling molecules (CAR-T) glues RNA • Current
Slide 37: Ramping up Selvita capabilities in Oncology
Ramping up Selvita capabilities in Oncology ONCOLOGY In vivo models development • The significance of these models lies in the possibility of providing improved understanding of cancer biology and treatment • Solid tumors & hematological malignancies, patient derived animal models TRANSLATIONAL • In
Slide 38: Current developments in the area of infection and inflammation
Current developments in the area of infection and inflammation TRANSLATIONAL IN VITRO IN VIVO • Broadening network of hospitals • Single cell labeling equipment acquired • Significant investment in in vivo imaging for tissue collection systems: PET, CT & bioluminescence • Isolation and characterizat
Slide 39: Implementing the power of AI
Implementing the power of AI Global AI market in drug discovery(1) [mld USD] AI in drug discovery processes 24.6 CAGR 53% • Improving effectiveness of ongoing projects • Opening new options, especially for rare diseases • Process could be faster and cheaper 0.9 = possibility for more new drugs 2021
Slide 40: Increasing AI Participation in Drug Discovery Services
Increasing AI Participation in Drug Discovery Services Our objective: To make all relevant drug discovery and development services supported by AI tools by 2025 based on extensive Selvita drug discovery expertise and AI excellence of Ardigen team in a new model of cooperation • Selvita - internal, b
Slide 41: Selvita's unique value offering
Selvita’s unique value offering CLIENT’S PROJECTS SCIENCE PEOPLE TECHNOLOGIES • Selvita is currently covering small molecules, macrocycles, PROTACs and peptides • In antibodies field we covering analysis aspect • Developing platform Cell and Gene therapies To discover new medicine is an art, which r
Slide 42: Investment in People and Facilities
Investment in People and Facilities Selvita recognizes the importance of investments and secures resources necessary for further growth on all levels, scientific and financial • Strengthening of the team by employment of highly experienced senior scientists with pharma and biotech background • Inter
Slide 43: Summary
» Selvita SUMMARY
Slide 44: Vision: Making Selvita a global CRO leader
Selvita 2025 strategy and beyond Strategy 2022-2025 and perspective for next years • Expanding comprehensive drug discovery • Growing market and development services (drug discovery spending and outsourcing share) • Strengthening presence in key markets (mainly US, UK) • Experience/motivated team •
Slide 45: Thank you for attention
THANK YOU FOR ATTENTION Contact us: [email protected] /SelvitaGroup /company/selvita/ SelvitaKrakow