Cochlear Limited · ASX:COH
Cochlear — Merger or Acquisition (March 2005)
24 slides from Cochlear's merger presentation, Mar 4, 2005
Slide 1: The world leader. Cochlear
‘0 Nl The world leader. (eC Cochlear
Slide 2: Acquisition of Entific Medical Systems AB Investor Briefing Materials
Cochlear Limited Acquisition of Entific Medical Systems AB Investor Briefing Materials Chris Roberts, CEO Neville Mitchell, CFO John Parker, CTO 04 March 2005 2
Slide 3: Disclaimer
Disclaimer Forward looking statements The forward looking statements included in these materials involve subjective judgment and analysis and are subject to significant uncertainties, risks, and contingencies, many of which are outside the control of, and are unknown to Cochlear Limited (“Cochlear”)
Slide 4: Agenda
Agenda Transaction Overview Overview of Entific Strategic Rationale Financial Impact Summary 4
Slide 5: Transaction Overview
Transaction Overview Cochlear Limited has signed an agreement to acquire Entific Medical Systems AB (“Entific”) for SEK1,050M (~A$195M) — Enterprise value of ~A$175M — Entific is a Swedish based company specialising in treating conductive hearing loss and single sided deafness using a unique technol
Slide 6: Agenda
Agenda Transaction Overview Overview of Entific Strategic Rationale Financial Impact Summary 6
Slide 7: Overview of Entific
Overview of Entific — Spin-off from dental implant company, Nobel Biocare in Baha® 1999 — Titanium implant system with osseointegration technology – Baha® – direct bone conduction hearing implants primarily used for the treatment of conductive hearing loss and single sided deafness – Anchoring syste
Slide 8: Overview of Hearing and Hearing Impairment
Overview of Hearing and Hearing Impairment Sensorineural hearing loss Conductive hearing loss 8
Slide 9: Direct Bone Conduction Technology
Direct Bone Conduction Technology Baha® System Cochlea Bone Conduction 9
Slide 10: Core Aspects of the Baha Implant System
Core Aspects of the Baha® Implant System Snap Coupling Abutment Transducer Osseo- integration 10
Slide 11: Baha for Conductive Hearing Loss
Baha® for Conductive Hearing Loss Left Right Direct Bone Conduction Air Conduction from Baha® normal way 11
Slide 12: Baha for Single Sided Deafness
Baha® for Single Sided Deafness Left Right Direct Bone Conduction Air Conduction from Baha® normal way 12
Slide 13: "Coffee Break" Surgery Through Innovative R&D
“Coffee Break” Surgery Through Innovative R&D — Surgery is low risk, reversible and relatively simple — Implants are MRI safe 13
Slide 14: Significant Unmet Clinical Need
Significant Unmet Clinical Need Conductive hearing loss and single sided deafness — Both niche but important growth markets Conductive hearing loss (CHL) — Mild conductive hearing Loss – Normally not treated — Moderate conductive hearing loss – Surgery (stapedectomy, reconstruction of eardrum or the
Slide 15: Target Markets
Target Markets Conductive hearing loss Sensorineural hearing loss Mild to moderate Mild hearing loss ≥Moderate hearing loss ≥Severe hearing loss hearing loss Unilateral Bilateral Unilateral Bilateral conductive conductive sensorineural sensorineural hearing loss hearing loss hearing loss hearing los
Slide 16: Strong Revenue Growth
Strong Revenue Growth 212 5 % 169 : 38. GR CA ~6,300 units 121 96 56 42 1999 2000 2001 2002 2003 2004 SEK in millions. December year end. 16
Slide 17: Entific Revenue Split
Entific Revenue Split 2004 Revenues by Business 2004 Revenues by Region Baha® 91% Europe 58% North America 36% International Facial Prostheses 7% Anchors 9% 17
Slide 18: Agenda
Agenda Transaction Overview Overview of Entific Strategic Rationale Financial Impact Summary 18
Slide 19: Strategic Rationale
Strategic Rationale — Huge potential for implantable solutions for hearing impaired — Acquisition broadens Cochlear’s range of implantable hearing solutions with strong footprint in – Conductive hearing loss (CHL) – Single sided deafness (SSD) — Highly complementary “bolt-on” acquisition — Synergies
Slide 20: Agenda
Agenda Transaction Overview Overview of Entific Strategic Rationale Financial Impact Summary 20
Slide 21: Financial Impact on Cochlear
Financial Impact on Cochlear — Transaction expected to close in March ‘05 — Accounts will reflect Entific results from 01 Jan ‘05 — Immediately accretive to cash EPS — ~5% accretive to cash EPS in FY2006 — Previous Cochlear FY05 PAT guidance confirmed (Core PAT of A$53-55M - i.e. pre-Entific goodwil
Slide 22: Agenda
Agenda Transaction Overview Overview of Entific Strategic Rationale Financial Impact Summary 22
Slide 23: Summary
Summary — Cochlear is acquiring Entific for an enterprise value of ~A$175M — Entific is the world leader in bone anchored systems for treating conductive hearing loss and single sided deafness — Entific has demonstrated strong growth and financial performance since its 1999 spin off from Nobel Bioca
Slide 24: Hear now. And always Cochlear
Hear now. And always Cochlear i.