HUTCHMED (China) Limited · HKEX:13
HUTCHMED (China) — Hutchison China MediTech Limited (Chi-Med) — FY2012 Earnings Presentation
28 slides from HUTCHMED (China)'s earnings presentation, March 2013
Slide 1: 2012 Full Year Financial Results
2012 Full Year Financial Results March 2013 Annual Report -- 2009
Slide 2: Disclaimer
Disclaimer Nothing in this presentation or in any accompanying management discussion of this presentation ("Presentation") constitutes, nor is it intended to constitute: (i) an invitation or inducement to engage in any investment activity, whether in the United Kingdom or in any other jurisdiction;
Slide 3: Agenda
Agenda 2012 Financial Results China Healthcare Division Drug R&D Division Consumer Products Division Review of Key Financial Information 3
Slide 4: Expect strong progress in 2013.
Expect strong progress in 2013. (Unit: US$ millions) (Unit: US$ millions) Group Results 5-Year Trend 2012 2011 Change Sales[1] Net Profit/(Loss)[2] 195.4 3.6 Sales[1] 195.4 165.0 +18% 165.0 0.7 132.1 +18% +412% Operating Profit[1] 12.1 6.8 +79% 107.7 (5.4) 83.0 (7.0) Net Profit/(Loss)[1][2] 6.8 2.1
Slide 5: Momentum in China healthcare and Drug R&D.
Momentum in China healthcare and Drug R&D. (Unit: US$ millions) China Healthcare Division Drug R&D Division Consumer Products Division Sales[1] Revenue 14.8 Sales[3] -9% 350.5 11.1 -50% 10.0 271.0 7.9 231.2 7.4 197.0 +29% 4.8 4.1 155.8 2.2 0.1 0.1 Net profit[2] Net profit/(loss)[2] Net loss[3] 2.8 0
Slide 6: China Healthcare Division
CHI- China Healthcare Division
Slide 7: China pharma growth set to continue – TCM attractive.
China pharma growth set to continue – TCM attractive. Per capita Healthcare Spending Government Healthcare Spending China Pharmaceutical Market (US$ billions) 100 (US$ billions) 92.6 180.0 90 160.0TCM Drugs T CM Drugs 152.4 80 37% CAGR Biotech Drugs USA (2005-2011) 72.0 140.0Biotech Drugs 70 Chemica
Slide 8: Top 15 size TCM company in China – performs well vs. Peers.
Top 15 size TCM company in China – performs well vs. Peers. China Healthcare Division Performance – 2003-2012[1][2] Pas t 3-Year (US$ millions) 03 04 05 06 07 08 09 10 11 12 CA GR (%) Sales 21. 9 27. 9 65. 1 101. 4 119. 0 155. 8 197. 0 231. 2 271. 0 350. 5 21% Sales Growth 27% 133% 56% 17% 31% 26% 1
Slide 9: China Healthcare Division -- established, stable, & diversified.
China Healthcare Division -- established, stable, & diversified. Tightened Tightened working working capital capital Outstanding growth in prescription business Reduced Reduced key distributor distributor inventories Proprietary drug SXBXP[1] sales up 29% to $102.2m. inventories by $3.1m
Slide 10: Strategic direction.
Strategic direction. Sales Growth Continue geographical expansion of existing products in China. Expand GSP[1] distribution operations (complementary 3rd party products). Continued China pharma industry growth well ahead of overall GDP growth. Profit Growth Expand production facilities a
Slide 11: Drug R&D Division
Drug R&D Division 11
Slide 12: China's leading oncology & auto-immune pipeline.
China’s leading oncology & auto-immune pipeline. Balanced financial risk – partners to carry heavy late-stage development investment. Balanced R&D risk – portfolio approach of novel (higher-risk) and validated (lower-risk) targets. Fast track China development – average 60 months[1] – major un
Slide 13: HMPL-004 – Nestlé joint venture
HMPL-004 – Nestlé joint venture [1] [2] HMP view is that Global market for IBD drugs estimated at $7.9 billion in 2012. HMPL-004 can be a First line treatments (only ~50% response) 5-ASAs: Global IBD sales 2012: $1.6 billion (Warner Chilcott $0.8b; Shire $0.7b). ~$1.0 billion drug Non-5-ASA re
Slide 14: Global/China oncology market growing fast – TKIs HMP's focus.
Global/China oncology market growing fast – TKIs HMP’s focus. Global Oncology Market[1] Relevant Targeted Therapies China Oncology Market[6] $54.4b (all US$) Global Sales US Price China Price China Price as China Sales ($billion)[2] ($/month)[3] Product Company Target ($/month)[4] % of US Price ($mi
Slide 15: HMP is a leading innovator in the China TKI arena.
HMP is a leading innovator in the China TKI arena. HMP owns 5 out of 23 (22%) of all small molecule TKIs in development in China. HMP oncology NPV >$450m. HMP’s drug candidates are more selective than most competitors – better targeting, safety/efficacy. PROGRAM COMPANY / TARGET IND SUBMITTED IN
Slide 16: c-Met Programme – Volitinib.
c-Met Programme – Volitinib. c-Met, also known as HGFR, signaling pathway has specific roles particularly in mammalian growth and development. Shown to Novel targeted function abnormally in a range of different cancers. therapy…. c-Met amplification can cause resistance to EGFR kinase inhibitors
Slide 17: VEGFR Programme – Sulfatinib & Fruquintinib.
VEGFR Programme – Sulfatinib & Fruquintinib. [1] Initially began launching in 2005. Global market for VEGFR inhibitor drugs estimated over $10 billion. VEGFR market is fast Small molecule VEGF/VEGFR inhibitors: Sales 2012: $1.0b Sutent™ (Pfizer) and $1.2b Nexvar™ (Bayer). emerging… Monoclonal
Slide 18: VEGFR Programme -- Very positive Fruquintinib Phase I results.
VEGFR Programme -- Very positive Fruquintinib Phase I results. Phase I study initiated in Q1 2011. Phase Waterfall Plot – Tumour size change vs. baseline II initiating in mid-2013. 34 patients[1] with advanced solid tumors change(100%) from baseline (SLD) enrolled and treated in 7 dose cohorts.
Slide 19: EGFR Programme – Epitinib & Theliatinib.
EGFR Programme – Epitinib & Theliatinib. [1] EGFR Market…well Initially began launching in 2003. Global market for EGFR inhibitor drugs estimated over $5 billion. established and Small molecule EGF/EGFR inhibitors: Sales 2012: $1.4b Tarceva™ (Roche) and $0.6b Iressa™ (AstraZeneca). proven… Mon
Slide 20: Strategic direction.
Strategic direction. Evolve Hutchison MediPharma (“HMP”) beyond solely R&D and into an integrated China innovative drug company focused on oncology and immunology with manufacturing and commercial operations. Sensible approach to funding discovery and accelerated clinical operations (“D&C”). L
Slide 21: Consumer Products Division
Consumer Products Division 21
Slide 22: "Healthy Living" consumer products – Attractive Asia market.
“Healthy Living” consumer products – Attractive Asia market. Sales in 2012 of $10.0 million (2011: $11.1m)[1]. 77% of sales, or $7.7 million, in China[2]. Focus on HHO[5]: We have discontinued Sen UK and scaled back Sen France and China infant formula. CHINA – FOCUS MARKET OUTSIDE CHINA Hong Kon
Slide 23: Build scale "Healthy Living" consumer business in Asia.
Build scale “Healthy Living” consumer business in Asia. Market potential for Health & Wellness consumer products in F&B us considerable. Build HHO F&B and personal care business in Asia. Uniquely positioned to develop consumer products business (“FMCG”) in China. Pasta Sauces Herbal Tea Grou
Slide 24: Review of Key Financial Information
Review of Key Financial Information 24
Slide 25: Steady cash position.
Steady cash position. Cash inflow of $8.2 million during 2012. Established Chi-Med holding company level loan facilities totaling ~$61.7 million ($34.8m revolving lines and $26.9m 3-year term loan), as at end 2012 we had drawn down ~$37.8 million . Cash and cash equivalents and unutilised bank
Slide 26: Working capital and CAPEX.
Working capital and CAPEX. Working capital improved due mainly to reduction in raw material inventories (stockpiled in 2010 during period of rapid raw material price escalation) and tighter control on trade payables at year end. CAPEX being tightly controlled as we evaluate plans to relocate and
Slide 27: Key financial ratios.
-5% Key financial ratios. -9.4% -15% -16.4% Equity[1] Return on-19.3% Return on Assets[1] -25% 102007 112008 12 2009 10 11 12 9.7% 3.3% 3.3% 1.1% Improved Improved -3.4% by 6.4% by 2.2% -9.0% Earnings/(Loss) Per Share[1] Debt to Equity Ratio 10 11 12 54.0% 46.4% -5% 41.1% 0.13 -9.4% 0.04 -15% 12.5%
Slide 28: Thank you
CHI: MED Thank you
Hutchison China MediTech Limited (Chi-Med) — FY2012 Earnings Presentation on 6ix