Coloplast A/s Class B · OMXCOP:COLO_B
Coloplast A/s Class B — Investor Presentation (August 2005)
46 slides from Coloplast A/s Class B's investor presentation, August 2005
Slide 1: Coloplast A/S Investor presentation
Coloplast A/S Investor presentation
Slide 2: Coloplast
2 Coloplast Coloplast products and services help patients achieve greater independence from medical challenges in 5 areas: Ostomy care, continence care, wound care, skin care and breast care. 39%* 24% 12% 5% 7% *Percentage of total group sales (2003/04)
Slide 3: History of revenue growth 1957-2004
3 History of revenue growth 1957-2004 7000 6000 5000 Forward integration 4000 Acquisitions mDKK 3000 Product divisions and subsidiaries 2000 Danish production and sale through 1000 distributors 0 57 62 67 72 77 82 87 92 97 02 19 19 19 19 19 19 19 19 19 20
Slide 4: Sales and production world wide
4 Sales and production world wide Sweden Switzerland Canada Germany Denmark Hungary Argentina Belgium France Poland Australia Italy Norway USA China Costa Rica Austria Japan Great Britain Holland Spain Portugal Croatia Czech Republic Israel Russia Slovakia Slovenia South Africa Brazil
Slide 5: Geographical distribution
5 Geographical distribution Revenue 2003/04 13% 6% 81% Europe The Americas ROW
Slide 6: Innovation rate
6 Innovation rate* 35 30 25 % of sales Group 20 target 15 10 5 0 98/99 99/00 00/01 01/02 02/03 03/04 * Share of products in sales with less than 4 years of age
Slide 7: Macro trends
7 Macro trends Health care Power to Trend Demographics reforms distribution Description Population aged Health care budget The major 60 or older is constraints… distributors grow growing steadily in their share... Europe, Asia and … lead to the need North America… for cost ...through both containmen
Slide 8: Market conditions and response
8 Market conditions and response 1. Reimbursement changes Market growth influenced by: • Monitor/influence policy • Earlier cancer detection • Product design • Improved surgical procedures • Emphasis on clinical • Increased longevity documentation • New technologies and treatment alternatives 2. Pri
Slide 9: Three key customers
9 Three key customers • The end customer • The user, primary concern is quality of life • The health care professional • The advisor, primary concerns are user quality of life and handling • The payer • Concern is primarily product pricing
Slide 10: Turnover by business area and competitor overview
10 Competitor overview Total corp. % of total 4% 67% 20% ½% 12% ¼% 80% Turnover by business area (DKKm) Skin care Wound care Continence care Ostomy care N r J st r ch c te to J& S& Te la lis Te en op va ol M ra ol on H st C C A
Slide 11: Business Structure
11 Business Structure Group Management Corporate functions Chronic care segment SBU segment V o Sales Ostomy Continence Wound Skin Breast l care care care health care u m e Europe, North p r Europe, o South d u c Americas t i o RoW n
Slide 12: Ostomy care - for discreet protection
12 Ostomy care - for discreet protection • Normal function of bowel or bladder lost • Almost 80% related to cancer • Designed for security, skin-friendliness, discretion, ease of use and comfort • Wide variety of bags, plugs and accessories
Slide 13: Ostomy care - market data
13 Ostomy care - market data Global market value DKK 8-8½bn Europe (>4bn) USA (<2bn) Global (>8bn) 6% 2% 10% 5% 28% 35% 27% 24% 39% 55% 37% 4% 28% ConvaTec Coloplast Hollister B Braun Other Note: Only markets where Coloplast is present are included
Slide 14: Continence care - for independent living
14 Continence care - for independent living • Spinal cord injured, multiple sclerosis, spina bifida • Discreet and easy-to-use solutions • Catheters, urine bags, urisheaths, bowel management, absorbent products
Slide 15: Continence care - market data
15 Continence care - market data Product Market Coloplast market Coloplast Main area size share (Europe) growth competitors 1.5bn DKK 43% 15-20% Astra Tech, Porges/Mentor, 15% Rüsch, Rochester, B Braun 1.2bn DKK 30% (value) 5% Bard, Hollister, Mentor, B Braun, 0-5% Manfred Sauer, Unomedical 0.5bn DK
Slide 16: Chronic care - US market positioning and key goals
16 Chronic care - US market positioning and key goals • Strong product portfolio • Convex baseplate, EasiClose • Market access through GPO/IDN • Consorta • Large number of IDN contracts • Significant growth in new patient discharge • Sustained OC hospital growth > 30% • Sustained OC/CC growth > 20%
Slide 17: Chronic care - US market value
17 Chronic care - US market value Ostomy market value 280mn USD Continence market value 370mn USD Coloplast Other 4% 2% Holl CvT 38% 56% Intermittent Coated Catheters estimated value potential 60 mill. USD, 16% of total CC
Slide 18: Chronic care - US patient path
18 Chronic care - US patient path Medical product manufacturer GPO Direct sales, wholesalers and specialised home care providers Distribution 2-5 Days 30-90 Days 90 Days - 20 Years Hospital Home Health Agencies Retail DME Patient path New patient Convalescent patient Patient at home (at home or in l
Slide 19: Home care value chain
19 Home care value chain Hospitals Active distribution Home Coloplast Subs. care Innovation Relationship Value Proposition Passive distribution Wholesaler Pharmacy
Slide 20: Coloplast home care activities
20 Coloplast home care activities German market leader in active distribution. Distributing 1/3 of all ostomy bags in Germany. Ownership majority since 2001. Distribution of ostomy, continence care and wound care products in the UK. Cutting service for ostomists. Internal merger of Coloplast Direct
Slide 21: Effects of changing market conditions in Germany
21 Effects of changing market conditions in Germany CC draft for CC final Implementation of new prices decision health care reform CC final decision Market conditions Introduction of postponed patients‘ co-payment OC draft for for medical devices new prices OC final decision Reimbursement on auxilia
Slide 22: German market impact on Coloplast
22 German market impact on Coloplast • Reform impacts 1-1.2bn DKK turnover (ostomy and continence care) • Coloplast is German market leader in ostomy • HSC is German market leader in distribution - distributing 1/3 of all ostomy products • Activities will be aligned to changed market conditions from
Slide 23: Wound care - providing better outcomes
23 Wound care - providing better outcomes • For difficult to heal wounds • leg ulcers, pressure sores, diabetic ulcers • Primarily affects the elderly • Portfolio of advanced, active dressings • Education, information and service
Slide 24: Wound care - market definition
24 Wound care - market definition Wound type Acute Chronic Dry wound € 1.0 billion € 1.5 billion healing Product technology € 1.1 billion segment, growth 9-11% Moist wound € 0.5 billion € 1.0 billion healing Active Pharma and biotech € 0.1 billion € 0.4 billion VAC € 0.4 billion € 0.1 billion Compre
Slide 25: Wound care - market shares in Europe
25 Wound care - market shares in Europe MWH and active products 21% 27% Convatec S&N Coloplast J&J Mölnlycke Others 10% 11% 17% 14% Technology Traditional Advanced Active ConvaTec X X S&N X X Coloplast X X J&J X X X Mölnlycke X X
Slide 26: Skin health - for medical and personal use
26 Skin health - for medical and personal use • To treat skin problems arising from medical conditions or related to frequent hand washings • Designed for cleansing, moisturising, protection and treatment • Skin health includes US wound care sales • 3/4 of SBU turnover generated in the US
Slide 27: Skin health - product positioning
27 Skin health - product positioning CLINICIAN PATIENT INTERVENTIONS ALL PATIENTS Bathing Moisturising Intact Skin Risk Factors - Dry skin - Immobility - Incontinence Hand hygiene + Cleansing + Barriers Intact Skin Skin breakdown + Wound cleansing + Wound care Skin repair INTACT SKIN
Slide 28: Skin health - competitors
28 Skin health - competitors 4bn DKK US market Wound 100 80 Product mix (%) 60 40 20 Skin 0 0 20 40 60 80 100 Sales setting (%) Long-term care Acute
Slide 29: Breast care - for peace of mind
29 Breast care - for peace of mind • Attached, lightweight and soft breast forms, partial breast shapers, lingerie and swimwear • Breast cancer affect approx. 10% of women
Slide 30: Breast care business case
30 Breast care business case 1bn DKK global market Segmentation by product group • 45% total market share Coloplast sales value (breastforms, partials, textiles) Breast Others Forms • >50% market share for breast Swimwear forms • 50/50 sales value split between Bras US and Europe Partials Competitor
Slide 31: Expectations and targets
31 Expectations and targets 2004/05 • Sales growth of 8-9% in local currencies • Profit margin 15-16% 2008 • Sales exceeding DKK 9 billion through organic growth • Profit margin (EBIT) reaching 18% • ROAIC of 20% • Acquisitions and divestments
Slide 32: Key figures Q3 2004/05
32 Key figures Q3 2004/05 9 months 9 months Index vs mDKK 2004/05 2003/04 2003/04 Revenue 4,786 4,468 107 EBIT 699 749 93 Special items -19 0 - Financial items -73 -87 84 Profit before tax 607 662 92 Tax -192 -226 85 Minority interests -1 -3 33 Group profit 414 433 96 Profit margin 15% 17% -
Slide 33: Growth Q3 2004/05
33 Growth Q3 2004/05 - local currencies Growth Growth Growth Est. market Q3 2004/05 H1 2004/05 Q1 2004/05 growth Ostomy Care 9% 9% 9% 2-6% Continence Care 10% 9% 8% 5-8% Chronic Care segment* 9% 8% 6% Wound Care 9% 8% 4% 9-11% Skin Health 8% 7% 12% 9-12% Breast Care 4% (1)% (3)% (3)-(1)% SBU segment
Slide 34: Highlights markets
34 Highlights markets Ostomy Care continues to outperform market growth - Solid US and RoW growth, restructuring in Germany - Corsinel well accepted, Strong Easiflex growth Continence Care growth by 10% - SpeediCath Compact still fuelling growth - New reimbursement prices in Germany expected in 2006
Slide 35: Profit and margins - how to reach 18%
35 Profit and margins - how to reach 18%… mn % • Relocation 1200 17 - Hungary and China 1000 16 15 800 • Efficiency projects / abc 14 600 13 • SBU margin improvement 400 12 • Economies of scale 200 11 0 10 99/00 00/01 01/02 02/03 03/04 EBIT EBIT %
Slide 36: Volume production
36 Volume production Product life cycle stages Sales Maturity Growth Decline Introduction and development Time
Slide 37: Tatabanya, Hungary
37 Tatabanya, Hungary • 700 headcounts by Aug. 2005 • Construction completed • DKK 1.5bn sales value in 2005/06 • EBIT up 5% compared to Danish manufacturing Coloplast, Phase I-III, Tatabanya, Hungary • Phase I - finalised: ostomy bags, urisheaths • Phase II - finalised: ostomy bags, dressings, cath
Slide 38: Coloplast's total staff requirements by geography
38 Coloplast’s total staff requirements by geography Total staff requirements (FTEs) by geography, 2003/04-2010/11 2.000 1.500 DK FTEs 1.000 HU CN 500 0 4 5 6 7 8 9 0 1 /0 /0 /0 /0 /0 /0 /1 /1 03 04 05 06 07 08 09 10 20 20 20 20 20 20 20 20
Slide 39: Cash flow
39 Cash flow 1500 1000 500 Acquisitions mDKK Investments 0 Cash flow -500 Free cash flow 5 1 7 8 9 0 2 3 4 /0 /0 /9 /9 /9 /0 /0 /0 /0 04 00 96 97 98 99 01 02 03 3Q -1000 -1500
Slide 40: Oil prices
40 Oil prices • Energy consumption • Fixed price contract 2006-2008 • Cost of goods sold • Polymer raw material price increase • Transportation of goods • Diesel oil price increase
Slide 41: MMS
aT MMS | MNES ee wp Coloplast
Slide 42: Coloplast consolidated figures
42 Coloplast consolidated figures As per 30 September 2004 mDKK 99/00 00/01 01/02 02/03 03/04 Net turnover 3,556 4,018 5,567 5,610 6,069 EBITDA1 720 878 1,157 1,206 1,295 Operating profit 498 618 875 909 988 Net financial expenses2 48 31 60 21 89 Coloplast’s share of profit for the year 292 405 768
Slide 43: Coloplast key financial ratios
43 Coloplast key financial ratios As per 30 September 2004 99/00 00/01 01/02 02/03 03/04 Profitability Operating profit margin 14 15 16 16 16 EBITDA margin 20 22 21 21 21 Coverage EBITDA/Net interest, ratio 48 44 14 17 13 Leverage Net debt/EBITDA, ratio 46 128 127 122 113 Total debt/total capitalisa
Slide 44: Investments - tangible assets
44 Investments - tangible assets 700 600 500 400 mDKK 300 200 100 0 -100 97/98 98/99 99/00 00/01 01/02 02/03 03/04 Plant & machinery Land & buildings Adjustment, tangible assets under construction
Slide 45: 5 year share price development
45 5 year share price development
Slide 46: Shareholders as per 30 September 2004
46 Shareholders as per 30 September 2004 A-shares B-shares Owner- Voting 1,000 1,000 ship, % rights, % units units Holders of A-shares 1,800 8,839 44.3 66.8 Danish instit. investors 4,390 18.3 10.9 Foreign instit. investors 5,960 24.8 14.8 Coloplast A/S* 592 2.5 - Other shareholders 2,014 8.4 5.0 No