Straumann Holding Ag · SIX:STMN
Straumann — Debt Investor Presentation (April 2013)
39 slides from Straumann's debt investor presentation, Apr 4, 2013
Slide 1: Being the partner of choice
Being the partner of choice Thomas Dressendörfer, CFO Inaugural CHF Bond Roadshow Basel/Zurich, 4 April 2013
Slide 2: Disclaimer
Disclaimer This presentation contains certain “forward-looking statements”, which can be identified by the use of terminology such as “will”, “guidance”, “would”, “prevailing”, “still be able to”, “should”, “confidence in achieving”, “turnaround”, “future”, “anticipated”, “continue”, “mid and long t
Slide 3: Straumann in a nutshell
Z straumann Straumann in a nutshell COMMITTED TO SIMPLY DOING MORE FOR DENTAL PROFESSIONALS
Slide 4: To be the partner of choice
«To be the partner of choice» Straumann is a global leader in implant and restorative dentistry and oral tissue regeneration A pioneer of dental implants that offers ‘Swiss’ quality and scientific innovation for more than 50 years Annual revenue of just under CHF 700 million with a respective Ebit m
Slide 5: Half a century of science-based innovation and precision engineering
Half a century of science-based innovation and precision engineering 1954 – 1970 Since 1990 1970 – 1990 Material testing Dental medical Medical devices and research devices 1974 First Straumann Dental implant Straumann 5
Slide 6: Significant business developments since IPO in 1998
Significant business developments since IPO in 1998 2007 – Restorative and digital dentistry 2002 – Regenerative dentistry 1974 - Implant dentistry Straumann 6
Slide 7: Straumann serves three dental specialty segments
Straumann serves three dental specialty segments... CADCAM restorations CADCAM on natural teeth restorations on implants Regeneratives Dental implants & abutments Straumann 7
Slide 8: …and offers 'bone to tooth' solutions
…and offers ‘bone to tooth’ solutions Total Market Straumann Main Segment size market size position /share active since competitors (share of sales) CHF 3.0bn1 No. 1 1970 Nobel Biocare, Abutments Dentsply, 18% Biomet 3i, Zimmer ~90% Dental implants Dental Implants & stock abutments CHF 0.4bn No. 4 2
Slide 9: Why does CADCAM matter for Straumann?
Why does CADCAM matter for Straumann? Digitalization will further change value chain for companies & workflows for dentists and labs Surgical planning and prosthetic (i.e. crown) design software will converge Enabler: Implant companies that offer full ‘bone-to-tooth’ solutions will have an advantage
Slide 10: A global footprint…
A global footprint… Straumann subsidiaries Production plants Distributors Present in >70 countries through 23 fully-owned sales subsidiaries and a broad distributor network Straumann 10
Slide 11: …with dedicated production sites
…with dedicated production sites Malmoe (S) Markkleeberg (D) regenerative products CADCAM milling Graefelfing (D) CADCAM scanner assembly Andover (USA) Villeret (CH) implant system implant system Arlington (USA): CADCAM milling Straumann 11
Slide 12: Straumann's shareholder structure
Straumann’s shareholder structure (on 31 December 2012) Non- Non- registered registered 17.6 17.6 ROW 0.3 Major private shareholders USA 1.9 Private 38.1 individuals Europe 9.1 11.0 Switzerland 56.8 Asia 14.2 Other institutional Major shareholders institutional 16.5 shareholders 16.8 Major sharehold
Slide 13: Fundamentals intact – emerging markets with attractive growth profile
Fundamentals intact – emerging markets with attractive growth profile
Slide 14: The opportunity and the challenge: meeting a huge medical need
The opportunity and the challenge: meeting a huge medical need More than a quarter of a billion people in the industrialized world alone are missing one or more teeth; up to 1/3 of people over 65 have no teeth 59% of the 45-54 year olds and 33% of the <35 have lost at least 1 tooth1 Only ¼ seek trea
Slide 15: A global market yet to unlock
A global market yet to unlock Dental implants per 10 000 population in 20111 Top3 200 193 100 0 KR IT ES CH DE SE BR FR US JP UK CN Today, in most countries, the number of implants placed annually is >50% lower than the average of the three highest-penetrated countries 1 Straumann estimates, based
Slide 16: US example: implant penetration rising to 25-30%
US example: implant penetration rising to 25-30% Adult population People affected by tooth loss: Oral hygiene / dental awareness / 45-55% nutrition / aging population / education Annual tooth loss cases seeking treatment: ‘Pain Level’ / economics / access to 5-10% treatment / reimbursement / awarene
Slide 17: Emerging markets have gained share rapidly
Emerging markets have gained share rapidly 2004 2011 2015E 19% 28% 35% Luxury 65% watches 72% 81% 16% 48% 42% Automotive 52% 58% 84% 10-15% 20-25% 35% Dental 65% implants 75-80% 85-90% Emerging markets Developed markets Emerging market definition according to MSCI; market split by value. Straumann
Slide 18: All BRIC countries will become top healthcare markets by 2020
All BRIC countries will become top 12 healthcare markets by 2020 Anticipated growth in healthcare costs 2000 Rank 2010 Rank 2020 Rank between 2010-20 US US US 12% Japan Japan China 10% Germany Germany Japan 8% France France Germany 6% Italy China Brazil 4% UK UK France Average Canada Italy UK 2% Chi
Slide 19: Brazil has an attractive growth profile
Brazil has an attractive growth profile Dental implant market size (value) Source: MRG 2010, Fundação Getulio Vargas, Ernst & Young, McKinsey Global Institute, BCG, Straumann US Census Bureau; Straumann estimates. 19
Slide 20: Neodent impresses in 2012 and offers exciting opportunity in South America
Neodent impresses in 2012 and offers exciting opportunity in South America Net revenue 20121 Growth BRL 196m +17% (approx. CHF 93m) EBITDA >40% Net profit Margin BRL 53m 27% Straumann holds a 49% stake in Neodent with an option to increase to 100%. IFRS consolidation expected in 2015. Straumann Ma
Slide 21: How a full combination would look
How a full combination would look Straumann Neodent Pro forma1 RoW 4% <5% ROW 2% LATAM APAC 13% 15% APAC 15% North Europe Europe America 55% 50% 25% North LATAM America 95% 20% Combination allows Straumann to participate in future growth markets Option to increase to 100% over next five years
Slide 22: Recent developments & Financial performance
Recent developments & Financial performance
Slide 23: What is happening in the markets?
What is happening in the markets? Weak economy in Europe Dampened consumer confidence Patients postponing complex treatment or taking cheaper/inferior options Growth potential in North America intact Slow patient traffic Fundamentals intact Asia: mixed picture Strong growth in China Sluggish Japan d
Slide 24: What is happening in the markets? Straumann's response
What is happening in the markets? New technologies enable full digital procedures with optimized materials (improved esthetics, durability, pre-shaded) No threat from new technologies expected Increased competition from low-cost/inferior alternatives including conventional tooth replacement Dental l
Slide 25: Above-average performance in a challenging market
Above-average performance in a challenging market 25% 20% 15% 10% 5% 0% -5% -10% -15% Straumann organic growth 1 Market for tooth replacement & restoration (leading implant companies) 1 Market share weighted growth rates (l.c.) of Biomet/3i, Dentsply, Nobel Biocare, Straumann and Zimmer; Straumann
Slide 26: Performance on like-for-like basis
Performance on like-for-like basis in CHF million FY 2011 FY 2012 Change Reported excl. FX adjusted Reported excl. vs. adjusted 1 1 exceptionals exceptionals Revenue 693.6 693.6 697.5 686.3 686.3 (1.6%) excl. iTero discontinuation (1.0%) 528.5 528.5 531.9 531.5 534.4 Gross profit Gross profit margin
Slide 27: Adapting from growth to cost optimization and selective expansion
Adapting from growth – to cost optimization and selective expansion REVENUE KEY DRIVER 2012 GROSS MARGIN CHF 686m +6% (l.c.) 78% Promising start to 2012 Solid growth in North America Efficiency gains Market slowed from Q2 partly offset slow Europe (-5% l.c.) Margin expanded OPERATING INCOME MARGIN1
Slide 28: Despite heavy FX headwind, strong gross margin - OPEX rightsizing underway
Despite heavy FX headwind, strong gross margin - OPEX rightsizing underway In CHF million 79.7% 79.6% 77.9% 76-78% 76.2% up to 29.6% 28.7% 30.0% 22.7% 19.0% 2009 2010 2011 2012 Vision 2020 Gross margin EBITDA 1 All figures pre-exceptional figures Straumann 28
Slide 29: Solid cash generation
Solid cash generation in CHF Mio. 400 377 (266)2 300 200 115 141 (58) 100 (27) 0 Cash & Acquisitions Dividend CAPEX Operating Cash & equivalents & others cash equivalents January '12 Dec '12 1 All figures pre-exceptional figures Straumann 2 Investments in Neodent and Dental Wings 29
Slide 30: Debt free and solid cash generation
Debt free and solid cash generation CASH & EQUIVALENTS EBITDA1 NET DEBT/EBITDA CHF 141m CHF 130m -1.08x Mostly held centrally at the HQ; Or 19% of revenues. Solid Conservatively financed with a 1st tranche (49%) of Neodent profitability level despite strong net cash position acquisition financed thr
Slide 31: Building for the future
Z straumann Building for the future COMMITTED TO SIMPLY DOING MORE FOR DENTAL PROFESSIONALS
Slide 32: The drivers of our industry
The drivers of our industry Demographics Patient awareness on esthetics & quality of life Increasing acceptance Dentist training & experience Straumann 32
Slide 33: Implant market assumed to grow in high single digits
Implant market assumed to grow in high single digits Implant dentistry market1 value (in CHF bn) 2011 2020 CAGR 2011-20 ~3.5 6-8 6-10% Main threat to long-term market growth in implant dentistry is the possibility of another global recession between now and 2020 (lower range estimate) 33 1 Includes
Slide 34: The building blocks of our strategy
The building blocks of our strategy Acceleration by extending business Extension of scope scope Defined growth Acceleration by capturing additional initiatives1 growth opportunities Based on market growth and our ability Base to outperform our market segment 1 Growth initiatives include regional str
Slide 35: Straumann and the ITI – a unique collaboration in evidence-based dentistry
Straumann and the ITI – a unique collaboration in evidence-based dentistry Founded in 1980, the ITI is the world‘s largest implant dentistry network exceeding 13 000 members in 95 countries Straumann is exclusive implant manufacturing partner Thousands of training courses each year covering all leve
Slide 36: Envisioned key financials and regional mix in 2020
Envisioned key financials and regional mix in 2020 Net revenue Gross margin EBIT margin (CHF) up to >1.5bn ~76–78% 25% 2020 2011 up to Europe ~ 76-78% 25% NAM APAC LATAM & ROW STRAUMANN CMD 2012 Copyright Straumann. All rights reserved. 36
Slide 37: Key points in brief
Key points in brief Growth fundamentals are intact; existing markets provide attractive opportunities ‘Vision 2020’ provides a valuable roadmap for the future Straumann has already started implementation, through a redesigned organization, tailored regional strategies and a portfolio of innovative s
Slide 38: Questions?
Z straumann COMMITTED TO SIMPLY DOING MORE FOR DENTAL PROFESSIONALS
Slide 39: Straumann's currency exposure
Straumann’s currency exposure Transaction exposure hedged for up to max 12 months Reduction of currency risk through natural hedges where possible Increase purchasing in foreign currencies Translation risk not hedged Net revenue Cost breakdown1 breakdown CHF CHF 11% 47% Other EUR 21% 41% EUR 21% Oth
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