PDF of presentation - Acino

Acino – Delivering Health
Half-year Report 2012
Peter Burema, CEO
Walter Saladin, CFO
Acino Holding Ltd.
Erlenstrasse 1 | CH-4058 Basle | www.acino-pharma.com
Phone +41 61 338 60 00 | Fax +41 61 338 60 80

Performance H1-2012
Basle, August 2, 2012
Walter Saladin, CFO Acino Group
Acino Holding Ltd.
Erlenstrasse 1 | CH-4058 Basle | www.acino-pharma.com
Phone +41 61 338 60 00 | Fax +41 61 338 60 80

H1-2012 key financials
(in EUR million) H1-2012 H1-2011 Change
Revenue 128.9 65.2 98%
EBITDA
% of revenue
EBITDA comparable (1)
% of revenue
EBIT
% of revenue
EBIT comparable (1)
% of revenue
Net profit
EPS (diluted)
Net profit comparable (1)
EPS (diluted)
Cash flow from operations
% of revenue
16.8
13.0%
23.4
18.2%
3.4
2.6%
10.0
7.8%
3.1
0.90
9.4
2.79
(1.6)
(1.3%)
11.7
18.0%
11.7
18.0%
2.8
4.3%
2.8
4.3%
2.4
0.76
2.4
0.76
5.3
8.2%
Equity ratio in % as of June 30 54% 78%
(1) Without acquisition related one time items
43%
99%
20%
257%
27%
293%
-70%
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H1-2012 operating performance
Net sales
Cost of goods / Change in inventory
Employee benefits
Other Opex
EBITDA
Depreciation and Amortization
EBIT
Net financial result / Income Taxes
Net profit
(in EUR million)
3.4
2.8
0.5
0.9
3.1
2.4
13 . 3
16 . 8
11. 7
13 . 4
7.8
23.2
20.3
30.1
35.5
51.9
65,2
13.0% of sales
18.0% of sales
2.6% of sales
4.3% of sales
128.9
0 20 40 60 80 100 120 140
H1-2011 H1-2012
+ 98%
+ 123%
+ 44%
+ 20%
+27%
4

H1-2012 comparable operating
performance (1)
Net sales
Cost of goods / Change in inventory
Employee benefits
Other Opex
EBITDA
Depreciation and Amortization
EBIT
Net financial result / Income Taxes
Net profit
(1) Without acquisition related one-time items
(in EUR million)
10 . 0
2.8
0.6
0.9
11. 7
13 . 4
7.8
9.4
2.4
13 . 3
23.2
20.3
23.4
29.2
35.5
44.0
18.2% of sales
18.0% of sales
3.7% of sales
65.2
12 8 . 9
0 20 40 60 80 100 120 140
H1-2011 H1-2012
+ 98%
+ 90%
+ 99%
7.8% of sales + 257%
7.3% of sales
+ 293%
5

H1-2012 EBITDA
acquisition related one-time items
EUR
million
25
23
21
19
17
15
13
11
9
7
5
3
1
‐1
‐3
‐5
Actual
EBITDA
16.8
13.0% of sales
Set-off of step-up
inventory
8.0
Purchase bargain /
negative good will
(2.2)
One-off cost
acquisition
0.9
Comparable
EBITDA
23.4
18.2% of sales
6

H1-2012 Net profit
acquisition related one-time items
EUR
million
11
9
7
5
3
1
‐1
Actual
net profit
3.0
EPS diluted
0.90
One time items
above EBIT
6.7
One-off cost financing
(syndicate loan and
capital increase)
1.4
Comparable tax
effect on one
time items
(1.7)
Comparable
net profit
9.4
EPS diluted
2.76
7

H1-2012 cash flow
(EUR million) H1-2012 H1-2011
Cash flow 17.7 (2.4)
Changes in working capital (19.3) 7.8
Cash flow from operations (1.6) 5.3
Cash flow from investing
� PPE
� Intangible assets
� Acquisition
� Associated companies
Cash flow from financing
� Proceeds from syndicate loan
� Capital increase
� Repayment short term borrowing
� Other
(5.8)
(5.4)
(80.0)
(1.0)
100.0
20.3
(13.0)
(2.9)
(92.4)
104.5
(8.9)
(4.9)
(13.7)
(6.4)
Net change in cash 10.5 (14.8)
Free cash flow (13.0) (8.4)
(6.4)
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Balance sheet
EUR
million
30.6.2012
EUR 515.3 million +56%
14,9
144,6
24,5
103,6
71,0
20,0
26,9
74,3
114,6
279,5
H1-2012
ASSETS
• Ongoing high investments Miesbach
• PPA acquisition (PPE, intangible
assets, working capital)
• Goodwill unchanged due to favorable
acquisition terms
LIABILITIES AND SHAREHOLDERS’
EQUITY
• New Syndication loan
• Higher other liabilities and deferred
taxes
EQUITY RATIO
• Reduced due to acquisition but still
high 54 %
156,7
Assets Liabilities &
Shareholders‘
equity
Deferred revenues
Deferred tax liabilities
Other liabilities
Financial liabilities
Shareholders’ equity
Cash and cash equivalents
Working capital
Other non-current assets
Other intangible assets
Goodwill
Property, plant & equipment
102,5
Assets
31.12.2011
EUR 330.4 million
4,4
53,8
18,8
79,9
71,0
20,5
13,3
26,2
13,0
257,4
Liabilities &
Shareholders‘
equity
9

New segment reporting according to
3 Pillar Strategy
BtC
BtB
Brand marketing Acino Switzerland
Currently 80 countries in Middle East,
Africa, LATAM, Asia
Currently 46 products available
Brand approach: High Swiss/EU quality
Brand transfer from Mepha to Acino
Switzerland within 2 years from acquisition
Main countries: Saudi Arabia, Iraq, UAE,
French West Africa, Ecuador
Acino own developments, Acino owns IP
Outlicensing to leading pharmaceutical
companies
Niche products / technologically complex
formulations
Main products: oxycodone, metoprolol,
doxazosin, alfuzosin, clopidogrel,
buprenorphine
Main customers: Teva, Stada, Novartis,
Mylan, Dr. Reddy’s
Technology Marketing
Based on Acino’s strong and leading
technology platforms
Partnerships /co-developments with leading
pharmaceutical companies
- Drug delivery solutions for new NCE’s
- Life cycle management
Contract manufacturing / customer usually
owns Product related IP
Low margin Teva supply for CH / EU following
acquisition of Mepha site in Aesch
Main customers: Teva, Stada, in future Bayer
Discontinuation of betalactame production as
per end 2013
Production
Items not directly attributable to other
segments
Deviations from standard costs in
production
10

Segment BtC
Net Sales
Gross Margin
in EUR million
0.3
-0.6
9.3
19.1% of sales
-10 0 10 20 30 40 50
Acquisition related sales (4.5 months): EUR 48.2 million
Middle East region accounts for 61% of segment sales
Strong sales in Middle East and LATAM
Gross margin includes all selling expenses; negatively impacted by
integration efforts
Seasonal effect in MENA (lower sales in summer / Ramadan)
n.a.
H1-2011 H1-2012
Margin increase expected from H2-2012 onwards
48.9
11

Segment BtB
Net Sales
Gross Margin
in EUR million
18.0
15.8
Strong sales of oxycodone (+ 28%), metropolol (+ 44%), hydromorphone
(+127%), fentanyl (+1130%), buprenorphin (+39%)
Weaker sales of alfuzosin (-23%), clopidogrel (-21%), itraconazole (-5%)
Despite price pressure, managed to keep margin at last year’s level
No major acquisition related impacts
37.6% of sales
37.7% of sales
Top 5 customers account for 79% of segment sales
Top 5 products account for 65% of segment sales
41.9
0 10 20 30 40 50
H1-2011 H1-2012
48.0
+ 18%
+ 22%
12

Segment Technology Marketing
Net Sales
Gross Margin
in EUR million
6.7
8.5
21.8% of sales
38.8% of sales
Includes fentanyl contract manufacturing part (not own developments)
Production for Teva/Mepha out of Aesch:
� low margin, supports capacity utilization and overhead recovery
� expected to decrease over the next years and to be replaced by
higher margin products
Gross margin further impacted by continued price pressure
Top 5 customers account for 65% of net sales
22.0
30.8
0 5 10 15 20 25 30 35
H1-2011 H1-2012
+ 40%
- 21%
13

Syndication financing terms
Facility:
- EUR 110 million
Maturity:
- 5 years
- amortizing min. EUR 10 million p.a. starting 2013, remaining amount in 2017
Interest rate
- EURIBOR + margin dependent to net debt / EBITDA ratio
- All in cost : currently below 3% p.a.
Employed per June 30, 2012: EUR 100 million
Financial Summary: (in EUR millions) 2012 2013 2014
P&L charge (est.) 2.5 (*) 2.9 2.6
EPS impact (EUR) 0.74 0.85 0.77
(*) without one time charges
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Integration Process
Basle, August 2, 2012
Peter Burema, CEO Acino Group
Acino Holding Ltd.
Erlenstrasse 1 | CH-4058 Basle | www.acino-pharma.com
Phone +41 61 338 60 00 | Fax +41 61 338 60 80

Launching Acino Switzerland
portfolio products
Through the Mepha/Cephalon acquisition access to new markets in MENA, Africa,
Latin America & Asia is facilitated for Acino Switzerland’s own portfolio
First product launches in Q3/2012 - Q2/2013
Product launches:
� Launches of Clopacin (clopidogrel), Gosacin 3.6 (goserelin implant), Fentavera (fentanyl
patch), Metracin (metoprolol succinate), Fuzocim (alfuzosine) and others are scheduled in
several MENA & African markets
� First Asian launch of Clopacin in H2 2012
� Latin America filings are under way
In addition a high number of product submissions in B2C markets
� 38 already approved, additional 66 in registration
Marketing and Sales Teams operate under the Acino Switzerland label
Successful new & re-market entries
16

Transitional Brand
Communication Strategy
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Example: Clopacin ®
Clopacin ® (clopidogrel besylate):
“Swiss quality standard; the protection
you trust.”
First Acino Switzerland global
brand product to be introduced in
several MENA, African & Asian
markets in 2012/13
18

Acino’s growth drivers
BtC BtB Technology Marketing
Growth through acquisitions: targeted M&A activities
Inlicensing products
e.g. Iron sucrose, Zoledronic Acid
I.V., Paracetamol I.V.,
Panoprazole I.V.
Enter into new BtC
countries
Strong development pipeline, tailored to both
BtC and BtB markets
Roll out of “established
Acino products” in 60
new markets
Organic growth: high investments, exploit synergies & untapped potential
Growth of population
and GIP’s in emerging
markets
Broadening customer
base, new markets
New customer
acquisition based on
technological strengths
(pellets, microtablets,
patches, implants)
Bayer project,
several other projects
under way
19

Geographic break-down of revenue
Main countries 2010
Main countries H1-2012
(Product sales in end user markets, Acino actuals) (Product sales in end user markets, Acino actuals)
20

The “new” Acino: broad customer base
and activities in >130 countries
21

Integration of technical operations
Global Technical Operations organization in place
Warehouse consolidation in Aesch as per January 2013
Postponement of investments utilizing CH manufacturing sites/capabilities
Factory work shift harmonization in CH
Engineering: Rollout of internal engineering and reduction of external
services
Packaging: consolidation of departments and standardization of pack
design
Optimization of structures and processes like quality control and centralized
purchasing
Roll-out of MES Systems (increase of automation level)
22

Expanded technological capabilities
Orals, modified
release
Liesberg √ √ √ √
Aesch √ √ √ √
MUPS / Pellets
Miesbach √ √ √
Combined √ √ √ √ √ √ √
Oral dipersibles
Microtablets
Stickpacks
Transdermals
Implants
23

R&D highlights 2012
Development for oral and TDS development projects well on track:
– Successful completion of rivastigmine TDS development (generic to Exelon ® )
filings in EU, US & CH being the first ANDA submission of an Acino product in US
– Filing of oxycodone matrix planned in EU in Q3; well on track to support switch of
customers from pellet formulation to matrix tablet
– Development of goserelin in Japan progressing very well
Major milestones achieved in the development of unique products with own
IP and specific USPs with huge potential in EU & US:
� Low-loaded fentanyl patch with attractive small patch size
� Weekly pain patch with constant release over 7 days
� Innovative 7-day patch as Life Cycle Management for a major CNS indication
Pipeline further streamlined to also fulfill B2C needs and new projects from
former Mepha added or in evaluation
24

R&D highlights 2012
Technology base and expertise for special formulations and drug delivery
systems further broadened (microtablets)
Further strengthening implant platform and start of additional clinical studies
as requested by authorities.
Confident to bring the first generic Goserelin implant to the market.
Conclusions:
– Acino’s large pipeline is well balanced by indication, development stage
and technology platform to serve the B2B as well as B2C business
– More products for US filing to follow in near future and further product
developments for Japan in discussion
– Submissions in B2C continuing to expand portfolio to further markets
25

Acino‘s development pipeline
Estimated approval dates
26

Promising potential areas of
synergies through integration
2013 2014
Basle HQ and R&D activities will be moved to Aesch by end 2012
Mepha main warehouse activities transferred to Acino premises by
January 2013
Combined technical operations structures
New R&D structure (including regulatory) established
Engineering (rollout internal engineering, reduction
external services)
Finance, HR and IT systems
Cont.
Potential synergies
p.a. in EUR million
Synchronisation of market intelligence 0.5
1.0
0.8
2.6
1.0
0.6
3.5
Total 10.0
27

Update Guidance
2012 full year
� Sales: Upper level of guidance at EUR 260 million
� Comparable EBITDA: Slight increase over H1-2012
Continued strong sales growth 2013 onwards
Confirming 25% EBITDA margin 2014 onwards
Assuming SNB continues to successfully support the EUR at CHF 1.20
28

Key Facts: Acino TODAY
Fourth largest listed Swiss pharmaceutical company
(Acino Holding Ltd., domiciled in Basle, listed at the SIX Swiss Exchange: ACIN)
7 sites worldwide: 4x Switzerland (Basle, 2x Aesch, Liesberg), 1x Miesbach
(DE), 1x Paris (FR), 1x Panama (LATAM)
About 850 employees from over 40 nations
46 products for own brand marketing in various international territories
Marketing partnerships in over 130 countries
– Own brand marketing in over 80 countries (~380 marketing & sales staff)
– B2B/Outlicensing in more than 50 additional countries
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Acino – Delivering Health
Thank you for
your attention
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