Annual Results Presentation For the year ended 30 June 2017 - PowerPoint PPT Presentation

Annual Results Presentation For the year ended 30 June 2017

Highlights 2 Delivery on guidance of strong H2 Revenue (R’ billion) *CER Growth Growth • Revenue growth even higher than H1 FY 2017 41.2 +16% +22% • Gross profit percentage impacted by increased anaesthesia H1 2017 19.8 +13% +14% • NHEPS growth more in line with revenue +31% +19% • Sustained improvements in working capital and operating cash flows H2 2017 21.4 NHEPS (cents) Cashflow *CER Growth Growth Operating cash flow per 101% FY 2017 1,463.2 +16% +21% share 1 421 cents H1 2017 +6% +7% 692.0 Operating profit to cash flow 109% +37% +27% H2 2017 conversion rate 771.2 *Prior comparative period restated to prevailing average exchange rates Annual Results Presentation for the year ended 30 June 2017

Group revenue  by customer geography 3 Revenue by customer geography  Performance in ZAR is determined by FY 2016 FY 2016 − Fluctuations in exchange rate; and FY 2017 FY 2016 FY 2016 % change % change (CER)* % change (CER)* % change R’million − Underlying operational performance Developed Europe 11 431 11 100 11 100 3% 3% 10 161 10 161 13% 13%  Exchange rate effect Asia Pacific 10 957 7 778 42% 7 490 46% 7 738 42% 7 490 46% − Variance between actual and constant Sub-Saharan Africa 9 892 9 355 6% 9 185 8% 9 355 6% 9 185 8% exchange rate (CER)  CER reflects the underlying Latin America 4 184 3 481 20% 3 254 28% 3 481 20% 3 254 29% operational performance Developing Europe and 2 589 2 345 2 345 10% 10% 2 223 2 223 16% 16% CIS 878 27% 820 36% MENA 1 117 878 27% 820 36% 662 58% 618 69% USA & Canada 1 043 662 58% 618 69% Total 41 213 35 559 35 559 16% 16% 33 751 33 751 22% 22% * FY 2016 restated at FY 2017 average exchange rates Annual Results Presentation for the year ended 30 June 2017

Group revenue  by business segment 4 Revenue by business segment R’million FY 2017 FY 2016 % change FY 2016 (CER) FY 2016 (CER) % change % change Commercial Pharma 31 437 25 403 24% 24 240 24 240 30% 30% Anaesthetics* 7 065 114 >100% 114 114 >100% >100% Thrombosis* 5 665 6 448 -12% 5 989 5 989 -5% -5% High Potency & Cytotoxics* 4 687 5 030 -7% 4 696 4 696 0% 0% Other Commercial Pharma Brands * 14 020 13 811 2% 13 441 13 441 4% 4% Nutritionals 3 224 3 516 -8% 3 331 3 331 -3% -3% Manufacturing 6 552 6 640 -1% 6 180 6 180 6% 6% - API 4 411 4 365 1% 4 041 4 041 9% 9% - FDF 2 141 2 275 -6% 2 139 2 139 0% 0% Total Revenue 41 213 35 559 16% 33 751 33 751 22% 22% * Therapeutic focused brands * Other Commercial Pharma Brands are largely domestic brands Annual Results Presentation for the year ended 30 June 2017

The evolution of Aspen Commercial Pharma • Geographic diversity • Product portfolio Manufacturing Capacity and Capability • Finished Dose Form • API

Commercial Pharma  geographic diversity 6 FY 2017 FY 2013 FY 2000 Sales R31.4 billion Sales R18.6 billion Sales R1.0 billion South Africa South Africa Australia Australasia Japan Brazil Germany China Latin America Brazil SSA France Rest of Asia Italy United Kingdom Philippines South Africa only Mexico Japan Russian Federation Rest of world United States Netherlands Poland Predominantly SA and Australia Canada Belgium Tanzania Rest of World Global Multinational In FY2017, there was a further ±R10 billion of revenue from Nutritionals and Manufacturing Annual Results Presentation for the year ended 30 June 2017

Commercial Pharma  product portfolio 7 FY 2017 FY 2013 FY 2000 Sales R31.4 billion Sales R18.6 billion Sales R1.0 billion Anaesthetics Thrombosis High Potency & Cytotoxics Other Commercial Pharma Brands Other Commercial Predominantly Other Commercial Pharma Brands Pharma Brands with limited therapeutic focused brands Global and diverse product range with a focus on Speciality • • FY 2017: SA < 50% of Other Commercial Pharma brands Generics account for ±10% of sales Annual Results Presentation for the year ended 30 June 2017

Manufacturing  FDF capacity & capability 8 FY 2017 FY2022 FY 2013 FY 2000 Further evolution to Dominant sterile platform Predominantly solids Tablets only Sterile Manufacturing with Speciality & Solids with some Speciality 3% 12% 32% 13% 58% 75% 7% Solids High Potency Solids High Potency Steriles Steriles Semisolids/Liquids Anaesthesia Products • PE – High Potency & Cytotoxics • BO - High Potency Steriles (amps & vials) • BO – Hormonal creams • PE – Lyophilisation & Eye drops PE - Tablets • NDB – Prefilled syringes Annual Results Presentation for the year ended 30 June 2017

Manufacturing  API capacity & capability 9 FY 2017 FY 2013 Total Capacity 200 KvH Total Capacity 980 KvH Capabilities Added Capabilities Netherlands- Oss Anaesthetics High Potency & Cytotoxics Speciality chemicals Muscle relaxants 20% Steroids/Alkaloids/Heterocyclics Cape Town – FCC Cape Town - FCC 34% Narcotics Conjugated & Esterified estrogens 100% Netherlands- Oss Analgesics Peptides Biochemicals 15% Antipsychotics Hormonal & General intermediates Antineoplastics Biochemicals – Heparin & Danaparoid India – Vizag* Gonadotropins Bronchodilators 31% NDB:  Purification of Fondaparinux  Conversion of heparin to Nadroparin • Five fold capacity increase • Enhanced capabilities • Broader geographic diversity *Intermediate manufacturing Annual Results Presentation for the year ended 30 June 2017

Commercial Pharma

Commercial Pharma revenue contribution  by region & therapeutic category 11 46% 22% DM revenue contribution 45% 54% Developed 18% Markets EM revenue contribution 15% Anaesthetics Thrombosis  Weighting towards Emerging Markets High Potency And Cytotoxic Other Commercial Pharma Brands − Maybe the only global pharmaceutical multinational Developed and Emerging Markets as defined by MSCI ACWI Index and Frontier Markets Index Annual Results Presentation for the year ended 30 June 2017

Anaesthetic Brands 12 Regional representation FY 2016 R’ million FY 2017 (CER) % change 55% Developed Markets 3 885 7 >100% DM revenue contribution Emerging Markets 3 180 107 >100% Total Revenue 7 065 114 >100% Emerging Developed  Largest sector of therapeutic focused brands Markets Markets  Broad portfolio − No.1 globally (ex-USA) − Local, general and topical 45% − AZ & GSK products included for ten and four months respectively EM revenue contribution Annual Results Presentation for the year ended 30 June 2017

Anaesthetic Brands 13  Complex supply chain − Global anaesthesia supply unstable − Demand unpredictable  Competitor stock outs  Sufficient capacity is an opportunistic success factor − Current supply chain has constraints  Will acquire control over supply chain − Aspen has proven skill in supply chain management  Market transitions ongoing − Successful transitions to date  Demonstration of Aspen experience  Capability in managing complex processes − Impacts comparable sales  Strong brand loyalty to both brands and related devices − Particularly in EMs Annual Results Presentation for the year ended 30 June 2017

Anaesthetic Brands  China 14  Significant operational structure established within China Number of Geography of detailing head count heads  Fully operational offices in the following locations: 中原大区 Shandong / Henan 30 − Beijing, Shanghai and Guangzhou 北京大区 Beijing 20  Infrastructure established, capacity to take on more 华 北大区 Tianjing / Inner Mongolia / Shanxi / Hebei 26 东 北大区 Heilongjiang / Jilin / Liaoning 23 IMS Ex-factory MAT Growth Rates - Units 西北大区 Shaanxi / Gansu / Ningxia / Qinhai / Xinjiang 21 华 中大区 Jiangsu / Anhui 29 Dec 2015 Aug 2016 Jun 2017 华东 大区 Shanghai / Zhejiang 48 华 南大区 Guangdong / Hainan / Fujian / Guangxi 60 8.6% 7.0% 中南大区 Hunan / Hubei / Jiangxi 27 2.5% Sichuan / Chongqing / Yunan / Guizhou / 西南大区 29 Tibet -1.5% Total 313 Detailing heads count increase 1 Sept 2017 225 (GSK Transfers) -15.7% Total heads dealing with doctors and -19.7% 538 product DIPRIVAN TOTAL AZ ANAESTHETICS Support Staff 72  Still very early days – encouraging signs in the AZ portfolio Total Aspen China 610 “A man grows most tired while standing still” - Chinese Proverb Annual Results Presentation for the year ended 30 June 2017

Anaesthetic Brands  Prospects 15  The anaesthetics portfolio has positively impacted sales − Annualised effect will enhance FY 2018 performance  Largely fits on existing infrastructure − Commercial and manufacturing synergies  Critical mass to establish presence in China and Japan  Structure of initial transaction negatively affected gross margins  Reversed by acquisition of supply rights − Cessation of royalty payment  Operating income to be positively impacted − FY 2017 pro forma + USD 90 million  Ready pipeline provided by breadth of portfolio − Introduce diverse existing products into new markets Annual Results Presentation for the year ended 30 June 2017