Oriola Corporation Financial Statements 2018 22 February 2019 1 - PowerPoint PPT Presentation

Oriola Corporation Financial Statements 2018 22 February 2019 1

Oriola Q4 2018 Strong Invoicing Competition, Consumer online Strong and Net Sales seasonality and sales grew faster cash flow growth in constant investments than market Dividend proposal currencies affected Consumer EUR 0.09 per share profit negatively Inefficiencies Enköping DC burdened Hehku closing Oriola 70 year ramp-up starting Services financial decision and anniversary write-down in Finland in Q1/19 performance 2

Oriola Key Figures continuing operations Invoicing Net sales Adjusted EBIT EUR million EUR million EUR million 1 800 4 000 90 1 589 3 518 1 578 1 566 1 552 1 528 3 364 3 336 1 600 80 3 500 3 211 3 012 1 400 70 3 000 405 411 408 395 395 59.8 59.9 929 57.8 844 859 872 1 200 60 801 2 500 50 1 000 14.8 15.2 15.3 378 366 383 378 370 39.9 2 000 844 812 36.9 776 823 735 800 40 16.5 6.2 1 500 17.0 5.2 15.9 30 600 812 9.7 387 407 399 395 406 874 897 844 1 000 752 17.5 20 400 14.8 14.5 14.1 13.0 500 7.9 10 200 13.1 12.8 820 388 798 398 388 723 780 848 367 388 11.0 13.6 6.2 0 0 0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 2018 adjusted EBIT at comparable EUR/SEK rate EUR 39.1 million 3

Adjusted EBIT Q4 2018 continuing operations Adjusted EBIT, Quarters Adjusted EBIT EUR million EUR million 20 0.0 18 -0.7 17.5 1.0 -1.4 16 14 12 5.2 6.2 10 8 7.9 6 6.2 6.2 5.2 4 2 0 2017 2018 2018 2018 2018 Q4 2017 Consumer Services Healthcare Group items Q4 2018 Q4 Q1 Q2 Q3 Q4 Q4/2018 adjusted EBIT at comparable EUR/SEK rate 4 EUR 5.5 million

Business Areas January – December 2018

Consumer • Comprehensive health and wellbeing offering for consumers • Offers expert advice as well as an extensive selection of products in own Kronans Apotek pharmacies • Consistent service experience throughout all service channels, from local pharmacies or shops to online services Pharmacy market in Sweden 16 % 17 % 9 % 4.4 BEUR 4.4 BEUR 75 % 83 % Rx Oriola/Kronans Apotek OTC Others TG Source: Apoteksförening 6

Swedish Pharmacy retail market Market share Pharmacies 388 Apotek Hjärtat 387 397 389 2 & CURA 3% 4% 396 4% 397 Apoteket 395 0 31% 9% 326 327 Kronans Apotek 327 1 17% 187 188 Apoteksgruppen 188 3 79 79 79 Lloyds Apoteket 0 32% 48 Others 50 4 0 100 200 300 400 500 Oriola/Kronans Apotek Others Pharmacies 2010 Apoteket Lloyds Apoteket Established net 2010 - 2017 Apotek Hjärtat & CURA Apoteksgruppen Established net 2018 Apotea Source: Apoteksförening 7 18.7.2018

Consumer January – December 2018 continuing operations Adjusted EBIT EUR million • Pharmacy market grew by 9.7% in Sweden. Online sales grew by 38% to 8% of the market 14 • Net sales increased by 5.1% in constant currency 12 • Kronans Apotek’s online sales grew faster than 10 market (+63%) and was 2.8% of total sales 8 • Share of OTC and traded goods of net sales 6 6.0 25.6 (26.6)%. Share of RX increasing with lower 5.8 4 margins 4.4 4.0 3.0 2 • Hehku result impacted Adjusted EBIT by EUR -4.6 million (Q4: EUR -0.9 million) and FX 0 2017 2018 2018 2018 2018 impacted Adjusted EBIT by EUR -1.7 million Q4 Q1 Q2 Q3 Q4 (Q4: EUR -0.2 million) 8

Services • Focuses on long-term customer relationship and wide service offering for BtoB customers • Provides wholesale and logistics services with wide range of expert services for pharmaceutical companies, pharmacies, vets and grocery trade • Offers customized wholesale services of OTC and traded goods in Sweden • Provides wide range of health and wellbeing products and staffing services for Finnish pharmacies Finland Wholesale Sweden Wholesale 40 % 43 % 2.6 BEUR 4.3 BEUR 57 % 60 % Oriola Oriola Others Others LTK and Oriola estimate Reveal and Oriola estimate 9

Services January – December 2018 continuing operations Adjusted EBIT • Pharmaceutical market growth: Sweden 8.7% and Finland 8.5% EUR million • Net Sales increased by 4.2% and in constant 14 currency by 8.5% 13.7 12 • Profitability continued to be impacted by high 10 cost level in operations and delay in efficiency 8 improvements. 6 • Full EUR 9 million settlement payment received 4 from IT system provider 4.8 4.3 4.2 3.2 2 • In Finland ERP related additional impact was EUR 7 million (Q4 EUR 1.0 million) 0 2017 2018 2018 2018 2018 Q4 Q1 Q2 Q3 Q4 10

Healthcare • Pharmaceutical distribution and dose dispensing services for public and private healthcare providers • Dose dispensing market ca. 203,000 patients in Sweden, and 52,000 in Finland • Oriola dose dispensing cover services for 72,000 persons in Sweden and Finland, out of which more than 52,000 patients are in Sweden Market share dose dispensing Finland Sweden 5 % 8 % 25 % Oriola Oriola 39 % 40 % Pharmac Apoteket AB 32 MEUR 245 MEUR YA Apotekstjänst Pharma Dos 47 % 36 % Oriola estimate 11

Healthcare January – December 2018 Adjusted EBIT • Net Sales grew by 30.1%, and in constant EUR million currency by 37.2% • Growth continues to be driven by Swedish 2,0 market • Number of dose dispensing customers 0.2 exceeded 72,000 0.0 0.0 -0.1 0,0 • Major new contract with Stockholms Läns -0.2 Landsting signed in 2018 and deliveries 2017 2018 2018 2018 2018 Q4 Q1 Q2 Q3 Q4 starting Q1 2019. -2,0 12

Key Figures January – December 2018

continuing operations Key Figures 10-12 10-12 Change 1-12 1-12 Change EUR million 2018 2017 % 2018 2017 % Invoicing 929.1 871.6 6.6 3,518.4 3,336.3 5.5 Net sales 394.7 395.2 -0.1 1,552.2 1,527.7 1.6 Adjusted EBITDA 12.0 13.1 -8.2 65.5 67.6 -3.0 Adjusted EBIT 5.2 6.2 -16.4 36.9 39.9 -7.7 EBIT -8.0 3.9 -304.4 22.0 37.8 -41.9 Profit for the period -8.5 2.1 -495.8 12.7 25.9 -51.1 Cash flow from 48.4 11.0 102.8 23.7 operating activities Net interest bearing 63.6 110.2 debt Gearing % 35.1 55.7 14

Cash flow including discontinued operations Q4 2018 change in cash Quarterly net cash flow from operating activities EUR million EUR million 60 50 51 48 40 -41.5 30 33 -12.3 20 18 10 102.8 11 3 0 65.8 -15 -10 -24 17.0 -20 -30 Cash Q4 2017 Operating Investing Financing Cash Q4 2018 Q1/2017 Q2/2017 Q3/2017 Q4/2017 Q1/2018 Q2/2018 Q3/2018 Q4/2018 activities activities activities 15

Net Interest-Bearing Debt including discontinued operations Net interest-bearing debt EUR million 31 Dec 31 Dec 2018 2017 EUR million 140 Bank loans (syndicated & 59.0 60.6 term) 120 121 Commercial papers 57.0 50.0 110 105 100 101 100 Advance payment from 12.4 15.0 pharmacies 80 84 84 Other 1.0 1.7 64 60 Cash and cash equivalents 65.8 17.0 40 Net interest-bearing debt 63.6 110.2 20 Sold trade receivables 140.5 94.8 0 Q1/2017 Q2/2017 Q3/2017 Q4/2017 Q1/2018 Q2/2018 Q3/2018 Q4/2018 Gearing % 35.1 55.7 16

Year 2019

Outlook 2019 Adjusted EBIT on constant currency basis is estimated to increase from the 2018 level. 18

20by20 Excellence programme • New programme to ensure efficiency, high-quality operations and reduce costs • Annualised savings EUR 20 million compared to 2018 cost level with full effect by end of 2020 • Improving profitability • Indirect and direct purchasing savings • Product and service portfolio optimisation • Logistics efficiency in both countries • Lean and simplified processes throughout the company • The Group-wide programme will cover all business areas, operations and functions 19

New customer focused business areas Consumer Retail services and products for consumer health and wellbeing. Pharma Tailored logistics and expert and advisory services to pharmaceutical companies, and a wide range of pharmaceutical products for pharmacies, hospital pharmacies and veterinaries. Retail Wide range of health and wellbeing products for pharmacies, veterinaries, private and public healthcare operators and retailers, as well as services for pharmacies, including dose services and staffing. 20

Health for life 21