Becoming a Total Solution Provider for tooth replacement

Transcription

1 Becoming a Total Solution Provider for tooth replacement Marco Gadola, CEO London, 18 November 2015 Not allowed for further use without permission

2 Disclaimer This presentation contains certain forward-looking statements that reflect the current views of management. Such statements are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Straumann Group to differ materially from those expressed or implied in this presentation. Straumann is providing the information in this presentation as of this date and does not undertake any obligation to update any statements contained in it as a result of new information, future events or otherwise. The availability and indications/claims of the products illustrated and mentioned in this presentation may vary according to country. 2

3 Q3 and 9M highlights

4 2015 9M On track with strong underlying growth 9M REVENUE Q3 ORGANIC REVENUE GROWTH Q3 BEST REGIONAL PERFORMER CHF585m +8% APAC +9% 1 (+18% in l.c.) including Neodent contribution of CHF 46m since 1 March Momentum continues in Q3, thanks to strong product cycle Driven by double-digit growth in China and Japan BLT IMPLANT STRATEGIC EXPANSION 2015 FY OUTLOOK > sold in first year Emerging markets On track Bone Level Tapered (BLT) implants available in >50 countries Subsidiary opens in Russia; distribution model in China complete; new hubs operational in LATAM...to achieve mid- to higher-single-digit organic revenue growth and underlying EBIT margin in low 20 s Organic growth i.e. excluding the effects of acquisitions, divestitures and currency exchange rates 2 Before business combination exceptionals (fair value adjustments to Neodent s acquisition-related inventory of CHF 13m)

5 Revitalized topline and sharp raise in profitability Organic revenue growth 6.4% 4.1% 8.6% % Operating profits 17.3% 18.2% 14.9% 20.9% 24.0% 30% 20% 2.5% 1.2% 10% 1.0% M H Operating income Exceptionals Underlying EBIT margin 0% in CHF million M y CAGR Revenue in CHF % growth in % Organic revenue growth Acquisiton / Divesture Total l.c. growth FX effect Total revenue growth (in CHF) Organic growth i.e. excluding the effects of acquisitions, divestitures and currency exchange rates

6 Growth across all regions lead by Asia and EMEA Organic growth rates in l.c.: North America 27% of Group revenue EMEA 47% of Group revenue APAC 15% of Group revenue 19.1 Q3 9M 13.2 Q3 9M LATAM 10% of Group revenue Group 8.6 Q3 9M Q3 9M Q3 9M 6 1 Figures include Neodent at time of consolidation on 1 March 2015

7 Sustained pick-up in EMEA EMEA 44% Revenue change (organic) 2.4% 7.0% 56% 0.3% 8.3% 8.5% Another strong quarter fuelled by double-digit growth in Iberia, France and Sweden Germany continues to perform well (2.0%) Q Q3 Q4 Q Q2 Q3 Biomaterials from botiss: ideal complement to Straumann s implant portfolio North America 28% 5.4% Q % Q3 9.3% Q4 11.6% Q % Q2 6.1% Q3 Solid Q3 (+6%) but softer than high 2014 baseline (BLT launch) Strong demand for BLT implants Group now supplies 80% of implants placed by ClearChoice 7

8 Combining strengths with botiss to provide complete regenerative solutions Straumann botiss Geistlich Bone allografts * Bone xenografts Bone synthetic grafts Bone blocks Custom bone blocks Bone rings Collagen cones Fleeces & sponges Membranes Soft-tissue grafts Biologics 8 *US only

9 We have benefitted from our new premium price structure... Implant price range PURE Roxolid SLActive RoxolidSLActive 200 SLATitanium SLA Roxolid Titanium SLA CM Aqua 100 Smart CM Neoporos Neoporos Introduction of Neodent brand in the US and selective markets in Europe and ASEAN region 9Straumann 1 German list prices used for reference. Please note that prices and offering may vary by country.

10 Continued strong growth in North America EMEA 44% Revenue change (organic) 2.4% 7.0% 56% 0.3% 8.3% 8.5% Another strong quarter fuelled by double-digit growth in Iberia, France and Sweden Germany continues to perform well (2.0%) Q Q3 Q4 Q Q2 Q3 Biomaterials from botiss: ideal complement to Straumann s implant portfolio North America 28% 5.4% Q % Q3 9.3% Q4 11.6% Q % Q2 6.1% Q3 Solid Q3 (+6%) but softer than high 2014 baseline (BLT launch) Strong demand for BLT implants Group now supplies 80% of implants placed by ClearChoice 10

11 Full conversion of ClearChoice chain expected until year end ClearChoice is the leader in full-arch restorations and does more implant procedures than any other US network Straumann and Neodent now account for 80% of the implants placed by the clinic network - and the upward trend continues CADCAM production in Arlington expanded to meet ClearChoice requirements Straumann Pro Arch solution 38 million adults in the US estimated to need one or two full dentures by Straumann CADCAM production 11 1 Douglass CW, Shih A, Ostry L. Will there be a need for complete dentures in the United States in 2020? J Prosthet Dent Jan;87(1):5-8

12 Double-digit growth in Asia; pursuing growth strategy in LATAM Revenue change (organic) Asia Pacific 16% 15.3% Q % Q3 14.5% Q4 34.5% 56% Q % Q2 13.2% Q3 Further share gains in Japan Continuing roll-out of SLActive and controlled market release of BLT in Japan Strong growth in China; all new distribution partners appointed LATAM 1 12% 6.5% Q % Q3 15.1% Q4 8.3% Q % 1.3% Q2 Q3 Sequential slowdown in Q3 (+1%) after a strong Q2, which benefitted from an increase in trading days Brazilian market remains sluggish CADCAM milling center operational in Brazil 12 1 Owing to the Neodent acquisition, Straumann re-allocated markets from the Rest of the World region to Latin America, with effect of 1 January The respective regional growth figures in the chart above have been recalculated on a proforma basis and include the Straumann as well as the Neodent business to allow for a true comparison.

13 Transition to hybrid distribution model in China completed Straumann China >70 consultative sales representatives 20 independent distributors Heilongjiang Jilin Marketing, T&E Liaoning Logistics, administration Xinjiang Gansu Inner Mongolia Ningxia Beijing Hebei Shanxi Tianjin Shandong Qinghai Shaanxi Henan Jiangsu Main benefits: Ability to address fast-growing private practice sector more effectively Broader reach and greater control of customer base Tibet Sichuan Yunnan Anhui Shanghai Chongqing Hubei Zhejiang Hunan Jiangxi Guizhou Fujian Guangxi Guangdong Fast market intelligence and ability to adapt Time of completion Q4-14 Hainan Q1-15 Q2-15 Q

14 Investing in unexploited growth markets Russia Subsidiary opened China Transition to new distribution set-up complete Japan New CADCAM milling center operational LATAM Hubs created in Colombia and Mexico serving both premium and value segments; Argentina to follow soon 14

15 Main industry trends

16 2010: A fragmented tooth replacement market Pure players Premium Value/Local Medical device companies Dental product manufacturers Dental Wholesaler >300 smaller/local players 16

17 2015: Five large players remain 18

18 Our main competitors can supply products for the entire tooth life-cycle Practice equipment Healthy tooth Esthetics on the tooth Saving the tooth Tooth replacement Preventive Orthodontic Restorative Endodontic Implant Prosthetics Regenerative Basic practice equipment, diagnostic and milling installations 19

19 Straumann the sole pure player Global market for dental implants and abutments worth an est. >CHF 3.5bn in 2014 Others 26% 24% 7% 13% 10% 20% 20 Based on idata, MRG and Straumann estimates. Zimmer Biomet 3i acquisition pending antitrust clearance.

20 The value segement has gained importance Market shares development per segment (in value terms) 1, ~ 25% ~ 30% 40% Market size est. CHF bn Market size est. CHF bn Market size est. CHF 3.5bn ~ 75% Premium segment (incl. Straumann) Value und Discount segment (incl. Neodent) ~ 70% ~60% 21 1 Please note that market size has been influenced by high volatility in exchange rates 2 Company reports, Capital IQ, Bernstein-Analyse, Straumann estimates

21 Digitalization is changing the tooth replacement workflow Impression Polyethylene Impression Intra oral scanner Local scan and milling in the dental practice Manufacturing Casting and polishing Milling centre De centralized Laser sintering 22

22 Patients expectations have increased Fulfillment of current patient expectations: Reliability Esthetics Minimal discomfort Step in quality of life Shorter treatment Affordability Today Potential 23

23 Update on strategic progress

24 Our key strategic priorities 1 Driving a high performance culture and organization 2 Targeting unexploited growth markets & segments 3 Becoming a total solution provider for tooth replacement 25

25 Potential identified to expand our position across indications and segments Stock abutments DVT / 3D radiology Surgical planning & drill guides Bone & tissue regeneration Dental implants Customized abutments CADCAM milling systems Scanners Conventionally manufactured prosthetics on implants (crowns, bridges, bars) CADCAM manu factured prosthetics 26 Global market size ~CHF 7bn Share of the Straumann Group

26 Our goal is to become the leading Total Solution Provider for all segments and indications Provide solutions for all major tooth replacement indications for dentists and for dental labs (both implant-borne and CADCAM tooth-borne) Scan, design & manufacturing method Conventional Semi digital 1 Fully digital 2 Clinical indication Simple posterior Esthetics Metal free Simple posterior Esthetics Simple removable Fixed edentulous (immediacy) Premium portfolio Value portfolio 27 1 Semi digital: dentist works conventionally, but lab works digitally 2 Fully digital: dentist & lab work digitally

27 We have made a big step in 2015 with several new product launches Surgical Full regenerative portfolio (botiss) PURE BLT Abutments Variobase for CEREC Removable denture attachment Pre milled abutments Restoration Chairside scanning & milling SR abutments Variobase family In lab milling equipment Screw retained bars & bridges New in lab scanner CARES X Stream DENTIST Surgeon GP / restorative Regional Local LABORATORY 28

28 We are broadening our CADCAM offering Lab scanning Centralised milling 3 rd party lab or intra oral scanners In lab / regional milling Intra oral scanning Chairside solution Scan of patient case Prosthetic design Manufacturing 29 today tomorrow

29 BLT represents a substantial growth potential for us in 2015 and beyond Tissue Level Bone Level Combined implant market size US & Germany (approx. 3,2million regular implant units 1 ) Parallel walled Apically tapered Fully tapered Parallel walled Apically tapered Fully tapered 1' STMN share Potential to grow Lower priced tapered implants All tapered implant designs account for approx. 60% of the global implant market (> CHF 2.1bn) Straumann s apically tapered implant represents a 1 million market opportunity in Germany and US alone The implant offers fast secondary stability (SLActive) and high implant strength (Roxolid) and addresses Already accountsd for over 15% of Straumann s implant volumes; approvals recently received in Brazil and Japan in Q customers now use BLT, >¼ of whom are new customers 30 Based on idata 2014, MRG 2015, AFG & Straumann proprietary surveys and estimates.

30 BLT as part of our ProArch solution extends our fully-edentulous portfolio straight-forward complex Locator (removable) Bar with pre-fabricated parts (removable) Straumann Pro Arch including tilted implants (fixed) Fixed screw-retained bridges 31

31 BLT implants offer better biomechanical stability and mimic the natural tooth root Higher vertical tensile strength Tapered implant placed in a tilted way in the posterior region Tapered implant are the preferred choice in certain extraction sockets and if limited anatomy (undercuts) is available 32

32 BLT offer improved primary stability in soft bone In combination with an underprepared osteotomy in soft bone tapered implants offer excellent primary stability (see RHS) Tapered implants may prevent the loss of the lateral bone wall in undercut situations (below) Compromised inter-tooth space with converging tooth roots (below) underprepared implant bed 33 Compromised intertooth space Straight implant cuts through apical bone wall

33 Outlook 2015

34 Unchanged outlook for 2015 Barring unforeseen circumstances Global implant market expected to continue growing in 2015 Group expects full-year revenue to grow organically in the mid- to higher-singledigit range Assuming that the currency exchange rates remain more or less at their 9M levels, the Group aims to achieve an EBIT margin in the low 20 s, before business combination exceptionals Fair value adjustments to Neodent s acquisition-related inventory of CHF 13m 35

35 Questions & Answers 36

36 Calendar of upcoming events November Investor meetings Edinburgh, UK 18 November Jefferies Healthcare conference London, UK 18 November Investor meetings London, UK 02 December Neodent Visitor Day Curitiba, BR January Baader Helvea Swiss Conference Bad Ragaz, CH 25 February Full year 2015 results conference Basel (HQ) 08 April AGM 2016 Basel 03 May Q1 sales publication Webcast 37 Results publication and corporate events. More information on straumann.com Events 37

37 Significant profitability improvements in CHF million Reported H before business combination exceptionals Reported excluding FX Revenue Organic growth% 9.2% 4.6% Change (rounded) excluding FX and exceptionals Gross profit % margin 75.8% 79.1% 78.9% 77.9% 120 bps EBITDA % margin 24.8% 28.0% 24.7% 22.6% 540 bps EBIT % margin 20.7% 24.0% 20.9% 18.6% 540 bps Net profit (0.7) margin (0.2%) 18.2% 19.1% Basic EPS (0.10) Free cash flow margin 11.3% 10.5% H

38 Neodent s comprehensive implant portfolio complements well... Drive Avim Titamax Titamax Ex WS Faciltiy NeoPoros Aqua NeoPoros Aqua NeoPoros Aqua NeoPoros Aqua NeoPoros NeoPoros Aqua Zygomatico Titanium (Grade IV) Titanium (Grade V) Smooth Surface 39

39 ...with the Straumann implant lines Workhorse implant Minimal invasive Ideal for the aesthetic zone More primary stability Metal free & improved aesthetics Tissue Level 4mm short implant Bone Level Bone Level Tapered PURE Monotype SLA SLActive SLActive SLA SLActive SLA SLActive ZLA Titanium Roxolid Ceramic 40

40 Further investments and partnerships to expand value and technology platforms Germany (100%) Canada (55%) Brazil (100%) Germany (51%) Spain (30%) USA (12%) Taiwan (conv. bond) S. Korea (conv. bond) Germany Switzerland (44%) Taiwan (49%) Austria Common technology and manufacturing platform 41

41 Straumann s production foot-print Andover (USA): Implant production Malmö (S): Regenerative products Naritake (JP): CADCAM milling Leipzig (D): CADCAM milling Arlington (USA): CADCAM milling Villeret (CH): Implant production Curitiba (BR): Implant production Straumann

42 Straumann s currency exposure BRL 9% Revenue breakdown H Other 19% CHF 10% EUR 34% Average exchange rates (rounded) FX sensitivity (+/- 10%) on M M Trend Revenue EBIT 1 EURCHF /- 13 million +/- 8 million 1 USDCHF /- 10 million +/- 3 million 1 BRLCHF /- 4 million +/- 1 million 100 JPYCHF /- 2 million +/- 1 million USD/CAD /AUD 28% Cost breakdown H BRL 8% Other 8% CHF 43% Development of Straumann s main exchange rates since USD/CAD/ AUD 22% EUR 17% 1 These distribution charts represent the total net revenues and the total COGS as well as OPEX in the various currencies. All numbers are rounded and based on H figures and include Neodent since 1 March. 80 USDCHF EURCHF JPYCHF BRLCHF

43 Your IR contacts Fabian Hildbrand Corporate Investor Relations Tel. +41 (0) Rahel Schafroth Investor Relations Coordination Tel. +41 (0)