ORIOLA-KD CORPORATION January June 2016

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1 ORIOLA-KD CORPORATION January June 2016 Eero Hautaniemi, President and CEO 19 July

2 Oriola-KD April June 2016 Consumer performance was supported by good seasonal sales Share of OTC and TG continued to grow Significant volume growth in Services Increased number of order lines together with declining value/order line adversely affected efficiency and profitability Agreement with Meda signed. Starting during Summer 2017 Healthcare segment ramp-up continued according to plan In addition to dose dispensing, capabilities for hospital and veterinary services have been developed in Sweden In Sweden the Supreme Administrative Court did not accept Sjuklövern county councils appeal and hence the country councils have to renew the tendering process for dose dispensing. 2

3 Oriola-KD Key Figures Invoicing Net Sales Adjusted Operating profit All figures for Continuing operations 1-6/2016 net sales at comparable EUR/SEK rate EUR 819 million 1-6/2016 adjusted operating profit at comparable EUR/SEK rate EUR 28.6 million 3

4 Adjusted operating Profit January June 2016 Adjusted Operating profit Adjusted Operating profit, waterfall 4

5 Reporting segments January June

6 Solid Position in Selected Markets MARKET SHARE MARKET SIZE (BEUR) AND GROWTH Sweden Retail TG/OTC for pharmacies in Sweden 3 FINLAND CAGR 1.1 % 18% 31% SWEDEN CAGR 4.2 % Finland Wholesale Sweden Wholesale % 40% Source: IMS Health, ATY, Apoteksförening and Oriola-KD

7 Consumer Segment Focus on the needs of consumers in health and wellbeing related products and services. Offers expert advice on health and wellbeing as well as an extensive and high-quality selection of products in own pharmacies. Consistent service experience throughout all service channels, from local pharmacies to online services. NET SALES Sweden Latvia 316 PHARMACIES Of which 314 are Kronans Apotek Pharmacies in Sweden and 2 are pharmacies in Latvia Finland 7

8 Consumer January June 2016 On a constant currency basis the net sales increased by 4.3 (5.2) per cent Positive development of Sales mix supported margin and Operating profit Share of OTC and traded goods of net sales increased to 27.1 (26.0) per cent Net increase of five pharmacies in Sweden in January-June 2016 Five new establishments Two acquired from Hjärtat Two closed Parallel imports share of the Swedish pharmaceutical market was approximately 10.8 (10.6) per cent (source: IMS Health) Adjusted Operating profit 8

9 Pharmacy Chains in Sweden Pharmacies Market Share LloydsApoteket Apoteksgruppen Apotek Hjärtat & CURA Apoteket Pharmacies 2010 Established net Established net 2016 Source: Apoteksförening and Oriola-KD 9

10 Services Segment Focuses on long-term customer relationships and a wide service offering Provides logistics services and wide range of value adding services for Pharmaceutical companies and pharmacies Purchase and distribution services of OTC and traded goods in Sweden Sales and marketing services of large assortment of traded goods in Finland and in the Baltic countries Services for healthcare actors who want to succeed in the Nordic and Baltic countries. We provide high quality and ensure that products are delivered unchanged from Oriola s warehouses to the pharmacies, hospitals and veterinaries. INVOICING Logistic services Value adding services Sweden Baltics Finland Sales and marketing services Purchase and distribution services 10

11 Services January June 2016 On a constant currency basis the invoicing increased by 6.3 (11.7) per cent. Strong growth in invoicing was driven by Swedish operations Growth in both services to pharmaceutical companies and to pharmacies Increased number of order lines together with declining value/order line adversely affected efficiency and profitability Contract with Meda signed Distribution center in Oulu closed Negative cash flow from operations due to contractual changes Adjusted Operating profit 11

12 Events after the review period Oriola-KD group acquired the capital stock of Pharmaservice Oy on 18 July 2016 The company offers pharmaceutical dose dispensing services in Finland Pharmaservice Oy will be consolidated into Oriola-KD group from July 2016 and reported as part of Healthcare segment Oriola-KD aims to be the leading dose dispensing company in Sweden and Finland through the acquisitions of Svensk Dos in February 2016 and Pharmaservice in July

13 Healthcare Segment The Healthcare segment offers services to hospitals, healthcare centres and other healthcare operators in Sweden. Many growing business opportunities, such as hospital pharmaceutical care, dose dispensing and home distribution of pharmaceuticals. DOSE DISPENSING SERVICES Svensk Dos in Sweden and PharmaService in Finland are part of Oriola- KD Group and specialized in dose dispensing services. Finnish healthcare sector in transformation. HEALTHCARE BUSINESS GOALS Built on Oriola-KD s knowledge of market and customers Providing new services for healthcare organizations like clinics and hospitals NET SALES (2015) EMPLOYEES PATIENTS EUR EUR 28 MILLION MILLION ,000 20,000 13

14 Healthcare January June 2016 Acquisitions of Svensk Dos in February 2016 and Pharmaservice in July 2016 Number of dose dispensing patients continued to grow Sjuklövern tender process to be renewed New digital platform for veterinarians launched in Sweden and capabilities to serve hospitals developed Amortisation EUR 0.7 million in Jan- June 2016, estimated EUR 1.5 million in 2016 Adjusted Operating profit 14

15 Key Focus Areas in 2016 Active development of digital business Continue developing the Healthcare channel Successful execution of the efficiency improving strategic development initiatives 15

16 Key Figures January June

17 Cash flow Quarterly net cash flow from operating activities EUR million 1-6/ /2015 Change in working capital Net cash flow from operating activities Net cash flow from investing activities Net cash flow from financing activities 1) Net change in cash Cash and cash equivalents at the end of period ) Dividend of 23.6 MEUR was paid out in Q2 17

18 Net interest-bearing Debt Net Interest-Bearing Debt EUR million 30 June June 2015 Syndicated bank loans Commercial papers Advance payment from pharmacies Other Cash and cash equivalents Net interest-bearing debt Sold trade receivables Gearing, %

19 Key Figures EUR million Change % Change % Net sales ,626.3 Adjusted EBITDA EBITDA Adjusted Operating profit Operating profit Profit for the period

20 Balance Sheet and Key Ratios EUR million 30 June June ) 31 Dec 2015 Goodwill Equity Interest-bearing debt Interest-bearing net debt Balance sheet total Equity ratio, % Return on equity (ROE), % Return on capital employed (ROCE), % Gearing, % Equity per share, EUR Earnings per share (EPS), EUR Average number of shares, 1000 pcs 181, , ,502 1) Equity-related key figures restated as a result of correction of an error relating to previous financial periods. The correction was made in 2015 Financial Statements 20

21 Outlook for 2016 Oriola-KD estimates its full-year Net Sales to remain at the 2015 level on a constant currency basis. Adjusted Operating Profit is estimated to remain at 2015 level or to increase, on a constant currency basis. Full-year Net Sales in 2015 were EUR 1,626.3 million and Adjusted Operating Profit was EUR 60.8 million. Adjusted Operating Profit excludes gains and losses from the sale or discontinuation of business operations or assets, gains and losses from restructuring business operations, and impairment losses of goodwill and other non-current assets, or other income or expenses arising form rare events and, changes in estimates regarding the realisation of contingent consideration arising from business acquisitions. 21

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