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Investors‘ Presentation Jefferies Global Healthcare Conference
London| November 19, 2014
Disclaimer
This presentation contains statements concerning the Sartorius Groups’ future performance. These statements are based on assumptions and estimates. Although we are convinced that these forward-looking statements are realistic, we cannot guarantee that they will actually materialize. This is because our assumptions harbor risks and uncertainties that could lead to actual results diverging substantially from the expected ones. It is not planned to update our forward-looking statements.
Throughout this presentation, differences may be apparent as a result of rounding during addition.
Company Overview
Agenda
3
1
4
5 9M 2014 Results | Guidance 2014
Lab Products & Services
Growth Prospects and Projects
2 Bioprocess Solutions
Operational Setup
Share of Group sales based on 2013 figures 1) Share of Group EBITDA based on underlying EBITDA (excluding extraordinary items) 4 4
Sartorius Group
Sartorius Intec Bioprocess Solutions
Innovative single-use products and equip- ment for the production of biologics
Industrial weighing and control technologies
2013 € 887mn
Lab Products & Services
Premium lab instruments, consumables and services for R&D, QA and QC
30% 25% of Sales of EBITDA1)
12% 6% of Sales of EBITDA1)
58% 69% of Sales of EBITDA1)
Sales Revenue €517.8 mn Europe 47% NA 28% Asia 21%
EBITDA1) margin 23.0 % Employees 3,217 Locations 27
Key Division Figures 2013
Bioprocess Solutions
1) Underlying (excluding extraordinary items)
Solution Provider for Biomanufacturing
Supplier of key production technologies to the biopharma industry
Product quality and supply security key success factors; high regulatory requirements; validated processes
Paradigm shift towards single-use solutions
Sartorius with broadest product portfolio in the industry, with a clear focus on single-use
6
~ €518 mn
Equipment ~ 25 %
Single-use ~ 75 %
The Widest Product Portfolio Across the Biopharma Process Chain
7
Cell removal and clarification filters
Crossflow systems and Consumables
Configurable solutions
Bag tanks
Storage bags
Virus inactivation technologies
Buffers
Freeze-thaw technologies
Membrane chromatography
Cell culture media
Prefilled bags
SU mixing systems
Sterile filters
Bioreactors for process development
Production bioreactors
Monitoring and control technologies
Upstream Bioprocessing Downstream Bioprocessing
Media Process Dev.
Fermentation Cell Removal |
Clarification Capturing Polishing
Virus Cleanrance
Prep. of Bulk Drug Subst.
Multiple Drivers Fuel Significant Growth of the Biopharma Market
IMS Institute of Healthcare Informatics. The Global Use of Medicine: Outlook Through 2016|17 8
Growing & aging population World population to grow to ~ 9bn by 2050; ~ 2bn people will be 60 or older by 2050
Strong R&D pipelines Biologics >40% of all drugs in development
Increasing access to healthcare Increasing income available for healthcare in emerging countries $
CAGR 6% - 8%
Biosimilar market Emerging industry, especially in Asia
Clear Trend Towards Single-use Products
9
Past Present
Time to market
Cost savings
Risk management
Improved titers
Main Drivers
Leading Positions in Key Technology Platforms
10
BPS Millipore Pall Thermo GE Top 3 Players
Filtration 1. Pall 2. Millipore 3. Sartorius
Fluid Management 1. Sartorius 2. Thermo Fisher 3. Millipore
Fermentation 1. Sartorius 2. Thermo Fisher 3. GE
Purification 1. GE 2. Millipore 3. Pall
Cell Culture Media 1. Thermo Fisher 2. Sigma 3. GE
Circles indicate completeness of product offering; Announced acquisition of Sigma-Aldrich by Merck KGaA not yet considered
Lab Products & Services
Sales Revenue €267.4 mn Europe 53% NA 15% Asia 28%
EBITDA1) margin 16.0 % Employees 1,893 Locations 32
Key Division Figures 2013
1) Underlying (excluding extraordinary items)
Premium Lab Portfolio for Sample Prep. in R&D and QA Created
12
60-65% of Revenue
Lab Instruments Lab Consumables & Service
35-40% of Revenue
Lab Balances Part of former
Mechatronics Division
Biohit Liquid Handling
Acquisition Dec. 2011
Lab Consumables Part of former
Biotechnology Division
Three-channel Sales Approach to Address Broad Customer Base
13
Direct Sales Lab Distributors
e-commerce
Pharma | Biotech Academia Cl. Diagnostics |
Chemicals Food & Beverage
Global Lab Market Provides Significant Growth Potential
14
~ $39 bn
Asia 13%
North America 42%
Others 4%
Europe 40%
~ €267 mn
Global Laboratory Products Market1)
1) Frost & Sullivan, 2014 Half-year Update 2) FY 2013
Targeted market of > $3 bn
Average global market share of > 10%
Significant growth potential especially in the U.S. and Asia
LPS Sales by Region2)
North America 15%
Others 4% Europe 53%
Asia | Pacific 28%
Strong Positions in Key Categories
15
Mettler Toledo
Eppendorf Mettler Toledo Thermo Fisher Gilson
EMD Millipore Elga Thermo Fisher
#4
EMD Millipore Pall GE Whatman
#3 Lab water systems Pipettes Lab balances Consumables
#2 #4
Competitive Landscape
16
Service Is an Integral Part of the LPS Product Portfolio
Premium service offering by more than 50 local service centers
Provides valuable insight into customer needs
Excellent vehicle for lead generation
Important factor for differentiation
Increases customer satisfaction & loyalty
Company Overview
Agenda
3
1
4
5 9M 2014 Results | Guidance 2014
Lab Products & Services
Growth Prospects and Projects
2 Bioprocess Solutions
1) Excluding extraordinary items 2) Restated 18
85.1
110.2
136.6
161.1 172.6
14.1
16.7
18.6 19.0
19.5
Sales Revenue in € million
845.7
733.1 659.3
602.1
Strong Track Record of Profitable Growth
Earnings EBITDA & margin1)
2009 2011 2010 2013 20122)
CAGR ~19%
2009 2011 2010 2013 2012
887.3
CAGR ~10%
Regional
North America: Gain market share China | India: Leverage strong market growth
Ambitious 2020 Targets Supported by Growth Inititatives
1) Excluding extraordinary items 19
Strategic Initiatives 2020 Ambition
Portfolio
Expansion through alliances and acquisitions Own product development Potential divestiture of Industrial Weighing
Infrastructure
New global ERP system Expansion of production capacity
~ €2 bn Sales Revenue
~ 23% EBITDA margin1)
~ 2/3 Organic
~ 1/3 Acquisitions
Gain Market Share in North America; Leverage Strong Market Growth in Asia
20
Sales Revenue North America
2013
2012
2010
2011
Sales Shares
North America
CAGR ~10% Asia
Sales Revenue Asia
2013
2012
2010
2011
€887 mn
+2.6% +10.3%
+18.9%
+6.2%
+11.0%
+13.0%
+23.2%
+17.6%
In constant currencies In constant currencies
North America is the largest single market for biopharma and lab products; organic growth: low double-digit range targeted
China and India among the strongest-growing pharma and lab markets globally; continued double-digit organic growth projected for the next few years
21%
24% CAGR ~16%
FY 2013 data
Strong Execution on Acquisitions and Alliances
21
Acquisitions (2011-2014)
Alliances (2013-2014)
Biohit Liquid Handling
Lonza Cell Culture Media TAP Biosystems
> €200 mn sales potential
by 2020
Single-use sensors for biomass measurement
Sensors for oxygen and carbon dioxide measurement
Ready-to-use, prefilled media products for micro-biological applications
Significant expansion of technology portfolio
AllPure Technologies
InTec: Creation of Separate Subgroup Completed
22
Tank & Hopper solutions
Industrial Scales
Checkweigher
Supplier of premium weighing and control technologies for industrial applications
> 70% of sales generated from global TOP 4 positions; robust gross margins
Relatively small as a global stand-alone business
Non-core activity: long-term target to sell the business
Carve out including separate ERP system completed; reduced complexity in a divestment process
Further Investment Projects
Global roll-out of the new ERP system
Continued expansion of production capacity worldwide to accommodate growth
Capex ratio projected at ~ 8% - 10% for 2014; expected to remain in this corridor for the next few years
1) Based on 2014 guidance 23
Konzern
Capex ratio in % of sales revenue
4.0
7.1
3.7
2013 2011 2010 2009
8.8
2012
7.1 ~ 8-10
2014e1)
Company Overview
Agenda
3
1
4
5 9M 2014 Results | Guidance 2014
Lab Products & Services
Growth Prospects and Projects
2 Bioprocess Solutions
Strong Order Intake, Sales and Earnings Performance
25 1) In constant currencies 2) Excluding extraordinary items
Bioprocess Solutions in € million
Lab Products & Services in € million
Industrial Technologies in € million Sartorius Group
Bioprocess Solutions
Lab Products & Services
Industrial Technologies
Order intake + 10.1% in cc1)
+ 9.0% + 14.6% in cc1)
+ 13.7% + 2.3% in cc1)
+ 0.7% + 5.9% in cc1)
+ 4.7%
Sales revenue + 9.6% in cc1)
+ 8.4% + 17.2% in cc1)
+ 16.3% - 0.1% in cc1)
- 1.7% - 3.5% in cc1)
- 4.6%
Underlying2)
EBITDA margin1) 19.6%
(+ 40bps) 23.3%
(+ 60bps) 14.6%
(- 170bps) 10.1%
(+ 120bps)
Guidance Confirmed
1) In constant currencies 2) Excluding extraordinary items 26
2014 Guidance
Sales revenue growth1)
Underlying EBITDA margin1)2)
Sartorius Group 8% - 10% ~20.0%
Bioprocess Solutions ~12% - 15% Upper end of range
~23.5%
Lab Products & Services ~1% - 4%
Lower end of range ~15.0%
Industrial Technologies ~1% - 4%
Lower end of range ~10.5%
Economic uncertainty has increased, however no major impact on 2014 figures expected
Capex ratio expected to be around 8% - 10%
27
Thank you very much for your attention
Legal And Shareholder Structure
28
Sartorius AG Stock market listed in Germany - SRT / SRT3
Bio-Rad Laboratories Inc.
Treasury shares
Adm. by executor
Free float
91
9
Ord. in %
Prf. in %
Free float Sartorius AG
100% 74%
Other Sartorius Subsidiaries
Family owned
Sartorius Stedim Biotech S.A.
+ Subsidiaries
Stock market listed in France – DIM FP
~34
9
~5
50
~2
74
26
in %
Change Of Divisional Setup Since FY 2012
29
Schematic diagram
Bioprocess Biolab Industrial Weighing1) Lab Instruments
Mechatronics Biotechnology
Bioprocess Solutions Industrial Weighing1)
Previous Divisions
New Divisions
Jan. 2012
Biohit LH
Lab Products & Services
1) As of January 1, 2014: Industrial Technologies
Key Account Business With Limited Dependence on Individual Accounts
30
Approx. half of 2013 sales were generated with the Top 50 customers
No individual customer accounts for more than 5% of BPS sales revenue
No single drug accounts for more than 2% of BPS sales revenue
Long term business relationships with leading global (bio-)pharma companies
Limited dependence on individual accounts
0
50
100
150
200
Sales to Top 50 customers in 2013, in € mn
Top 10 11 to 20 21 to 30 31 to 40 41 to 50
Cumulative Share ~30%
~40% ~45% ~50% ~55%
Extension of BPS‘s Portfolio by Acquisition of AllPure Technologies
31
Majority stake acquired in U.S. start-up AllPure Technologies in April 2014
Allpure specializes in single-use components for biotech applications, e.g. aseptic sampling techniques
2013 revenue of ~ U.S. $3 mn.; based in New Oxford, Pennsylvania, USA
Excellent growth opportunities for AllPure products based on BPS‘s global reach, esp. in Europe and Asia
Most Recent Acquisitions Strengthen Bioprocess Portfolio
32
Leading supplier of small scale, multi-parallel single-use bioreactors
Sales revenue of ~ €26 mn, thereof ~ 50% in the U.S.
Scale-up with BPS technology
TAP Biosystems in December 2013
Strong first-year performance Gradual business transition into BPS
now completed Joint development of new
cell culture media well underway
Cell culture media in December 2012
Page 1
Singapore Kuala Lumpur
Bangalore
Hanoi
Tokyo Beijing Seoul
Hong Kong
Makati City Bangkok
Shanghai Suzhou
Mississauga
Mexico City Yauco
Bohemia
São Paulo
Buenos Aires Melbourne
Kajaani Helsinki
St. Petersburg Moscow
Goettingen Hamburg
Aachen Herlev
Poznan Guxhagen
Lourdes
M’Hamdia Milan
Florence
Tagelswangen Vienna Budapest
Madrid
Vilvoorde
Paris
Epsom
Stonehouse Dublin
Share of Sales North America
~ 21%
Share of Sales Europe ~ 51%
Share of Sales Asia
~ 24%
Global Presence: >30 sales and 18 manufacturing sites
33 Sales Production | Production and Sales
Royston
Wilmington
Rotterdam
European Home Market; North America and Asia Gaining Significance
Aubagne
New Oxford
34
Filtration Purification
Portfolio Bioprocess Solutions
35
Fluid Management Fermentation & Cell Culture Media
Portfolio Bioprocess Solutions
36
Lab Balances Pipettes
Portfolio Lab Products & Services
37
Mass comparators
Moisture Analyser
NucleoCounter
Lab Water Systems Further Lab Instruments
Portfolio Lab Products & Services
38
Lab Filtration Microbiological Quality Control
Portfolio Lab Products & Services
Executive Board of Sartorius AG
39
Jörg Pfirrmann, CFO since 2009
Finance, Human Resources, IT, General Administration
Joachim Kreuzburg, CEO since 2003
Corporate Strategy, Operations, Legal Affairs, Compliance, Corporate Communications
Reinhard Vogt since 2007
Marketing, Sales & Services
Financial Calendar
November 25, 2014 German Equity Forum, Frankfurt Main | Germany
January 27, 2015 Publication of preliminary figures for fiscal 2014
February 22, 2015 Annual Press Conference in Goettingen | Germany
April 9, 2015 Annual Shareholders‘ Meeting in Goettingen | Germany
April 20, 2015 Publication of first quarter 2014 figures
40
Contacts
41
Petra Kirchhoff Vice President Corporate Communications & IR Phone: +49.551.308.1686 E-mail: [email protected]
Sartorius Corporate Administration GmbH Weender Landstrasse 94-108 37075 Goettingen, Germany www.sartorius.com
Andreas Theisen Director Investor Relations Phone: +49.551.308.1668 E-mail: [email protected]