capture the full market potential - straumann...implant volumes in key markets (million units in...
TRANSCRIPT
Capture the full market potentialFabian Hildbrand Geneva, 17 June 2019
Looking back –Financial performance Q1 2019 and our track
record
2
We develop
high-end implants
3
21
0N
Financial Highlights in Q1
4
17%
ORGANIC SALES GROWTH
APAC & LATAM sustain growth ~20%
TOP PERFORMERS
Organic revenue to grow in
low-teen percentage range; further operating
margin improvements
OUTLOOK 2019
4-5%
IMPLANT MARKET GROWTH
all regions post
double-digit increases
REGIONAL TREND
12% consensus
(Vara Research)
ORGANIC SALES GROWTH 2021
Revenue development (in CHF m, rounded)
Q1 in a ‘nutshell’
0.3
20.2
16.4
13.04.9
LATAMM&A effect APACRevenues
Q1 2018
-6.6
EMEARevenues
Q1 2018
@FX 2019
FX effect
324.1317.8
Revenues
Q1 2019
North
America
372.3
14.9% in CHF
17.1% organic
Change in organic growth
17.4% 19.7%14.4% 22.1% 37%
30%
24%
9% LatinAmerica
AsiaPacific
NorthAmerica
EMEA
Regional share of
organic growth
5
6.4%
9.1%
13.1%
15.7%
18.9%
2014 2015 2016 2017 2018
24.8%
27.6%28.3%
29.3%29.6%
0
100
200
300
400
2014 2015 2016 2017 2018
EBITDA excl. exceptionals Exceptionals Underlying margin
Impressive 5-year performance
1 2017 figures restated to reflect updated purchase price allocation for ClearCorrect; figures excl. exceptional effects in all years.
5-year organic revenue growth 5-year EBITDA1 in CHF million and margin
Market
growth est. 4-5%
A v e r a g e + 1 3 % + 4 . 8 % - p o i n t s
6
Uncontested No. 1 in implants
4.5 bn
25%
#1
~26-28 bn
5%
#7
Implantology1Total
dentistry
Market
Straumann position
Straumann share
2018Others (400+)
25%
19%
12%
8%
7%
6%
4%
19%
Danaher
Dentsply
Sirona
Zimmer
Biomet
Henry
Schein
Osstem
Straumann
Group
1 Implant dentistry market segment includes implant fixtures, final and temporary abutments, healing screws, copings and related
instruments; information based on Decision Resources Group and Straumann data.
Main playersHenry Schein, Patterson,
Danaher, Dentsply Sirona
Align Technology, 3M
Dentium
7
Getting fit for the future
8
Villeret expansion project to
add 16 000 m2 production
area (operational early 2021)
2nd plant in Curitiba (Brazil) to add
11 000m2 production space (opening in Q4 2019)
BRA
CH
Success factors
Straumann Group – continuously
increasing the addressable market
Total solution provider tooth
replacement
Total solution provider esthetic dentistry
2012
2016
2018
Implant provider 3.4
Addressable market
in CHF billion
7.0
13.0
10
Preventive
dentistry
represents ~2bn
market opportunity
Our esthetic dentistry solutions portfolio
Implant systemsMulti-platform
prostheticsDigital Orthodontic Biomaterials Preventive
Glo
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bra
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alb
ran
ds
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no
log
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bra
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pa
rtn
ers
11
Targeted investments in high growth markets
12
Implant volumes in key markets (million
units in 2017)
1.5
1.2
1.3
2.4
0.8
1.4
2.7
0.2
0.4
1.4
0.3
SPAIN
ITALY
GERMANY
BRAZIL
TURKEY
RUSSIA
USA
UK-IRELAND
JAPAN
CHINA / HONG KONG
INDIA
319
197
160
118
98
160
74
38
33
10
2
Premium
Non-
Premium
Our new
subsidiaries
Penetration: Implants per 10’000 inhabitants
Reputation as innovation leader underpinned
13
12
19
Roxolid implant material
13
14
PURE ceramic 1-piece implant
Variobase abutments
BLT implant15
16 ProArch edentulous solution
N!ce fully-crystallized glass-ceramic Grand
Morse
Grand Morse implant
Grand
Morse
Mini implant
PURE 2-piece ceramic implant
17
18
BLX implant
Small diameter implant ( 2.9mm)
Short implant (4mm)
Roxolid-on-all
Chairside 3D printing
Long avenue of growth in other ‘specialties’
Market segments Est. segment size1
(2018 in CHF bn)Growth rate
Our current
market share
Biomaterials 0.7 High-single digits
Implantology1 4.7 Mid-single digits
CAD/CAM
equipment21.5 Double digits
CAD/CAM
prosthetics3.9 Double digits
(All ceramic)
Clear aligners 2.2 >25%
1 Imaging and planning segment is not included in the overview above. Customized prosthetics are listed under CAD/CAM prosthetics, but also belong to
the total implant and abutment market.
14
Looking ahead –recent achievments and
strategy in action
15
Full range of implant diameters and lengths
One connection – one prosthetic line
Ø 3.75 for all indications
Straumann® BLX implant portfolio
all indicationsØ 3.75
16
Focusing on the BLX launchDynamic Bone Management™
17
Current Straumann Group
market share
1 out of 4 implants have a fully tapered designMarket volume
(Implant fixtures)
25 million
units
Parallel
walled
Apically
tapered
Fully
tapered
Main players:
Nobel Biocare,
BioHorizons,
MIS, Implant
Direct, Megagen
Neodent,
Anthogyr and
Equinox
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The so called ,Value Segment’ – a new business opportunity
Unternehmensberichte, Capital IQ, Bernstein-Analyse, Straumann-Schätzungen
52%
48%
2018
77%
23%
2003
71%
29%
2008
Premium-Segment (value share in %)
Non-Premium-Segment
Half of the implant market is now ‘value’
Premium/value split of implant & abutment market
in value terms (2018)
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Global
EMEA
NAM
APAC
LATAM
2008: Premium 60-70 %
Premium segment
Value
22
2008: We were trapped in a premium niche market
2008
Premium
Value
Share of market value
Market value
CHF 3bn
Premium Volume Non-Premium Volume
Market volumes of
implant fixtures:
~14m
23
Multi-pricing strategy – comprehensive portfolio
of value implant brands
Neodent,
Anthogyr,
Medentika
Premium
Upper value
Lower value
Global implant & abutment market
~CHF 4bn
Straumann Group share (2018)
Zinedent,
T-Plus,
equinox
Our latest jewel in the crown
Stake increased from 30% to full ownership
Consolidation 1 June 2019; integration started
Leading French implant manufacturer; established
international provider of upper value implants
Comprehensive implant portfolio
Group to build on successful partnership in China
and Russia
Anthogyr employs 400 people
Total revenues last 12 months: CHF 57 million
(approx. CHF 50 million acquisition effect1)
241 Acquisition effect represents the revenues generated in the 12 months prior to the closing excluding intra-company sales. The amount may
fluctuate with currency movements.
25
Challenge: Bringing cultures
together that play the same game
Large potential for growth in digital equipment
Source: Straumann proprietary GP survey in US, DE, IT, and UK; samples size >200 dentists.
9% 11%
24%
12%
5% 4%
13% 11%
38%43%
68%
80%
UK Italy US GER UK Italy US GER UK Italy US GER
GPs using intra-oral scanners(IOS)
Dentists using IOS & chairsidemilling equipment
Dental technicians using labscanners
26
An even broader range of digital options
27
Virtuo Vivo™
intraoral scanner
3Shape TRIOS 4 Medit T-Series
DWOS 8 & CoDiagnostiX with Easy Modes;
Carestream, Camfacture, Medit integrated
3D printing capsule system
Clear aligners – one of the most
attractive areas in dentistry
3 out of 4 people
have misaligned
teeth or suffer
from malocclusion
Clear-aligner segment underpenetrated
30
North America:
Clear-aligner
penetration ~14-18%
Outside N. America:
Clear-aligner
penetration ~5-8%
>10mOrthodontic cases
annually
Clear aligner adoption drivers
More dentists trained (GPs/orthod.)
More GPs offer/promote treatment
Current users expand business
Attention to esthetics increasing
Geographic availability
Teenager segment penetration
Product improvement (ease-of- use,
more indications)
Digitalization simplifies workflow and
drives penetration
Source: World Statistics; Global Industry Analysts Inc. 2016; company fillings as well as broker research reports: Robert W. Baird 2015, William Blair 2017,
Stifel 2017, Leerink 2017.
Potential
31
Aligners are custom made –
each aligner is unique
PastMain treatment
providerToday Future
Purely esthetic needs
Mild to severe
Severe
Clear aligners will shake up the orthodontic market
331 Source: William Blair and National health & Nutrition Examination Survey (NHANES III) 1 Source: Company information, AAO, Straumann estimates
Retail shops /
pharmacies
Orthodontist
Orthodontist
General dentist
General
dentist
Orthodontist
ClearCorrect smiles spread to new markets
Case growth: Q1 +73%; FY’18 +61%;
Customer base expands by close to 20% in 2019
Continued strong growth in North America
ClearCorrect aligners promoted with Dental
Monitoring system in the US
Brazilian launched at CIOSP in Brazil and entry into the
attractive Chinese market
Expanding our production capacity
34
ClearCorrect
Launched in Brazil and Europe
Production expansion
Fresh new branding
Smyletec
Exclusive distribution agreement
Affordable, state-of-the-art solutions for China
World’s second largest market for clear aligners,
expected to grow >50% p.a. in the next 5 years
Smyletec launched in March; Dental Monitoring to
follow later in 2019
Clear-aligner business launched in Brazil, China and
Europe
35
Outlook 2019
36
Our 2019 guidanceBarring unforeseen circumstances
Market growth
Our revenue
growth
Profitability
Global implant market to continue to
grow between 4-5%
Further improvement in the underlying1
EBITDA and EBIT margin
Confident to outperform and achieve organic
revenue growth in the low-teens percentage range
1 Profitability objectives exclude exceptional effects related to acquisitions, business combinations as well as the impact from the adoption of
IFRS16 (see next slide). 37
Calendar of upcoming events
2019 Event Location
14 August First-half 2019 results conference Basel, HQ
28 August Octavian Swiss conference Zurich
03 September Investor meetings Milano
04 September Goldman Sachs conference London
05 September Investor meetings London
06 September UBS Best of Switzerland conference Zurich
Social media Type Source
Analyst Talk Executive interviewed by analysts Corporate Website / youtube
StraumannIR Investor Relations Twitter @StraumannIR
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Participating in high growth areas while mitigating the
risk of an economic slowdown
1 Emerging market classification based on MSCI GICS definition
More EM sales1… more balanced product
portfolio…
…offered at different
price points
Share of implant volumes in
2012 vs. 2018
Western Europe
Emerging markets (EM)
Other growth markets in developed
countries
Premium implant solutions
Non-premium implant solutions
New or adjacent products
Multi-pricing strategyProduct portfolio break-down
2012 vs. 2018 (in value)
Premium
Upper value
Lower value
40
Estimated impact from adopting
IFRS 16 (leases) in 2019
Approx. IFRS 16 impact (in CHF million)1 Total
Revenue
Gross margin +0.5
EBITDA +18.0
EBIT +3.0
Financial results -5.0
Profit before tax -2.0
1 Barring unforeseen circumstances, major currency movements and/or change in business scope41
CHF29%
EUR22%
USD/CAD/AUD26%
JPY3%
BRL8%
Other12%
CHF6%
EUR29%
USD/CAD/AUD31%
JPY5%
BRL8%
Other21%
Straumann’s currency exposure
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 FY 2018 figures as well as average FX rates in 2017-18. They also include recent acquisitions and new subsidiaries.
Cost breakdown FY20181
Revenue breakdown FY20181
Average exchange rates (rounded)FX sensitivity
(+/- 10%) on full-year...
2017 2018
Closing
2018 Revenue EBIT
1 EURCHF 1.11 1.15 1.13 +/- 39m +/- 23m
1 USDCHF 0.98 0.98 0.99 +/- 37m +/- 17m
100 BRLCHF 30.69 26.87 25.36 +/- 11m +/- 2m
100 JPYCHF 0.87 0.88 0.90 +/- 7m +/- 4m
70
75
80
85
90
95
100
105
110
115
01.2017 06.2017 11.2017 04.2018 09.2018
Exchange rates development in 2017-18
USDCHF EURCHF JPYCHF BRLCHF
42
Thank you