sample & assay technologies€¦ · testing and nucleic acid-based molecular diagnostics;...

Sample & Assay Technologies

First quarter 2012 results

April 26, 2012

Sample & Assay Technologies Forward looking statements

Safe Harbor Statement: Certain of the statements contained in this presentation may be considered forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. To the extent that any of the statements contained herein relating to QIAGEN's products, markets, strategy or operating results, including without limitation its expected operating results, are forward-looking, such statements are based on current expectations and assumptions that involve a number of uncertainties and risks. Such uncertainties and risks include, but are not limited to, risks associated with management of growth and international operations (including the effects of currency fluctuations, regulatory processes and dependence on logistics), variability of operating results and allocations between customer classes, the commercial development of markets for our products in applied testing, personalized healthcare, clinical research, proteomics, women's health/HPV testing and nucleic acid-based molecular diagnostics; changing relationships with customers, suppliers and strategic partners; competition; rapid or unexpected changes in technologies; fluctuations in demand for QIAGEN's products (including fluctuations due to general economic conditions, the level and timing of customers' funding, budgets and other factors); our ability to obtain regulatory approval of our products; difficulties in successfully adapting QIAGEN's products to integrated solutions and producing such products; the ability of QIAGEN to identify and develop new products and to differentiate and protect our products from competitors' products; market acceptance of QIAGEN's new products and the integration of acquired technologies and businesses. For further information, please refer to the discussions in reports that QIAGEN has filed with, or furnished to, the U.S. Securities and Exchange Commission (SEC).

Regulation G: Some of the slides in this presentation contain certain summary information about QIAGEN N.V.’s sales, gross profit, operating income, net income, and earnings per share, which information is presented on a “non-GAAP financial measures” basis rather than in accordance with U.S. generally accepted accounting principles (GAAP). Please review QIAGEN’s press releases, which can be found in the Investor Relations section of QIAGEN’s webpage under www.QIAGEN.com, for information on the Company’s operating income, net income, and earnings per share presented on a GAAP basis. Such GAAP-basis information will also be contained in the Company’s reports on Form 20-F or Form 6-K to be filed with or furnished to the U.S. Securities and Exchange Commission.

First quarter 2012 results 2

Sample & Assay Technologies Agenda

Introduction Albert Fleury, Director IR

Overview Peer Schatz, CEO

Financial results Roland Sackers, CFO

Strategy update Peer Schatz, CEO

Summary Peer Schatz, CEO

2012 outlook Roland Sackers, CFO

Q&A Session



Financial results

In $ millions(except EPS)

Q1 2012 Q1 2011 Change $ (CER)

Net sales 296.4 264.3 +12% (+13% CER)

Adjusted operating income 80.3 70.5 +14%

Adjusted EPS diluted (In $ per share) 0.23 0.21

Business performance

Robust performances in Pharma, Academia and Applied Testing

Molecular Diagnostics: Improving results from growth drivers

+6% CER growth excluding Cellestis and Ipsogen

Q1 2012: Overview

New Business Areas

Creation of Molecular Diagnostics and Life Sciences Business Areas

Better address customer opportunities and regional demands

Making organizational and senior leadership changes

Strategic initiatives

U.S. and China clearances for QIAsymphony components

Preparing for U.S. approval of KRAS companion diagnostics

Efficiency project freeing up resources for reinvestment


Sample & Assay Technologies Focusing on multiple growth drivers

Investing in rapid growth Profiling: QIAsymphony rollout, broad testing portfolio

QuantiFERON-TB: Building momentum

PHC: Leadership in companion diagnostics

Maximizing value HPV: Leverage U.S. leadership, expand globally

Strategic foundation for MDx expansion

MDxgrowth drivers

Pharma

Academia

Applied Testing

HPV(U.S. 14%)

~29% of net sales+37% CER


(Rest of world 4%)





Creating new opportunities Applied Testing: forensics, food and vet testing

Pharma: Gene-based R&D

Academia: Translational medicine

Q1 2012 sales $296.4 million


MDx

Life Sciences



In $ millions(except EPS)

Q1 2012 Q1 2011 Change $ (CER)

Net sales 296.4 264.3 +12% (+13% CER)

Adjusted gross profit 209.8 190.9 +10%

Adjusted gross profit margin 71% 72%

Adjusted operating income 80.3 70.5 +14%

Adjusted operating income margin 27% 27%

Adjusted tax rate 28% 26%

Adjusted net income 54.8 49.5 +11%

Adjusted EPS (In $ per share) 0.23 0.21

Q1 2012: Key results

CER – Constant exchange ratesFor further information on adjustments, please refer to the reconciliation tables in QIAGEN's Q1 2012 earnings release or appendices Adjusted net income and adjusted EPS based on net income attributable to shareholders of QIAGEN N.V.

Double-digit growth in all regions

Adjusted gross margin above Q4 2011, in line with 2012 full-year target

R&D, marketing and admin gains offset higher gross margin and sales

Q1 2012: Higher adjusted tax rate and foreign currency losses


Sample & Assay Technologies Q1 2012: Geographic sales

CER – Constant exchange rates

Double-digit growth in all geographic regions

Asia-Pacific / Japan

18% of total net sales+14% CER Molecular Diagnostics Pharma and Academia QuantiFERON-TB China and Japan

Europe / Middle East / Africa

34% of total net sales+12% CER

MDx: Personalized Healthcare

Pharma

QIAsymphony

Germany, France and Italy

Spain

Americas

47% of total net sales+15% CER

Pharma and Applied Testing

QuantiFERON-TB

MDx: Personalized Healthcare

QIAsymphony

U.S., Canada and Brazil

Mexico


Rest of world represents approximately 1% of sales

Sample & Assay Technologies Q1 2012: Balance sheet and free cash flow

As of March 31, 2012

Group liquidity (In $ millions) 275

Net debt (In $ millions) 342

Shareholder equity ratio 69%

Net debt / adjusted EBITDA ratio 0.8

Q1 2012 free cash flow affected by one-time cash restructuring payments

Leverage ratio: Net debt / EBITDA (1)

0.00.2

3.3

2.2

0.4

0.1

0.9

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2005 2006 2007 2008 2009 2010 2011

(1) Adjusted figures excluding acquisition, integration and restructuring related charges as well as equity-based compensation

Cash flow (In $ millions) Q1 2012 Q1 2011

Net operating cash flow 11 50

Purchases of property, plant and equipment -19 -21

Free cash flow -8 29Q1

2012

0.8


Sample & Assay Technologies Driving growth and innovation

Strategy Initiatives 2012 goals

Develop QIAsymphony and QIAensemble system families

>750 QIAsymphony systems

Improve HPV automation

Roll out QIAensemble Decapper

Create new tests across all customer classes

Selected submissions:

EGFR (Tomtovok)

artus CMV

QuantiFERON CMV

BRAF

artus CT/GC

Expand in untapped markets

Target high-growth regions: Eastern Europe, Asia, Americas

Deliver sustainable growth with best-in-class teams

Grow at a faster pace than 2011

Drive productivity initiatives

Improve margins

Drive platform success

Add content

Grow efficiently and effectively

Broaden geographicpresence


Sample & Assay Technologies QIAsymphony RGQ: New era of automation

Most versatile molecular testing system

On track for >200 new placements in 2012

End-2011 level: >550 systems

Rising average consumables pull-through

Global rollout gaining momentum

Rotor-Gene Q cleared in U.S.– First U.S. QIAsymphony component

QIAsymphony SP approval in China– First QIAsymphony RGQ sale in April

Improving value proposition

Software update in Q2 2012

FFPE protocol for companion diagnostics

Development projects in all customer classesQIAsymphony SP

Sample input module

Automates purification

QIAsymphony AS

Eluate input

Automates assay setup

Sample Result

Rotor-Gene Q

Detection

Analysis

QIAsymphony family


Sample & Assay Technologies Adding content to QIAGEN portfolio

Selected regulatory projects Type Status

Rotor-Gene Q MDx Real-time PCR thermocycler instrument 510(k)

artus Influenza A/B Influenza test for use on Rotor-Gene Q MDx 510(k)

therascreen KRAS (Erbitux) Companion diagnostic for Erbitux in metastatic colorectal cancer PMA Submitted H2 2011

therascreen KRAS (Vectibix) Companion diagnostic for Vectibix in metastatic colorectal cancer PMA Submitted H2 2011

careHPV Low-cost HPV test for developing countries sFDA Submitted H2 2011

artus CT/NG Chlamydia (CT) and gonnorhea (GC) CE IVD Planned 2012 submission

artus CMV Cytomegalovirus (CMV) infections in transplant patients PMA Planned 2012

submission

QuantiFERON CMV Cytomegalovirus (CMV) infections in transplant patients 510(k) Planned 2012

submission

therascreen EGFR (Tomtovok) Companion diagnostic for Tomtovok in non-small cell lung cancer (NSCLC) PMA Planned 2012

submission

therascreen BRAF Biomarker test for melanoma CE IVD Planned 2012 submission



Screening

Immigrants

Expats

Refugees

QuantiFERON-TB U.S. annual test potential: >15 million

Public health

Employmentscreening

Community living

surveillance

Immuno- supressed

patients

Clinicaltrials

Government

Dept of Defense

Soldiers

Veterans

Corrections staff

Targeting QuantiFERON-TB U.S. markets


1

Public service

Police

Firefighters

Teachers

Nursing homes

University / Colleges

Homeless shelters

End-stage renal disease

Nephrologists

High-risk pregnancies

Obstetricians

Cancer patients

Oncologists

Biologic users

Rheumatologists

Dermatologists

Internists

HIV patients

Infectious disease doctors

CROs/Pharma

Research

Correctional facilities

Federal prisons

State prisons

State / local jails

Medical staff

Healthcare workers / VA

Nursing homes

Social workers

TB control

Contact investigations

TB clinics

2 3 4 5


KRAS testing in U.S. for metastatic colorectal cancer

Personalized Healthcare: Approaching $100 m sales in 2012

Companion diagnostics

Co-development milestones

Associated products

Expanding global presence

Europe: >30 biomarkers in industry-leading portfolio

Japan: Ramping up KRAS and EGFR sales after 2011 approvals

US: Preparing for KRAS companion diagnostic approvals

Expanding leadership in Personalized Healthcare

Preparing for KRAS launch in U.S.

Drive commercial

test adoption

~150,000

~110,000

~75,000

Estimated annual CRC

patients(Stages I-IV)

Current potential annual

KRAS tests(Stage IV)

Current annual

KRAS tests

Expand testing

Source: QIAGEN estimates



QIAsymphony global rollout

Test menu expansion

Companion diagnostics

U.S. market approvals

Translational medicine

Applied Testing

High-growth markets

Freeing up resources to reinvest

Returning QIAGEN to a faster growth profile

Reallocate resources and personnel, selective reductions

Project planning

Restructuring charge1

Implementing projects:

R&D portfolio

Manufacturing

Pricing optimization

Global procurement

Organizational excellence

Restructuring charge1

Completed Ongoing

Efficiency gains(Q4 2011 – Q1 2012)

Operational improvements(Start: Q1 2012) Selected investments

2012 goal: Free up $50 million to reinvest in strategic initiatives

1 Restructuring charges of $75 million taken in Q4 2011 and $11 million in Q1 2012, further charges may be taken in 2012


Sample & Assay Technologies New QIAGEN senior leadership structure

CEOOperations

& SCM

Douglas Liu

CFO

Roland Sackers

Commercial Operations

Bernd Uder

HR, Corporate Strat. & Mktg Services

Thomas Schweins

BD & IPL

Ulrich Schriek

Chief Medical Officer

Ellen Sheets

Peer Schatz

PMO & ProcessExcellence

Michael Collasius

Corp Communications

John Gilardi

Personalized Healthcare

Steve Little

BA Life Sciences

Dietrich Hauffe

BA Molecular Diagnostics

Helge Lubenow

Technology Council

Jie Kang

Legal

Philipp von Hugo


http://www.qiagen.com/about/whoweare/management/douglasliu.aspx

http://www.qiagen.com/about/whoweare/management/rolandsackers.aspx

http://www.qiagen.com/about/whoweare/management/bernduder.aspx

http://www.qiagen.com/about/whoweare/management/thomasschweins.aspx

http://www.qiagen.com/about/whoweare/management/ulrichschriek.aspx

http://www.qiagen.com/about/whoweare/management/michaelcollasius.aspx

http://www.qiagen.com/about/whoweare/management/peerschatz.aspx

http://www.qiagen.com/about/whoweare/management/michaelcollasius.aspx

http://www.qiagen.com/about/whoweare/management/rolandsackers.aspx

Sample & Assay Technologies 2012 outlook and assumptions

Q2 2012 outlook

FY 2012outlook

Total net sales1 +10-11% CER +6-8% CER

Adjusted diluted EPS2 ~$0.24 $1.03-1.05

Adjustments to operating income

Equity-based compensation (In $ millions) ~7 ~21-22

Amortization of acquired intellectual property (In $ millions) ~27 ~110

Business integration, acquisition and restructuring (In $ millions)3 ~10 ~30

Adjusted tax rate ~23-25% ~21-23%

Weighted average number of fully diluted shares outstanding (Based on $15.00 share price)4 ~239 million ~239 million


(1) Total sales includes contributions from the Cellestis (August 29, 2011) and Ipsogen (July 12, 2011) acquisitions and the rest of the QIAGEN business These expectations do not take into account any acquisitions that could be completed during 2012

(2) Adjusted results are non-GAAP financial measures that QIAGEN believes should be considered in addition to the reported results prepared in accordance with generally accepted accounting principles, but should not be considered a substitute. QIAGEN believes certain items – such as those listed above – should be excluded from adjusted results when they are outside the ongoing core operations, vary significantly from period to period, or affect the comparability of results with its competitors and its own prior periods. For further information on adjustments, please refer to the reconciliation tables in QIAGEN's Q1 2012 earnings release or appendices

(3) Full-year charge comprised of approximately $10 million for Cellestis and Ipsogen acquisitions and approximately $20 million for efficiency project.(4) Every $1.00 increase of share price results in ~1 million increase of weighted average number of fully diluted shares outstanding


Sample & Assay Technologies Summary

Solid start to 2012

Improvements in all customer classes and regions

Reaffirming FY 2012 outlook

Investing in rapid growth

Profiling: Viral load testing QIAsymphony rollout

Building leadership in Personalized Healthcare

Strong growth in new products: QuantiFERON TB

Maximizing value

HPV: Leveraging leadership in US, expansion internationally

Creating new markets

Applied Testing: Forensic, food and vet testing opportunities

Pharma: Gene-based R&D

Academia: Translational medicine



Appendix


In $ millions (unless indicated) Q1 2012 Q1 2011 Change

Net sales 296.4 264.3 12%

Net sales (CER) 299.4 264.3 13%

Gross profit 189.4 172.1 10%

Adjusted gross profit 209.8 190.9 10%

Operating income 36.5 38.4 -5%

Adjusted operating income 80.3 70.5 14%

Net income 28.6 28.0 2%

Adjusted net income 54.8 49.5 11%

EPS (In $ per share) 0.12 0.12

Adjusted EPS (In $ per share) 0.23 0.21

Weighted average number of diluted common shares (In millions) 238.9 240.4

Q1 2012

Summary income statement


For further information on adjustments, please refer to the reconciliation tables in QIAGEN's Q1 2012 earnings release or appendicesNet income and adjusted EPS based on net income attributable to shareholders of QIAGEN N.V.


Sample & Assay Technologies Q1 2012

Reconciliation of reported to adjusted figures

In $ millions (except EPS)

Net sales

Gross profit

Operating income

Pretax income

Income tax

Tax rate

Net income

Diluted EPS(1)

Reported results 296.4 189.4 36.5 33.2 - 4.6 14% 28.6 0.12

Adjustments

Business integration, acquisition related and restructuring costs

0.8 11.4 11.4 -3.9 34% 7.5 0.03

Purchased intangibles amortization 19.2 27.2 27.2 -10.9 40% 16.3 0.07

Share-based compensation 0.4 5.2 5.2 -1.1 21% 4.1 0.01

Other non-recurring income and expense -1.3 -0.4 -31% -1.7 -0.01

Total adjustments 20.4 43.8 42.5 -16.3 38% 26.2 0.11

Adjusted results 296.4 209.8 80.3 75.7 -20.9 28% 54.8 0.23

(1) In $ using 238.9 million diluted shares Table may have rounding differencesNet income and adjusted EPS based on net income attributable to shareholders of QIAGEN N.V.


Sample & Assay Technologies Q1 2012

Currency impact

In $ millions Reported net sales

Net sales at constant exchange rates

(CER)

Net sales change due to currency

Net sales in USD 123.1 123.1 0.0

Net sales in EUR 74.8 78.1 -3.3

Net sales in GBP 18.7 19.1 -0.4

Net sales in JPY 21.8 20.9 0.9

Net sales in other currencies 58.0 58.2 -0.2

Total 296.4 299.4 -3.0

CER – Constant exchange ratesOther currencies include CAD, TRY, SEK, CHF, AUD, BRL, CNY, MYR, SGD, KRW, HKD, MXN, INR, TWD


Sample & Assay Technologies Employees as of March 31, 2012

Americas Europe AsiaRest of World

Total Q1 2012

Total Q4 2011 Change

Production 236 586 97 4 923 924 0%

R&D 149 543 37 14 743 758 -2%

Sales 521 563 404 34 1,522 1,509 1%

Marketing 51 176 43 6 276 281 -2%

Admin 110 254 67 11 442 466 -5%

Total 1,067 2,122 648 69 3,906 3,938 -1%


Workforce reductions announced in late 2011 are not yet reflected in employee data


Helge LubenowDietrich Hauffe

Appointing new EC members

1988 Ph.D., Max Planck Institute

1988 Post-doctorate at the University of British Columbia (Canada)

1991 Assistant Professor at the University of Freiburg (Germany)

1993 Product Manager and increasing roles at Dionex (Germany and U.S.)

1997 Senior Product Manager Automation at QIAGEN (Germany)

2000 General Manager Germany at Dionex

2005 VP Global Marketing & Business Development at Dionex (U.S.)

2010 VP Marketing Applied Testing at QIAGEN

2011 VP Marketing Life Sciences at QIAGEN

2012 EC member and Head of Life Sciences Business Area

1997 Ph.D., University of Cologne

1997 R&D Director for application development at QIAGEN – developed products in areas such as applications DNA, gene expression, automation, Applied Testing

2002 General Manager of QIAGEN AS (Norway), led integration of Genovision AS

2007 Key manager for Digene integration in Gaithersburg (USA), established “Women’s Health” Portfolio Team

2009 Managing Director and VP Operations at QIAGEN (Australia), led Corbett integration

2010 VP Molecular Diagnostics at QIAGEN

2012 EC member and Head of Molecular Diagnostics Business Area



HIV Human Immunodeficiency Virus HKD Hong Kong DollarHPV Human PapillomavirusID IdentityIfp Institute for Product QualityINR Indian RupeeIP Intellectual PropertyJPY Japan YenKRAS Kirsten rat Sarcoma Viral Oncogene Homolog KRW South Korean WonLDT Laboratory Developed TestsM MillionMDx Molecular DiagnosticsMXN Mexican PesoMYR Malaysian RinggitNIH National Institutes of HealthPCR Polymerase chain reactionR&D Research & DevelopmentRoW Rest of WorldRGQ Rotor-Gene QRNA Ribonucleic AcidSEK Swedish KronaSGD Singapore DollarTB Tubercles BacillusTRY Turkish New LiraUS United States

Adj AdjustedAUD Australian DollarBRAF Serine/Threonine-Protein Kinase B-RafBRL Brazilian RealCAD Canadian Dollar CDx Companion diagnosticsCE European Conformance MarkCER Constant Exchange RatesCHF Swiss Franc CMV Cytomegalovirus CNY China Yuan RenminbiCT/NG Chlamydia Trachomatis/ Neisseria GonorrhoeaeDNA Deoxyribonucleic acidE EstimatedEBV Epstein-Barr virus EGFR Epidermal Growth Factor Receptor EPS Earnings per ShareEU European UnionEUR EuroExcl. ExcludingFDA Food and Drug AdministrationFX Foreign Exchange GAAP Generally Accepted Accounting PrinciplesGBP British PoundHBV Hepatitis B Virus HCV Hepatitis C virus

List of abbreviations


Sample & Assay Technologies Your contacts

E-mail: [email protected]

Angela SchmidtAssistant Investor RelationsTel: +49 2103 29 11709Mobile: +49 152 018 11709E-mail: [email protected]

2012 calendarAnnual General Meeting June 27 (Venlo)

Q2 results Media release: July 24 (22:00 CET)

Conference call: July 25 (15:30 CET)

Q3 results Media release: Oct 29 (22:00 CET)

Conference call: Oct 30 (15:30 CET)

Share informationNASDAQ: QGEN

Frankfurt: QIA

ISIN: NL0000240000

WKN: 901626

John GilardiVice President Corporate CommunicationsTel: +49 2103 29 11711

or +1 240 686 2222Mobile: +49 152 018 11711E-mail: [email protected]

Albert FleuryDirector Corporate Finance and Investor Relations Tel: +1 301 944 7028Mobile: +1 202 412 3871E-mail: [email protected]


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