2015 First-quarter revenue
Conference Call
Basel, 30 April 2015
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.
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1
Q1 Highlights
Marco Gadola, CEO
Good start to 2015
REVENUE
CHF
4
193m
Q1 REVENUE GROWTH
KEY DRIVERS
+8% organic
North America and
APAC
1
Including CHF 7m contribution from
Neodent following full consolidation
since 1 March
Performance reflects investments in
growth markets/segments; revenue grew
12% including Neodent acquisition effect
Double-digit expansion (organic) in
N. America, APAC, & LATAM; EMEA
softened by FX mitigation measures
NEW BLT IMPLANT
OUTLOOK
PENETRATING VALUE
>4% volume share
Swift action to
preserve margins
Neodent acquired
Positive response in controlled market
release; full release underway in N.
America and initial European markets;
other regions to follow
Prompt initiatives to mitigate currency
shock. Full-year guidance unchanged:
organic revenue growth in mid-single
digit range; EBIT margin >20%
Remaining 51% acquired 3 years
early for CHF 210m, making the
Group a global leader in the fastgrowing value segment
1 The
term ‘organic’ used throughout this document means ‘excluding the effects of currency fluctuations
and acquired/divested business activities’.
2
Neodent: undisputed leader in Brazil
Brazilian implant market:
2.3m implant units sold in 20142
 Approx. 40% domestic market share
 Good reputation for customer focus/service;
high-quality perception among Brazilian
dentists
 Strong on education with ILAPEO1, one of
the world´s largest implant training centers
(>2000 dentists trained p.a.)
Nobel Biocare
Others
Zimmer
Biomet 3i
Titaniumfix
SIN
 Cost-efficient, modern production
Conexao
1 Instituto
5
Latino Americano de Pesquisa e Ensino Odontologico
Research 2015 and Straumann estimates
2 Millennium
Successful philosophy of making tested implant
solutions more affordable to a broader population
Cost-efficient manufacturing...
15 direct-to-dentist shops
...plant in Curitiba, south of São Paulo
Broad range of implants and prosthetics
6
3
Neodent - an expanding global presence
Availablity of Neodent products through:
Own subsidiaries, Instradent and 3rd party distributors
Future roll-outs
7
The new market share situation
Global dental implant & abutment market
worth CHF 3bn (2014 pro-forma)
24%
26%
Others
7%
20%
13%
10%
8
Based on iData, MRG and Straumann estimates. Zimmer-Biomet 3i acquisition pending antitrust clearance.
4
Business and regional
performance
Peter Hackel, CFO
Regenerative sales complement robust growth in
implants
Implants
Restorative
Regeneratives
10
5
Double-digit growth outside EMEA
In CHF million, rounded
7.4% in CHF
8.2% organic
1.3
7.4
5.6
0.3
(7.8)
6.7
193.2
179.8
178.6
Organic growth
(4.4%)
Revenue Q1
2014
FX Effect
3.9%
Acquisition Adj. revenue
Effect
Q1 2014
0.3%
11.6%
34.5%
11.7%
EMEA
North
America
APAC
LATAM
2014
Revenue Q1
2015
2015
11
Strong growth in North America; EMEA held
back by currency mitigation measures
EMEA
Revenue change (organic)
51%
7.0%
5.5%
56%
2.4%
0.3%
(2.0%)
North America
Q1 2014
Q2 2014
Q3 2014
11.4%
5.2%
5.4%
Q1 2014
Q2 2014
Q4 2014
9.3%
Q12015
11.6%
28%
Q3 2014
Q4 2014
Q12015
 Europe flat year-on-year;
distributor transfer price
adjustments (to compensate for
sharp rise in CHF) dampen growth
 Strong performers: UK, France,
Austria and Nordics; Germany
with solid growth
 Russian subsidiary to be
established in 2015
 Another strong quarter with growth
across all business segments
 New Bone Level Tapered implant
well received and enables share-ofwallet gains
 SLActive and Roxolid share further
increased
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6
Dynamic China and continued good performance
in Latin America
Asia Pacific
Revenue change (organic)
34.5%
56%
15%
15.3%
17.0%
Q2 2014
Q3 2014
Q4 2014
Q1 2015
15.0%
11.7%
7.3%
6%
Q1 2014
Q2 2014
Q3 2014
Q4 2014
 Robust growth in Australia, Korea
and distributor markets
 Double-digit growth driven by
strong demand for implants in most
markets
36.7%
30.6%
LATAM
 Growth in Japan expectedly below
prior Q1 (SLActive launch; stocking
before April VAT increase)
14.5%
8.3%
Q1 2014
 Exceptional growth in China due to
stocking by new dealers
Q1 2015
 Strong performance in Mexico;
continued growth in Brazil
 Neodent posts 10% growth in
domestic market
13
Neodent fully acquired
7
Neodent key figures
Experience
Revenue 2014
22y
BRL
history
CHF
Revenue growth 2014 (l.c.)
258m
101m
1
12%
8%
worldwide
domestic
Founded 1993
Leading implant company in LATAM
Robust growth and further share gains
in domestic market despite challenging
economy
Outlook 2015
Highly profitable
Employees
>1m
>35%
>25%
~950
units
A top-5 global implant
company in volume terms;
Neodent expects to sell >1m
implants in 2015
15
1
EBITDA
Net profit
Margin accretive for Straumann
Continious investment in manufacturing
capacity and workforce
At average 2014 BRLCHF foreign exchange rate
Straumann’s geographic spread including
Neodent
Straumann
Neodent
ex-LATAM
<10%
LATAM
3%
APAC
15%
North
America
27%
Group 2014 (pro-forma1)
LATAM
12%
APAC
14%
EMEA
49%
EMEA
55%
LATAM
>90%
North
America
25%
 Full acquisition strengthens Straumann’s position in the value segment and
extends its global leadership in tooth replacement
 Straumann has consolidated Neodent fully as of 1 March 2015
1 Owing
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to the Neodent consolidation Straumann has re-allocated markets from the ‘Rest of the World’ region to
1100%
EMEA and
Latin combination
America, with effect
of 1 January
2015.
The respective regional figures in this chart have been
of Straumann
and
Neodent
restated accordingly and include Neodent’s external revenues from 1 March 2014 onwards.
8
Details of the Neodent accounting
 Neodent consolidation will trigger fair-value adjustments
 PPA and opening balance to be finalized; amortization charges may still vary
until completion:
Amortization of intangible assets (approx. CHF 7m1 p.a. over 7 years)

OPEX
 One-time effects:
COGS


Financial
result
Financial
result

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1
Inventory adjustments / write-downs (approx. CHF 15m)
Accumulated FX differences on translation of initial 49% stake have to be
reclassified from equity into P/L (loss of approx. CHF 85m)
Revaluation before de-recognition of initial 49% stake (gain of approx.
CHF 15m)
Annual amortization charge will depend on BRLCHF exchange rate
Neodent – the flagship in our
value strategy
Marco Gadola, CEO
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Separate brand strategy to address premium and
value segments
Germany
(Option 30%)
Spain
(30%)
Brazil
(100%)
Germany
(51%)
Canada
(44%)
Germany
(100%)
Taiwan
(Convertible)
S. Korea
(Convertible)
US
(13%)
Austria
Taiwan
(49%)
Switzerland
(44%)
Common production &
technology platform
Premium
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Implants
CADCAM/prosthetics
Value
Regeneratives
Petra Rumpf joins Straumann to lead Instradent
 Petra Rumpf joins the Executive Management
Board as Head of Instradent & Strategic Alliances
 Past 7 years at Nobel Biocare in Corporate
Development, M&A, E-commerce, Training &
Education, Distributor Business
 Headed Nobel’s AlphaBio Tec value business
20
10
New solutions presented at key
trade events
Straumann launches holistic prosthetics
campaign targeted at dental labs worldwide
22
11
Strong presence at Chicago Midwinter, AO & IDS
events with special focus on labs
New visitor record (138 500) in Cologne
Dental Wings’ new intra-oral scanner…
Straumann booth at the IDS
and laser mill
Straumann booth at the AO
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More information on Straumann at the IDS
‘Analyst talk’ – video interview
www.youtube.com/watch?v=Q6yT5Jn3ZFc
‘Straumann connections’ – short video report
www.youtube.com/watch?v=TCxcc9f7ffw
Analyst and investor breakfast presentation
www.straumann.com/content/dam/internet/xy/resources/corporate/ir-conferencepresentations/en/Straumann_Investor%20Breakfast_12%20May%20IDS%20Cologne.pdf
Media presentation
www.straumann.com/content/internet/straumann_com/en/home/media/mediareleases/2015/tag_xml_newsbox_ch2015-03111491209digest/_jcr_content/par/newsdownload/linklist/file_2/file.res/Straumann___IDS_201
5_EN.pdf
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Strengthened position in lab segment with
original-on-original components
Variobase® abutment family
(also for the CEREC workflow)
CARES® X-Stream™
bridge-and-bar solutions
Straumann® pre-milled
abutment blanks
Innovative prosthetic
retention system by Valoc
3M™ ESPE™ Lava™ Plus
high translucency zirconia
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CEREC® is a registered trademark of Sirona Dental Systems GmbH, Germany.
Cutting-edge digital equipment solutions
Dental Wings intra-oral scanner
Straumann CARES®
3 & 7series scanners
+
Dental Wings laser mill
Straumann CARES® in-lab
mill by Amann Girrbach
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13
Bone Level Tapered implant roll-out underway
2014
Q3
Q4
2015
Q1
Q2
Q3
Q4
2016
2017
Q1-Q4
Q1-Q4
EMEA
- Germany, Austria & Switzerland CMR
- Europe (outside DACH)
FMR
CMR
FMR
- Distributors
CMR
N o r t h Am e r i c a
CMR
FMR
FMR
As i a P a c i f i c
- Japan1,2
FMR2
- China1,2
-
CMR
CMR
Distributors1
FMR
L a t i n Am e r i c a 1
CMR
FMR
CMR = controlled market release to collect feedback from experienced users
FMR = full market release, available to all customers.
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1
Depending on regulatory clearance in respective region/country
2
Roxolid not yet available
How the new products and technologies combine
in our strategy to be a ‘total solution provider’
Surgical
Full
regenerative
portfolio
(botiss)
BLT
PURE
Pre-milled
abutments
Variobase
for
CEREC
Abutments
Chairside
scanning
& milling
Removable
denture
attachment
(Valoc)
SR
abutments
Variobase
family
In-lab
milling
equipment
Restoration
Screw
retained
bars &
bridges
New inlab
scanner
CARES
X-Stream
DENTIST
Surgeon
GP / restorative
LABORATORY
Regional
Local
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14
Outlook 2015
Barring unforeseen circumstances
1
29

Further improvement in global implant market
expected. Revenue expected to grow organically
in mid-single-digit range.

Further investments in strategic growth markets
and projects

Cost reduction measures including compensation
reductions in CH, hiring and travel restrictions

2015 EBIT margin target >20% (organic1)

Neodent will be accretive to the Group’s reported
EBIT margin before acquisition-related one-time
effects.
Assuming exchange rates remain more or less at February levels (EURCHF 1.05 ; USDCHF 0.92)
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Questions & Answers
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15
Re-categorization1 of the 2014 regional revenues
REVENUE BY REGION
(in CHF millio n)
EMEA
Change in CHF in %
Change in local currencies in %
North America
Q1 2014
107.7
FY 2014
389.2
(8.4%)
5.4%
2.2%
0.3%
5.5%
3.2%
53.7
45.5
193.1
Change in CHF in %
18.1%
0.5%
6.3%
Change in local currencies in %
11.6%
5.2%
7.8%
Asia / Pacific
28.9
22.1
Change in CHF in %
30.4%
(2.4%)
8.4%
Change in local currencies in %
34.5%
8.3%
14.0%
LATAM
106.7
12.0
12.1
98.7
Change in CHF in %
163.1%
158.3%
419.2%
Change in local currencies in %
193.8%
205.4%
462.1%
Change in organic growth in %
11.7%
GROUP
31
Q1 2015
98.6
193.2
187.4
787.7
Change in CHF in %
7.4%
7.2%
15.8%
Change in local currencies in %
12.3%
10.5%
18.0%
Change in organic growth in %
8.2%
6.1%
6.4%
1 Owing to the Neodent consolidation Straumann has re-allocated markets from the ‘Rest of the World’ region to EMEA
and Latin America, with effect of 1 January 2015. The respective regional figures for 2014 in this table have been
restated accordingly and include Neodent’s external revenues from 1 March 2014 onwards.
Calendar of upcoming events
2015
12 June
Investor meetings
Sao Paulo
15 June
Investor meetings
Geneva
16 June
Investor meetings
London
07 July
Investor meetings
Lugano & Milano
20 August
H1 2015 results conference
Basel HQ
01 September
Investor meetings
Chicago
02 September
Investor meetings
New York
03 September
Investor meetings
Boston
09 September
Investor meetings
Zurich & St.Gallen
14 September
Investor meetings
Vienna
15 September
Investor meetings
Frankfurt
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Results publication and corporate events. More information on straumann.com → Events
32
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Straumann’s production foot-print
Andover (USA):
Implant production
Malmö (S):
Regenerative products
Leipzig (D):
CADCAM milling
Arlington (USA):
CADCAM milling
Villeret (CH):
Implant production
Curitiba (BR):
Implant production

Straumann
Your contacts
Fabian Hildbrand
Corporate Investor Relations
Tel.
+41 (0)61 965 13 27
Email
[email protected]
Mark Hill
Corporate Communications
Tel.
+41 (0)61 965 13 21
Email
[email protected]
Thomas Konrad
Tel.
Email
+41 (0)61 965 15 46
[email protected]
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International Headquarters
Institut Straumann AG
Peter Merian-Weg 12
CH-4002 Basel, Switzerland
Phone +41(0)61 965 11 11
Fax +41(0)61 965 10 01
www.straumann.com
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