Coloplast A/S Goldman Sachs Medtech Conference London, 7-8 September 2005 Sten Scheibye, CEO
2 Coloplast Coloplast products and services help patients achieve greater independence from medical challenges in 5 areas: Ostomy care, continence care, wound care, skin care and breast care. 39%* 24% 12% 5% 7% *Percentage of total group sales (2003/04)
3 History of revenue growth 1957-2004 7000 6000 5000 Forward integration mdkk 4000 3000 2000 1000 Danish production and sale through distributors Product divisions and subsidiaries Acquisitions 0 1957 1962 1967 1972 1977 1982 1987 1992 1997 2002
4 Sales and production world wide Sweden Switzerland Canada Germany Denmark Hungary Argentina Belgium France Poland Australia Italy Norway USA China Costa Rica Austria Japan Great Britain Holland Spain Portugal Croatia Czech Republic Israel Russia Slovakia Slovenia South Africa Brazil
5 Geographical distribution Revenue 2003/04 13% 6% 81% Europe The Americas ROW
6 Market conditions and response 1. Reimbursement changes Monitor/influence policy Product design Emphasis on clinical documentation 2. Price pressure Observe market trends Improve tendering capabilities Market growth influenced by: Earlier cancer detection Improved surgical procedures Increased longevity New technologies and treatment alternatives Conversion from older products 3. Harmonisation of health care systems Monitor development
7 Three key customers The end customer The user, primary concern is quality of life The health care professional The advisor, primary concerns are user quality of life and handling The payer Concern is primarily product pricing
8 Business Structure Group Management Corporate functions Sales Europe, North Europe, South Americas RoW Chronic Care segment Ostomy Care Continence Care Wound Care SBU segment Skin Health Breast Care V o l u m e p r o d u c t i o n
9 Ostomy Care - market data Global market value DKK 8-8½bn Europe (>4bn) USA (<2bn) Global (>8bn) 5% 6% 28% 2% 10% 35% 27% 24% 39% 55% 37% 4% 28% ConvaTec Coloplast Hollister B Braun Other Note: Only markets where Coloplast is present are included
10 Continence Care - market data Product area Market size and growth Coloplast market share (Europe) Coloplast growth Main competitors 1.5bn DKK 15% 43% 15-20% Astra Tech, Porges/Mentor, Rüsch, Rochester, B Braun 1.2bn DKK 0-5% 30% (value) 5% Bard, Hollister, Mentor, B Braun, Manfred Sauer, Unomedical 0.5bn DKK 0-3% >60% 0-3% Mentor, Hollister, Rochester, Manfred Sauer 1.0bn DKK - - No direct competitors 2%
11 Chronic Care - market conditions in Germany Market conditions Implementation of health care reform Introduction of patients co-payment for medical devices Reimbursement on auxiliary products removed OC draft for new prices CC draft for new prices CC final decision postponed OC final decision OC price reduction CC final decision Oct 03 Jan 04 Apr 04 Jul 04 Oct 04 Dec 04 Jan 05 Exp 2005/06 Market effects Stocking by users, additional sales De-stocking by users, dampened sales, higher admin. costs Retail anticipates lower prices, dampened sales. Alignment to changed market conditions
12 Chronic Care - US market positioning and key goals Strong product portfolio Convex baseplate, EasiClose Market access through GPO/IDN Consorta Large number of IDN contracts Significant growth in new patient discharge Sustained OC hospital growth > 30% Sustained OC/CC growth > 20% Reach two-digit ostomy market share within 3-5 years Develop intermittent coated catheter market segment
13 Wound Care - market definition Acute Wound type Chronic Product technology Dry wound healing Moist wound healing Pharma and biotech 1.5 billion 0.5 billion 1.0 billion 1.1 billion segment, growth 9-11% 0.1 billion 1.0 billion 0.4 billion Active VAC 0.4 billion 0.1 billion
14 Wound Care - market data MWH and active products, Europe 21% 10% 11% 14% 27% 17% Convatec Coloplast Mölnlycke S&N J&J Others Technology Traditional Advanced Active ConvaTec X X S&N X X Coloplast X X J&J X X X Mölnlycke X X
15 Skin Health and Breast Care SBU s Skin Health To treat skin problems arising from medical conditions or related to frequent hand washings 4bn DKK US market 3/4 of turnover generated in the US Hospitals and long term care institutions Breast Care Attached breast forms, partial breast shapers, special textiles 1bn DKK global market 50/50 sales value split between US and Europe Competitor overview American Airway BC Thämert Others TruLife Coloplast Anita
16 Expectations and targets 2004/05 Sales growth of 8-9% in local currencies Profit margin 15-16% 2008 Sales exceeding DKK 9 billion through organic growth Profit margin (EBIT) reaching 18% ROAIC of 20% Acquisitions and divestments
17 Key figures Q3 2004/05 mdkk 9 months 2004/05 9 months 2003/04 Index vs 2003/04 Revenue 4,786 4,468 107 EBIT 699 749 93 Special items -19 0 - Financial items -73-87 84 Profit before tax 607 662 92 Tax -192-226 85 Minority interests -1-3 33 Group profit 414 433 96 Profit margin 15% 17% -
18 Growth Q3 2004/05 - local currencies Growth Q3 2004/05 Growth H1 2004/05 Growth Q1 2004/05 Est. market growth Ostomy Care Continence Care Chronic Care segment* 9% 10% 9% 9% 9% 8% 9% 8% 6% 2-6% 5-8% Wound Care Skin Health Breast Care SBU segment 9% 8% 4% 7% 8% 7% (1)% 5% 4% 12% (3)% 4% 9-11% 9-12% (3)-(1)% Coloplast total 8% 7% 5% Europe Americas ROW 7% 11% 22% 5% 10% 23% 4% 8% 18% *Includes homecare Ostomy Care (39%) Continence Care (24%) Other (13%) Wound Care (12%) Breast Care (7%) Skin Health (5%)
19 Highlights markets Ostomy Care continues to outperform market growth - Solid US and RoW growth, restructuring in Germany - Corsinel well accepted, Strong Easiflex growth Continence Care growth by 10% - SpeediCath Compact still fuelling growth - New reimbursement prices in Germany expected in 2006 Wound Care sales increase of 9% - Growth back on track - Biatain Ag and Altreet Ag silver dressings introduced in France Breast Care sales rebound at 4% growth - Growth in both US and Europe
20 Tatabanya, Hungary Construction completed 700 headcounts by Aug. 2005 DKK 1.5bn sales value in 2005/06 EBIT up 5% compared with Danish manufacturing Coloplast, Phase I-III, Tatabanya, Hungary Phase I - finalised: ostomy bags, urisheaths Phase II - finalised: ostomy bags, dressings, catheters Phase III - finalised 2005: Assura ostomy bags, baseplates, adhesives
21 Staff requirements by geography 2.000 Total staff requirements (FTEs) by geography, 2003/04-2010/11 FTEs 1.500 1.000 500 DK HU CN 0 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11
Cash flow 1500 1000 500 0-500 -1000-1500 Acquisitions Investments Cash flow Free cash flow 22 3Q 04/05 03/04 02/03 01/02 00/01 99/00 98/99 97/98 mdkk 96/97
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