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    ROVI   ES0157261019

LABORATORIOS FARMACEUTICOS ROVI, S.A.

(ROVI)
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Laboratorios Farmaceuticos Rovi S A : ROVI releases the presentation related to the first quarter 2020 financial results

05/13/2020 | 02:20am EDT

F I R S T Q U A R T E R 2 0 2 0 F I N A N C I A L R E S U L T S

M A Y 2 0 2 0

Disclaimer

  • This Presentation has been prepared by Laboratorios Farmacéuticos Rovi, S.A. (the "Company") and comprises the slides for a presentation concerning the Company and its subsidiaries (the "Group"). For the purposes of this disclaimer, "Presentation" means this document, its contents or any part of it, any oral presentation, any question or answer session and any written or oral material discussed or distributed during the Presentation meeting or otherwise in connection with it.
  • This Presentation does not constitute or form part of, and should not be construed as, any offer to sell or issue or invitation to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for, any securities of the Company, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision.
  • The information contained in this Presentation does not purport to be comprehensive. None of the Company, its respective subsidiaries or affiliates, or its or their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to the truth, fullness, accuracy or completeness of the information in this Presentation (or whether any information has been omitted from the Presentation) or any other information relating to the Group, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this Presentation or its contents or otherwise arising in connection therewith. Each of such persons accordingly disclaims all and any liability whatsoever, whether arising in tort, contract or otherwise in respect of this Presentation or any such information.
  • The information in this Presentation may include forward-looking statements, which are based on current expectations, projections and assumptions about future events. These forward-looking statements as well as those included in any other information discussed in the Presentation are subject to known or unknown risks, uncertainties and assumptions about the Group and its investments, including, among other things, the development of its business, its growth plan, trends in its operating industry, its future capital expenditures and acquisitions. In light of these risks, uncertainties and assumptions, the events in the forward-looking statements may not occur and actual results, performance or achievements may materially differ from any future results, performance or achievements that may be expressed or implied in this Presentation. No representation or warranty is made that any forward-looking statement will come to pass. Forward-looking statements speak as of the date of this Presentation and no one undertakes to publicly update or revise any such forward-looking statement, whether as a result of new information, future events or otherwise. Accordingly, undue reliance should not be placed on any forward-looking statement contained in this Presentation.
  • To the extent available, the industry, market and competitive position data contained in this Presentation come from official or third party sources. Third party industry publications, studies and surveys generally state that the data contained therein have been obtained from sources believed to be reliable, but that there is no guarantee of the accuracy or completeness of such data. While the Company reasonably believes that each of these publications, studies and surveys has been prepared by a reputable source, the Company has not independently verified the data contained therein. In addition, certain of the industry, market and competitive position data contained in this Presentation come from the Company's own internal research and estimates based on the knowledge and experience of the Company's management in the markets in which the Group operates. While the Company reasonably believes that such research and estimates are reasonable and reliable, they, and their underlying methodology and assumptions, have not been verified by any independent source for accuracy or completeness and are subject to change. Accordingly, undue reliance should not be placed on any of the industry, market or competitive position data contained in this Presentation. This Presentation also includes certain alternative performance measures ("APMs") that have not been prepared under IFRS-EU and have not been reviewed or audited by the Company's auditors nor by any independent expert. Moreover, the way the Group defines and calculates these measures may differ to the way similar measures are calculated by other companies. Accordingly, they may not be comparable.
  • Certain financial and statistical information contained in this Presentation is subject to rounding adjustments. Accordingly, any discrepancies between the totals and the sums of the amounts listed are due to rounding. Certain financial information and operating data relating to the Company contained in this Presentation has not been audited and in some cases is based on management information and estimates, and is subject to change.
  • No reliance may or should be placed by any person for any purposes whatsoever on this Presentation, or on its completeness, accuracy or fairness. The information in this Presentation is in summary draft form for discussion purposes only. The information and opinions contained in this Presentation are provided as at the date of the Presentation and are subject to verification, correction, completion and change without notice. In giving this Presentation, none of the Company, its subsidiaries or affiliates, or its or their respective directors, officers, employees, advisers or agents, undertakes any obligation to amend, correct or update this Presentation or to provide the recipient with access to any additional information that may arise in connection with it.

Operating results

Q1 2020 financial results - Highlights

  • Operating revenue increased by 23% to €101.0Mn in Q1 2020, driven by the strength of the specialty pharmaceutical business, where sales rose 24%, strongly outperforming the market, and by the toll manufacturing business, which grew by 19%. Total revenue increased by 23% to €101.2Mn in Q1 2020. This significant increase is partially due to the extraordinary sales in March as a result of the medicine stockpiling by the entire distribution chain due to the Covid-19 crisis.
  • For 2020, ROVI expects a mid-single-digit growth rate for the operating revenue. Notwithstanding, given the uncertainties associated to the development of the Covid-19pandemic and the duration of the State of Alarm, it is not yet possible to make a precise assessment of the impact that the pandemic will have on the current year. ROVI expects the main negative impact on group sales to take place in the second quarter of 2020.
  • Sales of the heparin franchise (Low Molecular Weight Heparins (LMWH) and other heparins) increased by 42% to €55.6Mn in Q1 2020. Heparin sales represented 55% of operating revenue in Q1 2020 compared to 48% in Q1 2019. Sales of LMWH (Enoxaparin biosimilar and Bemiparin) increased by 43% to €53.9Mn in Q1 2020. Sales of the Enoxaparin biosimilar amounted to €29.6Mn (+79%) in Q1 2020 and positive performance of Bemiparin (+15% to €24.3Mn).
  • Sales of Neparvis, launched in December 2016, increased 85% to €7.9Mn in Q1 2020.
  • EBITDA increased by 68%, from €11.9Mn in Q1 2019 to €20.0Mn in Q1 2020, reflecting a 5.3 pp rise in the EBITDA margin to 19.8% in Q1 2020.
  • Net profit increased by 102%, from €6.9Mn in Q1 2019 to €13.9Mn in Q1 2020.
  • ROVI filed its application for marketing authorisation for Doria® with the European health authorities, the European Medicines Agency (EMA), through the Centralised Procedure on 27 December, 2019. After passing the validation phase satisfactorily, the dossier was admitted for evaluation on 30 January, 2020.

1

Growth driven by specialty pharma and toll manufacturing businesses…

Total operating revenue (€Mn)

Operating revenue growth by category (€Mn)

120

+23%

120

101,0

100

12,7

82,2

+19%

80

80

10,7

60

101,0

+24%

88,2

40

82,2

40

71,4

20

0

0

Q1 2019

Q1 2020

Q1 2019

Q1 2020

Specialty pharma

Toll manufacturing

  • Operating revenue increased by 23% to €101.0Mn in Q1 2020 driven by the strength of:
    • the specialty pharmaceutical business, where sales rose 24%; and
    • the toll manufacturing business, which grew by 19%.

2

…with high profitability

EBITDA (€Mn) and EBITDA margin (%)

19,8%

20%

+68%

20

14,4%

15%

20,0

15

10%

11,9

10

5%

5

0%

0

Q1 2019

Q1 2020

EBITDA

EBITDA margin

Net profit (€Mn)

15

+102%

10

13,9

5

6,9

0

Q1 2019

Q1 2020

  • EBITDA increased by 68%, from €11.9Mn in Q1 2019 to €20.0Mn in Q1 2020, reflecting a 5.3 percentage point rise in the EBITDA margin to 19.8% in Q1 2020.
  • Net profit increased by 102%, from €6.9Mn in Q1 2019 to €13.9Mn in Q1 2020.

3

Heparins, leading the specialty pharmaceutical business

Prescription-based pharma products sales (€Mn)

80

+27%

60

40

79,7

62,7

20

0

Q1 2019

Q1 2020

Heparin franchise sales (€Mn)

60%

55,1%

60

47,6%

40%

55,6

40

20%

39,1

20

0%

0

Q1 2019

Q1 2020

Heparins

Heparins/operating revenue

  • Sales of prescription-based pharmaceutical products increased by 27% to €79.7Mn in Q1 2020.
  • Sales of the heparin franchise (Low Molecular Weight Heparins (LMWH) and other heparins) increased by 42% to 55.6 million euros in Q1 2020.
  • Heparin sales represented 55% of operating revenue in Q1 2020 compared to 48% in Q1 2019.

4

Well Positioned to Drive Long-Term Leadership in Low Molecular Weight Heparins (LMWH)

LMWH sales (€Mn)

Bemiparin sales (€Mn)

60

40

20

0

24,3

+43%

53,9

25

21,1

+15%

6,0

20

3,5

+69%

37,6

+79%

29,6

15

16,5

+15%

10

+4%

17,6

18,3

21,1

24,3

5

0

Q1 2019

Q1 2020

Q1 2019

Q1 2020

Bemiparin

Enoxaparin biosimilar

Spain

International sales

Sales of LMWH (Enoxaparin biosimilar and Bemiparin) increased by 43% to €53.9Mn in Q1 2020.

  • Sales of the Enoxaparin biosimilar amounted to €29.6Mn (+79%) in Q1 2020.
  • Bemiparin total sales increased by 15% to €24.3Mn in Q1 2020:
    • Sales in Spain increased 4% to €18.3Mn.
    • International sales increased by 69% to €6.0Mn. This significant increase was specifically linked to Q1 2020 and ROVI expects international Bemiparin sales to decrease by a mid-single-digit percentage in 2020.

5

Strong growth potential of Enoxaparin Biosimilar Becat®

Strong Commercial Launch with a Clear Strategy

Well-Established Network to Minimize Time-to-Market

  • ROVI launched enoxaparin biosimilar Becat® in Germany (first EU market) in September 2017; in UK, Italy, Spain, France1, Austria, Latvia and Estonia in 2018; and in Portugal, Poland, Costa Rica, Finland and Sweden in 2019.
  • Newly-establishedEuropean sales offices provide pan-Europeaninfrastructure that is highly leverageable for further growth of ROVI's heparin franchise and broader portfolio.

Enoxaparin Biosimilar Becat® Sales Ramp-up

VERY POSITIVE EVOLUTION OF ENOXAPARIN BIOSIMILAR

BECAT® SALES SINCE LAUNCH IN 4Q17

+79%

Direct

Marketed in

Approved in

Pending

Germany, UK,

26 countries in

Launched in 13

Europe and 6

approval in

70

Italy, Spain,

countries

in the Rest of

countries

Portugal and

the World

Poland

Stage I of Commercial Strategy

Focus on Europe…

ROVI will directly market

enoxaparin biosimilar

In the long-term,

Becat® in 7 European

biosimilars tend to

countries…

reach a…

30

25

€m

+2.7x

€80.9Mn

50-70%

Market Share5

20

…the largest enoxaparin

…which account for

market with €0.9bn

c.75% of the European

sales3

market4

…of the reference

product market

15

10

5

€30.2Mn

29,6

20,0

28,0

1,5

4,1

4,8

7,8

13,5

16,5

16,3

Stage II of Commercial Strategy

Continue international expansion in other markets with strong growth potential through out-licensing agreements

Already Signed Out-Licensed Agreements: 87 Countries

€0.5bn 13.9%

20192019 Market Sales3 Market Growth3

0

Q4 2017

2

Q2 2018

Q3 2018

Q4 2018

Q1 2019

Q2 2019

Q3 2019

Q4 2019

Q1 2020

Q12018

ROVI signed a licensing agreement with Sandoz to distribute enoxaparin biosimilar Becat® in 14 countries/regions and with Hikma in 17 Middle East and North African countries.

1.

ROVI has started to sell Becat® in France though Biogaran

4.

QuintilesIMS, 2015.

2.

Becat® 4Q 2017 sales include sales throughout September. As the product was launched that month, sales were negligible.

5.

Technavio 2016 biosimilars report.

3.

Estimates based on Sanofi-Aventis reported 2019 sales.

6

Strong performance of the product portfolio (1/2)

Neparvis sales (€Mn)

8

6+85%

4

7,9

24,3

0

Q1 2019

Q1 2020

Medicebran and Medikinet sales (€Mn)

3

-49%

2

1

2,1

1,1

0

Q1 2019

Q1 2020

Volutsa sales (€Mn)

4

+23%

3

2

3,1

3,8

1

0

Q1 2019

Q1 2020

  • Sales of Neparvis, a specialty product from Novartis launched in December 2016, increased by 85% to €7.9Mn in Q1 2020, from €4.3Mn in Q1 2019.
  • Sales of Volutsa, launched in Spain in February 2015, increased by 23% to €3.8Mn in Q1 2020.
  • Sales of Medicebran and Medikinet, products launched in December 2013 and marketed on exclusivity basis by ROVI in Spain, decreased 49% to €1.1Mn in Q1 2020. In July 2019, Medikinet® (methylphenidate hydrochloride with a modified release) went out of protection for galenic innovation and its price was reduced by 50.3% on average.

Neparvis is a specialty product from Novartis indicated for the treatment of adult patients with symptomatic chronic heart failure and reduced ejection fraction.

Volutsa is a specialty product from Astellas Pharma indicated for the treatment of moderate to severe storage symptoms and voiding symptoms associated with benign prostatic hyperplasia. Medicebran and Medikinet are specialty products from Medice indicated for the treatment of ADHD in children and teenagers.

7

Strong performance of the product portfolio (2/2)

Absorcol, Vytorin and Orvatez sales (€Mn)

Hirobriz and Ulunar sales (€Mn)

10

+31%

4

8

3

6

9,5

2

3,8

3,8

4

7,3

1

2

0

0

Q1 2019

Q1 2020

Q1 2019

Q1 2020

Contrast imaging agents sales (€Mn)

10

+1%

8

6

4

8,2

8,3

2

0

Q1 2019

Q1 2020

  • Sales of Vytorin®, Orvatez® and Absorcol® increased by 31% to €9.5Mn in Q1 2020. In Q2 2018, the active principle ezetimibe went out of patent and the price of Absorcol® was reduced. Likewise, generics formulated with ezetimibe and simvastatin were marketed in the same period, so the price of Vytorin® was reduced to be competitive. In addition, Orvatez® price is expected to be reduced by 30% throughout the first half of 2020 due to the entrance of hybrid products formulated with ezetimibe and atorvastatine.
  • Sales of Hirobriz and Ulunar, both products for patients with COPD, launched in Spain in Q4 2014 remained stable at €3.8Mn in Q1 2020.
  • Contrast imaging agents and other hospital products increased by 1% to €8.3Mn in Q1 2020. This slight increase is mainly due to the significant reduction in the number of diagnostic tests performed during the period of confinement.

Vytorin, Orvatez and Absorcol, the first of the five licenses of MSD, are indicated for the treatment of hypercholesterolemia.

Hirobriz Breezhaler and Ulunar Breezhaler are both products from Novartis indicated for the treatment of COPD (Chronic Obstructive Pulmonary Disease).

8

Value added toll manufacturing services

Toll manufacturing sales (€Mn)

Toll manufacturing sales increased by 19% to 12.7 million euros in Q1 2020 as

15

a result of the redirection of our toll manufacturing activities strategy towards

high-value-added products.

+19%

In November 2019, the toll manufacturing management units, ROVI Contract Manufacturing and Frosst Ibérica, merged into a single entity, ROVI Pharma Industrial Services, which furnishes manufacturing services with the highest degree of quality and competitiveness. The total integration of the production

10processes is expected to allow the company to attain greater synergies and levels of efficiency in its industrial operations.

12,7

510,7

0

Likewise, by the end of 2020, ROVI expects the toll manufacturing business to have increased by a low-double-digit percentage.

Q1 2019

Q1 2020

9

  • ISM® Platform Opens Up New Avenues of Growth for ROVI

Overview

Key Company Highlights of ISM® Platform

  • Internally-developedand patented innovative drug-release technology, ISM®1, which allows for the sustained release of compounds administered by injection
    • Based on two separate syringes respectively containing (a) the drug and polymer (solid state) and (b) the solvent (liquid state)
  • Potential wide applicability of ISM® technology to new chronic therapeutic areas, including psychiatry and oncology
    • 505(b)(2) path of approval for candidates leveraging ISM® technology

2 Candidates Currently in Clinical Trials

Product

Potential Indication

Current Situation

Key Milestones

Non-

I

II

III

Clinical

DORIA®

Positive results from Phase

Risperidone,

Schizophrenia

III. Filed in Europe.

monthly

Letrozole

Phase I started in

ISM®

Breast Cancer

November 2017

Long acting

Letrozole

Risperidone,

Schizophrenia

quarterly

Concentrated on improving posology for already approved compounds, which benefits risk / reward profile

Pop PK 2 model & simulations

1 Predictability already validated for DORIA® in Phase I & II Clinical Program

2

Usability

Improved stability

Selecting the most convenient

3 Flexibility posology depending on clinical needs

Improved

Long acting injection (LAI)

4

Clinical

(1-6 months) plasma therapeutic

Management

levels from day 1

Technological barriers (e.g.

5

Vertical

power filling)

Integration

Strong IP

Manufacturing capabilities

Expected high

success rate in

Phase III

No cold chain

needed

From 1 to 6-month

administration

Rapid onset & sustained clinical

effect

  • Protected

technology

Fully integrated manufacturing

plants

Multiple FDA / GMP approved facilities to support the platform

  1. ISM® stands for In Situ Microparticles®.
  2. PK stands for pharmacokinetic.

10

Guidance 2020

2020 operating revenue growth rate

Mid-single-digit

T H E K E Y G R O W T H L E V E R S I N 2 0 2 0

Specialty Pharma Business

  • Bemiparin
  • Biosimilar of Enoxaparin
  • Launches such as Neparvis and Volutsa
  • Existing portfolio of specialty pharmaceuticals
  • New acquisitions (Falithrom, Polaramine and sodium heparin)

Toll Manufacturing Services

  • Spare capacity in the manufacturing plants
  • New customers to be acquired
  • Given the uncertainties associated to the development of the Covid-19 pandemic, it is not yet possible to make a precise assessment of the impact that the pandemic will have on 2020. ROVI expects the main negative impact on group sales to take place in Q2 2020.
  • The potential increase in the discounts to the National Health System as a result of the Covid-19 impact may affect attainment of these growth forecasts.

11

Financial results

Good revenue level with outstanding LMWH sales growth

Total operating revenue (€Mn)

LMWH sales (€Mn)

120

80

40

0

+23%

101,0

82,2

0,2

+19%

12,7

0,6

8,3

+1%

10,7

8,2

+27%

79,7

62,7

60

+43% 53,9

40

37,6

29,6

+79%

16,5

20

21,1

+15%

24,3

0

Q1 2019

Q1 2020

Q1 2019

Q1 2020

Prescription products

Contrast agents & other hospital products

Toll manufacturing

Other

Bemiparin

Enoxaparin biosimilar

  • Operating revenue increased by 23% to €101.0Mn, achieved on:
    • 27% growth in prescription-based products;
    • 1% growth in contrast agents and other hospital products;
    • 19% increase in toll manufacturing; and
    • OTC and other revenues decreased by 58%.
  • Sales of LMWH increased by 43% to €53.9Mn in Q1 2020.
    • Enoxaparin biosimilar sales increased by 79% to €29.6Mn and Bemiparin sales increased by 15%.

13

Gross margin impacted by the increase of enoxaparin biosimilar sales and the increase of LMWH raw material prices

Gross profit (€Mn) and Gross margin (%)

60%

57,0%

54,7%

50%

+18%

40%

30%

55,2

46,8

20%

10%

0%

Q1 2019

Q1 2020

60

40

20

0

Gross profit increased by 18% to €55.2Mn in Q1 2020, the gross margin showing a decrease of 2.3 pp from 57.0% in Q1 2019 to 54.7%, mainly due to:

  • the €4.6Mn increase in potential discounts to the National Health System as a result of the health crisis related to the Covid-19;
  • the increase of Enoxaparin biosimilar sales, which added lower margins in Q1 2020 after the launch of the product in three new markets; and
  • the increase in the LMWH raw material prices (due to the African swine fever), which, in Q1 2020, were running around 40% over Q1 2019 prices.

ROVI expects this upward trend in low-molecular-weight heparin raw material prices to increase during the first part of 2020. This, together with the uncertainty about the potential impact of the Covid-19, makes the impact of these issues on the 2020 gross margin unpredictable at the present date.

Gross profit

Gross margin

14

Cost control along with commitment to R&D

SG&A expenses (€Mn)

R&D expenses (€Mn)

40%

34,1%

+10%

30,5%

30

8

-35%

6

30%

20

30,8

4

20%

28,0

6,9

10%

10

2

4,5

0

0%

0

Q1 2019

Q1 2020

Q1 2019

Q1 2020

SG&A

SG&A/operating revenue

  • SG&A expenses rose 10% to €30.8Mn in Q1 2020 mainly due to:
    • a larger volume of enoxaparin biosimilar production;
    • the increase of €1.0Mn in personnel and other expenses related to the Covid-19 measures implemented; and
    • international subsidiaries expenses (including Portugal) which amounted to €2.4Mn compared to €2.2Mn in Q1 2019.
    • Excluding expenses related to Covid-19, SG&A would have increased by 6% to €29.7Mn in Q1 2020.
    • In 2020, expenses related to international subsidiaries are expected to be around €10Mn.
  • R&D expenses decreased 35% to €4.5Mn in Q1 2020. These expenses are related to:
    • the preparation of the Doria® registration dossier to be submitted to the U.S. Food and Drug Administration (FDA);
    • the development of the Letrozole-ISM® Phase I trial; and
    • the development of a new formulation of Risperidone-ISM® for a 3-monthly injection.

15

EBITDA

EBITDA (€Mn) and EBITDA margin (%)

19,8%

20%

+68%

20

14,4%

15%

15

10%

20,0

10

11,9

5

5%

0%

0

Q1 2019

Q1 2020

EBITDA

EBITDA margin

2019 EBITDA impacts (€Mn)

Note: EBITDA "pre-R&D" calculated excluding R&D expenses in Q1 2020 and Q1 2019

EBITDA (€Mn) and EBITDA "pre-R&D" margin (%)

30%

+30%

24,2%

30

22,9%

25%

25

20%

20

15%

24,5

15

10%

18,8

10

5%

5

0%

0

Q1 2019

Q1 2020

EBITDA "pre R&D"

EBITDA margin "pre R&D"

  • EBITDA increased by 68% to €20.0Mn in Q1 2020, reflecting a 5.3 pp rise in the EBITDA margin, which was up to 19.8% in Q1 2020 from 14.4% in Q1 2019.
  • EBITDA "pre-R&D" increased by 30% to €24.5Mn in Q1 2020, reflecting a 1.4 pp rise in the EBITDA margin to 24.2% in Q1 2020. Likewise,
    • recognising the same amount of R&D expenses in Q1 2020 as in Q1 2019, EBITDA would have increased by 48% to €17.5Mn, reflecting a 2.9 pp rise in the EBITDA margin to 17.4% in Q1 2020.
  • EBITDAC (Earnings Before Interest, Taxes, Depreciation, Amortization and Coronavirus) increased to €21.0Mn in Q1 2020, a rise of 77% compared to the same period of the previous year, reflecting a 6.3 pp increase in the EBITDAC margin, which was up to 20.8% in Q1 2020 from 14.4% in Q1 2019.

16

EBIT

EBIT (€Mn) and EBIT margin (%)

15%

15,0%

16

13%

9,2%

12

10%

+101%

8%

15,1

8

5%

7,5

4

3%

0%

0

Q1 2019

Q1 2020

EBIT

EBIT margin

2019 EBIT impacts (€Mn)

Note: EBIT "pre-R&D" calculated excluding R&D expenses in Q1 2020 and Q1 2019.

EBIT (€Mn) and EBIT "pre-R&D" margin (%)

25%

25

19,4%

20%

20

17,6%

15%

+36%

15

10%

19,6

10

14,4

5%

5

0%

0

Q1 2019

Q1 2020

EBIT "pre R&D"

EBIT margin "pre R&D"

  • Depreciation and amortisation expenses increased by 12% to €4.8Mn in Q1 2020.
  • EBIT increased to €15.1Mn in Q1 2020, reflecting a 5.8 pp rise in the EBIT margin, which was up to 15.0% in Q1 2020.
  • EBIT "pre-R&D" increased by 36%, from €14.4Mn in Q1 2019 to €19.6Mn in Q1 2020, reflecting a 1.9 pp rise in the EBIT margin to 19.4% in Q1 2020. Likewise,
    • recognising the same amount of R&D expenses in Q1 2020 as in Q1 2019, EBIT would have increased by 69% to €12.7Mn, reflecting a 3.4 pp rise in the EBIT margin.

17

Net profit

Net profit (€Mn)

15

+102%

10

13,9

5

6,9

0

Q1 2019

Q1 2020

Net profit "pre-R&D" (€Mn)

20

+35%

15

10

18,0

13,3

5

0

Q1 2019

Q1 2020

  • Net profit increased to €13.9Mn in Q1 2020, a 102% rise compared to Q1 2019.
  • Net profit "pre R&D" increased by 35%, from €13.3Mn in Q1 2019 to €18.0Mn in Q1 2020. Likewise,
    • recognising the same amount of R&D expenses in Q1 2020 as in Q1 2019, net profit would have increased by 70% to €11.7Mn.
  • The effective tax rate was 9.6% in Q1 2020, compared to 6.9% in Q1 2019, mainly due to the recognition in 2019 of negative tax bases ROVI had the right to use. R&D tax credits decreased in Q1 2020 as a result of the decrease in R&D expenses in Q1 2020 compared to the same period of the previous year.
  • As of 31 March 2020, negative tax bases of the Group amounted to €34.9Mn, of which €8.3Mn will be used in the 2019 income tax and €0.8Mn in Q1 2020.

Note: Net profit "pre-R&D" calculated excluding R&D expenses in Q1 2020 and Q1 2019. Same effective tax rate as the reported net profit.

18

Capital expenditure and Free Cash Flow

Capex evolution (€Mn)

Capex breakdown (%)

Escuzar

4

facility; 6%

Injectables;

21%

-10%

3

ISM

industrialization;

Granada

35%

facility; 6%

2

3,3

3,0

Maintenance

1

capex and

Alcalá facility;

other; 16%

San Sebastián

8%

0

de los Reyes

€3.0Mn of capex invested in Q1 2020.

facility; 9%

Q1 2019

Q1 2020

€0.6Mn of investment capex related to the injectable plant (Madrid);

Free Cash Flow (€Mn)

€0.2Mn of investment capex related to the Granada facility;

€0.2Mn of investment capex related to the Alcalá de Henares facility;

0

-3,1

€0.3Mn of investment capex related to the San Sebastián de los Reyes facility;

€1.0Mn of investment capex related to the ISM® industrialization;

-5

€0.2Mn of investment capex related to the Escuzar facility; and

€0.5Mn of maintenance capex and other capex

  • €13.5Mn invested in Q1 2019 for the acquisition of Polaramine®.

-10

-19,0

FCF decreased to €-3.1Mn mainly due to:

€13.8Mn increase in capex mainly because of the acquisition of Polaramine® in Q1 19;

-15

€8.0Mn increase in profit before income tax;

€8.9Mn increase in "trade and other payables" in Q1 2020 vs €1.9Mn increase in Q1

2019;

-20

€34.0Mn increase in "inventories" in Q1 2020 vs €13.2Mn increase in Q1 2019;

Q1 2019

Q1 2020

€2.5Mn increase in "trade and other receivables" in Q1 2019 vs €1.7Mn increase in

Q1 2020.

19

Financial debt

Debt breakdown by source (%)

Debt maturities by year (€Mn)

60

Total debt

Financial

€76.7Mn

liabilities for

leases; 26%

40

Bank

borrowings;

53,4

59%

Debt with public

20

adminsitration;

15%

4,5

4,7

4,5

9,6

0

2020

2021

2022

2023

2024 onwards

  • Debt with public administration represented 15% of total debt, with 0% interest rate.
  • Gross cash position of €57.7Mn as of 31 March 2020 vs €68.9Mn as of 31 December 2019.
  • Net debt of €19.0Mn as of 31 March 2020 vs €15.9Mn as of 31 December 2019.
  • In February 2020, ROVI announced it would pay a dividend of 0.1751 euros per share with dividend rights out of the 2019 profit if the Shareholders General Meeting approved the application of the 2019 profit proposed by ROVI's Board of Directors. This proposed dividend would mean an increase of 119% on the dividend paid out of the 2018 profit (€0.0798/share) and represents a 25% pay-out. As a result of the Covid-19 crisis, ROVI has postponed the General Shareholders Meeting and has placed the dividend proposal under review.

20

News-flow 2020

Specialty

Pharma

Sales of biosimilar of Enoxaparin

Additional new products to be launched

Granting by the competent local authorities of the marketing authorisation of an Enoxaparin biosimilar in 70 countries outside Europe

Toll

New contracts to be announced

manufacturing

Risperidone ISM® expected to be filed in USA in H2 2020

ISM® Risperidone ISM® final Phase III data will be presented in scientific congresses

technology

platform

Next steps of Letrozole ISM® to be discussed with regulatory authorities in 2020

21

For further information, please contact:

Juan López-Belmonte Chief Executive Officer +34 91 3756235 jlopez-belmonte@rovi.eswww.rovi.es

Javier López-Belmonte Chief Financial Officer +34 91 3756266 javierlbelmonte@rovi.es www.rovi.es

Marta Campos Investor Relations +34 91 2444422 mcampos@rovi.es www.rovi.es

Disclaimer

Laboratorios Farmacéuticos ROVI SA published this content on 13 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 May 2020 06:19:04 UTC


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Number of Analysts 9
Last Close Price 51,40 €
Average target price 76,41 €
Spread / Average Target 48,7%
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Juan López-Belmonte Encina Chairman, President & Chief Executive Officer
Javier López-Belmonte Encina Chief Financial Officer & Executive Director
Ibón Gutierro Adúriz Manager-Research & Development
José Fernando de Almansa Moreno-Barreda Independent Director
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