Animal Health Group plc AUDITED RESULTS FOR THE …/media/Files/E/Eco... · · 2012-08-14Animal Health Group plc AUDITED RESULTS FOR THE YEAR ... Group control and re-establishes

Animal Health Group plc AUDITED RESULTS FOR THE YEAR

ENDED 31 MARCH 2012

Peter Lawrence – Chairman

Marc Loomes – Chief Executive

Brett Clemo- Director

JULY 2012

www. ecoanimalhealthgroupplc.com www.ecoanimalhealth.com www.aivlosin.com

http://www.lawrenceplc.com/

http://www.ecoanimalhealth.com/

2 Animal Health Group plc

Disclaimer

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Operational highlights

Fourth consecutive year of continuing growth

in sales and EBITDA

Aivlosin®

Accounted for almost 65% of sales

Surges ahead following launches in newer markets

Registrations

USA – first Aivlosin®

approval for WSG for pigs- launch September

Canada – granted the same and launched March

Total $ sales up over 10%


R² = 0.9893

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

2005 2006 2007 2008 2009 2010 2011 2012

CONSOLIDATED AIVLOSIN SALES 2005 - 2012

Consolidated Sales Poly. (Consolidated Sales)

Sale

s G

B£

(0

00

)

New Chinese distributor and new EU respiratory claim

EU enteric claims approved and launch in Chile

Transfer of licenses to ECO Brazil

Japanese relaunch with new claims and distributor

Change of distribution route in EU

EU Water Soluble Granules approvals

AIVLOSIN SALES SURGE AHEAD


Key figures 2012 vs 2011

Revenues

£ 28.3m

+5 %

EBITDAI

£ 6.5m

+150k

EPS

4.2p

+38%

Net Cash

£ 9.5m

+£100k

Profit after Tax

£ 2.6m

+32 %


A Year of Investment into New Markets

R&D

Investigations into new indications continue to show encouraging

results

Pharmgate Animal Health Canada

First venture into North America for Aivlosin now recovering over £150k

start up costs

Pharmgate Animal

Health USA

Will begin to recover 2 years of start up costs totalling over £350k

ECO Mexico

Brings authorisations within Group control and

re-establishes presence in a key market


A Year of Advances – Sales

Indian Subcontinent

+40% to £ 1.4m

China

+7% to £ 6.1m

Latin America

+24% to £ 9.6m

ROW

+5% to £ 4.6m


New Markets this Year

Canada

Nigeria

Middle East

USA, Russia and Korea to follow


Aivlosin: CANADA

Water soluble granule formulation for treatment of PPE (ileitis) in pigs

“Below the radar” launch to independent and early adopter veterinarians in March

First product shipped

Feedback very positive ~ restricted supply situation now eased

Premix formulation going through Regulatory approval


Aivlosin: USA

Water soluble granule formulation for treatment of PPE (ileitis) in pigs approved in July 2012

First shipments expected September 2012

Recruitment of sales and technical support staff started

Premix formulation going through Regulatory approval

The first oral antibiotic for swine to be registered in the USA for 6 years


AUDITED INCOME STATEMENT SUMMARY

Turnover

Gross profit

Profit on ordinary activities before tax

Profit on ordinary activities after tax

EBITDA*

Earnings per share

Note : Profit Before Tax

Depreciation/Amortisation

Net Interest (received)/paid

Foreign exchange differences

Share based payments

*EARNINGS BEFORE INTEREST,TAX, DEPRECIATION,

AMORTISATION, SHARE BASED PAYMENTS, FOREX DIFFERENCES AND MINORITIES

Net cash

Year ended

31 Mar 12

£’000

28,322

10,818

2,320

2,627

6,520

4.24 pence

£

2,320,342

3,691,584

(115,504)

332,411

290,890

6,519,723

9,509,732

Year ended

31 Mar 11

£’000

27,078

10,713

2,292

1,994

6,370

3.07 pence

£

2,291,616

3,328,491

177,741

268,757

303,504

6,370,109

9,418,341

Eco Animal Health Group plc


ECO Animal Health Group plc

SUMMARISED AUDITED BALANCE SHEET AS AT

INTANGIBLE ASSETS

TANGIBLE ASSETS

INVESTMENTS

STOCKS

TRADE AND OTHER RECEIVABLES

CORPORATION TAX RECOVERABLE

CASH IN HAND

PAYABLES:

BANK BORROWINGS

TRADE AND OTHER PAYABLES

CORPORATION TAX

DIVIDENDS

NET CURRENT ASSETS

PAYABLES>1 YEAR

DEFERRED TAX PROVISION

SHARE CAPITAL AND PREMIUM

TREASURY RESERVE

RETAINED EARNINGS

OTHER RESERVES

MINORITIES

TOTAL EQUITY

NOTE: MARKETING AUTHORISATION EXPENDITURE 2012

TOTAL MARKETING AUTHORISATION COST CARRIED FORWARD

31 March

2012

£

39,109,147

1,422,836

8,738

4,417,317

11,047,572

15,921

14,002,422

-4,492,690

-6,863,563

-58,084

-31,122

18,037,773

-330,379

58,248,115

40,362,877

-5,217,580

15,938,372

5,272,859

1,891,587

58,248,115

4,063,647

39,524,095

31 March

2011

£

38,636,816

1,277,586

350,888

4,803,929

9,737,529

355,667

9,471,537

-53,196

-5,872,021

-77,529

-32,369

18,333,547

-831,861

57,766,976

48,878,858

-

5,221,761

1,875,770

1,790,587

57,766,976

4,269,988

35,397,239


Growth continues to be driven by........

Consolidation Cost of goods reduction and supply chain management Margin improvement with increased Aivlosin sales Technology transfer royalty decreased and 3 years to run

Organic development Ongoing for other indications – including for egg laying birds Strong focus on new countries (USA, Russia, Korea) New subsidiary in Mexico Extending collaboration with Universities

China

Advanced stage of collaborative venture will strengthen supply route of Aivlosin API

New market for poultry with existing registrations


Outlook

Strong start to the year

Advances in China continue

Latin America and ROW buoyant and growing

New appointments for USA & Canada

Canada, USA, Russia & Korea are the next exciting new markets


APPP

APPENDIX


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20.00

40.00

60.00

80.00

100.00

120.00

140.00

160.00

FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 16/07/2012

Market Cap

Turnover

Turnover & Market Capitalisation Progression

SOLD INTERPET

SOLD BLACKFAST

SOLD AGIL

SOLD AQUARIUM PRODUCTS

£m


Achieving strategic focus in animal health

2012 family shareholding reduced to 20%

2011 PharmGate Animal Health, Canada established

2010 PharmGate Animal Health, USA established

2009 purchase of ECOPHARMA, Japan

2009 raised £ 6m from share placing

2008 disposal of Aquarium Products

2008 raised £15.5m from share placing

2007 company name changed to ECO Animal Health Group plc

2006 disposal of Agil for £5.5m

2005 disposal of Blackfast Chemicals for £1.3m

2004 family shareholding now under 30%

2004 purchase of 100% of Eco Animal Health for £20m

2004 sale of trading business of ECO Animal Health Southern Africa for £1.5m

2004 disposal of Interpet for £14.5m

2002 family shareholding reduced to 44% from 75%

2002 1 for 2 bonus issue

2002 acquisition of Ringpress Publishing

1999 acquisition of Aquarium Products, USA

1998 acquisition of Blagdon Garden Products

1998 acquisition of Salamander pet books

1997 acquisition of Mikki Pet Products

1996 disposal of Petworld Superstores for £1m

1995 joined AIM at equivalent of 59p per share

1995 acquired Interpet

1993 Eco Group established

1993 disposal of Lawrence Industries for £4.5m

1992 shareholders allowed to exit & Rule 535.2 dealings

commenced

1991 Company re-organised & re-named Lawrence plc

1990 acquired Blackfast Chemicals & Agil

1989 disposal of Absorbent Products for £3.5m

1988 disposal of Mor Products for £0.3m

1987 raised £1.9m as part of Business Expansion Scheme

1987 disposal of Abralap

1985 disposal of Dia –Optic

1985 acquisition of MOR Products

1984 disposal of Corroless International

1982 disposal of Anglosped

1972 Company started by Peter Lawrence & Barry Day

trading minerals, chemicals & specialised machinery

Agil

Others

Interpet

Eco 34% Eco 100%

2002 total sales 2012 total sales

Result


Global Offices

14 regional offices employing 150 people: including 6 PhD’s and 9 veterinarians


Value of Global Animal Health Markets

Global value $22.0 billion*

Growth over 2010 +2%

Healthy stock have the best

feed conversion ratios

Unhealthy animals are less

profitable 47%

32%

21%

Global AH Market By Territory

North America Europe ROW

*Source: Vetnosis 2011

30%

41%

17%

12%

Global AH Market By Species

Ruminant Companion Animals Pigs Poultry


Competition/Markets

Market consolidation continues

Top ten players account for c. 85% of global market

Top 5 companies circa >60% of market

+ 8.3% average growth for leading 19 companies in each of last 2 years

Market splits (sales) by product category: Parasitics 28% Biologicals 25% Medicated feed 11% Pharmaceuticals 20% Anti-infectives 14%


Proprietary patented drugs

Aivlosin® - macrolide antibiotic for treatment of respiratory & enteric diseases in pigs & poultry

Generic drugs

Ecomectin®, Ecoheart, Ecotraz & Ecomintic

Endectocides & other antiparasitics for treatment & prevention of parasites in cattle, sheep, pigs, horses, dogs

Chlortet & Oxytet for treatment of bacterial infections in pigs, poultry & cattle

Existing Drug Portfolio


Represents over 65 % of group sales and growing rapidly

Treats economically important diseases in pigs & poultry

Highly effective medication versus competitors

Effective against both respiratory and enteric diseases

Significant profit improvement for farmer

No known interaction with other products

Registrations now gained in North America-more to follow

Aivlosin – ECO’s Key Patented Brand


Aivlosin - economic benefits vs main competitor

Group Feed & medication cost

€

Profit per pig €

Tylan 100ppm 10.96 8.30

Aivlosin 50ppm 10.97 10.55

Figures based on cost of feed & medication in Ireland & Irish slaughter deadweight prices at the time of compilation

Profit /Pig = value of growth gained less cost of feed & medication

Double blinded controlled study with 210 commercial pigs


Joint Venture in USA

Aivlosin®, our patented macrolide antibiotic, has received first approval for WSG from the FDA

Mycoplasma approvals to follow in c.2 years

Joint Venture operation provides cost effective route to market

opportunity to improve margins

Complementary partner

is a successful, privately owned Chinese company

has existing USA presence selling complementary products including CTC which targets the same customers


JV in USA is Pharmgate Animal Health

Low, shared cost model has been operating for 2 years- sales staff being recruited now

Profits to be retained by each JV partner

Saving distribution margin on anticipated c.$20m sales of Aivlosin at maturity

Own IP is retained by partners

Opportunities

Further collaboration between partners

Additional products can easily be added

Documents

Animal Health Group plc AUDITED RESULTS FOR THE …/media/Files/E/Eco... · · 2012-08-14Animal Health Group plc AUDITED RESULTS FOR THE YEAR ... Group control and re-establishes