Oriola CorporationFinancial Statements 2019

7.2.2020 2

Q4 2019 highlights

• Strong invoicing and net sales growth continued

• Online competition and high costs in Swedish operations affected adjusted EBIT

• Ramp-up of distribution centre in Sweden proceeding slower than planned

• Logistics Finland executing very well

• Inventory valuation error corrected in Consumer BA

• Progress in strategic programmes

• Strong cash flow. Dividend proposal EUR 0.09 per share

3

Q1

7.2.2020

Invoicing Net sales Adjusted EBIT *EUR millionEUR million EUR million

Key figurescontinuing operations

Q4/2019 adjusted EBIT at comparableEUR/SEK rate EUR 1.9 millionQ3Q2 Q4

1 578 1 589 1 528 1 5521 721

398 388 367 388 397

406 407 388 399 449

366 383 378 370429

0

200

400

600

800

1 000

1 200

1 400

1 600

1 800

2 000

2015 2016 2017 2018 2019

408 411 395 395447

3 211 3 364 3 336 3 5183 733

780 820 798 848 894

812 874 844 897 943

776 812 823 844 917

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

2015 2016 2017 2018 2019

844 859 872 929979

* The figures in 2016–2018 have been restated due to an error related to previous periods

59.8 58.7

39.0 34.4

20.5

12.8 13.65.8 3.7

14.8 14.5 13.06.6 5.6

9.717.0 16.5

11.0

17.19.1

0

10

20

30

40

50

60

70

80

90

2015 2016 2017 2018 2019

15.2 14.1

5.3 5.0

2.1

Adjusted EBIT* Adjusted EBIT development*

Adjusted EBIT

EUR millionEUR million

47.2.2020

*Q4/2019 adjusted EBIT at comparable EUR/SEK rate EUR 1.9 million

5.0

2.1

-1.7 0.1

-0.5-0.8

Q4 2018 Consumer Pharma Retail Group items Q4 2019

* The figures in 2018 and previous quarters of 2019 have been restated due to an error related to previous periods

5.03.7

5.6

9.1

2.10

1

2

3

4

5

6

7

8

9

10

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

Operating environment

17.7.2019

Consumer markets in 2019

Market shares

Oriola/Kronans Apotek 17 (17*)%Apoteket 32 (32)%

Apotek Hjärtat & CURA 30 (31)%

Others 3 (3)%

Lloyds Apoteket 4 (4)%

Apoteksgruppen 9 (9)%

Apotea 6 (4)%

388

397387

396

48

79

326

187

Source: Apoteksförening

6

397

327

188

79

4.5 BEUR

Pharmacy market

4.5 BEUR

Rx 74 (74*)%

OTC 9 (9)%

TG 17 (16)%

Online

Online share of Swedish Pharmacy market

7.2.2020 * Q4/2018

0%

2%

4%

6%

8%

10%

12%

Finland Wholesale Sweden Wholesale

Wholesale markets in 2019

4.4 BEUR2.7 BEUR

Oriola 44 (40) % Others 56 (60) %

7

Oriola 46 (43) % Others 54 (57) %

Source: LTK and Oriola estimate Source: IQVIA and Oriola estimate

7.2.2020

Pharmaceutical market growth: Finland 5.2% and Sweden 7.6%

Retail markets in 2019

8

Market share dose dispensing

32 MEUR

Source: Oriola estimate

TG/OTC products supply for pharmacies in Sweden

245 MEUR

Staffing services in Finland

in 155 pharmacies in Q4

of a total of 815 pharmacies

26% from the total market of

EUR 1.2 billion

Oriola 43 (25) % Others 57 (75) %

Oriola 40 (40) % Others 60 (60) %

Finland

Sweden

7.2.2020

Total 225,000 patients

Total 55,000 patients

Strategic initiatives

Strategic programmes20by20 Excellence• EUR 20 million annualised savings compared to the

cost level in 2018 by the end of 2020• Savings realised in 2019 mainly in logistics and IT

costs in FinlandCustomer Experience• To make the customers’ voice heard and to provide

the best customer experience• Customer satisfaction has progressed positively,

especially in Finland

17.7.2019 10

Enköping DC in Sweden

• Fully automated DC for growing pharmaceuticals and traded goods volumes and efficiency in Sweden

• Ramp-up started in Q1/2019 and has progressed slower than planned

• High cost level continued during Q4

• Adding gradually RX products to new automation

17.7.2019 11

Sustainability strategy and long term goals

25.10.2019 12

UN’s Sustainable Development Goals

Long term goals

Business Area reviews Q4 2019

Three customer-centric business areas

7.2.2020 14

Consumer business areaRetail services and products for consumer health and wellbeing in Sweden in Kronans Apotek and in cooperation with Doktor.se.

Pharma business area Tailored logistics, expert and advisory services for pharmaceutical companies, and a wide range of pharmaceuticalproducts for pharmacies, hospitalpharmacies and veterinarians.

Retail business areaA wide range of health and wellbeing products for pharmacies, veterinarians, private and public healthcare operators and retailers, as well as services for pharmacies, including dose services and staffing.

Operations group functionServing all business areas, focus on logistics operations, direct and indirect sourcing, dose manufacturing.

44% ofGroup net sales

40% ofGroup net sales

16% ofGroup net sales

External Net sales, 2019.

• Net sales increased by 3.2% to 197.0 M€ in constant currency

• Kronans Apotek’s online sales continued to drive growth (+20% vs the market +32%)

• Share of OTC and traded goods of net sales 24.4% (25.1%). Share of low margin RX is increasing

• Tight price competition, especially from online, spending in IT development and increased overall cost level burdened profitability

• Error related to inventory valuation corrected

15

Consumer Q4 2019

Adjusted EBIT*EUR million

7.2.2020

2.8 2.8 2.9

4.9

1.10

1

2

3

4

5

6

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

* The figures in 2018 and previous quarters of 2019 have been restated due to an error related to previous periods

• Net Sales increased by 24.0% to 242.2 M€, and in constant currency by 26.4%

• Good sales development was driven by the pharmaceutical market growth and changes in distribution agreements for pharmaceuticals

• Continuous operational efficiency improvements and savings impacted the results positively in Finland

• Slower than planned ramp-up of distribution centre kept the cost level high in Sweden

16

Pharma Q4 2019

Adjusted EBITEUR million

7.2.2020

4.13.5

4.75.2

4.2

0

1

2

3

4

5

6

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

• Net sales increased by 6.5% to 114.1 M€, and increased by 9.5% in constant currency

• Growth driven by increased number of dose dispensing patients (+85%) in Sweden

• Weak sales margin in Finland• High operations costs in Sweden

impacted profitability

17

Retail Q4 2019

Adjusted EBITEUR million

7.2.2020

0.0

-0.6

0.2 0.3

-0.8

- 2

0

2

2018 2019 2019 2019 2019Q4 Q1 Q2 Q3 Q4

Financial review Q4 2019

Invoicing

Invoicing and net sales

EUR million

197.2.2020

Net salesEUR million

929894

942 917979

0

200

400

600

800

1 000

1 200

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

395 397448 429 447

0

50

100

150

200

250

300

350

400

450

500

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

Q4/2019 Net Sales at comparable EUR/SEK rate EUR 458 millionQ4/2019 Invoicing at comparable EUR/SEK rate EUR 1,000 million

Adjusted EBIT* Adjusted EBIT development*

Adjusted EBIT

EUR millionEUR million

207.2.2020 Q4/2019 adjusted EBIT at comparable EUR/SEK rate EUR 1.9 million

5.03.7

5.6

9.1

2.1

0

1

2

3

4

5

6

7

8

9

10

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

5.0

2.1

-1.7 0.1

-0.5-0.8

Q4 2018 Consumer Pharma Retail Group items Q4 2019

* The figures in 2018 and previous quarters of 2019 have been restated due to an error related to previous periods

Profit for the period* Earnings per share*

Profit for the period and earnings per share

EUREUR million

217.2.2020

-8.6

1.74.5

2.0 -0.2

-10

-8

-6

-4

-2

0

2

4

6

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

-0.05

0.010.02

0.01 -0.00

-0,06

-0,04

-0,02

0,00

0,02

0,04

0,06

0,08

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

* The figures in 2018 and previous quarters of 2019 have been restated due to an error related to previous periods

22

Cash flow

Quarterly net cash flow from operating activities EUR million

Q4 YTD 2019 change in cashEUR million

7.2.2020

183

48

-25

70

13

27

-40

-20

0

20

40

60

80

Q2/2018 Q3/2018 Q4/2018 Q1/2019 Q2/2019 Q3/2019 Q4/2019

65.8 70.8

84.4

-21.8

-57.6

Cash Q4 2018 Operatingactivities

Investingactivities

Financingactivities

Cash Q4 2019

23

Net Interest-Bearing Debt

Net interest-bearing debt EUR million 31 Dec2019

31 Dec2018

Bank loans (syndicated Bank & term)

57.8 59.0

Commercial papers 35.0 57.0

Advance payment from pharmacies

13.2 12.4

Leasing liabilities¹ 84.3 1.0

Cash and cash equivalents 70.8 65.8

Net interest-bearing debt¹ 119.6 63.6

Sold trade receivables 166.5 140.5

Gearing %² 76.1 35.8

EUR million

7.2.2020

¹ Figure in 2019 includes EUR 83.9 million leasing liabilities recognised dueto application of IFRS 16² Excluding the impact of IFRS 16 gearing would have been 21.9%.

84100 105

64

199

150133

120

-30

20

70

120

170

220

Q1/2018 Q2/2018 Q3/2018 Q4/2018 Q1/2019 Q2/2019 Q3/2019 Q4/2019

Q4 2019 Key take-aways

7.2.2020 24

Strong invoicing and net sales

growth continued

High logistics costs in Sweden

Logistics performing very well in Finland

Progress in strategic

programmes

Consumer result burdened by online

competition and overall cost level

increase

In 2020 focus on execution and savings

17.7.2019 25

20by20 ExcellenceEfficiency – Savings – Profitability

Customer ExperiencePersonal – Professional – Partnership

OneOriola journeyEngagement – Integration –Synergies

Outlook for 2020

7.2.2020 26

Adjusted EBIT on a constant currency basis

is estimated to increase from the 2019 level

Oriola’s business outlook for 2020 is based on external market forecasts,

agreements with pharmaceutical companies and pharmacies,

and management assessments.

Thank you!

Our next events:

17/3/2020Oriola Corporation's Annual General Meeting, Helsinki24/4/2020Interim Report 1-3/202017/7/2020Half year financial report 1-6/202023/10/2020Interim Report 1-9/2020

IR contact: Katja Graff, Treasury & IR Manager, +358 10 429 013katja.graff@oriola.com