Oriola Corporation Financial Statements 2019
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 [email protected]