Interim Results Presentation For the six months ended 31 December - PowerPoint PPT Presentation

Interim Results Presentation For the six months ended 31 December 2016

Performance overview

Performance overview Group revenue Revenue b by c custo tomer g geography Enti tity ty-wide a analysis R'millio illion H1 2 2017 H1 2 2016 % c change Commercial - pharmaceutical 15 069 12 622 19% International 7 052 5 784 22% Asia Pacific 4 568 3 101 47% Sub-Saharan Africa 3 449 3 737 -8% Commercial - nutritionals 1 632 1 785 -9% Manufacturing 3 121 3 105 1% Total 19 8 822 17 5 512 13%  Commercial pharmaceuticals +19% ◦ Driven by AZ anaesthesia acquisition  Commercial nutritionals impacted by Chinese regulations and currency  Manufacturing revenue flat ◦ Reduced supply to GSK, mainly thrombosis brands in China − ZAR 160 million revenue impact 3

Performance overview International - Pharmaceutical Revenue b by c custo tomer g geography R'millio illion H1 2 2017 H1 2 2016 % c change Europe CIS 4 484 4 114 9% - Base business 3 699 4 114 -10% - Anaesthetics 785 - - Latin America 1 238 983 26% - Base business 1 023 983 4% - Anaesthetics 215 - - MENA 523 413 27% - Base business 429 413 4% - Anaesthetics 94 - - North America 807 274 195% - Base business 705 274 157% - Anaesthetics - Canada 102 - - Total 7 0 052 5 7 784 22% 4

Performance overview International - Pharmaceutical  Excluding anaesthetics, base business grew 1%  Europe CIS ◦ Primary decline caused by change in distribution model and supply challenges − Impacts this period only ◦ Exchange rate effect of EUR 4 million − Brexit effect over EUR 6 million − Some offset from Ruble ◦ Pricing pressures on thrombosis − Annualised impact of EUR 14 million − Synergy offsets  Latam, MENA and North America ◦ Latam and MENA performing in local currency (-14% MXN vs ZAR) ◦ Change of HPC distribution in the USA − Moved to supply and distribution agreement with major pharma company − USD 30 million of HPC sales − Further sales in CY 2017 unlikely ◦ Canada and MENA driven by anaesthetics 5

Performance overview International - Pharmaceutical  H2 expectations ◦ Europe CIS base business above both H2 2016 and H1 2017 in EUR − Pricing pressures more than offset by Normalised distribution and supply • Synergy realisation • Improved thrombosis performance • ◦ Latam and MENA base growth to further improve on H1 2017 performance ◦ One/two ANDA launches in the USA ◦ Increased contribution from anaesthetics portfolio − Addition of GSK and AZ in for full 6 months 6

Performance overview Asia Pacific Revenue b by c custo tomer g geography Austr tralia & & N New Z Zealand R'millio illion H1 2017 H1 2016 % c change Conti tinuing b business 3 0 045 2 7 774 10% Base pharmaceutical business 2 294 2 220 3% Anaesthetics 323 - - Nutritionals 428 554 -23% Divestments & discontinuing operations 120 353 - Tota tal r revenue 3 1 165 3 1 127 1% Asi sia R'millio illion H1 2017 H1 2016 % c change Base business 854 730 17% Anaesthetics 1 229 - - Tota tal r revenue 2 0 083 7 730 185% Total A l Asia ia P Pacif ific ic r revenue 5 2 248 3 8 857 36% 7

Performance overview Asia Pacific  Region most positively impacted by AZ anaesthesia acquisition  Asia now 40% of regional sales ◦ Anticipated to exceed 50% in short term  Australian base pharma business performing ◦ Challenging regulated market ◦ Benefitting from focus  Decrease in divested and discontinuing operations ◦ Prior period divestment  Nutritionals impacted by change in Chinese regulations  Asia base revenue sustains double-digit growth ◦ Aspen’s quality/affordable model - great fit 8

Performance overview Asia Pacific - Nutritionals  Entire local market impacted ◦ Loss of informal export sales to China ◦ Change in Chinese regulatory environment  Sales settling at 2014 levels ◦ Aspen less affected than most ◦ Stronger domestic underpin ◦ In-market sales stabilised over last 6 months S-26 Gr 26 Grocery S Sale les  Chinese regulatory challenges ◦ Remain opaque Stabilis bilisin ing ◦ Hard to predict  Aspen strategy to enter China to be accelerated ◦ Direct approach favoured ◦ NZNM approved for China 13 wks to 13 wks to 13 wks to 13 wks to 3/04/2016 3/07/2016 2/10/2016 1/01/2017 9

Performance overview Sub-Saharan Africa Revenue b by c custo tomer g geography R'millio illion H1 2 2017 H1 2 2016 % c change Pharma revenue 3 449 3 737 -8% South Africa 3 022 3 275 -8% Other SSA 427 462 -8% Nutritional revenue 490 448 9% South Africa 447 417 7% Other SSA 43 31 38% Total c commer ercial r rev even enue 3 9 939 4 1 185 -6 -6% Manufacturing - API and FDF 706 528 34% Total 4 4 6 645 4 7 713 -1 -1%  South African and Sub-Saharan Africa regions have been consolidated ◦ GSK termination – other SSA no longer material enough for stand alone 10

Performance overview Sub-Saharan Africa - South Africa Revenue b by c custo tomer g geography R'millio illion H1 2 2017 H1 2 2016 % c change Pharma revenue 3 022 3 274 -8% Private sector 2 330 2 514 -7% Public sector 692 761 -9% ARV tender 383 465 -18% Other tenders 309 296 4% Nutritional revenue 447 417 7% Total c commer ercial r rev even enue 3 4 469 3 6 692 -6% Manufacturing - API and FDF 706 528 34% Total 4 4 1 175 4 4 2 220 -1 -1%  In H2 2016 we said ◦ Supply chain prioritisation mismanaged ◦ Open ended tender commitment ◦ Impact to continue into H1 2017 ◦  Dem emonstrated ed in year ear t to date p e performance H2 2017 tender volumes defined and supply ◦ stabilised H1 H1 2017 2017 commercia ial l sales 6% 6% v vs p prior y year  This is still our commitment in spite of strike in H1 ◦ YT YTD February 2017 2017 sale les 7% 7% v vs p prior y year 11

Performance overview Sub-Saharan Africa – Other SSA Ot Other S SSA regio gional l contribution ( (ex-GSK SK) Sale les: ZAR 424 424 millio llion 10% 18% 72% West Africa Southern Africa East Africa Revenue b by c custo tomer g geography R'millio illion H1 2 2017 H1 2 2016 % c change Collaboration net revenue* 46 99 -53% Retained pharma 424 394 7% Total 4 470 4 493 -5% -5 *H1 2017 gross revenue of ZAR 1.4 billion (H1 2016 : ZAR 1.6 billion) 12

Therapeutic overview

Therapeutic overview Nutritionals  Challenging half ◦ Australia – impacted by China ◦ Latam − Venezuela implosion impacted production − Mexican currency devaluation ◦ SA – performance sustained ◦ USA − Legislation introduced − Need for clinical trials  Expectations for H2 ◦ Latam to turn around − Stocks normalised − Infacare tender uptake in Mexico ◦ Asia Pacific − January/February starting to stabilise vs prior year − Chinese entry under consideration 14

Therapeutic overview Anaesthetics portfolio  Aspen will be the largest global player in anaesthesia ex-USA  AZ brands included from 1 st September 2016  GSK brands included from 1 st March 2017  Good fit - high percentage of sales in emerging markets ◦ Performance in Asia Pacific central to success Anaes aesthes esia a sale les s split lit by r regio gion  Markets being transitioned from AZ to Aspen ZAR 2. 2.8 b 8 billio lion ◦ Pharmaceutical responsibility, representation and 4% 4% 4% 4% distribution/invoicing moved 8% 8%  Markets that have been transitioned include ◦ Australia, France, Brazil, Russia and Germany 55% 55% ◦ 90% of the markets (by value) to be transferred by 29% 29% February 2018  Sales of AZ brands for 4 months ◦ Broadly in line with prior year Asia Pacific Europe Latam Canada ROW* ◦ Limited time period; assessing performance *ROW – refers to MENA and SSA ◦ Aspen to add strategic impetus and focus 15

Therapeutic overview Anaesthetics portfolio - Australia Austral alia A Anaes aesthetics Portfolio lio (MAT v valu alue) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2016  Products unpromoted – sales stable  Aspen has a presence in this sector ◦ Recruited additional specialist heads ◦ Historically, promotionally sensitive ◦ Focus on unique product offering 16

Therapeutic overview Anaesthetics portfolio - China  Aspen team go live on 1 April 2017  Fully functional back office ◦ Shanghai, Beijing and Guangzhou  Almost all employees transferring ◦ Confidence in Aspen focus ◦ Human capital loss mitigated  China is a promotionally sensitive market ◦ AZ sales in 2015 had declined by 16% China A Anaes aesthetics P Portfolio ◦ Returned to growth in 2016 ◦ Momentum has turned ◦ Chinese team motivated Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2016 MAT volume 17

Therapeutic overview Anaesthetics portfolio  This is a difficult therapeutic area to enter ◦ Complex and varied delivery forms − Vials, ampoules, suppositories, prefilled syringes, jellies, creams, ointments, liquids, sprays, patches, towels and more ◦ Trusted brands and related devices  GSK brands complimentary ◦ Credibility and critical mass  Opportunity to acquire global brands in related areas ◦ Global pain product under discussion  Current performance positive ◦ Cautiously optimistic on China ◦ Strategy developed by region and by brand 18