Orthofix International N.V.

Transcription

1 Orthofix International N.V. NASDAQ:OFIX Brad Mason - President & CEO

2 Safe Harbor Statement Except for historical information contained herein, the statements made in this presentation constitute forward looking statements that involve certain risks and uncertainties. These forward looking statements are based on our beliefs and expectations as of June 9, 2016, and we do not undertake any obligation to revise or update such forward looking statements. Certain factors may cause actual results to differ materially from those contained in the forward looking statements, including those risks detailed from time to time in the Company s reports on file at the Securities and Exchange Commission. 2

3 Use of Non-GAAP Measures Orthofix may use certain non-gaap financial measures in its presentations. Orthofix may use non-gaap financial measures as supplemental measures of performance and believes these measures can provide useful information to investors in evaluating our operations, period over period. However, non- GAAP financial measures have limitations as analytical tools, and should not be considered in isolation or as a substitute for Orthofix s financial results prepared in accordance with GAAP. In addition, investors should note that any non-gaap financial measures Orthofix uses may not be the same non- GAAP financial measures, and may not be calculated in the same manner, as that of other companies. Investors can find reconciliations of our non- GAAP financial measures to the most directly comparable GAAP financial measures in our earnings press releases. 3

4 Who We Are - Leadership Team Ron Matricaria Director, Chairman of the Board Brad Mason President and Chief Executive Officer Doug Rice Chief Financial Officer Mike Finegan Chief Strategy Officer Jeff Schumm Chief Administrative Officer General Counsel Jill Mason Chief Compliance Officer Jim Ryaby, PhD Chief Scientific Officer Brad Niemann President, BioStim Bob Goodwin President, Biologics Davide Bianchi President, Extremity Fixation Ray Fujikawa President, Spine Fixation 22 Years Average Experience in Medical Device 4

5 Who We Are OUR MISSION Improve patients lives by providing superior reconstruction and regenerative orthopedic and spine solutions to physicians worldwide. 5

6 Who We Are Founded in 1980 in Verona Italy by Dr. Giovanni De Bastiani with the development of a novel modular external fixation system to improve fracture healing Today Orthofix is a diverse, global corporation with four strategic business units that design, manufacture and distribute a broad range of orthopedic and spine products 6

7 Who We Are - By The Numbers Net Sales in 2015 of $396 million Global presence in over 70 countries Seven international subsidiaries Sales breakdown: US - 77% OUS - 23% Cash at year end 2015 of $64 million No debt $125 million credit facility in place Executing a $75 million stock repurchase plan 7

8 A Bone Fusion Company BIOSTIM EXTREMITY FIXATION REGENERATION REPAIR BIOLOGICS SPINE FIXATION 8

9 Our Strategic Business Units 2015 SBU NET SALES 24% 19% 42% Strategic Business Unit BioStim Biologics Extremity Fixation 2015 Net Sales ($M) $165 $60 $96 15% Spine Fixation $75 Total Net Sales $396 9

10 BioStim Market & Products * Market Size: $500 M Market Share: 32% Market Position: # Annual Market Growth Rate: 1% - 3% Pulsed Electromagnetic Field technology (PEMF) PMA Class III approved Market leading spine and cervical products Orthofix Cervical-Stim is only FDA approved device for cervical spine Physio-Stim for long-bone healing Products primarily sold in the U.S. 10 * Internal Estimates

11 BioStim Strategy Invest in research: Evidence based Cost effectiveness Basic science New indications for our stimulation technology Expanding our distribution coverage for Spinal-Stim and Cervical-Stim Leverage our core competencies in PEMF Spinal-Stim Cervical-Stim Physio-Stim 11

12 Biologics Market & Products * Market Size: $1.74 B Market Share: 5% Market Position: #5 Annual Market Growth Rate: 3% - 5% Human cellular and tissue-based business Long-term relationship with Musculoskeletal Transplant Foundation (MTF) Trinity stem cell tissues are market leader products Launched new generation tissue form Trinity ELITE in June 2013 Products primarily sold in the U.S. 12 *U.S Bone Replacement Market, SmartTRAK

13 Biologics Strategy Continue to leverage the market acceptance of Trinity ELITE Expand our distribution coverage beyond our spine and extremity fixation sales channels into other orthopedic markets Increase our distributor partners in our existing markets Accelerate new tissue development projects with MTF Trinity ELITE Trinity Evolution 13

14 Extremity Fixation Market & Products * Market Size: $800 M Market Share: 10% Market Position: #5 (External Fixation) Annual Market Growth Rate: 2% - 4% Fracture repair, deformity correction and bone reconstruction Primarily external fixation devices, with complimentary internal fixation devices Ring fixation, pin-to-bar, plates, screws, nails Best-in-class products 80% of our revenue from outside of the U.S. 14 * Internal Estimates

15 Extremity Fixation Strategy Continue driving adoption of TrueLok Hex and Galaxy product lines Increase penetration into existing world markets and expand into additional countries with high potential Focus the business on temporary fixation, deformity correction, foot & ankle and pediatric markets Develop and acquire premium products targeted at these markets Contours VPS 3 TrueLok Hex Guided Growth 15

16 Spine Fixation Market & Products * Market Size: $9.0 B Market Share: 1% Market Position: #9 Annual Market Growth Rate: 1% - 3% Implants for spine surgeries Degenerative, MIS and deformity Cervical, interbody and thoracolumbar Anterior, posterior and lateral approaches 85% of revenue from the U.S. 16 * Internal Estimates

17 Spine Fixation Strategy Continue to expand U.S. sales force coverage Add stocking distributors in targeted international markets Achieve operating income profitability in the second half of 2016 through improved gross margins and reduced SG&A expenses Continue to increase new product introduction pace both internally and through product licensing and acquisition opportunities LONESTAR CSA CONSTRUX Mini PTC Centurion POCT 17

18 What To Expect From Orthofix 18

19 Drive Revenue Faster Than Market Growth Rates $410M $400M 396 $390M 389 $380M 375 $370M $360M $350M Guidance Constant Currency Net Sales * 2015 FX rates 19

20 Near Term Focus Execute strategies in each SBU to grow top line faster than markets Margin expansion through improved operating leverage and SG&A expense reductions Continue to invest in clinical research in our regenerative businesses to identify new indications and support reimbursement 20

21 Longer Term Objectives Continue to: grow faster than our markets protect our gross margins optimize our cost structure Adjusted EBITDA margins greater than 20% ROIC above 10% 21

22 2016 Capital Management Strategy Capital deployment focus on ROIC Continue to increase cash generation through improved asset management Invest in clinical research in our core technology areas Finalize our infrastructure improvements to achieve better efficiencies and controls Continue to execute our $75 million stock repurchase plan Acquire or license products and technologies that support our existing businesses 22

23 Investment Highlights Diversified business focused on bone fusion Global distribution footprint Investing in core technologies Grow net sales faster than markets Operating margin expansion opportunity Accelerating Free Cash Flow Strong balance sheet 23

24 Thank You OFIX Orthofix.com Investor Relations Mark Quick COPYRIGHT ORTHOFIX INC v1