VITROLIFE AB (PUBL) Pareto Securities Health Care Conference

2018-09-06

1

10–15 % OF ALL COUPLES IN FERTILE AGE SUFFER FROM FERTILITY PROBLEMS

2

LEADING COMPANY IN MEDICAL DEVICES FOR ASSISTED REPRODUCTION

3 * Rolling 12 months

A Swedish company

Founded in 1994

Approx 370 employees

Sales 1 064 MSEK*

97% on export

Listed on NASDAQ Stockholm Mid Cap

AN INCREASING TREND OF DELAYING FIRST BIRTH

4

Source: UNECE Statistical Database. Data collected from Eurostat and UNICEF TransMONEE official sources

22

24

26

28

30

32

1980 1990 2000 2010 2014

Age

Spain

Sweden United Kingdom

Poland

United States

AGE IS A CRITICAL FACTOR FOR SUCCESS

5 2015 Assisted Reproductive Technology, National Center for Chronic Disease Prevention and Health Promotion, Divison of Reproductive Health

Day 3 and Day 5 embryo transfers that resulted in live births by age

Percentages of ART cycles that resulted in miscarriage by age

SUCCESS RATE ”STEP BY STEP”

6 2015 Assisted Reproductive Technology, National Center for Chronic Disease Prevention and Health Promotion, Divison of Reproductive Health

Outcomes of ART Cycles Using Fresh Nondonor Eggs or Embryos

Percentages of ART Cycles Using Fresh Nondonor Eggs or Embryos That Resulted in Pregnancies, Live Births, and Single-Infant Live Births, by Age of Woman*

Hormone stimulation to increase the number of retrievable eggs

HORMONE TREATMENT

THE IVF-PROCESS – VITROLIFE PRODUCTS

7

COST STRUCTURE FOR AN IVF CLINIC

8

Comments

Salaries are the major cost

Sales & marketing is in other operating costs

Clinic chains have higher financial costs than non clinic chains

17%

10%

45%

26%

2%

Salaries 45%

Depreciation 1-3%

Purchase 8-12%

EBITA 25-30%

Other operating costs 15-25% (currently reconstruction cost or high financial cost to owner structure)

Ensure staff are well trained

Secure access to the latest know-how and technologies

Maximise clinic efficiency and reliability

Improve the financial results

9

WITH FOCUS ON SUPPORTING CLINICS IN BECOMING SUCCESSFUL

LARGE REGIONAL DIFFERENCES ON NUMBER OF IVF CHILDREN BORN

10

ART INFANTS (EXCL. IUI) PER NATIONAL BIRTH %

Source: Data from 2013-2016

Increased regulatory demands (higher barriers to enter)

Cooper has strengthened its position by acquisitions

Emergence of local players with domestic production in China and Japan

Kitazato emerging competitor in new areas

Time-lapse is increasing Pre-implantation genetic testing is

increasing Cryo-preservation is increasing Mild stimulation is increasing

Patients are more informed and involved as decision-makers

Growing middle class Parents’ mean age is increasing Social freezing is growing

Consolidation of IVF clinics Private equity owned clinic chains Increased demand for easy-to-use

products and workflow efficiency Mid-single digit growth in oocyte pick-

up cycles Higher revenue growth due to up-

selling

MARKET TRENDS

11

PATIENTS

IVF CLINICS TREATMENT

COMPETITION

STRATEGIC OPPORTUNITIES

Opportunities in all markets – sell more of existing portfolio – time-lapse expansion – product line expansion

Technology changes – selection / decision support

Medtech diagnostics and pharma integration / cooperation

12

SUMMARY Q2

Sales of 283 MSEK (285) equals -1% in SEK Sales decreased by 5% in local currencies EBITDA of 116 MSEK (41% margin) Market approval for EmbryoScope+ in the US Share split 5:1 Collaboration agreement with GE Healthcare

13

SALES AND GROWTH PER BUSINESS UNIT

14

+9%

-10%

-9% TIME-LAPSE

DISPOSABLE DEVICES

MEDIA

ART EQUIPMENT

Quarterly growth Local currencies

SEK millions, rolling 12m

469 482 500 519 536 543 545 543 562

134 136 139 142 148 150 148 151 149 146 148 160 178 209 233 254 271 267 3

20 39 56

78 80 78 80 65

0

200

400

600

800

1000

1200

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2016 2017

-61%

2018

SALES AND GROWTH PER MARKET REGION

15

Total -5%

Q2 GROWTH RATE COMPARED TO LAST YEAR IN LOCAL CURRENCIES

SHARE OF VITROLIFE’S SALES ROLLING 12-MONTHS 14%

+3%

25% 45%

* Whereof organic growth -1 percent

16%

+7% -26% +6%

KEY FINANCIALS GROUP Q2

2018 Q2

2017 Q2

2018 Q1-Q2

2017 Q1-Q2

2017 FY

Sales, MSEK 283 285 547 529 1 046

Gross Margin % 66% 65% 66% 65% 65%

Adj. Gross Margin %* 70% 69% 69% 69% 69%

EBITDA, MSEK 116 112 222 207 408

EBITDA Margin % 41% 39% 41% 39% 39%

Earnings per share, SEK** 0.73 0.66 1.39 1.20 2.43

Net Debt / EBITDA rolling 12m -1.0 -0.5 -1.0 -0.5 -1.0

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• Fluctuations in exchange rates positively impacted EBITDA by SEK 8 million. • Dividend paid of SEK 81 million (SEK 3.70 per share before share split)

* Gross margin excluding amortisation of acquisition-related intangible assets ** Recalculated with regard to the 5:1 share split carried out in May 2018.

THE SHARE

17

• Listed on NASDAQ Stockholm Mid Cap

• Market value: ~13 billion SEK

• Share split on May 17 (5:1)

1. William Demant Invest A/S 22.2% 2. Bure Equity AB 20.8% 3. SSB CLIENT OMNIBUS AC OM07 7.1% 4. Lannebo Småbolag 2.9% 5. Eccenovo AB 2.1% 6. CBNY-NORGES BANK 1.9%

SEK / SHARE

Stockholm

LARGEST OWNERS 31 July 2018

OUTLOOK

18

Long-term market growth 5-10% in monetary terms

Expansion of sales

Broadening the product offering

Contact: Thomas Axelsson, CEO, taxelsson@vitrolife.com, +46 31 721 80 01 Mikael Engblom, CFO, mengblom@vitrolife.com, +46 31 721 80 14

DISCLAIMER This presentation contains estimates and forward-looking statements, which reflect the Management’s current views with respect to the market, certain future events and financial performance. Although the statements are based upon estimates the Management believes to be reasonable, there is no assurance that these statements are correct or will be achieved. The most important strategic and operative risks regarding Vitrolife’s business and field are described in the Management report, in the Annual Report. These are primarily constituted by macro-economic risks, operational risks and financial risks.