Strategic Direction 2011
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Indicative 2015 Results (Unaudited) February 2016 Table of Contents Macro Overview 33 Business Overview 36 Indicative 2015 Results 143 2016 Outlook 203 Excellence in Execution 2 Section 1 Macro Overview Macro Overview Macro Headwind in 2015 1. Weaker Economic Growth, with Low Inflation 3. Government Infrastructure Improvements Underway 2014 5,02% 2015 4,79% 5,14% 5,03% 5,01% 5,04% 4,92% 4,72% 4,67% 4,73% • Infrastructure projects are underway and expected to support growth ahead 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 4. ASEAN Economic Community Economic growth decreased from 5.02% in 2014 to 4.79% in 2015, mostly due to weak household • International expansion opportunity consumption and lower export. • Non-tariff barriers in pharma industry Inflation declined to 3.35% y-o-y in line with lower are still present volatile food and administered price. 5. Regulatory Update 2. Further Rupiah Depreciation in 2015 Government Stimulus Package 10 13,795 - Allows 100% foreign ownership in 12,440 pharmaceuticals raw materials -10.9% - Pharmaceuticals finished goods sector remains capped at 85% Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 4 '14 '15 '15 '15 '15 '15 '15 '15 '15 '15 '15 '15 '15 Excellence in Execution 4 Healthcare Industry National Health Insurance Progress JKN Coverage JKN Highlights & Outlook 2019 2015 • 158 million people covered • 95% of SOEs have registered in BPJS 2014 • BPJS reported a deficit of Rp 5.85 trillion 250 mn 158 mn Source : BPJS, BPJS Online 133 mn Increased Healthcare Allocation in 2016 Government Budget CAGR 20.6% Source : Ministry of Finance Excellence in Execution 5 Section 2 Business Overview Our Business Strengthening Our Footprints as a Health Care Company What Business We are an Innovative Health Care Business providing Health Care Products & Its Are We In Related Services Mission To improve health for a better life To be the best Indonesian Global Health Care company driven by innovation, Vision strong brands and excellent management 1. Sustainable Growth Strategy 2. Innovation, Quality, and Productivity 3. World Class Competence & Organization Values We believe in : Trust, Mindfulness, Innovation, Strive to be the best, Interconnectedness Excellence in Execution 7 Our Strategic Focus 2016 Corporate Initiatives Business Leadership Structure & Development Portfolio Collaborative Innovation *ERM : Enterprise Risk Management SCM : Supply Chain Management Excellence in Execution 8 Key Achievements & Activities 2016 Corporate Initiatives Leadership Development Kalbe Middle Finance Officer Kalbe Training Programs Management Program Development Program Learning Center Business Structure & Portfolio Visit of the Minister of Research & Technology and Higher Education to SCI Excellence in Execution 9 Key Achievements & Activities 2016 Corporate Initiatives Business Structure & Portfolio Customer Engagement Integrated Service to Consumers Events 2015 Kalbe Customer Care Kalbe Home Delivery Kalbe e-Store KALCare Experiential Store Kalbe Family Rewards Card Dunia Generasi Platinum Fitbar Fun Activation Morinaga Mall to Mall (FIFA) Mobile Applications Utilization Mommychi Diabetes Solution KalbeMed AntioksiDANCE Prenagen Pregnancy Mom & Child Center Mobile Mobile Application Entrasol Education Journey Mobile Application Application Excellence in Execution 10 Key Achievements & Activities 2016 Corporate Initiatives Fitbar Massive Diabetasol in Nutritionist and Dietitians Business Structure & Portfolio Sampling Activities Associations of the Philippines International Expansion Hydro Coco Product Display in UAE Woods Horizontal Banner in KL Sentral UAE Philippines Malaysia Nigeria Myanmar Vietnam Kalbe Morinaga Pharma Actvities in Oncology Department Mixagrip in Pharmacy Pharmacy Branding Milna Massive Sampling Selling Gathering in Medical Channel Excellence in Execution 11 Key Achievements & Activities 2016 Corporate Initiatives Collaborative Innovation Visit of the Minister of Industry to Biosimilar Factory Construction JV Kalbe Blackmores JV Kalbe Genexine Excellence in Execution 12 Key Achievements & Activities 2016 Corporate Initiatives Enterprise Risk Management (ERM) Quality Assurance & Financial Compliance Supply Chain Management (SCM) Powdered milk New liquid milk factory Distribution Infrastructure capacity expansion Excellence in Execution 13 Section 3 Indicative 2015 Results Consolidated Operational Performance Overall Weaker Results in Challenging Time Net Sales - Unaudited (in Rp Bn) 3.0% 31 Dec 2014 31 Dec 2015 17.369 17.888 (Audited) (Unaudited) -2.2% -0.8% 11.6% 4.9% 5.535 5.415 4.329 4.293 4.581 5.114 2.924 3.066 Prescription Consumer Health Nutritionals Distribution & Consolidation Pharmaceuticals Logistics Excellence in Execution 15 Consolidated Operational Performance Pressure on Operating Margin Gross Profit - Unaudited Operating Expenses to Net Sales Ratios - (in Rp bn) Unaudited 1.2% 48.8% 47.9% 32.9% 33.2% 8.476 8.574 0,8% 0,9% 5,2% 5,3% Selling & Marketing 31 Dec 2014 31 Dec 2015 General & (Audited) (Unaudited) 26,9% 26,9% Administrative Operating Profit - Unaudited Research & (in Rp bn) Development -4.3% 15,9% 31 Dec 2014 31 Dec 2015 14,8% (Audited) (Unaudited) 2,761 2,641 2,641 • Marketing efforts to drive brand awareness • Research & development activities to support product development 31 Dec 2014 31 Dec 2015 (Audited) (Unaudited) Excellence in Execution 16 Consolidated Operational Performance Negative Impact on Bottom Line Income Before Tax - Unaudited Net Income - Unaudited (in Rp bn) (in Rp bn) -2.0% -4.3% 15.9% 15.1% 11.9% 11.0% 2.764 2.709 2.065 1.975 31 Dec 2014 31 Dec 2015 31 Dec 2014 31 Dec 2015 (Audited) (Unaudited) (Audited) (Unaudited) • Income before tax margin decreased from 15.9% in FY • Net income margin decreased from 11.9% in FY 2014 2014 to 15.1% in FY 2015, mostly due lower gross profit. to 11.0% in FY 2015, in line with lower income before tax margin. Excellence in Execution 17 Working Capital Management Improving Inventory Days 158 No. of days 129 131 128 120 120 142 108 114 132 Days of Account Receivables 122 125 116 110 115 107 Days of Inventories 50 43 45 44 48 48 49 48 Days of Account Payables 57 50 46 44 38 35 41 27 Net Operating Cycle 2008 2009 2010 2011 2012 2013 2014 2015 (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Unaudited) Net Operating Cycle has been End-to-end supply chain reduced by 38 days from 158 management will be implemented days to 120 days to overcome fluctuation in inventory Excellence in Execution 18 Working Capital Management Strong Balance Sheets Total Debt and Gearing Ratio Cash & Net Cash Balance 7,2% 600 15,0% 2.704 2.291 2.309 500 2.151 1.895 1.895 7,9% 3,8% 1.902 1.877 1.860 400 3,2% 10,0% 1.562 1.655 1.598 300 1.222 1.311 2,3% 2,9% 584 200 0,5% 5,0% 100 340 141 205 296 394 0 25 0,0% 2009 2010 2011 2012 2013 2014 2015 (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Unaudited) 2009 2010 2011 2012 2013 2014 2015 (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Unaudited) Total Debt in Rp Billion Gearing Ratio Cash and Cash Equivalent in Rp Billion Net Cash in Rp Billion Dividend Payment Capital Expenditure * in Rp Billion Cash Dividend* (Rp/share) Dividend Payout Ratio (%) 994 945 783 852 51% 43% 20,0 51% 60% 42% 80% 15,0 60% 470 469 10,0 40% 5,0 14,0 19,0 19,0 17,0 19,0 20% 0,0 0% 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 2015 (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Unaudited) *For Fiscal Year *Cash dividend are adjusted for stock split impact Excellence in Execution 19 Section 4 2016 Outlook Outlook 2016 2016 Earnings Guidance 1. Year-on-year Sales Growth 8% - 10% 2. Operating Profit Margin 14% - 15% 3. Earnings per Share Growth 8% - 10% 4. Dividend Payout Ratio 40% - 50% Capex of Rp 1 – 1.5 Tn for production capacity and distribution network expansion. Excellence in Execution 21 THANK YOU For further information: PT Kalbe Farma Tbk. Jalan Let.Jend. Suprapto Kav. 4 Jakarta 10510, Indonesia Tel. : 62-21-42873888 Fax. : 62-21-42873678 Email : [email protected] [email protected] [email protected] Website : www.kalbe.co.id Excellence in Execution 22 .