Tasty way to reduce cholesterol Analyst Gathering February 2014
Table of Contents BUSINESS OVERVIEW 3 INDICATIVE 2013 RESULTS & 2014 OUTLOOK 12 2
SECTION 1 Business Overview Tasty way to reduce cholesterol
MACRO OVERVIEW Macro Environment 2013 Indonesian Healthcare Spending Rupiah US Dollar (Exchange Rates on Transaction) Roll-out of National Healthcare Insurance - January 1, 2014 Minimum Wage Fuel Price Rp $$$ Skim Milk Price 2014 2019 Target: 100% population 250 million people Target: 50% population 121.6 million people, including 86.4 million poor population 4
BUSINESS STRATEGIES 1. Improve marketing and sales effectiveness Diabetasol Fun Walk 2013, 34,000 participants in 28 cities Fatigon Aksi Semangat 2013, 40,000 participants in 3 major cities CORPORATE BRANDING 2. Strengthen business portfolio through innovation and M&A 5
BUSINESS STRATEGIES 3. Expand distribution coverage 4. Go global deeper ASEAN penetration with more product offering New RDC New branches and existing branch capacity expansion Additional trucks & motorcycles 5. Enhance human capital development 6
2013 HIGHLIGHTS Strengthening production and distribution network Getting closer to our consumers Completed oncology production facilities at Pulogadung Increased production lines and capacities Direct to Consumer (DTC) Activities 2013 Diabetasol Entrasol Upgraded distribution facilities Pontianak Cirebon Fatigon Cerebrofort 7
2013 HIGHLIGHTS Expanding customer touch points Kalbe e-store Kalbe Home Delivery Kalbe Family Rewards Card KalCare Activities 8 KalCare Experiential Store Health Seminars Pre-school Field Trip KalbeMed Mobile Application
2013 HIGHLIGHTS Strenghtening Product Portfolio through Innovation New Product Launches Research & Development Stem Cell and Cancer Institute 9
2013 HIGHLIGHTS Cancellation of Treasury Stocks The treasury stocks have been cancelled in EGMS in May 2013. Outstanding Shares Number of Shares before cancellation 50,780,072,110 Number of Treasury Stocks cancelled (7.7%) 3,904,950,000 Number of Shares after cancellation 46,875,122,110 The treasury stocks cancellation does not affect the Company s financial position and EPS. The number of treasury stocks have been deducted from the total outstanding shares in the EPS calculation in our financial statements. 10
2013 HIGHLIGHTS Looking after all our stakeholders more than 400,000 participants Kalbe Junior Science Fair 2013 Environmental Sustainability Consumer Protection ISO 14001:2004 Certified Environmental Management System Dedicated Customer Care Team Attended by more than 84,000 visitors Kalbe Care Kalbe Care for Health : medical consultation, disaster relief, blood donor; more than 25,000 aid recipients, more than 3,000 employees involved 11
SECTION 2 Indicative 2013 Results & 2014 Outlook Tasty way to reduce cholesterol
Consolidated Sales Strong Top Line Growth of Internal Kalbe Products Net Sales (in Rp Bn) 17.4% 31 Dec 2012 31 Dec 2013 (Unaudited) 13,636 16,008 3,288 17.7% 3,869 16.6% 25.9% 3,012 2,149 2,505 3,792 5,188 12.6% 5,842 Prescription Pharmaceuticals Consumer Health Nutritionals Distribution & Logistics Consolidation 13
Consolidated Operating Performance Stable Margin Gross Profit Margin Operating Expenses to Net Sales Ratios 47.9% 47.9% 31 Dec 2012 31 Dec 2013 (Unaudited) 31.6% 32.1% 0.7% 0.9% 4.8% 4.7% Operating Profit Margin 26.2% 26.5% Selling & Marketing General & Administrative Research & Development 16.3% 15.9% 31 Dec 2012 31 Dec 2013 (Unaudited) 31 Dec 2012 31 Dec 2013 (Unaudited) Marketing efforts to drive brand awareness Research & Development activities for product developments 14
Consolidated Net Earnings Sustainable Earnings Growth Income Before Tax (in Rp bn) Net Income (in Rp bn) 2,308 + 10.8% 2,558 +10.8 % 1,734 1,922 31 Dec 2012 31 Dec 2013 (Unaudited) 31 Dec 2012 31 Dec 2013 (Unaudited) Income before tax margin declined from 16.9% in FY 2012 to 16.0% in FY 2013, partly reflecting foreign exchange translation impact. Rupiah closed at Rp 12,189 per 1 USD at the end of 2013, compared to Rp 9,670 per 1 USD at the end of 2012, and Rp 9,068 per 1 USD at the end of 2011. Net income margin declined from 12.7% in FY 2012 to 12.0% in FY 2013 due to lower income before tax margin. 15
Working Capital Management A Temporary Spike in Working Capital 158 142 122 43 45 44 27 31 Dec 2008 129 38 35 31 Dec 2009 120 110 115 107 31 Dec2010 Days of Account Receivables Days of Account Payables No. of days 108 114 50 57 31 Dec 2011 48 48 41 31 Dec 2012 Days of Inventories Net Operating Cycle 132 134 51 31 Dec 2013 (Unaudited) Temporarily higher level of raw materials inventory and impact of Rupiah depreciation Net Operating Cycle has been decreased by 26 days from 158 days in 2008 to 132 days in 2013 End-to-end supply chain management would be continuously implemented to overcome any fluctuation in inventory 16
Solid Financial Position Rp 0.85 Trillion of Net Cash Position Total Debt and Gearing Ratio Cash & Net Cash Balance 2,291 2,151 1,902 1,877 1,860 1,322 1,562 1,222 1,655 1,433 600 500 400 300 200 100 0 11.2% 7.9% 7.2% 2.3% 2.9% 0.5% 405 340 25 141 205 583 15.0% 10.0% 5.0% 0.0% 917 850 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 (Unaudited) FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 (Unaudited) Total Debt in Rp Billion Gearing Ratio Cash and Cash Equivalent in Rp Billion Net Cash in Rp Billion 17
OUTLOOK 2014 Earnings Guidance 2014 1. Year-on-year Sales Growth 14% - 16% 2. Operating Profit Margin 16.0%-17.0% 3. Earnings per Share growth of 15% - 17% * 4. Dividend payout ratio minimum 40% * Excluding the impact from foreign exchange translation Capex Rp 1 1.2 Tn for production capacity and distribution network expansion. 18
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 : vidjongtius@kalbe.co.id kartika.setiabudy@kalbe.co.id investor.relations@kalbe.co.id Website : www.kalbe.co.id 19