Zur Rose Group AG

Investor Presentation • Mar 18, 2021

2020 Results – Analyst & Media Conference Call Walter Oberhänsli | Marcel Ziwica | Walter Hess 18 March 2021

Today's Presenters

ZurRose Group ZurRose Zur Rose Group Walter Oberhänsli Founder, Group CEO Marcel Ziwica Group CFO

Walter Hess Head Germany

2020 in review

e-prescriptions to become mandatory in Germany from 2022

Revenue growth accelerates to

14.4%

Convertible bond and capital increase: CHF 388 million raised for further growth

DocMorris+ healthcare platform and app launch represent strategic milestones on the way to an integrated healthcare platform

DocMorris Christmas film generates

147 million

views worldwide on social media

European market leadership extended: acquisition of the mail-order and diabetes activities of the

Apotal Group

Significant revenue growth in all markets: Germany 16.5% Switzerland 7.1% Europe 73.5%

DocMorris

to become the umbrella brand for the European healthcare ecosystem

Acquisition of TeleClinic,

Germany's leading provider of telemedicine

Number of active customers exceeds 10 million

Digital healthcare platform of Zur Rose Group AG and insurers Allianz Care, CSS and Visana sets new standards in Swiss healthcare

TeleClinic online consultations up 500%

Summary FY2020 Financial Results

Summary FY 2020 results

2020 targets achieved

Sales growth of over 10% y-o-y (including Medpex, Apotal)

+14.4% y-o-y in local currency

Break even on adjusted EBITDA level and before expenses for additional growth initiatives, especially in the area of electronic prescriptions and for European opportunities

Adjusted EBITDA before growth initiatives of CHF -0.9 million translates to operational improvements of CHF 29.9 million

Group Sales growth of 14.4% - well ahead of guidance

Group

— Demand partly accelerated by Covid

CH

— Accelerated growth above market

DE

• Focus on eRx
• Strong performance in core OTC brands
• Apotal acquisition further extending leadership position (2019 sales of EUR 157 million)

EU

— Strong performance driven by new customer acquisition

Expanding market leadership with more than 10 million active customers

Notes: Figures reflecting performance of entire B2C & marketplace business regardless of integration and consolidation progress of the acquired businesses with Apotal only included in active customer numbers; all numbers reflecting the performance in the last twelve months period ending as indicated | 1 Customers, supplied by the Zur Rose Group either directly or via its partners, placing an order within the past twelve months | 2 Share of orders from existing customers in relation to total number of orders | 3 Number of website visits | 4 Basket size equals average value of the purchase per order | 5 Number of orders per active customer in 12 months period

Operational performance improved driven by gross margin

in million CHF	FY 2019	Margin in %	FY 2020	Margin in %
Sales incl. Medpex, Apotal	1'568.7		1'751.9
Sales reported	1'355.5		1'476.9
Gross profit adj.	208.7	15.4	250.9	17.0
Personnel expenses adj.	(112.8)	(8.3)	(126.8)	(8.6)
Marketing expenses	(53.2)	(3.9)	(60.6)	(4.1)
Other operating income & expenses adj.	(82.9)	(6.1)	(94.7)	(6.4)
Adj. EBITDA	(40.2)	(3.0)	(31.2)	(2.1)
Adjustments	26.4	2.0	(47.2)	(3.2)
EBITDA	(13.8)	(1.0)	(78.4)	(5.3)
EBIT	(45.7)	(3.4)	(117.6)	(8.0)
Net income	(52.4)	(3.9)	(135.6)	(9.2)

• Sales growth above guidance
• Strong development of gross margin mainly driven by German OTC business
• Growth initiatives included in expenses
• Adjusted EBITDA improving by CHF 9.0 million
• Depreciation increased due to M&A and tech development
• Finance expenses increased due to convertible and bond interest payments

Adj. EBITDA before growth initiatives in line with guidance

• Positive effect from earn-out reevaluation and disposal of assets to medbase JVs

• Integration related expenses of CHF 2.5 million

• Share based retention package for founders as largest position within M&A adjustments

• Increase of accruals due to an interim ruling in VAT proceedings connected to Rx bonuses
• CHF 29.9 million increase in profitability excluding expenses in growth initiatives compared to 2019

Zur Rose Group income statement

Run-rate analyses - assuming full integration - shows a steady state EBITDA margin of 2-3% in relation to current Sales

ZurRose Group ZurRose Group

Strong financial position ahead of eRx roll-out

in million CHF	31 Dec 2019	%	31 Dec 2020	%
Cash and cash equivalents	204.7		300.6
Receivables	152.6		145.4
Inventories	70.6		92.9
Property, plant & equipment	77.1		96.6
Intangible assets	465.3		604.5
Other assets	21.4		38.5
Total assets	991.7		1278.5
Financial liabilities	125.5		86.7
Payables & accrued expenses	127.2		149.9
Bonds	312.1		483.9
Other liabilities	21.4		26.3
Equity	405.5	40.9	531.7	41.6
Total equity and liabilities	991.7	100.0	1278.5	100.0

• Highly attractive, asset-light business model
• Strong liquidity position with CHFm 300 of cash on balance sheet
• Increased inventory due to COVID-19
• Acquisitions adding to PPE and intangible assets
• Equity base strengthened with CHF 213 million capital increase

Increasing online penetration through eRx expected, unlocking substantial upside potential

Illustrative, assuming constant total market size of 49.1bn Source: 1 Sempora 2018 incl. VAT

eRx opportunity

Roadmap of German government / gematik leads to multiple implementation scenarios

• Launch of national gematik infrastructure targeted for July 2021
• Connection of remaining doctors and pharmacies to Telematik infrastructure and roll-out of eRx capabilities
• Specifications on gematik APIs for third party apps expected to be published in Q2 21
• Handling and adoption of identification & authentication processes

Roadmap Zur Rose Group: Preperation for full acceleration of eRx scaling

• Journey mapping for each e-script redemption scenario
• Readiness of all webshops / apps
• Backend readiness at all locations
• Roll-out and scale digital healthcare ecosystem

Foundation for eRx set in pre-gematik phase to ensure implementation

• Zur Rose as pioneer and driver of eRx technology solutions
• "eRezept Deutschland" project is live with first e-scripts handled via insurance apps
• Proof of technology achieved
• Important building blocks for eRx implementation created within pre-gematik phase

Marketing campaign – Drive awareness ahead of and during eRx launch

• Further increase leading brand awareness
• Expand brand values of DocMorris from e-commerce to digital health provider as initiated via viral Christmas campaign with 147 million views
• Activate customers ahead of eRx launch

Further evolve eRx app by adding features and partners

• Expand customer journey from diagnosis to delivery via integration of telemedicine, same day delivery and click & collect
• Development roadmap: eRx readiness and further improve customer experience
• Convert partner pipeline post same day delivery and click & collect launch

TeleClinic integration in DocMorris website unlocks first synergies

• Integration of Online Doctor function to DocMorris website completed
• Better customer experience by offering digital journey via telemedicine and online pharmacy

Brand Integration and Logistics Capacity

Brand integration and logistics capacity

Brand integration – Transition towards single brand initiated

• DocMorris will be the lead brand across Europe
• Branding transition started with launch of new logo and campaign
• Step-by-step brand integration to optimise customer transition metrics
• Vitalsana brand integration completed

Brand integration and logistics capacity

Extension of new distribution center on track

• Installation of warehouse automation in the new distribution center on track
• Increased degree of automation of 70% will lead to productivity improvements
• Additional capacity of 15 million parcels per year to be available in 2022 resulting in total capacity of 48 million parcels

23

Technology & New Business

Zur Rose has evolved towards a tech company setting the foundation for Europes leading Healthcare Ecosystem Technology & new business

• 3 Tech Hubs in Berlin, Barcelona and Zurich¹
• Agile culture and continuous deployment
• 200+ employees from 20 nationalities
• Tech background: software engineers, data scientists, UX designers and product managers
• Product focus: eRx, marketplaces, telemedicine, digital health journeys, PaaS

Leveraging best-in-class digital solutions and convenient access to products and services to improve lives of people with chronic conditions – Novo Nordisk partnership on obesity Technology & new business - Healthcare ecosystem

26 Note: Illustration displays one of many potential journeys which also include physical doctor visits, redemption of scripts in brick-and-mortar pharmacies, etc.

Technology & new business - Healthcare ecosystem

Leveraging best-in-class digital solutions, convenient access to products and services to improve the lives of people with chronic conditions – DiGA portal at Teleclinic

Raising awareness and enabling convenient, online access to Digital Health Apps reimbursed by insurers in Germany (DiGAs) via TeleClinic

Technology & new business - Platform as a Service

Growing interest in self developed tech assets is enabling the launch of a new PaaS business model

• Insurance cooperation in Switzerland¹ and gematik tender to provide eRx server as first use cases
• Third parties may accelerate time to market and enhance user experience with marketplace and digital health services
• Growth and profitability opportunity

Technology & new business - Marketplace Europe

Enabling a truly European Healthcare Ecosystem

• Continue on growth trajectory
• Shift to DocMorris brand and invest in branding
• Explore extension to further geographies/ product categories

Summary of Strategic Priorities 2021

Growth focus	1 1. Continue on growth trajectory pre and post eRx introduction 2 2. Change of behavior via marketing campaign 3 3. Scale new business including telemedicine and ecosystem collaborations
eRx opportunity	1 1. eRx readiness across journeys & products 2 2. Take full advantage of eRx opportunity
Brand integration & logistics capacity	1 1. Continue building new European Ecosystem brand DocMorris with Promofarma and Doctipharma migrations
	2 2. Increase capacity in new warehouse with next level automation
Path to profitability	1 1. Speed and productivity improvements 2 2. Drive tech development to improve user experience 3 3. Scale PaaS business model

Financial outlook

Group Outlook 2021: Continued strong sales growth and marketing push ahead of eRx introduction

Outlook For 2021 management expects sales growth of around 20% including Medpex and Apotal

First eRx sales are expected after the launch of gematik infrastructure currently targeted for July 2021 and to accelerate with the mandatory introduction in 2022

A large marketing campaign to drive awareness of the European lead brand DocMorris has been initiated in February

Break-even on EBITDA is targeted within 12-18 months after 2021

Outlook

Mid-term targets: Huge potential of increasing online penetration of Rx & EBITDA margin target of 8%

ZurRose Group ZurRose Group

Management is convinced of the growth opportunity driven by the introduction of electronic prescriptions in Germany and believes that online penetration of Rx can reach a level of around 10% in the mid-term (time horizon of 3 to 5 years) with further potential beyond this time period

Towards the beginning of the guidance period management expects to grow revenue to above CHF 4 billion

The medium-term EBITDA margin target is confirmed at around 8%

The implementation of the healthcare eco-system is creating meaningful potential for additional revenue and profit upside ³⁴

Outlook

Group

Mid-term financial targets – path to profitability

% of sales Notes: Illustrative, not true to scale 1 including personnel and distribution expenses 35

Income Statement

		2020		2019		2018(1)
	CHF m	%	CHF m	%	CHF m	%
Sales	1'476.9		1'355.5	100.0	1'207.1	100.0
Cost of goods	(1'235.6)		(1'146.9)		(1'015.9)(2)
Other income	14.8		42.0		3.1(2)
Personnel expenses	(142.9)	(9.7)	(117.5)	(8.7)	(93.7)	(7.8)
Marketing expenses	(60.6)	(4.1)	(53.2)	(3.9)	(41.3)	(3.4)
Distribution expenses	(49.2)	(3.3)	(41.9)	(3.1)	(33.1)	(2.7)
Administrative expenses	(50.9)	(3.4)	(34.9)	(2.6)	(24.9)	(2.1)
Rent expenses	(4.9)		(4.0)		(6.0)
Fair Value adjustment	(0.4)		(2.9)		(1.5)
Other operating expenses	(25.7)		(10.1)		(7.9)
EBITDA	(78.4)	(5.3)	(13.8)	(1.0)	(14.0)	(1.2)
D&A	(39.3)		(31.9)		(18.9)
EBIT	(117.6)	(8.0)	(45.7)	(3.4)	(32.9)	(2.7)
Financial result	(15.6)		(4.4)		(5.7)
EBT	(133.2)	(9.0)	(50.1)	(3.7)	(38.5)	(3.2)
Income tax expenses	(2.4)		(2.3)		(0.6)
Net income	(135.6)	(9.2)	(52.4)	(3.9)	(39.1)	(3.2)

Zur Rose Group financials

Balance Sheet

		31 Dec 2020		31 Dec 2019		31 Dec 2018
	CHF m	%	CHF m	%	CHF m	%
Cash and cash equivalents	300.6		204.7		230.7
Current financial assets	0.4		0.2		0.2
Trade receivables	114.9		126.7		92.3
Other receivables & prepaid expenses	30.4		25.8		24.2
Inventories	92.9		70.6		69.4
Current assets	539.3	42.2	428.1	43.2	416.7	57.4
Property, plant & equipment	96.6		77.1		34.3
Intangible assets	604.5		465.3		264.6
Other assets(1)	38.1		21.3		10.9
Non-current assets	739.2	57.8	563.7	56.8	309.8	42.6
Total assets	1278.5	100.0	991.7	100.0	726.5	100.0
Current financial liabilities	6.8		87.4		3.5
Trade payables	93.3		92.1		83.1
Other payables & accrued expenses(2)	50.6		33.1		32.3
Short-term liabilities	156.7	12.3	212.6	21.4	119.0	16.4
Non-current financial liabilities	79.9		38.1		30.6
Bonds	483.9		312.1		114.1
Pension liabilities	18.0		15.2		13.7
Deferred taxes & long-term provisions	8.3		8.2		5.5
Long-term liabilities	590.1	46.2	373.6	37.7	163.9	22.6
Equity	531.7	41.6	405.5	40.9	443.6	61.1
Total equity and liabilities	1278.5	100.0	991.7	100.0	726.5	100.0

ZurRose Group

Note: 1 Includes investments in JVs, non-current financial assets and deferred tax assets | 2 Includes other payables, tax payables, accrued expenses and short-term provisions

Zur Rose Group financials

Cash Flow Statement ^{2020 2019 2018}(2)

CHF m
Net income	(135.6)	(52.4)	(39.1)
D&A	39.3	31.9	18.9
Non cash items financial result	1.8	(2.2)	3.2
Non cash income and expenses	18.0	(35.3)	3.4
Income taxes paid	2.4	2.3	0.6
Change in trade receivables, other receivables and prepaid expenses	13.5	(37.3)	(12.2)
Change in inventories	(20.1)	(3.4)	(10.3)
Change in trade payables	8.9	13.5	4.1
Change in provisions	4.0	0.4	(1.8)
Cash flow from operating activities	(67.5)	(82.6)	(33.2)
Acquisition & Sale of subsidiaries, net	(116.0)	(103.1)	(108.6)
Purchase of property, plant and equipment	(26.4)	(10.4)	(10.3)
Acquisition of intangible assets	(33.4)	(31.1)	(21.2)
Investments/ (disposal) of financial assets	(24.0)	1.4	(0.2)
Cash flow from investing activities	(199.9)	(143.2)	(140.3)
Proceeds from capital increases	206.1	0.5	191.1
Transaction costs of capital increase	-	(0.3)	-
Increase in financial liabilities	171.4	205.0	114.1
Repayment of financial liabilities	(13.5)	(5.0)	(1.8)
Purchase of treasury shares	1 (0.7)	(0.0)	(6.4)
Cash flow from financing activities	363.2	200.2	297.1
Total cash flow	(95.9)	(25.6)	123.6
Fx differences	0.1	(0.5)	(0.6)
ZurRose Note: 1 includes acquisition of non -controlling interests Bluecare 2 restated Group			39

Group

Disclaimer

This presentation (the "Presentation") has been prepared by Zur Rose Group AG ("Zur Rose" and together with its subsidiaries, "we", "us" or the "Group") solely for informational purposes and has not been independently verified and no representation or warranty, express or implied, is made or given by or on behalf of any of the Group. Zur Rose reserves the right to amend or replace the Presentation at any time, and undertakes no obligation to provide the recipients with access to any additional information. Zur Rose shall not be obligated to update or correct the information set forth in the Presentation or to provide any additional information. Nothing in this Presentation is, or should be relied upon as, a promise or representation as to the future. Certain statements in this Presentation are forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial consequences of the plans and events described herein. Actual results may differ from those set forth in the forward-looking statements as a result of various factors (including, but not limited to, future global economic conditions, changed market conditions, intense competition in the markets in which the Group operates, costs of compliance with applicable laws, regulations and standards, diverse political, legal, economic and other conditions affecting the Group's markets, and other factors beyond the control of the Group). Neither Zur Rose nor any of its respective directors, officers, employees, advisors, or any other person is under any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak of the date of this Presentation. Statements contained in this Presentation regarding past trends or events should not be taken as a representation that such trends or events will continue in the future.

This Presentation does not constitute or form part of, and should not be construed as, an offer or invitation or inducement to subscribe for, underwrite or otherwise acquire, any securities of Zur Rose, nor should it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securities of the Group, nor shall it or any part of it form the basis of, or be relied on in connection with, any contract or commitment whatsoever. This Presentation is not a prospectus and is being made available to you solely for your information and background and is not to be used as a basis for an investment decision in securities of Zur Rose or the Group.