Recordati Industria Chimica e Farmaceutica

Earnings Release • Oct 27, 2016

2016 First nine months

CONFERENCE CALL – 27 OCTOBER 2016

First nine months 2016 highlights

• Revenue € 862,4 million, up 9.9%
• EBITDA € 280,0 million or 32.5% of sales, up 16,4%
• Operating income (EBIT) € 252,4 million or 29.3% of sales, up 18,5%
• Net income € 182,3 million or 21,1% of sales, up 19,5%
• Net debt € 100,2 million, an increase of € 11,4 million as compared to year-end 2015 following the acquisition of Italchimici S.p.A., Pro Farma AG and payment of the remaining 2015 dividend
• Acquisition of the Italian pharmaceutical company Italchimici S.p.A.
• Acquisition of the Swiss pharmaceutical company Pro Farma AG
• Agreement with Gedeon Richter for the commercialization of cariprazine
• Agreement with French public hospital (Assistance Publique Hopitaux de Paris) for the development and commercialization of a treatment for MSUD

Main product sales

Corporate products including drugs for rare diseases account for 61.7% of revenue

(million Euro)	Jan-Sep 2016	Jan-Sep 2015	Change %
Zanidip® (lercanidipine)	90.0	89.9	0.1
Zanipress® (lercanidipine+enalapril)	50.8	49.8	2.0
Urorec® (silodosin)	63.3	50.7	24.9
Livazo® (pitavastatin)	27.0	21.2	27.1
Other corporate products*	160.6	148.9	7.9
Drugs for rare diseases	140.6	112.1	25.5

3 * Include the OTC corporate products for an amount of € 45.8 million in 2016 and € 40.2 million in 2015 (up 14.2%).

A diversified product portfolio

Composition of revenue by geography

Sustained growth

(million Euro)	Jan-Sep 2016	Jan-Sep 2015	Change %
Italy	171.2	157.4	8.8
France	84.7	81.6	3.8
U.S.A.	77.4	60.0	28.9
Germany	72.7	68.6	6.0
Turkey	65.8	56.3	17.0
Spain	55.8	53.1	5.2
Russia, other CIS countries and Ukraine	56.1	52.0	7.8
North Africa	34.3	31.6	8.7
Portugal	29.5	28.9	2.0
Other W. Europe countries	27.5	20.2	36.0
Other CEE countries	24.6	23.6	4.3
Other international sales	132.8	125.0	6.2
TOTAL PHARMACEUTICALS	832.5	758.2	9.8
PHARMACEUTICAL CHEMICALS	29.9	26.2	14.1

(In local currency, millions)	Jan-Sep 2016	Jan-Sep 2015	Change %
Russia (RUB)	3,586.4	2,899.1	23.7
Turkey (TRY)	200.6	157.7	27.2
U.S.A. (USD)	86.4	66.9	29.1

Geographical breakdown of pharmaceutical revenue

First nine months 2016 results

Further margin growth

(million Euro)	Jan-Sep 2016	Jan-Sep 2015	Change %
Revenue	862.4	784.4	9.9
Gross Profit	595.1	532.8	11.7
as % of revenue	69.0	67.9
SG&A Expenses	273.5	262.5	4.2
as % of revenue	31.7	33.5
R&D Expenses	60.2	55.2	9.0
as % of revenue	7.0	7.0
Other Income (Expense), net	(9.0)	(2.0)	n.s.
as % of revenue	(1.0)	(0.3)
Operating Income	252.4	213.0	18.5
as % of revenue	29.3	27.2
Net Income	182.3	152.5	19.5
as % of revenue	21.1	19.4

First nine months 2016 results

Treatments for rare diseases, 45.7%

Primary & Specialty care, 26.1% (or 27,2% excluding non-recurring expenses of € 8.6 million resulting from the acquisitions of Italchimici S.p.A. and Pro Farma AG)

Financial position and Shareholders' equity

(million Euro)	30 Sep 2016	31 Dec 2015	Change
Cash and short-term financial investments	191.1	225.5	(34.4)
Bank overdrafts and short-term loans	(13.3)	(9.8)	(3.5)
Loans – due within one year	(40.7)	(34.5)	(6.2)
Loans – due after one year	(237.3)	(269.9)	32.6
NET FINANCIAL POSITION	(100.2)	(88.7)	(11.5)
SHAREHOLDERS' EQUITY	988.3	870.0	118.3

Financial projections

2016 targets

(million Euro)	2015 Actual	2016 Targets
Revenue	1,047.7	± 1,140
Operating income (EBIT)	278.5	± 325
Net Income	198.8	± 230

Company declarations, disclaimers and profile

DECLARATION BY THE MANAGER RESPONSIBLE FOR PREPARING THE COMPANY'S FINANCIAL REPORTS

The manager responsible for preparing the company's financial reports Fritz Squindo declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corresponds to the document results, books and accounting records.

Statements contained in this presentation, other than historical facts, are "forward-looking statements" (as such term is defined in the Private Securities Litigation Reform Act of 1995). These statements are based on currently available information, on current best estimates, and on assumptions believed to be reasonable. This information, these estimates and assumptions may prove to be incomplete or erroneous, and involve numerous risks and uncertainties, beyond the Company's control. Hence, actual results may differ materially from those expressed or implied by such forward-looking statements.

All mentions and descriptions of Recordati products are intended solely as information on the general nature of the company's activities and are not intended to indicate the advisability of administering any product in any particular instance.

Recordati, established in 1926, is an international pharmaceutical group, listed on the Italian Stock Exchange (Reuters RECI.MI, Bloomberg REC IM, ISIN IT 0003828271) with a total staff of around 4,000, dedicated to the research, development, manufacturing and marketing of pharmaceuticals. Headquartered in Milan, Italy, Recordati has operations in the main European countries, in Russia, in other Central and Eastern European countries, in Turkey, in the United States of America and in North Africa. An efficient field force of medical representatives promotes a wide range of innovative pharmaceuticals, both proprietary and under license, in a number of therapeutic areas including a specialized business dedicated to treatments for rare diseases. Recordati is a partner of choice for new product licenses for its territories. Recordati is committed to the research of new drug entities within the cardiovascular and urogenital therapeutic areas and of treatments for rare diseases. Consolidated revenue for 2015 is € 1,047.7 million, operating income is € 278.5 million and net income is € 198.8 million.

Contact Information Via M. Civitali 1 +39 02 48787393

Offices: Investor Relations: Website: Recordati S.p.A. Marianne Tatschke www.recordati.com 20148 Milano, Italy tatschke.m@recordati.it