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Company: Novolog (pharm-up 1966) Ltd. Date: 2022-03-14 Language: English Register to download
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March 14, 2022

# Full-Year Results 2021

Novolog Group

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### Forward Looking Statement

The presentation does not constitute a recommendation, advice, opinion or an offer to acquire securities of Novolog (Pharm Up 1966) Ltd (the "Company"), or an invitation to offer, and is intended solely for informational purposes. The information included in this presentation is a summary only and does not exhaust all the information on the Company and its business. This presentation was prepared by the Company as a general presentation about the Company for the sake of convenience only and is not intended to replace the need to review the Company's full reports as reported to the ISA via the Magna distribution site including the Company's immediate reports, and the Company's Periodic Report for 2021 ("Company's Reports") and does not replace independent examination and personal advice according to the unique needs of each investor.

This presentation includes forecasts, estimates, assessments and other information pertaining to future events and/or matters, whose materialization is uncertain and is beyond the Company's control, and which constitute forwardlooking information, as defined in the Securities Law, 1968. Such information may not materialize, in whole or in part, or may materialize in a manner significantly different to that forecast. Such information includes, inter alia, revenue, profit and EBITDA forecasts.

Forward-looking information is based solely on the Company's subjective assessment, based on facts and data regarding the current condition of the Company's business and macroeconomic facts and figures, all as known to the Company at the time of preparation of this presentation. The materialization or non-materialization of the forward-looking information will be affected, inter alia, by risk factors characteristic of the Company's activity, as well as by developments in the general environment, in market conditions and in external factors affecting the Company's activity which are beyond the Company's control. Considering the above, the Company's actual results and achievements in the future may differ materially from those presented at this presentation.

The Company does not undertake to update and/or change any such forecast and/or assessment to reflect events and/or circumstances postdating this presentation, including the Company's plans and strategy which may change, from time to time, in accordance with the decisions of the Company's Board of Directors.

The presentation may include information and/or data presented in a different manner and/or characterization and/or editing and/or segmentation than that presented in the Company's Reports. In any case, this presentation is not intended to be a substitute for the Company's Reports, and it is advised to refer to these Reports. In any event of inconsistency between what is stated in this presentation and what is stated in the Company's Reports required by law, what is stated in the Company's Reports shall prevail.

# Company Profile Delivering Health

Novolog operates to improve the field of healthcare in Israel and adapt it to the challenges of the future through three key segments: Healthcare logistics, Homecare and personalized healthcare and Medical information technological tools

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## Founded in 1966

Listed on the Tel-Aviv Stock Exchange in 2017 (TA125)

Major stakeholders: Udi Puzis, Mori Arkin, Eli Dahan and institutional investors

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- Approximately 800 employees
- Strong, stable, debt-free financial balance

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Dividend distribution policy on 70% of net profit

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## Our Vision is Based on Our Values

# Creating the future of healthcare

The Novolog Group is committed to be a leading healthcare services group in Israel and to support patients, physicians and healthcare organizations in Israel and internationally through our innovative, advanced, technology-based basket of products and services that are adaptable to trends and anticipated changes in the healthcare services sector

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# Strategic Goals Well-defined Strategy to Drive Growth

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Operate complex and supplementary logistics services for medicines, medical devices, and clinical trials

Reduce public healthcare organizations' costs, thereby helping them improve the quality of the services that they provide

Improve the public's access to high-quality, innovative, and personalized healthcare services

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Full-Year Results 2021 | March 14, 2022

Complex logistics services including import and distribution of pharmaceuticals and medical devices, as well as clinical trial logistics management

High quality medical care based on innovation, compassion, and personalized care

Medical information technological tools, and digital services to patients, physicians, and medical institutions

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## Logistics Division

# Senior Strategic Logistics Partner of Global Pharma and Medical Device companies

Novolog group is a senior strategic logistics partner of global pharma companies operating in Israel. Novolog uses state-ofthe-art technologies to operate a variety of services for these companies, while complying with the most stringent quality assurance procedures

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The logistics division allows healthcare professionals to do their best work by providing a comprehensive set of customized advanced supply chain, management services and solutions

### **Pharma logistic services**

Specializes in storage, distribution and logistic services for the pharmaceutical, Medical Device and narcotics industries and operates a state-of-the-art logistics center

### **Clinical trial logistical services**

While adhering to the strictest quality control procedures, Novolog delivers the medication and medical devices for hundreds of clinical trials each year, including comprehensive logistical support

### **Supplementary pharma and biotech services**

Registration, regulatory processes, translation, Responsible Pharmacist services, national-level pharmacovigilance, clinical trial application submission, and more

# **EO sterilization**

Novolog has sterilization chambers in a range of volumes, all using advanced EO sterilization technologies, specially designed for the medical device industry

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Healthcare Division

# Improving Quality of Care

Novolog's Healthcare Division works with hospitals, leading insurance providers, pharmaceutical companies, and all of the Israeli national HMOs to provide technologybased healthcare services to patients in their homes and in the community

**Hundreds** of patients intubated at home

# **Hundreds**

of home medical visits per month

# **Dozens**

treatment programs for chronically ill patients

# **Dozens**

of patients in at-home hospice care

# Improving Healthcare Access and Convenience

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**Home Care Services**

At-home hospitalization, ambulatory homecare, providing respiratory care, sleep medicine services.

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**Healthcare Management**

Building and operating customized management systems for the insurance sector and manage patient support programs

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**Distribution**

Sales and distribution of medication to institutional customers

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### **National Healthcare Projects**

Partnerships with national organizations

### Healthcare Division Services

# Making Healthcare Personal

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### **Personalized Concierge Medicine**

Established Israel's first personalized healthcare management center, providing comprehensive testing and expert treatment services in clinics and in patients' homes., as well as operating Israel's largest private gastroenterology, hepatology, and nutrition clinic

# **Advanced Ophthalmology Centers**

Operates Israel's largest network of clinics dedicated exclusively to eye care and surgery, with over 50 leading ophthalmologists performing more than 10,000 surgeries per year

# **Full Private Laboratory Services**

Manages the largest private medical laboratory in Israel, providing full laboratory services to medical and veterinary centers, private patients, research institutions, and the Israeli and international medical and biotech industries

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## Digital Health Division

# Enabling Patient Access

Novolog's digital health division is providing patients with unprecedented access to treatment information, scheduling, and communication with care providers, giving them newfound control over their therapeutic process and their interactions with the medical system

**The result:** a high-quality, accessible treatment experience that goes beyond public medical care

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**Millions** of content views per month

# **Thousands**

of telemedicine video appointments

# **Millions**

of visits scheduled through smart scheduling

Digital Health Division Services

# Technological Tools Suitable for the New Era of Healthcare Services

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### **Smart Scheduling platform**

- Enables patient self-scheduling
- Customizable
- Minimizes no-shows

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### **Telemedicine platform**

- Video consultations
- Digital prescriptions
- Real-time file sharing

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### **Medical content platforms**

- Healthcare provider reviews
- Expert information for patients
- Forums and search features

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# International Healthcare

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Full-Year Results 2021 | March 14, 2022

# Growth Through Innovation

Novolog has partnered with medflex, one of Germany's leading telemedicine providers

medflex is a fast-growing telemedicine company based in Konstanz, Germany. The certified medical messenger and video consultation service enables doctors and other health professionals to communicate with patients and among each other through one seamless, intuitive, and secure platform. Its reimbursable video consultation solution is end-to-end encrypted and certified according to the guidelines by the association of Statutory Health Insurance Physicians (KBV)

The health sector in Germany is the largest of its kind in Europe and is considered one of the most promising markets with high growth-potential globally. Healthcare spending in Germany exceeds €400 Billion, in a population amounting to 83 million people. In 2019, the German parliament passed the Digital Care Act (DVG) to accelerate digitalization and innovation within the German healthcare market. The act also paves the way to broaden usage and reimbursable of digital health applications, such as medflex' telemedicine solution

The last year has led to a steep increase in the usage of video consultations among physicians. Thus, telehealth has rapidly evolved from a nice-to-have into a necessity for doctors as well as patients

FY 2021 Financial Overview

Full-Year Results 2021 | March 14, 2022

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- **In March 2022**, the company announced distribution of dividend in the amount of NIS 15.4 million
- **In 2021**, the company announced distribution of dividend in the amount of NIS 32 million
- **In February 2022**, the company acquired 55% of the shares of Ein Tal in the amount of NIS 32 million
- **In December 2021**, a subsidiary company exercised a call option to purchase the remaining shares of Odoro in the amount of NIS 8 million
- **In September 2021**, the company completed the purchase of the remaining shares of Dor in the amount of NIS 5 million
- **In September 2021**, a subsidiary company acquired Gastromed

# 2021 Results Excluding IFRS16

|                     | 2021    | 2020    | % Change |
|---------------------|---------|---------|----------|
| Revenues            | 1,255.2 | 1,133.6 | 10.7%    |
| Gross Profit        | 148.9   | 128.8   | 15.6%    |
| Operating Profit    | 67.6    | 54.7    | 23.6%    |
| Net Profit          | 47.2    | 40.2    | 17.5%    |
| Adjusted EBITDA (*) | 99.1    | 84.8    | 16.9%    |

# (NIS millions)

GROSS PROFIT +16% OPERATING PROFIT +24%

ADJUSTED EBITDA +17%

(\*) Adjusted EBITDA is EBITDA after neutralizing expenses unrelated to the routine operation of the Company's businesses

# 2021 Results Including IFRS16

|                       | 2021    | 2020    | % Change | GROSS PROFIT<br>+15%     |
|-----------------------|---------|---------|----------|--------------------------|
| Revenues              | 1,255.2 | 1,133.6 | 10.7%    |                          |
| Gross Profit          | 149.0   | 129.3   | 15.2%    | OPERATING PROFIT<br>+14% |
| Operating Profit (**) | 69.9    | 61.1    | 14.5%    |                          |
| Net Profit (**)       | 44.8    | 40.6    | 10.5%    | ADJUSTED EBITDA<br>+13%  |
| Adjusted EBITDA (*)   | 119.3   | 105.2   | 13.4%    |                          |

# (NIS millions)

(\*) Adjusted EBITDA is EBITDA after neutralizing expenses unrelated to the routine operation of the Company's businesses

(\*\*) In 2020, a non-recurring capital gain of NIS 4 million was recognized as a result of IFRS16. The operating profit after neutralizing the non-recurring capital gain increased by NIS 12.9 million, an increase of 23%. The net profit after neutralizing the non-recurring capital gain increased by NIS 8.3 million, an increase of 23%

# Q4 2021 Results Excluding IFRS16

|                     | Q4 2021 | Q4 2020 | % Change |
|---------------------|---------|---------|----------|
| Revenues            | 299.7   | 273.8   | 9.5%     |
| Gross Profit        | 38.5    | 35.2    | 9.4%     |
| Operating Profit    | 16.5    | 13.9    | 18.4%    |
| Net Profit          | 10.8    | 9.1     | 18.5%    |
| Adjusted EBITDA (*) | 25.1    | 21.8    | 15.1%    |

(NIS millions)

GROSS PROFIT

+9%

OPERATING PROFIT +18%

ADJUSTED EBITDA +15%

(\*) Adjusted EBITDA is EBITDA after neutralizing expenses unrelated to the routine operation of the Company's businesses

# Q4 2021 Results Including IFRS16

|                     | Q4 2021 | Q4 2020 | % Change |
|---------------------|---------|---------|----------|
| Revenues            | 299.7   | 273.8   | 9.5%     |
| Gross Profit        | 38.2    | 36.1    | 6.0%     |
| Operating Profit    | 16.8    | 14.4    | 16.2%    |
| Net Profit          | 9.8     | 8.3     | 18.1%    |
| Adjusted EBITDA (*) | 30.2    | 27.1    | 11.4%    |

# (NIS millions)

GROSS PROFIT +6% OPERATING PROFIT +16%

ADJUSTED EBITDA +11%

(\*) Adjusted EBITDA is EBITDA after neutralizing expenses unrelated to the routine operation of the Company's businesses

# 2021 Results By Segment Excluding IFRS16

# (NIS millions)

|                              | Revenues |         |     | Adjusted EBITDA |      |     |
|------------------------------|----------|---------|-----|-----------------|------|-----|
|                              | 2021     | 2020    | %   | 2021            | 2020 | %   |
| Logistics                    | 1,097.8  | 1,028.5 | 7%  | 63.1            | 53.8 | 17% |
| Health Care<br>(*)           | 140.8    | 98.3    | 43% | 27.9            | 23.2 | 20% |
| Digital Health               | 25.8     | 22.8    | 13% | 8.1             | 7.8  | 5%  |
| Intercompany<br>Transactions | )9.2(    | )16.0(  |     | -               | -    |     |
| Total                        | 1,255.2  | 1,133.6 | 11% | 99.1            | 84.8 | 17% |

(\*) Salus company is consolidated as of the fourth quarter of 2020, AML company is consolidated as of the second quarter of 2021 and Gastromed company is consolidated as of the fourth quarter of 2021

# Q4 2021 Results By Segment Excluding IFRS16

# (NIS millions)

|                              |         | Revenues |     |         | Adjusted EBITDA |     |
|------------------------------|---------|----------|-----|---------|-----------------|-----|
|                              | Q4 2021 | Q4 2020  | %   | Q4 2021 | Q4 2020         | %   |
| Logistics                    | 254.5   | 247.6    | 3%  | 16.3    | 13.6            | 20% |
| Health Care<br>(*)           | 38.5    | 27.7     | 39% | 6.5     | 6.0             | 9%  |
| Digital Health               | 6.9     | 6.1      | 13% | 2.3     | 2.2             | 4%  |
| Intercompany<br>Transactions | )0.2(   | )7.6(    |     | -       | -               |     |
| Total                        | 299.7   | 273.8    | 9%  | 25.1    | 21.8            | 15% |

(\*) Salus company is consolidated as of the fourth quarter of 2020, AML company is consolidated as of the second quarter of 2021 and Gastromed company is consolidated as of the fourth quarter of 2021

# 2021 Balance Sheet Including IFRS16

|                            | 31/12/2021 | 31/12/2020 |
|----------------------------|------------|------------|
| Cash                       | 239        | 176        |
| Current<br>assets          | 1,742      | 1,708      |
| Non-current<br>assets      | 546        | 479        |
| Current<br>liabilities     | 1,689      | 1,734      |
| Non-current<br>liabilities | 169        | 157        |
| Equity                     | 430        | 296        |
| Total<br>assets            | 2,288      | 2,187      |

# (NIS millions)

CASH NIS 239M EQUITY NIS 430M

DEBT NIS 1.3M

# Growth Engines

Expanding personalized healthcare services Leverage Digital Health Division Services Adding more services for the pharmaceutical industry Entering new international markets Developing additional home care services for the institutional market Entering new market segments

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Long Term Guidance

# Uniquely Positioned To Deliver Value To Stakeholders

Novolog accomplished its long-range growth plan from 3 years ago

As part of our long-range growth plan, we estimate that Novolog will double its Adjusted EBITDA (Excluding IFRS16) within 4 years, mainly from its activities in Israel

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**Strong financial performance**

Novolog has a consistent track record of delivering strong and stable financial performance

**Diversification**

Future growth will be fueled by all three divisions

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## **Responsible approach**

The Company is not leveraged and invests responsibly. The Group strengthened its capital structure last year

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# **Capital allocation priorities**

Investing for continued growth and maximizing value to our shareholders

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### **Reinvest for growth**

Investing in processes and ventures that lead to organic growth and generate higher profits

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### **Acquisitions**

Acquisitions that support our strategies

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### **Returns to our shareholders**

Dividend policy – 70% of the net profit

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# Thank you!

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[info@Novolog.co.il](mailto:info@Novolog.co.il) | www.Novolog.co.il