Zur Rose Group AG

Earnings Release • Aug 19, 2020

Zur Rose Group

H1 2020 Results Conference Call

Today's Presenters

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

Olaf Heinrich Head Germany

H1 2020

Highlights

1	#1 position for eRx	— — —	Bundestag passed PDSG law making eRx mandatory starting 2022 Strong partner network established for pre-Gematik roll-out TeleClinic acquisition as strong addition to eRx approach
2	Market Leadership	— —	Excellent organic growth of DocMorris and medpex customers1 Apotal acquisition adding 1.1 million high quality
3	Delivering profitable growth	— —	Gross margin improved significantly, while maintaining growth momentum On track to achieve FY targets
4	Healthcare Ecosystem	— —	Telemedicine important building block of Ecosystem offering Innovating consumer journeys from awareness, diagnosis, treatment to adherence
5	Strategic initiatives on track	— —	Full focus on eRx marketplace app launch targeted for Q4 2020 Strong financial position ahead of eRx roll-out

Financial Update

Group Sales growth of around 10% in line with guidance

CH

• Sustainable growth
• Stockpiling in Q1 and COVID-19 restrictions for doctor visits resulting in softer Q2

DE

EU

• Focus on eRx
• Stockpiling in Q1
• Strong performance in core OTC brands
• Apotal acquisition further extending leadership position (2019 sales of EURm 157)
• Strong performance in H1

Expanding market leadership with more than 9 million active customers

Notes: Figures reflecting performance of entire B2C & marketplace business regardless of 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 30 June 2019 and 30 June 2020 respectively | 1 Customers 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

7

7

Operational performance improved driven by gross margin

H1 2019	Margin in %	H1 2020	Margin in %
771.3		841.9
668.4		698.0
104.8	15.7	121.4	17.4
(58.4)	(8.7)	(60.9)	(8.7)
(24.4)	(3.7)	(27.6)	(4.0)
(42.4)	(6.3)	(44.4)	(6.4)
(20.4)	(3.1)	(11.5)	(1.6)
17.9	2.7	(13.0)	(1.9)
(2.5)	(0.4)	(24.5)	(3.5)
(17.1)	(2.6)	(42.0)	(6.0)
(17.1)	(2.6)	(52.3)	(7.5)

• Growth track record continued in line with guidance
• Strong development of gross margin
• Adjusted EBITDA improving by CHFm 8.9
• Finance expenses increased due to bond and convertible interests and exchange rate

EBITDA adjusted before growth initiatives in line with FY guidance

• Positive effect from earn-out reevaluation
• Integration related expenses of CHFm 2.0
• Share based retention package for founders as largest position within adjustments
• EBITDA adj. improved by 1.5 ppt

Run-rate analyses - assuming full integration - shows an EBITDA margin of 2-3% in relation to current sales

Strong financial position ahead of eRx roll-out

in million CHF	31 Dec 2019	%	30 June 2020	%
Cash and cash equivalents	204.7		258.0
Receivables	152.6		159.1
Inventories	70.6		105.7
Property, plant & equipment	77.1		75.1
Intangible assets	465.3		458.6
Other assets	21.4		25.1
Total assets	991.7		1081.6
Financial liabilities	125.5		72.8
Payables & accrued expenses	127.2		145.5
Bonds	312.1		483.2
Other liabilities	21.4		20.7
Equity	405.5	40.9	359.4	33.2
Total equity and liabilities	991.7	100.0	1081.6	100.0

• Highly attractive, asset-light business model
• Strong liquidity position with CHFm 258 of cash on balance sheet
• Increased inventory due to COVID-19
• Equity base recently further strengthened with CHFm 213 capital increase

Strategy Update

Strategy update

Key strategic initiatives

Healthcare Ecosystem	1. Easing and innovating health journeys - with TeleClinic acquisition 2. Partnerships with best-in-class digital solutions in the pipeline 3 3. Enabled by leading developments in technology
eRx opportunity	#1 position in OTC with 8 million customers in Germany1 1. as pole position for eRx introduction 2 2. First mover strategy, actively preparing for eRx launch 3 3. Launch of eRx marketplace app
Integration & synergies	1 1. Integration fully on track; focus on efficiency and operational excellence 2 2. medpex performance as benchmark for German OTC business 3 3. Branding strategy to be finalized in H2

manage their health in To create^a world where can everyone one click

Health in one click

—Personalized treatment journeys

• —Convenient access to products and best-in-class digital solutions
• —Ensured effective medication and better outcomes

Creating seamless consumer journeys from awareness, diagnosis, treatment to adherence

Leveraging best-in-class digital solutions and convenient access to products for better lives

Zur Rose Group Ecosystem

From Diagnosis to Delivery – Acquisition of TeleClinic adds important building block of customer journey to the Group

• Germany's leading telemedicine provider
• Reimbursable consultation services compliant with German national health insurance scheme
• E-scripts expected to be issued for up to 50% of consultations

Telemedicine gaining momentum in recent months

«Telemedicine: every second user prefers video consultation hours over visits to the doctor» Bitkom Study: «Digital Health 2020»

«Telemedicine is laying the roadmap for healthcare's future» Entrepreneur.com, August 3, 2020

«62% of Germans open to telemedicine (vs. 49% in 2019)» STADA Health Report 2020

Regulatory update: eRx mandatory in Germany from 2022 onwards

• PDSG law passed German Bundestag, making eRx mandatory from 2022 onwards
• Access to eRx server will be possible for all market participants, including EU mail-order pharmacies
• Gematik solution as backbone with interface to third party applications
• Value-added services will become key differentiator for pharmacies competing over eRx

Increasing online penetration through eRx expected, unlocking substantial upside potential

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

Adoption curve of marketplace approach expected to be much higher than e-commerce only approach

Zur Rose Group

Preparation for take-off fully accelerated

Cooperation with insurance companies / General reimbursement scheme targeted for Q4 2020

of German population eligible for e-script reimbursement

26

Partnerships and eHealth-Tec B2B solutions ready for scaling eRX opportunity Marketplace / Apps

Physical doctor

Physician information system

Telemedicine

Roadmap to fully harvest eRx opportunity

• 1. Launch eRx marketplace app
• 1. Become first mover in the eRx opportunity 2020/2021:

a. Test & learn in §140 SGB V contracts for special care provision

• b. Scaling via digital prescription service of TeleClinic
• c. Full roll-out once reimbursement scheme is extended to "pre-Gematik" phase as specified by GSAV

Gematik framework (2022)

Pre-Gematik

(2020-2021)

• 1. Build on great starting position
• 1. OTC / Rx Switch on German >8 million customer base¹

Launch of eRx marketplace app in Q4 2020

• Launch of DocMorris branded eRx marketplace app on the basis of existing marketplace technology of the group on track for launch in Q4 2020
• Core functions will include full range of Rx, OTC and BPC product offering, pick-up and other delivery options
• Expanding customer journey from diagnosis to delivery via integration of TeleClinic telemedicine functionality

Integration & synergies

Integration & synergies

Zur Rose Group integration strategy & roadmap – a combination of four pillars

Brands

Target picture One brand

Target 2020 Finalise branding strategy Organisation / Culture

Target picture

One Organisation Shared DNA and vision

Target 2020

Streamline organisational structure in Germany Expansion of management team (completed)

IT Platform

Target picture One unified platform

Target 2020 Launch eRx marketplace in

Germany

Logistics

Alternative wording for Logistic target picture: Efficient and customer centric logistic strategy

Target picture Efficient and customer centric logistic strategy

Target 2020 Expansion of existing Heerlen site

Zur Rose Group

Integration and synergies

Integration roadmap 2020 – bundeling of service functions, remaining sites as operational hubs

• Vitalsana will be fully merged with DocMorris and the Vitalsana site will be closed down
• Marketing and customer service departments of Eurapon will be pooled at the Heerlen site
• Marketing tasks performed by Zur Rose DE will be transferred to Heerlen and Mannheim

Integration and synergies

medpex example shows leading know-how in German OTC market

• medpex operating best-in-class
• Leadership team now fully in charge for German OTC business
• Realisation of synergies started in H1 with a focus on profitable revenue growth

Outlook

Outlook

Group Outlook 2020

The latest acquisitions strengthen the market position of the Zur Rose Group. Taking into account the revenues of medpex, Apotal and TeleClinic, management expects growth of over 10 percent for the full year 2020.

Before expenses for additional growth initiatives, especially in the area of electronic prescriptions and for European opportunities, the company aims to break even at adj. EBITDA level in 2020.

Outlook

Mid-term targets

The Group expects growth in the Rx business to accelerate significantly from next year and confirms its medium-term sales expectation of over CHF 3 billion. The medium-term EBITDA target margin, adjusted for growth initiatives, is around 8 percent.

The mandatory introduction of electronic prescriptions from 2022 and the implementation of the healthcare ecosystem offer further relevant sales and earnings potential.

Zur Rose Group Rose

Contact Information

Walter Oberhänsli Founder, Group CEO

ir@zurrose.com +41 58 810 11 49 Marcel Ziwica Group CFO

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.

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