Wright Medical Investor Presentation - 11-2-2016
Wright Medical Investor Presentation - 11-2-2016
Wright Medical Investor Presentation - 11-2-2016
Investor Presentation
November 2, 2016
~$8B
Global
extremities/biologics
market
~2X
Wright Medical growth
rate vs. the market
#1
Wright Medical
position in
extremities
market
4
3% 7%
Biologics
21%
Legacy
Wright
2015 Sales
$332M
Upper Extremities
Lower Extremities
4%
12%
69%
Biologics
Pro Forma*
2015 Cont.
Ops. Sales
$615M
Other
5% 1%
13%
Upper Extremities
Lower Extremities
Biologics
Legacy
Tornier
Pro Forma*
2015 Cont.
Ops. Sales
$283M
41%
43%
81%
* Pro forma gives effect to the Wright/Tornier merger as if it had occurred on the first day of fiscal
2015. Pro forma adjustments include the reduction of Torniers sales to remove from Lower
Extremities revenue the U.S. sales associated with Torniers Salto Talaris and Salto XT ankle
replacement products and Torniers silastic toe replacement products, and adjustments within
Tornier product lines to conform product line revenue reporting. Additionally, as a result of the
divestiture of the large joints (hip/knee) business from Wright, this revenue is now reported as
discontinued operations.
Why invest in
Wright Medical?
Leader in
fastest growing
orthopaedic markets
Multiple growth
opportunities and
robust pipeline of
innovative products
Accelerated path to
profitability, stronger
financial profile
8
8%
to
10%
8%
to
7%
9%
5%
to
to
8%
6%
6%
3%
to
3%
4%
2%
to
3%
Lower
Upper
Biologics
Extremities Extremities
Sports
Medicine
Trauma
Knee
Spine
Source: 2014 iData Research Inc., 2013 Millennium Research Group, 2012 Life Science Intelligence, Management Estimates
Hip
9
Why invest in
Wright Medical?
Leader in
fastest growing
orthopaedic markets
Multiple growth
opportunities and
robust pipeline of
innovative products
Accelerated path to
profitability, stronger
financial profile
10
UPPER
EXTREMITIES
MARKET
LOWER
EXTREMITIES
MARKET
8 10%
CAGR
8 9%
CAGR
$2.7B
$3.7B
$1.7B
$2.8B
2014
2018
2014
2018
BIOLOGICS
MARKET
5 6%
CAGR
$1.1B
2014
$1.4B
2018
IN ROLLOUT
IN ROLLOUT
IN ROLLOUT
2016
2017
12
Simpliciti Shoulder:
a highlight of our upper extremities product pipeline
Provides clinical benefits,
simplifying surgery &
reducing variables
$200M-$250M
13
$75M-$90M
14
Plating
System
External Fixator
$60M-$80M
15
a game-changing biologic
BREAKTHROUGH BIOLOGIC
First and only proven alternative
to autograft for ankle and/or
hindfoot fusion
Demonstrates equivalent safety
& efficacy with less pain
Only synthetic growth factor to
market in last 10 years
PROVEN, UNIQUE,
LABELED AND SAFE
Recombinant human plateletderived growth factor (rh-PDGF)
stimulates bone formation
Provides a scaffold for new
bone growth
17
Augment
Injectable
Chronic
Tendinopathy
(Tennis Elbow)
Spine
ESTIMATED POTENTIAL MARKET:
Extremities-Biologics Company
TECHNOLOGY
LEADER
SPECIALIZED
SALESFORCES
GLOBAL
FOOTPRINT
Why invest in
Wright Medical?
Leader in
fastest growing
orthopaedic markets
Multiple growth
opportunities and
robust pipeline of
innovative products
Accelerated path to
profitability, stronger
financial profile
20
STEP
STEP
Sustain revenue
growth/ minimize
disruption
Leverage existing
resources
once integrated
Deliver cost
synergies of
~$40M to $45M
adjusted
EBITDA margins
in 3 to 4 years
~20%
21
Complementary businesses
Upper Extremities
percentage of revenue
81%
7%
Lower Extremities
percentage of revenue
Revenue
Dis-Synergies:
~$15M in 2016
incremental ~$10M
in 1H 2017
69%
13%
Based on 2015 YTD pro-forma revenue from continuing operations
22
Augment
infrastructure
International and
Back-Office
infrastructure
Manufacturing
capacity
Sales Organization
and Medical
Education
Inventory &
Instruments
23
Vendor consolidation
Process improvement
2016 anticipated
cost synergies of
~$25M
Anticipated
Year 3 Annual
Cost Synergies:
~$40M-$45M
24
2016 guidance
Net Sales
Adj. EBITDA
from Continuing
Operations(1)
from Continuing
Operations(1,2)
$677 million to
$683 million
$43 million to
$48 million
$
1 Guidance range communicated on 11/2/2016. The fact that we include these projections in this presentation should not be taken to mean that these amounts
continue to be our projections as of any subsequent date.
2 Adj. EBITDA from continuing operations, which is measured by adding back to net income/loss from continuing operations charges for interest, income taxes,
depreciation and amortization expenses, non-cash share-based compensation expense, and non-operating income and expense
25
+
3Q 2016
Non-GAAP
Results from
Continuing Ops.
GOALS
9%*
Mid teens
ADJ.
GROSS
MARGIN
78.2%
ADJ.
EBITDA
MARGIN
4%
SALES
GROWTH
Once Integrated
With Tornier
26
The New
Wright Medical.
A global leader on
an upward path.
POSITIONED TO OUTPERFORM
Merger creates premier
extremities/biologics company
Multiple growth drivers
Merger integration focused on
increasing business momentum
Accelerated path to profitability,
stronger financial profile
27
Julie Tracy
Chief Communications Officer
[email protected]
(901) 290-5817
www.wright.com NASDAQ: WMGI
28
Wright Medical
A global leader on an upward path
Investor Presentation
November 2, 2016