#1J Sequent Proven Ability In Life Sciences ALIVIRA | I Earnings Presentation Q4 & FY23 24th May 2023 I#2Disclaimer 2 J Sequent Proven Ability In Life Sciences ALIVIRA Except for the historical information contained herein, statements in this presentation and the subsequent discussions, which include words or phrases such as "will", "aim", "will likely result", "would", "believe", "may", "expect", "will continue", "anticipate", "estimate", "intend", "plan", "contemplate", seek to", "future", "objective", "goal", "likely", "project", "should", "potential", "will pursue", and similar expressions of such expressions may constitute "forward-looking statements". These forward looking statements involve al number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement our strategy, our growth and expansion plans, obtain regulatory approvals, our provisioning policies, technological changes, investment and business income, cash flow projections, our exposure to market risks as well as other risks. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date thereof. 2#3Sequent announces Q4 FY 23 results. Company to restructure European operations J Sequent Proven Ability In Life Sciences ALIVIRA In Q4 FY23, we have continued to make structural adjustments, so that we are present and ready to win in the most attractive markets and customer segments. Our recent actions are showing results. Despite the headwinds in some markets, the overall formulation business has grown at 9.9% on CC basis for the full year. While the devastating earthquake in Turkey did not damage our facilities, it has impacted the demand in the Turkey market since the clinic and distribution infrastructure is yet to be restored. In continuation with our strategy to improve profitability, the manufacturing operations in our plant in Germany have been discontinued and will move to alternative low cost sites. We expect to see the benefit in the coming quarters. While the overall market for Vet APIs was subdued in Q4 FY 23, we continue to receive over 70% of our API revenues from customers in regulated markets and anticipate a gradual pickup in the coming quarters. The focus remains on deepening our engagement with top animal health companies worldwide. During the year FY 23, we accelerated our filings, registering 5 VMFS and 3 CEPS Our API business has started a significant initiative to improve long term competitiveness. We have invested in additional capacity for new business and expanded our R&D team to meet the requirements of new partnerships with leading Animal Health companies. The results of the quarter reflect a one time charge on the closure of manufacturing in Germany and the impact of recent events on Turkey. This sets up the company for stronger, sustained growth and profitability. Rajaram Narayanan, Managing Director 3#4FY 23 : Overall growth of 2% in a challenging year GIF-10% اشا ~10% cc growth for Formulations. Business restructuring in Europe Emerging Markets delivered robust growth of 16% cc, driving overall Formulations J Sequent Proven Ability In Life Sciences Subdued sales of APIs Mahad site awarded the EcoVadis Sustainability Silver Medal Ni JAPI API: Focus on Top 10 AH customers. Regulated markets contribute to 72% of sales § ALIVIRA New comprehensive cost reduction and process efficiency improvement program APIS - Accelerating new product pipeline : 8 new filings (5 USVMF + 3 CEPS 4#5Revenue performance by Geography J Sequent Proven Ability In Life Sciences ALIVIRA All values in Mn QoQ Gr% YoY Gr% YoY Gr% Revenue Distribution Q4 FY23 Q3 FY23 QoQ Gr% Q4 FY22 YoY Gr% FY23 FY22 YoY Gr% (In cc) (In cc) (In cc) Formulations 2,559 2,588 (1.1%) (6.3%) 2,493 2.6% 2.9% 10,009 9,686 3.3% 9.9% Europe 1,146 1,050 9.1% 4.1% 1,024 11.9% 7.0% 4,147 4,205 (1.4%) 1.7% Emerging Markets 1,201 1,252 (4.1%) India 213 286 (25.7%) APIs 941 1,072 Other Sales 10 25 Global Sales 3,511 Adjustment* - Ind AS 29 156 Reported Sales 3,685 69 (12.1%) NM (4.7%) (10.5%) 1,253 (4.1%) (25.7%) 217 (12.2%) 1,273 NM 70 (8.4%) 3,837 (0.8%) (2.0%) (2.0%) 1,055 (26.1%) (31.8%) 3,808 NM NM ☐☐ 102 (8.5%) (10.2%) 13,920 14,128 4,807 4,461 7.8% 15.9% 1,021 3.4% 3.4% 4,314 (11.7%) (15.4%) 128 NM (1.5%) NM 2.2% 289 3,667 3,753 (2.3%) (8.0%) 3,837 (4.4%) (9.9%) 14,209 14,128 0.6% 2.2% Following strong growth in Q3, Q4 revenue was lower by 8% cc vs. Q3 FY23. Despite multiple headwinds across geographies, in FY23, recorded a growth of 2.2% y-o-y in cc terms Formulations Business :- Europe clocked 7% yoy growth in Q4. FY23 was relatively flat with growth of 1.7% over FY22. Implemented strategic initiatives to streamline operations and optimize cost structures. Emerging Markets segment continues its growth trajectory despite a muted LATAM sales during Q4 FY 23. In FY23, the region delivered a robust 15.9% cc growth despite major headwinds in Turkey. API business: Top 10 customers continue to contribute ~58% of sales. Comprehensive margin and operations improvement program underway. New investment in capacity expansion and R&D capability - cc Constant Currency *Adjustment on account of hyperinflation in Turkey as per Ind AS 29 _ NM Not Material 5#6Formulations : Sustaining growth momentum. Key Updates EUROPE- Return to growth with launch of new Phyto range. Structural adjustments to improve margins Manufacturing in Germany discontinued and operations to shift to alternative low cost locations. Margin accretive from Q3 FY 24 EMERGING MARKETS - Nourrie integration completed in Brazil. New platform created for companion animals. Turkey business impacted by inflationary pressures and the recent earthquake. INDIA- Cattle business continues to grow by ~10% despite challenges in rural markets. Expansion of team for accelerated growth in FY 24 1,878 6,789 2,451 Revenues 14% 9,686 8,824 2,494 J Sequent Proven Ability In Life Sciences ALIVIRA FDFs 1000+ Manufacturing facilities 6 All values in * Mn R&D Centres 4 2,559 10,009 Q4 FY20 FY20 Q4 FY21 FY21 Q4 FY22 FY22 Q4 FY23 FY23 cc- Constant Currency Countries with marketing 80+ presence 6#7API: Continued strength in regulated markets Key Updates ❖ Pricing pressures and currency challenges in some markets had an adverse impact on demand Regulated markets contribute ~72% of the revenue * Strong portfolio- 8 fillings during the year. (5 USVMF + 3 CEPS) API business now has total 29 USVMFS + 18 CEPS New investment in capacity expansion for leading AH customers * R&D capacity expansion ✰ Comprehensive margin and operations improvement program (Project Pragati ) underway. Benefits to kick in from Q2 FY 24. 1,072 J Sequent Proven Ability In Life Sciences ALIVIRA Commercial APIs 30+ Manufacturing facilities 3 Revenues All values in * Mn 4,565 4,004 4,314 R&D Centre 1 1,118 1,273 941 3,808 Q4 FY20 FY20 Q4 FY21 FY21 Q4 FY22 FY22 Q4 FY23 FY23 Sales to Regulated Markets 70%+ 7#8I J Sequent Proven Ability In Life Sciences ALIVIRA | Financials#9Consolidated Financials J Sequent All values in Mn Proven Ability In Life Sciences ALIVIRA Q4 FY23 Particulars Unaudited Q3 FY23 Unaudited Q4 FY22 Unaudited FY23 Audited FY22 Audited Revenue from Operations 3,667 3,753 3,837 14,209 14,128 Material Consumption (2,217) (2,174) (2,188) (8,338) (7,930) Gross Margin 1,449 1,579 1,649 5,871 6,198 % 39.5% 42.1% 43.0% 41.3% 43.9% Employee Benefit Expenses (570) (580) (519) (2,230) (1,985) Impact on gross Operating Expenses (751) (722) (744) (2,886) (2,791) EBITDA (pre ESOP) 128 277 386 756 1,423 % 3.5% 7.4% 10.1% 5.3% 10.1% margin due to reduction in Inventory ESOP cost (76) (89) (53) (354) (329) OPEX controlled EBITDA 52 188 333 402 1,094 % 1.4% 5.0% 8.7% 2.8% 7.7% Exceptional Items / Acquisition cost* (616) (10) (658) IndAS 29 Adjustment (56) (28) (158) Exchange Gain / (Loss) (30) (46) 23 (114) 63 Other Income 17 29 15 64 45 Finance Cost Depreciation (109) (97) (60) (355) (158) (147) (137) (125) (557) (515) despite inflationary pressure Exceptional items driven by closure of plant in Germany and impact of recent events in Turkey Taxes Earnings Before Tax Earnings After Tax Minority Interest Earnings after Minority Interest (888) (102) 186 (1,377) 529 (36) 4 (86) 157 (83) (924) (98) 100 (1,220) 446 11 (9) 11 (8) 38 (936) (89) 90 (1,212) 408 * Q3 FY23 10 Mn acquisition related cost 6#10Adjusted EBITDA at 110 crs Particulars Revenue EBITDA (Pre ESOP) One offs Improvement in Inventory days FY23 14,209 756 102 60 60 Business restructuring 29 Turkey earthquake impact 13 Hyper inflation 28 Discontinued Operations in Germany 217 Adjusted EBITDA 1103 Amt in Rs Mn J Sequent Proven Ability In Life Sciences ALIVIRA 10#11Key Balance sheet Items All values in Mn Particulars Mar-23* Dec-22* Mar-22" Shareholders Funds 6,981 7,715 6,919 Minority Interest 500 482 480 Net Debt 3,561 3,631 2,542 Investments 0 0 368 Tangible Assets 3,622 3,780 3,263 Intangible Assets 3,085 3,186 2,498 Working Capital 4,261 4,804 4,222 Put/Buyout Liabilities ^159 J Sequent Proven Ability In Life Sciences ALIVIRA Balance Sheet Highlights ❖ Operational initiatives - working capital days reduced by 11 days ❖ Net Debt is marginally down *Mar'23 & Dec'22 reported numbers are adjusted for impact of hyperinflation accounting in Turkey as per IndAS 29 - 'Accounting for Hyperinflationary economies' ^ Buyout Liabilities of 159 Mn in Mar'22 paid on account of Nourrie acquisition `Mar'22 restated on account of Nourrie amalgamation 11#12Krunal Shah Company Secretary +91 22 4111 4779 [email protected] For details, feel free to contact: Abhishek Singhal Investor Relations Consultant [email protected] J Sequent Proven Ability In Life Sciences ALIVIRA Nachiket Kale Investor Relations Advisor +91 9920940808 [email protected] Registered Office: 301/A, 'Dosti Pinnacle', Plot No. E7, Road No. 22, Wagle Industrial Area, Thane (W), Maharashtra, India Websites: www.sequent.in, www.alivira.co | CIN: L99999MH1985PLC036685 | BSE Code: 512529 | NSE: SEQUENT | ISIN: INE807F01027 Certain statements in this document that are not historical facts are forward looking statements. Such forward-looking statements are subject to certain risks and uncertainties like government actions, local, political or economic developments, technological risks, and many other factors that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. SeQuent Scientific Ltd. will not be in any way responsible for any action taken based on such statements and undertakes no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances. 12#13I J Sequent Proven Ability In Life Sciences ALIVIRA | Thank You