PharmaSGP : Interim Statement Q3 2024

Published: 2024-11-28 01:58:04 ET PSG.DE

Interim Statement Q3 2024

PharmaSGP at a Glance

PharmaSGP is a consumer health company with a diversified portfolio of leading over-the-counter (OTC) pharmaceuticals and other healthcare products.

PharmaSGP's OTC products cover highly relevant and chronic indications. In a structurally growing market, it has thereby been able to establish market-leading positions in many important areas, such as rheumatic and neuralgic pain, sleep disorders or men's and women's health. In Germany for example, PharmaSGP is the market leader for systemic chemical -free OTC pain remedies with its brand families RubaXX® for rheumatic pain and Restaxil® for neuralgic pain (nerve pain).

With the acquisition of the established OTC brands Baldriparan®, Formigran®, Spalt® and Kamol® in Sep- tember 2021, PharmaSGP has expanded its portfolio through further market leaders in their categories. For example, Baldriparan® is the No. 1 herbal sleep aid in pharmacies, and Formigran® is the leading OTC pharmaceutical against migraine.

Over the past eleven years, PharmaSGP has created a platform to successfully integrate and grow brands in all its European markets. Five key factors are the basis for the ongoing success:

In order to focus on its success drivers, PharmaSGP has deliberately established a scalable, asset-light business model which can also be transferred quickly and efficiently to other target markets. The entire manufacturing process is handled by a diversified network of third-party manufacturers in Eu- rope. In Germany and in foreign markets, individual local logistics providers supply wholesalers and to a lesser extent pharmacies directly. Combined with many years of experience of approval processes for new OTC pharmaceuticals in Germany and abroad, as well as regulatory requirements for other health- care products, PharmaSGP's platform allows it to quickly and efficiently establish and grow both new and existing brands and to establish its business model in other countries with little investment. PharmaSGP's products are marketed directly to their target group, especially senior citizens, under well-known pharmaceutical brands via a specialized D2C marketing strategy with a wide target group media reach and efficient commercial media condi- tions.

Since the launch of the first product from the current product portfolio in 2012, PharmaSGP has successfully transferred its business model to Austria, Italy, Belgium, France and Spain. Since September 2021, the Group has expanded its operations to Switzerland and Eastern European EU countries.

Overview of Performance Indicators

Revenues

in € thousand

+17.0 %

88,576

75,675

9M 2023

9M 2024

Adjusted EBITDA

in € thousand

32.7 %

30.5 %

24,717

+9.4 %

27,030

9M 2023

9M 2024

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

PharmaSGP on the Capital Market

In the twelve-month period from November 2023 to October 2024, the PharmaSGP share started at a price of

Share Price*

130

125

120

115

110

105

100

2023

2024

PharmaSGP

Euro Stoxx Total Market Pharmaceuticals & Biotechnology

*based on Xetra closing prices of Deutsche Börse AG 1 November 2023 = 100

Master Data of the Share*

Security Identification Number (WKN)

ISIN

Ticker symbol

Type of shares

Initial listing

Number of shares

Closing price* (31 October 2024)

High / low*

Market capitalization (31 October 2024)

Stock exchange / segment

Designated sponsor

A2P4LJ

DE000A2P4LJ5

PSG

Ordinary bearer shares with no par value (no-par value shares)

19 June 2020

12.0 million

€ 24.60

€ 26.00 / € 18.10

€ 295.2 million

Frankfurt Stock Exchange / Prime Standard

Joh. Berenberg, Gossler & Co. KG

* based on Xetra closing prices of Deutsche Börse AG, relating to the period from November 2023 to October 2024

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

Shareholder Structure

Information based on the voting rights notifications received pursuant to the German Securities Trading Act, WpHG and other disclosed information (as of November 2024)

4.8 %

5.4 %

4.1 %

FUTRUE GmbH / MVH Beteiligungs- und Beratungs-GmbH*

Union Investment Privatfonds GmbH

PharmaSGP Holding SE (treasury shares)

Free ﬂoat

85.7 %

* Based on a voting agreement between FUTURE GmbH and MVH Beteiligungs- und Beratungs-GmbH, there is a mutual attribution of voting rights between FUTURE GmbH and MVH Beteiligungs- und Beratungs-GmbH with regard to all shares held by them in Pharma SGP Holding SE.

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

Economic Report

Course of Business of PharmaSGP

The recession in the manufacturing industry, continuing consumer restraint and uncertain investment conditions are responsible for the continued economic stagnation in Germany, PharmaSGP's core market. As a result, the already weak economy in Germany failed to return to a growth trajectory in the first nine months of the year.1 The Kiel Institute for the Global Economy's (IfW) projections for gross domestic product (GDP) in the third quarter of 2024 show a decline of 0.1 % compared to the previous quarter. GDP in Germany already fell by 0.1 % quarter-on-quarter in the second quarter, while it had risen slightly by 0.2 % in the first quarter of 2024.2

In view of the stagnating economy, economic researchers expect GDP to fall by 0.1 % for the full year 2024 in their autumn forecast, following a growth forecast of 0.2 % in the summer. The forecast for the following year was also revised downwards by the IfW, with overall economic production in Germany expected to grow by only 0.5 % in 2025 (June 2024 forecast: 1.1 %).3 For the Eurozone, the Kiel-based

economic researchersexpect slight economic growth of 0.9 % in 2024, followed by a slightly stronger increase of 1.2 % in 2025.4

outside Germany by 43.4 %. For the full Group, PharmaSGP achieved revenues of € 88,576 thousand in the nine-months period 2024, which corresponds to an increase of 17.0 % compared to the prior-year peri- od. Due to that development, the Management Board has raised its revenue forecast for the financial year 2024 and now expects revenues in the range of € 112.0 million to € 117.0 million. With regard to adjusted EBITDA, the Management Board continues to expect a figure between € 35.0 million and € 38.0 mil- lion. This corresponds to an adjusted EBITDA margin of 31.3 % to 32.5 %.

On 12 September 2024, the Management Board of PharmaSGP Holding SE resolved with the approval of the Supervisory Board to buy back up to 594,405 shares of the Company by way of a public share repurchase offer. Until the expiration of the acceptance pe- riod, a total of 477,701 shares were offered for repur- chase. The credit to the shareholders totaling € 10,247 thousand was issued in October 2024. The entire transaction will therefore not take effect until the fourth quarter of 2024 and is not recognized as a business transaction in this quarterly statement.

Revenues Development

Global drivers such as rising life expectancy and increasing health awareness are ensuring a compa ratively non-cyclical growth for companies in the

pharmaceuticaland healthcare market worldwide. These positive conditions are also reflected in the outlook for the OTC market. From 2024 to 2029, an annual growth in revenues of 3.0 % is expected in Germa- ny5 and 4.0 % in Europe.6

In the first nine months of 2024, the German OTC market has increased by 6.4 %.7 In this context, also PharmaSGP could expand its revenue base. In Germa- ny, PharmaSGP's revenues have increased by 7.5 %,

in € thousand

+17.0 %

88,576

75,675

9M 2023

9M 2024

1 Institut für Weltwirtschaft (2024), Kieler Konjunkturberichte, Deutsche Wirtschaft im Herbst 2024, p. 3

2 Ibid, p. 4

3 Ibid, p. 3

4 Institute für Global Economy (2024), Kieler Konjunkturberichte, Deutsche Wirtschaft im Herbst 2024, p. 22

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

Revenues by Region

Other European countries

4 %

Austria

10 %

9M 2023

Italy

13 %

Germany

73 %

Other European countries

4 %

Austria

10 %

Italy

9M 2024

19 %

Germany

67 %

Revenues by Category in € thousand

+17.7 %

85,595

72,727

-0.7 %

2,921

2,902

Health Brands

Beauty Brands

9M 2023

9M 2024

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

Revenues Health Brands

in € thousand

+9.4 %

67,897

62,040

+65.6 %

17,698

10,687

DACH

Other European

Countries

9M 2023

9M 2024

Revenues Beauty Brands

in € thousand

-10.4 %

The DACH region recorded a decrease in

revenues, which was almost offset by growth

1,818

1,629

+15.4 %

in other European countries.

1,273

1,103

DACH

Other European

Countries

9M 2023

9M 2024

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

Earnings Development

Asset Position

In the first nine months of 2024, PharmaSGP achieved an adjusted EBITDA of € 27,030 thousand, which corresponds to a margin of 30.5 %. Compared to the prior year period, adjusted EBITDA has improved by € 2,313 thousand or 9.4 %. The adjusted EBITDA margin has decreased by 2.2 percentage points.

Assets in € thousand

131,299129,516

68,48262,064

in € thousand

adjusted EBITDA

adjusted EBITDA margin

One-time effects

unadjusted EBITDA

unadjusted EBITDA margin

9M 2024

9M 2023

27,030

24,717

30.5 %

32.7 %

125 - 40

26,905 24,757

30.4 %

32.7 %

Change

9.4 %

8.7 %

22,051 29,685

40,76637,767

31 December 2023 30 September 2024

Non-current assets

While personnel expenses and expenses for raw

materials, consumables and finished goods increased only moderately, there were cost increases in marketing and other operating expenses in the first nine months of 2024 due to investments in distribution channels and recruiting costs. These cost increases were only partially offset by the fixed cost degression in personnel expenses and the improvement in the COGS quota, with the result that adjusted EBITDA as a percentage of revenues decreased from 32.7 % in the first nine months of 2023 to 30.5 % in the current reporting period.

In the first nine months of 2024, one-time costs and special effects mainly comprise expenses for the long- term compensation of the Management Board and other, one-time, non-recurring and non-operative expenses.

Other current assets

Cash and cash equivalents

Since last year's balance sheet date, non-currentassets have decrease by € 6,418 thousand or 9.4 % to

In the nine-month period 2024, cash and cash equivalents have decreased by € 2,999 thousand or 7.4 %. Major drivers were - amongst others - the dividend payment of € 16,307 thousand and the redemption of the syndicate financing of € 4,000 thousand. This is offset by cash inflows from operating activities of

The increase in other current assets of € 7,634 thousand results mainly from an increase in trade and other receivables as a result of the revenue increase; as of 30 September 2024, trade and other receivables amount to € 15,971 thousand.

PharmaSGP on the Capital Market | Economic Report | Condensed Interim Cosolidated Financial Statements

Equity and liabilities in € thousand

131,299129,516

24,59429,782

66,95162,786

39,754

36,948

31 December 2023

30 September 2024

Current liabilities

Non-current liabilities

Equity

Since the last balance sheet date, the equity position has decreased by 7.1 % to € 36,948 thousand as of 30 September 2024. This change results from the profit of the period of € 14,050 thousand, from the dividend payment of € 16,307 thousand, and from the measurement of interest rate hedges; the negative change in value of € 549 thousand of the interest rate hedges is recognized in equity.

The repurchase of 477,701 shares, resolved on 12 September 2024, will become effective in the fourth quarter of 2024; it will then result in a further decrease in equity of € 10,247 thousand.

Due to the scheduled redemptions for financial and lease liabilities, non-currentliabilities have decreased to € 62,786 thousand as of 30 September 2024.

Current liabilities amount to € 29,782 thousand as of 30 September 2024. The increase of € 5,188 thousand or 21.1 % compared to the last balance sheet date mainly stems from higher trade payables and income tax liabilities.

Financial Position

in € thousand

9M 2024

9M 2023

Net cash flows from operating

activities

20,913

17,412

Net cash flows used in investing

activities

- 1,327

- 645

Net cash flows used in financing

activities

- 22,585

- 12,813

Net increase (decrease) in cash

and cash equivalents

- 2,999

3,954

Cash and cash equivalents as of 1

January

40,766

32,642

Cash and cash equivalents as of

37,767

30 September

36,596

Compared to the prior year period, cash flows from operating activities have increased by 20.1 %. The increase stems from the operating result (unadjust- ed EBITDA +8.7 %) and the increase in income tax liabilities.

Cash flows used in investing activities were mainly incurred for PharmaSGP's marketing authorizations and qualification of contract manufacturers.

A total of € 22,585 thousand was spent on financing activities in the first nine months of 2024. This amount includes the dividend payment of € 16,307 thousand as resolved by the Annual General Meeting on 26 June 2024, redemption of financial liabilities and lease liabilities of € 4,355 thousand as well as interest payments for leases and the syndicate financing of € 2,955 thousand. PharmaSGP received in the first nine months of 2024 € 1,061 from interest rate hedges.

Disclaimer

PharmaSGP Holding SE published this content on November 28, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on November 28, 2024 at 06:57:17.706.