Richter Group13H1

Richter Group

Interim Report, 13H1 1 August 2013

Summary – 2013 H113H1

Summary 2013 H1

Consolidated sales: + 6.9% (EUR), + 7.1% (HUF)− good growth in China in EU15 countries and in Ukrainegood growth in China, in EU15 countries and in Ukraine− price erosion

Profit for the period*: +1.3% (EUR), +1.6% (HUF)+ increasing gross profit− higher level of S&M expensesg p

*Net income attributable to owners of the parent

22

Consolidated financial highlights13H1

Consolidated financial highlights

HUF Change EUR Changeg g

Total revenues 177.9 bn 7.1% 601.1 m 6.9%

Profit from operations 30.0 bn 4.2% 101.3 m 3.9%

Profit for the period* 28 6 bn 1 6% 96 5 m 1 3%Profit for the period 28.6 bn 1.6% 96.5 m 1.3%

EPS (diluted) 1,532 1.6% 5.18 1.3%

*Net income attributable to owners of the parent

3

Geographical composition of Group sales13H1

Geographical composition of Group sales

10%

7%

Hungary

RussiaPoland

10%6%

Hungary

Russia Poland7%

12%

31%

Romania2012 H1

2013 H1

6%29%

12% Romania

8 %

5 %

10%

7%

%

EU9Ukraine

H1 H1

6 % 7%

8 % 10%3%

EU9

Oth CIS

Ukraine

1%4% EU15USA

Other CIS 5%

RoW

4% 5%

China

3% EU15USA

Other CIS

RoW

1%

China

Total: HUF 166.0bnEUR 562.4m

Total: HUF 177.9bnEUR 601.1m

7.1% HUF6.9% EUR+

44

P&L13H1

P&L

HUFmH1 2013

Change %

EURmH1 2013

Change %

as % of total revenues

Total revenues 177,877 7.1 601.1 6.9

Gross profit 113,695 10.0 384.2 9.8 63.9

S&M expenses (55,468) 19.4 (187.4) 19.1 31.2

A&G expenses (9,618) -11.3 (32.5) -11.4 5.4

R&D expenses (20,769) 3.7 (70.2) 3.5 11.7

Other income and other expenses 2,120 -23.1 7.2 -23.4 1.2

Profit from operations 29,960 4.2 101.3 3.9 16.8

Net financial income 451 -39.3 1.5 -40.0 0.3

Profit for the period* 28,557 1.6 96.5 1.3 16.1

*Profit attributable to owners of the parent

5

Increasing gross profit and gross margin13H1

Increasing gross profit and gross margin

+ higher than average increase of turnover in China, in Ukraine, in EU15 countries and in other CIS 63.9%

HUF

60%

62%

64%

200000

250000region

+ increasing share of

62.2%HUFm

52%

54%

56%

58%

50000

100000

150000g

own-developed products

decline in the high margin US48%

50%

0

50000

2006 2007 2008 2009 2010 2011 2012 12H1 13H1

- decline in the high margin US business

Gross profit Gross margin

6

Slight decline of operating margin13H1

Slight decline of operating margin

Sales and marketing expensesSales and marketing expenses− expanding sales network in

Western Europe− Esmya® launches HUFm

15,0%

20,0%

25,0%

40000

50000

60000

70000y

− S&M activities in China

Research and development 17.3% 16.8%

5,0%

10,0%

15,0%

10000

20000

30000

40000p

expenses− Forest, PregLem, biosimilar

research

0,0%0

10000

2006 2007 2008 2009 2010 2011 2012 12H1* 13H1

Profit from operation Operating margin

Amortisation− Esmya® + Grünenthal OCs

*Restated due to reclassification of innovation fee.

7

Pharmaceutical sales*13H1

Pharmaceutical sales

Key drivers of growth:

China, EU15 countries and Ukraine

Female healthcare

Successful product launches

*89% of turnover originates from outside of Hungary

8

g g y

8

Hungary13H1

Hungary

Turnover *Sales increase: 3.8% in HUF

HUFbn

30

40Successful product launches− Esmya®

10

20

02007 2008 2009 2010 2011 2012 12H1 13H1

*Turnover of the pharmaceutical segment

9

EU – composition of sales*13H1

EU composition of sales

Traditional EU member states 38%states− strengthening our position

in key Western-European markets

62%

markets− own gynaecological sales

and marketing network

Poland, Romania, EU9− well established in the region for

decades− own specialized sales network* Turnover of the pharmaceutical segment p

10

EU1513H1

EU15

120

Turnover*

10.1% (EUR) sales increase

R tl t bli h d S&MEURm

80

100

120Recently established S&M network

20

40

60

Female healthcare products: Richter OC portfolio, acquired OCs Esmya®

02007 2008 2009 2010 2011 2012 12H1 13H1

OCs, Esmya®

*Turnover of the pharmaceutical segment

11

Poland, Romania, EU913H1

Poland, Romania, EU9

M d t d li f t

Turnover*

Moderate decline of turnover

Unfavourable macroeconomic EURm

100

150

200environment

Poland:

0

50

100Poland: – sales decrease of 5.9% in PLN− expiry of Avonex licensing

agreement 2007 2008 2009 2010 2011 2012 12H1 13H1

Poland Romania EU9

agreement− adjusted sales with Avonex:

+5.7% in PLN

Romania:– flat sales levels

*Turnover of the pharmaceutical segment

– delays in payment12

CIS13H1

CIS

Turnover*

Slight sales increase (+3.9% EUR)

EURm

300

400

500Dynamic growth: Ukraine

100

200

300

Russia: expiry of Suprax licencing agreement

02007 2008 2009 2010 2011 2012 12H1 13H1

Russia Ukraine Other CIS

*Turnover of the pharmaceutical segment

13

Russia13H1

Russia

Sales increase (+2 4% RUB;

Turnover*

Sales increase (+2.4% RUB; +0.9% EUR)

EURm

300

400Expiry of Suprax licensing agreement(revenue loss: RUB 0.5 bn/

100

200(EUR 11.5 m)

Adjusted sales with Suprax0

2007 2008 2009 2010 2011 2012 12H1 13H1

Adjusted sales with Suprax(+9.7%RUB; +8.0%EUR)

Effective marketing activity

Increase of manufacturing and

*Turnover of the pharmaceutical segment

Increase of manufacturing and warehousing capacities

14

Ukraine, Other republics13H1

Ukraine, Other republics

Turnover*Ukraine

23 6% increase (USD)USDm

150

200− 23.6% increase (USD)− effective marketing activity

Oth bli50

100Other republics− 5.2% increase (USD)

02007 2008  2009 2010 2011 2012 12H1 13H1

Ukraine Kazakhstan Other CIS

*Turnover of the pharmaceutical segment

15

USA13H1

USA

Turnover*Revenue loss (-23.0% USD)

USDm

160

200

Significant proportion of gynaecology – 90%

40

80

120gy gy

Declining female healthcare l

02007 2008  2009 2010 2011 2012 12H1 13H1

sales

*Turnover of the pharmaceutical segment

16

China13H1

China

Dynamically expanding pharmaceutical market

From 2013 JV operates with Richter majority stake

Sales network: 200 medical representatives

S l i 2013 H1 EUR 24 9 illiSales in 2013 H1: EUR 24.9 million

Preshipments: EUR 9 5 millionPreshipments: EUR 9.5 million

17

Pharmaceutical sales by therapeutic areas13H1

Pharmaceutical sales by therapeutic areas

OtherCentral nervous

system

13%

6%

17%Muscle

relaxants

28%4%Gastrointestinal Cardiovascular2013 H1

32%Gynaecology

Total: EUR 525.9m

18

Female healthcare sales by region13H1

Female healthcare sales by region

806% CEE

Hungary

CIS

HUFbn

20

40

6013%31%

Ex-Grünenthal

0

20

28%

10%4%

8%

EU15

portfolio

China

Gynaecological sales Non‐gynaecological sales

USARoW

EU15

Total: HUF 49.0bnEUR 165.5m

1919

Sales network13H1

Sales network

1800

staff

1200

1400

1600

1800

600

800

1000

0

200

400

2005 2006 2007 2008 2009 2010 2011 2012 12H1 13H12005 2006 2007 2008 2009 2010 2011 2012 12H1 13H1

CIS CEE Hungary EU15 China

20

Wholesale and retail13H1

Wholesale and retail

W&R sales contributions is 15% of total sales

71% of the W&R turnover originates in Romania

2121

Ownership structure13H1

Ownership structure

30 June 2013

Domestic investors

International investors

65.98%

25 24%

8.78%

Hungarian State Holding Company

25.24%

2222

13H1

Thank you for your attention!y y

23

Appendix13H1

Appendix

Exchange rates

24

Evolution of currency exchange rates13H1

Evolution of currency exchange rates

HUF

300

330

270

300

210

240

EUR/HUF

USD/HUF

150

180

25

Exchange rates13H1

Exchange rates

At i d dAt period end30.06.2013 31.03.2013 31.12.2012 30.09.2012 30.06.2012

EUR/HUF 295 16 304 30 291 29 283 71 288 22EUR/HUF 295.16 304.30 291.29 283.71 288.22

USD/HUF 226.18 237.36 220.93 219.17 229.13

RUB/HUF 6.91 7.65 7.26 7.09 6.96

Average2013 H1 2013 Q1 2012 M12 2012 M9 2012 H1

EUR/HUF 295.9 296.1 289.1 291.3 295.2

USD/HUF 225.1 224.0 225.0 227.3 227.7

RUB/HUF 7.3 7.4 7.2 7.3 7.4

26