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TRANSCRIPT
2
2014 Analyst Meeting Forward Looking Statements
This presentation contains "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. Statements relating to guidance, plans,
prospects, goals, strategies, future actions, events or performance and other statements which are other than statements of historical fact, including our 2014 and
2015 guidance and all statements regarding anticipated growth in our revenue, anticipated effects of any product recalls, anticipated market conditions, planned
product launches and expected results of operations and integration of any acquisition are forward-looking. To identify these statements look for words like
"believes," "expects," "may," "will," "should," "could," "seeks," "intends," "plans," "estimates" or "anticipates" and similar words or phrases. Forward-looking
statements necessarily depend on assumptions, data or methods that may be incorrect or imprecise and are subject to risks and uncertainties.
Among the factors that could cause our actual results and future actions to differ materially from those described in forward-looking statements are: adverse changes
in the global or regional general business, political and economic conditions due to the current global economic downturn, including the impact of continuing
uncertainty and instability of certain European Union countries that could adversely affect our global markets; foreign currency exchange rate and interest rate
fluctuations including the risk of fluctuations in the value of the yen, British pound and euro that would decrease our revenues and earnings; acquisition- related
adverse effects including the failure to successfully obtain the anticipated revenues, margins and earnings benefits of acquisitions, including the Sauflon acquisition,
integration delays or costs and the requirement to record significant adjustments to the preliminary fair value of assets acquired and liabilities assumed within the
measurement period, required regulatory approvals for an acquisition not being obtained or being delayed or subject to conditions that are not anticipated, adverse
impacts of contingent liabilities or indemnification obligations, increased leverage and lack of access to available financing (including financing for the acquisition or
refinancing of debt owed by us on a timely basis and on reasonable terms); a major disruption in the operations of our manufacturing, research and development or
distribution facilities due to technological problems, natural disasters or other causes; disruptions in supplies of raw materials, particularly components used to
manufacture our silicone hydrogel lenses; limitations on sales following product introductions due to poor market acceptance; new competitors, product innovations
or technologies; reduced sales, loss of customers, and costs and expenses related to recalls; new U.S. and foreign government laws and regulations, and changes in
existing laws, regulations and enforcement guidance, which affect the medical device industry and the healthcare industry generally; failure to receive, or delays in
receiving, U.S. or foreign regulatory approvals for products; failure to obtain adequate coverage and reimbursement from third party payors for our products;
compliance costs and potential liability in connection with U.S. and foreign healthcare regulations, including product recalls, warning letters, and potential losses
resulting from sales of counterfeit and other infringing products; legal costs, insurance expenses, settlement costs and the risk of an adverse decision or settlement
related to product liability, patent protection or other litigation; changes in tax laws or their interpretation and changes in statutory tax rates; the requirement to
provide for a significant liability or to write off, or accelerate depreciation on, a significant asset, including goodwill; the success of our research and development
activities and other start-up projects; dilution to earnings per share from the Sauflon acquisition or other acquisitions or issuing stock; changes in accounting principles
or estimates; environmental risks and other events described in our Securities and Exchange Commission filings, including the "Business" and “Risk Factors” sections in
our Annual Report on Form 10-K for the fiscal year ended October 31, 2013, as such Risk Factors may be updated in quarterly filings.
We caution investors that forward-looking statements reflect our analysis only on their stated date. We disclaim any intent to update them except as required by law.
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2014 Analyst Meeting Management Introductions
Robert S. Weiss President & CEO The Cooper Companies
Daniel G. McBride, Esq. Executive Vice President, Chief Operating Officer & President of Cooper Vision, Inc.
Greg Matz Vice President & Chief Financial Officer The Cooper Companies
Carol R. Kaufman Executive Vice President, Secretary, Chief Administrative Officer & Chief Governance Officer The Cooper Companies
Albert G. White, III Vice President & Chief Strategy Officer The Cooper Companies
Fernando Torre Executive Vice President, Global Operations and Regulatory Affairs CooperVision, Inc.
Dennis Murphy Executive Vice President, Global Sales and Marketing CooperVision, Inc.
Paul L. Remmell President & CEO CooperSurgical, Inc.
Randal L. Golden General Counsel The Cooper Companies
2014 Analyst Meeting Agenda
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Time Topic Presenter
8:00 – 8:05 FLS & Agenda Kim Duncan
8:05 – 8:20 Introduction Bob Weiss
8:20 – 9:00 CooperVision Dan McBride
9:00 – 9:30 CooperVision Commercial Dennis Murphy
9:30 – 9:50 CooperVision Operations Fernando Torre
9:50 – 10:10 CooperVision Q&A
10:10 – 10:25 Break
10:25 – 10:55 CooperSurgical Review Paul Remmell
10:55 – 11:25 Financial Overview Greg Matz
11:25 – 11:35 Closing Remarks Al White
11:35 – 12:00 Q&A
2014 Analyst Meeting Company Overview
6 Source: Company reported data
Global Medical Device Company
Serving the specialty healthcare market through its business units: CooperVision (CVI)
and CooperSurgical (CSI)
NYSE: COO
HQ - Pleasanton, CA
~9,000 employees
FY13 Revenue: $1.6 billion
Investment Grade debt rating (S&P)
Keeping you at the forefront of women’s healthcareTM
7
2014 Analyst Meeting Our proven track record of success
What we told you in our
2010 IR Presentation What we delivered
Revenue growth exceeding the market Grew faster than the market in each
of the last 5 years
Maintain/expand gross margin Grew from 58% to 65%
Operating margin in the upper-teens Grew from 18% to 23%
Grow EPS faster than revenue Grew faster than revenue in each of
the last 5 years
Strong focus on free cash flow generation Generated more than $1.0B
cumulatively
Complete accretive acquisitions Closed ten acquisitions
2014 Analyst Meeting 5 Year Shareholder Value
8
Shareholder Return
Source: Yahoo Finance
0
100
200
300
400
COO ^GSPC (S&P 500)
9
Grow revenue faster than our
markets
Grow EPS faster than revenue
Generate over $1.3 billion in free cash flow
Expand CVI and CSI
geographically
Complete strategic
acquisitions
2014 Analyst Meeting Long Term Objectives (2014 – 2018)
2018E Operating
Margin of 26%+
11
Daniel G. McBride, Esq. Executive Vice President, Chief Operating Officer, The Cooper Companies; President, CooperVision
12
CooperVision (CVI) is committed to crafting world-class lenses by listening closely to the needs of eye care professionals and lens wearers
World’s third largest manufacturer of soft contact lenses
~8,000 employees with products sold in over 100 countries
Headquartered in Pleasanton, CA
Major manufacturing sites in UK, Puerto Rico, Hungary and U.S.
Major distribution centers in UK, U.S. and Belgium
2014 Analyst Meeting CooperVision – Overview
13
2014 Analyst Meeting Global Market Share
Soft Contact Lens Market by Competitor Q2 CY14A
Source: Management estimates and independent market research
J&J 41%
Ciba 26%
Cooper 21%
B&L 9%
Other 3%
14
2014 Analyst Meeting Above Market Growth
Soft Contact Lens Market vs. CooperVision Sales Growth
Note: TTM14 is trailing twelve months through June 2014 Source: Company reported data and independent market research
CooperVision has consistently out performed the market
6%
4% 5% 5%
6%
10%
7%
11% 12%
10%
0%
2%
4%
6%
8%
10%
12%
CY10 CY11 CY12 CY13 TTM14
Worldwide Soft Contact Lens Market CooperVision
16.5% 16.8% 17.8%
18.8%
20.6%
CY10 CY11 CY12 CY13 Q2 CY14*
15
2014 Analyst Meeting Market Share Gains
Increased Market Share
* Calendar Q2 CY14 Source: Management estimates and independent market research
Market share gain drivers:
Silicone hydrogel – Biofinity®, Proclear® 1-Day, MyDay®, and now clariti® Steady performance in hydrogel category
0
200
400
600
800
1,000
1,200
1,400
2005 2006 2007 2008 2009 2010 2011 2012 2013
Co
op
erV
isio
n R
even
ue
($ m
illio
ns)
2014 Analyst Meeting History of Top-Line Growth
16
2005– 2013 CAGR: 7.8%
CooperVision has grown over the years through a combination of: Introductions of new technologies Strategic acquisitions
17
2014 Analyst Meeting Market Share by Geography
Note: Soft contact lens market share Source: Management estimates and independent market research
Americas EMEA Asia Pacific
#3 in the Americas Strong SiHy base –
Biofinity® and Avaira®; MyDay® and clariti® FDA approved
~43% of CVI sales
#2 in EMEA Strong SiHy base –
Biofinity®, clariti®, Avaira® and MyDay®
~38% of CVI sales
#3 in Asia Pacific Under-indexed but
growing much faster than market in certain locations (e.g. China)
~19% of CVI sales
Cooper 12%
Cooper 22%
Cooper 30%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Americas $3,046
40%
Americas $4,189
42%
Asia Pacific $2,263
30%
Asia Pacific $2,823
28%
EMEA $2,251
30%
EMEA $2,948
30%
CY14E CY19E
18
CAGR CY14E to CY19E
U.S. dollars in millions
2014 Analyst Meeting
6%
5%
7%
6%
EMEA
Asia Pacific
Americas
Soft Contact Lens Market by Geography
Total Market
Estimated 5-Year Sales Trend Soft Contact Lens Market by Geography
Note: Estimates are based on manufacturers’ sales Source: Independent market research and management estimates
$7,560 $9,960
19
2014 Analyst Meeting Market Share By Category
Note: Soft contact lens market share Source: Management estimates and independent market research
#3 in sphere Under-indexed in
1-Day lenses ~57% of CVI sales
#1 in toric Strong SiHy and
hydrogel portfolio ~32% of CVI sales
#1 in multifocal Strong SiHy and
hydrogel portfolio ~11% of CVI sales
Sphere Toric Multifocal
Cooper 16% Cooper
32%
Cooper 39%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Sphere 74%
Sphere 71%
Multifocal 6%
Multifocal 7%
Toric 20%
Toric 22%
CY14E CY19E
U.S. dollars in millions
8%
10%
5%
20
Estimated 5-Year Sales Trend Soft Contact Lens Market by Category
CAGR CY14E to CY19E
2014 Analyst Meeting
6% Total Market
Soft Contact Lens Market by Category
Toric
Multifocal
Sphere
Note: Estimates are based on manufacturers’ sales Source: Independent market research and management estimates
$7,560 $9,960
21
#3 in 1-Day Well positioned for
growth with clariti®, MyDay® and Proclear® 1-Day
#3 in FRP Well positioned for
growth with market-leading SiHy platform including specialty lenses
1-Day Modality FRP Modality
Cooper 15%
Cooper 25%
2014 Analyst Meeting Market Share By Modality
Note: Includes Sauflon
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Frequent Replacement
58%
Frequent Replacement
50%
1-Day 42%
1-Day 50%
2014 Analyst Meeting
22
Growth in key categories; 1 Day modality leading growth
Estimated 5-Year Sales Trend Soft Contact Lens Market by Modality
CAGR CY14E to CY19E
U.S. dollars in millions
CY14E CY19E
$7,560 $9,960 6% Total Market
9%
3% Frequent Replacement
1-Day
Note: Estimates are based on manufacturers’ sales Source: Independent market research and management estimates
Soft Contact Lens Market by Modality
2014 Analyst Meeting
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Investing for future growth
Expanding CooperVision sites
Additional space to several key facilities
Additional production capacity
1-Day expansion and Biofinity® Growth
Adding New Sites
Costa Rica plant
Integrating Sauflon facilities
Scaling Capacity
Company description
Manufactures and distributes soft contact lenses and solutions, including a full suite of 1-Day silicone hydrogel products (sphere, toric and multifocal)
Product / geographic portfolio
Lead product: clariti® 1day (sphere, toric and multifocal)
– Received FDA clearance in August 2013; launched in the US in March 2014
Global presence with sales offices in over 10 countries and products sold in over 50 countries
Primary operations in UK and Hungary
2014 Analyst Meeting
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Sauflon Acquisition - Overview
Consistent with CooperVision’s strategy to expand presence in underpenetrated areas – 1-Day silicone hydrogel lenses
1-Day silicone hydrogel lenses account for approximately $400M of the global $3.1B 1-Day market
Significantly accelerates CooperVision’s 1-Day franchise
Enables a multi-tier 1-Day strategy with a full suite of silicone hydrogel and hydrogel lenses available in all product categories (sphere, toric and multifocal)
Provides opportunities for segmented value proposition
Halo effect – selling existing products into new accounts given demand for 1-Day silicone hydrogels
Capitalizes on CooperVision’s global footprint to aggressively roll out clariti® 1day
2014 Analyst Meeting
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Source: Management estimates
Sauflon Acquisition – Strategic Rationale
Sauflon has great momentum in 1-Day silicone hydrogel
Strong European presence and recent entry into the US
Proven technology with strong brand recognition
Once integrated into CooperVision, we expect to accelerate Sauflon’s growth
Ability to more aggressively roll out clariti® in the US and Asia Pacific utilizing existing infrastructure
Ability to support a more aggressive CapEx program to support multi-year growth
2014 Analyst Meeting
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Cooper and Sauflon – A Winning Combination
Thoughts from our first month
Integration planning
Facility visits
Product analysis
Synergy opportunities
Personnel decisions
Manufacturing
Solutions business
2014 Analyst Meeting
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Sauflon Acquisition
Everyone. Everyday.
People • Innovation • Product Portfolio • Customer Focus
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2014 Analyst Meeting
New Product Introductions
2008 2009 2010 2011 2012 2013 2014
Proclear® 1-Day Biofinity® Toric Avaira® Toric Biofinity® Multifocal
Proclear® 1-Day Multifocal
MyDay® Biofinity® Toric XR
Avaira® Sphere Private Label 1-
Day Silicone Hydrogel
Biofinity® XR
ClearSight® 1-Day Toric
clariti®
Continued growth through new technologies
Product Portfolio
2014 Analyst Meeting Core Silicone Hydrogel Products
29
Biofinity® and Avaira®
Superior, long-lasting comfort and vision performance
Biofinity® - Full suite of monthly lenses
Avaira® - 2-week disposable sphere and toric
MyDay®
CooperVision’s premium 1-Day product
Launched in Europe and select Asia Pacific Market
FDA approved in the U.S.
clariti®
Mass market 1-day portfolio with broad parameter range
Sphere, Toric and Multifocal 1-Day lenses
Launched in EMEA, U.S. and select Asia Pacific locations
2014 Analyst Meeting
30
Driven by comfort and convenience
New technology focused on bringing innovation to a wider contact lens audience
Enhancing the user experience
Focus on bringing new technology to current wearers that improves the contact lens experience – material, design, modality
Lengthening current use of contact lens wear
Continued focus on the multifocal market – has huge potential
New Technology and R&D
2014 Analyst Meeting
31
More than just selling a product
Comprehensive portfolio
Private label
Value Add Services – support customers and enhance user experience
Eye Care Prime/Websystem3™
LensFerry™
Private Label
Customer Partnership
2014 Analyst Meeting
32
Summary:
1 • Strong Historical Market Growth
2 • Well Positioned for Continued Growth
3 • Actively integrating Sauflon
4 • The Future Looks Bright
2014 Analyst Meeting Commercial Update
34
Source: Management estimates
• Today CooperVision (CVI) is no longer JUST a specialty lens company
• CVI is consistently dedicated to the clinician
• Dedicated to growing the category as a Multinational Corp. (MNC)
• Partner – Plans and Execution
• Quality of Thought, People, Actions, Anticipate
• Comprehensive product portfolio
• MNC – Luxottica, Grand Vision
• Regional Strategic Accts.
• MNC Corporate Accts.
35
2014 Analyst Meeting
Shifts in consumer and eye care professional (ECP) preferences
Practitioners are moving to 1-Day for health and lifestyle benefits
Patients are motivated by ECP influence, convenience and health benefits
New technologies bringing improved silicone and improved specialty lenses
The third generation of silicone hydrogel technology has cracked the performance formula – delivering high Dk/t, white eyes, and improved comfort and wearing
J&J, Alcon and CooperVision all bringing specialty lenses to market in their 1-Day portfolios
1-Day Segment driving patient and revenue growth
1-Day Segment – Overview
Growth
1-Day revenue growth 3-5x greater than frequent replacement (FRP) growth
Over the next 10 years 65-70% of new contact lens patients are expected to enter the 1-Day segment
1-Day revenue per patient 4-6x greater than an FRP patient
Opportunity
Expand 1-Day segment by accelerating patient migration to mass and premium sector of the segment
First mover advantage - surround the market with segment value proposition
36
Source: Management estimates and independent market research
1-Day Segment – Growth Opportunity 2014 Analyst Meeting
Globally, 1-Day represents ~41% of total soft contact lens market, and grew 10% TTM vs. FRP at 3%
Totaling ~$3.1 billion in revenue
Source: Management estimates and independent market research Note: Based on manufacturer sales
37
Americas $2,990M
1-Day 60%
FRP 40%
Asia Pacific $2,235M
1-Day 46%
FRP 54%
EMEA $2,180M
1-Day Segment by Geography 2014 Analyst Meeting
1-Day 25%
FRP 75%
1-Day continues to be the fastest growing modality
10% global growth in calendar 2012 and 2013; 2% growth in FRP during 2012 and 2013
– 25% growth in 2013 for 1-Day silicone hydrogel; anticipated to grow over 20% per year to 2018
Today only 13% of 1-Day sales are silicone versus 71% of FRP sales
Market Growth by Geography in Calendar 2013
38
1. SCL refers to Soft Contact Lenses Source: Management estimates
Fastest growing modality in the global SCL1 market
1-Day Growth 2014 Analyst Meeting
Annual patient value (manufacturer sales)
FRP Patient
Average 1-Day patient
SiHy 1-Day patient
39
Patient Revenue and Profitability
1-Day revenue per patient up to 4-6x greater than an FRP patient
2014 Analyst Meeting
40
2014 Analyst Meeting 1-Day SiHy Focus
CVI Today
CVI is the only manufacturer offering a full suite of 1-Day SiHy products
Sphere, toric, and multifocal – promotes a high level of practitioner
confidence in fitting “everyone”
Positioned with price and performance top of mind for both
practitioner and consumer
CVI Opportunities
2015 is the time for the U.S.
Europe continues it’s MyDay® launch, while also focusing on clariti®
Asia Pacific opportunities will develop with regulatory approval and
increases in manufacturing capacity
41
2014 Analyst Meeting 1-Day Segment
Source: Management estimates and independent research
Tipping point for silicone hydrogel (SiHy) success
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1-Day Sphere
Segment Value Proposition
from CooperVision®
Limited migration after 5+ yrs in SiHy Mass migration with accelerated growth in SiHy
100%
80%
60%
40%
20%
42
About 8 out of 10 patients are still in legacy products
RETAIL PRICE
LE
NS
PE
RF
OR
MA
NC
E
Mass Market
Economy
Premium
Opportunity
Gap
Opportunity
Gap
Hydrogel
Hydrogel Hydrogel
Hydrogel Hydrogel
Hydrogel Hydrogel
Hydrogel SiHy
SiHy
2014 Analyst Meeting 1-Day Landscape
1-Day Landscape — today
43
Leveraging our new 1-Day portfolio to help them adopt silicone hydrogel
Products to meet every wearer’s demands
Hydrogel Hydrogel
Hydrogel
Hydrogel Hydrogel
Hydrogel
RETAIL PRICE
LE
NS
PE
RF
OR
MA
NC
E
Mass Market
Economy
Premium
Hydrogel
SiHy
SiHy
2014 Analyst Meeting 1-Day Innovations
44
2014 Analyst Meeting
Advanced Innovation Smart Silicone chemistry
Affordable Innovation AquaGen Technology
Specs Measure
Dk/t 100
Water Content 54%
Modulus 0.4Mpa
UV Protection Yes
Specs Measure
Dk/t 86
Water Content 56%
Modulus 0.5Mpa
UV Protection Yes
Complete SiHy 1-Day portfolio
46
2014 Analyst Meeting 1-Day Focus
Source: Management estimates
Key 1-Day Takeaways
1. 1-Day is the fastest growing segment with 10% TTM YOY growth; strong
growth expected to continue
2. 1-Day market is ready for a mass silicone hydrogel migration – with the
right product performance and value
3. The comprehensiveness of a 1-Day portfolio matters to the ECPs and
consumers
2014 Analyst Meeting Unilateral Pricing Policy
47
Unilateral Pricing Policy (UPP) allows the manufacturer to establish the minimum retail price to the consumer
Potential Benefits
May protect ECP’s retail price point from discounters who do not invest in the clinical education and fitting process
Perceived by some ECPs that UPPs show the contact lens manufacturers are dedicated to the ECP
Potential Downsides/Challenges Enforcement can be challenging Consumer activism may generate legislative backlash and negative public
perceptions May alienate larger customers who want greater pricing freedom and cross
marketing
2014 Analyst Meeting Pricing Update
48
CooperVision’s strategy is about more than just price Only large U.S. manufacturer that doesn’t have UPP in place
Will consider if and when appropriate in the future
Continue to prioritize and support the ECP through: Price strategies Private labeling capability Channel management disciplines Value add portfolio Digital marketing programs Consistent market position
2014 Analyst Meeting The CVI Value Add Portfolio
49
EyeCare Prime™ Premier offers the full value add portfolio and more
2014 Analyst Meeting Value Add Portfolio
50
August 15, 2014 – Announced U.S. beta release of LensFerry™ as part of its EyeCare Prime suite of value-added services to ECPs
LensFerry™ is an e-commerce contact lens ordering solution branded to a practice E-commerce contact lens ordering solution branded to a practice
Helps ECPs level the contact lens ordering playing field Helps ECPs increase their contact lens revenues Helps build patient relationships and improves compliance Helps patient save time through online-ordering
Fernando Torre Executive Vice President, Global Operations and Regulatory Affairs CooperVision, Inc.
51
2014 Analyst Meeting Global Operations Sites
Juana Diaz, Puerto Rico
Rochester, NY
Liege, Belgium
Tokyo, Japan
Adelaide, Australia
Madrid, Spain
Milan, Italy
Ashford, England
Fareham, England
Southampton, England
Budapest, Hungary
Southampton, England
52
2014 Analyst Meeting
Hamble
Chandlers Ford
Ashford
Fareham
Juana Díaz
Scottsville Alajuela (Q4 2015)
United Kingdom Puerto Rico
Costa Rica New York
Budapest
Hungary
53
CooperVision Manufacturing Sites
2014 Analyst Meeting
Expansion of CooperVision sites Puerto Rico operations:
New warehouse and secondary packaging building Conversion of old warehouse and support areas to manufacturing areas Building expansion (additional 60,000 sq. ft. of manufacturing space)
UK operations: New manufacturing facility in Chandlers Ford (“Speedwell”)
Costa Rica New manufacturing facility – Phase 1 projected to start operation at the end of 2015
Integration/expansion of Sauflon’s manufacturing facilities Fareham Budapest Ashford
Additional production capacity concentrated on: MyDay® manufacturing ramp up Clariti® 1day Biofinity® Hydrogel One Day products
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Manufacturing Capacity Expansion
2014 Analyst Meeting
Production: Approx. 1 billion lenses per year Secondary Packaging: Over 640 million lenses per year Number of Employees: Approx. 1,600 employees Square Footage: 550,000 (once current expansions are completed)
55
Puerto Rico Manufacturing Operations
2014 Analyst Meeting Expansion of Puerto Rico Operations
New warehouse and
secondary packaging building
New clean room manufacturing areas in existing buildings
Phase G Expansion (60,000 sq. ft. of additional manufacturing space)
56
2014 Analyst Meeting Scottsville Manufacturing Operations
Focus: Lathed “Made to Order” or very low volume products Production: Over 10 million lenses per year Number of Employees: Approx. 460 Square Footage: 50,000
57
2014 Analyst Meeting UK Manufacturing – Original CVI Sites
Production: Over 600 million lenses per year Number of Employees: Approx. 1,800 Square Footage: Approx. 350,000 (after current expansion)
58
2014 Analyst Meeting UK Manufacturing – Fareham Operations
60
Production: Over 50 million lenses per year Number of Employees: Approx. 200 Square Footage: Approx. 22,000
2014 Analyst Meeting Budapest Manufacturing Operations
Production: Over 370 million lenses per year Number of Employees: Approx. 900 Square Footage: Approx. 142,000
61
Manufacturing site for Solutions Production: Over 30 million bottles per year Number of Employees: Approx. 170 Square Footage: Approx. 55,000
2014 Analyst Meeting UK Manufacturing – Ashford Operations
62
Being developed as a new high volume manufacturing facility to complement the existing manufacturing operations
Location: Coyol Free Trade Zone Industrial Park in Alajuela, Costa Rica
The facility will be gradually ramped up over a period of several years
Phase 1: Consists of a manufacturing building of approx. 100,000 sq. ft.
Phase 2: Adds an additional 100,000 sq. ft.
Space available for additional phases for a total of 400,000 sq. ft.
Project Status:
Building shell construction for Phase 1 is basically completed
Initiating work on building improvements
First production expected by the end of 2015
2014 Analyst Meeting Costa Rica Manufacturing Operations
63
Lot 53 (42,000 m2)
Abbott
Hologic Covidien
Volcano
St. Jude
Micro Vention
MOOG
Bean-One
Additional Space (46,000 m2)
2014 Analyst Meeting Costa Rica Manufacturing Operations
21.7 Acres
Facility location (Coyol Free Trade Zone Park, Alajuela, CR)
64
Delta Park West Henrietta
Tokyo
United Kingdom New York
Japan
Liege
Belgium
2014 Analyst Meeting CooperVision Distribution Operations
67
Sevington
2014 Analyst Meeting West Henrietta Distribution Operations
Distributes: Approx. 490 million lenses per year Secondary Packaging: Approx. 165 million lenses per year Number of Employees: 415 Square Footage: 282,000
68
2014 Analyst Meeting Delta Park Distribution Operations
Distributes: Approx. 730 million lenses per year Secondary Packaging: Approx. 660 million lenses per year Number of Employees: 340 Square Footage: 140,000
69
2014 Analyst Meeting Liege Distribution Operations
Distributes: Approx. 190 million lenses direct to customers in the core European markets (France, Germany, Benelux, Austria, Switzerland and Scandinavia) Number of Employees: 180 Square Footage: 124,000 70
2014 Analyst Meeting Japan Distribution Operations
Facility located in Tokyo Distributes: Over 500 million lenses per year Operated by: Nippon Express, a 3rd party logistics provider Square Footage: 34,500
71
2014 Analyst Meeting Sevington Distribution Operations
Distributes: Over 400 million lenses and 30 million solution bottles per year Secondary packaging operation Number of Employees: 200 Square Footage: 70,000
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0
400
800
1,200
1,600
2010 2011 2012 2013 2014*
Vo
lum
e o
f Le
nse
s (m
illio
ns)
* 2014 Forecasted manufacturing volume Source: Management estimates
+8%
+12%
Production levels increasing
+14%
+22%
+5%
2014 Analyst Meeting Manufacturing Volume Trend
73
* 2014 Forecasted manufacturing volume Source: Management estimates
Productivity per employee improving
2014 Analyst Meeting Manufacturing Productivity Trend
74
0
400
800
1,200
1,600
2,000
0
1,000
2,000
3,000
4,000
5,000
2010 2011 2012 2013 2014*
Vo
lum
e (m
illio
ns)
Hea
dco
un
t
Mfg. Volume Total Mfg. Headcount
2014 Analyst Meeting Key Operational Initiatives
Sauflon integration: We are evaluating manufacturing and distribution plans to maximize operational
capabilities over the coming years
Manufacturing capacity expansion: Complete expansion of existing manufacturing facilities Start up the new Costa Rica facility in 2015 Silicone Hydrogel 1-Day Capacity Ramp up
MyDay® Clariti® 1day
Continue investment in the development of advanced manufacturing processes and technology
Implementation of new systems and processes to increase the efficiency of our global supply chain and distribution operations
Continue the development of an operational culture based on continuous improvement: Lean manufacturing Six sigma
75
78
2014 Analyst Meeting CooperSurgical, Inc. – Agenda
• Brief overview of CooperSurgical
• Market / market focus
• Historical performance
• Growth drivers
• Future
CooperSurgical (CSI) is dedicated to providing medical devices and procedure solutions that improve the delivery of healthcare to women.
• Sells exclusively to medical professionals
• ~1,000 employees worldwide
• Headquartered in Trumbull, CT
• Core operations in U.S. and Denmark
79
2014 Analyst Meeting CooperSurgical Overview
80
Follow medical professionals
Ob/Gyn offices
Hospitals
Women’s health clinics
Labor and Delivery suites
Fertility centers
Sales Business Units
Direct sales unit – offices
Operating room unit – hospitals, surgical centers
International Business Unit
IVF Business Unit (Origio)
Corporate Accounts Business Unit
2014 Analyst Meeting CooperSurgical Overview
2014 Analyst Meeting
55% 57% 58% 59% 59% 60% 64% 65% 66% 64%
$101 $108 $124
$154 $167 $170 $188
$210
$256
$319
48%
53%
58%
63%
68%
$0
$80
$160
$240
$320
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Gro
ss M
argi
n P
erce
nta
ge
Co
op
erSu
rgic
al R
even
ue
(mill
ion
s)
Revenue Gross Margin %
Revenue and Gross Margin
2004– 2013 CAGR: 13.6%
81
82
2014 Analyst Meeting
88%
35%
69%
12%
65%
31%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Women's healthcare IVF Consolidated
Domestic International
Revenue
Source: Management estimates.
Pasadena, CA Charlottesville, VA
Mt. Laurel, NJ
Hilvarenbeek, The Netherlands
Ølstykke, Denmark
Måløv, Denmark*
* CSI Headquarters * ORIGIO Headquarters
Stafford, TX
Trumbull, CT*
83
Manufacturing Locations 2014 Analyst Meeting
2014 Analyst Meeting
CooperSurgical is a premier manufacturer of over 600 clinically relevant medical devices
Our market leading products are used by nearly all of women’s healthcare providers in clinics, operating rooms, labor and delivery suites, and reproductive (IVF) clinics worldwide
84
Product Offerings
Premier provider of women’s healthcare devices
Proven track record of successful M&A execution and integration
Completed over 30 acquisitions since inception in 1990
2014 Analyst Meeting Successful M&A Track Record
85
Successful M&A Track Record
86
Ob/Gyn visits are a significant segment of total patient visits
140 million Ob/Gyn patient visits annually (U.S. only)
Their complexity and variety requires a corporate partner with exceptional clinical expertise
CooperSurgical is that partner – we help manage this complex segment
Managing the challenging Ob/Gyn segment
Offering Exceptional Clinical Expertise 2014 Analyst Meeting
Our unique offering of 275 clinically-trained utilization specialists (IVF included) ensures products are optimally used for efficient care
Assurance of optimally managing women’s reproductive health – an important patient segment as women make most healthcare decisions for the family
Trusted Ob/Gyn products are the standard of care and used in most health-care facilities, bringing peace of mind to clinicians and administrators alike
87
Benefits of Working with CooperSurgical
Strategic Partnership 2014 Analyst Meeting
Surgery $1.6B
GYN Specific
, $1,000
General Use, $600
Obstetrics & Neonatal $510M
Office $1.7B
Total Estimated Market $4.310B
IVF $500M
Hospital, $2,110
IVF, $500
Office, $1,700
Source: Management estimates and independent market research
$80
$40
$150
$60
$120
$50
Needles &catheters
Sperm preparation
Media
Pipettes
Capital Equipment
Cryo/Vitrification
$270 $160
$80 Obstetrics
Neonatal
Breastfeeding
$400
$1,000
$50 $250
OfficeProcedures/Devices
Pharma Devices(IntrauterineSystems)
In-OfficeDiagnostic Testing
Cord Blood
88
Target Markets: Ob/GYN Specialty 2014 Analyst Meeting
Approx. market size – $1.7 billion
CooperSurgical currently participates in the office procedure space – approx. $400 million
Revenue in excess of $100 million
Market leader
Products used in everyday office visits
Primary products
General care
Cervical care
Family planning
Incontinence/ pelvic floor
Cryoablation
16,500 offices
Direct sales organization
68 FTE’s
89
Office Target Market 2014 Analyst Meeting
90
Currently undergoing a transition
Offices currently being acquired/consolidated
Physicians becoming employees
90
2000 2013 (projected)
2009 2005
57% 49%
43%
33%
1990
89%
Independent physicians as a percentage of total physicians
Source: Adapting to a new model of physician employment. Accenture. August, 2011
Office Market Dynamics 2014 Analyst Meeting
Consolidation means:
Office market currently in a state of transition
– Focus on acquiring
– Business as usual
– Transition to follow
Physicians transitioning from owner to employee
– Awaiting changes
– Everything on hold
– No decisions today
Procedure volume reported down
Effects from “Affordable Care Act”/Obamacare
Higher patient deductibles
Less discretionary dollars
Reimbursement
Continues to be an area of concern
91
Office Market Dynamics Continued 2014 Analyst Meeting
Slow to no procedure growth for the next few years, revenue to steady state thereafter – 3% to 5%
Consolidation to continue
Less call points
More sophisticated buyers
Demand more from vendors
– Smaller vendors unable to perform
Hospital associations taking control of purchasing
Standardization
Reliable vendors
Clinical support
Lower transaction costs
92
Our value proposition!
Office Market – Next 5 Years 2014 Analyst Meeting
Take advantage of our changing market place
Value proposition
Help standardization
Full clinical support
Meet needs of clinical buyer as well as economic buyer
Gain market share
Continue to promote the clinical value of our products
Become the choice for women’s healthcare
Transition sales organization towards National Account Management
Less focus on individual products
More focus on the CooperSurgical value proposition
Size the organization appropriately
93
Office Market Action Plan 2014 Analyst Meeting
Surgical target market is in excess of $2.0 billion
Revenue of $100 million
Made up of:
GYN-specific products
Specialty surgical instruments with crossover to general surgery
Current product line:
Sterilization products
Port-site closure products
Hysterectomy products
Laparoscopic instruments
Hybrid sales organization
65 FTE’s
63 Independent Representatives
Laparoscopic procedures growing 3% - 5%
Morcellation issues
Does not effect our product line directly
Endometrial ablation market continues to decline
Robot procedure volumes flatten
Value comes into question 94
Surgical Target Market 2014 Analyst Meeting
Drive market expansion
Port-site closure – 30% market penetration
Launch new products
4 new products currently in final stages of development
Market share gains
Expand product into distribution channel
Higher volume
Lower ASP
Fees
Look for specialty product acquisitions
Size and scale sales organization based on opportunities
95
Surgical Market Actions 2014 Analyst Meeting
Approx. 4.3 million annual births
Approx. 450,000 premature births
No major companies participate in this space
Many, many small players
Acquisition opportunities
Willing to pay for clinical improvements
No reimbursement issues
96
Labor & Delivery/Neonatal Market 2014 Analyst Meeting
In excess of $500 million in revenue annually
No major players
Many small
Currently have $10 million in annual revenue
Primary products
VAD (vacuum assisted delivery)
Dopplers
Infant Heel Warmers
Respiratory products
Specialty sales organization planned in FY 2015
8-10 FTEs
97
Target Markets: Ob/GYN Specialty 2014 Analyst Meeting
Establish a small specialty sales team
Explore acquisition targets
Product development opportunities
Produce line extensions
Next generation
New technologies
Plan is to obtain 20% market share
98
Labor & Delivery/Neonatal Next Steps 2014 Analyst Meeting
True worldwide opportunity
Same business model
Same protocols and procedures
Same use of products
Distinct/ unique call points
4,600 IVF clinics worldwide
Mostly stand-alone
Decision makers:
– IVF clinic manager
– Reproductive endocrinologist/ Fertility specialist
– Embryologist
High number of procedures
1.4 million fresh cycles
0.6 million frozen cycles
2.4 million IUI (intrauterine insemination)
Fairly high barrier to entry
Regulatory path
99
ART/IVF Market 2014 Analyst Meeting
Approximately $500 million in revenue
Origio currently has products that address 85% - 90%
Primary products:
Culture media
Oocyte (egg) retrieval
Embryo transfer catheters
Andrology (sperm analysis and preparation)
ICSI Pipettes
Vitrification (freezing and thawing of oocytes & embryos)
Ancillary products (lab products—dishes, glasses, etc.)
Time-lapse monitoring
Other lab equipment (workstations, microscopes, incubators, etc.)
Origio market leader
100
ART/IVF Market 2014 Analyst Meeting
101
Source: Internal Origio estimates
0%
5%
10%
15%
20%
25%
Origio Vitrolife Cook Irvine Wallace Kitazato Unisense Lifeglobal RI TPC Ksystem Others
Key IVF Medtech Players 2014 Analyst Meeting
Global market value ~$500 million/year
★ ★ ★
★
★ ★ ★
★
★
★
★
★
Australia
India
China Japan
Russia
Italy
Denmark
Spain
France
Germany
Benelux
U.K.
102
★ United States
Direct Sales and Marketing Presence 2014 Analyst Meeting
Market growth
Worldwide cycles expected to grow 6% - 7%
– Fresh cycles 3% - 4%
– Frozen cycles 8% - 10%
ASP expansion with move to frozen cycles
Geographic expansion
– New “Go Direct” markets – Turkey, Korea, Poland, Czech Republic, etc.
103
0
400,000
800,000
1,200,000
1,600,000
2,000,000Trends in U.S. IVF Cycles
fresh=new patients
ART/IVF Growth Drivers 2014 Analyst Meeting
Product line additions
– 1-Step Media
• Currently around 30% of media market
– Full line of Needles & Catheters
• Current market share at less than 5%
– Products currently under development
IVF Cycles Reported in 2013
Expected IVF Cycle Growth
Total Market Growth
China 161,000 12% 15%
Japan 155,000 0% 2%
USA & Canada 150,000 5% 8%
India 85,000 15% 20%
Russia 58,212 5% 11%
Germany 63,521 1% 3%
France 58,800 -2% -1%
Spain 48,000 0% 1%
Latino/ So. America 49,000 5% 11%
Italy 46,500 -7% -6%
UK 52,000 5% 6%
Australia 40,320 2% 5%
ROW 450,000 7% 10%
TOTAL ______________
2,000,000 ______________
6% - 7% ______________
8% - 10%
104
IVF Business Market Growth 2014 Analyst Meeting
Continued move to single embryo transfers
Reduces complications from multiple births
Less long-term side effects for women
Reduces costs by eliminating stimulation drugs
Freezing excess embryos
No reduction in success rates
Less costly than fresh cycle
Time Lapse Embryo Imaging
Assists in the selection of best embryos
– Monitors embryo development more precisely (not yet proven)
– Detects delays in embryo development, which indicates aneuploidy (chromosomal abnormality)
105
ART/IVF Trends 2014 Analyst Meeting
Product development
Many new and exciting opportunities
Origio has a world-class development team in place
Complete integration of all subs
All run independently today
Give them backend support
Evaluate additional “Go Direct” opportunities
Launch new products
1-Step
Needles and Catheters
BlastGen
Invest in sales and marketing to drive growth
Integrate all manufacturing activities
Improve margins 400 – 500 basis points
Leverage CSI core competencies
Discontinue non-strategic, low margin capital equipment
106
ART/IVF Next Steps for Origio 2014 Analyst Meeting
About one year ago, we started building our capabilities to develop products internally
Focused on both women’s healthcare business and IVF business
Not intended to be research driven, rather identify product line expansion products to fill our product portfolio and leverage our sales organization
First products to be launched from these efforts will be introduced over the next 6 months
Expected annualized revenue is in excess of $75 million from these initiatives in FY 2019
107
Product Development Initiative 2014 Analyst Meeting
ABBI™ Ally UPS
Advincula Arch – DSP Sacrocolpopexy tips
Launch Date
15 June 2015 Days until launch
285
Launch Date
17 November 2014 Days until launch
75
Launch Date
15 April 2015 Days until launch
224
Launch Date
11 November 2014 Days until launch
69
Estimated revenue potential: $2.6 million
Estimated revenue potential: $12.5 million
Estimated revenue potential: $4.5 million
Estimated revenue potential: $2.7 million
108
Product Developments 2014 Analyst Meeting
Embryo Transfer Catheters (full line) SAGE 1-Step
Oocyte Retrieval Needles Origio Sequential Media
Launch Date
15 January 2015 Days until launch
134
Launch Date
30 September 2015 Days until launch
392
Launch Date
24 November 2014 Days until launch
82
Launch Date
17 November 2015 Days until launch
348
Estimated revenue potential: $10.0 million
Estimated revenue potential: $3.0 million
Estimated revenue potential: $5.0 million
Estimated revenue potential: $7.0 million
109
All new products require country specific registration approvals
Origio Product Development 2014 Analyst Meeting
Well-positioned as the Women’s Healthcare Choice in changing market
Concentrate on focus markets
IVF
Labor & Delivery/ Neonatal
Establish product development capabilities
Leverage International infrastructure
Opportunity for women’s healthcare products
110
Going Forward 2014 Analyst Meeting
112
Recent Events
Sauflon Update:
Accounting Update Closed acquisition on August 6, 2014 Closing books for the first time now
Proforma
Statements to be released on form 8-K within 75 calendar days of August 6th (by October 20th)
Will provide proforma information for FY 2013 and FY 2014 July YTD to include Sauflon incorporated in The Cooper Companies financials
Additional quarterly proforma information to be provided prior to Q4 earnings call
Taxes Plan to transfer part or all of Sauflon’s intellectual property into CooperVision’s
global tax structure ⁻ Transfer details (timing, amounts etc.) dependent on valuation work ⁻ Any transfer of intellectual property will generate tax obligations ⁻ All costs are acquisition-related, and will be excluded from non-GAAP EPS
Plan to implement new structure prior to calendar year-end
2014 Analyst Meeting
113
2014 Analyst Meeting Recent Events
Debt Structure:
Announced a new $700 million term loan in conjunction with Sauflon close
Investment grade rating by S&P (BBB-, negative watch)
Term Maturity Date Total Size
Revolver 5 Year May 31, 2017 $1,000M
Term Loan 5 Year Sept. 12, 2018 $300M
Term Loan (new) 3 Year Aug. 4, 2017 $700M
Total $2,000M
$1,159 7.2%
$1,332 14.9%
$1,445 8.6%
$1,588 9.9%
$1,733 9.1%
$0
$400
$800
$1,200
$1,600
2010 2011 2012 2013 2014E*
Rev
enu
e ($
mill
ion
s)
Revenue Growth Drivers:
Silicone hydrogel, 1-Day lenses and acquisitions
114
Revenue
Consistent Revenue Growth
CAGR: 10.6%
*2014E represents midpoint of management guidance of $1,725 -$1,740M as provided 9/04/14. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
CAGR
CVI 9.7%
CSI 14.8%
TCC 10.6%
2014 Analyst Meeting
$693 $827
$924 $1,027
59.8%
62.1%
63.9%
64.7%
~65%
$0
$300
$600
$900
$1,200
2010 2011 2012 2013 2014E*
Gro
ss P
rofi
t (
$m
illio
ns)
115
Gross Profit and Gross Margin
Strong Gross Margin Improvement
Gross Margin Drivers:
Strong manufacturing efficiencies and favorable product mix e.g. Biofinity, offset by 1-Day, IVF and Sauflon
CAGR: ~13%
*2014E represents management guidance as provided 9/04/14. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
2014 Analyst Meeting
37.2% 37.7%
38.8% 38.4%
3.0%
3.3%
3.6% 3.7%
1.6%
1.5%
1.7%
1.9%
41.8%
42.5%
44.0%
44.0%
Total OPEX ~43%
$0
$200
$400
$600
$800
2010 2011 2012 2013 2014E*
OP
EX (
$m
illio
ns)
SG&A R&D Amortization
116
2014 Analyst Meeting Operating Expense
Strong Investment in SG&A and R&D
Operating Expense Drivers:
Invested heavily in operating expenses from 2010-2013 to support new product launches and geographic expansion
CAGR: ~11%
*2014E represents management guidance as provided 9/04/14, includes historic amortization and Sauflon. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
117
2014 Analyst Meeting Amortization
Amortization:
Amortization drops in 2015 related to the roll-off from two major acquisitions
Significant Drop in Amortization in 2015
Excludes Sauflon
$24
$30 $29
$22 $21
$0.38
$0.46 $0.44
$0.32 $0.29
$0.00
$0.10
$0.20
$0.30
$0.40
$0.50
$0
$8
$16
$24
$32
2012 2013 2014E 2015E 2016E
Am
ort
izat
ion
Exp
ense
($
mill
ion
s)
Total Amortization EPS Impact
$227 $281
$312 $358
19.6%
21.1%
21.6%
22.5%
~24%
$-
$100
$200
$300
$400
2010 2011 2012 2013 2014E*
Op
erat
ing
Inco
me
($m
illio
ns)
118
2014 Analyst Meeting Operating Income and Operating Margin
Strong Operating Margin Improvement
Operating Income Drivers:
Consistent revenue growth and gross margin expansion have driven operating margin improvements In 2013 and 2014, began to see SG&A leverage
CAGR: ~16%
*2014E represents management guidance as provided 9/04/14. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
2018 OM Target Excluding
Amortization and with Sauflon
26%+
Excludes amortization
119
2014 Analyst Meeting Effective Tax Rate
2014 Guidance: ETR 9.5-10.5%
Overall Tax Structure:
Large portion of intellectual property offshore in lower tax jurisdictions Majority of sales and manufacturing outside the U.S. in countries with lower tax rates Operations in over 35 countries, with differing tax laws Structure has gone through many successful reviews by tax authorities
*2014E represents management guidance as provided 9/04/14. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
15.7%
10.1% 9.7% 7.4%
16.7%
11.1% 10.7% 8.8%
9.5- 10.5%
0.0%
4.0%
8.0%
12.0%
16.0%
2010 2011 2012 2013 2014E*
Effe
ctiv
e T
ax R
ate
Reported ETR ETR Excluding Amortization
120
2014 Analyst Meeting Foreign Exchange
Foreign Exchange Impact
Foreign Exchange Drivers:
Major revenue impacts – Yen and Euro; major COGS impact - Pound
Based on current rates, we expect a negative year over year FX impact in 1Q, 2Q and 3Q FY 2015
Foreign Exchange Impact:
Negative impact of $0.40, $0.50 and $0.31 in 2012, 2013 and 2014, respectively Sauflon will increase FX exposure going forward
Yen GBP Euro
Aug-10 Aug-11 Aug-12 Aug-13 Aug-14 Aug-10 Aug-11 Aug-12 Aug-13 Aug-14 Aug-10 Aug-11 Aug-12 Aug-13 Aug-14
$3.10
$4.50 $5.16
$5.95
$3.38
$4.82 $5.54
$6.41 $7.39
$0.00
$2.00
$4.00
$6.00
$8.00
2010 2011 2012 2013 2014E*
No
n-G
AA
P E
PS
Non-GAAP Non-GAAP Excluding Amortization
121
2014 Analyst Meeting Earnings Per Share
Accelerated Earnings Growth Since 2010
CAGR: ~22%
*2014E represents midpoint of management guidance of $7.34 - $7.44 as provided 9/04/14, includes Sauflon and excludes amortization Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
EPS Drivers:
EPS drivers include revenue growth, gross margin improvements, operating expense leverage, lower tax rates and reduced interest expense
122
2014 Analyst Meeting Capital Expenditure
Increased Investment in Capital Expenditure
*2014E represents management guidance as provided 9/04/14.
Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
Capital Expenditure:
Major CapEx investments for 1-Day and Biofinity®
$74 $104 $100
$178
$200+ 6.4%
7.8% 6.9%
11.2%
12-13%
0.0%
3.0%
6.0%
9.0%
12.0%
15.0%
$0
$50
$100
$150
$200
$250
2010 2011 2012 2013 2014E
Cap
ital
Exp
en
dit
ure
($
mil
lio
ns)
Capital Expenditure % of Revenue
123
2014 Analyst Meeting Free Cash Flow
Strong Free Cash Flow
FCF Target 2014-2018
$1.3B
*2014E represents management guidance as provided 9/04/14. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
$194
$233 $230 $239
$200+
$0
$50
$100
$150
$200
$250
2010 2011 2012 2013 2014E
Free
Cas
h F
low
($
mil
lio
ns)
Free Cash Flow:
Strong improvements in operating cash offset by recent capital investments
124
Q4 2014
Guidance
FY14
Guidance
FY15
Guidance
TOTAL $477 - $490 $1,725 - $1,740 $2,000 - $2,060
CooperVision $395 - $405 $1,400 - $1,412 $1,675 - $1,715
CooperSurgical $82 - $85 $325 - $328 $325 - $345
Non-GAAP* $2.00 - $2.10 $7.34 - $7.44 $8.20 - $8.60
Sale
s EP
S
$ millions, except EPS
2014 Analyst Meeting Guidance
*Represents management guidance as provided 9/04/14. Non-GAAP – Refer to our Reconciliation of Non-GAAP to GAAP Operating Results.
125
2014 Analyst Meeting Additional Financial Commentary
Capital Deployment:
Invest in core business Strategic M&A Debt pay down Stock buyback
Share Buyback:
$500 million share repurchase program in place with $211.5 million remaining
availability
Repurchased approximately 2.8 million shares beginning in December, 2011 for $288.5 million under the current program
126
2014 Analyst Meeting Key Takeaways
1 • Solid revenue growth
2 • Improving operating margins
3 • Double-digit EPS growth
4 • Significant free cash flow generation
128
Grow revenue faster than our
markets
Grow EPS faster than revenue
Generate over $1.3 billion in free cash flow
Expand CVI and CSI
geographically
Complete strategic
acquisitions
2014 Analyst Meeting Long Term Objectives (2014 – 2018)
2018E operating
margin of 26%+