Defining Elanco's New Era of Growth December 9, 2025 1 Introduction Tiffany Kanaga VP Investor Relations & ESG 2 Notices and Disclaimers Forward-Looking Statements. This presentation contains forward-looking statements within the meaning of the federal securities laws, including, without limitation, statements concerning product launches and revenue from such products, our 2025 full year and fourth quarter guidance, long-term expectations, our expectations regarding debt levels, and expectations regarding o ...

Core Insights - Elanco Animal Health is entering a new era of sustainable growth and long-term value creation, emphasizing its Innovation, Portfolio, and Productivity (IPP) strategy to achieve mid-single digit organic revenue growth and adjusted EBITDA margin expansion [1][2] Financial Outlook - Elanco has outlined a three-year financial outlook starting in 2026, projecting mid-single digit organic constant currency revenue growth, high-single digit adjusted EBITDA growth, and low double-digit adjusted EPS growth [4][5] - The company anticipates a net leverage ratio improvement to below 3x by 2027, with a long-term target of 2.0x to 2.5x [4][5] - Expected innovation revenue contribution is approximately $1.1 billion in 2026, with plans to double revenue from 'Big 6' blockbuster products by 2028 [4][13] Innovation Strategy - Elanco is developing over 10 major innovation products, with 5-6 blockbuster-potential approvals expected between 2026 and 2031 [4][11] - The company has two in-house technology platforms focused on monoclonal antibody discovery and immuno-therapeutics, enhancing its innovation pipeline [4][11][12] - The anticipated launch of Befrena™, an injectable monoclonal antibody for canine dermatitis, is expected in the first half of 2026 [7][10] Operational Efficiency - Elanco's Elanco Ascend program aims to generate $200 to $250 million in adjusted EBITDA savings by 2030, with approximately 30% of these savings expected in 2026 [17][18] - The company plans to restructure its operations, including the closure of its German animal R&D facility and a targeted reduction in its manufacturing workforce, impacting around 600 roles [16][18] Market Position - Elanco holds leading positions in U.S. Pet Health and global markets for poultry, beef, and swine, positioning itself for sustained growth [13] - The company is committed to investing in U.S. operations, including expanding its R&D presence and manufacturing capabilities [3][9]

Core Insights - Zoetis Inc. is a leading player in the animal health industry, offering a variety of products and services for both livestock and pets, and is recognized for its innovative solutions and strong market presence [1] - Barclays has set a price target of $136 for Zoetis, indicating a potential price increase of approximately 15.1% from its current trading price of $118.16, reflecting confidence in the company's market strategies and growth potential [2][6] - The stock has shown significant fluctuations over the past year, with a high of $181.85 and a low of $115.25, while maintaining a strong market capitalization of approximately $52.07 billion [4][6] Company Performance - Zoetis's stock recently experienced a slight decrease of 0.41%, with a trading range between $117.52 and $120.15 for the day, indicating active investor interest with a trading volume of 4,361,906 shares [2][4] - The company's participation in industry conferences, such as the Piper Sandler 37th Annual Healthcare Conference, is crucial for discussing its strategies and innovations, reinforcing its leadership in the animal health sector [3][5][6] Market Outlook - The optimistic outlook from Barclays and the company's strategic initiatives are vital for Zoetis's continued growth and market performance, especially as it navigates the dynamic healthcare landscape [5][6]

Group 1 - The total number of shares representing the share capital is 12,704,542 as of November 30, 2025 [1] - The gross total of voting rights is 8,390,660 as of the same date [1] - The net total of voting rights, which excludes shares with no voting rights, is 12,691,706 [1] Group 2 - The company is listed on Euronext Paris under ISIN code FR0000031577 [2] - The company specializes in animal health [2] - Contact information for corporate finance is provided, including a phone number and email address [2]

Core Insights - The company has demonstrated high R&D efficiency, particularly in the animal health sector, which is attributed to starting development in target species, leading to faster and cheaper development times [1] R&D Efficiency - The company emphasizes its ability to validate targets much sooner than in human health, contributing to overall efficiency in R&D processes [1] Upcoming Innovations - The company expressed excitement about upcoming products that will be highlighted on Innovation Day, indicating a focus on advancements in their R&D pipeline [1]

Core Insights - ImmuCell Corporation (ICCC) focuses on innovative cattle-health solutions that reduce reliance on traditional antibiotics while addressing calf scours and cow mastitis [1][3][4] Company Overview - ImmuCell is dedicated to creating scientifically proven products that enhance the health and productivity of dairy and beef cattle, targeting significant challenges in dairy systems [3] - The company positions itself as a "non-Pharma pharma" innovator, utilizing novel active ingredients rather than conventional antibiotics or vaccines [4] Product Offerings - **First Defense**: This product provides immediate immunity to newborn calves, helping to prevent scours and supporting herd productivity without requiring dam-level vaccine injections [7][8] - **Re-Tain**: A novel Nisin-based therapy for subclinical mastitis, designed to avoid human-use antibiotics, potentially saving the dairy industry approximately $2 billion annually [9][10] Market Performance - ImmuCell's stock has increased by 17.4% over the past year, outperforming the industry composite's decline of 0.7% and the S&P 500's growth of 15.1% [2] Customer Validation - Positive testimonials from producers and veterinarians highlight the efficacy and ease of administration of First Defense, with reports of scours incidence dropping by 75% after its adoption [11][12][13] Operational Strength - The company has invested in specialized manufacturing infrastructure, operating a USDA facility for First Defense and an FDA facility for Re-Tain, ensuring quality control and scalability [14] - Recent capacity expansions have increased First Defense's annual capacity to approximately $30 million, with further expansion options available [15][16] Financial Performance - For the nine months ending September 30, 2025, ImmuCell reported a net income of $1.8 million, a significant turnaround from a net loss of $2.7 million in the previous year, driven by higher sales and improved margins [17][18] - The gross margin improved to around 43% from 27% year-over-year, indicating enhanced production efficiency [18]

Core Insights - The company anticipates natural gross margin expansion driven by a growing and accelerating basket of innovation, which has higher margins than the corporate average [1] - The proactive approach of the company includes cost-related initiatives and productivity measures, particularly through investments in automation and AI to enhance gross margins [1]

Core Thesis - Zoetis Inc. is positioned as a dominant player in the growing animal health industry, benefiting from the trend of pet humanization as households increasingly prioritize pet care over traditional child-rearing [2][5] Financial Performance - The company has demonstrated strong financial performance with high single-digit revenue growth, margin expansion, and a double-digit EPS CAGR over the past six years [3] - Zoetis maintains a robust balance sheet characterized by solid liquidity, low leverage, and steadily growing retained earnings, alongside consistent free cash flow generation [3] Market Segments - While growth has moderated in the OA Pain franchise, both the companion animal and livestock segments continue to perform well, with management indicating stabilization in the OA Pain business [4] - Short-term headwinds, such as slowing vet visits, are not expected to significantly impact long-term demand for pet care products [4] Valuation and Investment Case - Projecting operating cash flow growth at 5% and CAPEX growth at 7% leads to a five-year free cash flow to the firm CAGR of approximately 4% [4] - Applying a 30x exit FCF multiple suggests a five-year IRR of around 14%, indicating an attractive risk/reward profile for investors [5] - The combination of resilient growth, industry leadership, and strong financial health supports a compelling long-term investment case for Zoetis [5] Recent Developments - Despite a 22.17% depreciation in stock price since previous coverage, the bullish thesis remains intact due to the company's strong financials and emphasis on pet humanization [6]

Summary of Conference Call Company Overview - The conference call involved **Zoetis**, a company specializing in animal health and life sciences tools, with key speakers including CEO Kristin Peck and CFO Wetteny Joseph [1][2]. Key Industry Insights - **R&D Efficiency**: Zoetis has a highly efficient R&D process, starting with target species, leading to faster development times and lower costs compared to human health. This efficiency is attributed to the use of AI, genetics, diagnostics, and biomarker data [2][3]. - **Pipeline Strength**: The company has a robust pipeline with 12 blockbuster products expected to launch over the next four years, each projected to generate at least $100 million in revenue. Notable upcoming products include a long-acting Cytopoint in 2026 and renal CKD treatments in 2027 [4][5]. Product Launches and Market Opportunities - **Chronic Kidney Disease (CKD)**: The CKD market is valued at $3-$4 billion, with significant unmet medical needs for both dogs and cats. Zoetis plans to launch seven assets targeting this condition, including therapeutic and diagnostic products [6][7]. - **Librella**: The product is stabilizing in the U.S. market, with expectations for gradual growth starting in 2026. Over 75% of pet owners report high satisfaction with the product [10][11]. - **Market Expansion**: Zoetis is entering new markets with blockbuster products, particularly in CKD and oncology, which together represent over $5 billion in addressable market [5][40]. Competitive Landscape - **Market Dynamics**: The company anticipates heightened competition in 2026, particularly in the derm market, but remains confident in its differentiated product offerings [27][30]. - **Product Differentiation**: Librella is expected to differentiate itself by offering a longer-lasting treatment option compared to competitors, which could expand the market significantly [13][15]. Financial Guidance and Performance - **Guidance Adjustments**: Zoetis lowered its guidance for Q3 due to a decline in therapeutic visits and underperformance of Librella. The company had anticipated slower growth in the second half of the year due to competitive launches [25][26]. - **Long-term Growth Drivers**: The company aims to grow above market rates, driven by a strong core portfolio and a robust pipeline of new products. The focus remains on expanding in the derm, parasiticide, and pain management markets [39][40]. Strategic Focus - **Capital Allocation**: Zoetis emphasizes reinvesting in the business and maintaining a strong balance sheet while considering share buybacks as part of its capital allocation strategy [46][47]. - **Market Trends**: The aging pet population and increased medicalization globally present significant growth opportunities for Zoetis, allowing the company to leverage its extensive portfolio [44][45]. Conclusion - Zoetis is positioned for growth with a strong pipeline, efficient R&D processes, and a focus on addressing unmet medical needs in the animal health market. The company remains optimistic about its future despite current market challenges and competitive pressures [48][49].

Elanco Animal Health FY Conference Summary Company Overview - **Company**: Elanco Animal Health (NYSE: ELAN) - **Date of Conference**: December 04, 2025 Key Industry Insights - **Industry**: Animal Health - **Market Size**: The U.S. pet health market is transforming into a growth business, with significant contributions from innovation and differentiated products [7][10] - **Dermatology Market**: The U.S. dermatology market is valued at $1.3 billion, growing at double digits, while the global market is approximately $2 billion [10] Core Points and Arguments Margin Expansion and Cost Management - Elanco is focusing on margin expansion through innovation, with a higher margin on new products compared to corporate averages [3] - The Elanco Ascend initiative aims to improve margins through cost management, automation, and strategic supplier partnerships [5][6] - Expected EBITDA growth in 2026 due to cost measures and investments in R&D and marketing [6] Product Innovations and Market Performance - **Zenrelia**: Achieved significant growth with total sales doubling from Q2 to Q3, and clinic penetration reaching 45% [10][11] - **Quattro**: Exceeding growth expectations, with a focus on broad-spectrum parasiticide market [12][30] - **Experior**: A key product in the farm animal segment, with a market potential of $350 million in the U.S. and Canada [12][23] Farm Animal Business Insights - The farm business represents half of Elanco's operations, with EBITDA margins comparable to the pet side [19][23] - The market for farm products is stable and growing, with a $25 billion market size [23] - Bovaer, another product, has shown strong customer retention rates despite muted growth due to lack of government incentives [24][26] Competitive Landscape and Market Strategy - Elanco is prepared for competitive product launches, having factored them into their business outlook [58] - The company emphasizes differentiation in its product offerings, particularly in the parasiticide market [58] Financial Performance and Deleveraging Strategy - Elanco has successfully reduced its debt from 5.6 times to an expected 3.738 times by the end of 2025, with a goal to be below three times by 2027 [43][44] - The company plans to maintain a balanced capital allocation strategy focused on debt reduction and business investment [61][62] Future Outlook and Investor Day - Upcoming Investor Day will provide detailed insights into growth strategies, manufacturing capabilities, and financial projections for the next three years [67] Additional Important Points - The humanization of pets is driving increased spending on pet health, with consumers willing to invest more in their pets' well-being [36] - Elanco's strategy includes a diverse portfolio to mitigate the impact of declining veterinary visits [37][38] - The company is leveraging its OTC portfolio to cater to consumers who do not visit vets regularly [37] This summary encapsulates the key insights and strategic directions discussed during the Elanco Animal Health FY Conference, highlighting the company's focus on innovation, market growth, and financial stability.