Summary of the Investor Event 2026 Conference Call Company Overview - The company is focused on the Animal Nutrition & Health sector, which has undergone significant transformation and portfolio tuning to enhance growth and profitability [1][2][3][4] - The company has achieved a size of EUR 9 billion, with an average organic sales growth of 4.5% per year, aligning with industry peers [10][31] Key Financial Metrics - The EBITDA margin has improved from 14% to nearly 20%, with a projected step-up of EUR 300 million in EBITDA from 2023 to 2025 [10][31] - The company aims for a cash conversion rate of 11%-12% for 2026, with a long-term target of 14% or higher by 2028 [37][46] Business Strategy and Growth Drivers - The company has split its Animal Nutrition & Health business into two segments: Solutions Co (specialty) and Essential Co (vitamins) to mitigate volatility and enhance profitability [5][6][7] - Focus on high-growth areas such as enzymes, cultures, probiotics, and fine fragrances, particularly in emerging markets like India, Africa, and Asia [38][40][41] - Emphasis on innovation in health and nutrition, particularly in women's health and preventative healthcare, to capture new market opportunities [16][41] Market Challenges - The company faces headwinds from foreign exchange fluctuations, with an estimated negative impact of CHF 100 million in 2024 and 2025, and CHF 70 million in 2026 [18][19] - A cautious consumer demand has been observed, particularly in North America, affecting inventory levels and purchasing behavior [19][20] Sustainability and Employee Engagement - The company has achieved a CDP double A rating on water and climate, indicating a strong commitment to sustainability, which is increasingly important to customers [9][10] - Employee engagement remains stable at around 80%, reflecting a positive internal culture despite ongoing changes [10] Technological Integration - The company is leveraging AI for ingredient discovery, production optimization, and enhancing the brief-to-adoption process, resulting in significant efficiency gains [25][26][30] - AI is seen as a tool to support, not replace, the creative roles of perfumers and flavorists, ensuring the company remains competitive [27][29] Future Outlook - The company projects organic sales growth of 2%-4% for 2026, with potential acceleration to 4%-6% in 2027 as market conditions normalize [37][42] - The focus will remain on optimizing existing operations and enhancing profitability through cost control and operational excellence [47][48] Conclusion - The company is positioned for growth through strategic portfolio management, innovation in health and nutrition, and a commitment to sustainability, while navigating market challenges and leveraging technology for operational efficiency [48]

Core Insights - Elanco Animal Health reported a full-year revenue of $4.715 billion, reflecting a 6% growth, with an organic constant-currency revenue growth of 7% projected for 2025 [1][8] - The company achieved an adjusted EBITDA of $901 million and an adjusted EPS of $0.94, an increase from $0.91 in 2024 [1] - Elanco's fourth-quarter revenue reached $1.14 billion, marking a 12% increase on a reported basis and a 9% organic constant-currency growth [3][4] Financial Performance - Full-year adjusted EBITDA was $901 million, with adjusted EPS at $0.94, up from $0.91 in 2024 [1] - Fourth-quarter adjusted EBITDA was $189 million, a 7% year-over-year increase, while adjusted EPS was $0.13, down 7% due to a higher anticipated tax rate [2] - The full-year adjusted gross margin was 54.9%, remaining flat compared to 2024, as inflation and higher manufacturing costs offset price and volume benefits [1] Growth and Innovation - Elanco's innovation revenue for 2025 was $892 million, with a raised outlook for 2026 to $1.15 billion, indicating at least $250 million growth year-over-year [7][9] - Key products driving growth include Credelio Quattro, Zenrelia, and the soon-to-launch Befrena, with Credelio Quattro being highlighted as the fastest blockbuster in the company's history [9] - The company reported strong performance in U.S. Farm Animal and U.S. Pet Health segments, with growth rates of 17% and 10% respectively in the fourth quarter [4] Strategic Initiatives - Elanco's net leverage improved to 3.6x by year-end 2025, with a target of 3.1–3.3x by the end of 2026, and net debt reported at approximately $3.2 billion [6][14] - The company announced an agreement to acquire AHV International, expected to contribute modestly in 2026 and more significantly in 2027 [6][15] - Management is focused on cash generation and has initiated a company-wide productivity initiative, Elanco Ascend, aimed at achieving $25 million in savings in 2026 [16] Market Dynamics - Elanco expects accelerating price contributions in 2026, with 2025 price growth at about 2% [10] - The company noted strong relationships with major distributors, with 90% of corporate accounts growing in 2025 compared to 13% in 2024 [11][13] - There were no significant changes in distributor stocking trends, with strong dispensing patterns observed [12] 2026 Guidance - For 2026, Elanco guided organic revenue growth of 4–6%, with projected revenue between $4.95 billion and $5.02 billion, adjusted EBITDA of $955–$985 million, and adjusted EPS of $1.00–$1.06 [8][18] - The first-quarter guidance includes revenue of $1.28 billion to $1.305 billion and adjusted EBITDA of $290 million to $310 million [15]

D 2025 Earnings – Fourth Quarter February 24, 2026 2025 | Q4 Earnings 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 2026 full year and first quarter guidance, long-term expectations, our expectations regarding debt levels, and expectations regarding our industry and our operations, performance ...

Core Insights - dsm-firmenich has announced the divestment of its Animal Nutrition & Health (ANH) activities to CVC Capital Partners, leading to the classification of these assets and liabilities as Assets Held for Sale and the financial results of ANH as Discontinued Operations [1][2] Financial Results - The financial results have been restated to present the Continuing Operations of dsm-firmenich, ensuring a comparable view of the company's ongoing performance over time [2] - Comparative figures for the most recent four reported quarters (Q4 2024, Q1 2025, Q2 2025, Q3 2025) and full-year 2024 will include line items such as Net Sales, Adjusted EBITDA, Adjusted EBITDA margin, and Organic Sales Growth [3] Reporting Structure Adjustments - The new reporting structure reflects significant adjustments for 2024 and 2025, particularly in the Perfumery & Beauty (P&B) segment, which now excludes Aroma Ingredients and Pentapharm, classified under Discontinued Operations [4] - The Taste, Texture & Health (TTH) segment has been adjusted to account for Yeast Extracts and certain vitamin sales that are now part of Discontinued Operations, while Bovaer has moved from ANH to TTH [5] - The Health, Nutrition & Care (HNC) segment has been restated to include Marine Lipids and certain vitamin sales from ANH, with Veramaris transferred from ANH to HNC [6] Discontinued Operations - Discontinued Operations now encompass ANH, Aroma Ingredients, Marine Lipids, Yeast Extracts, and certain vitamin sales, following a portfolio review communicated at the Capital Markets Day in 2024 [7] Key Performance Indicator Adjustments - dsm-firmenich will provide an updated 'Core EBIT' figure, which will add back merger-related amortization and amortization of other intangible assets recognized through purchase-price allocations from all pre-merger acquisitions, facilitating easier comparison with industry peers [8] Future Reporting Changes - Starting Q1 2026, Nutrition Improvement activities will transfer from Health, Nutrition & Care to Group Sustainability, reported under Corporate Activities, generating approximately €20 million in quarterly net sales and operating around break-even at the Adjusted EBITDA level [10]

Core Viewpoint - dsm-firmenich has announced the divestment of its Animal Nutrition & Health (ANH) activities to CVC Capital Partners, leading to a reclassification of the financial results of ANH as Discontinued Operations and the assets and liabilities as Assets Held for Sale [1][2]. Financial Results and Reporting Structure - The financial results have been restated to present the Continuing Operations of dsm-firmenich, ensuring a comparable view of the company's ongoing performance over time, with full-year 2025 results to be reported on February 12, 2026 [2]. - Comparative figures for the most recent four reported quarters (Q4 2024, Q1 2025, Q2 2025, Q3 2025) and full-year 2024 will include line items such as Net Sales, Adjusted EBITDA, Adjusted EBITDA margin, and Organic Sales Growth [3]. - The new reporting structure reflects primary structural adjustments for 2024 and 2025, particularly in the Perfumery & Beauty (P&B) segment, which has been restated for Aroma Ingredients and Pentapharm, now included in Discontinued Operations [4]. Segment Adjustments - The Taste, Texture & Health (TTH) segment has been restated primarily for Yeast Extracts and certain vitamin sales included in the ANH divestment, which have moved to Discontinued Operations, while Bovaer has been transferred from ANH to TTH [5]. - The Health, Nutrition & Care (HNC) segment has been restated for Marine Lipids and certain vitamin sales included in the ANH divestment, with Veramaris being transferred from ANH to HNC [6]. - Discontinued Operations now include ANH, Aroma Ingredients, Marine Lipids, Yeast Extracts, and certain vitamin sales, following a portfolio review communicated at the Capital Markets Day in 2024 [7]. Key Performance Indicator (KPI) Adjustments - dsm-firmenich will provide an updated 'Core EBIT' figure, which adds back merger-related amortization and amortization of other intangible assets recognized through purchase-price allocations from all pre-merger acquisitions, facilitating easier comparison with industry peers [8]. Future Reporting Adjustments - The Nutrition Improvement activities, focusing on sustainability-driven nutritional support and food aid programs, will transfer from Health, Nutrition & Care to Group Sustainability and will be reported under Corporate Activities starting Q1 2026, generating approximately €20 million in quarterly net sales [10].

Group 1: Fund Performance - Baron Health Care Fund rose 13.10% in Q4 2025, outperforming the Russell 3000 Health Care Index which gained 11.92% and the Russell 3000 Index which gained 2.40% [1] - For the full year, the Fund returned 10.28%, compared to 14.56% and 17.15% gains for the respective indexes [1] - Strong stock selection in biotechnology contributed to the Fund's relative gains in the quarter [1] Group 2: Investment Focus - The Fund seeks to invest in businesses with secular growth opportunities, sustainable competitive edges, and strong management [1] - The healthcare sector is viewed as a strong area in the U.S. economy, offering attractive investment opportunities with positive momentum heading into 2026 [1] Group 3: Elanco Animal Health Incorporated - Elanco Animal Health has a market capitalization of $12.079 billion and closed at $24.31 per share on February 5, 2026 [2] - The stock gained 3.58% over the past month and 111.02% over the last 52 weeks [2] - Elanco operates in an attractive industry with growth drivers such as increased pet ownership and higher spending on pets [3] Group 4: Innovation and Growth Potential - Elanco's management expects innovation revenue to reach $840 million to $880 million in 2025, increasing to $1.1 billion in 2026 [3] - Key innovation products include Credelio Quattro, Zenrelia, Befrena, Bovaer, and Experior, which are expected to drive growth and gross margin expansion [3] - The innovation pipeline includes five to six additional products expected to be approved between 2026-2031, with potential peak sales of $2 billion [3] Group 5: Financial Targets - Management targets 200-350 basis points of EBITDA margin expansion from 2025-2028 [3] - The company aims for $1 billion of cumulative free cash flow from 2026-2028 to pay down debt and reduce net debt to EBITDA from 3.7-3.8 times at the end of 2025 to 2.0-2.5 times by the end of 2028 [3]

Elanco Investor Day Summary Company Overview - **Company**: Elanco Animal Health - **Event**: 2025 Investor Day - **Focus**: Sustainable growth, innovation, and financial outlook Key Industry Insights - **Animal Health Market**: - Current size: $42 billion, projected to grow to $60 billion in the next decade [13] - Pet market projected to reach $24 billion by 2030, driven by parasiticides [43] - Farm animal market expected to grow to $27 billion, with poultry as a major driver [44] Core Company Strategies - **Sustainable Growth**: - Commitment to mid-single-digit constant currency revenue growth [8] - Focus on innovation with a commitment of $1.1 billion for the next year, aiming to double by 2028 [9][30] - **Innovation Pipeline**: - Introduction of five to six potential blockbusters between 2026 and 2031 [10] - Emphasis on a diverse portfolio with a strong pipeline of new products [30] - **Financial Goals**: - Targeting high single-digit adjusted EBITDA constant currency revenue growth starting in 2026 [11] - Projecting $1 billion in cash flow creation over the next three years [12] Market Trends and Drivers - **Pet Market Trends**: - Increased willingness of pet owners to spend on pet care [17] - Growing decision-making power of pet owners, necessitating CRM data and accessibility [18] - Shift towards omnichannel approaches to reach consumers [19] - **Farm Animal Market Trends**: - Focus on ruminants and poultry due to their durability and growth potential [21] - Emphasis on disease prevention and food safety as key growth areas [22] Financial Performance and Projections - **Recent Performance**: - Nine consecutive quarters of growth, with a stable base business now flat [46] - **Future Projections**: - Anticipated growth from the "Big Six" products, with significant contributions expected by 2026 [47] - Continued expansion in both pet and farm animal segments, leveraging existing strengths [50] Leadership and Organizational Structure - **Executive Team**: - Experienced leadership with a focus on innovation and market growth [36] - Commitment to employee engagement and performance management linked to financial outcomes [40] Additional Insights - **Restructuring Initiatives**: - Recent restructuring aimed at increasing efficiency and capacity [32] - Strategic partnerships and collaborations to enhance product offerings and market reach [55] - **Regulatory Engagement**: - Ongoing constructive dialogue with USDA for product approvals and market entry [34] Conclusion - Elanco is positioned for sustainable growth through a robust innovation pipeline, strategic market engagement, and a commitment to financial discipline. The company aims to leverage its strengths in both the pet and farm animal markets to capture significant growth opportunities in the coming years.

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.

Financial Data and Key Metrics Changes - Elanco reported revenue of $1.137 billion for Q3 2025, representing a 10% increase on a reported basis and 9% organic constant currency growth, primarily driven by volume increases [23][24] - Adjusted EBITDA was $198 million, an increase of $35 million year-over-year, while adjusted EPS rose to $0.19, up $0.06 from the previous year [25] - The net leverage ratio improved to 3.7x, better than expectations, with a target to end the year between 3.7x and 3.8x [6][25] Business Line Data and Key Metrics Changes - U.S. Pet Health revenue grew by 9%, driven by key innovation products like Credelio Quattro and Zenrelia, while international pet health achieved 8% growth [7][23] - U.S. Farm Animal business saw a significant 20% growth, supported by strong performance in cattle and poultry vaccines, while international farm animal grew by 5% [8][23] - Innovation revenue reached $655 million year-to-date, with an increase in guidance for innovation revenue to $840 million-$880 million for the full year [5][9] Market Data and Key Metrics Changes - The U.S. broad spectrum endecto market is currently valued at $1.4 billion, growing at nearly 40%, with Credelio Quattro capturing significant market share [10][40] - The global dermatology market for Zenrelia is estimated at $2 billion, with Elanco capturing approximately 5% market share in launched countries [13][16] - The farm animal market is experiencing strong demand for protein, with a resurgence in the U.S. dairy industry and favorable producer economics driving growth [72] Company Strategy and Development Direction - Elanco's strategy focuses on innovation, portfolio management, and productivity, with a commitment to driving shareholder value through consistent growth and operational execution [6][22] - The company is expanding its product offerings and geographic reach, particularly with the international rollout of Credelio Quattro and Zenrelia [10][13] - Elanco aims to improve its net leverage ratio to under 3x by 2027, supported by a disciplined capital allocation strategy focused on debt paydown [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic challenges, with expectations for continued growth in both pet and farm animal segments [7][32] - The company anticipates a stable operating environment, with a focus on leveraging innovation to mitigate potential declines in vet visit volumes [56][57] - Elanco's management highlighted the importance of maintaining a competitive edge through differentiated products and strategic investments in marketing and distribution [66][72] Other Important Information - Elanco successfully refinanced its $2.1 billion term loan B facility, extending maturities and reducing the cost of debt [26][27] - The company is on track for significant operational efficiencies through the Elanco Ascend initiative, which aims to enhance productivity across various functions [22][66] Q&A Session Summary Question: Clarification on Quattro's sales and peak potential - Management clarified that Credelio Quattro reached $100 million in sales year-to-date as of September, indicating strong market potential and differentiation [37][38] Question: U.S. label aspirations for Zenrelia - Management discussed ongoing efforts to improve Zenrelia's label in the U.S. and the positive momentum in international markets, highlighting strong market share gains [43][45] Question: 2025 EBITDA guidance and OpEx investments - Management confirmed the increase in EBITDA guidance and emphasized a data-driven approach to ongoing investments in innovation and marketing [49][50] Question: Consumer macro pressure and vet visit trends - Management noted that while vet visits are stabilizing, Elanco's diversified portfolio and strong market presence position the company well against macro pressures [53][56] Question: Competitive landscape in derm and parasiticides - Management indicated that competition is accounted for in guidance, with no significant impact observed from new entrants in the parasiticide market [76][77]

Financial Data and Key Metrics Changes - Elanco reported revenue of $1.137 billion for Q3 2025, representing a 10% increase on a reported basis and 9% organic constant currency growth, primarily driven by volume increases [23][24] - Adjusted EBITDA was $198 million, an increase of $35 million year-over-year, while adjusted EPS rose to $0.19, up $0.06 from the previous year [25][29] - The net leverage ratio improved to 3.7x, better than expectations, with a target to end the year between 3.7x and 3.8x [6][25] Business Line Data and Key Metrics Changes - U.S. Pet Health revenue grew by 9%, driven by key products like Credelio Quattro and Zenrelia, while international pet health achieved 8% growth [7][23] - U.S. Farm Animal business saw a significant 20% growth, bolstered by strong performance in cattle and poultry vaccines, while international farm animal grew by 5% [8][24] - Innovation revenue reached $655 million year-to-date, with an increase in guidance for innovation revenue to $840 million-$880 million [5][9] Market Data and Key Metrics Changes - The U.S. broad spectrum endecto market is valued at $1.4 billion and is growing at nearly 40%, with Credelio Quattro capturing significant market share [10][40] - The global dermatology market is estimated at $2 billion, with Zenrelia gaining approximately 5% market share in launched countries [13][16] - The farm animal market is experiencing strong demand for protein, with a resurgence in the U.S. dairy industry and a historically small cattle herd size driving producer economics [72][73] Company Strategy and Development Direction - Elanco's strategy focuses on growth, innovation, and cash management, with a commitment to raising guidance based on strong underlying momentum [5][7] - The company is leveraging its diverse portfolio of innovative products to stabilize its base business and drive overall industry-leading growth [21][22] - The Elanco Ascend initiative aims to enhance productivity and efficiency across the organization, contributing to margin expansion starting in 2026 [22][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic challenges, citing strong execution and proactive mitigation strategies for tariff risks [6][32] - The outlook for 2026 includes expectations for continued revenue growth driven by innovation and a stabilizing base, despite competitive pressures [30][31] - Management highlighted the importance of maintaining a balanced approach to guidance, considering competition and macroeconomic factors [57][59] Other Important Information - The company successfully refinanced its $2.1 billion term loan B facility, extending maturities and reducing the cost of debt [26][27] - Elanco plans to provide more insights into its strategy and financial outlook during the upcoming investor day on December 9 [34][78] Q&A Session Summary Question: Clarification on Credelio Quattro's sales - Credelio Quattro reached $100 million in sales year-to-date as of September, indicating strong market potential and differentiation [37][38] Question: U.S. label aspirations for Zenrelia - Management is optimistic about achieving a cleaner label for Zenrelia, supported by positive data and increasing market share in international markets [44][46] Question: 2025 EBITDA guidance and OpEx investments - The updated EBITDA guidance reflects strong performance and continued investments in innovation, with a focus on data-driven decision-making [48][50] Question: Consumer macro pressure and vet visit trends - Management believes that the company is insulated from declines in vet visits due to strong market fundamentals and a diversified portfolio [56][59] Question: Sustainability of livestock growth - The demand for protein is expected to remain strong, with Elanco's strategy focusing on innovation and competitive advantages in the livestock market [72][74]