Interim Report, January-March 2014

January-March 2014

CEO statement

Meda has seen a positive start to the year. With an increase in net sales of 5% in the first quarter we are continuing to deliver organic growth of 3% and we are noticing an improvement in the EBITDA margin to 30.0%, despite the strong end to 2013.

Dymista was the growth engine during the first quarter and we are continuing to focus considerable effort on this launch. In addition to increased sales in the US we are now seeing rising market share in Europe, where the allergy season has started early this year. Dymista has now been launched on most of the markets in Europe and is performing well.

In the first quarter, emerging markets displayed organic growth of 2%. We expect the rate of growth on these markets to continue to fluctuate and vary between regions and markets. Several markets, including Turkey and Brazil, performed well during the quarter, while developments in Russia and Ukraine were weaker as a result of unrest in the region.

The OTC business area showed negative growth of -1% in the first quarter. The base business is showing stable numbers. As previously mentioned, we have initiated measures to improve the trend for the more recently launched products within the OTC area. We have come a long way, and we are in a phase where we are building brand awareness and shaping the position. However, it takes time to build brands and to see the impact of the programs that have been implemented.

Organic growth for Western Europe amounted to 2%. The region displayed positive growth apart from Germany, which was negatively impacted by strong sales at the end of 2013. We have mentioned before that we have seen an improvement in the market climate in Southern Europe, and both Spain and Italy have now shown positive growth for several consecutive quarters, albeit from low levels.

With organic growth of 14% in the first quarter, the US is the region that contributed the most to Meda’s growth. This was mainly fueled by Dymista and the launch of Aerospan. The response from asthma specialists is positive. During the early launch phase we will focus on specialists and experts within the field of asthma.

The EBITDA margin strengthened for the quarter compared with the full year 2013 and Q4, which is consistent with our objective for the full year. However, I would like to clarify that we will see variations between the quarters.

Meda’s ambition is to develop into a world-leading specialty pharma company. I believe that Meda is well-positioned to meet this challenge. Meda has broad geographic coverage of the global market and a well-established product portfolio, which combined with continuing product launches offers us excellent opportunities to grow organically going forward. Intensifying our focus on acquisitions will be even more important if the company is to achieve its goals. Meda has both financial and organizational capacity for growth through major acquisitions as well as a good track-record. I look forward to taking Meda to the next level, together with my colleagues.

We remain committed to previously announced objectives for the full year on continued healthy organic growth at the same level as 2013, and an improved EBITDA margin.

Jörg-Thomas Dierks

CEO

1) Organic growth: Sales growth adjusted for currency effects, acquisitions, disposed operations and revenues from the cooperation agreement with Valeant.
Webcasted presentation of the report on May 7 at 10.30 a.m.
 The presentation can be accessed at www.meda.se/financial-information/, where a recorded version will also be available until the next interim report is presented.

For further inquiries, please contact:
Paula Treutiger, Investor Relations, paula.treutiger@meda.se, +46 733-666 599.


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