Three-month interim report (Q1) 2017

Performance for the period (unaudited)
(Comparative figures for 2016 are shown in brackets. Revenue growth is measured in local currencies)

2016 comparative figures are affected by last year’s market disruptions which boosted ALK’s sales and earnings in Europe significantly, particularly in the first half-year. To provide a meaningful benchmark, comparisons to pre-disruption figures from 2015 have also been included in the report wherever relevant.  

ALK’s Q1 performance was in line with expectations and on course to meet the full-year guidance for 2017. Despite the negative impact of lower SCIT sales and a gradual market normalisation in Europe, revenue came close to Q1 2016 when adjusted for a one-off milestone payment. Revenue was significantly higher than before the market disruptions and ALK, to a large extent, retained its market share gains and remained the market leader. 

In summary:

• Total revenue amounted to DKK 789 million (848). When adjusted for one-off milestone payments and acquisitions, revenue decreased by 7% organically.
• Total revenue exceeded Q1 2015 ‘pre-disruption levels’ by 18% organically.
• Sales of SCIT products declined as expected due to last year’s production upgrades. The negative impact is estimated at DKK 50-60 million. SCIT production is gradually returning to normal ahead of the new pollen seasons.
• Operating profit (EBITDA) was DKK 140 million (277) as a result of planned cost increases to support long-term growth, as well as a changed sales mix.

Business priorities

• The organisational build-up to support the SLIT-tablets in North America is on track but a delay in the regulatory transfer of the biologics licenses has constrained sales and marketing activities.
• ALK has retained its market leadership position in Europe and the key market of France and is still investing heavily to slow down the competitor's recovery of market shares and to secure a strong landing and leadership.
• ACARIZAX^® sales almost tripled in Europe; clinical development and registration activities progressed as planned in all regions.
• SCIT production output is normalising and capacity will be further increased to eliminate backorders and ensure adequate supply ahead of the new pollen seasons starting in the second half of the year.

2017 financial guidance

Full-year guidance is unchanged from the 2016 annual report, which was released on 7 February 2017:

• Full-year revenue is projected at DKK 2.8-3.0 billion (2016: DKK 3.0 billion) as European markets establish a ‘new normal’ following last year’s disruptions. Revenue growth will be constrained while SCIT product supply returns to normal levels.
• Operating profit (EBITDA) is expected to return to 2015-levels before partner income at approximately DKK 300 million (2016: DKK 642 million), reflecting significantly increased costs to support long-term growth as well as a changed sales mix.

Hørsholm, 9 May 2017

ALK-Abelló A/S

For further information, contact:
Investor Relations: Per Plotnikof, tel. +45 4574 7527, mobile +45 2261 2525
Media: Jeppe Ilkjær, tel. +45 7877 4532, mobile +45 3050 2014 

Today, ALK is hosting a conference call for analysts and investors at 1.30 p.m. (CEST) at which Management will review the financial results and the outlook. The conference call will be audio cast on http://ir.alk.net/. Participants in the audio cast are kindly requested to call in before 1.25 a.m. (CEST). Danish participants should call in on tel. +45 7022 3500 and international participants should call in on tel. +44 (0) 20 7572 1187 or +1 646 722 4972. Please use the Participant Pin Code: 24197655#. The conference call will also be webcast live on our website, where the related presentation will be made available shortly before the call begins.

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