November 14, Rich Meelia President & CEO

Transcription

1 November 14, 2007 Rich Meelia President & CEO

2 Forward-Looking Statements This presentation contains certain forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of These statements are based on management s current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. All statements contained herein that are not clearly historical in nature are forward-looking and the words anticipate, believe, expect, estimate, plan, and similar expressions are generally intended to identify forward-looking statements. The forward-looking statements in this presentation may include statements addressing the following subjects: future financial condition and operating results, economic, business, competitive and/or regulatory factors affecting our business. Any of the following factors may affect our future results: Our ability to effectively introduce and market new products or to keep pace with advances in technology The reimbursement practices of a small number of large public and private insurers Cost-containment efforts of customers, purchasing groups, third-party payors and governmental organizations Intellectual property rights disputes Complex and costly regulation, including healthcare fraud and abuse regulations Manufacturing or supply chain problems or disruptions Recalls or safety alerts and negative publicity relating to Covidien or its products Product liability losses and other litigation liability Rising prices for oil, gas and other commodities 1 Covidien November 14, 2007

3 Forward-Looking Statements (cont.) Divestitures of some of our businesses or product lines Our ability to execute strategic acquisitions of, investments in or alliances with other companies and businesses Competition Risks associated with doing business outside of the United States Foreign currency exchange rates Potential environmental liabilities Implementation of the ongoing reorganization of our operating structure Our ability to repay outstanding indebtedness on a timely basis or on commercially reasonable terms; or Increased costs after the separation from Tyco International or as a result of the separation These are examples of factors, among others, that could cause actual results to differ materially from those described in the forward-looking statements. In addition, our historical and pro forma combined financial information is not necessarily representative of the results we would have achieved as an independent, publicly-traded company and may not be a reliable indicator of our future results. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements whether as a result of new information, future events or otherwise. More detailed information about these and other factors is set forth in the information statement included in the Covidien Ltd. Form 8-K filing of June 8, 2007 and Covidien s Form 10-Q for the quarter ended June 29, Covidien November 14, 2007

4 Separation Update Staffing of corporate functions nearly complete Adding people to Tax, Treasury, Corporate Accounting, External Reporting, Legal, Human Resources, etc. Ability to attract top level talent as independent company Globalized business units to accelerate growth Implemented brand name rationalization resulted in Q4 impairment charge December 6 first post-separation reporting as independent public company 3 Covidien November 14, 2007

5 Debt Refinancing Refinanced portion of $3.2B outstanding under bridge loan $2.75 billion refinanced October 22 $250MM 5.15% Senior Notes due 2010 $500MM 5.45% Senior Notes due 2012 $1.15B 6.00% Senior Notes due 2017 $850MM 6.55% Senior Notes due 2037 $415 million remains outstanding under bridge loan Ratings Fitch A Standard & Poor s A- Moody s Baa1 4 Covidien November 14, 2007

6 Focus on Growth Internal Sales headcount investments Increased research & development (R&D) spending Creation of growth functions 5 Covidien November 14, 2007

7 Focus on Growth -- Internal Incremental Sales headcount Added more than 2,000 heads to sales in the last five years Covidien November 14, 2007

8 Focus on Growth -- Internal Increased R&D spending Targeted R&D investments Accelerated flow of new products Improved pipeline of opportunities Restructured and relocated Respiratory R&D activities Committed to increase R&D spending by basis points (as a percent of sales) over next few years 7 Covidien November 14, 2007

9 Focus on Growth -- Internal Creation of Growth Functions Portfolio Management New separate function at Covidien - incremental resources at Corporate and in operating divisions Optimize portfolio to strategically allocate resources Criteria include market growth potential, strategic fit, profitability, return on invested capital Identify business areas needing incremental investment Determine non-core categories for potential divestiture 8 Covidien November 14, 2007

10 Focus on Growth Internal Sales headcount investments Increased research & development (R&D) spending Creation of growth functions External Acquisitions Business Development & Licensing 9 Covidien November 14, 2007

11 Focus on Growth -- External Acquisition Strategy Focus on: Technology Filling product and / or geographic gaps Augmenting internal development activities Adding to intellectual property portfolio Leveraging global infrastructure 10 Covidien November 14, 2007

12 Focus on Growth -- External Acquisition Strategy Recent acquisitions In fiscal 2007, added Polysuture, a Brazilian suture manufacturer and AbsorbaTack technology - absorbable fixation devices for hernia repair In fiscal 2008, Scandius Biomedical 11 Covidien November 14, 2007

13 Focus on Growth -- External Acquisition Strategy Recent acquisitions Scandius Biomedical developer of devices for sportsrelated surgeries - Acquired November 7 Expands our presence in $1 billion sports surgery market and broadens portfolio Currently selling proprietary products for knee ligament fixation - arthroscopic reconstruction of ACL New sports surgery products in development Proprietary IP position International expansion opportunity leveraging global infrastructure 12 Covidien November 14, 2007

14 Acquisition Update: Confluent Supplier of polymer-based technology used in sprayable surgical sealants and anti-adhesion products Acquired August 2006 New Product Launches Next generation Spine sealant Duraseal FY SprayShield Vacuseal SP Xact Adhesion Barrier & Sealant System (Europe) Pleuraseal (Europe) Xact Spine Sealant 13 Covidien November 14, 2007

15 Acquisition Update: Floreane Innovator in the development of hernia meshes and surgical implants Step acquisition: October 2005 September 2007 New Product Launches Coated Mesh Parietex Mesh Sofradim FY Lap Inguinal Mesh Introducer Prolapse Mesh Parietene Progrip Mesh Plug Parastomal Mesh 2 nd Generation Prolapse Kit Umbilical Mesh 14 Covidien November 14, 2007

16 Focus on Growth -- External Business Development & Licensing History of successful acquisitions Building a proactive approach to aggressively identify and pursue opportunities Licensing focus: Filling technology gaps Leverage global scale Feed R&D with technologies acquired in early stage development 15 Covidien November 14, 2007

17 Focus on Growth -- External Licensing / Promotional Agreements - Recent Activity BioSynthema Nuclear medicine therapy for neuroendocrine cancer patients University of New South Wales Novel apoptosis detection technology Allergan Co-promotion agreement for Lap-Band TM gastric banding system 16 Covidien November 14, 2007

18 Covidien Global, diverse healthcare products company Increased commitment to driving growth and innovation Strong portfolio of leading brands, many of which are leaders in attractive market segments Global infrastructure that creates selling synergies and cost savings Demonstrated capability in operational excellence Strong financial profile Consistent revenue growth with more than 95% of sales from disposable products Strong, stable cash flow generation Solid balance sheet 17 Covidien November 14, 2007

19 November 14, 2007 Rich Meelia President & CEO