Orexo — Update 21 February 2017

Orexo, a Swedish speciality pharmaceutical company founded in 1995, is a product-based drug delivery company with a focus on addiction and pain and expertise in reformulation technologies (in particular sublingual formulations). It has three marketed proprietary drugs; core drug Zubsolv (opioid dependence) has been sold by Orexo through a dedicated US contract field force since launch in September 2013. Mundipharma holds the licence to ex-US global rights. Abstral (cancer breakthrough pain) and Edluar (insomnia) are sold by partners. Orexo also has an undisclosed pipeline of reformulations of approved compounds as well as OX-CLI (a preclinical respiratory programme licensed to Astra Zeneca) and OX-51 (a Phase III-ready acute pain programme for which Orexo is seeking a partner). It adopted the name Orexo in 2003 and listed on NASDAQ-OMX Stockholm in November 2005, raising SEK333m gross (3.7m shares at SEK90). Subsequent equity raises include SEK250m in June 2011 (6.6m shares at SEK38) and SEK346.3m in September 2014 (2.5m shares at SEK139). Orexo has 100 employees (excluding the c 50-strong inVentiv salesforce), US commercial operations in New Jersey and a Swedish R&D facility.

Our new valuation (vs SEK4.54bn or SEK131/share previously) is based on a lower US peak market share and peak sales following our breakdown into existing markets and new patients. Evolution in market share, competitive landscape and overall market trends since launch have altered the profile of the opportunity for Zubsolv. We extend our explicit DCF-based valuation to 2032 (expiry of latest patents) and update the long-term tax rate to 22%. We continue to assume 10% WACC, no terminal value and a long-term gross margin of 80% on Zubsolv by 2025, driven by manufacturing improvements and higher production volumes, with the operating margin gradually trending to c 45% in the long term. Our valuation includes potential European Zubsolv revenues (assuming late 2018 launch, €100m peak sales, 10% net royalty) but no potential milestones.

Zubsolv and Abstral revenue growth and ongoing cost control generated a positive FY16 EBITDA (SEK76.7m). US Zubsolv revenues grew 16% to SEK481.8m despite loss of CVS Caremark exclusive status (January 2016); ex-US, SEK65.9m in milestones was received from Mundipharma. FY17 guidance includes year-on-year Zubsolv net revenue growth due (market growth and share gains), lower operating expenses of SEK500-510m and positive EBITDA (on current FX rates); we have revised our forecasts accordingly. FY16 operating profit and improved working capital generated positive operating cash flow (SEK156.2m). In Q416, a SEK99m bond repurchase lowered net debt at end December 2016 to SEK115.4m, with SEK282.4m of cash and equivalents.

Recent legislation should steadily expand the evolving US opioid dependence market, but continued pricing/rebating pressures and increased competition will impact Zubsolv market share gains, peak sales potential and the long-term gross-to-net. Key near-term sensitivities include the outcome of reimbursement discussions, and patent litigation regarding Zubsolv and Suboxone Film. Various factors could affect our valuation, either through their influence on Zubsolv’s market penetration (pricing, reimbursement and branded/generic competition) or on operating margins (cost of promotion, revenue split between commercial and public plans, rebating). At this point, the technology platforms and early-stage R&D pipeline (including OX-51) represent pure upside.

2016 was a year of achievement for Orexo, both financially and operationally; however, this has not been reflected by company share performance. Undeniably IP infringement litigation remains a stock overhang, although with shares trading near 52-week lows and the market assuming limited potential for Zubsolv, it could represent a buying opportunity ahead of a numerous catalysts.

The most significant news flow anticipated over the next 12 months includes potential EMA approval of Zubsolv (Q417) with first European launches in 2018, and the prospect of new product opportunities which could represent valuation upside. There are two potential opportunities:

Market share gains since Zubsolv’s launch in 2013 coupled with evolution of the competitive landscape and overall market trends (growing importance of public segment, pricing/rebating pressure) have changed the profile of the opportunity for Zubsolv. Hence, we have revisited our US Zubsolv assumptions to better capture the potential impact of recent US legislative changes and Orexo’s aim of securing a disproportionate share of new patients. We have also carried out a scenario analysis that suggests the downside risk of genericisation is largely priced in.

According to our model, the current share price (SEK32.5) is supported by a scenario whereby Zubsolv does not improve its current market share (6% overall market, 10% new patients), rebating remains high and it loses 80% of peak revenues to generics (and/or other competition) from 2019. However, this does not factor in a commensurate and likely significant decrease in sales costs as Orexo switches to a branded generic strategy and implies ‘996 is the only patent Orexo is able to defend and no settlement is reached with Actavis.

Orexo emerged from 2016 on a sound financial footing, delivering continued Zubsolv and Abstral revenue growth, a maiden year of positive EBITDA, a fifth consecutive quarter of positive operating cash flow and an improved balance sheet following repurchase of SEK99m of corporate bonds. These financial achievements support Orexo’s aim of becoming a sustainable specialty pharma company and FY17 guidance suggests that profitability will be recurring. Management expects continued Zubsolv US net revenue growth and is guiding to operating expenses of SEK500-510m, resulting in positive EBITDA and positive cash flow for FY17.

From an operational perspective, major achievements during 2016 include the ex-US global licensing agreement for Zubsolv with Mundipharma followed soon after by regulatory filing in Europe (potential approval in Q417) and securing a first large exclusive agreement in fee for service (FFS) Medicaid in Maryland. Maryland is the largest fee for service Medicaid state in the US with c 1.3% overall market share by value. Other important milestones include completion of the real world RESOLV study, the approval of a lowest Zubsolv dose strength (0.7mg buprenorphine) , the grant of two additional Zubsolv patents and continued improvement of the market access position (largely recovering from the loss of CVS Caremark excusive status in January 2016). Importantly, Zubsolv has shown early traction with C275 physicians (which have been certified to expand their prescriber base to 275 from the previous 100 patient cap), with a disproportionate share of growth captured. Legislation to improve access to treatment is a key growth driver for Zubsolv as Orexo is targeting a disproportionate share in new patients, continuing a trend whereby Zubsolv has been more successful in winning a higher share of new patients than in switching existing patients. Behind the scenes, Orexo has also been working on the supply chain and manufacturing with a ‘substantial improvement’ in Zubsolv COGS expected to start to show an impact in 2018.

Net Zubsolv revenues for FY16 were SEK481.8m, up 15.6% on FY15, demonstrating a recovery in market share following the negative impact early in the year from the loss of the CVS Caremark agreement (effective 1 January 2016). On a quarterly basis, underlying demand was flat between Q316 and Q416, with growth of market share in the more profitable commercial segment (+0.1 percentage points) offsetting loss in the higher rebate public segment (-0.6 percentage points). However, Q416 revenues (SEK128.2m) were 10% lower than Q316 largely due to loss of share in Medicaid and the impact of significant stocking (at both wholesalers and pharmacies) associated with Maryland FFS in the earlier quarter. As previously flagged by Orexo, a proportion of patients under Maryland FFS reverted to their original treatment option (which requires prior authorisation) during Q4, although this decline has now stopped. At end-FY16, Zubsolv had c 40% of volume of Maryland FFS market share, with c 16% lower Rx for Q416 vs Q316. In addition, there was a decline in the WellCare Managed Medicaid business as SelfRefind clinics in Kentucky left WellCare plans in December, which will have an impact into early 2017.

Exhibits 1 and 2 show the progression of growth in both Zubsolv net revenue and market share since launch. Average market share by volume (rolling four weeks) was 5.8% (Q416) vs 6.1% (Q316), with average market share by dollar value of 6.0% (Q416) vs 6.2% (Q316).

Orexo expects continued year-on-year growth in Zubsolv net revenues as it gains share in a growing market. However, the gross to net in FY17 will continue to come under pressure due to a changing payer mix (Zubsolv’s increasing share of volume in the public segment) and overall competitive pricing pressure. A 5-6% price rise across all Zubsolv doses, effective 1 January 2017, will provide a partial offset. In our view, three of the main factors determining Zubsolv revenue dynamics (other than new legislation and completion, discussed in subsequent sections) are:

In line with management guidance, we expect year-on-year growth in Zubsolv US revenues for FY17, based on both market share gains and implementation of new legislation (C275 certification and the Comprehensive Addiction and Recovery Act of 2016, CARA 2016), which will steadily expand the overall market for medically assisted opioid dependence treatment. The new Trump administration has created uncertainty regarding broad US healthcare policy with plans to repeal the Affordable Care Act (so-called Obamacare); there is ambiguity around what will replace it. Nevertheless, we are not unduly concerned about the impact on opioid dependence treatment and believe it will be limited. Recognition that the opioid epidemic represents a public health crisis, the overwhelming bipartisan support for CARA 2016 and public comments from the new president prior to assuming office, all indicate strong backing for improved access to treatment.

As C275 and CARA are put into practice (see bullets below for current status) we forecast increased momentum in Zubsolv revenue, although it will take time for physicians to grow their practices to the higher patient cap and the ramp up in Zubsolv market share is likely to build in tandem.

As more patients are able to access treatment, there is an expectation that increasing numbers of new patients would seek therapy. Orexo is targeting a disproportionally higher share of new patients enabled by continued salesforce optimisation. The principal determinants of salesforce deployment and potential expansion are a favourable market access position and the regional distribution of C275 physicians. At end-December 2016, 78% of C275 physicians were accessible to the existing Zubsolv field force with coverage of 60%.

Over the August to December 2016 period, Orexo confirmed higher market share capture (TRx) with C275 physicians compared with the overall market across all segments. In the commercial and cash segments this was 3.5 percentage points higher, and 5.6 percentage points higher for Medicaid. The latter is particularly relevant as the public segment accounted for 70% of the initial growth C275 physicians and over the same period, 7.7% growth was seen with C275 physicians vs 4% in the overall market.

The direct (and indirect) threat from generics has suppressed Orexo’s share price over the past year. The timing of the introduction of the first lower-priced generics into the US opioid dependence market will be determined by the outcome of IP infringement suits filed by Orexo (Zubsolv) and Indivior (Suboxone Film), although there may not be clarity for some time.

Aside from the prospect of a Zubsolv generic, which we discuss below, competition in the opioid dependence market will intensify in the coming years with the potential launches of the first long-acting buprenorphine depot products in 2018 and Suboxone Film generics after 2024. Long-acting monthly subcutaneous depot injections from Indivior (RBP-6000) and Camurus/Braeburn (CAM2038, once-weekly formulation also in development) will broaden the treatment options available to physicians. These have clear benefits in relation to adherence and limiting diversion, but several critical hurdles need to be negotiated (including but not limited to physician education, supply chain/logistics, patient preference for oral/injectable delivery), which will determine their ultimate market share. In comparison, Suboxone Film generics are likely to have a greater impact on market dynamics; unlike premium-priced Suboxone tablet generics, the Suboxone Film generics will be priced at a discount, further increasing existing pressure on pricing and rebating.

The November 2016 court ruling on Orexo’s 8,454,996 Zubsolv patent precludes Actavis generic launch before September 2019; however, Zubsolv’s IP portfolio also includes the newly granted 9,259,421 and 9,439,900 patents, which extend to 2032. These patents, coupled with an appeal ruling on the invalidity of the 8,940,330 patent (also 2032 expiry) represent significant hurdles ahead of generic launch.

Exhibit 3 summarises the litigation situation and the buprenorphine doses and patents affected. Actavis is the only company to file ANDAs (abbreviated new drug applications) for Zubsolv generics to date. Since Actavis’s first ANDA filing, four additional Zubsolv strengths have been FDA approved (0.7mg, 2.9mg, 8.6mg and 11.4mg) and two new Zubsolv patents issued (‘421 and ‘900). Actavis has filed additional ANDAs covering the new dose strengths (except the 0.7mg dose approved in October 2016), with Orexo responding by initiating separate litigation processes.

The first Paragraph IV IP infringement suit was heard in June 2016, with the court upholding the validity of Orexo’s ‘996 US patent but not of ‘330. Orexo has appealed the decision on the ‘330 patent (which has a 2032 expiry) and is expecting a decision in late Q417 or early 2018. Overlap of the various ANDA filings and patents challenged by Actavis means the final court decision in this first case is likely to affect the process/outcome of the subsequent suits. An appeal outcome, plus rulings on subsequent suits is expected from 2018 onwards.

The current date range of potential Actavis generic launch is from 2019 to 2032, with the worst case scenario assuming that all IP falls except patent ‘996. Our sensitivity analysis models a downside range of SEK1.29bn to SEK2.84bn (SEK37 to 82/share) vs our SEK3.29bn (SEK95/share) valuation depending on peak market share achieved before genericisation and the magnitude of generic erosion. However, this simple analysis does not factor in the following:

Access to the global opioid dependence market is a key growth driver for Orexo; the licensing deal with Mundipharma, struck in June 2016, opens up the ex-US global opportunity for Zubsolv. In exchange for out-licensing exclusive global ex-US Zubsolv rights, Orexo received a €7m upfront payment and is eligible for further undisclosed economics, which are understood to include regulatory and commercial milestones and up to low double-digit net sales royalties.

Mundipharma made its first Zubsolv regulatory submission in October 2016, filing an MAA with the EMA. European approval is expected by end 2017 and we anticipate first launches in 2018, although timing would be contingent on completion of reimbursement decisions, which have varied timelines in different EU member states. We also note that either existing US or European bioequivalence data could be used to support regulatory filings in other jurisdictions. However, given limited disclosure on Mundipharma’s plans, at this point we only include a modest Zubsolv contribution for Europe. More detail on our assessment of the potential Europe opportunity is provided in our August 2016 update note, Margins, Maryland and Mundipharma.

Zubsolv is Orexo’s single commercial product, sold through a dedicated field force. Management has a stated intention of leveraging this commercial organisation, selling additional complementary products through the same channels. Prospects are under evaluation and centred on co-morbidities addressed by addiction specialists, such as psychiatric conditions (including anxiety, depression and non-opioid addiction), sleep disorder and pain. The profile of the opportunity, competitive landscape and potential economics would inform deal structure (co-promotion/co-distribution, in-licensing, product acquisition); however, no guidance has been provided on the timeframe in which the first deal(s) is expected to be secured.

Beyond Zubsolv, Orexo’s R&D pipeline consists of two disclosed programmes (OX-51 and OX-CLI) and a series of undisclosed early-stage drug delivery opportunities in addiction medicine. These programmes represent pure valuation upside as we do not ascribe any value to the pipeline given the lack of visibility on development timelines.

Orexo is subject to various sensitivities common to speciality pharmaceutical companies, including commercialisation (pricing, reimbursement, uptake and competition), manufacturing and financing risks. Key sensitivities relate to Orexo’s main value driver, Zubsolv. The US market for opioid dependence treatment continues to evolve, and recent legislative changes are expected to steadily expand this market. Nevertheless, the pace of market share gains by Zubsolv and the long-term gross-to-net ratio will be affected by continued pricing/rebating pressures and increased competition as various players (including those with potential new generics or buprenorphine depot products) seek to maintain or win favourable commercial or public formulary status.

Our valuation is based on our estimates for Zubsolv’s net price (after co-pay or other discounts) and penetration in the US and Europe, which we believe are reasonable. Key sensitivities include the outcome of ongoing reimbursement discussions with payers, and ongoing patent litigation regarding Zubsolv and Suboxone Film, which will determine when the first lower-priced generics can enter the market. Both have a significant bearing on Zubsolv’s sales trajectory and peak sales potential in the US.

Various factors could have an impact on our valuation, either through their influence on Zubsolv’s market penetration (eg reimbursement, pricing, branded/generic competition) or on operating margins (cost of promotion, revenue split between commercial and public plans, rebating). Fluctuations in the US$/SEK FX rate may also impact profitability and valuation as the majority of revenues are US-dollar denominated while costs include a SEK component. We also highlight that, ex-US, we only explicitly value the European opportunity as there is limited disclosed information on potential regulatory timelines in other regions. Exhibit 4 outlines our Zubsolv SWOT analysis.

Non-Zubsolv related sensitivities include the performance of Abstral in Europe and the US, and potential approvals and launches in other regions. Also, we do not value the technology platforms and R&D pipeline, including OX-51, which could represent upside.

We have revisited our valuation methodology for Orexo to better capture the potential impact of recent legislative changes in the US. We now explicitly break down our US Zubsolv forecasts into two parts: the existing market and new patients. Orexo’s aim of securing a disproportionate share of new patients means these forecasts are subject to certain differing dynamics. Our new Orexo valuation is SEK3.16bn or SEK91/share (vs SEK4.54bn or SEK131/share previously).

In addition to the change in methodology (and associated assumptions that we outline below), we have made a number of housekeeping adjustments, rolling forward our model and updating our forecast with FY17 guidance and the prevailing FX rates (now SEK8.82/US$ from SEK8.84/US$; SEK9.46/€ from SEK9.69/€).

We extend our explicit DCF-based valuation to 2032 (previously to 2030) in line with expiry of the longest dated Zubsolv patents, and update the long-term tax rate of 22% from 2017 (in line with the current Swedish corporate tax rate vs our previous 30% assumption), but continue to assume a WACC of 10% and no terminal value. We also continue to estimate a long-term gross margin of 80% on Zubsolv by 2025, driven by manufacturing improvements and higher production volumes, with the operating margin gradually trending to c 45% in the long term.

We include a modest revenue contribution from global Abstral and Edluar royalties until 2020, at which point we assume for simplicity that all revenues relate to Zubsolv, Orexo’s main value driver. Following FY16 results, we have lowered our US Abstral forecasts from 2017 onward, modelling a slower relaunch trajectory and lower peak sales given progress made so far by Sentynl Therapeutics (and impending genericisation in 2018); we also lower our Edluar revenue expectation from 2017 due to prospect of first generics this year.

In the absence of information regarding Orexo’s R&D pipeline, we ascribe no value to this. Securing a partner and defining the indication for OX-51 could unlock valuation upside, as would pipeline expansion (first disclosures are anticipated later this year). Finally, acquisition of new product(s) for commercialisation by the Zubsolv US sales infrastructure would also represent upside.

Exhibit 5 summarises our Zubsolv revenue assumptions to 2022, broken down into three segments: the US current market, US new patients, and the European market.

We have substantially revisited our assumptions in the US. Market share gains since Zubsolv launched in 2013, coupled with evolution of the competitive landscape and overall market trends (growing importance of public segment, pricing/rebating pressure), have changed the profile of the opportunity for Zubsolv. Our more detailed model results in both lower peak market share (from an aggregate 25%) and overall peak sales, which underpin our lower Orexo valuation. Our previous 2021e sales assumption of c $580m gross (c $300m net) is reduced to c $250m gross ($140m net). The key base case assumptions behind our new model are:

In Europe we continue to assume launch by late 2018, subject to reimbursement decisions from various national authorities, with European sales of c €60m in year six, peak sales of €100m (20% share of a conservative €500m market growing at 2% pa); and a net royalty of 10%. We model a long-term average rebate of 20% from 2022. As the magnitude and timing of milestones from Mundipharma are undisclosed, these are not captured in Exhibit 5 or our full model; nevertheless, we would expect milestones to become due on approval/launch in key territories. In addition, we do not explicitly value the RoW opportunity (ex-US, ex-Europe) until Mundipharma discloses its intention and there is more clarity on timelines; we recognise this could provide upside to our forecasts.

The uncertainty regarding the generic threat (both direct and indirect, ie Suboxone Film generics) has weighed heavily on the share price over the past year. The outcome of IP infringement suits filed by Orexo (Zubsolv) and Suboxone Film (Indivior) will determine launch timing of the first lower priced generics into the US opioid dependence market, and like continued pricing/rebating pressures, are a downside risk to our forecasts. Consequently we explore various scenarios centred on penetration/rebating levels (Exhibit 6) and the worst case scenario of Zubsolv generic entry in 2019 (Exhibit 7), which indicate that the market views limited prospects for Zubsolv.

According to our model, the current share price (SEK32.5) is supported by a scenario whereby Zubsolv does not improve its current market share (6% overall market, 10% new patients), rebating remains high and it loses 80% of peak revenues in the first year post-genericisation (ie in 2020). However, this does not factor in a commensurate and likely significant decrease in sales costs as Orexo switches to a branded generic strategy. Additionally, it implies that Orexo loses its appeal on ‘330, is unable to defend other approved patents, and/or does not reach a settlement with Actavis.

We have not explored potential upside scenarios but highlight there are several circumstances that could lead us to upgrade our Zubsolv forecasts. More certainty regarding the increasing genericisation of the opioid dependence market is one. Others include evidence of a growth step up/increased market share stimulated by improved market access (new contract wins with insurers) and also higher underlying market growth driven by implementation of new US legalisation to increase access to treatment. Our model indicates that market share gains (penetration) in the next couple of years are the most important determinant of valuation.

2016 was the first year in which Orexo achieved a positive EBITDA (SEK76.7m), supported by growth in Zubsolv and Abstral revenues coupled with a continued focus on managing costs. Total FY16 revenues of SEK705.9m were 9% higher than FY15 revenue of SEK646.2m (restated1), despite a 19% decline in revenue over the last quarter (Q416: SEK184.7m vs SEK228.3m in Q415) due to non-recurring Abstral milestone recognised in Q415.

US Zubsolv revenues grew 16% to SEK481.8m (vs SEK416.7m). Ex-US, SEK65.9m in Zubsolv-associated milestones was received from Mundipharma. Abstral royalty receipts of SEK100.4m were up 30% on FY15, due to strong growth in Europe and the rest of the world, although total Abstral revenues were lower (FY16: SEK102.6m vs FY15: SEK203.1m) due to non-recurring revenues booked in FY15. These comprised the final SEK59.9m of the fixed royalty payment and SEK66m in milestones. Exhibit 8 summarises the FY16 revenue breakdown and our full-year FY17 product forecasts. Management expects continued year-on-year growth in Zubsolv net revenues due to both growth in the underlying market and also market share gains. No material income is expected from Mundipharma. Our new FY17e revenue forecasts are lower than in our last note due to a refined Zubsolv model, lower US Abstral royalties and generic competition for Edluar as described in the Valuation section above.

Increased manufacturing efficiencies resulted in a further improvement in COGS to SEK149.6m in FY16 (vs SEK150.2m in FY15), despite the SEK6.5m additional cost in Q416 associated with the re-packaging of Zubsolv tablets following FDA approval of a longer shelf life. This re-packing project, which lowers the risk of inventory write offs, did not complete by end-2016 as intended; an additional spend of c SEK5m is anticipated during H117.

Full-year operating costs were SEK534.5m (FY15: SEK611.3m). Field force optimisation from late 2015 onwards resulted in a 19% decrease in sales expenditure (FY16: SEK240.6m vs SEK297.5m in FY15), although Q416 costs were higher than guided due to US$ strengthening vs SEK. R&D spend of SEK132.2m was also lower than FY15 (down 23% from SEK172.6m) reflecting costs incurred in relation to RESOLV in FY15 vs the early stage of undisclosed internal pipeline projects and Mundipharma bearing the costs associated with the completion of the regulatory bio-equivalence study for EU submission under the Zubsolv ex-US global licence in FY16. Costs associated with the Actavis Zubsolv IP infringement suit drove the 14% increase in admin expenses to SEK161.5m (FY15: SEK141.5m); almost half of total admin spend was linked to IP litigation. Orexo has guided to lower operating expenses of SEK500-510m for FY17; we have revised our forecasts and now expect total Opex of SEK506.2m for FY17. This is comprised a modest increase in sales costs vs FY16 to SEK249.1m, a slight decrease in R&D spend to SEK131.2m, and lower admin costs of SEK125.9m reflecting an anticipated decrease in legal expenses.

Other income of SEK29m in FY16 included FX gains from balance sheet revaluation and also the final earn out in relation to the Kibion disposal in April 2015. For FY15, other expenses of SEK65m included the SEK62m write-down of OX-MPI.

FY16 operating profit was SEK51.7m (FY15: loss of SEK180.6 m), with a PBT of SEK35.6m vs SEK203.6m loss for FY15 and EBITDA of SEK76.7m (FY15: loss of SEK99.9m). Based on current FX rates, Orexo is guiding for positive EBITDA for FY17. However, H1 EBITDA is expected to be negative due to the weighting of Abstral royalties to H2 (in the EU, sales need to exceed €42.5m to trigger the 15% royalty). Coupled with working capital improvements (reduced receivables), the FY16 operating profit generated positive operating cash flow (including interest payment) of SEK156.2m (FY15: negative SEK109.2m). Q416 was the fifth consecutive quarter of positive operating cash flow. Overall cash flow was SEK71m (pre-FX), with Orexo repurchasing SEK99m of corporate bonds during Q416. As a result, net debt at end December 2016 stood at SEK115.4m, with SEK282.4m of cash and equivalents. A further SEK59m of bonds were repurchased in February; the remaining SEK342m corporate bond loan outstanding comes due on 9 May 2018.

We have updated our financial model with our revised Zubsolv and Abstral forecasts, new FY17 guidance and latest FX rates. Exhibit 10 provides a detailed summary, as well as full FY18e financial forecasts for the first time. Key forecast changes to FY17e are presented in Exhibit 9.