Elanco Animal Health (ELAN) investor relations material

Strategic outlook and industry positioning

• The company operates in a durable $42 billion animal health industry projected to reach $60 billion by 2030, with balanced focus on pet and farm markets and a global presence in over 90 countries.

• Positioned as a top player in cattle, poultry, pigs, and number one in U.S. pet retail, leveraging a broad omnichannel portfolio.

• The industry is characterized by high regulatory barriers, strong brand loyalty, and value orientation, supporting consistent mid-single-digit growth for 30 years.

• Focus on consistent, predictable growth with a multi-wave innovation pipeline and a stronger financial profile, targeting sustainable shareholder value.

• Recent acquisitions and increased R&D investment have enabled a robust innovation pipeline and improved business mix.

Growth drivers, market trends, and innovation pipeline

• Projecting mid-single-digit organic revenue growth, high single-digit EBITDA, low double-digit EPS, and over $1 billion in free cash flow over the next three years.

• Six blockbuster products are driving current growth, with 15 more candidates in the pipeline and five to six additional blockbusters expected by 2028.

• Innovation pipeline expected to deliver $1.2B incremental revenue in 2026, with three innovation waves planned through 2032+.

• Trends include increased pet humanization, willingness to spend on innovation, and rising global protein consumption, supporting durable industry growth.

• The Elanco Ascend productivity initiative and operational excellence strategies are driving efficiency, leveraging AI, automation, and process improvements.

U.S. pet health market and performance

• U.S. pet health represents just under 30% of sales, with a diversified channel approach reaching both vet and non-vet customers.

• Key products like Credelio Quattro, Zenrelia, and Befrena are driving rapid adoption and market share gains, with significant room for further clinic penetration.

• OTC parasiticide leadership is expanding into value channels, including new product launches and retail partnerships such as Dollar General.

• The derm market is growing strongly, with Zenrelia and Befrena positioned to capture share in both JAK inhibitor and IL-31 mAb segments.

• U.S. pet health industry shows resilience, with 5% growth in 2025 and strong demand for senior pet care and subscription-based services.