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Voluntary update for the 10 months ended 30 April 2020

(Incorporated in the Republic of South Africa) (“Aspen Holdings”)
Registration number: 1985/002935/06
Share code: APN
ISIN: ZAE000066692
and its subsidiaries (collectively “Aspen” or “the Group”)


During these unprecedented times, Aspen management and Board have been monitoring the risks and
challenges associated with COVID-19, taking the necessary steps to maintain delivery of quality medicines
to patients across our regions while safeguarding the health and safety of our employees. Our immediate
focus under COVID-19 has been to establish processes aimed at ensuring optimum production and the
responsible allocation of essential drugs through heightened focus on our production and supply chain

Aspen is experiencing an elevated demand for certain of its Sterile Brands in Europe. These products are of
critical importance in the clinical management of patients infected with COVID-19 and we are making every
effort to support the healthcare authorities in Europe and the other regions where we operate. We wish to,
again, express our heartfelt gratitude to our employees throughout the world who have shown great
resilience, dedication and fortitude in allowing Aspen to continue to operate, ensuring delivery of
medicines to patients and caregivers reliant on our products during these exceptional times. In particular,
we highlight the commitment of Aspen’s production workers who leave the safety of their homes each day
to produce medicines for patients around the world.

Performance for the 10 months ended 30 April 2020

Commercial Pharmaceuticals

Our Commercial Pharmaceuticals business is divided into two segments, namely Sterile Brands and
Regional Brands. Certain products within both these segments have relevance in the management of
COVID-19, however the impact of the virus on the business has varied between regions.

Within the Sterile Brands business, elevated demand for Anaesthetics in Europe CIS towards the latter part
of the 10-month period has offset the expected decline in the Chinese business brought about by the
postponement of elective surgeries and less frequent haemodialysis treatment of patients during the first
four months of the calendar year 2020. The Chinese business has shown signs of recovery since the easing
of the restrictions in that country. In Europe CIS, Aspen’s largest Thrombosis region, the effect of COVID-19
on Thrombosis demand has been largely neutral, with declines in elective surgical procedures being
countered by increased hospitalisation rates of medically ill patients. The restructuring of the Thrombosis
business in Europe CIS has supported the continuing recovery of this business segment.

Stockpiling of everyday healthcare products and advanced filling of prescriptions by consumers in response
to the COVID-19 pandemic has had a positive impact on the Regional Brands business. This has led to
overstocking in supply channels and in households which we anticipate will result in decreased demand
over the next few months as stock levels equalise.

Aspen’s manufacturing facilities have maintained operations at normal capacity, with enhanced safety
measures introduced to protect employees. Aspen’s API manufacturing business has been positively
impacted by the sale of heparin API to third parties, while the underlying API and finished dose form
operations have also continued to perform well.

Europe CIS strategic review

The strategic review and internal restructuring undertaken in respect of the Europe CIS business has been
ongoing. Management continue to expect to finalise the outcomes of this strategic review and conclude on
an appropriate course of action by September 2020.

Capital Expenditure

Progress on strategic capital expenditure projects related to construction of manufacturing facilities for the
Anaesthetics products as well as smaller projects have been hampered by country specific COVID-19
restrictions and will resume as and when local regulations allow.

Working capital

Aspen’s maintenance of reasonable levels of safety stock through its value chain has, to date, stood us in
good stead during the COVID-19 crisis, allowing Aspen to continue to supply essential medicines to patients
in need around the world. In Europe, which has been particularly hard-hit by COVID-19, Aspen has been
well supported by its important manufacturing sites in France, Germany and the Netherlands and has
managed to redirect inventory successfully to the locations most in need. Aspen is also working hard with
its contract manufacturers and suppliers to overcome logistics hurdles as these arise in order to ensure
ongoing replenishment of finished products and raw materials. Careful attention is being paid to collections
of receivables and Aspen is ensuring that all of its creditors are paid to terms in this time of heightened
financial pressure on many businesses.

FY 2020 outlook

The Group outlook for the 12 months ending 30 June 2020, as published on 6 March 2020, did not take into
account the effect of the COVID-19 pandemic. The uncertainty surrounding the severity, impact and
duration of COVID-19 prevents Aspen from reliably assessing and quantifying the future impact of the virus
on the business. The unusual demand patterns experienced during the first four months of the calendar
year 2020 do not necessarily represent trends which will persist over the rest of the period of the COVID-19

Aspen completed the disposal of its Japanese business at the end of January 2020 and applied the net
proceeds received from it to repaying short dated Euro denominated debt. Aspen’s leverage ratio will be
measured at 30 June 2020 against a covenant level of 3.5x. The Group expects to deliver a leverage ratio
below this covenant level, as guided at the interim results presentation in March 2020. Aspen has reviewed
and is comfortable with its liquidity position.

The Group maintains the outlook published with its interim results announcement in March 2020 for
Normalised HEPS from continuing operations in FY 2020 to be higher as compared to the prior year
Normalised HEPS from continuing operations of R13.50.

Due to the high degree of uncertainty presently being encountered as a consequence of the pandemic, as
more information becomes available, the outlook for FY 2020 will be updated if deemed necessary. Aspen
is scheduled to release its annual result for the 12 months ending 30 June 2020 on 09 September 2020.
The financial information in this update has not been reviewed or reported on by the Group’s auditors.

15 May 2020

Investec Bank Limited

Date: 15-05-2020 08:00:00

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