Zoetis CEO Talks Animal Health At William Blair Growth Conference

Animal health company Zoetis Inc ZTS was one of many presenters at the William Blair Growth Conference this week. CEO Juan Ramon Alaix discussed the advantages to investing in the animal health industry, the strength and resilience of the space and what Zoetis shareholders can expect in upcoming years.

Here’s some of the ket points Alaix made in his presentation.

The Market

According to Alaix, Zoetis’ market is at the core of both the domestic animal business and the livestock business, which represent a combined $100 billion industry. Animal health is currently a $24 billion market and it expected to grow to exceed $33 billion by 2020.

Growth Drivers

Alaix mentioned population growth, a growing middle class, and increasing urbanization as three global livestock growth drivers. Zoetis projects a 6.0 percent compound annual growth rate (CAGR) in livestock through 2018.

When it comes to pet care, Alaix listed increasing pet ownership and higher medicalization as growth drivers in emerging markets and specialty care and price as growth drivers in developed markets. Zoetis projects a 5.0 percent compound annual growth rate (CAGR) in pet care through 2018.

Resilient Industry

Alaix touts the animal health industry as a consistent performer for investors, regardless of global economic conditions.

Overall, the industry has grown at a 5.1 percent CAGR since 2006, but Alaix highlights that the need for protein as a dietary staple and the unwillingness of pet owners to sacrifice pet care allowed the animal health industry to grow in the low single digits even throughout the recession surrounding the Financial Crisis.


Alaix discussed Zoetis’ consistent margin expansion in recent years, which has the company on track to grow adjusted EBIT margins from 25 percent in 2014 to about 34 percent by 2017. Zoetis also has a plan in place to cut costs by $300 million in 2017.

Zoetis shareholders have enjoyed Alaix’s leadership as of late, as the company’s stock is up 15 percent so far in 2015 and more than 52 percent in the past year.

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