Interim report January - September 2017
Continued strong momentum in Biotage’s operations
- Net sales amounted to 177.7 MSEK (167.0), which is an increase by 6.4 percent compared to the corresponding quarter last year. At comparable exchange rates* net sales increased by 9.8 percent.
- Operating profit increased by 7.5 percent to 29.3 MSEK (27.2).
- Result after tax increased by 12.4 percent to 31.1 MSEK (27.7).
- Earnings per share amounted to 0.48 SEK (0.43) before and after dilution.
- The cash flow from operating activities amounted to 30.5 MSEK (30.8).
- Net cash* at September 30 amounted to 119.6 MSEK (128.6), compared to 101.6 MSEK at June 30.
- At the end of the reported period Biotage had no holding of own shares. No shares have been acquired under the repurchasing program resolved at the 2017 AGM.
Nine months January - September
- Net sales amounted to 559.3 MSEK (488.8), which is an increase by 14.4 percent compared to the corresponding period last year. At comparable exchange rates net sales increased by 13.1 percent.
- Operating profit increased by 35 percent to 101.4 MSEK (75.0).
- Result after tax increased by 38 percent to 104.1 MSEK (75.3).
- Earnings per share amounted to 1.61 SEK (1.16) before and after dilution.
- The cash flow from operating activities amounted to 102.8 MSEK (96.7).
- Dividends to the shareholders were paid to the amount of 80.9 MSEK (80.9) in the month of May.
*See definitions on pp. 18-19
Comments by CEO Torben Jörgensen
Biotage continues to have a good momentum in the operations and the successes from the first six months of the year are followed by yet another strong quarter. For rolling 12 months the sales growth is 12.3 percent. Despite the negative impact of the development of the US dollar on the reported sales in the third quarter, Biotage continues to grow with maintained profitability. The gross margin in the quarter as well as the first nine months of the year and rolling 12 months exceeds 60 percent. The operating margin (EBIT) was 16.5 percent in the quarter and now reaches 14.4 percent on a rolling 36 months basis, to be compared to our goal of an average of 15 percent for the three years 2017-2019. The operating result improved by 7.5 percent compared to the corresponding quarter last year, despite a negative effect of almost 6 MSEK from other operating items, mainly attributable to exchange rate changes.
Larger sales volumes and efficiency improvements in production contribute to profitability improvements. Efficiency programs are being run continuously and not only in manufacturing. An equally natural part is to develop improved and more cost-effective solutions in R&D, beneficial for our customers as well as for Biotage. This often goes hand in hand with Biotage’s sustainability efforts. One example of this is Biotage’s in-house developed software in the product area purification, which reduces the use of solvents considerably. This results in costs savings for the customers and benefits the environment.
We produce large parts of the product range in our plant in Cardiff, Wales. In addition to the volume increases mentioned above and efficiency improvements, the weakening of the British pound also contributes to our good profitability. Increased consumables sales give a higher gross margin, but also the mix within systems and consumables leads to profitability variations. The relative share of system sales in the quarter was 48 percent, compared to our long-term strategic goal of maximum 40 percent.
All geographic regions with direct sales increased their sales compared to the corresponding quarter last year. Our direct sales in Asia continue to develop well. We see especially strong sales growth in South Korea and Japan. In India, where we have sold only through a distributor, the sales development is weak. Biotage has now established a subsidiary in India. The establishment of our own presence and direct sales has thus been initiated, with the aim to copy our previous recipe for success from South Korea and China. According to the establishment plan we will be operative in India at some time in 2018. The transition to direct sales only in Italy took place in July 2017.
The launch of the new generation of the evaporation system TurboVap® has been very well received in the market, with sales of close to 100 systems already this quarter. TurboVap® is a part of our product offering in analytical chemistry, which also includes the sales of consumables for Sample Prep, and both of these show a double-digit percentage increase in the quarter. In the product area industrial products we have seen a higher activity since the beginning of the year, resulting in more sales of Biotage’s biggest purification system Flash 400™ and related consumables.
Finally, it is with satisfaction that we can put the patent dispute in the US aside.
Coming financial reports
The year-end report for 2017 will be issued on February 8, 2018.
The Annual General Meeting 2018 will be held on April 26, 2018.
The interim report for the first quarter 2018 will be issued on April 26, 2018.
The interim report for the second quarter 2018 will be issued on July 16, 2018.
The interim report for the third quarter 2018 will be issued on November 6, 2018.
The year-end report for 2018 will be issued on February 7, 2019.
The Annual Report for 2017 is planned for publication in week 14 2018.
All reports are available at Biotage’s website from the above dates.
For further information, please contact:
Torben Jörgensen, President and CEO: phone: +46 707 49 05 84
Erika Söderberg Johnson, CFO, phone: +46 707 20 48 20
This information is information that Biotage AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 08.30 CET on November 2, 2017.
Biotage offers efficient separation technologies from analysis to industrial scale and high quality solutions for analytical chemistry from research to commercial analysis laboratories. Biotage’s products are used by government authorities, academic institutions, pharmaceutical and food companies, among others. The company is headquartered in Uppsala and has offices in the US, UK, China, Japan, South Korea and India. Biotage has approx. 330 employees and had sales of 668 MSEK in 2016. Biotage is listed on NASDAQ Stockholm. Website: www.biotage.com