Interim report January-March 2017
Good growth and substantially improved operating profit
First quarter, January – March 2017
- Net sales amounted to 185.2 MSEK (158.9), an increase by 16.6 percent compared to the corresponding quarter last year. At comparable exchange rates sales increased by 12.9 percent.
- Operating profit increased by 48 percent to 34.9 MSEK (23.6).
- Result after tax increased to 35.3 MSEK (22.9).
- Earnings per share amounted to 0.55 SEK (0.35) before and after dilution.
- The cash flow from operating activities amounted to 29.2 MSEK (36.9).
- Net cash at March 31 amounted to 152.1 MSEK (163.5).
- 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 2016 Annual General Meeting.
Comments by CEO Torben Jörgensen
Biotage starts 2017 with record sales and record profitability. Sales increased by 12.9 percent at comparable exchange rates. In general the demand is high in all our product areas. We are now also beginning to see the effects of our investments in a larger market presence, with an increased number of sales reps and increased direct sales. It is with satisfaction that I note that we at the same time continue to improve our operating margin. It amounts to 18.9 percent for the quarter. In the last three-year period we now have an average EBIT margin of 13.3 percent, compared to the new financial profitability goal of a 15 percent average for the three-year period 2017 to 2019.
The gross margin increased to 60.9 percent, which is in line with our strategic goal of 60 percent. Larger production volumes, a higher degree of automation and general efficiency improvements at the plant in Cardiff, UK, contribute to the improved gross margin, as do continued favorable exchange rates for the British pound as well as the US dollar. A further contributing factor to the improved profitability is our competitive products that enable us to maintain our sales prices.
The investment in direct sales contributes positively to the sales successes in general. The latest initiative with our own representation in South Korea has developed well. Sales in this quarter were more than 150 percent higher than the corresponding period last year. In addition, our subsidiary in China is developing very well and its sales increased by more than 58 percent in the quarter. All countries with direct sales are growing by more than 10 percent compared to the first quarter 2016. We will continue to expand our direct sales. Next in line is Italy, where we so far have worked with a distributor in the area of analytical chemistry Starting in July, we will sell our entire product range through our own organization.
All product areas of strategic importance to Biotage grew by more than 10 percent compared to the first quarter 2016. Our peptide products account for the largest growth, more than 100 percent. The sales of evaporation systems continued to exceed our expectations also in this quarter and grew by more than 50 percent. We are further increasing our efforts in analytical chemistry and are among other things making a targeted investment in China in sales resources and specialist competence.
System sales accounted for 47 percent of the sales in the quarter and aftermarket products for 53 percent. The main reason for the increased share of system sales is our successful sales of the purification system Isolera™ in China.
We continue to invest substantial resources in research and development. During the next six months we are looking forward to launching two new systems.
Financial reporting calendar
The interim report for the second quarter 2017 will be issued on July 18, 2017.
The interim report for the third quarter 2017 will be issued on November 2, 2017.
The year-end report for 2017 will be issued on February 8, 2018.
This report has not been reviewed by the company’s auditors.
Uppsala April 27, 2017
President and CEO
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 and the Securities Markets Act. The information was submitted for publication, through the agency of the contact persons set out above, at 15.00 CET on April 27, 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 and South Korea. Biotage has approx. 330 employees and had sales of 668 MSEK in 2016. Biotage is listed on the NASDAQ OMX Stockholm stock exchange. Website: www.biotage.com