Elos Medtech - Interim report January 1 - March 31, 2018
Net sales for the quarter increased and amounted to SEK 155.7 million (140.9), corresponding to organic growth of 10.5%. After currency adjustments, growth was 11.3%.
Operating profit amounted to SEK 10.9 million (13.3). The operating margin in the first quarter of 2018 was 7.0%.
Profit after financial items amounted to SEK 9.6 million (9.6). Net financial items were positively affected by foreign exchange effects in the amount of SEK 0.8 million (-1.4).
Profit after tax amounted to SEK 7.1 million (7.2), which corresponds to SEK 1.15 (1.19) per share.
Cash flow from operating activities was SEK 8.7 million (11.9), and amounted to SEK -6.2 million (6.6) after investments.
Events during the quarter
New share issue – Elos Medtech AB has successfully completed a new share issue with preferential rights for existing shareholders. The share issue was oversubscribed by 58.3% and will bring the company SEK 104.9 million before issue costs.
FDA – Elos Medtech has received 510(k) clearance from the U.S. Food and Drug Administration (FDA) to market Elos Abutment Blanks on the U.S. market for dental implants.
Comments from the CEO, Jan Wahlström
Elos Medtech took its first steps on an exciting growth journey last year. During 2017, we invested significant efforts into streamlining our internal processes and strengthening our position as a key development and manufacturing partner in the global medical technology market. This work was necessary to establish the platform for growth and expansion that we are now rolling out. A precondition for the continuation of our growth journey is the confidence that our shareholders have shown us, not least through the strong oversubscription to the new share issue which took place in the Spring.
Sales figures remained strong during the first quarter. For the second consecutive quarter we achieve growth of more than 10 %, with the sales reaching SEK 156 million (141). Looking at the trailing twelve months figures, we have set a new sales record of SEK 592 million. We are continuing to invest in capacity increases throughout the entire Group to ensure that we are wellpositioned for future growth.
Over the past few months, we have actively communicated our strategic focus in Dental Implant Systems and Orthopedics and designated these as the Group’s primary business areas for future growth. A significant step in pooling our resources and achieving a greater response to our global offer has been the appointment of two Business Directors who are now leading our marketing strategies. With these two strong global platforms, we have enabled both faster and more efficient growth.
During the first quarter we have seen growth in four out of the five markets. In Dental Implant Systems, we report growth of almost 10 per cent and the trend we see is continued positive development with several business opportunities. Sales of our own products, including those under our own brand, are growing, especially online. Sören Olesen will lead and run our global strategy, focusing on increased investments in production capacity to strengthen and further develop the offering. The focus is mainly on introducing our dental offerings in the US market, where we also received clearance from the FDA in February to market Elos Abutment Blank.
Diagnostics has recovered extremely well after a year of lower growth. Growth in the quarter was 18 per cent. The explanation for this turnaround is that we have taken on more and more business from our existing customers.
Hearing Device & Vibration has also developed well during the beginning of the year in comparison with the previous year, with growth amounting to 21 per cent.
Our second main market, Orthopedics, experienced growth of 18 per cent in the first quarter. Our recovery is thus well on the way to the higher levels seen previously. Sales are driven by a couple of the larger customers. In Orthopedics, we are now executing several investments, thereby utilising the proceeds of the share issue. Among other things, we have modernised produc- tion facilities and are investing in new machine investments to continue to gain new business.
Profit remains at the lower end, even if the operating margin improved compared to the last quarter of 2017 and amounted to 7.0 per cent. During the quarter, we continued our internal improvement and efficiency work in EMOPEX and implemented both process and personnel changes. We see that the measures we have implemented are beginning to have an impact, while some challenges remain with regard to our higher growth rate.
Through efficiency enhancements, we can utilise capacity, collaborations and skills and blur the boundaries internally and towards customers. In this way, we can take greater responsibility for our customers through our valueadding Complete Performance ™ offer.
Gothenburg, April 2018
Chief Executive Officer
For further information, contact:
Jan Wahlström, President and CEO, +46 70-212 18 89, e-mail: email@example.com
Christian Bergaust, CFO, +46 70-293 50 40, e-mail: firstname.lastname@example.org
This is the type of information that Elos Medtech AB (publ) is obliged to publish in accordance with the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was issued for publication by the contact persons stated above on 24 April 2018, at 1:00 a.m. (CET).
For additional information about the Elos Medtech Group, visit www.elosmedtech.com