Biotage AB (publ) Interim report January - March 2020
Positive growth and strong cash flow
- Net sales amounted to 277.3 MSEK (248.0), an increase by 11.8 percent compared to the corresponding quarter last year. At comparable exchange rates sales increased by 7.1 percent.
- Operating profit increased by 23.2 percent to 61.4 MSEK (49.8).
- Result after tax amounted to 61.3 MSEK (47.5).
- Earnings per share amounted to 0.94 SEK (0.73) before and after dilution.
- The cash flow from operating activities increased by 48.3 MSEK to 60.8 MSEK (12.5).
- Net debt1) at March 31 was 27.5 MSEK (69.2).
- Cash and cash equivalents amounted to 231.1 MSEK (185.9).
- Liabilities to credit institutions amounted to 109.6 MSEK (109.6).
- Om March 2 Lars Bäckman was appointed acting CFO.
- On March 17 Annette Colin was appointed new CFO and she took up the post on April 1.
- On March 26 Biotage announced that the Annual General Meeting will be postponed to June 4, 2020.
- On April 17 Biotage’s Board of Directors announced that the proposal for a dividend of 1.60 SEK per share will be withdrawn and instead it is proposed that no dividend be paid in connection with the Annual General Meeting. Furthermore, the board announced that they see an opportunity to convene an extraordinary general meeting later this year to decide on dividend for 2019.
1) See definition pp.15-16.
Comments by the CEO
It is with mixed feelings that I deliver Biotage's report for the first quarter of the year. The corona virus pandemic (COVID-19) affects us all. At Biotage we do what we can to try to offer customers, employees and society at large as safe an environment as possible. Modern technologies for meetings without physical encounters are utilized as far as possible. We provide information on how we can limit the spread of infection in accordance with recommendations from the World Health Organisation (WHO) and other authorities. At the same time, I am very proud and grateful for how Biotage managed to deliver a strong first quarter, both in terms of growth and cash flow, under these challenging circumstances.
The Americas showed strong sales in the first quarter of the year. In APAC China had a strong start of the year, interesting to note considering the spread of the corona virus at the beginning of the year. Both the US and China show double-digit growth in percent compared to the corresponding period last year and represent an increasingly large relative share of Biotage’s global sales. Sales in EMEA and Japan are not satisfactory and these geographies do not reach the levels of last year. South Korea and India continue to increase sales with good growth rates compared to the previous year.
Biotage’s Scale-up Products (formerly called Industrial Products) continue to develop well and now account for 15 percent of the quarter’s sales. Other product areas largely follow the previous distribution. The outbreak of the corona pandemic has meant that Biotage has experienced shifts in sales from the first quarter to the second as well as non-sales.
The distribution of sales between systems and aftermarket products (consumables and service) is 44/56, an improvement by two percentage points compared to the corresponding period last year. This product mix contributes to an improved gross margin amounting to 62.5 percent for the quarter (61.7). An increasing share of sales in USD is also a contributing factor.
Also the operating margin, EBIT, improved and amounted to 22.1 percent (20.1) for the quarter. Other operating items include currency effects that have affected the operating margin (EBIT) for the quarter positively by 12.7 million SEK (4.7), which gives a net effect of 8.0 MSEK for the quarter.
It is also very encouraging to know that we are one of many suppliers of products to companies and institutions that develop methods for treatment, analysis and vaccines against the corona virus. How the coming quarters will be affected is still difficult and too soon to have an opinion of. Clearly, we will see effects, especially if the situation lasts long. Biotage has a strong financial position, but a drawn-out process can be expected to impact also financially strong companies as Biotage negatively. Deterioration of our customers’ financial situation can also affect Biotage in terms of the customers’ solvency, which can lead not only to longer payment times, but also to long-term credit losses. It can be expected that also Biotage will have a challenging second quarter. Possible adverse effects above all depend on how long lasting the corona pandemic will be.
Since I took over the leadership of Biotage I have worked a lot together with the existing organization that has developed Biotage into the successful company that it is today, but also to identify areas where we can strengthen the organization further. We have made a number of external key recruitments, Annette Colin as CFO, Andreas Juhlin as President International, Jon-Sverre Schanche as new CSO and Petra Duprez as global HR and sustainability manager. Together with the knowledge and experience of Biotage’s existing employees, I feel that we now have a strong organization and management that can bring Biotage’s success story forward.
Uppsala April 2020
President and CEO
Coming financial reports
The interim report for the second quarter 2020 will be published on July 17, 2020.
The interim report for the third quarter 2020 will be published on November 5, 2020.
The year-end report for 2020 will be published on February 12, 2021.
All reports are available at Biotage’s website from the above dates.
The interim report for Biotage AB (publ) has been issued by the company's president and CEO Tomas Blomquist after authorization by the Board of Directors.
Uppsala April 28th 2020
President and CEO
For further information:
Tomas Blomquist, President and CEO
phone: +46 705 23 01 63
Annette Colin, CFO
phone: +46 703 19 06 76
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 28, 2020.
Biotage in brief
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, contract research and contract manufacturing companies, 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. 460 employees and had sales of 1,101 MSEK in 2019. Biotage is listed on NASDAQ Stockholm. Website: www.biotage.com