Interim report January - March 2016
First quarter January – March 2016
- Group net sales in the first quarter 2016 amounted to 158.9 MSEK (144.2), an increase by 10.2 percent compared to the corresponding quarter last year. At comparable exchange rates sales increased by 9.3 percent.
- Operating profit for the quarter increased to 23.6 MSEK (18.0).
- Result after tax for the period increased to 22.9 MSEK (18.6).
- Earnings per share amounted to 0.35 SEK (0.29).
- The cash flow from operating activities improved to 36.9 MSEK (23.8).
- Net cash at March 31 amounted to 163.5 MSEK (115.7), compared to 134.9 MSEK at the start of the year.
- At the end of the reported period Biotage had no holding of own shares. No shares were acquired under the repurchasing program decided at the 2015 Annual General Meeting.
Comments by CEO Torben Jörgensen
Biotage starts the year with a strong first quarter with good organic growth. Sales increase by more than 10 percent compared to the same period last year and by 9.3 percent at comparable exchange rates. Operating profit (EBIT) increased by no less than 31 percent. The operating margin (EBIT) is 14.8 percent and on a rolling 12 month basis it amounts to 12.9 percent. Strong sales due to a high market presence and an attractive product range together with lower production costs drive the improved results.
During the quarter we launched an updated evaporation system, Biotage®V-10 Touch, with considerably improved functionality and increased user friendliness. The market has responded positively to the launch. All our strategic product areas, above all Purification and Sample Prep, show double digit sales increases in percent. In Organic Chemistry the sales of our purification system Isolera™ contribute to the positive development. Our Flash products continue to be successful, not least in the Asian market. The company’s sales of Sample Prep products in Analytical Chemistry show continued growth in the important American market. We now also see that the sales of these products are increasing in the European market. We had a good quarter also in the product area Industrial Products, which also has double digit growth.
An increased number of sales staff in the primary markets, after a period of relatively large vacancies, is a major contributing factor to the sales increase. The establishment of direct sales in China has proved to be a successful initiative, resulting in a 46 percent growth compared to the same period last year. Japan shows a 24 percent growth in the period. Also Europe and North America had a strong quarter. Distributor sales continue to be below our expectations. The work to find better solutions continues, which will mean a larger proportion of direct sales.
The gross margin for the period is 57.1 percent and clearly marks a step in the right direction towards our strategic goal of 60 percent. The weakening of the GBP together with efficiency improvements and growing volumes at the production unit in Cardiff, Wales contribute to the significant improvement. Good cost control and a systematic effort to reduce working capital are also important contributing factors to the improved profitability and the strong cash flow. Biotage ends the quarter with close to 30 MSEK more in liquid resources than at the end of 2015.
The relative shares of system sales and aftermarket products (consumables and service) are 44 and 56 percent, respectively, in the quarter. We are a bit away from our strategic 40/60 goal. Compared to the last quarter 2015 the relation has improved by three percentages, however. The shift towards aftermarket products contributes to the positive development of the gross margin. After a number of successful system launches we are focusing on increasing the sales consumables in general, but especially for the new systems.
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
The information is of the kind that Biotage AB (publ) is required to make public according to the Financial Instruments Trading Act. The information was released for publication at 15.00 on April 28, 2016.
Biotage offers efficient separation technologies from analysis to industrial scale and high quality solutions for analytical chemistry from research to commercial analysis laboratories. The company’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 and Japan. Biotage has approx. 290 employees and had sales of 611 MSEK in 2015. Biotage is listed on the NASDAQ OMX Stockholm stock exchange. Website: www.biotage.com