CLS publishes interim report January – September 2024
Summary of the interim report (relates to the Group)
First nine months (01/01/2024–09/30/2024)
- Net sales totaled SEK 14,171,000 (SEK 3,817,000).
- Profit/loss after financial items totaled SEK -39,130,000 (SEK -55,257,000).
- Basic and diluted earnings per share totaled SEK -4,1 (SEK -24,7).
- The equity ratio at September 30, 2024, was 85% (86%).
The third quarter (07/01/2024 – 09/30/2024)
- Net sales totaled SEK 5,409,000 (SEK 1,978,000).
- Profit/loss after financial items totaled SEK -12,967,000 (SEK -17,247,000).
- Basic and diluted earnings per share totaled SEK -0,98 (SEK -3,3).
- The equity ratio at September 30, 2024, was 85% (86%).
Significant events in the third quarter of 2024
- Chairman Hans von Celsing and Board member Paolo Raffaelli announce their intention to step down from the Board.
Significant events after the end of the period
- Extraordinary General Meeting elects Peter Max and Peter Mantas to the Board of Directors and re-elects Lars-Erik Eriksson, Marika Crohns, and Sandra Brandmeier. A subsequent Board meeting elects Peter Max as new Chairman.
- Announcement that CLS will focus entirely on its successful neurosurgery business positioning the company for sustainable high-margin growth with a more streamlined operation.
Comments from CEO Dan J. Mogren
The third quarter showed the strength and success of our neurosurgery business. We continued to grow revenues on the back of an increasing number of ClearPoint Prism installations in the US following the decision in June by our US partner, ClearPoint Neuro Inc, to move to Full Market Release. We are also now seeing the flow on effects of our cost reduction program which has reduced our cost base and allowed us to free up capital for planned investments in production capacity in and our continued commercialization of Prism. Following the end of the quarter we made an important announcement to position CLS for sustainable and high-margin growth going forward.
Revenue increases and improved operating margins
Revenues in Q3 were SEK 5.4 million, representing an increase of more than 170% when compared to the same period last year. Looking at the full first nine months of 2024, revenues grew by more than 270% to SEK 14.2 million versus the first nine months of 2023. Increased revenues are a result of the Full Market Release rollout of ClearPoint Prism and income from sales of disposables as more patients are treated.
The elements of the cost savings program we announced earlier in 2024 are now in place and we are already seeing improvement in our operating margin versus the same quarter in 2023. A large part of this improvement is driven by executing our plan to focus on the neurosurgery business and a consequent reduction of headcount in the US from three people to one person as well as a reduction in external costs, primarily related to our US urology business.
ClearPoint Prism rollout on plan and more patients treated
The number of sites in the US with ClearPoint Prism systems installed almost doubled following ClearPoint Neuro Inc’s decision to move to Full Market Release. More patients can now access less invasive and potentially more effective treatment for life threatening conditions in the brain. The increased demand for disposables and services during the quarter has shown that CLS has the capabilities to meet the requirements of a growing market.
Our ‘razor/razor blade’ business model means that CLS benefits from each new site that uses ClearPoint Prism through repeat sales of sterile disposables to our partner, ClearPoint Neuro Inc. The strength of the CLS business is not only in the unique nature of the treatment offered in neurosurgery, but the strong margins associated with repeat sales of the disposables necessary to treat each new patient.
Changes to the Board
Following the end of the quarter, a number of important announcements were made that have had an important impact on CLS. In September, Hans von Celsing and Paolo Raffaelli announced their intention to step down as members of the Board of Directors. Hans was Chairman of the Board of Directors for more than ten years and made a significant contribution to the current success of CLS. I would personally like to express my thanks to both Hans and Paulo for their contribution to CLS and their support and mentorship.
On 21 October, an Extraordinary General Meeting elected Peter Mantas and Peter Max to the Board. The EGM also resolved to re-elect Lars-Erik Eriksson, Marika Crohns, and Sandra Brandmeier as Board members. Following the EGM, the Board elected Peter Max as Chairman. Peter Max and Peter Mantas bring extensive international commercial and financial experience, including growing life science SMEs and in the neurosurgery sector.
Announcement on building sustainable high-margin growth business
Following the election of the new Board and Chairman, we announced an important next step in CLS’s development. To build a sustainable, high-margin growth business we will now focus entirely on our successful neurosurgery segment. This means we will exit unprofitable direct-to-clinic operations in the current prostate and urology business and dedicate resources to accelerating commercialization in neurosurgery through our strategic partner, ClearPoint Neuro Inc. We retain full confidence in our technology platform and offerings and future growth in segments outside neurosurgery will be based on an application of the capital-light ‘razor/razor blade’ commercial partnership model such as that which we have with ClearPoint Neuro Inc.
These changes will also allow us to further streamline the organization and to benefit from the strong demand for our high-margin neurosurgery disposables. We anticipate operating expenditure reductions of at least 30% in 2025 over 2024 and gross margins of 60% by year end 2026 underpinned by margins of 80% or above on recurring sales of disposables associated with the ClearPoint Prism system.
With these changes, we have a very exciting period ahead of us. As a leaner and more focused organization that prioritizes high margins on our products and high returns on invested capital, we are well positioned for sustainable long-term success. I look forward to you being part of this future.
Dan J. Mogren
CEO, Clinical Laserthermia Systems
For more information, please contact:
Dan J. Mogren, CEO, Clinical Laserthermia Systems AB (publ)
Tel: +46 – (0)705 – 90 11 40
E-mail: dan.mogren@clinicallaser.com
About CLS
Clinical Laserthermia Systems AB (publ), develops and sells TRANBERG®|Thermal Therapy System and ClearPoint Prism Neuro Laser Therapy System with sterile disposables, for minimally invasive treatment of cancer tumors and drug-resistant epilepsy. The products are marketed and sold through partners for image-guided laser ablation and are used in studies for treatment with imILT®, the company's interstitial laser thermotherapy for immune stimulating ablation with potential abscopal treatment effect. CLS is headquartered in Lund, Sweden, with subsidiaries in Germany, the United States and a marketing company in Singapore. CLS is listed on Nasdaq First North Growth Market under the symbol CLS B. Certified adviser (CA) is FNCA Sweden AB.
For more information about CLS, please visit the Company's website: www.clinicallaser.se
This disclosure contains information that CLS is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 31-10-2024 08:30 CET.